Adoption of digital transformation in logistics sector: A case of a state- owned enterprise in South Africa

Abstract

Digital technologies have brought about disruption in all industries and state- owned enterprises are not immune to the pervasive force of digital transformation. Digital adoption has emerged as a crucial aspect of organisational growth and competitiveness. As digital adoption grows in state-owned enterprises it is essential to know the starting point in their digital transformation journey by measuring digital maturity, identifying drivers and barriers, and devising strategies to manage them. The aim of this research was to evaluate the maturity level following the introduction of the Transnet 4.0 Strategy at the state-owned enterprise, exploring the drivers and barriers. This study used a convergent mixed methods design. The participants were management employees from Transnet Freight Rail, a state-owned enterprise. Qualitative data was collected through surveys completed by the TFR managers (n = 45) assessed the current digital maturity and used descriptive statistics in analysing survey data. Qualitative data was collected through semi-structured interviews. The interviews were verbatim transcribed and Braun and Clarke's thematic analysis was used to analyse interviews with executive and senior managers (n=9). Findings from both quantitative and qualitative data were triangulated to provide a richer understanding of digital transformation adoption in Transnet Freight Rail. Overall, TFR is still in the early stages of their digital transformation journey according to qualitative findings, quantitative findings suggest that TFR has moved beyond the early stage and is in the early developing stage. Concerningly, many participants highlighted digital strategy communication, change management and digital skills as lacking in TFR. This study identified a range of factors and barriers that influence and affect digital transformation adoption including leadership support, conducive employee environment, organisational iii readiness, poor IT infrastructure, high leadership turnover and employees resisting technology. As demand for the state-owned enterprise to be operationally efficient and financial constraints increase, so does the need to leverage digital technologies to change business models, improve operational processes and increased customer experience to improve organisational performance. As industries get disrupted by digital technology it is essential for organisations effectively manage barriers and leverage key drivers for a successful digital transformation implementation.