DIG Research

DIG Research

Being relevant and interesting is key to leading research. Today, that means being able to solve problems at macro, meso, and micro level. Digital value creation, innovation, and transformation for sustainable growth is an emerging common denominator. DIG conducts rigorous interdisciplinary research on and with leading Norwegian business partners to help Norwegian companies enable new customers, innovations, develop their business models, and adapt organizations to a digital world.

DIG research includes five research themes described in the figure below.
  • Methodology developments

    Methodology developments

    THEME 1: Methodology developments

    We are currently working on updating information about this theme.

  • Adoption of technologies and innovations

    Adoption of technologies and innovations

    THEME 2: Adoption of technologies and innovations

    Digital innovations and new services are of little value unless they are adopted by end-users. As the majority of new products and services in fact fail, it is crucial for both commercial firms and government institutions to understand the drivers and barriers of new service adoption, as well as how to change consumer behavior in digital environments. 

    DIG will study how organizations can increase commercial success by lowering consumer adoption barriers, removing uncertainty and ‘nudging’ consumers to change their behavior in digital environments and complex service systems. Digital services are radically different from traditional services in their reliance on platforms, co-creation with other consumers, and sharing/subscription rather than ownership. Together with industry partners, DIG will offer new perspectives and tools for understanding and influencing how consumer’s think and act in such complex decision contexts.

    DIG will also focus on how organizations can build and maintain trust when customer interactions are primarily digital, as well as study how consumers react to the use and application of personal data in such interactions.  

    Current projects on consumer adoption include:

    • New approaches and perspectives for understanding consumer adoption
    • Consumer reactions to sharing-economy services
    • Consumer adoption of new sustainable products and business models
    • The different facets of digital trust in adoption of novel services
    • Reactance and resistance to the use of end-users personal data
    • The role of consumer movement in decision-making
    • Consumer interaction with robots/AI
    • The role of VR in destination marketing
    • The effects of quantification on consumer behavior
    • Improving decisions and changing behavior via digital nudging
  • Creating and capturing value in the digital era

    Creating and capturing value in the digital era

    Theme 3: Creating and Capturing Value in the Digital Era

    This Theme will lay the groundwork by defining and conceptualizing digital business model innovation and its antecedents, barriers, facilitators and impact on firm performance. We will tackle these questions from an integral perspective including key issues such as how policymakers best can tax digital business models, how can managers efficiently and effectively capture data from various sources (digital and analog). We will also address the labor implications of digital business models on the workforce. The qualitative and quantitative findings of the three subprojects under Theme 3 aid managers on their path to digital transformation and business model innovation and allow policymakers to gauge the risks and impact of a digital economy from a welfare state and labor market perspective.

    Subproject 3.1 Digital business models: barriers, facilitators and performance outcomes

    The far-reaching consequences of disruption deeply affect established firms which need to rethink their traditional business models and how they can create, deliver, communicate and capture value in a digital economy. Specifically, we need an empirical analysis of how digitalization affects investments in business assets, and we need to define different types of digital business models and the reasons underlying their different profitability levels.

    Specifically, we will combine (i) qualitative case studies conducted in close collaboration with industry partners (e.g., Telenor, EVRY, Posten) to establish and refine hypotheses and (ii) survey design among Norwegian service providers and registry data to test the resulting hypotheses. The findings of the qualitative and quantitative analyses will shed light on the linkages between digitalization, business model innovation and firm performance. Our results provide a deep understanding of these issues which we expect to significantly contribute to the theoretical advancement of the field as well as provide managers with a framework on how to design, implement and manage digital BMI, i.e. value creation, value delivery, value communication, and value capturing.

    Subproject 3.2  Taxation of Digital Economy

    In this subproject we address the bold question of how to tax the digital economy. Digital firms are not characterized by one single business model. What unites them is that they collect data that has commercial value. Some of these firms are platform firms that cater to several customer groups whereas others cater to only one customer group. How they collect data varies and the use of data also varies. In order to address how to tax digital firms, we use theoretical models of algebra to analyze how taxation affect behavior and compliance. Insights from these models will be used as stepping-stones to design a tax system that aims at levelling the playing field of taxation in a world with digital firms. An important part of the project is to analyze how to avoid barter, which is illegal in most countries. Some of the largest multinationals like Facebook and Google, for example, have barter as an important part of their business model. Much like the OECD initiative to tax the digital economy, the project aims to deliver proposals for applied tax policy towards digital firms that in addition fosters self-compliance. Also different from the OECD initiative is that policy is carved out from modelling behavior.

    Thus, in an unprecedented effort, we seek insights through models on how such firms react to taxation. These insights will then be used as a stepping stone to design a tax system that levels the playing field of taxation in a digital economy and avoids bartering and, finally, that shows how digital footprints can be made part of the national tax base. The end outcome is to form proposals for applying tax policies with respect to digital firms.

    Subproject 3.3 Effects of Digitalization on Job Creation and Sustainability

    Despite the global concern to understand the labor market impacts of automation, we lack causal evidence on the impact of automation on workers and the distribution of consequences across workers for instance due to a change in the contractual relationships between employers and employees. Further, it is unclear whether the countervailing force of task and job creation is sufficiently large to offset the job destruction caused by the current wave of robotization. To address these issues, we first study the causal consequences of automation across the distribution of workers and how potential job destruction can be offset by the creation of new tasks. In a second step, we focus directly on how new policies can be used to foster restructuring and recovery from job destruction following technological change.

    To address the above knowledge gaps and make inferences on the possible causal relationships between technological change and restructuring of firms and how the labor market and workers are affected by such changes, we will combine highly suitable and unique Norwegian register data provided by Norway’s National Bureau of Statistics (SSB) at the individual- and area-levels with innovative use of well-established causal identification methods. As an output the policy brief ‘Replaced by Robots’ will inform policymakers, educational institutions, unions, business managers, and households about the labor market and welfare impacts of automation and the implications for inequality by identifying workers who will lose or gain when firms become more digitized.

  • Strategy in / for digital ecosystems

    Strategy in / for digital ecosystems

    THEME 4: Strategy in and for Digital Ecosystems  

    In a world with increasing levels of digitalization, we see that organization often operate within so-called digital ecosystems. Thus, understanding digital ecosystems is relevant because it represents a new way of organizing economic activity, and because this new way is rapidly capturing “market shares” from alternative and more traditional ways of organizing and coordinating economic activities. By traditional ways we mean those methods of organization and coordination that rely on integrated hierarchical solutions within one diversified firm, as transactions between independent parties in a market, or by regular alliances or collaboration-projects.

    What sets digital ecosystems apart is that they typically arise in situations where a range of different technologies and areas of expertise are needed to interact (seamlessly and continually) to realize a value creation potential or some specific value proposition. These technologies and areas of expertise are possessed by more than one organization, often with diverse backgrounds, which requires coordination. This coordination is mostly achieved by standardizing the interfaces between the different modules of the system. If this interface is respected, modules will work together even if those working on the different modules remain independent firms. Data and information can flow unrestricted across modules, participants in the system can specialize on different modules and innovate and experiment on their own - without the need for permission or funding from some central decision maker. As a result, digital ecosystems have in many settings demonstrated an ability to innovate faster, specialize more, and create bundles of complementary goods and services that users’ value more effectively than alternative arrangements

    Despite this common understanding, academics and practitioners struggle with several core aspects of digital ecosystems which ultimately affects their ability to create and capture value from operating in such systems. On one hand, the large variation, complexity and dynamism of these systems make it difficult to understand how they are born/created, how they function, how they compete and change, and how to navigate and position within them. Or in more general terms: how to think about strategy in and for digital ecosystems.   

  • Organizational capacity for radical change and innovation

    Organizational capacity for radical change and innovation

    THEME 5: Organizational capacity for radical change and innovation

    Digital transformation almost invariably implies some degree of organizational change. Radical change has proven particularly challenging for well-established firms with a history of success as they tend to get caught by the success paradox and develop structural and cultural inertia. In this stream of research, we examine how established firms can develop capacity for radical change and innovation, such as that required by digital transformation. Beyond recognizing that fundamental change is required, it remains a challenging task for leaders to implement change. If leaders are not able to understand which changes are required and how to implement those changes, then the knowledge obtained from the former four research pillars will never lead to the desired value creation.  DIG will investigate the change capabilities required for digital transformation and develop new insights on how established firms can develop their capacity to transform, renew and radically innovate.

    The research theme includes the ongoing RaCE (Radical Technology-Driven Change in Established Firms) project, which is a four-year research project funded by the Norwegian Research Council in collaboration with Deloitte, DNB, Læredal Medical and Telenor. RaCE conducts comparative analyses of contemporary organizational solutions aiming for radical change and innovation, documenting their inherent benefits and challenges. A series of case studies on how firms have adopted the ambidextrous solution, an agile way of working, different types of partnerships including ecosystems is being developed through close collaboration with industry partners and other firms that attempt to build their long-term capacity for radical change and innovation. The goal is to describe each organizational solution in detail, to identify patterns in leadership processes that enable (or hamper) the implementation of each solution, and to uncover important contingencies for each solution to function efficiently and effectively. See the RaCE webpage here.

    For many businesses sharing big data is envisioned as the “new goldmine”. In the Scandinavian countries, the public sector has build up unique data registers with significant potential within and across the public and private sector. We will use this research opportunity to study how radical change can come about through novel and innovative cooperation between the public and private sector. Key partners in this research stream are Tax Norway and Finance Norway.