Innovation strategy, digital transformation and competitive advantage of manufacturing enterprises: evidence from China

PurposeThis study aims to integrate the concepts of digital transformation, innovation strategy, and competitive advantage, into a novel research model in an effort to identify a more competitive path for digital transformation within manufacturing enterprises.Design/methodology/approachThe research model was tested through multivariate hierarchical regression analyses, and Hayes' PROCESS for SPSS, utilizing survey data collected from 183 manufacturing enterprises in China.FindingsThe results indicate that, in comparison to research and development (R&D) and production, digital transformation in service and organizational activities exert a more significant impact on competitive advantage. Conversely, digital transformation in sales does not exhibit a significant impact on competitive advantage. Furthermore, in contrast to exploratory innovation and ambidexterity, exploitative innovation has a more pronounced influence on digital transformation. Additionally, digital transformation has been confirmed as a mediator in the relationship between innovation strategy and competitive advantage.Originality/valueThese findings expand our comprehension of digital transformation as an evolving process and shed light on the relationship between digital transformation and competitive advantage across various value-creating activities. This research serves as a valuable resource for decision-makers in selecting the most suitable path for digital transformation and configuring innovative resources.