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Performance feedback and enterprise digital transformation

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  • Rui Li
  • Jing Rao
  • Liangyong Wan

Abstract

This study draws on the behavioural theory of the firm to examine the impact of performance feedback on enterprise digital transformation. We develop a set of hypotheses and empirically test them using panel data of Chinese A-share listed firms from 21 to 2019. The fixed-effects panel data models serve as an estimation technique. Empirical results show that as performance falls below aspiration, the degree of enterprise digital transformation first increases and then decreases, as performance rises above aspiration, the degree of enterprise digital transformation first decreases and then increases. That is, there is an inverted U-shaped relationship between negative performance feedback and enterprise digital transformation and a U-shaped relationship between positive performance feedback and enterprise digital transformation. Moreover, CEO openness significantly intensifies digital transformation in response to negative performance feedback, and industrial digitalization positively moderates the effects of positive performance feedback on digital transformation. Our findings highlight the importance of performance feedback on enterprise digital transformation, not only theoretically contributes to the research on digital transformation and behavioural theory, but also have notable implications for practice.

Suggested Citation

  • Rui Li & Jing Rao & Liangyong Wan, 2024. "Performance feedback and enterprise digital transformation," Applied Economics, Taylor & Francis Journals, vol. 56(23), pages 2720-2737, May.
    • Handle: RePEc:taf:applec:v:56:y:2024:i:23:p:2720-2737
    DOI: 10.1080/00036846.2023.2200231
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    Cited by:

    1. Chen, Wen & Zhang, Qiuyue, 2025. "Can corporate climate risk drive digital transformation? Evidence from Chinese heavy-polluting enterprises," Technological Forecasting and Social Change, Elsevier, vol. 212(C).
    2. Xiaofei Jia & Lichao Lin & Ziling Huang, 2025. "Transformative forces: how capital intensity and technological innovation shape digital evolution in Chinese enterprises," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 15(4), pages 1205-1224, December.
    3. Yali Li & Gaobin Du & Yilun Lu, 2025. "Management incentives, governance, and digital transformation: effects on financial disclosure integrity," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 49(4), pages 1115-1145, December.
    4. Mingtao Yan & Jianji Zhao & Mingyue Yan & Lianlian Wang & Shimeng Zhou & Minghao Zhang, 2025. "Coupling coordination relationship between high-quality economic development and carbon emission performance in China: degree measurement, spatio-temporal evolution, and driving factors," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(10), pages 24061-24081, October.
    5. Yingjie Xu & Bingchao Zheng & Baojie Guo, 2025. "How Do Industrial Robots Affect the Total Factor Productivity in Manufacturing Enterprises?," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(4), pages 14057-14093, October.

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