The impact of digitalization on the value creation and the financial performance of companies. A literature review

Abstract

Since the emergence of the concept of " digitalization " and its adoption by the professional sphere, an eminent need for measurement and control has followed for efficient management of the performance of firms.

Digitalization has become increasingly important in today's business world, as it enables organizations to streamline processes, enhance productivity, and improve customer experiences. By leveraging digital technologies, firms can automate routine tasks, reduce errors, and gain insights from large data sets that help them make more informed decisions. Additionally, digitalization promotes collaboration and communication, both internally and externally, making it easier for teams to work together and share information. This, in turn, increases efficiency and reduces the time and costs associated with traditional communication methods.

The purpose of this article is based on a critical analysis of scientific papers to identify firstly the main factors, issues, and challenges of digitization as well as the tools and indicators chosen by the literature for performance measurement, secondly to study the theoretical contribution of digitalization to the improvement of business performance. More specifically, we focused our bibliographic research on the use of digital practices and their impact on the financial performance.

Overall, this article provides insights into the relationship between digitalization and business performance. It highlights the importance of measuring and monitoring the impact of digital practices on financial performance and the need to consider the context in which these practices are implemented.

The results have shown, on the one hand, that digitalization has a positive impact on the financial performance of companies, and on the other hand, in different contexts, that digitalization has a negative impact on financial performance. This multitude of results is mainly due to the change in the context and the measurement variables.

Keywords: digitalization, financial performance, firms, innovation, value creation.

JEL Classification: M15

Paper type: Theoretical research