The impact of digitalization on the division of labour in enterprises- evidence from China

ABSTRACTIn the context of the accelerated development of digitalization, the rapid popularization and wide application of digital technology have become significant factors driving enterprises to participate more deeply in the division of labour. This paper examines data from 2359 A-share listed companies in China from 2010 to 2018, using a combination of machine learning text analysis and multiple regression analysis to construct a digital transformation index. Our research findings reveal that digital transformation has an inverted U-shaped effect on vertical specialization in enterprises’ division of labour. The present study examines the moderating effects of organizational inertia on the linear relationship between digital transformation and vertical specialization division of labour in enterprises. Additionally, the study explores the negative moderating effects of corporate strategic radicality on the inverted U-shaped relationship between the two variables. The findings of this study are significant as they provide a theoretical explanation for the impact mechanism of digital transformation development on the production organization mode of enterprises.KEYWORDS: Digitalizationdivision of labourorganizational inertiacorporate strategyproduction organization modeJEL CLASSIFICATION: O31O33F66 Disclosure statementNo potential conflict of interest was reported by the author(s).Data availability statementThe data that support the findings of this study are available from the authors upon reasonable request.