Enterprise digitalisation and financial performance: the moderating role of dynamic capability

Digitalisation exerts a large influence on enterprise value creation. We identify four dimensions for measuring digitalisation at the enterprise level, i.e. value-chain digitalisation, business-process digitalisation, product-service digitalisation, and application of digital technology. Through the survey of 262 Chinese enterprises, we empirically find that there is an inverted U-shaped relationship between enterprise digitalisation and financial performance. And this relation is positively moderated by dynamic capability. Our results contribute to the literature on digitalisation at the micro enterprise level, and deeply explain the phenomenon of digitalisation paradox.