Capability-Based Framework on How Organizational Culture Shapes Digitalisation-Driven Operational Performance Improvement

Abstract

Digitalisation has become increasingly important for firms seeking to improve operational efficiency, responsiveness, and competitiveness. However, the adoption of digital technologies does not necessarily translate into superior operational performance, particularly when firms lack the internal capabilities required to effectively integrate digital resources into existing business practices. This conceptual paper proposes a capability-based framework explaining how organisational culture enables digitalisation-driven performance improvement among building material trading companies in the Sultanate of Oman. Drawing upon the Resource-Based View and Dynamic Capability Theory, the framework conceptualises digitalisation of products and processes through three dimensions, namely e-commerce, interactive social media, and web advertising. Organisational culture is positioned as an enabling mechanism comprising innovative, supportive, and bureaucratic cultural orientations, while operational excellence is represented through cost, quality, delivery, and flexibility performance. The framework argues that digitalisation provides valuable technological resources and opportunities, but organisational culture determines how effectively these resources are integrated, adopted, and transformed into operational capabilities. The paper therefore proposes that organisational culture mediates the relationship between digitalisation and operational excellence. The framework contributes to the digital transformation literature by moving beyond a technology-centric perspective and highlighting the importance of complementary organisational capabilities in converting digitalisation initiatives into operational value. It also provides a contextualised theoretical foundation for understanding digitalisation-driven performance improvement in the building material trading sector in Oman and offers a basis for future empirical investigation.