How Innovative Culture Shapes Digital Transformation and Organisational Resilience in IT Firms.

Abstract

Within the current technology-driven business environment, IT firms face transformative challenges that demand adaptable methodologies to sustain market leadership and ensure future prosperity. This study aims to identify the impact of Innovative culture on organisational resilience in the Sri Lankan IT sector, with a specific focus on the mediating role of Digital Transformation. Lack of empirical studies that investigate the interplay among Innovative culture, Digital transformation, and organisational resilience brings novelty to this research. Using a quantitative approach, data were collected from over 282 participants who were managerial or above-level employees in the Sri Lankan IT industry via surveys. Partial Least Squares Structural Equation Modelling (PLSSEM) was employed to analyse the data and test the hypothesised relationship between variables. The study's findings revealed that an innovative culture has a significant positive impact on digital transformation, as the innovative mindset ingrained encourages continuous growth, creativity, and risk-taking, thereby strengthening digital transformation initiatives. Both Innovative culture and Digital transformation have a significant positive impact on organisational resilience. Additionally, it was found that there is a complementary partial mediation of Digital Transformation in the relationship between Innovative culture and Organisational resilience. These findings underscore the importance of fostering an innovative culture and driving digital transformation in the IT industry to ensure sustainable business processes. Findings provide clear directions to industry leaders and policymakers for the strategic use of technology and effective business model design.