Digital Innovation and Organizational Performance: A Literature Review

Abstract

Digital innovation has emerged as a critical driver of organizational performance in the rapidly evolving digital economy. Organizations increasingly adopt digital technologies to innovate business models, improve operational processes, and enhance customer experiences. This study presents a literature review on the relationship between digital innovation and organizational performance by synthesizing findings, theories, and conceptual frameworks from existing academic studies. The research adopts a qualitative literature review approach, analyzing peer-reviewed journals, books, and reputable academic publications related to digital innovation and performance outcomes. The review indicates that digital innovation positively influences organizational performance through increased efficiency, agility, competitiveness, and value creation. However, the effectiveness of digital innovation is highly dependent on organizational readiness, leadership support, digital capabilities, and cultural alignment. This study provides a comprehensive theoretical overview that can serve as a foundation for future empirical research and strategic decision-making related to digital innovation initiatives.