Claes Thorén
Claes Thorén

Thursday May 9 at 10.00-11.30
Score, Frescativägen 14 A, Stockholm University


Managing the digital transformation of physical space: Maintaining institutional legitimacy during processes of digitization

This presentation gives the background and preliminary findings of an ongoing Vinnova-funded project entitled “Managing the digital transformation of physical space”, that started in the fall of 2018 at the department of informatics and media, Uppsala university.

Digitalization blurs the boundaries between private and public, work and leisure, and between the analogue (physical or “real”) and the digital. The term “digitalization” has come to resonate with utopian virtues such as societal progress, democracy, participation, sustainability, equality and economic development. Meanwhile, there is a gradual recognition that complete digitalization is not a problem-solving “silver bullet”, as it has been shown to generate undesired phenomena, such as “information overload” and “digital detoxing”. Against  this backdrop, the project seeks to further understand the inherent values of the  physical  and offline in relation to the  digital and online, particularly focusing on  the interactions between human actors, and how to combine the two paradigms. While digitalization may drastically increase efficiency and reduce cost it does not always result in “meaningful technological encounters” (e.g. Turkle, 2015). For example, why are vinyl records experiencing a revival in 2019, when there is Spotify? Why would anyone start a physical bookstore when there is Amazon? The persistence of the pre-digital, “obsolete” or physical in spite of superior digital alternatives suggests that the physical (or analogue) experience is not so easily replaced by a digital one. Understanding when digital works and when it does not and in what context, is a key  success factor for all organizations that aspire to innovate and benefit from digital technologies. Should a bank focus entirely on online services or should there be physical offices; should these be coordinated in some complementary fashion, if the latter, how?

This project and its respective case studies aim to understand how digitalization affects the relationship between physical and digital space, not merely  from a service perspective but from an organizational perspective. This study focuses on three organizations at various stages of digital transformation: The Church of Sweden (Svenska kyrkan), Skandinaviska Enskilda Banken (SEB) and Uppsala City  Theatre  (Uppsala  Stadsteater).  All three organizations stress the importance  of physical space and face-to-face interactions with customers as a critical factor to reconcile in order to successfully maintain institutional legitimacy.

Preliminary findings indicate that loyalty and authenticity are more important than efficiency in customer-based contexts, and that physical interaction fosters loyalty and legitimacy, both from the perspective of the organization and from the perspective of the customer.