DOI: https://doi.org/10.14710/dijb.8.1.2025.63-75

Corporate restructuring for firm performance improvement: The strategic role of digital transformation and digital human capital

1Postgraduate Program in Faculty of Economic and Business Education, Universitas Pendidikan Indonesia, Indonesia

2Badan Pengembangan SDM Kementerian Komunikasi dan Digital, Indonesia

Open Access Copyright 2025 Diponegoro International Journal of Business under http://creativecommons.org/licenses/by-sa/4.0.

Citation Format:
Abstract
Corporate restructuring strategies are critical for improving firm performance, yet the effectiveness of such efforts can vary. In today’s dynamic business environment, integrating digital transformation and digital human capital into these strategies has become increasingly important. This study aims to examine the moderating effect of digital transformation and digital human capital on the relationship between restructuring strategies and firm performance. Using cross-sectional data from 78 publicly listed companies that implemented restructuring strategies in 2023, including IPOs, warrants, and delisting actions, this study assesses their impact on firm’s performance. Results show both organizational and portfolio restructuring positively influence firm’s performance, with digital transformation serving as a critical moderator that enhance portfolio restructuring effectiveness. Financial restructuring, however, demonstrate a negative effect on firm’s performance, moderated only slightly by digital human capital, which does not independently improve performance. The findings highlight the need for alignment between digital initiatives and restructuring strategies to optimize firm outcomes.
Fulltext View|Download
Keywords: restructuring strategy; digital transformation; digital human capital; firm performance

Article Metrics:

Article Info
Section: Articles
Language : EN
Recent articles
Green banking practices and HRM in enchancing innovation capability: A knowledge management perspective on sharia banking performance Building an adaptive selling capability model to improve MSMEs marketing performance Corporate restructuring for firm performance improvement: The strategic role of digital transformation and digital human capital More recent articles
  1. Abdallah, Y. O., Shehab, E., & Al-Ashaab, A. (2021). Towards Managing Digital Transformation in Manufacturing Industry: Theoretical Framework. In Advances in transdisciplinary engineering. IOS Press. https://doi.org/10.3233/atde210006
  2. Atiase, R. K., Platt, D. E., & Tse, S. Y. (2004). Operational Restructuring Charges and Post‐Restructuring Performance*. In Contemporary Accounting Research (Vol. 21, Issue 3, p. 493). Wiley. https://doi.org/10.1506/v4rb-cdxj-q216-1406
  3. Ballesta, M., Livnat, J., & Sinha, N. (1999). Corporate reorganizations: Changes in the intensity of labor and capital expenditures. Journal of Business Finance & Accounting, 26(9‐10), 1205-1238
  4. Barykin, S. Y., Kapustina, I. V., Kirillova, T. V., Yadykin, V. K., & Konnikov, Y. A. (2020). Economics of Digital Ecosystems. Journal of Open Innovation: Technology, Market, and Complexity, 6(4), 124. https://doi.org/https://doi.org/10.3390/joitmc6040124
  5. Barykin, S., Borovkov, A., Rozhdestvenskiy, O., Tarshin, A., & Yadykin, V. (2020). STAFF COMPETENCE and TRAINING for DIGITAL INDUSTRY. IOP Conference Series: Materials Science and Engineering, 940(1). https://doi.org/10.1088/1757-899X/940/1/012106
  6. Bilal, M., Zhao, X., Wu, J., Sohu, J. M., Akhtar, S., & Hassan, M. I. U. (2024). Digital Transformation and SME Innovation: A Comprehensive Analysis of Mediating and Moderating Effects. Journal of the Knowledge Economy. Springer Science Business Media. https://doi.org/10.1007/s13132-024-02054-0
  7. Bowman, E. H., & Singh, H. (1993). Corporate restructuring: Reconfiguring the firm. Strategic Management Journal, 5–14
  8. Chen, C., Zhang, Y., & Wang, S. (2023). Digital transformation and firm performance: a case study on China’s listed companies in 2009–2020. Digital Economy and Sustainable Development, 1(1). https://doi.org/10.1007/s44265-023-00018-x
  9. Chen, W., & Srinivasan, S. (2023). Going digital: implications for firm value and performance. In Review of Accounting Studies (Vol. 29, Issue 2, p. 1619). Springer Science+Business Media. https://doi.org/10.1007/s11142-023-09753-0
  10. Diaz-Fernandez, M., Pasamar-Reyes, S., & Valle-Cabrera, R. (2017). Human capital and human resource management to achieve ambidextrous learning: A structural perspective. BRQ Business Research Quarterly, 20(1), 63–77. https://doi.org/https://doi.org/10.1016/j.brq.2016.03.002
  11. El-Khalil, R., & Mezher, M. A. (2020). The mediating impact of sustainability on the relationship between agility and operational performance. Operations Research Perspectives, 7, 100171. https://doi.org/https://doi.org/10.1016/j.orp.2020.100171
  12. Feliciano-Cestero, M. M., Ameen, N., Kotabe, M., Paul, J., & Signoret, M. (2023). Is digital transformation threatened? A systematic literature review of the factors influencing firms’ digital transformation and internationalization. Journal of Business Research, 157, 113546. https://doi.org/https://doi.org/10.1016/j.jbusres.2022.113546
  13. Furrer, O. (2016). Corporate level strategy: Theory and applications. Routledge
  14. Ghi, T. N., Thu, N. Q., Huan, N. Q., & Trung, N. T. (2022). Human capital, digital transformation, and firm performance of startups in Vietnam. Management, 26(1), 1–18
  15. Grimpe, C., Sofka, W., & Kaiser, U. (2023). Competing for digital human capital: The retention effect of digital expertise in MNC subsidiaries. Journal of International Business Studies, 54(4), 657–685. https://doi.org/10.1057/s41267-021-00493-4
  16. Guerra, J. M. M., Valle, I. D. del, & Méndez-Suárez, M. (2022). The impact of digital transformation on talent management. Technological Forecasting and Social Change (Vol. 188, p. 122291). Elsevier BV. https://doi.org/10.1016/j.techfore.2022.122291
  17. Halid, H., Yusoff, Y. M., & Somu, H. (2020, May). The relationship between digital human resource management and organizational performance. ASEAN Business, Environment, and Technology Symposium (ABEATS 2019) (pp. 96-99). Atlantis Press
  18. Hanelt, A., Bohnsack, R., Marz, D., & Antunes Marante, C. (2021). A Systematic Review of the Literature on Digital Transformation: Insights and Implications for Strategy and Organizational Change. Journal of Management Studies, 58(5), 1159–1197. https://doi.org/10.1111/joms.12639
  19. Hatch, N. W., & Dyer, J. H. (2004). Human capital and learning as a source of sustainable competitive advantage. Strategic Management Journal (Vol. 25, Issue 12, p. 1155). Wiley. https://doi.org/10.1002/smj.421
  20. Huseynli, B. (2022). Digital Transformation for Improving Customer Experience. In Advances in marketing, customer relationship management, and e-services book series (p. 78). IGI Global. https://doi.org/10.4018/978-1-6684-4380-4.ch005
  21. Imjai, N., Aujirapongpan, S., & Mahadi, N. (2023). The interplay of digital and management accounting competency to competitive performance in the open innovation era: A case of Thai micropreneurs. Journal of Open Innovation: Technology, Market, and Complexity, 9(4), 100167. https://doi.org/https://doi.org/10.1016/j.joitmc.2023.100167
  22. Kang, D. (2004). Key Success Factors in the Revitalization of Distressed Firms: A Case of the Korean Corporate Workouts. SSRN Electronic Journal. RELX Group (Netherlands). https://doi.org/10.2139/ssrn.527382
  23. Khurana, I. K., & Lippincott, B. (2000). Restructuring and Firm Value: The Effects of Profitability and Restructuring Purpose. Journal of Business Finance &amp Accounting (Vol. 27, Issue 9, p. 1085). Wiley. https://doi.org/10.1111/1468-5957.00348
  24. Kłosowski, S. (2012). The application of organizational restructuring in enterprise strategic management process. Management (Vol. 16, Issue 2, p. 54). De Gruyter. https://doi.org/10.2478/v10286-012-0055-z
  25. Kraus, S., Jones, P., Kailer, N., Weinmann, A., Chaparro‐Banegas, N., & Roig‐Tierno, N. (2021). Digital Transformation: An Overview of the Current State of the Art of Research. SAGE Open (Vol. 11, Issue 3, p. 215824402110475). SAGE Publishing. https://doi.org/10.1177/21582440211047576
  26. Lajili, K., Lin, L. Y.-H., & Rostamkalaei, A. (2020). Corporate governance, human capital resources, and firm performance: Exploring the missing links. Journal of General Management (Vol. 45, Issue 4, p. 192). SAGE Publishing. https://doi.org/10.1177/0306307019895949
  27. Lemon, K. N., & Verhoef, P. C. (2016). Understanding customer experience throughout the customer journey. Journal of Marketing, 80(6), 69–96. https://doi.org/10.1509/jm.15.0420
  28. Li, S., Gao, L., Han, C., Gupta, B., Alhalabi, W., & Almakdi, S. (2023). Exploring the effect of digital transformation on Firms’ innovation performance. Journal of Innovation & Knowledge, 8(1), 100317. https://doi.org/https://doi.org/10.1016/j.jik.2023.100317
  29. Nurharjanto, Haryono, T., Suhardjanto, D., Lukviarman, N., & Setiany, E. (2018). Corporate governance, privatisation, and financial performance of Indonesian state-owned enterprises. International Journal of Revenue Management, 10(2), 168–188
  30. Pasban, M., & Nojedeh, S. H. (2016). A Review of the Role of Human Capital in the Organization. Procedia - Social and Behavioral Sciences, 230, 249–253. https://doi.org/https://doi.org/10.1016/j.sbspro.2016.09.032
  31. Paterson, S., & Walters, A. (2023). Selective Corporate Restructuring Strategy. Modern Law Review, 86(2), 436–464. https://doi.org/10.1111/1468-2230.12767
  32. Plekhanov, D., Franke, H., & Netland, T. H. (2023). Digital transformation: A review and research agenda. European Management Journal, 41(6), 821–844. https://doi.org/https://doi.org/10.1016/j.emj.2022.09.007
  33. Riofrío, A. M. S., Martín, L. Á. G., & Forcadell, F. J. (2014). Business portfolio restructuring: a comprehensive bibliometric review. Scientometrics, Vol. 102, Issue 3, p. 1921. Springer Nature (Netherlands). https://doi.org/10.1007/s11192-014-1495-0
  34. Rožman, M., Tominc, P., & Štrukelj, T. (2023). Competitiveness Through Development of Strategic Talent Management and Agile Management Ecosystems. Global Journal of Flexible Systems Management, Vol. 24, Issue 3, p. 373. Springer Science+Business Media. https://doi.org/10.1007/s40171-023-00344-1
  35. Sari, N. A. (2022). The Effect of Corporate Life Cycle on Corporate Restructuring. Riset Akuntansi dan Keuangan Indonesia, Vol. 7, Issue 1, p. 16. Muhammadiyah University Press. https://doi.org/10.23917/reaksi.v7i1.15373
  36. Sayudin, S., Nurjanah, A., & Yusup, A. (2023). Innovation strategy and product development to increase company competitiveness in digital era. Eduvest-Journal of Universal Studies, 3(5), 973–996
  37. Sayyidah Alifah Rahmani, & Erma Setiawati. (2024). Pengaruh Financial Distress, Firm Life Cycle, dan Corporate Restructuring Terhadap Nilai Perusahaan: Studi Empiris Perusahaan Infrastuktur yang Terdaftar di BEI Tahun 2020-2022. Al-Kharaj: Jurnal Ekonomi, Keuangan & Bisnis Syariah, 6(7). https://doi.org/10.47467/alkharaj.v6i7.3410
  38. Siddoo, V., Sawattawee, J., Janchai, W., & Thinnukool, O. (2019). An exploratory study of digital workforce competency in Thailand. Heliyon, 5(5), e01723. https://doi.org/https://doi.org/10.1016/j.heliyon.2019.e01723
  39. Stonehouse, G. H., & Konina, N. Y. (2020, February). Management challenges in the age of digital disruption. 1st International Conference on Emerging Trends and Challenges in the Management Theory and Practice (ETCMTP 2019) (pp. 1-6). Atlantis Press
  40. Umar, M. A. (2023). Corporate Restructuring. International Journal of Strategic Decision Sciences, 14(1), 1–11. https://doi.org/10.4018/IJSDS.319974
  41. Verhoef, P. C., Broekhuizen, T., Bart, Y., Bhattacharya, A., Qi Dong, J., Fabian, N., & Haenlein, M. (2021). Digital transformation: A multidisciplinary reflection and research agenda. Journal of Business Research, 122, 889–901. https://doi.org/10.1016/j.jbusres.2019.09.022
  42. Vial, G. (2019). Understanding digital transformation: A review and a research agenda. Journal of Strategic Information Systems, Vol. 28, Issue 2, pp. 118–144. Elsevier B.V. https://doi.org/10.1016/j.jsis.2019.01.003
  43. Viloria-Núñez, C., Tovar, M., & Millán, A. C. (2023). Digital archetypes: a tool for understanding personality characteristics in the digital culture. Humanities and Social Sciences Communications, 10(1), 1–14. https://doi.org/10.1057/s41599-023-02327-0
  44. Vo, D. H., Vo, A. T., Dinh, C. T. H., & Tran, N. P. (2024). Corporate restructuring and firm performance in Vietnam: The moderating role of digital transformation. PLoS ONE, 19(5 May). https://doi.org/10.1371/journal.pone.0303491
  45. Vrchota, J., Mařiková, M., Řehoř, P., Rolínek, L., & Toušek, R. (2020). Human Resources Readiness for Industry 4.0. Journal of Open Innovation: Technology, Market, and Complexity, 6(1), 3. https://doi.org/https://doi.org/10.3390/joitmc6010003
  46. Warner, K. S. R., & Wäger, M. (2019). Building dynamic capabilities for digital transformation: An ongoing process of strategic renewal. Long Range Planning, 52(3), 326–349. https://doi.org/10.1016/j.lrp.2018.12.001

Last update:

No citation recorded.

Last update:

No citation recorded.