Process for achieving digital sustainability in smart manufacturing transformation: a case study of a Chinese steel manufacturer

Purpose This study aims to explore how firms can achieve digital sustainability (DS) in smart manufacturing transformation. Design/methodology/approach This study uses techniques drawn from grounded theory to analyze onsite interview data and secondary data collected from a representative Chinese steel manufacturer with a focus on smart manufacturing and constructs a theoretical foundation for this topic. Consequently, this work presents a typology of DS capabilities and a process model for their development. Findings To achieve DS, manufacturing firms should develop three types of DS capabilities (i.e. DS production capability, DS management capability and DS environmental governance capability). The following three key challenges must be overcome in developing DS: the efficiency-oriented legacy infrastructure, the lack of metrics for incorporating sustainability goals into data-driven decision-making and the lack of standardization and corresponding approaches to navigating the regulatory landscape. Manufacturers must implement three processes (i.e. structuring, optimizing and scaling) to address these challenges and develop these three types of DS capabilities. The key subprocesses associated with each process are also identified. Originality/value This study responds to the recent call for DS research by enriching the existing conceptualization of this notion as a singular theoretical concept. It provides a typology of DS capabilities and a process model that can support their development. It thus contributes to the literature on digital transformation by identifying key challenges and relevant solutions in smart manufacturing transformation.