Navigating the dark side of digital transformation: addressing discrimination and toxicity in tech-driven organizations

Purpose This research explores the unintended negative consequences of digital transformation on workplace culture, focusing on the perpetuation of discrimination and toxicity in organizational settings. It specifically examines these phenomena within Chinese and Greek organizations, offering a comparative perspective on how cultural and structural contexts shape the outcomes of digital transformation. Design/methodology/approach This research employs a qualitative methodology, using semi-structured interviews with 40 participants from diverse roles in Chinese and Greek firms. Thematic analysis was conducted to identify patterns and themes supported by NVivo software for systematic coding. This research also draws on theoretical frameworks, including Hofstede's cultural dimensions theory and emotional labor theory, to interpret the findings. Findings Digital transformation challenges workplace dynamics through cultural erosion, algorithmic opacity, skill obsolescence, and ethical dilemmas, while heightening emotional labor, social isolation, and technostress. These issues are amplified by inadequate leadership. Addressing these challenges requires transparency, ethical frameworks, skill development, and culturally responsive leadership to balance innovation with employee well-being and inclusivity. Practical implications Organizations should prioritize algorithmic transparency, offer continuous learning opportunities to address skill obsolescence, and implement ethical frameworks for AI and surveillance. Leadership strategies should focus on fostering inclusivity, trust, and cultural preservation to mitigate the adverse impacts of digital transformation. Social implications The findings underscore the need for equitable and inclusive digital transformation strategies considering societal and cultural contexts. Policymakers can use these insights to develop regulations promoting ethical technology adoption and employee well-being. Originality/value This research highlights the socio-cultural impacts of digital transformation, contributing novel insights into how cultural contexts influence workplace dynamics. It extends theoretical frameworks by linking digital transformation to emotional labor, cultural dimensions, and leadership theories, emphasizing the importance of cultural sensitivity and ethical practices in digital workplaces.