DIGITAL CAPABILITY, WORK REDESIGN, AND EFFICIENCY: A STUDY OF INDIAN MANUFACTURING FIRMS

Abstract

Digital transformation is often described as a path to manufacturing efficiencies with the introduction of connected equipment, enterprise software and manufacturing data but fails to conceal that this is where the efficiencies are going. In this paper, we look at the management issue of making digital investments into the appropriate employee behaviours and integrated organizational processes. Suggests a combined effect of employee digital capability and work redesign is necessary to conclude whether the digital transformation can lead to increased efficiency in Indian manufacturing firm. Based on Indian empirical research, official data and work design theory, the paper proposes a capability–redesign–efficiency matrix and evaluates the extent of the evidence. Covered industries grew by 11.89% in gross value added (GVA) current prices in 2022–23 to 2023–24 and by 5.92% in employment. Additionally, the percentage of unincorporated non-agricultural establishments that used the internet increased from 26.7 per cent in 2023–24 to 39.4 per cent in 2025. Even if neither can be used to prove that digital transformation is an efficiency gain, combining both highlights the need for considering the evolution in production capacity alongside variable levels of digital uptake. Digital capability has more value when employees see and make sense of information, act on exceptions, and improve the process; work redesign provides them the decision rights, coordination procedures, and backstops to make them productive. Evaluation of the multilevel research design is designed for further testing with employees' responses and with observed plant results. The suggested gift is a more accurate description of how digital transformation can improve employee and/or organizational efficiency and when it cannot.