New intelligent empowerment for digital transformation

TL;DR

This paper introduces a novel evaluation method using large language models to measure digital transformation in enterprises, revealing its positive impact on financial performance and the varying effects of different technologies.

Contribution

It presents an innovative LLM-based evaluation tool for digital transformation, expanding AI applications in economic research and providing new insights into DT's effects.

Findings

DT improves financial performance

Different technologies have varying impacts

Blockchain has limited positive effect

Abstract

This study proposes an innovative evaluation method based on large language models (LLMs) specifically designed to measure the digital transformation (DT) process of enterprises. By analyzing the annual reports of 4407 companies listed on the New York Stock Exchange and Nasdaq from 2005 to 2022, a comprehensive set of DT indicators was constructed. The findings revealed that DT significantly improves a company's financial performance, however, different digital technologies exhibit varying effects on financial performance. Specifically, blockchain technology has a relatively limited positive impact on financial performance. In addition, this study further discovered that DT can promote the growth of financial performance by enhancing operational efficiency and reducing costs. This study provides a novel DT evaluation tool for the academic community, while also expanding the application scope of generative artificial intelligence technology in economic research.