Digital Double Diamond (DiDD) Model Analysis of National Competitiveness Under Digital Transformation: An Application to Healthcare and Pharmaceutical Industries in South Korea and Switzerland

Abstract

The healthcare and pharmaceutical industries are rapidly changing under the digital transformation environment in the 2020s. Investments in this field are given priority, both at the business level and also at the national level, to enhance national competitiveness. However, a very limited number of studies examine the impact of digital transformation on the broader scope of the industry and national competitiveness. Furthermore, the existing studies and competitiveness indices focus rather on general country-level innovation indicators. To mend this gap and to provide a more specific framework to evaluate digital transformation in the healthcare and pharmaceutical industries, this study proposes a new model called the Digital Double Diamond (DiDD), which is an extension of Porter’s Diamond model for national competitiveness. The DiDD model consists of three factors: endogenous factor, centric factor, and exogenous factor containing nine variables and 36 sub-variables that capture the impact of digital transformation in healthcare and pharmaceutical industries to assess national competitiveness. The new DiDD model emphasizes the importance of having a balance between the traditional national competitiveness and digital convergence elements in the healthcare and pharmaceutical industries. As an illustration of the new DiDD model, we compare South Korea and Switzerland’s digital transformation competitiveness in the healthcare and pharmaceutical industries.