Association for Information Systems Association for Information Systems AIS Electronic Library (AISeL) AIS Electronic Library (AISeL) ECIS 2025 Proceedings European Conference on Information Systems (ECIS) June 2025 GOVERNMENT ROLES AND DYNAMIC CAPABILITIES IN DIGITAL GOVERNMENT ROLES AND DYNAMIC CAPABILITIES IN DIGITAL TRANSFORMATION PROJECTS TRANSFORMATION PROJECTS Duong Dang University of Vaasa, duong.dang@uwasa.fi Quang Neo Bui Rochester Institute of Technology, quang.neo.bui@gmail.com Son Pham Hanoi University of Industry, Vietnam, sonph@haui.edu.vn Tero Vartiainen University of Vaasa, tero.vartiainen@uwasa.fi Samuli Pekkola University of Jyvaskyla, samuli.j.pekkola@jyu.fi Follow this and additional works at: https://aisel.aisnet.org/ecis2025 Recommended Citation Recommended Citation Dang, Duong; Bui, Quang Neo; Pham, Son; Vartiainen, Tero; and Pekkola, Samuli, "GOVERNMENT ROLES AND DYNAMIC CAPABILITIES IN DIGITAL TRANSFORMATION PROJECTS" (2025). ECIS 2025 Proceedings. 5. https://aisel.aisnet.org/ecis2025/smart_gov/smart_gov/5 This material is brought to you by the European Conference on Information Systems (ECIS) at AIS Electronic Library (AISeL). It has been accepted for inclusion in ECIS 2025 Proceedings by an authorized administrator of AIS Electronic Library (AISeL). For more information, please contact elibrary@aisnet.org. https://aisel.aisnet.org/ https://aisel.aisnet.org/ecis2025 https://aisel.aisnet.org/ecis https://aisel.aisnet.org/ecis https://aisel.aisnet.org/ecis2025?utm_source=aisel.aisnet.org%2Fecis2025%2Fsmart_gov%2Fsmart_gov%2F5&utm_medium=PDF&utm_campaign=PDFCoverPages https://aisel.aisnet.org/ecis2025/smart_gov/smart_gov/5?utm_source=aisel.aisnet.org%2Fecis2025%2Fsmart_gov%2Fsmart_gov%2F5&utm_medium=PDF&utm_campaign=PDFCoverPages mailto:elibrary@aisnet.org%3E Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 1 GOVERNMENT ROLES AND DYNAMIC CAPABILITIES INDIGITAL TRANSFORMATION PROJECTS Completed Research Paper Duong Dang, University of Vaasa, Finland, duong.dang@uwasa.fi Quang “Neo” Bui, Rochester Institute of Technology, United States, qnbui@saunders.rit.edu Son Pham, Hanoi University of Industry, Viet Nam, sonph@haui.edu.vn Tero Vartiainen, University of Vaasa, Finland, tero.vartiainen@uwasa.fi Samuli Pekkola, University of Jyväskylä, Finland, samuli.j.pekkola@jyu.fi Abstract Digital transformation initiatives have been strategically deployed by governments to enhanceefficiency, increase digital competitiveness, and gain leverage internationally. While previous studieshave examined government roles in IT transformation initiatives, they often focus on specific settingsdue to the challenge of obtaining comprehensive data across multiple initiatives. This study advancesthe literature by using a dynamic capabilities and government roles perspective to analyze three digitaltransformation initiatives over a 20-year period in the healthcare sector. The findings propose a 2x2framework that generalizes government roles in digital transformation initiatives. Depending on theclarity of the problem and solution, three roles are identified: champion, corrector, and monitor. Wealso demonstrate how dynamic capabilities manifest differently for each role through three interrelatedprocesses: digital infrastructure, digital competence, and digital governance transformation. Keywords: Government Roles, Digital Transformation, Dynamic Capabilities, Case Study 1 Introduction In recent years, organizations have leveraged cloud computing, social media, virtual reality, machinelearning, and artificial intelligence (AI) to transform their operations and enhance their competitiveness(Chasin et al., 2022). This phenomenon is referred to as digital transformation (DT) (Ologeanu-Taddeiet al., 2025). Within the public sector, digital transformation is defined as “changes introduced by theimplementation of digital technologies in the public sector” (Afzal & Panagiotopoulos, 2024, p. 1). DTinitiatives have also been launched by numerous countries to bring governments closer to citizens andbusinesses (OECD, 2023). For example, Spain, Japan, and the UK have implemented data-sharinginitiatives (e.g., Spain’s National Data Intermediation Platform, Japan’s Co-operation Network Systemfor Personal Information, The UK’s National Data Library) to enhance service quality and promoteinnovation through data-driven insights, as well as to foster partnerships between public and privatesectors (OECD, 2024). These examples illustrate that countries are investing in DT initiatives not onlyto provide more accessible and meaningful services to their customers but also to enhance their strategicleverage (ECDC, 2021). Despite the strategic value of DT initiatives, the topic has been little studied in the e-government context(Danielsen et al., 2022), particularly regarding government involvement (Gil-Garcia et al., 2021). DTinitiatives are inherently disruptive and require significant strategic involvement from the government(Carter et al., 2024). This most likely necessitates a combination of different government roles when itadvances DT. Yet, the literature has largely been silent on these roles and their evolution, as most studiesfocus only on specific contexts and initiatives, and at a given moment of time. For example, governments Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 2 can adopt a top-down approach, imposing initiatives (e.g., UK digital identify initiative) (OECD, 2024),or a bottom-up approach, reaching consensus with the population (e.g., Vietnam enterprise architectureinitiative) (Dang & Pekkola, 2023). The government can be active, anticipating future problems (e.g.,climate change policy), or reactive, responding when problems reach a critical level (e.g., Covid-19lockdown in China) (Li, 2021). Existing studies primarily focus on either the relationship between the government and other actors inthe policymaking process (a problem dimension), or the government’s approach to solving societalproblems (solution dimension) (Richardson, 2013). How government roles fluctuate across these twodimensions has not been studied. For example, it is not known how governments adapt differentapproaches or aggregate them to overcome challenges such as the digital illiteracy of the population orlack of digital competence among leaders (ECDC, 2021). Furthermore, recent studies have suggestedthe importance of dynamic capabilities in successful DT initiatives (Chatfield & Reddick, 2019; Soluk& Kammerlander, 2021; van Noordt & Tangi, 2023; Yeow et al., 2018). Building on thesedevelopments, this paper addresses the research gap. We examine the evolution of government roles anddynamic capabilities in national DT initiatives to uncover how governments overcome the challengesassociated with new DT initiatives, aiming to improve service delivery and digital competitiveness. Wethus answer the following questions: (1) What roles do governments play in national DT initiatives?And (2) How are dynamic capabilities manifested under different governmental roles? To address these research questions, we employed an embedded single case study approach, utilizingthe roles of government and dynamic capabilities as our theoretical lenses. In particular, throughembedded cases of three national electronic health (eHealth) initiatives over 20 years in Vietnam, weillustrated an evolution of Vietnamese government roles from monitoring the DT initiatives to being acorrector and eventually a champion. Throughout this process, the dynamic capabilities of thegovernment and organizational-level health facilities manifested differently. Furthermore, there arethree interrelated transformation processes unfolded in each government role: the transformation of thedigital infrastructure (that exemplifies the digital divide of developing countries), of the stakeholders’digital competence, and of the digital governance of the government regarding DT initiatives. Theinterplay of these three transformation processes impacts how the government roles evolve over time. 2 Theoretical Background 2.1 Digital Transformation Stages in the Public Sector DT initiatives are widely recognized as lengthy and challenging endeavours, with only approximately15 percent of such projects deemed successful (Adelakun et al., 2025). Despite these challenges,governments worldwide are increasingly harnessing digital technologies to revolutionize servicedelivery and enhance citizen engagement (Mergel et al., 2019). Consequently, numerous DT initiativeshave been implemented globally (OECD, 2021). These initiatives not only enhance governmentalservices but also strengthen strategic positions and digital competitiveness. In the public sector, theliterature indicates a paucity of research on digital transformation within this context (Danielsen et al.,2022). The literature further delineates three stages of digital transformation: digitization, digitalization,and digital transformation (Adelakun et al., 2025; Verhoef et al., 2021). These stages coexist and aredefined as follows: digitization refers to the conversion of analog information into digital format;digitalization signifies the process and sociotechnical changes that alter existing business models; anddigital transformation denotes radical and significant changes at organizational, strategic, and societallevels (Adelakun et al., 2025; Danielsen et al., 2022). This study examines the digital transformationprocess in the healthcare sector, encompassing the three stages within an embedded single case studythat comprises the implementation of three nationwide eHealth initiatives. 2.2 Digital Transformation and Dynamic Capabilities Prior studies have employed the dynamic capabilities theory to understand how organizations create andmaintain digital competitiveness through digital transformation (Soluk & Kammerlander, 2021; Yeow Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 3 et al., 2018). Within the public sector, researchers have increasingly scrutinized the link between digitalcapabilities and government service performance. For instance, Chatfield and Reddick (2019) found thatInternet-of-Things-enabled dynamic capabilities can lead to better smart government performance. vanNoordt and Tangi (2023) showed that e-government capabilities are crucial to developing AI capabilityfor public administrations. While useful, the number of these studies remains modest, and there is noclear understanding yet of how such dynamic capabilities developed over time, and what are thegovernment roles during the process. Thus, in this study, we employ dynamic capabilities theory tounderstand how government roles and dynamic capabilities evolve for digital transformation in thepublic sector. Dynamic capabilities theory posits that to create sustainable performance, an organization needs to buildits dynamic capabilities through three main activities: sensing new opportunities and threats, seizingopportunities by taking action, and transforming its structures and processes to remain relevant (Teece,2007). Prior studies have shown that sensing, seizing, and transforming are important activities to builddigital capabilities in DT initiatives (Soluk & Kammerlander, 2021). Furthermore, successful initiativesalso requires three interrelated transformations: the transformation of digital infrastructure surroundingthe initiative (OECD, 2024), the transformation of digital competency of the involved stakeholders(Eden et al., 2019), and the transformation of digital governance of the organization (Chatfield &Reddick, 2019). These transformations form a triangle of constraints that guide how governments andorganizations should approach the DT initiatives. Three transformations also guide the governments tomanage the DT challenges and balance between maintaining current operations and pursuing acomprehensive transformation of the organization (Poláková - Kersten et al., 2023). First, DT requires an evolution and a transformation of digital infrastructure surrounding the initiative.Digital infrastructure refers to “the basic information technologies and organizational structures, alongwith the related services and facilities necessary for an enterprise or industry to function” (Tilson et al.,2017, p. 748). Digital infrastructure is considered one of the most critical challenges in theimplementation of DT initiatives in developing countries (Bélanger & Carter, 2009). This was evidentwith the Covid-19 pandemic: many countries were struggling to transform their public services to online(Ndou et al., 2023). Second, DT requires a transformation of the stakeholders’ digital competences.Digital competence is understood as a set of fundamental knowledge, skills, and abilities required forthe effective use of ICT and digital technologies in performing professional duties (Oberländer et al.,2020; Ochoa Pacheco & Coello-Montecel, 2023). National DT initiatives necessitate the transformationof the stakeholders’ competences (Alrasheedi et al., 2022). For example, policy makers need a visionarydigital mindset to leverage technologies (Kane et al., 2019). End-users need support to become digitallyliterate and adopt new technologies. Increasing digital competence is a critical step for DT initiatives(Gjika & Pano, 2023). Third, DT requires a transformation of digital governance. Digital governance isdefined as “digital technology ingrained in structures or processes of governance and their reciprocalrelationships with governance objectives and normative values” (Engvall & Flak, 2022, p. 44). Priorstudies have discussed some forms of government for successful DT outcomes, such as the sharedgovernance approach (Eden et al., 2019) or the top-down approach (Kane et al., 2019). Taken together,these studies suggest that government should be aware of different policies in governing the DTinitiatives, and be able to evolve its policies to fit the contingencies (Denford et al., 2024). 2.3 Government Roles in National Initiatives It is self-evident that government plays a critical roles in establishing the dynamic capabilities andsuccess of national DT initiatives (Chatfield & Reddick, 2019; van Noordt & Tangi, 2023). Extantresearch suggests that government roles in implementing national IT initiatives can be divided into top-down, bottom-up, or hybrid approaches. A top-down approach is centralized, with the centralgovernment leading and other agencies participating in an initiative (Long & Franklin, 2004). One suchexample is Norway’s National Joint Solutions initiative, led by the Norwegian Agency for DigitalGovernment in collaboration with other agencies (OECD, 2024). In contrast, a bottom-up approach isdecentralized, with the central government negotiating with its stakeholders to identify and implementinitiatives. For instance, Vietnam’s enterprise architecture initiative involved local governments and Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 4 agencies (Dang & Bui, 2023; Dang & Pekkola, 2023). A hybrid approach combines top-level guidancewith bottom-level expertise (Goggin et al., 1990; Long & Franklin, 2004). An example is the U.S.ARPANET, involving multiple government levels, academia, the military, and businesses (Aldrich etal., 2002). In addition, action-level roles have been identified, such as monitoring growth, developingframeworks, and managing growth processes (Li, 2021), or governments can also act as innovators orsponsors if highly interested in the innovation (Moon & Bretschneider, 1997). Richardson (2013) summarized government approaches and actions using two dimensions. On therelational dimension, governments can take a top-down (imposing) or bottom-up (consensus) approachto policymaking. A top-down approach involves the government determining and imposing policydetails, while a bottom-up approach involves working with the population to reach consensus. On theproblem-solving dimension, governments can be proactive or reactive. A proactive stance involvesleading initiatives in anticipation of future problems (e.g., climate change policy), while a reactive stanceinvolves responding to problems only when they become critical (e.g., COVID-19 lockdown in China).These dimensions define government styles based on the relationship between the government and otheractors in policymaking, and the government’s approach to solving societal problems (Richardson, 2013). 3 Methodology 3.1 Research Settings and Case Background We used an embedded single case study approach (Yin, 2009) to document the digital transformationjourney of the Vietnamese healthcare sector over two decades. In our data, the unit of analysis in thesingle case is the digital transformation process in the Vietnamese healthcare sector, and the unit ofanalysis in the subunits is the implementation of three nationwide eHealth initiatives (e.g., digitalizedhealthcare systems) in different times and contexts. The selection of the case was motivated by theunique opportunity for “unusual research access” (Eisenhardt & Graebner, 2007, p. 27) to access a richand long set of case study data through personal connections of one of the authors. Additionally,Vietnam was considered one of the most aggressively digitalized countries in Southeast Asia (ECDC,2021), thus representing a theoretically interesting case that can unveil how the role of the governmentunfolded in the digital transformation process. The World Health Organization (WHO, n.d.) defines eHealth as “the cost-effective and secure use ofinformation and communications technologies in support of health and health-related fields, includinghealth-care services, health surveillance, health literature, and health education, knowledge andresearch”. National eHealth initiatives refer to a large-scale eHealth project or plan at the national levelthat may contain several sub-projects or sub-plans (Warth & Dyb, 2019). We chose Vietnam usingpurposeful sampling reasons: (a) DT is in a strategic focus of the Vietnamese government, and (b) wehad an opportunity to observe three different eHealth initiatives, constituting comprehensivetransformations of the healthcare sector. Three initiatives are the National Telehealth Initiative (NTI),National Admin Health Information Technology (NHIT) Initiative, and National Clinical HIT (NCHIT).These were chosen because they offer insights into the impact of DT on a wide range of stakeholders,ranging from users to government to society. This thus helped us to understand and unlock thegovernance style of DT. In terms of DT stages, the NTI is more of a digitization of healthcarecommunication, while the next two initiatives are digitalization of administrative and clinical healthcarefunctions. DT in Vietnam has undergone three distinct periods. In the first period, which we calls Exploration(2001-2007), Vietnam initiated “Project 112” to informatize public services and establish nationaldatabases (Gov. 112, 2001). This initiative was managed in a top-down manner with strong politicalsupport but ultimately failed to meet its objectives, leading to its abrupt halt in 2007. In the secondperiod, Exploration and Experiment (2008-2017), the government cautiously launched new DTinitiatives, due to the failure of Project 112. During this time, a bottom-up approach was adopted, withlocal authorities managing projects and a National Steering Committee providing advice. This periodsaw smaller, short-term projects in the first half and larger, long-term projects in the latter half. The third Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 5 period, Acceleration (2018-present), has seen Vietnam, under the leadership of the Ministry ofInformation and Communications (MIC), accelerating towards a genuinely digital nation. This period ischaracterized by flexible management styles, including top-down, bottom-up, or hybrid, depending onthe DT initiative. The public healthcare sector in Vietnam is organized into four levels. Level 1 includes hospitals andother HFs that are supervised by the Ministry of Health (MoH), level 2 by the Department of Health,level 3 by the District Health Bureau, and level 4 by the commune health center. The governmentoperates hierarchically, with shared responsibilities across levels. DT in the Vietnamese healthcaresector followed in lockstep with the national-level initiatives. No DT initiatives were observed in thehealthcare sector during the first period (Exploration 2001-2007). However, the subsequent period sawthe MoH introducing initiatives to promote IT applications (2008-2010) and digitization (2011-2017).Building on this, the MoH introduced an IT-wide architecture in the third period to accelerate DT in thehealth sector. 3.2 Data Collection Our data include interviews, secondary data, and observations (Table 1). Different sources help us totriangulate the sources and further assure the validity of the study (Creswell & Miller, 2000). Weadopted an opportunistic approach to data collection as one of the authors had worked with peopleinvolved in the eHealth initiatives and therefore was able to interview them and to access internaldocuments. After the first round of interviews, we used a snowball technique in which we asked theinterviewees to point to other people who had appropriate knowledge of the initiatives. Altogether weconducted 45 semi-structured interviews with the MoH, the MIC, eHealth initiatives partners (e.g.,vendors/developers, services providers, advisers), and eHealth initiatives users (e.g., health facilities -HFs, patients). Our interviews took place between January 2020 and January 2021. Conducted inVietnamese, these lasted between 26 and 113 minutes, with an average length of 39.6 minutes. Follow-up questions were asked via telecom software, email, and through informal dialogue during the dataanalysis process. We also collected secondary data: internal documents, project documents, meetingmemos, press releases, conference materials, and online materials, related to the initiatives. In total, wecollected more than 125 documents comprising about 10,000 pages. Types Data sources Semi-structuredinterviews MoH: 6 Interviewees MIC: 8 Interviewees eHealth initiative partners: 12 Interviewees eHealth initiative users: 19 Interviewees Secondary data Policies, memos, project documents: 125 documents (10,000+ pages) Observations Debrief meeting and online workshop: 2 sessions (4 hours 15 minutes) Follow-up interviews MoH and MIC: 2 Interviews (40 minutes) Table 1. Data types and data sources of the study. We also conducted two observation sessions to capture the development process of the initiatives (seealso Orlikowski, 2007). The first 75-minute session in January 2019 consisted of two governmentofficers in charge of managing IT applications in state agencies, three developers representing threeinitiatives, one service provider, two users, and two researchers. An officer briefed us on the initiativestatus and summarized the key activities. The second session, a three-hour online workshop in December2020, focused on national eHealth initiatives with six government officials, three CIOs, 10 HealthFacility (HF) representatives, and two users. The aim was to review the development of NHIT and planfor the future. In both sessions, extensive field notes and photographs, when permitted, were taken. Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 6 3.3 Data Analysis We followed Eisenhardt's (1989) guidelines for the data analysis. First, we constructed a within-casestudy write-up to gain an overview of the timeline and refine the data collection process. The key eventsfrom the interviews and secondary documents were summarized. This reduced the number of pages tomanageable amounts and helped us to identify key points. Two authors discussed the cases weekly untilwe reached a saturation point in the case understanding. This provided us in-depth understanding of thecases and their main events. We also ensured the consistency and reliability of data analysis bydiscussing the meaning of data among researchers. The interviews and secondary data were handled byat least two authors. Key quotations, events, and timelines were documented in a file so that they werechecked by at least two researchers. In the second phase, we followed a theory-driven coding approach (Yin, 2009) to analyze each case bythe analytical framework, constructed from the theoretical background above. In particular, theinterviews and secondary data were imported in NVivo software. The two coders discussed and lookedfor evidence in interviews that explained each case on the different theoretical dimensions. Secondarydata were also used when necessary to corroborate evidence from interviews. Specifically, for each case,we traced and identified the following: (a) Government activities: we identified what happened in eachcase using the seizing, sensing, and transforming categories from the dynamic capabilities theory; (b)Dynamic capability settings of the DT initiatives which can be characterized by three dimensions: thestatus of the digital infrastructure, the usage of data standards, and the utilization of the initiatives amongthe stakeholders; and (c) Government roles: we classified the government roles in each eHealthinitiative. The government roles were characterized by two dimensions: relational dimension (top-downvs. bottom-up) or problem-solving dimension (active vs. reactive). Finally, we synthesized the findings across the three cases for theory-building purposes (Yin, 2009).This was an iterative process in which the researchers engaged in weekly discussions over the casewrite-up and synthesized the findings and connected them to the literature. It is important to note thatthis was a cross-case synthesis, not a cross-case comparison in which researchers look for patterns andsimilarities (Eisenhardt, 1989). Instead, the cross-case synthesis focuses on the evolution of differentcase elements over time and generalizes them to theory. 4 Findings 4.1 National Telehealth Initiative (NTI) Starting from 2006, the NTI commenced to establish a telehealth platform in Vietnam, covering threegovernmental levels in the healthcare sector (levels 1-3). Its development can be divided into two periods(Table 2). In the first period (2006-2016), the goal (sensing) was to enhance medical capacity in lower-level hospitals, reducing the burden on national-level hospitals. The motivations were explained below:“Telehealth was established at our hospital to connect with six level 2 hospitals in the Red River Deltaand Northern Midlands of Vietnam. The goal was to enhance medical capacity, improve the quality andexpertise of local doctors, and ensure patients receive high-quality treatment locally” (Director, VDHospital). National hospitals seized the opportunity to work with lower-level hospitals and IT vendorsto transform their operations. IT vendors fully operated the telehealth system, providing networks,devices, and support. However, during this period, digital infrastructure was poor, with less than 30% of the populationhaving internet access and less than 10% with high-speed broadband. This made setting up telehealthsystems costly and cumbersome. The director of VD Hospital, the leading hospital in the initiative,commented: “Preparing for a telehealth surgery session took about two weeks and required over 100technicians and staff to ensure smooth operation” (Director, VD Hospital). The lack of digitalgovernance made it difficult to ensure consistent quality across telehealth centers. One physiciancommented: “During this period, telehealth centers were established mainly by purchasing equipmentand software, but there was a lack of government policies and operating mechanisms” (Physician – BSDTH, N Hospital). Lack of digital competence was evident, as noted by the Vice Director of the Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 7 Electronic Health Administration (EHA): “‘It’s the first step that counts.’ It was a “learning by doing”approach. We implemented telehealth, learned from it, improved, expanded, and addressed challengesas they arose” (Vice Director, EHA). Thus, we can classify the government role during this period asminimal. Due to these characteristics, few telehealth centers were established. By 2016, only 23 out ofover 1,500 hospitals had joined the initiative, with 600 telehealth sessions conducted. In the second period (2017-current), the government sensed the significant advantages of DT inhealthcare and seized the opportunity with a strong push. They launched a National DT Program in 2020(Gov. 749, 2020). The MoH transformed this initiative, advancing remote medical examination andtreatment (MoH 2628, 2020). The COVID-19 pandemic further drove this transformation, as lockdownscreated a pressing need for telehealth. One vendor director stated: “We had to reallocate all companyresources to respond to the COVID-19 emergency, the way of doing things must be different [...] Settingup telehealth at DHY hospital and satellite hospitals took just one week, compared to the usual twoyears” (Director, Vendor’s Solution Department). The digital infrastructure witnessed a drastic change. From 2006 to 2016, the Internet subscribers inVietnam tripled from 17.25% to 53%, with nearly half the population gaining high-speed access. Thismeans the population is more comfortable with using IT to access health services. During this period,hospitals also adopted AI, data analytics, and IoT, enhancing security and migrating services to thecloud. Regarding digital governance, the government issued standards and regulations for telehealth,such as criteria for IT applications in HFs and regulations on telemedicine activities, such as principlesof telehealth operation, technical requirements for telehealth activities, general expertise requirementsfor telehealth, and telehealth operations fees (MoH 49, 2017; MoH 54, 2017). These activities rapidlyexpanded the NTI. One physician commented: “Vietnam currently has favourable conditions fordeveloping telehealth services. Our telecommunications are among the best in Southeast Asia. We haveregulations and initiatives for telehealth. We have tested and confirmed the effectiveness of telehealthservices” (Physician, E Hospital). In terms of digital competence, telehealth adoption was slowlychanging the habits of citizens and physicians, from traditional to online consultation. The interviewercommented: “The biggest challenge in implementing telehealth is not the technology, but changing thehabits of patients and doctors from face-to-face to online consultations” (Director, Vendor 2’s SolutionsDepartment). During the period, the government’s role was to issue policies and legitimize practices.By the end of 2021, NTI connected all HFs (levels 1 to 3). Telehealth sessions became routine forconsultations, medical examinations, treatment, and training. In 2022 alone, there were 3,000consultations, over 1,100 medical examinations, and 32,000 sessions. Element First period: 2006-2016 Second period: 2017-current Sensing To improve medical capacity inlower-level hospitals. To take advantage of DT in healthcare. Seizing Hospitals worked with vendors toimplement their initiative. Government pushed for DT initiatives in thehealthcare sector. The Covid-19 pandemicaccelerated the adoption of telehealth.Transforming IT vendors supplied equipment andset up infrastructure. Telecommunication with high-speed Internet accesswith significant improvements. Digitalinfrastructure Capability of the hospitals is limited.Internet was underdeveloped makingthe connection quality unreliable.unreliable. Capability of the hospitals is improved. Internet was improved; high-speed Internet is moreaccessible. Telehealth services are consolidated andmigrated to cloud servers. Digitalgovernance There were no policies, operatingmechanisms, and standards fortelehealth. Various policies on DT and telehealth: The 2020National Digital Transformation Program (Gov. 749,2020), set of criteria for IT applications in HFs (MoH54, 2017) and regulation on telehealth activities(MoH 49, 2017). Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 8 Digitalcompetence Lack of IT skills and trainingopportunities. Changing the habits of users and health providers touse telehealth. GovernmentRoles None. Issued policies to legitimize the practices. Table 2. Development of the national telehealth initiative. 4.2 National Admin HIT Initiative (NHIT) Started in 2017, the NHIT aimed to establish a platform of about 12,000 HFs at the commune level.NHIT development can be divided into two periods (Table 3). In the first period (2017-2019), thegovernment sensed that these health stations play a vital role in delivering public healthcare services.The MoH seized this opportunity by focusing on digital governance, such as guidelines for HFs’ back-office systems, and set criteria for IT applications (MoH 54, 2017; MoH 6110, 2017). The guidelinesmandated a minimum of 20 functions for HIT, including infrastructure, security, and resourcerequirements. This transformed HFs’ admin HITs, allowing them to develop their own HITs as long asthey met the MoH’s requirements. This led to a proliferation of admin HIT systems due to different ITvendors and a lack of data sharing (digital competence), as voiced by an interviewee: “We have about12,000 level 4 HFs. All activities were paper-based years ago. Despite IT improvements from 2017-2019, the ISs were not interconnected, making management difficult” (Chief of Office of MoH). In termsof digital infrastructure, the ISs adopted either a standalone or a client-server architecture but lackeddata-sharing standards. This lack of interoperability caused management issues. A physician said: “Thehealth station implemented admin HITs. They improved efficiency. The problem was that there weremany HIT systems that were not connected with each other” (Physician S4, P1 Health Station, T District,H province). By 2019, the HFs had an average of 11 distinct HIT systems, each handling specific tasks. In the second period (2020-current), the government sensed the need to address interoperability issues.They seized this by issuing a decision (MoH 3532, 2020), mandating admin HITs to share data acrossall levels (Level 4 to Level 1). The EHA agency ensured HIT interoperability, and the MoH issued adata format standard for data exchange (MoH 198, 2021) (digital governance). They transformed bydeveloping V20, a national admin HIT platform for all HFs, consolidating real-time patient data forquicker decisions and data flow from commune to national levels. In terms of digital infrastructure, theV20 platform used cloud-based technologies, making deployment easy. It integrated with otherdatabases and systems, such as the MoH Data Portal and banking payment systems, offering versatilityfor HFs. An interviewee commented: “Previously, using multiple admin HIT systems was inconvenientand time-consuming. The V20 platform benefits healthcare staff, state agencies, and patients. It connectseverything automatically, linking all levels from the commune to the MoH. It also saves patients timeand offers convenience by connecting with systems like health insurance and health records” (Nurse,DL, NB province). During this period, the government role was mostly focusing on issuing data formatstandards to increase interoperability across all admin HIT systems. By 2021, around 10,600 of 12,000HFs were connected via V20. However, challenges like incomplete module deployment, inability toconnect to other platforms (e.g., national immunization databases or WHO-supported platforms), andvarying IT skills among staff persisted (digital competence). Element First period: 2017–2019 Second period: 2020–present Sensing Government identifies DT in HFs is thebackbone of national healthcare reform. Lack of interoperability among admin HITsystems. Seizing Government pushed for the digitalizationof administrative tasks in HFs. Government addressed the lack ofinteroperability among admin HIT systems. Transforming Each health station implemented its ownadmin HIT system which used either astandalone or a client-server architecture. A national admin HIT platform named V20 wasdeveloped using digital technologies (cloud-based). Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 9 Digitalinfrastructure A standalone or a client-serverarchitecture, but lacked data-sharingstandards Digital technologies were used (cloudarchitecture). Digitalgovernance Guidelines and criteria in the developmentof admin HIT systems (MoH 6110, 2017;MoH 54, 2017). The EHA of MoH led the development of anadmin HIT system. New guidelines that regulatethe interoperability of admin HIT systems inHFs (MoH 3532, 2020). Digitalcompetence Proliferation of admin HIT systemsdeveloped by HFs that lackinteroperability. I.e., by 2019, on average,each health facility had 11 different adminHIT systems. Incomplete deployment of all modules of theplatform, inability to connect to other platforms,unequal IT skills among staff or outdatedcomputers at the HFs lead to incomplete dataand poor usage. GovernmentRoles Admin HIT requirements and functionswere guided by MoH. No specificstandard for the platform interoperability. MoH standardized data formats in order toconnect any admin HIT to only one platform. Table 3. Development of national admin HIT initiative. 4.3 National Clinical HIT Initiative (NCHIT) In 2018, the NCHIT started to digitize patient health records in level 1 to 3 hospitals. The governmentsensed NCHIT as a way to enhance digital competitiveness and streamline healthcare management withdigital technologies. The government seized this opportunity by issuing a circular outlining the scope,legalities, principles, and standards for electronic medical records, digital signatures, andprivacy/security standards (MoH 46, 2018). They also defined the government’s role in establishing theNCHIT and set data format and exchange standards, acknowledging international health data standards(MoH 3926, 2017; MoH 7713, 2007). The 2018 Circular mandated compliance with these standards,enabling different clinical HIT platforms to share data. However, only subsets of health records can beshared for reuse or research (digital governance). In that sense, the government played a hybrid role,pushing incentives and strategic drivers while leaving development to HFs. Unlike the admin HITinitiative, a council certifies local clinical HIT compliance with government guidelines, comprisingofficials and healthcare professionals from all healthcare levels. The process is described by aninterviewee: “Our Electronic Medical Record system was evaluated in February 2020 by theProfessional Council, led by the Department of Health in QN Province. Based on MoH policies, ourEMR met 5 out of 7 criteria, making us one of the first level 3 hospitals in the province to replace papermedical records” (Vice Director, HH District Health Center, QN, level 3 hospital). Regarding the digitalinfrastructure, the government now owns only the data, outsourcing digital infrastructure to IT vendorswho have improved their HIT platform capabilities. Vendors set up cloud-based infrastructure anddeveloped algorithm-based decision support systems. AI synthesizes medical records for regimens andprognosis suggestions, and scanned images to train AI models for disease suggestions like pneumonia.These applications have enhanced platform attractiveness. In terms of digital competence, the lack ofcommitment from health facility leaders persists. Others include staff behaviour change, IT staffqualifications, and uneven infrastructure development, all affecting clinical HIT implementations:“Implementing NCHIT changes working habits, requiring strong leadership and staff participation. HFsare confused about necessary investments and upgrades due to asynchronous digital infrastructure”(MoH Report, 2020). To improve digital competence, stakeholders such as the government, the MoH,IT vendors, and healthcare facilities (HFs) were involved. For instance, the MoH and the Department ofHealth have organized symposiums to assist HFs: “Assigning responsibilities, particularly to leaders,aids DT acceleration and system use. The ‘Small rain lays great dust’ approach suggests that users areconvinced by the benefits of clinical HIT over time” (Vice Director General K3, K Hospital). Element 2018–present Sensing Enhance digital competitiveness and streamline healthcare management. Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 10 Seizing Government pushed for the use of electronic medical records in the healthcare sector. Transforming The government transitions to “owning data” while leaving the specifics of digitalinfrastructure of the platforms to IT vendors. The government issued regulations andstandards, while the HFs have the flexibility to develop and implement their own system.However, a professional council will assess whether the clinical HIT platforms meetgovernment requirements. Digitalinfrastructure Digital technologies and software-as-a-service models were adopted. Advancedtechnologies such as algorithm-based decision support systems were integrated to improvethe decision-making process. Digitalgovernance MoH outlined the scope, legalities, principles, and standards for electronic medical records,picture archiving and communication systems, digital signatures, and privacy/securitystandards, as well as indicated the role of the government (e.g., agencies under the MoH) inestablishing the NCHIT. Recognized and adopted international standards (e.g., HL7,DICOM) (MoH 3926, 2017; MoH 7713, 2007). Digitalcompetence Lack of commitment from healthcare facility leaders. Challenge to changing working habitsof the healthcare staff. Lack of IT skills in healthcare facilities to implement and supportclinical HIT platforms. GovernmentRoles MoH issued guidelines, and independent institutions checked compliance. Table 4. Development of national clinical HIT initiative. 5 Discussion 5.1 Government Roles in Digital Transformation Initiatives We synthesize our three cases to understand the evolution of government roles and changes in each case.In terms of the government roles, the government style in the telehealth initiative can be described as“government as a monitor” in which the government adopted a reactive problem-solving approach witha consensus relationship with hospitals. Specifically, the government was not involved, leavingtelehealth platform development to the hospitals. The government then changed its role and acceleratedthe implementation of telehealth by issuing guidelines, but hospitals still controlled development andimplementation. Throughout, the government monitored and intervened only when necessary. On theother hand, for the admin HIT initiative, the government style can be described as “government as acorrector”. First the government let the HFs develop their own platforms but then it stepped in withrevised standards and a government-supported platform to address their proliferation and their lack ofinteroperability. In the clinical HIT initiative, a “government as a champion” style was adopted whenthe government took the lead right away. It was still a hybrid approach where the government onlydefined the functional requirements, data standards, and guidelines for development while the HFs hadflexibility to develop and implement their own platforms (Goggin et al., 1990; Long and Franklin, 2004). What (Problem) How (Solution) Problem clear Problem not clear Solution clear Government as champion Not empirically observed Solution not clear Government as corrector (Sandbox Approach) Government as monitor (Wicked Problem) Figure 1. The government roles in DT initiatives. Our synthesis findings show how the government roles evolved within and across the cases. We proposea 2x2 framework capturing these roles, the dimensions being societal problem clarity (the “What”: whatis the problem we are going to solve) and solution clarity (the “How”: how will we solve the problemusing DT solutions). Three cells are apparent in our cases, with one cell unobserved. However, it can be Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 11 questioned whether a solution there can ever be observed: knowing a solution to an unknown problemmight not be epistemologically right (Figure 1).First, if both the problem and the solution are clear, the government can act as a champion of DTinitiatives. This was the case of the NCHIT initiative. The need for the clinical HIT platforms was clearlyunderstood as part of the national DT initiative. Based on the lessons learned from the previous pilotprogram and from the NHIT initiative, the government also understood how the platform should bebuilt, and whether the necessary foundations for the platform existed (e.g., digital infrastructure was ingood shape, the stakeholders’ digital competence was high, and the government leaders were committedto the initiative). The government consequently issued functional requirements, data standards, and step-by-step guidelines to develop the platform. To avoid an extensive number of platforms as happened withthe NHIT initiative, the government set tight governance practices and data standards for data formatand data exchange and focused on owning data. The HFs were free to develop and implement their ownclinical HIT platforms as long as they followed the government guidelines. Second, if the problem is clear but the solution is not clear, the government can adopt a sandboxapproach and act as a corrector of DT initiatives. The sandbox approach refers to an environment inwhich the government permits limited actions in developing DT solutions with relaxed regulatoryconstraints and limited customers (tests-trails), and minimizes the risk of restricting policies andenforcement action (Allen, 2019). This resembles the “let a hundred flowers bloom” philosophy(Nadkarni & Prügl, 2021). With the sandbox environment, if any unintended issues emerge, thegovernment can step in as a corrector and regulate the DT solutions. This happened with the NHITinitiative. The government was setting up regulations on the functional requirements of the NHIT sothat the HFs can implement their own admin HITs accordingly. The problem of extensive proliferationof individual platforms without interoperability abilities emerged. There were no standards for dataexchange in the regulations. The government had to act as a corrector, interfere with a top-downapproach, and consolidate all admin HITs to one platform (i.e., V20 platform). Third, if neither the problem nor the solution is clear, the government can only monitor the DTinitiatives. We refer to this as a “wicked problem”: the DT initiative problem is ill-defined, but lacks anauthoritative set of rules, criteria, or methods (Coyne, 2005), or has unclear definitions, causalcomplexity, or conflicting goals (Denford et al., 2024). In this situation, the government can rely onlyon the consensus to make sense of and organize the solution. The NTI initiative is an example of thisstyle. At the beginning, the government was inactive in problem solving but sought consensus with thestakeholders to leave the development to hospitals. The government chose this approach because thedigital infrastructure was underdeveloped, there was a lack of digital competences across the population,and the government officials were not competent in regulating the DT initiatives. Only after thosereasons were acknowledged, the government was able to issue policies that helped to accelerate thetelehealth adoption. Our 2x2 framework conceptualizes the roles for the government under different circumstances. Thiscontributes to DT initiative studies often just describing the government involvement rather thanfocusing on why certain governance styles take place (King et al., 1994; Li, 2021; Moon &Bretschneider, 1997; Richardson, 2013). We also note that it is possible that the government takesdifferent roles within the same initiative or changes their roles over time. We thus invite future studieson this topic. 5.2 Dynamic Capabilities and Government Roles We further conducted a cross-case synthesis of three cases to understand how dynamic capabilitiesmanifested in different government roles, particularly regarding digital governance, digitalinfrastructure, and digital competence (Table 5). Each government role has unique conditions of DTelements and the manifestation of dynamic capabilities. We contribute to studies on dynamic capabilitiesby illustrating how the manifestation of dynamic capabilities in DT initiatives is characterized by thethree interrelated transformation processes of digital governance, digital infrastructure, and digitalcompetence. Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 12 Element Government as a monitor(NTI) Government as a corrector(NHIT) Government as achampion (NCHIT) DynamiccapabilitiesManifestation Organizational-ledtransformation Starts at the organizationallevel with sensing and seizing,followed by transformation atboth government andorganizational levels. Government-initiated,organizational-driventransformation Begins with governmentsensing and seizing at theorganizational level, andtransformation at both levels. Government-ledtransformation Government initiatessensing, seizing, andtransforming. Healthfacilities simply followthe government’s lead atthe organizational level. Digitalgovernance From limited involvement toguideline-based governance: The government initially hadlimited involvement but laterissued guidelines to acceleratetelehealth adoption. From guideline-basedgovernance to reactive policygovernance The government initially setfunctional requirements withoutdata exchange standards,leading to a proliferation ofadministrative HIT platforms.Later, policies were introducedto address this issue. Starting by proactivepolicy governance The government setfunctional and datastandards, allowing HFsflexibility in platformdevelopment. Digitalinfrastructure From lagging behind in IT toadvancing digital technologiesinfrastructure: The digital infrastructureupgraded from lagging behindIT and low- to high-speedInternet with digitaltechnologies, supportingtelehealth throughconsolidated, cloud-basedservices. From standalone to digitaladvanced technologies: Most admin HIT systems werestandalone or client-serverbased, lacking interoperability.Later, the NHIT platform, beingcloud-based, allowed easydeployment and maintenance. Starting with digitaladvanced technologies: The government shiftedto owning only data,while vendors developedadvanced platforms withadvanced digitaltechnologies. Digitalcompetence From technical skilldeficiencies to socio-technicalskill gaps: Early implementation lackeddigital skills, relying onvendors' IT and infrastructure.Later, there were struggles inchanging user and healthprovider habits to usetelehealth. From socio-technical skill gapsto leadership and skillchallenges: There was a persistent lack ofIT skills among staff in HFs, aswell as struggles in changinghabits. Leadership and skillchallenges: Healthcare leaders lackedcommitment, staffstruggled to changehabits, and IT skills wereinsufficient. Table 5. Synthesis of government roles in connection of DT elements and dynamic capabilities. First, when the government acts as a monitor in DT initiatives, the dynamic capabilities process ischaracterized as organizational-led transformation. This process is initiated at the organizational levelas the health facilities sensed and seized the opportunity to start the NTI. Then, the process was followedby transformation at both the government and organizational levels when they work together to embracecloud solutions to NTI. In this instance, DT initiatives also trigger several transformations of dynamiccapabilities (Chasin et al., 2022). Specifically, digital governance evolves from limited involvement to Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 13 guideline-based governance. Digital technology progresses from lagging behind in IT to advancingdigital technologies infrastructure. Also, digital competence shifts from technical skill deficiencies tosocio-technical skill gaps. In that sense, digital infrastructure and digital competences, that were initiallyunderdeveloped, necessitated significant roles for digital governance. Second, when the government acts as a corrector in DT initiatives, the dynamic-capabilities process ischaracterized as government-initiated, organizational-driven transformation. This process begins withgovernment sensing the need for a NHIT, health facilities seizing the opportunity to implement newadmin HIT systems at the organizational level, and transformation of structures and processes at bothlevels. Three transformations happened: Digital governance evolves from guideline-based to reactivepolicy governance. Digital infrastructure transitions from standalone systems to advanced digitaltechnologies. Meanwhile, digital competence shifts from socio-technical skill gaps to leadership andskill challenges. Third, when the government acts as a champion in DT initiatives, the dynamic-capabilities process ischaracterized as government-led transformation. This process begins with the government initiatingsensing, seizing, and transforming. Health faculties simply follow the government’s lead at theorganizational levels. Unlike other cases, the three transformation processes are unfolding without theendings. Digital governance remains a proactive policy governance. Digital infrastructure begins withadvanced digital technologies, while leadership and skill challenges persist with digital competence.Nevertheless, these transformation processes have taken the lessons learned from the other two cases toimprove the dynamic capabilities of the government in guiding DT initiatives. 5.3 Practical Implications This study has several practical implications. First, our framework provides a guideline for governmentsto choose the right management approach for their DT initiatives. Literature has discussed the tensionsbetween a ‘let a hundred flowers bloom’ philosophy versus a ‘launch, learn, pivot’ philosophy in DTinitiatives (Nadkarni & Prügl, 2020). Our framework adds clarity to that discussion by showing thatthere is a right context for each and every approach. In other words, our framework provides theconfiguration of DT in the context of the governments. Second, we shed light on the relationshipbetween government roles, DT constraints, and dynamic capabilities’ operationalizations that provide atool to identify, prioritize, and strategize the DT initiatives actions. If the population is not digitallyliterate, the government can launch an initiative to address the issue. For example, Vietnam hasestablished community DT teams since 2021. This was considered a breakthrough and unique approachto improve the citizens’ digital competences. A community DT team was established in each village,with the core being the youth, to guide every citizen, especially elders, rural inhabitants, and ethnicminorities, to use the digital platforms. By August 2022, there were more than 45,500 teams withapproximately 220,000 members in Vietnam. 5.4 Limitations and Future Research The study is not without limitations. First, we adopted an interpretive research approach. This can besubjective. We have coped with this by giving illustrative examples and by using several approaches totriangulate the data. Second, we employed an embedded case study encompassing three eHealthinitiatives within a single country, which may constrain the generalizability of our findings to thespecific study context. For instance, the results of this study can be applied to other governmentalinitiatives in Vietnam, such as smart city initiatives (Dang, 2025), telecentre initiatives (Do et al., 2023;Thai et al., 2022), and various other governmental programs. Nevertheless, it is important to note thatour findings are more appropriately generalized to theoretical frameworks (Yin 2009) rather than takingthem to other contexts. This limitation opens opportunities for future research. Finally, healthcare wasnot to make direct economic profit in this study but to enhance medical capacity and access forvulnerable inhabitants. Consequently, economic factors have not appeared in our research. Government Roles and Dynamic Capabilities Thirty-Third European Conference on Information Systems (ECIS 2025), Amman, Jordan 14 6 Conclusion DT has been on the forefront of a new wave of governance for governments across the world. However,public sector DT is still in its infant stage. There is a lack of comprehensive understanding of strategiesneeded in the policy, management, and infrastructure to successfully implement DT initiatives. In thisstudy, we examined three DT initiatives transforming the healthcare sector in Vietnam. We uncoveredhow the Vietnamese government coped with several challenges with its initiatives when improvingservice delivery and digital competitiveness. Our findings provide insights into strategically choosingthe right approach for a given DT initiative. The findings thus are valuable for countries and theirgovernments seeking approaches to implement their DT initiatives. Acknowledgements. 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