Abstract:    Due to the high-input and high-risk characteristics of digital transformation, enterprises are prone to fall into the dilemma of digital paradox. How to choose an appropriate digital strategy is a practical problem that needs to be solved urgently for enterprises. Based on the optimal distinctiveness theory and the behavioral theory of firms, this research explored the impact of performance feedback on selection of digital strategies, and further examined the moderating effect of formal and informal institutional pressures. This research selected Chinese A-share manufacturing listed companies as the research sample, and adopted the multi-dimensional fixed effect model and interaction effect model to test the research hypothesis. The empirical results showed that the social-desirability gap will have a negative impact on the digital exploitation strategy of enterprises, but a positive impact on the digital exploration strategy. Informal institutional pressure reinforces the negative impact of social-desirability gap on the digital exploitation strategy, while formal institutional pressure reinforces the positive impact of social expectation gap on the digital exploration strategy. This paper revealed the mechanism of selection of digital strategies, clarified the theoretical relationship between performance feedback and selection of digital strategies, and provided some management enlightenment for manufacturing companies to implement digital transformation.

Key words: digital strategy, optimal distinctiveness theory, performance feedback, institutional pressure