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Regular Paper A Theory of Enterprise Transformation A THEORY OF ENTERPRISE TRANSFORMATION William B. Rouse* Tennenbaum Institute, Georgia Institute of Technology, Atlanta, Georgia 30332 Received 28 April 2005; Accepted 22 June 2005, after one or more revisions Published online in Wiley InterScience (). DOI 10.1002/sys.20035 ABSTRACT The information technology revolution has driven the pace of competition and rapid globali- zation. Consequently, enterprises increasingly need to consider and pursue fundamental change—transformation—to maintain or gain competitive advantage. This need raises impor- tant research issues concerning how transformation is best understood and pursued. This paper outlines a theory of enterprise transformation to guide research on these issues. The theory focuses on why and how transformation happens, as well as ways in which transforma- tion is addressed and pursued in terms of work processes and the architecture of these processes. A variety of industry and corporate vignettes is used to illustrate the theory. A portfolio of research initiatives are discussed in terms of how they can advance the proposed theory, while also enhancing practices of enterprise transformation. © 2005 Wiley Periodicals, Inc. Syst Eng 8: 279–295, 2005 Key words: enterprise systems; enterprise transformation; strategic management; system of systems; architecture; decision making; social networks 1. INTRODUCTION and/or how the enterprise is organized to provide these

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