Quo Vadis (IT) Strategy? Rethinking Strategy Within Digital Logic

A growing consensus holds that digital strategy is business strategy. Yet, scholarship on the digital-strategy nexus lacks a first-principled definition of digital strategy, one grounded in the unique ontology of digital objects and a framework to conceptualize it in a manner that captures the novel realities of today's pervasive digital operations and the organizing logic that governs them. This paper addresses the gap by offering a foundational reframing of firm-level strategy guided by the principles of digital logic – the economic regime of value creation and capture predicated on the primacy of digital objects and their runtime orchestration into digital service stacks. We draw on the core guidance view of strategy and define digital strategy as the smallest set of scope, value proposition, and functional choices that, subordinate to the primacy of digital objects, optimally guides all other firm decisions. Based on the definition, we advance a framework for digital strategy formulation and execution comprising three recursive, interdependent activities: digital visioning, digital service stack architecting, and leverage point recognition and manipulation. These activities guide the coherent configuration and deployment of digital service stacks, including their operational, virtual, and contextual embeddings. We use the illustrative case of a century-old, global heavy equipment manufacturer to demonstrate how the firm reframed its strategy under digital logic. The proposed theory advances scholarship on digital strategy by foregrounding the ontology of digital objects and establishes a metatheoretical foundation for future research on digital strategy.