Journal
JOURNAL OF THEORETICAL AND APPLIED ELECTRONIC COMMERCE RESEARCH
Volume 17, Issue 2, Pages 669-685Publisher
MDPI
DOI: 10.3390/jtaer17020035
Keywords
digital transformation; SME; digital orientation; digital capability; mediation analysis; resource orchestration theory; dynamic managerial capabilities theory
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Funding
- Latvian Council of Science [LZP-2020/2-0061]
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This study explores the impact of digital orientation and digital capability on digital transformation in SMEs, as well as the mediating effect of digital transformation on revenue and business models. The findings indicate that both digital orientation and digital capability have a direct positive effect on digital transformation, and digital transformation plays a mediating role in SME outcomes.
Despite the growing importance of digital transformation, empirical research on the drivers of digital transformation is still lacking, creating a knowledge gap. The purpose of this study is to explore the effect of digital orientation and digital capability on digital transformation, as well as the mediating effect of digital transformation on revenues and business models of SMEs during the COVID-19 pandemic. This paper examines a new conceptual framework designed on resource-based theory perspectives by using survey data of 246 SMEs in Latvia. To achieve the research purpose, this study used a mediation analysis to examine the direct effect of digital orientation and digital capability on digital transformation, as well as to explore the mediating effect of digital transformation on SME outcomes. Our results reveal that both digital orientation and digital capability have direct positive effects on digital transformation. We also found that digital transformation has a positive mediating effect from digital orientation on revenue and business model, as well as from digital capability on revenue. These findings could be useful for policymakers, managers and practitioners to clarify how digital orientation and digital capability intermediated through digital transformation affect the outcomes of SMEs.
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