Proceedings of the BISTIC Business Innovation Sustainability and Technology International Conference (BISTIC 2024)

The Digital Transformation: Exploring Innovation’s Impact on SME Competency and Sustainability in the Digital Age

Authors
Faisol Faisol1, *, Sigit Puji Winarko1, Sri Aliami1
1University of Nusantara PGRI Kediri, Jl. KH. Ahmad Dahlan No. 76, Mojoroto, Kediri City, East Java, Indonesia
*Corresponding author. Email: faisol@unpkdr.ac.id
Corresponding Author
Faisol Faisol
Available Online 19 November 2024.
DOI
10.2991/978-94-6463-576-8_15How to use a DOI?
Keywords
Business competency; Innovation; Micro small medium enterprises; Relational competency
Abstract

This research investigates the role of innovation in diving the business competency and relational competency on the sustainability of SMEs in the digital era. We use data from shared questionnaires distributed to 152 owners of small and medium businesses in clusters located in East Java Indonesia. To estimate the hypothesized relationships, this reset used PLS-SEM. The result showed the business competency has no direct effect on firm sustainability, it does have a significant impact on firm sustainability through innovation. These results suggest that when developing appropriate policies for SMEs, the role of innovation is as a potential intermediary in boosting business capabilities toward the sustainability of SMEs, and it must be considered rightly to address the challenges associated with enterprise internationalization. In short, the development of innovation for the right business competency is critical for SMEs to compete on a global scale. In this study, we recommend that SMEs prioritize innovation as a key intermediary in enhancing business competency for long-term sustainability. Policies should support innovation-driven business models, sector-specific innovation needs, and provide financial incentives for R&D and technology adoption. Collaboration with innovation hubs and promoting digital literacy are crucial for fostering a culture of innovation. Networking opportunities should also be encouraged to strengthen relational competency, enabling SMEs to compete globally.

Copyright
© 2024 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the BISTIC Business Innovation Sustainability and Technology International Conference (BISTIC 2024)
Series
Advances in Economics, Business and Management Research
Publication Date
19 November 2024
ISBN
978-94-6463-576-8
ISSN
2352-5428
DOI
10.2991/978-94-6463-576-8_15How to use a DOI?
Copyright
© 2024 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

TY  - CONF
AU  - Faisol Faisol
AU  - Sigit Puji Winarko
AU  - Sri Aliami
PY  - 2024
DA  - 2024/11/19
TI  - The Digital Transformation: Exploring Innovation’s Impact on SME Competency and Sustainability in the Digital Age
BT  - Proceedings of the BISTIC Business Innovation Sustainability and Technology International Conference (BISTIC 2024)
PB  - Atlantis Press
SP  - 167
EP  - 174
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-576-8_15
DO  - 10.2991/978-94-6463-576-8_15
ID  - Faisol2024
ER  -