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