Digital Transformation and Competency as Drivers of Employee Performance: Evidence from Batik SMEs in Pekalongan, Indonesia

Abstract

This research article examines competency development and digital transformation, human resource creativity, and employee performance in Batik small and medium entrepreneurs (SMEs). Batik SMEs in Pekalongan, Central Java Province, Indonesia were chosen as subjects. Total 1823 Batik SMEs. A sample of 95 Batik SMEs was taken randomly, 95 questionnaires were distributed, and all were collected. This study concludes that: there is an important role for competency development and digital transformation in increasing human resource creativity, and human resource creativity has a positive effect on employee performance; Human resource creativity plays a mediating role in the influence of competency development and digital transformation on employee performance in UKM Batik Pekalongan, Indonesia. The research findings provide Batik SMEs in Pekalongan, Indonesia with a clear understanding of the relationship between employee performance, human resource creativity, and competency development in the context of digital transformation. This understanding enables the development of strategies and plans aimed at enhancing employee performance.