Digital transformation in an emerging economy: exploring organizational drivers

Abstract

While there is sufficient evidence from empirical studies that digital technologies are strategic resources for value creation, existing literature on the theme lacks general concepts that explore an organization’s strategic resources concerning digital orientations and transformation initiatives. This study hence builds on a resource-based view with digital orientation literature to conceptualize a novel strategic orientation concept to understand the attitude toward digital innovation integration among firms in an emerging and developing country. This study tests a new conceptual framework using survey data from 472 employees of small-to-medium-sized service-based firms and employing structural equation model analysis with a variance-based SEM approach. Our empirical results showed that IT infrastructural availability and digital innovation investment are significant organizational drivers that have a direct relationship with attitude toward digital innovation integration among firms whereas IT competencies, digital innovation management, and knowledge of digital innovation are not significant with attitude toward digital innovation integration. More importantly, our findings advance the literature on a firm’s strategic resources and bring the realms of strategy and digital orientation closer together. The study provides valuable insights for management and shareholders regarding the specific drivers that affect the adoption of digital technologies among service-based SMEs in emerging economies.