The Effect of Digital Talent and Digital Capability on Bank Performance: Perspective of Regional Development Bank Employees

Abstract

The digital talent gap has expanded globally, and the industry sector most pronounced is the banking industry, the most critical sector in the Indonesian economic system. Previous studies have shown that institutions must understand and own digital capabilities to achieve better performance. The aim of this research is to examine the effect of digital talent and digital capability through the lens of dynamic capability on bank performance. This research uses a quantitative method, with 344 North Sulawesi & Gorontalo Regional Development Bank employees as respondents spread across various jobs and locations. The data is processed with SmartPLS 4.0.8.4 software. The results show a positive and significant influence of digital talent and digital capability on bank performance. Meanwhile, digital capability has a more substantial role than digital talent in improving bank performance. This research provides new theoretical contributions to studying digital talent and digital capability. This research can also contribute to Indonesia Regional Development Bank's efforts in accelerating its digital transformation and increasing digital talent and digital capability’s competitiveness in improving bank performance. This study introduces the research of digital talent and digital capability in banking to improve regional development banks' competitiveness in facing the competition of the Indonesian banking industry.