I have to apply this strategy! Understanding the mediating effect of digitalization on strategic orientations and sustainable competitive advantage among small enterprises in Tanzania

Abstract

Purpose–The combination of strategic orientation and digitalization for sustainable competitive advantageamong small businesses is still not given much attention in the literature. Therefore, this study aims tounderstand the influence of strategic orientation on sustainable competitive advantage while mediating therelationship with digitalization.Design/methodology/approach–This study used a cross-sectional design. This design helped collect datafrom 234 small businesses in Arusha city, Tanzania. Since the study used latent variables, structural equationmodeling (SEM) was used to analyze relationships and conduct confirmatory factor analysis. Throughbootstrapping confidence intervals, Hayes’s Process was also used to test how digitalization mediates therelationship between strategic orientations and sustainable competitive advantage.Findings–The strategic orientation attributes that include market orientation, entrepreneurial orientationand learning orientation were positively and significantly related to digitalization. Furthermore, the results ondigitalization and sustainable competitive advantage show a significant positive relationship. Finally,digitalization was analyzed to mediate the relationship between strategic orientation, market orientation,entrepreneurial orientation, learning orientation and sustainable competitive advantage. Hence, all hypotheseswere supported.Research limitations/implications–This study adopted a cross-sectional design that helped to capturethe quantitative information. In addition, the current study is limited to Tanzania’s small businesses; thus, thefindings cannot assure generalization of the conclusion to other countries because of the differences in social,cultural and technology across countries.Originality/value–This study integrates the concepts of strategic orientation from the strategicmanagement discipline and digitalization from a technology perspective. As a result, the study adds newknowledge about combining two aspects and determining whether they add value in terms of providing asustainable competitive advantage. This knowledge comes from digitalization, which acts as a mediatorbetween strategic orientation dimensions and a sustainable competitive advantage.KeywordsStrategic orientation, Market orientation, Entrepreneurial orientation, Learning orientation,Digitalization, Sustainable competitive advantage, Tanzania