Digital Agility, Digital Competitiveness, and Innovative Performance of SMEs

Abstract

This paper aims to discuss the role of digital agility and digital competitiveness in SMEs' innovative performance in the context of a digitally turbulent environment. While SME innovative performance is a key research topic, we did not find recent research that investigates the relationship between digital agility, digital competitiveness, and innovative performance in the context of SMEs. The research is part of ongoing work in which the IT-related practice of Hungarian organizations has been explored on an annual basis since 2009. We applied a combined research methodology; both qualitative and quantitative methods were used, including surveying digital transformation literature, developing a survey to collect quantitative data, data collection, and processing with PLS-SEM. According to our model, SMEs are worth investing in and developing risk taking and change capabilities from their organizational culture to increase digital innovation capability and digital transformation maturity, which leads to better innovative performance. The uniqueness of our research is that, according to the literature, the innovative performance of SMEs is an under-researched area, if we take into consideration digital agility and digital competitiveness. The COVID-19 pandemic also reinforced the role of these factors in SME survival. Our main contribution is that we provide a conceptual framework for improving SMEs' innovative performance through digital agility and digital competitiveness in digital turbulence.