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Digital transformation, organisational capabilities, and SME performance - size matters

Year: 2025

Type: article

Abstract: This paper aims to reveal organisational capabilities of small and medium- sized enterprises (SMEs) to transform digitally and to explore some differences between enterprises’ groups. The study approaches digital transformation as transformative and continuous organisational change facilitated by digital technologies and describes the capabilities of SMEs to navigate such a change. This research is quantitative and uses data from a sample of 308 SMEs in Bulgaria, collected during October-December 2023. Five composite variables (transformational leadership, organisational flexibility, risk- tolerant culture, digital skills, and digital business intensity) are used to describe SMEs' ability to implement DT-induced organisational change. Based on these variables, a cluster analysis is applied, which delineates four distinct groups of SMEs. The results show that medium-sized firms do much better on all five variables and demonstrate better firm performance than micro-enterprises.

Source: Eastern Journal of European Studies

DOI: 10.47743/ejes-2025-0110

Authors: Irena Mladenova, Zhelyu Vladimirov, Olya Harizanova

Institution: Sofia University "St. Kliment Ohridski"

Language: English

Topic: Digital Innovation in Industries

Subfield: Management of Technology and Innovation

Field: Business, Management and Accounting

Domain: Social Sciences

SDGs: Decent work and economic growth, Industry, innovation and infrastructure

Open Access status: diamond

Funders: European Commission, NextGenerationEU