Digital Transformation Model On Smes Business Performance: An Empirical Study On Smes Receiving Bni Bank Credit  In North Sumatra

Alexander Romario  Bukit; Endang Sulistya Rini; Beby Karina Fawzeea  Semiring

doi:10.37676/sosj.v3i2.1833

Authors

Alexander Romario Bukit Universitas Sumatera Utara
Endang Sulistya Rini Universitas Sumatera Utara
Beby Karina Fawzeea Semiring Universitas Sumatera Utara

DOI:

https://doi.org/10.37676/sosj.v3i2.1833

Keywords:

Digital Strategy, Market Competition, Government Support, Digital Transformation , Business Performance

Abstract

The main objective of this study is to analyze and demonstrate the influence of Digital Strategy, Market Competition, Government Support, and Digital Transformation on the business performance of SMEs in North Sumatra Province. The research employs an explanatory research approach, which aims to explain the position of the variables under study and the relationships between them. Data were collected from SME actors in North Sumatra Province, using a sample of 175 respondents. The data analysis technique applied in this study is Structural Equation Modeling (SEM). The results of the study demonstrate that Digital Strategy, Market Competition, and Government Support have a positive and significant effect on Digital Transformation. Government Support and Digital Transformation have a positive and significant effect on Business Performance. Digital Transformation serves as a significant mediating variable between external factors (Digital Strategy, Market Competition, and Government Support) and SME business performance. The contributons of these findings are crucial for long-term business sustainability, as effective digital strategies and strong external support help SMEs adapt to market, technological, and regulatory changes.

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