Does Digital Leadership Impact the Performance of Lower-Middle-Class Hospitals?

Abstract

Even though Indonesia has a large number of hospitals and has experienced significant progress in realizing Universal Health Coverage (UHC), service performance is still relatively low, so many patients seek treatment abroad. The performance of services and care systems in hospitals is often associated with low use of digital technology. The complexity of adopting digital technology in a hospital environment is not an easy thing to do, with the majority of users carrying out digital technology functions being health officers and professionals. This research aims to explore the influence of Digital Leadership in encouraging the adoption of digital technology and its influence on Hospital Performance. Survey data conducted on 285 leaders of Class C and D hospitals spread throughout Indonesia, through Structural Equation Modeling (SEM) analysis using Lisrel 8.80, it was found that there was a positive and significant influence on the role of Digital Adoption Capability as a mediation on Hospital Performance. It was found that Digital Leadership has a positive and significant influence on hospital performance both directly and through the mediation of Digital Adoption Capability. Environmental Dynamism factors have also been proven to significantly influence hospital management’s desire to improve performance through the adoption of digital technology. The model resulting from this research provides a comprehensive view of hospital management in developing effective digital technology adoption strategies in facing an ever-changing environment.