Does Digital Transformation Impact Upper-Middle-Class Hospital Performance Through Business Model Innovation? (Preprint)

Abstract

BACKGROUND This research examines the influence of Digital Transformation (DT) and Resources Integration (RI) on Hospital Performance (HP), with Business Model Innovation (BMI) as a mediating variable. The focus is on upper-middle-class hospitals in Indonesia. OBJECTIVE The objective of the study is to analyze how DT and RI impact HP and to explore the mediating role of BMI in this relationship METHODS The study employs quantitative methods, collecting data through a 5-point Likert scale questionnaire distributed via Google Forms. Valid responses were gathered from 241 hospitals. The data were analyzed using SmartPLS RESULTS The findings reveal that DT does not have a significant direct influence on HP, whereas RI has a significant positive impact on HP. Both DT and RI significantly influence BMI, which in turn significantly affects HP, highlighting its strong mediating role. These results underscore the importance of BMI as a crucial link between DT, RI, and improved hospital performance. CONCLUSIONS The study concludes that focusing on innovative business models enables hospitals to better leverage digital technologies and integrated resources to enhance their performance. Practically, this research suggests that hospital managers in Indonesia should prioritize developing innovative business models, invest in training and skill development programs, and implement appropriate innovation strategies to improve performance, patient outcomes, and operational efficiency. This study contributes to the literature on hospital management and Digital Transformation, particularly in the Indonesian context, and provides actionable recommendations for leveraging digital advancements and resource integration for superior healthcare delivery.