Linkage of Digitalization and Perceived Organizational Performance of Small and Medium Enterprises

Abstract

The purpose of this empirical research is to assess the impact of digitalization on perceived organisational performance in all areas of Small and Medium Enterprises (SMEs) in India’s rubber products manufacturing industry. The study employs a quantitative research method with an explanatory research design. The study’s primary data is gathered through surveys of top-level officials and IT managers from SMEs in the rubber products manufacturing industry. The normality and reliability of the data are assessed first using SPSS 22, followed by assessments of internal consistency, divergent validity, convergent validity, and discriminant validity using maximum likelihood estimation of the CFA. The structural equation modelling approach was chosen as the statistical instrument that enables researchers to look at complex interactions between several variables in parallel based on the nature of the research questions, the data that are available, and the theoretical underpinnings of the study. It is identified through this study that major digital technology measures such as Usefulness of Web Portals (UWP), Customer Interface through Web Portals (CIWP), and Major Functionalities of Web Portal (MFWP), Use of Online Activities in Marketing Efforts (OAME), Online Advertisements and Promotion (OAP), Availability of Trained and Skilled Employees (ATSE), and Technological Resources (TR) have a statistically significant impact on the performance of SMEs. The study results provide policymakers with insights into how to provide special incentives and exemplary services to SMEs in order to promote the digitalization in the rubber products manufacturing industry. This study expands the scope of the investigation of the adoption and diffusion of digital technology by measuring the impact of a broad range of digital technologies on SMEs.