Abstract:

This study examines how small and medium-sized enterprises (SMEs) generate value and innovation through digital transformation, with a focus on the interaction between strategic orientation and digital capability development. Drawing on qualitative data from in-depth interviews with SME leaders and experts across multiple sectors, the study identifies key patterns in how SMEs utilize digital tools and platforms to enhance competitiveness, foster co-creation with customers and partners, and navigate resource constraints. The findings reveal a dynamic interplay between strategic intent, technological and relational capabilities, and innovation processes. Building on these insights, the authors propose the Digital Synergy Loop, a conceptual framework that captures the iterative alignment of strategy and capability as the foundation for value creation and digital innovation. The framework illustrates how SMEs leverage digital synergies to create adaptive, value-driven pathways. It shows that digital change is a repetitive process of improvement rather than a single project. This research help SME owners build growth by focusing on small steps and collaboration in environments where resources are limited and markets change quickly.

Please choose your submission type: Full Paper

Primary Track: Strategy

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Ms. Chaojie Ma