SME and digital transformation: a dream too far?

Digital transformation is a critical process given its correlation with innovation, new competitive advantages and ultimately with a superior business performance. However, digital transformation in SMEs is less investigated and only a small number of rather personal factors – such as owner-manager's gender, age and educational background – were identified to influence the digitalization process. This study investigates the extent to which SMEs have adopted new digital technologies and what other organizational factors are correlated with a higher level of digitalization. Data were collected from 249 organizations through a CATI survey at the beginning of COVID pandemic and were analysed using bivariate statistical methods. The results indicate that less than 2% of SMEs have a strong degree of digitalization, while almost 80% of them have a weak level. Additionally, we identified three factors which influence the degree of digitalization, namely: industry, company’s age and type of product sold. Thus, professional services industry has a high degree of digitalization, while retail has the lowest one. Older companies and those which provide mostly services have recorded a higher level, while startups and enterprises which offer physical goods are the least digitized. Surprisingly, there is no correlation between the size of the firm or its organizational structure (traditional, fluid or mixed) and the degree of adoption of digital technologies. Although the digitalization is relatively weak, the pandemic was an accelerator of digital transformation that has forced companies to test and implement new business models.