EXPLORING THE IMPACT OF DIGITAL TRANSFORMATION ON SMALL AND MEDIUM-SIZED ENTERPRISES (SMES) IN SELECTED FIRMS IN ANAMBRA STATE

Abstract

This study examines the impact of digital transformation on Small and Medium-sized Enterprises (SMEs) in developing economies, focusing on the challenges, opportunities, and policy implications for SME growth and development. A mixed-methods approach is employed, combining surveys of 300 SMEs with in-depth interviews of 10 business owners from selected SME organisations in Anambra State.  The findings reveal significant relationships between digital transformation, innovation, and SMEs’ competitiveness, as well as improvements in customer engagement and increased access to new markets.  However,  infrastructure constraints, skills gaps, and regulatory barriers hinder digital adoption. This study identifies key drivers of digital transformation for SMEs, including cloud computing, big data analytics, and social media. It also emphasizes the significance of government support, infrastructure development, workforce development, and training in facilitating digital transformation. Policy recommendations are provided to address the challenges and leverage digital transformation for inclusive economic growth.  These include investing in digital infrastructure, promoting digital literacy, and implementing policies that foster innovation and entrepreneurship.  This  research  contributes  to the understanding  of  digital  transformation’s impact on SMEs in developing economies, informing policymakers, practitioners, and  scholars