Fostering competitiveness of Indian MSMEs through IT and digitalization

Abstract

This study investigates how IT and digitalization can boost the growth and competitiveness in Indian Micro, Small, and Medium Enterprises (MSMEs) using the Technology-Organization-Environment (T-O-E) framework combined with performance metrics. It also identifies barriers to successful digital transformation, offering key insights for the sector’s advancement. A mixed-methods approach was used, collecting qualitative data from 14 respondents and quantitative data from 321 MSMEs. The stage model used in the study reveals that MSMEs have not yet fully embraced digital maturity, and their transformation remains in its early stages due to critical barriers – ranging from inadequate internet infrastructure to a shortage of skilled talent and technological awareness. The survey highlights that digital adoption in MSMEs is influenced not only by technological factors but also by organizational and environmental factors. These factors significantly impact digital adoption, leading to substantial improvements in both financial and non-financial performance metrics for Indian MSMEs.

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