Challenges in Digital Transformation of Microenterprises in Nueva Ecija: A Basis for Risk Management Plan

Abstract

Digital transformation (DT) has attracted the attention of management and organizational scholars in the past decade. It has become an important factor for the competitiveness of businesses especially with the microenterprises. The use of technology has been the goal of many microenterprises to push forward in the competition and provide better quality products and services to its customers and improve the customer experience through IT innovation. This paper presents the challenges encountered by the microenterprises in Nueva Ecija both on the business and its employees in relation to digital transformation. A structured questionnaire was given to the 359 respondents representing microenterprises in Nueva Ecija, which showed that majority of the respondents were females at an average age of 43 years old. The objective of the study is to determine the challenges in digital transformation of microenterprises in Nueva Ecija. The sample size of 359 respondents answered questionnaires based on the factors like the level of digital skills, degree of digital transformation acceptance, level of technological adoption, implementation of digital transformation, and the challenges encountered in the process of digital transformation. The level of digital skills especially in the management level and employees appears to be high. On the degree of digital transformation acceptance, the microenterprises showed positive or good acceptance on the digital transformation. In the level of technological adoption, the result showed that majority of the microenterprises are moderately applying digital transformation or willing to apply technology in their business. While in the factor of implementing digital transformation in the business, a very small number of microenterprises implement digital technologies in their operation. Most of the microenterprises experienced difficulties in the digital transformation due factors like financial constraints, resistance to change, skills gap and others. The study recommends that microenterprises in Nueva Ecija should conduct regular training to its management and staff for skills development and acquire the necessary technologies as part of its risk management plan. It is also recommended that owners secure funds to digitally transform its businesses to stay competitive. This paper may be of help to the microenterprises owners and future researchers on the topic of digital transformation of microenterprises.