Digital Technology Adoption Among Philippine Micro-, Small-,and Medium-Sized Enterprises: Barriers, Enablers & Challenges During COVID-19

Abstract

The COVID-19 pandemic has forced Philippine micro-, small-, and medium-scale enterprises (MSMEs) to undergo some form of digitalization to survive and continue servicing clients' needs. Many MSMEs failed to cope with the business-related impacts of the pandemic — 70.6% of which decided to shut down temporarily (Shinozaki, 2020). Others were able to transition with the help of digital technologies, allowing them to withstand the pandemic's impacts. These businesses started adopting social media and e-commerce platforms and meeting with clients via virtual setups, to name a few. For this research, we identified the enablers, barriers, and challenges faced by select Philippine MSMEs as they attempted to enhance their digital capabilities. Using the multiple case study research design, we examined the narratives derived from our in-depth interviews with 9 Philippine-based MSMEs. Our findings show that Philippine MSMEs experienced diverse enablers, barriers, and challenges during COVID-19 and exhibited increased openness to digital technologies. Finally, we present that MSMEs that can effectively address their barriers and challenges are likely to come out stronger in the post- pandemic era. Given this, post-pandemic resilience is necessary for MSMEs to sustain business operations, withstand future shocks, and capitalize on new business opportunities.