Digital transformation as the driving force for sustainable business performance: A moderated mediation model of market-driven business model innovation and digital leadership capabilities

Abstract

Global organizations are still facing challenges in achieving sustainable performance despite the surge in digital technologies. It is imperative that firms invest in digital capabilities to secure sustainable market performance in the face of a barrage of novel inventions. Today, ensuring a resilient future demands business to focus on digital ambidexterity capabilities (i.e., exploitation and exploration), digitalized strategy adoption, and digital transformation. This study investigates the intricate dynamics between digital capabilities and digitalization strategies and their impact on sustainable business performance. The research employed a questionnaire-driven methodology to gather data from managerial personnel within industries. Results show that digital exploitation and exploration capabilities significantly enhance sustainable business performance. The research also establishes the beneficial effect of adopting a digitalization strategy on business performance and innovation. Market-driven business model innovation emerges as a critical factor, not only driving sustainable performance but also serving as a mediating link between various digital strategies and business success. Moreover, the study highlights the importance of digital leadership capabilities, further strengthening the relationship between innovative business models and sustainable performance. The findings underscore the synergistic effect of digital competencies and strategic digitalization in promoting sustainable and innovative practices in today's digital-driven business landscape.