Abstract
The purpose of this study is to identify the necessary public support measures for small and medium-sized enterprises (SMEs) and provide policy makers with guidance on how to facilitate a successful digital transformation. The study is based on a representative survey of 425 Latvian SMEs carried out in spring 2021. We combine three analyses: a survey among SMEs, qualitative comparative analysis and regression analysis. The results of this study show that a significant number of SMEs are convinced that they will not be able to cope with digital transformation without various kinds of assistance, with direct financial support from the state or EU funds and tax incentives playing a major role. The range of public support required is rather wide, from staff training, mentoring and increasing the potential workforce to tax relief and direct financial support. We found statistically significant differences in public support needed depending on the size of SMEs and their ability to independently manage digital transformation. These findings could be useful for policymakers, managers and practitioners to identify various forms of public support that can maximize the impact of digital transformation not only on business, but also on society as a whole.
Highlights
The world has been increasingly moving into the digital space, partly due to the emergence of a younger, more technologically perceptive generation
We have identified the main measures of public support as derivatives of the obstacles to the digital transformation of small and medium-sized enterprises (SMEs)
We tested the difference in public support, which depends on the ability of SMEs to independently manage digital transformation and another group of SMEs that cannot cope with it on their own
Summary
The world has been increasingly moving into the digital space, partly due to the emergence of a younger, more technologically perceptive generation. Many business owners and managers do not understand the meaning of digital transformation (Chonsawat and Sopadang 2020). In this age of digital transformation, the concept has become so abstract, so broad, that it can seem confusing. The journey of digital transformation begins with the creation of a digital version of an analogue or physical item. This shift leads to a shift in business operations, models, and competencies to adapt to available technologies, and it never ends. Continuous innovation, the ability to respond quickly to change, as well as the ability to take advantage of challenges and opportunities are required to ensure success
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