Factors influencing small and medium size enterprises development and digital maturity in Latin America

Abstract

The Covid-19 pandemic has made digital transformation no longer an option but a necessity for small and medium-sized enterprises (SMEs) to succeed in a highly globalized market. The purpose of the study was to analyze the impact of digital maturity factors on the level of development of SMEs in Latin America. The data for this study was collected using an online survey from the representatives from 490 SMEs from Argentina, Costa Rica, Ecuador, Mexico and Uruguay, using structural equation modeling and hierarchical regression for the analysis. There were several results found in the study. First, the results suggested that commitment to digital maturity (CDM) does not influence participants' training and digital skills (TDS) and development level (DL) directly but does have a positive indirect influence on the development level of participants if they are provided training in digital skills. Second, digital maturity experience (DME) directly influenced TDS and positively impacted DL directly and indirectly. Third, training in digital skills does influence the development level of participants. However, CDM alone was not enough to affect the DL of SMEs and was only significant when TDS acted as a mediating variable. Few studies have been conducted to address this critical issue in Latin America, especially to determine which variables impact the development of SMEs the most. Hence, this study provides a novel contribution to the literature. The results of this study are expected to support SMEs in increasing their competitiveness in this era of accelerated digital transformation.