Do Dynamic Capabilities and Digital Transformation Improve Business Resilience during the COVID-19 Pandemic? Insights from Beekeeping MSMEs in Indonesia

Abstract

This study investigated the influence of Dynamic Capabilities (DC) and Digital Transformation (DT) on Business Resilience During the COVID-19 Pandemic. Using cross-sectional data from 388 micro, small, and medium enterprises (MSMEs) of beekeeping in Indonesia. Furthermore, the data were analyzed by Structural Equation Model (SEM) analysis and executed by SmartPLS 3.0 software. The main results of this study indicate that DC plays an important role in improving MSMEs’ DT. However, the essential role of DT on firm resilience only happened for micro, small, and medium firms of family businesses. However, DT has an insignificant effect on firm resilience in small nonfamily businesses. Yet, the effect of DC on firm resilience is mediated by DT. Nevertheless, our empirical findings indicate heterogeneous effects among micro, small, and medium firms. Based on the study’s findings, we suggested that the policy implication in developing beekeeping firms should be more specific based on the firm scale. The results of this study can be generalized to the national level to inform decision-making regarding the intangible assets of MSME livestock products in developing countries. The findings are also relevant to other livestock products, which tend to be dynamic during a crisis.

Psychological resilience of dairy farmers, life satisfaction, and the moderating role of age; Is there a link?

“…This study is limited to the research of dairy cattle farming in the business development centers located in East Java. Furthermore, this research has not yet proven the measurement of each business based on the scale of operations, as demonstrated by previous research (reference 11), which indicates that the size of businesses in terms of assets can show differences in the resilience of entrepreneurs when facing threats.…”

“…[1][2][3][4][5][6][7][8][9][10] . It can lead to entrepreneurs being unable to maintain their competitive advantages 11 , as several international studies have shown that when they cannot sustain, there is a decline in profit and business performance. For example, according to the empirical outcomes revealed by 12 conducted in the agricultural sector in the Netherlands, there is a connection between psychological issues and financial problems for entrepreneurs.…”

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“…The development of DC helps companies adapt to the waves of technological innovation through environmental scanning, sensing, and integrative stages (Putritamara et al, 2023). By developing sensing and seizing capabilities firms could take advantage of opportunities, and ultimately reconfigure and adapt the business to the future advances of upcoming digital technologies quickly.…”

“…Moreover, they found that the size effect of market agility is larger than the operational agility. In a recent study, Putritamara et al (2023) by using cross-sectional data from beekeeping companies in Indonesia, found that dynamic capabilities play an important role in improving the DT of SMEs.…”