Accelerating Digital Transformation during the COVID-19 Pandemic: A Model Design for Indonesian MSMEs

Authors

  • Mercurius Broto Legowo Perbanas Institute
  • Fangky Antoneus Sorongan Perbanas Institute

DOI:

https://doi.org/10.21512/bbr.v13i2.8447

Keywords:

digital transformation, model design, Indonesian MSMEs, COVID-19 pandemic

Abstract

The acceleration of digital transformation and business model innovations fundamentally improves business growth and performance. However, the occurrence of the COVID-19 pandemic has a significant influence on the insecurity of many business actors, especially Micro Small Medium Enterprises (MSMEs). There are many efforts to recover the national economy by accelerating digital transformation for MSMEs programs by the government of the Republic of Indonesia. However, the problem arises when the process of accelerating digital transformation in Indonesian MSMEs is considered slow to encourage Indonesia’s National Economic Recovery (PEN as shortened in Indonesian) during the COVID-19 pandemic. The research aimed to present a design model for accelerating digital transformation during the COVID-19 pandemic for Indonesian MSMEs. The research applied a descriptive-analytic approach with a qualitative method. Then, the analysis reviewed the content analysis of previous research. The two research models were analyzed. One was from Indonesia, while another one was from outside Indonesia. The results of the model design reveal that the acceleration of digital transformation is influenced by business driving factors and impacts the gaining value from business model innovations. The model of accelerating digital transformation for MSMEs is expected to contribute significantly to supporting government programs and strengthening National Economic Recovery policies during the COVID-19 pandemic.

Dimensions

Plum Analytics

Author Biographies

Mercurius Broto Legowo, Perbanas Institute

Information System Study Program, Faculty of Information Technology

Fangky Antoneus Sorongan, Perbanas Institute

Accounting Study Program, Faculty of Economic and Business

References

Abidin, M. Z. (2021). Pemulihan ekonomi nasional pada masa pandemi Covid-19: Analisis produktivitas tenaga kerja sektor pertanian. Indonesian Treasury Review: Jurnal Perbendaharaan, Keuangan Negara dan Kebijakan Publik, 6(2), 117–138.

Bouwman, H., Nikou, S., Molina-Castillo, F. J., & De Reuver, M. (2018). The impact of digitalization on business models. Digital Policy, Regulation and Governance, 20(2), 105–124.

Cao, G., Duan, Y., & El Banna, A. (2019). A dynamic capability view of marketing analytics: Evidence from UK firms. Industrial Marketing Management, 76(January), 72–83.

Chakraborty, I., & Maity, P. (2020). COVID-19 outbreak: Migration, effects on society, global environment and prevention. Science of the Total Environment, 728, 1–7.

CNN Indonesia. (2021). Pemerintah targetkan 30 juta UMKM go digital pada 2023. Retrieved from https://www.cnnindonesia.com/ekonomi/20210111110041-92-592065/pemerintah-targetkan-30-juta-umkm-go-digital-pada-2023

Creswell, J. W. (2017). Research design: Qualitative, quantitative, and mixed methods approaches. London: SAGE Publications.

De Mendonca, C. M. C., & De Andrade, A. M. V. (2018). Microfoundations of dynamic capabilities and their relations with elements of digital transformation in Portugal. In 2018 13th Iberian Conference on Information Systems and Technologies (CISTI) (pp. 1–6). IEEE.

Holtström, J. (2022). Business model innovation under strategic transformation. Technology Analysis and Strategic Management, 34(5), 550–562.

Ibarra, D., Bigdeli, A. Z., Igartua, J. I., & Ganzarain, J. (2020). Business model innovation in established SMEs: A configurational approach. Journal of Open Innovation: Technology, Market, and Complexity, 6(3), 1–22.

Jauhari, H., & Periansya, P. (2021). Economic growth, poverty, urbanization, and the Small and Medium Enterprises (SMEs) in Indonesia: Analysis of Cointegration and Causality. Binus Business Review, 12(2), 143–150.

Kaur, H., & Bath, A. K. (2019). Digital transformation strategies in different areas: A review. International Journal of Scientific & Technology Research, 8(12), 348–351.

Kementerian Keuangan Republik Indonesia. (2021). Ekonomi digital Indonesia diprediksi tumbuh hingga delapan kali lipat di tahun 2030. Retrieved from https://www.kemenkeu.go.id/publikasi/berita/ekonomi-digital-indonesia-diprediksi-tumbuh-delapan-kali-lipat-di-tahun-2030/

Kotsenas, A. L., Arce, M., Aase, L., Timimi, F. K., Young, C., & Wald, J. T. (2018). The strategic imperative for the use of social media in health care. Journal of the American College of Radiology, 15(1), 155–161.

Kudyba, S. (2020). COVID-19 and the acceleration of digital transformation and the future of work. Information Systems Management, 37(4), 284–287.

Legowo, M. B., Indiarto, B., & Prayitno, D. (2021a). Digitalization for business model innovation: Create, change, and improve for values. In 2021 4th International Conference of Computer and Informatics Engineering (IC2IE) (pp. 192–197). IEEE.

Legowo, M. B., Indiarto, B., & Prayitno, D. (2021b). The resilience of MSMs in Indonesia during the Covid-19 Pandemic through the digitalization program. In World Conference on Pandemic Studies-II, (pp. 131–139).

Legowo, M. B., Prayitno, D., & Indiarto, B. (2021). Digital economy inclusiveness information system model to encourage national economic recovery: Recover together, recover stronger. In Conference Towards ASEAN Chairmanship 2023 (TAC 23 2021) (pp. 61–67). Atlantis Press.

Legowo, M. B., Sorongan, F. A., & Subanidja, S. (2021). Digital economic model to encourage national economic recovery during Covid-19 pandemic. In Conference Towards ASEAN Chairmanship 2023 (TAC 23 2021) (pp. 55–60). Atlantis Press.

Legowo, M. B., Subanidja, S., & Sorongan, F. A. (2020). Model of sustainable development based on FinTech in financial and banking industry: A mixed-method research. In 2020 3rd International Conference on Computer and Informatics Engineering (IC2IE) (pp. 194–199). IEEE.

Liliani, L., & Wiliana, J. (2018). Kapabilitas dinamis UMKM dalam merespons perubahan lingkungan bisnis. Business and Finance Journal, 3(1), 33–46.

Osmundsen, K., Iden, J., & Bygstad, B. (2018). Digital transformation: Drivers, success factors, and implications. In The 12th Mediterranean Conference on Information Systems (MCIS) (pp. 1–15).

Otoritas Jasa Keuangan. (2020). Survei nasional literasi dan inklusi keuangan 2019. Retrieved from https://www.ojk.go.id/id/berita-dan-kegiatan/publikasi/Pages/Survei-Nasional-Literasi-dan-Inklusi-Keuangan-2019.aspx

Pucihar, A., Lenart, G., Borštnar, M. K., Vidmar, D., & Marolt, M. (2019). Drivers and outcomes of business model innovation–Micro, small and medium-sized enterprises perspective. Sustainability, 11(2), 1–17.

Qarnain, S. S., Muthuvel, S., & Bathrinath, S. (2021). Review on government action plans to reduce energy consumption in buildings amid COVID-19 pandemic outbreak. Materials Today: Proceedings, 45, 1264–1268.

Rachinger, M., Rauter, R., Müller, C., Vorraber, W., & Schirgi, E. (2019). Digitalization and its influence on business model innovation. Journal of Manufacturing Technology Management, 30(8), 1143–1160.

Rêgo, B. S., Jayantilal, S., Ferreira, J. J., & Carayannis, E. G. (2021). Digital transformation and strategic management: A systematic review of the literature. Journal of the Knowledge Economy, 1–28.

Rupeika-Apoga, R., Bule, L., & Petrovska, K. (2022). Digital transformation of small and medium enterprises: Aspects of public support. Journal of Risk and Financial Management, 15(2), 1–21.

Sjödin, D., Parida, V., Jovanovic, M., & Visnjic, I. (2020). Value creation and value capture alignment in business model innovation: A process view on outcome-based business models. Journal of Product Innovation Management, 37(2), 158–183.

Teece, D. J. (2018). Business models, business strategy and innovation. Long Range Planning, 43(2-3), 172–194.

Verhoef, P. C., Broekhuizen, T., Bart, Y., Bhattacharya, A., Dong, J. Q., Fabian, N., & Haenlein, M. (2021). Digital transformation: A multidisciplinary reflection and research agenda. Journal of Business Research, 122(January), 889–901.

Vu, H. M. (2020). A review of dynamic capabilities, innovation capabilities, entrepreneurial capabilities and their consequences. The Journal of Asian Finance, Economics and Business, 7(8), 485–494.

Widnyani, N. M., Astitiani, N. L. P. S., & Putri, B. C. L. (2021). Penerapan transformasi digital pada UKM selama pandemi Covid-19 di Kota Denpasar. Jurnal Ilmiah Manajemen dan Bisnis, 6(1), 79–87.

Yin, R. K. (2014). Case study research: Design and methods. SAGE Publications.

Downloads

Published

2022-07-26
Abstract 803  .
PDF downloaded 531  .