A review of the digitalization of the small and medium enterprises (SMEs) toward sustainability

Abstract

Small- and medium-sized enterprises (SMEs) are of paramount importance in the global economy.  The advent of the COVID-19 pandemic has significantly impacted numerous economies, resulting in substantial transformations across various aspects and elements of SMEs. The acceleration of digital transformation has been observed as a notable response to the ongoing pandemic. The utilization of digital transformation as a means of fostering innovation has the potential to facilitate sustainability, enhance competitiveness, and enable customization in both products and services. Nevertheless, there is a lack of comprehensive understanding regarding the extent to which SMEs have embraced digital technology in order to support and promote sustainability objectives. Hence, the primary objective of this study is to present an in-depth review of the digitization of SMEs in relation to sustainability, employing the systematic literature review approach. The analysis conducted encompassed three primary domains: the technological facets of digitalization, sustainability in accordance with the triple bottom line (comprising economic, environmental, and social factors), and the business attributes specific to SMEs. This review analysis elucidated the specific technological advancements that facilitate SMEs in their pursuit of sustainable development. In addition, this study synthesizes material that discusses the sustainability aspects of the triple bottom line and the specific areas of Industry 4.0 technology that have been utilized. Furthermore, the literature identifies other aspects including corporate strategy and management, organizational structure, organizational culture, skills and qualifications, and leadership considerations. Additionally, it synthesized potential avenues for future research that have emerged from the study. This study makes a significant contribution to the achievement of sustainable development goals (SDGs) and offers vital insights for policymakers and SMEs seeking to transition their production practices towards sustainability and digitalization.