Reaching sustainability during a digital transformation: a PLS approach

Abstract

Purpose In a world where big data have become crucial to guarantee the success of companies, digital transformation came to help companies transition towards a digital business and accept the changes in the organizational structure as well as the market. Nonetheless, even with the ever-growing importance shed on it, few articles and studies have linked it to the sustainability paradigm. Empirical studies that have linked between the factors of digital transformation and a more sustainable business are still scant. Many efforts are still needed to reduce the knowledge gap between these two concepts. The purpose of this paper is to fill this gap by examining (empirically) the effect of digital transformation on sustainability. Design/methodology/approach The study validates five different hypotheses highlighted by the literature using structural equation model (SEM) analysis from partial least square (PLS) approach. It uses a new conceptual framework using a survey data, answered by 41 small- and medium-sized enterprises (SMEs) in Morocco from different industries. Findings Using PLS-SEM modeling, the results show that customers, data and innovation, which are drivers that companies should work on during a digital transformation, have a significant impact on companies’ quest to reach sustainability. However, and in contrast to the existing literature, authors find that competition did not play a significant role in enhancing the companies’ commitment to sustainability. Practical implications Authors’ findings encourage firms to seize the opportunity of digital transformation to embrace sustainability, because the implementation of these two concepts requires radical changes at the business model level. Authors suggest that the road to achieve sustainability in a digital era should focus on three main axes, enhancing the customer experience and adopting customer centricity, building data analytics capabilities and shifting innovation to the business model level. Originality/value To the best of the authors’ knowledge, this study is one of the first research papers that explain how to reach sustainability during a digital transformation. The originality of this paper lies in the fact that it focuses on SMEs as they remain the backbone of the Moroccan economy. This study is also novel for showing with empirical evidences that working on the axes of customers, data and innovation, during a digital transformation journey, will improve sustainable practices within businesses.