The nexus between digital innovation technology and competitive advantage: Mediated by management business strategy

Abstract

This research was carried out specifically by exploring the interaction between management business strategy with a competitive advantage and digital innovation technology on micro, small and medium enterprises (MSMEs) in Central Java. The population of this research is SMEs in construction and real estate services in Central Java. The analytical method uses the partial least square (PLS) method through a variance-based structural equation model (SEM) statistical test tool. Data analysis was carried out using SmartPLS and applying verification analysis (measurement of the outer model, evaluation of the structural model (inner model), and testing of research hypotheses). The data analysis that has been carried out has found that digital innovation technology has a positive and significant impact on the competitive advantage of MSMEs in construction and real estate services in Central Java. Meanwhile, testing through a management business strategy as a mediation between digital innovation technology and the competitive advantage of MSMEs in construction and real estate services in Central Java shows a unidirectional relationship. These results show that MSME actors have used digital innovation technology to support the company’s competitive advantage (Khalil et al., 2022)