Determinants of the Digital Orientation of Small Businesses

Abstract

A company oriented toward digitalization recognizes digital resources throughout the company and integrates them with value creation. Digital orientation, formed by a combination of market orientation, entrepreneurial orientation, relationship orientation, and technology orientation, is thus considered as a top strategic priority for companies to stay competitive. Prior studies call for further evidence on what determines the digital orientation of small businesses. We study the conditions under which small companies are likely to pursue different digital orientations, and which types of companies are most probably involved in embracing different digital orientations. The results show that the companies that have digitality well represented in their strategy embrace digital orientation more than the companies that do not have digitality well represented in their strategy. Also, companies’ willingness to grow affects the level of digital orientation, whereas competitive intensity in markets does not.