Digital Transformation on the Competitive Advantage of Small and Medium Enterprises (SMEs) in Kenya

Purpose: To aim of the study was to analyze the digital transformation on the competitive advantage of small and medium enterprises (SMEs) in Kenya Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries. Findings: Digital transformation significantly boosts the competitive advantage of SMEs in Kenya by improving efficiency, market reach, and innovation. However, challenges such as high implementation costs, limited infrastructure, and skills gaps hinder broader adoption, especially in rural areas. Addressing these barriers is essential for SMEs to fully harness the potential of digital technologies and sustain their competitive position in the market. Unique Contribution to Theory, Practice and Policy: The resource-based view, the dynamic capabilities theory (DCT) the technology organization environment (TOE) Framework may be used to anchor future studies on the digital transformation on the competitive advantage of small and medium enterprises (SMEs) in Kenya. SMEs are encouraged to adopt integrated digital solutions that combine cloud computing, e-commerce platforms, data analytics, and automation to strengthen competitiveness holistically. At the policy level, the Kenyan government and relevant stakeholders should prioritize the creation of a supportive digital ecosystem for SMEs.