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Digital Innovation and Entrepreneurial Success in the Philippine MSME Sector: Challenges and Opportunities

Author

Listed:
  • Cordova Wilson

    (Department of Decision Sciences and Innovation, De La Salle University, Philippines)

  • Lim Cristina Teresa N.

    (Department of Decision Sciences and Innovation, De La Salle University, Philippines)

  • Ong Harvey T.

    (Department of Decision Sciences and Innovation, De La Salle University, Philippines)

  • Caraan Hilario S.

    (Department of Commercial Law, De La Salle University, Philippines)

  • Dela Cruz Gil Antonio R.

    (Department of Decision Sciences and Innovation, De La Salle University, Philippines)

  • Jimenez Emmanuel Fernando C.

    (Department of Decision Sciences and Innovation, De La Salle University, Philippines)

Abstract

While digital tools are becoming more accessible in emerging economies, MSMEs in the Philippines are still unable to adopt them. The study aims to examine how digital innovation can help in the entrepreneurial success of the Philippine MSME sector by identifying the barriers and opportunities in digital adoption. Mixed-method approach of surveying MSME owners and interviewing industry experts. The survey was designed to determine how digital adoption. What types of digital tools are being used, and what barriers are perceived. Data analysis used statistical methods and thematic analysis. The findings indicate that while the MSMEs are becoming more digital embracing social media marketing, digital payment systems, and other digital tools, they have not leveraged the adoption of more advanced technologies such as cloud computing and ERP systems. To identify the leading obstacles to digital adoption, the first three were identified: cultural resistance, lack of technical expertise, and financial constraints. Other issues that prevent digital transformation from taking off in regional terms include infrastructure and regulatory issues. The study highlights the need for policy interventions and capacity-building programs, emphasizing changes in digital adoption barriers facing MSMEs. It is suggested that more access to digital tools at affordable prices, training, and raising awareness on the importance of digital innovation. Further research on longitudinal studies, industry-specific research, and cross-country research will be needed to better understand the effect of digital adoption on MSME performance.

Suggested Citation

  • Cordova Wilson & Lim Cristina Teresa N. & Ong Harvey T. & Caraan Hilario S. & Dela Cruz Gil Antonio R. & Jimenez Emmanuel Fernando C., 2025. "Digital Innovation and Entrepreneurial Success in the Philippine MSME Sector: Challenges and Opportunities," Economics, Sciendo, vol. 13(3), pages 69-82.
    • Handle: RePEc:vrs:econom:v:13:y:2025:i:3:p:69-82:n:1004
    DOI: 10.2478/eoik-2025-0056
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    Keywords

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    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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