Skip to main content

The Chimera of the Simple Organization: What is the Relevant Design Knowledge Needed to Guide Small Business Digital Transformation?

  • Conference paper
  • First Online:
The Transdisciplinary Reach of Design Science Research (DESRIST 2022)

Abstract

The digital transformation of small businesses is different from larger businesses. Applying large business management approaches on a smaller scale may lead to missed opportunities to achieve meaningful digital transformation. In this paper, we explore what is the relevant design knowledge needed to guide small business digital transformation. To answer this question, we systematically reviewed small business and IS literature to identify seven key characteristics relevant to digital transformation. Based on these characteristics, we propose 20 mechanisms for small business digital transformation that are justified and illustrated using retrospective analysis of nine different cases across three continents. While some of the mechanisms are well known and relate to larger organizations, we also identified mechanisms that are unique to the small business context. With that, our contributions are twofold. We contribute to theory by identifying relevant design knowledge for small business digital transformation, and to practice by proposing mechanisms and real-world examples, especially for the design of small business platform providers.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 69.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Similar content being viewed by others

References

  1. Akpan, I.J., Ibidunni, A.S.: Digitization and technological transformation of small business for sustainable development in the less developed and emerging economies: a research note and call for papers. J. Small Bus. Entrepreneurship 1–7 (2021)

    Google Scholar 

  2. Akpan, I.J., Soopramanien, D., Kwak, D.-H.: Cutting-edge technologies for small business and innovation in the era of covid-19 global health pandemic. J. Small Bus. Entrep. 33(6), 607–617 (2021)

    Article  Google Scholar 

  3. Albats, E., Podmetina, D., Vanhaverbeke, W.: Open innovation in SMEs: a process view towards business model innovation. J. Small Bus. Manag. 1–42 (2021)

    Google Scholar 

  4. Anaya, J.A.: The promotion of Hungarian small and medium-size enterprises in accordance with guidelines for European Union enlargement. J. Small Bus. Enterp. Dev. 7(1), 18–26 (2000)

    Article  Google Scholar 

  5. Ano, B., Bent, R.: Human determinants influencing the digital transformation strategy of multigenerational family businesses: a multiple-case study of five French growth-oriented family firms. J. Family Bus. Manag., 1–16 (2021)

    Google Scholar 

  6. Arnold, C.: The foundation for economies worldwide is small business. International Federation of Accountants, Issues and Insights (2019). https://www.ifac.org/knowledge-gateway/contributing-global-economy/discussion/foundation-economies-worldwide-small-business-0. Accessed 10 Jan 2022

  7. Baber, W.W., Ojala, A., Martinez, R.: Effectuation logic in digital business model transformation. J. Small Bus. Enterp. Dev. 26(6/7), 811–830 (2019)

    Article  Google Scholar 

  8. Baumard, P.: An asymmetric perspective on coopetitive strategies. Int. J. Entrep. Small Bus. 8(1), 6–22 (2009)

    Google Scholar 

  9. Beckmann, M., Garkisch, M., Zeyen, A.: Together we are strong? A systematic literature review on how SMEs use relation-based collaboration to operate in rural areas. J. Small Bus. Entrepreneurship 1–35 (2021)

    Google Scholar 

  10. Bollweg, L., et al.: Drivers and barriers of the digitalization of local owner operated retail outlets. J. Small Bus. Entrep. 32(2), 173–201 (2020)

    Article  Google Scholar 

  11. Butler, T., Murphy, C.: An exploratory study on IS capabilities and assets in a small-to-medium software enterprise. J. Inf. Technol. 23(4), 330–344 (2008)

    Article  Google Scholar 

  12. Canhoto, A.I., et al.: Digital strategy aligning in SMEs: a dynamic capabilities perspective. J. Strateg. Inf. Syst. 30(3), 101682 (2021)

    Article  Google Scholar 

  13. Cannas, R.: Exploring digital transformation and dynamic capabilities in agrifood SMEs. J. Small Bus. Manag. 1–27 (2021)

    Google Scholar 

  14. Chanias, S., Myers, M.D., Hess, T.: Digital transformation strategy making in pre-digital organizations: the case of a financial services provider. J. Strateg. Inf. Syst. 28(1), 17–33 (2019)

    Article  Google Scholar 

  15. Daniel, E.: An exploration of the inside-out model: E-commerce integration in UK SMEs. J. Small Bus. Enterp. Dev. 10(3), 233–249 (2003)

    Article  Google Scholar 

  16. Depaoli, P., Za, S., Scornavacca, E.: A model for digital development of SMEs: an interaction-based approach. J. Small Bus. Enterp. Dev. 27(7), 1049–1068 (2020)

    Article  Google Scholar 

  17. Dremel, C., et al.: How AUDI AG established big data analytics in its digital transformation. MIS Q. Exec. 16(2), 81–100 (2017)

    Google Scholar 

  18. Fachrunnisa, O., et al.: Towards SMEs’ digital transformation: the role of agile leadership and strategic flexibility. J. Small Bus. Strateg. 30(3), 65–85 (2020)

    Google Scholar 

  19. Fauzi, A.A., Sheng, M.L.: The digitalization of micro, small, and medium-sized enterprises (MSMEs): an institutional theory perspective. J. Small Bus. Manag. 1–26 (2020)

    Google Scholar 

  20. Gherhes, C., et al.: Distinguishing micro-businesses from SMEs: a systematic review of growth constraints. J. Small Bus. Enterp. Dev. 23(4), 939–963 (2016)

    Article  Google Scholar 

  21. Gregor, S., Chandra Kruse, L., Seidel, S.: Research perspectives: the anatomy of a design principle. J. Assoc. Inf. Syst. 21(6), 1622–1652 (2020)

    Google Scholar 

  22. Hamilton, E.: Entrepreneurial learning in family business. J. Small Bus. Enterp. Dev. 18(1), 8–26 (2011)

    Article  MathSciNet  Google Scholar 

  23. Hatum, A., Pettigrew, A.: Adaptation under environmental turmoil: organizational flexibility in family-owned firms. Fam. Bus. Rev. 17(3), 237–258 (2004)

    Article  Google Scholar 

  24. Headd, B.: Small business facts: the role of microbusiness employers in the economy. U.S. Small Business Administration, Office of Advocacy (2017). https://advocacy.sba.gov/2017/08/01/the-role-of-microbusiness-employers-in-the-economy/

  25. Holopainen, R., Niskanen, M., Rissanen, S.: The impact of internet and innovation on the profitability of private healthcare companies. J. Small Bus. Entrepreneurship 1–25 (2020)

    Google Scholar 

  26. Kickul, J.: Promises made, promises broken: an exploration of employee attraction and retention practices in small business. J. Small Bus. Manag. 39(4), 320–335 (2001)

    Article  Google Scholar 

  27. L’Écuyer, F., Raymond, L.: Enabling the HR function of industrial SMEs through the strategic alignment of e-HRM: a configurational analysis. J. Small Bus. Entrepreneurship 1–33 (2020)

    Google Scholar 

  28. Lee, S.M., et al.: Effects of IT knowledge and media selection on operational performance of small firms. Small Bus. Econ. 32(3), 241–257 (2009)

    Article  Google Scholar 

  29. Li, L., et al.: Digital transformation by SME entrepreneurs: a capability perspective. Inf. Syst. J. 28(6), 1129–1157 (2018)

    Article  Google Scholar 

  30. Mandviwalla, M., Flanagan, R.: Small business digital transformation in the context of the pandemic. Eur. J. Inf. Syst. 30(4), 359–375 (2021)

    Article  Google Scholar 

  31. Pelletier, C., Cloutier, L.M.: Conceptualising digital transformation in SMEs: an ecosystemic perspective. J. Small Bus. Enterp. Dev. 26(6/7), 855–876 (2019)

    Article  Google Scholar 

  32. Pollard, D., Svarcova, J.: Promoting knowledge transfer to Czech SMEs: the role of human resource development in increasing absorptive capacity. Int. J. Entrep. Small Bus. 8(4), 499–515 (2009)

    Google Scholar 

  33. Proksch, D., et al.: The influence of a digital strategy on the digitalization of new ventures: the mediating effect of digital capabilities and a digital culture. J. Small Bus. Manag. 1–29 (2021)

    Google Scholar 

  34. Rashid, S., Ratten, V.: A dynamic capabilities approach for the survival of Pakistani family-owned business in the digital world. J. Family Bus. Manag. 10(4), 373–387 (2020)

    Article  Google Scholar 

  35. Rosin, A.F., et al.: Digital new ventures: assessing the benefits of digitalization in entrepreneurship. J. Small Bus. Strateg. 30(2), 59–71 (2020)

    Google Scholar 

  36. SBA fact sheet, The European Commission Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (2019). https://ec.europa.eu/docsroom/documents/38662/attachments/12/translations/en/renditions/native. Accessed 15 Jan 2022

  37. Sebastian, I., et al.: How big old companies navigate digital transformation. MIS Q. Exec. 16(3), 197–213 (2017)

    Google Scholar 

  38. Silver, M.S.: Decisional guidance for computer-based decision support. MIS Q. 15(1), 105–122 (1991)

    Article  Google Scholar 

  39. Small Business Counts, Australian Small Business and Family Enterprise Ombudsman. https://www.asbfeo.gov.au/sites/default/files/2021-11/ASBFEO%20Small%20Business%20Counts%20Dec%202020%20v2_0.pdf. Accessed 15 Jan 2022

  40. Soluk, J., Kammerlander, N.: Digital transformation in family-owned mittelstand firms: a dynamic capabilities perspective. Eur. J. Inf. Syst. 30(6), 1–36 (2021)

    Google Scholar 

  41. Taiminen, H.M., Karjaluoto, H.: The usage of digital marketing channels in SMEs. J. Small Bus. Enterp. Dev. 22(4), 633–651 (2015)

    Article  Google Scholar 

  42. Tse, T., Soufani, K.: Business strategies for small firms in the new economy. J. Small Bus. Enterp. Dev. 10(3), 306–320 (2003)

    Article  Google Scholar 

  43. United States Small Business Administration, Office of Advocacy (2019). https://cdn.advocacy.sba.gov/wp-content/uploads/2019/09/24154243/Frequently-Asked-Questions-Small-Business-2019-12.pdf. Accessed 31 Jan 2022

  44. Welsh, J.A., White, J.F.: A small business is not a little big business. Harvard Bus. Rev. 18–32 (1981)

    Google Scholar 

  45. Yoo, Y., Henfridsson, O., Lyytinen, K.: Research commentary—the new organizing logic of digital innovation: an agenda for information systems research. Inf. Syst. Res. 21(4), 724–735 (2010)

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Sarah Hönigsberg .

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2022 Springer Nature Switzerland AG

About this paper

Check for updates. Verify currency and authenticity via CrossMark

Cite this paper

Hönigsberg, S., Dias, M., Dinter, B., Mandviwalla, M. (2022). The Chimera of the Simple Organization: What is the Relevant Design Knowledge Needed to Guide Small Business Digital Transformation?. In: Drechsler, A., Gerber, A., Hevner, A. (eds) The Transdisciplinary Reach of Design Science Research. DESRIST 2022. Lecture Notes in Computer Science, vol 13229. Springer, Cham. https://doi.org/10.1007/978-3-031-06516-3_21

Download citation

  • DOI: https://doi.org/10.1007/978-3-031-06516-3_21

  • Published:

  • Publisher Name: Springer, Cham

  • Print ISBN: 978-3-031-06515-6

  • Online ISBN: 978-3-031-06516-3

  • eBook Packages: Computer ScienceComputer Science (R0)

Publish with us

Policies and ethics