Digital transformation and organizational readiness: evidence from Chinese construction SMEs with a dynamic managerial capabilities lens
Kaiyang Wang, Xiaoxiao Xu, Peng Mao, Xiaopeng Deng, Dongping Cao
Abstract
Purpose In the digital economy, the adoption and implementation of digital transformation (DX) is essential for small and medium-sized enterprises (SMEs) in the construction industry to secure a competitive advantage and achieve sustainability. This study examines the dynamic managerial capabilities of SME leaders and the organizational readiness required to facilitate DX. Design/methodology/approach Drawing on insights from 33 managers across six SMEs, the study identifies key dynamic capabilities, organizational readiness factors, and transformation challenges. The framework was further refined and validated through a Delphi process, resulting in a four-layer model that links internal capabilities to specific DX challenges and provides a structured roadmap for SME transformation. Findings Our findings reveal that DX in construction SMEs is driven by five dynamic capabilities: environmental sensing, strategic agility, resource mobilization, digital ecosystem building and organizational learning. In addition, organizational readiness serves as a critical enabler, shaped by leadership and cultural readiness, policy and stakeholder alignment and technological preparedness. Building on these insights, we propose a four-layer integrative framework that links these capabilities and readiness factors to specific internal and external challenges, providing a structured pathway for overcoming barriers and facilitating effective DX in construction SMEs. Originality/value This study provides actionable insights by clarifying how construction SMEs strategically organize and leverage DX-related resources and capabilities to drive change and maintain a competitive edge. It contributes to theory by introducing an integrative framework that illuminates the interrelationships among these resources, managerial competencies and readiness factors, offering a detailed roadmap for implementing and sustaining DX.