Digital Business Adoption and its Impact on Business Performance and Sustainability among Community Entrepreneurs in Malaysia

The rapid advancement of digital technologies has transformed how small businesses create value, communicate with customers, manage transactions, and sustain market presence. Yet participation in digitalisation programmes does not necessarily result in sustained digital business adoption among community-based micro and small enterprises. This revised conceptual paper develops and strengthens an integrated framework for explaining digital business adoption and its downstream effects on business performance and business sustainability among community entrepreneurs in Malaysia. The framework combines the Technology Acceptance Model (TAM), Resource-Based View (RBV), and an institutional-support perspective, while drawing complementary explanatory insights from the Unified Theory of Acceptance and Use of Technology (UTAUT) and Diffusion of Innovations (DOI). Five antecedents are proposed: digital literacy, perceived usefulness, perceived ease of use, entrepreneurial orientation, and government support. Digital business adoption is positioned as a mediating mechanism linking these antecedents to business performance and business sustainability. The paper formally specifies testable hypotheses, defines community entrepreneurs and control variables, provides a measurement and operationalisation table with sample items and sources, and outlines a pilot study and validation procedures. A quantitative cross-sectional survey of approximately 300–400 Malaysian community entrepreneurs is proposed, with data analysed using PLS-SEM. The paper also explicitly addresses common method bias, cross-sectional limitations, and the limits of causal interpretation. The framework contributes by integrating technology perceptions, entrepreneurial capabilities, and institutional conditions into a single model focused on an underexamined Malaysian community-enterprise context.

Digital Business Adoption; Community Entrepreneurs; Business Performance

1. Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108 [Google Scholar] [Crossref]

2. Covin, J. G., & Slevin, D. P. (1989). Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10(1), 75–87. https://doi.org/10.1002/smj.4250100107 [Google Scholar] [Crossref]

3. Davis, F. D. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly, 13(3), 319–340. https://doi.org/10.2307/249008 [Google Scholar] [Crossref]

4. Elkington, J. (1997). Cannibals with forks: The triple bottom line of 21st century business. Capstone. [Google Scholar] [Crossref]

5. Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203 [Google Scholar] [Crossref]

6. Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43, 115–135. https://doi.org/10.1007/s11747-014-0403-8 [Google Scholar] [Crossref]

7. Hertel, C. J., & Belz, F.-M. (2017). Community entrepreneurship: A systematic review, conceptual clarifications and future directions. Academy of Management Proceedings, 2017(1), 11199. [Google Scholar] [Crossref]

8. https://doi.org/10.5465/AMBPP.2017.11199 [Google Scholar] [Crossref]

9. Kock, N. (2015). Common method bias in PLS-SEM: A full collinearity assessment approach. International Journal of e-Collaboration, 11(4), 1–10. https://doi.org/10.4018/IJEC.2015100101 [Google Scholar] [Crossref]

10. Lumpkin, G. T., & Dess, G. G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21(1), 135–172. [Google Scholar] [Crossref]

11. https://doi.org/10.5465/amr.1996.9602161568 [Google Scholar] [Crossref]

12. Malesios, C., Dey, P. K., & Abdelaziz, F. B. (2020). Supply chain sustainability performance measurement of small and medium sized enterprises using structural equation modeling. Annals of Operations Research, 294, 623–653. https://doi.org/10.1007/s10479-018-3080-z [Google Scholar] [Crossref]

13. Organisation for Economic Co-operation and Development. (2021). The digital transformation of SMEs. OECD Publishing. https://doi.org/10.1787/bdb9256a-en [Google Scholar] [Crossref]

14. Podsakoff, P. M., MacKenzie, S. B., Lee, J.-Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879–903. https://doi.org/10.1037/0021-9010.88.5.879 [Google Scholar] [Crossref]

15. Ramdan, M. R., Abdullah, N. L., Mat Isa, R., & Hanafiah, M. H. (2020). Meneroka faktor-faktor yang mempengaruhi penggunaan platform digital oleh perusahaan mikro dan kecil. Jurnal Pengurusan, 59, 37–51. https://doi.org/10.17576/pengurusan-2020-59-05 [Google Scholar] [Crossref]

16. Roman, A., & Rusu, V. D. (2022). Digital technologies and the performance of small and medium enterprises. Studies in Business and Economics, 17(3), 190–203. https://doi.org/10.2478/sbe-2022-0055 [Google Scholar] [Crossref]

17. Rogers, E. M. (2003). Diffusion of innovations (5th ed.). Free Press. [Google Scholar] [Crossref]

18. Shahadat, M. M. H., Nekmahmud, M., Ebrahimi, P., & Fekete-Farkas, M. (2023). Digital technology adoption in SMEs: What technological, environmental and organizational factors influence in emerging countries? Global Business Review. https://doi.org/10.1177/09721509221137199 [Google Scholar] [Crossref]

19. Van Laar, E., Van Deursen, A. J. A. M., van Dijk, J. A. G. M., & de Haan, J. (2017). The relation between 21st-century skills and digital skills: A systematic literature review. Computers in Human Behavior, 72, 577–588. https://doi.org/10.1016/j.chb.2017.03.010 [Google Scholar] [Crossref]

20. Venkatraman, N., & Ramanujam, V. (1986). Measurement of business performance in strategy research: A comparison of approaches. Academy of Management Review, 11(4), 801–814. [Google Scholar] [Crossref]

21. https://doi.org/10.5465/amr.1986.4283976 [Google Scholar] [Crossref]

22. Venkatesh, V., Morris, M. G., Davis, G. B., & Davis, F. D. (2003). User acceptance of information technology: Toward a unified view. MIS Quarterly, 27(3), 425–478. https://doi.org/10.2307/30036540 [Google Scholar] [Crossref]

• Entrepreneurship and Start-Up Ecosystem Vis-À-Vis Government Start-Up Scheme in Manipur: A Critical Review and a Way Forward
• Building Resilience: How Malaysian Women Entrepreneurs Use Strengths and Resources to Navigate Challenges
• Branding in Digital Entrepreneurship: Evaluating Branding Criteria in IT Entrepreneurship
• Bridging the Intention–Action Gap through Entrepreneurial Optimism: A Conceptual Exploration
• Entrepreneurial Orientation of Undergraduate Students in University Malaysia Perlis: A Conceptual Paper