Technological Capabilities and Digital Transformation of Industrial SMEs Toward Sustainable Adaptation to Industry 4.0 Environment: A Theory-Building Approach

Abstract

This study provides a systematic analysis of technological capabilities and their impact on the digital transformation of industrial small and medium-sized enterprises (SMEs) to develop an Industry 4.0 environment. A semi-systematic literature review was conducted, from which the authors identified and selected 117 articles for their relevance and contributions to be further studied, and framed to achieve the research objectives. The authors identified the following variables of analysis: technologies and digitalization, technological capabilities, infrastructure, and strategies. Furthermore, the study identified promoting and hindering factors to the digital transformation of industrial SMEs, along with the technological capabilities that drive it, thereby generating opportunities and challenges for improving their integration into Industry 4.0. As the promoting and inhibiting factors, the following were determined: culture, leadership and entrepreneurial orientation, market orientation, processes and operations, people and business environment. Government support, access to technology, leadership and strategy, and employees stand out as factors that, when limited or absent, restrict SMEs’ ability to manage and increase their maturity level to integrate into Industry 4.0. From a resource-based view and dynamic capability theory, this research advances theory by presenting four propositions that integrate the identified technological capabilities and driving factors into a capability-based framework. This framework will serve as the foundation for a capability-based roadmap to guide industrial SMEs toward an Industry 4.0 environment and achieve sustainability outcomes.