Connecting SME Big Data Analytic Capability, Artificial Intelligence Platform and Digital Transformation to Strategic Innovation Capability: The Moderating Role of Data Governance

Tay, Alvin Wen Yng (2024) Connecting SME Big Data Analytic Capability, Artificial Intelligence Platform and Digital Transformation to Strategic Innovation Capability: The Moderating Role of Data Governance. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

According to a report published by the SME in year 2020, 98.5% of Malaysia establishments were small and medium enterprise (SME) or closed to a million of business entities in this ecosystem by putting these into perspective of Malaysia population of 33 million against 1 million businesses (SME Corp 2020). Klang Valley has the largest concentration of 35.5% that translate into 211,974 SME’s (DOS 2021). Thus, the sizable of SMEs in Malaysia allows the researcher to have a better understanding in evaluating the integration of technological innovations to create strategic innovation capability among the SMEs. Digital technology has become indispensable in today’s hypercompetitive world be it enterprise or household, digital technology has penetrated every level and aspect of society. Mastering and leveraging these digital technologies can give organisation a competitive edge over its rival. Combining by adopting various technologies such as Artificial Intelligence, Big Data Analytic Capability, Digital Transformation and Data Governance in today small and medium enterprises (SME), it will enable the firms leapfrog to a better competitive position. By reviewing the existing research on strategic innovation capability, there is lacking empirical research to investigate the relationship between artificial intelligence platform and big data analytic capability and digital transformation. Therefore, this research aims to understand how small and medium enterprises can gain strategic innovation capability through various digital technology such as big data analytic and digital transformation and the moderation role of data governance. For the conceptual framework development, resource-based view (RBV) and dynamic capabilities (DC) were used as a theoretical support of the framework development. This research investigates the direct relationship between big data analytic capability, artificial intelligence platform, digital transformation towards strategic innovation capability. Moreover, this research also establishes the moderator role of data governance on big data analytic capability, artificial intelligence platform, digital transformation toward archiving strategic innovation capability. To implement the research objectives, a total of 350 samples were collected through faceto- face questionnaire survey and the data is analysed by using Statistical Package for Social Sciences (SPSS). Based on the statistic outcomes generated, all the direct relationships between big data analytic capability, artificial intelligence platform, digital transformation toward strategic innovation capability are significantly supported. For moderation relationships of data governance, the moderation relationships are significantly supported except for digital transformation. With the results generated in this research, contributes theoretical implications and managerial implications by proving small and medium enterprise (SME) can achieve strategic innovation capability through big data analytic capability, artificial intelligence platform and digital transformation. The moderation role of data governance in this study also points out that information security and data privacy play a significant role in determining the success of digital technology implementation. At the end of the research, limitations and recommendations of this research were suggested such as research can be replicated in Northen state of peninsular Malaysia and East Malaysia where digital divide are greater significant among states and digital literacy were at its infancy and also future research can focus manufacturing sector that are more internal driven in developing new products and services as compare to those from service sector that are more dynamic and customer centric.