DIGITAL TRANSFORMATION AND INNOVATION IN MOROCCAN SMALL, MEDIUM-SIZED, AND VERY SMALL ENTERPRISES: EFFECTS ON FINANCIAL PERFORMANCE

Authors

  • Zouhir Adile Faculty of Economics and Management Laboratory of Economics and Organisations Management, Ibn Tofail University, Kenitra, Morocco
  • Sossi Alaoui Fatimazohra Faculty of Economics and Management Laboratory of Economics and Organisations Management, Ibn Tofail University, Kenitra, Morocco
  • Badr Guennoun Ibn Tofail University, Higher School of Education and Training, Laboratory of Economics and Organisations Management, Department of Education and Training, Morocco

DOI:

https://doi.org/10.2478/eoik-2025-0088

Keywords:

Digital transformation, Strategy, Business innovation, Financial performance

Abstract

In a context shaped by accelerating digitalization, this study exam-
ines the effects of digital transformation on the financial performance

of Moroccan small and very small enterprises, while emphasizing

the mediating role of innovation. Based on a sample of 223 compa-
nies across various regions and sectors, the analysis was conducted

using partial least squares structural equation modeling to assess the
structural relationships between the variables. The results show, first,

that digital transformation directly enhances firms’ innovation capac-
ity, confirming its role as a strategic lever for organizational renewal.

Second, the study demonstrates that digital transformation has only a
marginal direct impact on financial performance, but exerts a strong
indirect effect through innovation, which acts as a partial mediator.
Furthermore, different forms of innovation process and product affect

financial outcomes in distinct ways. These findings highlight the ne-
cessity for small and very small enterprises to develop coherent digital

strategies that integrate innovation as a driver of competitiveness. The

study provides both theoretical and practical recommendations for pol-
icymakers, business leaders, and support institutions to strengthen the

resilience and performance of Moroccan enterprises in the digital age.

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Published

2025-12-01

How to Cite

Zouhir Adile, Sossi Alaoui Fatimazohra, & Badr Guennoun. (2025). DIGITAL TRANSFORMATION AND INNOVATION IN MOROCCAN SMALL, MEDIUM-SIZED, AND VERY SMALL ENTERPRISES: EFFECTS ON FINANCIAL PERFORMANCE. ECONOMICS - INNOVATIVE AND ECONOMICS RESEARCH JOURNAL, 13(4), 131–150. https://doi.org/10.2478/eoik-2025-0088

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Vol. 13 No. 4 (2025): ECONOMICS - Innovative and Economics Research Journal

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Original Scientific Paper

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