Driving SME Growth Through Digital Leadership: Exploring Tenure and Transformation Dynamics

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

The summary of the paper "Sustaining SMEs Through Digital Leadership: The Leadership Tenure as a Moderator and Digital Transformation as a Mediator" corresponds to the paper's content. The keywords are adequate and sufficient.

The paper is written in clear language and meets the standard of a publication in a journal of this academic level.

The introduction is well-written; however, the research questions or hypotheses should be stated more clearly to provide an immediate understanding of the study’s focus.

Using the Structural Equation Modelling (SEM) technique is appropriate for testing the proposed hypotheses. The methodology is correctly structured and aligns with scientific research standards.

The literature review is relevant, and the literature analysis is well-connected to the hypotheses. The cited literature is recent and up-to-date. However, the formatting of the references should be corrected. (pages 9-12; lines 361-461). The publication years are sometimes placed at the beginning in parentheses and sometimes at the end of the reference. The formatting should be consistent throughout the reference list.

Some references are incomplete, such as reference 25 (page 11; lines 423-425) or reference 38 (page 12; lines 460-461). There are other incomplete sources, so the entire reference list should be standardized and completed.

A notable contribution of the paper is developing a model visually representing the relationships between the constructs under study. These relationships are well-presented and explained, including in Table 1.

Different fonts appear in some parts of the paper (e.g., page 3, lines 121-123).

Certain numerical values are written unclearly, lacking commas and periods to indicate thousands. This should be adjusted to conform to English writing conventions and applied consistently throughout the paper:

• “The digital-oriented SMEs are 35% among the total 334304 SMEs” (page 5, line 207)
• “As per the Raosoft sample size calculator, considering a margin of error of 5%, a response distribution of 40%, and a 95% confidence interval, and assuming 35% of the 334304 SMEs population of 117006 digital-oriented SMEs, the minimum sample size is 368 needed. However, this study has targeted 1000 SMEs for data collection.” (page 5, lines 213-216)

Overall, the paper presents interesting conclusions, well-explained research limitations, practical implications, and directions for further academic work on this and related topics.

Author Response

The summary of the paper "Sustaining SMEs Through Digital Leadership: The Leadership Tenure as a Moderator and Digital Transformation as a Mediator" corresponds to the paper's content. The keywords are adequate and sufficient.
The paper is written in clear language and meets the standard of a publication in a journal of this academic level.
The introduction is well-written; however, the research questions or hypotheses should be stated more clearly to provide an immediate understanding of the study’s focus.

Response:

Thank you for the suggestion. We have provided further clarity and added the research question. Please check the bottom of page 2-3 (written in Red):

 

Therefore, this research is novel and proposes the following research questions:

• Does digital leadership have a significant and positive link with SMEs sustainability?
• Does digital transformation mediate the relationship between digital leadership and SMEs sustainability?
• Is leadership tenure moderating the effect of digital leadership on digital transformation?  

Using the Structural Equation Modelling (SEM) technique is appropriate for testing the proposed hypotheses. The methodology is correctly structured and aligns with scientific research standards.

The literature review is relevant, and the literature analysis is well-connected to the hypotheses. The cited literature is recent and up-to-date. However, the formatting of the references should be corrected. (pages 9-12; lines 361-461). The publication years are sometimes placed at the beginning in parentheses and sometimes at the end of the reference. The formatting should be consistent throughout the reference list.

Response:

Thank you for pointing out the formatting error and spelling check. We have revised it throughout the paper. Please check in red all the in-text citations throughout the paper, especially between page 6-15).

Thank you for pointing out the formatting error and spelling check. We have revised it throughout the paper. Please check in red all the in-text citations throughout the paper, especially between page 6-15).

Key notables are as follows:  Podsakoff, et al. [40]  (page 8)

Zhao, et al. [41] (Page 10)

Some references are incomplete, such as reference 25 (page 11; lines 423-425) or reference 38 (page 12; lines 460-461). There are other incomplete sources, so the entire reference list should be standardized and completed.

Thank you, we have rechecked and improved all references. We ensured standardized and completed reference.

A notable contribution of the paper is developing a model visually representing the relationships between the constructs under study. These relationships are well-presented and explained, including in Table 1.

Different fonts appear in some parts of the paper (e.g., page 3, lines 121-123).

Response:

Thank you. We proofread and ensure that the font style appear consistent (i.e., Palatino Linotype, size 10 from introduction to references, while Palatino Linotype font size 9 for abstract, as per the guidelines of Journal template).

Certain numerical values are written unclearly, lacking commas and periods to indicate thousands. This should be adjusted to conform to English writing conventions and applied consistently throughout the paper:

• “The digital-oriented SMEs are 35% among the total 334304 SMEs” (page 5, line 207)

“As per the Raosoft sample size calculator, considering a margin of error of 5%, a response distribution of 40%, and a 95% confidence interval, and assuming 35% of the 334304 SMEs population of 117006 digital-oriented SMEs, the minimum sample size is 368 needed. However, this study has targeted 1000 SMEs for data collection.” (page 5, lines 213-216)

Response:

Thank you for indicating it. We have addressed it. Please see the following:

On Page 6 (in Red):

Nonetheless, 30.3% are SMEs in total businesses in Malaysia [30]. The digital-oriented SMEs are 35% among the total 3,34,304 SMEs [31].

Further, on Page 6(in Red):

The present study actual sampling frame considered 1,17,006 SMEs and minimum sample size is 368 required as per Raosoft sample size formula [32], the details of the sample as per business type can see in table 1. However, this study has targeted 1000 SMEs for data collection to achieve the required sample size. Nonetheless, the current study recorded the response rate at 36.8%.

Overall, the paper presents interesting conclusions, well-explained research limitations, practical implications, and directions for further academic work on this and related topics.

Response: 

Thank you for your appreciation.

Author Response File: Author Response.docx

Reviewer 2 Report

Comments and Suggestions for Authors

This paper explores the mediating role of the executive mandate between digital leadership and SME sustainability, and the moderating role of the executive mandate in the relationship between digital leadership and digital transformation. The paper is adequate, but suggests some minor or major adjustments.

My first request concerns the title of the study. The title of the paper generally refers to the subject of the research, but it only refers to Malaysia, it would be helpful to clarify this in the title and in the abstract.

The second concerns the references to the literature. Please use APA style throughout the paper.

The jargon of the paper is adequate, but it does contain a few influential passages which it would be better to avoid (Taylor Swift, seeds and wilted lettuce)

I could not find a reference to the 35% of SMEs being digitally oriented, please include this in the study.

The methodology chosen is appropriate, the graphical presentation and explanation of the results is adequate. Conclusions and parallels with the literature are appropriate.

Author Response

This paper explores the mediating role of the executive mandate between digital leadership and SME sustainability, and the moderating role of the executive mandate in the relationship between digital leadership and digital transformation. The paper is adequate, but suggests some minor or major adjustments.

My first request concerns the title of the study. The title of the paper generally refers to the subject of the research, but it only refers to Malaysia, it would be helpful to clarify this in the title and in the abstract.

Response:

Thank you for the constructive suggestions. We have addressed.

In the revised draft we have incorporated SMEs in title and abstract, while avoiding using Malaysia as main reference point (Please see Page 1):

 

Title: Driving SME Growth through Digital Leadership: Exploring Tenure and Transformation Dynamics  

Abstract: The main objective of the study is to investigate the role of digital leadership in sustainability of SMEs. Furthermore, this study examines the mediating role of a digital transformation between digital leadership and SMEs sustainability and the moderating role of leadership tenure on the relationship between digital leadership and digital transformation.

The second concerns the references to the literature. Please use APA style throughout the paper.

Response:

Thank you. However, we followed the template of Journal that uses MDPI referencing style, which is more align with IEEE rather than APA. Thank you for the reminder, we double-checked again and ensured it is aligned with journal requirement style.

The jargon of the paper is adequate, but it does contain a few influential passages which it would be better to avoid (Taylor Swift, seeds and wilted lettuce)

Thank you for pointing out this important aspect. We reconsidered the style of writing.

The metaphor of Taylor Swift has been erased.

Please check Page 4 for revised work with better phrases, avoiding seeds and wilted lettuce.

Page 4:

Research shows that digital transformation acts as the bridge between a leader’s tech-savvy vision and an SME's long-term survival [25]. It is like building a strong foundation: the leader provides the vision, and digital tools make the business bloom through better customer service, smoother operations, and wider market reach. Without that tech innovation, even the most promising business ideas might struggle to survive and thrive. Perhaps, it might lose its competitive edge. For SMEs, embracing digital technologies to a full extent is crucial for survival and growth. Investing in technology, adapting swiftly to changes, and adopting strong digital leadership are key to navigating the evolving business landscape.

I could not find a reference to the 35% of SMEs being digitally oriented, please include this in the study.

Response:

Thank you for highlighting the concern. We have added the reference:

Please see page 6:

The digital-oriented SMEs are 35% among the total 3,34,304 SMEs [31].

Reference

Economic Planning Unit, P.M.s.D. Malaysia Digital Economy Blueprint; Economic Planning Unit, Prime Minister’s Department, Malaysia: Putrajaya, Malaysia, 2021.

The methodology chosen is appropriate, the graphical presentation and explanation of the results is adequate. Conclusions and parallels with the literature are appropriate.

Response:

Thank you for the constructive feedback. We appreciate your time and suggestions.

 

 

Author Response File: Author Response.docx

Reviewer 3 Report

Comments and Suggestions for Authors

Thanks for the opportunity to review this article; it is interesting; however, I would like to note the following points:

1.       I advise using this title, “Driving SME Growth through Digital Leadership: Exploring Tenure and Transformation Dynamics.”.

2.       I am wondering why the authors have not examined the relationship between digital leadership and digital transformation, this could provide interesting insight. Digital leadership involves guiding a business through adopting new technologies, setting a vision for digital change, and inspiring teams to embrace innovation. Digital transformation, on the other hand, is the actual process of integrating digital tools and strategies into business operations. It should be H2.

3.       In the abstract you mentioned, “This study examines the mediating role of a leadership tenure between digital leadership and SMEs sustainability," this relationship does not exist in the model you have developed. Please check or amend the abstract.

4.       Clearly focus on the research gap and motives of the study.

5.       Clearly declare your research questions.

6.       Please show the breakup of the sample of the study? Were they all micro, small or medium? Please also show types of businesses: wholesale, retail, services, agriculture, small crafts and others.

7.       Please cite articles that support the use of convenience sampling; please refer to : “Surviving the Storm: The Vital Role of Entrepreneurs’ Network Ties and Recovering Capabilities in Supporting the Intention to Sustain Micro and Small Enterprises”, (2024) and enrich your literature with it.

8.       Please explain the importance of collecting data from micro and small entrepreneurs and the role they play in the economy.

9.       Please attach the questionnaire you have used in the appendix to allow further replication of your work and to ensure more validity and reliability.

10.   You may remove those empty columns and rows and the table 2.

11.   In table 4 you should have 3 direct relationships, one moderator and one mediator. Try to organize the able, show whether it is partial or full mediation.

12.   Discussion is poorly written; explain deeply your findings and justify the result; compare your findings with other findings.

13.   Develop two separate sections for both theoretical and practical implications.

14.   Show the VIF and CMB.

 

 

All the best

Comments on the Quality of English Language

NA

Author Response

Thanks for the opportunity to review this article; it is interesting; however, I would like to note the following points:

  1. I advise using this title, “Driving SME Growth through Digital Leadership: Exploring Tenure and Transformation Dynamics.”

Thank you for the constructive feedback. We have considered the suggested title.

Please see the revised title, now it reads:

Driving SME Growth through Digital Leadership: Exploring Tenure and Transformation Dynamics  

2. I am wondering why the authors have not examined the relationship between digital leadership and digital transformation, this could provide interesting insight. Digital leadership involves guiding a business through adopting new technologies, setting a vision for digital change, and inspiring teams to embrace innovation. Digital transformation, on the other hand, is the actual process of integrating digital tools and strategies into business operations. It should be H2.

Response:

Thank you, this is an interesting observation. We discussed between authors and due to my personal health issues, I am struggling to work further on it while other authors have also different personal issues. Therefore, we accept this interesting notion and have included as a limitation of this study, serving the foundation for future studies. Please see the limitation and future direction section (Page: 15).

Due to time constraints, we did not assess the relationship between digital leadership and digital transformation. This would have provided interesting insight; however, this serves as a foundation for future studies to consider. Future researchers are suggested to consider exploring the direct relationship between digital leadership and digital transformation. This could help future studies by unearthing some new insights into research variables. 

3.       In the abstract you mentioned, “This study examines the mediating role of a leadership tenure between digital leadership and SMEs sustainability," this relationship does not exist in the model you have developed. Please check or amend the abstract.

Response:

hank you for highlighting it. We acknowledge it. Abstract is amended (See Page 1):

The main objective of the study is to investigate the role of digital leadership in sustainability of SMEs. Furthermore, this study examines the mediating role of a digital transformation between digital leadership and SMEs sustainability and the moderating role of leadership tenure on the relationship between digital leadership and digital transformation. This research provides a unique perspective by exploring these connections within the context of developing countries, by considering Malaysia as a case study. We employed Structural Equation Modelling (SEM) technique to analyze the 368 respondents’ data. The study results found a positive relationship between digital leadership and SMEs’ sustainability. Furthermore, it also revealed the positive and significant mediating role of digital transformation between digital leadership and SMEs sustainability. Examining mediating and moderating factors provided valuable insights for SMEs and policymakers alike. Research findings contribute to both theoretical understanding and practical applications.

4. Clearly focus on the research gap and motives of the study.

Response:

Thank you for the suggestion. We have further added details to clarify the identified gap and motivation behind the study. Please see Page 3:

 

A significant gap has been evident regarding the leadership tenure’s role in affecting the relationship between digital leadership and digital transformation, especially in the context of SMEs. Although, there is growing interest among academics and scholars about transformation and digital leadership, yet the information at hand is one-dimensional and limited to broader industries, excluding specificity of SMEs.

The literature at hand confirms the examination of digital transformation in businesses, yet fewer have explored moderation effect of leadership tenure on variables of interest in context of long-term sustainability. Few studies have examined particularly in emerging countries context, especially in Malaysia how leadership tenure moderates the relationship. By focusing on Malaysia as a case study, this study aims to fill this gap by offering a unique perspective on ways digital leadership, digital transformation, and leadership tenure collectively contribute to SME sustainability. SMEs and policymakers in developing regions seeking to harness digital technologies for long-term success and business growth can benefit greatly from the research's insightful findings.

5. Clearly declare your research questions.

Response:

Thank you for the suggestion. We have provided further clarity and added the research question. Please check the bottom of page 2-3 (written in Red):

 

The following research questions:

• Does digital leadership have a significant and positive link with SMEs sustainability?
• Does digital transformation mediate the relationship between digital leadership and SMEs sustainability?
• Is leadership tenure moderating the effect of digital leadership on digital transformation?  

6. Please show the breakup of the sample of the study? Were they all micro, small or medium? Please also show types of businesses: wholesale, retail, services, agriculture, small crafts and others.

Response:

Thank you. We have provided now Table 1 showing the details of types of SMEs. Please check Page 6:

Table 1: Sample description

Type of business	Size of business	No of employees	Total No
Retail	Small	Above 5	54
Food & Beverages	Micro	Less 5	88
Services	Small	Above 5	107
Automotive	Small	Above 5	66
Beauty and personal care	Small	Above 5	25
Telecommunication	Small	Above 5	28

The size of business has identify using number of employees criteria as per Malaysia [34].

7. Please cite articles that support the use of convenience sampling; please refer to : “Surviving the Storm: The Vital Role of Entrepreneurs’ Network Ties and Recovering Capabilities in Supporting the Intention to Sustain Micro and Small Enterprises”, (2024) and enrich your literature with it.

Response:

Thank you. We have considered the suggestion and incorporated it. Reference [33], Page 17:

33.        Alshebami, A.S. Surviving the Storm: The Vital Role of Entrepreneurs’ Network Ties and Recovering Capabilities in Supporting the Intention to Sustain Micro and Small Enterprises. Sustainability 2024, 16, 8474.

8. Please explain the importance of collecting data from micro and small entrepreneurs and the role they play in the economy.

Response:

Thank you. We have provided further details (Please see page 6):

 

Understanding the wider effects of digital leadership and change on companies of all sizes requires gathering data from micro and small entrepreneurs, particularly as these companies are the foundation of many economies.  Particularly in developing nations, micro and small businesses (MSEs) are frequently the most prevalent commercial entities. They are essential to economic growth, employment creation, and poverty reduction.  For instance, in Malaysia, SMEs employ a sizable share of the labor force and contribute significantly to the country's GDP.  Through the collection of information from these business owners, this research offers insightful information on the unique possibilities and difficulties they encounter while using digital leadership techniques. Additionally, because micro and small firms often have limited resources and encounter particular challenges throughout the digital adoption process, it is crucial to comprehend the link between digital leadership, digital transformation, and sustainability within these organizations.  They provide insights that are vital for policymakers seeking to promote inclusive economic growth, and their inclusion in this study serves to illustrate how digital leadership can assist even the tiniest enterprises achieve sustainability and compete in a digital economy.

9.       Please attach the questionnaire you have used in the appendix to allow further replication of your work and to ensure more validity and reliability.

Response:

Thank you. We have added a questionnaire in the Appendix (Please see page 15-16).

10.   You may remove those empty columns and rows and the table 2.

Response:

Thank you. Yes, we have removed the empty columns and rows from Table 2. Please see page 9. 

11.   In table 4 you should have 3 direct relationships, one moderator and one mediator. Try to organize the able, show whether it is partial or full mediation.

Response:

Thank you, we have opted to use the approach of Preacher & Hayes (2004) for estimating indirect effect. However, we have improved the work in Table 7. We also showed partial mediation. Please see page 11:

Furthermore, in respect of mediation type, this study used the Zhao, et al. [41] approach and using the figure 3 to identify the type of mediation. As per findings of hypothesis 2, found the complementary mediation (partial mediation).

12. Discussion is poorly written; explain deeply your findings and justify the result; compare your findings with other findings.

Response:

Thank you. Please see the revised Discussion section (Page 11-13).

 

The findings of the study found a positive and significant relationship between digital leadership and SMEs sustainability in the Malaysian context; hence, hypothesis 1 is accepted. This finding is also consistent with the study of Lathabhavan and Kuppusamy [42], which also found that business sustainability is further strengthen and promoted by digital leadership, hence, confirming it plays a vital role for business, irrespective of size and type. In addition to that, he positive impact of digital leadership could also be attributed to the ability of a leader in guiding SMEs through challenging times, especially in the era of digital technological complexities, nurturing an environment that continue to embrace and encourages innovation, improved customer service, and maintain competitive edge in dynamic markets. It is confirmed that our finding is consistent with the broader literature on digital leadership that indicates digital leadership effectiveness is vital for achieving long-term growth and sustainability in the constantly changing business environment. In other words, sustainability in VUCA (volatile, uncertain, complex, and ambiguous) environment.

The mediating role of digital transformation between digital leadership and SMEs sustainability was observed to be both positive and significant in this study. This finding confirms the acceptance of Hypothesis-2, which proposed such a relationship.

The study demonstrated that digital transformation partially mediates the relationship between digital leadership and sustainability. This suggests that while digital leadership directly impacts SME sustainability, its full potential is realized when combined with the strategic integration of digital transformation. This finding aligns with the work of previous researchers who emphasize the synergistic relationship between leadership and digital transformation in enhancing business sustainability. It could also be narrated from the results at hand that the analysis demonstrated that digital transformation plays a partial mediating role between digital leadership and SMEs sustainability. This implies that digital leadership not only has a direct impact on the sustainability of SMEs but also influences it indirectly through the processes and strategies associated with digital transformation. In other words, the integration of digital transformation amplifies the effectiveness of digital leadership in achieving sustainable outcomes for SMEs. To put it simply, digital leadership becomes more impactful and influential when supported by digital transformation approaches, which enhance the ability of SMEs to maintain and improve their performance over time in a competitive and ever-changing business environment.

The digital transformation’s mediating effect being significant also indicates that the role of a digital leadership is not only confined to provide just a vision but also ensuring that active involvement is demonstrated in guiding SMEs through the process of adopting digital tools and strategies because the guidance would enable long-term sustainability. In this sense, for the transformation, digital leadership becomes a catalyst in the process by allowing SMEs to exhibit the full potential of digital technologies in order to maintain a competitive edge. This finding reinforces the growing recognition in the literature that digital transformation is essential for SMEs to adapt and thrive in the digital age. In other words, digital transformation is a critical enabler of sustainable growth.

On the other hand, the moderating role of leadership tenure on the relationship between digital leadership and digital transformation is found insignificant; thus, hypothesis 3 is not supported by this study. Interestingly, our present finding opposes to larger extent with the existing literature that argued that longer leadership tenure could have greater positive impact especially in understanding the organization and offer far greater stability in the process of decision-making, which facilitate the adoption of digital transformation [17, 21]. Basically, there is no role of leadership tenure to implement the digital transformation; studies show that the leadership ability is crucial to executing the digital transformation strategy into organizations rather than their long service [43]. In other words, this study can say that new and experienced leaders can implement digital transformation successfully without any hazards if they have digital leadership skills. Nonetheless, present findings show that the critical factor is digital competencies of a leader in successful implementation of strategies in the SMEs rather than the duration of a leadership. In addition to that, skills and ability to adapt to changing environment and changing technologies are also vital factor behind leader’s success in bringing change in the organization. adapt to technological changes. This conclusion is supported by research from Ulas [12], Koryak [16], Malik [19], and Yamoah & Haque [21], who found that digital leadership skills are more pivotal for effectively managing technological and strategic change.

13. Develop two separate sections for both theoretical and practical implications.

Response:

Thank you. We have now added it after conclusion. Please see page 14-15:

 

Theoretical Implications

The literature on digital leadership, digital transformation, and SME sustainability is expanding, and this research adds to it, especially when considering emerging nations like Malaysia.  A more sophisticated explanation of the relationship between digital leadership and SME sustainability is offered by this study, which incorporates leadership tenure as a moderating component and digital transformation as a mediating variable.  In contrast to other research that mostly focuses on major corporations, this study adds to the theoretical conversation by highlighting the function of digital leadership in settings with limited resources, including micro and small businesses.  The results cast doubt on the conventional wisdom that longevity in leadership is a determining factor in digital transformation, arguing that digital proficiency and adaptability are more important than tenure. Additionally, by showing that digital leadership improves company sustainability both directly and through digital transformation, this study adds to and validates ideas of technology adoption and leadership.  These results provide a theoretical framework for further research into the dynamics of leadership and digitalization in various sectors and geographical areas.

 

 

Practical Implications

For SME owners, managers, and legislators looking to improve corporate sustainability through digital leadership, this report offers useful insights.  The results highlight how entrepreneurs must actively embrace digital leadership techniques and use digital transformation tactics to be competitive in a market that is changing.  Because leadership tenure was determined to be negligible, SME owners, regardless of experience level, should prioritize learning digital skills above traditional leadership expertise.  Policymakers should develop programs to encourage digital upskilling, provide financial incentives for adopting new technologies, and provide frameworks that make it easier for SMEs to digitize. Furthermore, leadership training that encourages SME leaders' creativity, adaptability, and digital literacy must be given top priority in company growth initiatives.  This study also emphasizes the significance of having access to digital resources and infrastructure, which may help SMEs successfully adopt digital strategies and eventually support long-term sustainability and economic resilience in developing nations.

14.   Show the VIF and CMB.

Response:

Thank you. We have included now the VIF and CMB. Please see page 8-10 in a revised draft.

 

Once again thank you for your constructive feedback. We appreciate your time and efforts. 

Author Response File: Author Response.docx

Round 2

Reviewer 3 Report

Comments and Suggestions for Authors

satisfied