Effect of Common Facility Centre (CFC) Support Program on SMEs’ Digital Transformation: Mediating Role of Firm Sensing Capability

Abstract

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Despite the growing interest of policymakers and scholars in SMEs’ support programs, theoretical information concerning how support programs contribute to SMEs' digital transformation remains scarce in the existing literature. Building on the dynamic capability theory, this study aims to investigate the role of the Common Facility Centre (CFC) support program in SMEs' digital transformation through the mediating mechanism of firm sensing capability. Multi-time and multi-source data were collected from 230 SMEs through a self-administered survey questionnaire. The findings indicate that the use of the CFC support program has a positive effect on SMEs’ digital capability and digital adaptation (two dimensions of digital transformation). However, the variable firm sensing capability does not mediate the relationship between CFC program usage and firms’ digital transformation.