The Impact of Digitalization Strategy Adoption and Digital Transformation on Sustainable Business Performance: The Roles of Market-Driven Busines Model Innovation and Digital Leadership Capabilities in Indonesia

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Saratoga, Esha Etlin (2026) The Impact of Digitalization Strategy Adoption and Digital Transformation on Sustainable Business Performance: The Roles of Market-Driven Busines Model Innovation and Digital Leadership Capabilities in Indonesia. Masters thesis, IPMI Institute.

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Abstract

Digitalization strategy adoption and digital transformation have become strategic priorities for organizations seeking to improve sustainable business performance. However, limited research explains how digital initiatives translate into sustainable outcomes through market-driven business model innovation and digital leadership capabilities, particularly in Indonesian publicly listed companies, state-owned enterprises, and their subsidiaries. This study examines the effects of Digitalization Strategy Adoption (DSA), Digital Transformation (DT), Market-Driven Business Model Innovation (MDBMI), and Digital Leadership Capabilities (DLC) on Sustainable Business Performance (SBP), using data from 316 valid respondents and analyzing the model through Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings show that DSA, DT, MDBMI, and DLC directly contribute to SBP, while DSA and DT do not significantly influence MDBMI, and MDBMI does not mediate the relationships between DSA, DT, and SBP. In addition, DLC has a positive direct effect on SBP but a significant negative moderating effect on the MDBMI - SBP relationship, suggesting a possible substitution effect that may be explained through situational leadership, team readiness, delegation, and leadership driven execution. Overall, this study contributes to the digital transformation and sustainability literature by identifying an organizational silo phenomenon, where digital strategy, digital transformation, business model innovation, and digital leadership contribute to sustainable performance through separate pathways rather than as one fully integrated capability system.

Keywords: Digitalization Strategy Adoption; Digital Transformation; Market-Driven Business Model Innovation; Digital Leadership Capabilities; Sustainable Business Performance

Item Type: Thesis (Masters)
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Thesis > Master of Business Administration
Depositing User: sandra margaretha
Date Deposited: 28 Sep 2026 02:34
Last Modified: 28 Sep 2026 02:34
URI: http://repository.ipmi.ac.id/id/eprint/3032

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