IT-Enabled Organisational Transformation and Green Employment Growth in Microfirms

Abstract

In this paper, we explore whether IT-enabled organisational transformation (ITOT) moderates the relationship between eco-innovation and the growth performance of microfirms. Our framework conceptualises ITOT in microfirms as a multistage process that includes: (i) setting a digitalisation strategy, (ii) adopting advanced information systems technology (IST) artefacts and (iii) developing in-house digital resources and capabilities. The analysis of a sample of 5015 microfirms from 39 countries indicates that eco-innovations boost firm growth when coupled with (i) a formalised digitalisation strategy, (ii) adoption of advanced IST artefacts (e.g., digital technologies that characterise Industry 4.0) and (iii) digital resources and capabilities in microfirms. These findings contribute to the growing digitalisation literature by highlighting the essential role that ITOT processes play in enabling sustainability-led growth pathways for microfirms. The paper advocates for the viability and performance benefits of a twin digital and ecological transformation and showcases the potential of ITOT for an economically successful net-zero transition that embraces microfirms.