Digital Orientation of Small Enterprises: An Indian Perspective

The digital transformation of small enterprises isessential for enhancing competitiveness and fostering scalablegrowth in India’s manufacturing sector. This study focuses onidentifying and analyzing the critical enablers to overcome thedigital orientation challenges among small enterprises, with aspecific focus on automobile clusters in West Bengal andJharkhand. Data was collected from the Ministry of CorporateAffairs (MCA) government portal and processed to extract keyoperational and digital transformation metrics. Using the SHAP(SHapley Additive exPlanations) method, we identified the mostinfluential features impacting digital adoption. The key enablersinclude a digitally skilled workforce, enhanced market access,robust product standardization processes, certification test labcollaboration, Knowledge of digital tools and technologies tominimize technology transfer challenges and seamlessly integratediverse business processes through affordable solutions. Thesefeatures were then examined using a multiple regression model toassess their relationship with revenue growth and costoptimization. The results demonstrate a strong positivecorrelation, highlighting the impact of digital orientation onperformance and scalability. To validate the research outcomes,we collected data from a set of companies, implementedincremental steps for small-scale digital transformation activities,and observed their impact on cost-effectiveness and revenuegrowth over two years. This research offers actionable insights forpolicymakers and business leaders aiming to accelerate digitaladoption among Indian small enterprises..