Wang, K.; Xu, X.; Mao, P.; Deng, X. and Cao, D. (2026) Digital transformation and organizational readiness: Evidence from Chinese construction SMEs with a dynamic managerial capabilities lens. Engineering, Construction and Architectural Management, 33(7), pp. 5783-5819. ISSN 0969-9988
Abstract
Purpose – In the digital economy, the adoption and implementation of digital transformation (DX) is essential for small and medium-sized enterprises (SMEs) in the construction industry to secure a competitive advantage and achieve sustainability. This study examines the dynamic managerial capabilities of SME leaders and the organizational readiness required to facilitate DX. Design/methodology/approach – Drawing on insights from 33 managers across six SMEs, the study identifies key dynamic capabilities, organizational readiness factors, and transformation challenges. The framework was further refined and validated through a Delphi process, resulting in a four-layer model that links internal capabilities to specific DX challenges and provides a structured roadmap for SME transformation. Findings – Our findings reveal that DX in construction SMEs is driven by five dynamic capabilities: environmental sensing, strategic agility, resource mobilization, digital ecosystem building and organizational learning. In addition, organizational readiness serves as a critical enabler, shaped by leadership and cultural readiness, policy and stakeholder alignment and technological preparedness. Building on these insights, we propose a four-layer integrative framework that links these capabilities and readiness factors to specific internal and external challenges, providing a structured pathway for overcoming barriers and facilitating effective DX in construction SMEs. Originality/value – This study provides actionable insights by clarifying how construction SMEs strategically organize and leverage DX-related resources and capabilities to drive change and maintain a competitive edge. It contributes to theory by introducing an integrative framework that illuminates the interrelationships among these resources, managerial competencies and readiness factors, offering a detailed roadmap for implementing and sustaining DX.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | digital transformation; dynamic capabilities; enterprise innovation; implementation framework; readiness; SMEs |
| Index terms: | transformation, methodology, drawing, competitive advantage, evidence, manager, dynamic capability, implementation, organizational learning, construction industry, environmental sensing |
| Subjects: | evaluation and assessment methods, research methods, industry analysis, management, contractual arrangements, technical documentation, market analysis, business, environmental science, professional development, practitioner |
| Topics: | Procurement, Business Strategy, Sustainability, Design Practice, Roles and Professions, Information Management, Research Practice |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here