Increasing Digital Transformation Readiness in Small and Medium Apparel Enterprises Through Maturity Model Evaluation

Abstract

Small and Medium Enterprises (SMEs) play a pivotal role in the Indonesian economy, contributing significantly to Gross Domestic Product (GDP) and employment. However, the COVID-19 pandemic has diminished SMEs' GDP contribution. Digital transformation emerges as a crucial solution amidst these challenges. While many SMEs have adopted digitalization, they face obstacles such as product marketing, access to capital, raw material supplies, and effective application of digital technologies. Nevertheless, digitalization presents opportunities to enhance efficiency and expand global market access via the Internet in Indonesia. This study utilizes the Analytic Hierarchy Process (AHP) to formulate a digital transformation strategy, focusing specifically on optimizing internal business processes within apparel SMEs. Key findings from the AHP analysis highlight the critical importance of integrated production management systems, document scanning and digitization, customer data analysis, and basic digital skills training. These findings underpin strategic recommendations aimed at enhancing efficiency, productivity, and adaptability through technology adoption, employee training, and organizational restructuring. The strategy outlines short-term (6-12 months) and long-term (5 years) goals to guide SMEs toward achieving advanced digital transformation maturity. By prioritizing internal business processes, these initiatives aim to propel SMEs in the apparel sector towards greater success in the digital era.