Digital capabilities and market competitiveness: the two-fold mediation of internal and external drivers

Abstract

Purpose

This study evaluates the two-way relationship between digital capabilities and market competitiveness along with the twofold mediation of circular economy, business model innovation (BMI) and energy policies based on the dynamic capability and ecological modernization theories.

Design/methodology/approach

Data were compiled through questionnaire-based survey from the top management of new ventures and evaluated through partial least squares structural equation modeling to find results.

Findings

The study discovered a two-way relationship between digital capabilities and market competitiveness among new ventures along with the twofold mediation of circular economy and BMI. Surprisingly, the energy policies have no twofold mediation.

Practical implications

The findings have important implications for policy and guide the practitioners to focus on digital efficiencies to attain higher competitive advantage in the light of environmental initiatives.

Originality/value

Although past research has paid wide attention to the defined factors, but to the best of the author’s knowledge, this is the first study in these domains.

Citation

Rehman, F.U. (2024), "Digital capabilities and market competitiveness: the two-fold mediation of internal and external drivers", European Business Review, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/EBR-02-2024-0088