How Digitalization in SMEs Drives Economies of Scale Benefits

This report investigates the impact of digitalization on Small and Medium Enterprises (SMEs), focusing on how it drives benefits of economies of scale and maximizes performance. The study aims to determine how digitalization enhances sales and overall performance within SMEs, using Wallawwa Hotel in Sri Lanka as a case study. It explores the concept of digitalization, analyzes its benefits, and identifies specific advantages related to sales and operational efficiency. The research employs a literature review, theoretical framework, and research methodology that includes both primary and secondary data collection through questionnaires and online sources. The report highlights the significance of digitalization in improving business outcomes and provides insights for both researchers and practitioners in the field, emphasizing the role of digital technologies in boosting profitability and productivity within SMEs. The report also discusses the theoretical framework, research design, methodology, and significance of the research, supported by relevant references.

How Digitalization in SMEs Drive
Benefits of Economies of Scale and
Maximize Performance

TABLE OF CONTENTS
INTRODUCTION & RESEARCH QUESTIONS..........................................................................1
LITERATURE REVIEW................................................................................................................1
THEORETICAL FRAMEWORK...................................................................................................2
RESEARCH DESIGN AND METHODOLOGY...........................................................................4
SIGNIFICANCE OF RESEARCH..................................................................................................4
REFERENCES................................................................................................................................6

INTRODUCTION & RESEARCH QUESTIONS
There are many changes that have taken place in relation with technology and companies
make use of it so that they are able to deliver high quality services to customers. As per the
current research, it is focused on digitalization. There are different organizations that have made
use of these with a purpose of raising the sales and profitability. To carry out the a well-known
SME business operating in the hotel industry of Sri Lanka named Wallawwa is taken into
consideration where they have been found to have an intent of delivering high quality products
and services to their users. Below given are the aim, objectives and research questions:
Aim: To determine the benefits of sales and maximization of performance in SMEs for economy
SMEs through digitalization: A study on Wallawwa Hotel, Sri Lanka.
Research Objectives
 To understand the concept of digitalization
 To analyse the benefits that company gets through digitalization
 To identify the benefits those are attained for economy of sales by implementing
digitalization by Wallawwa Hotel, Sri Lanka.
Research Questions
 What is the concept of digitalization?
 What are the benefits that company gets through digitalization?
 What are the benefits that are attained for economy of sales by implementing
digitalization by Wallawwa Hotel, Sri Lanka?
LITERATURE REVIEW
As per Jeschke and et.al., 2017, SMEs and comparative associations are receiving as well
as using new advance technologies in the business. This is with assistance of their capacities to
expand the adequacy and proficiency that duly prompts change in business execution. The small
medium businesses are utilising digital technologies to promote and trade their products or
services effectively which are successfully improving their performance. New and imaginative
innovations are getting presented in the business condition. The Digitalisation is a noteworthy
component that is influencing working conduct and elements of associations. Advanced
innovation is in charge of productive and viable work inside the associations. For example: the
SMEs.
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Jousse and et.al., 2017 state that individuals are profoundly affected by the developing
innovations in present world. Billions of individuals have started utilizing advanced technologies
such as smart-phones in their everyday exercises. The general population is additionally utilizing
different kinds of advances, for example, internet of things (IOT), online application, delicate
products and so forth. Again, there are few issues that emerge in actualizing the innovations in
business. Waldfogel, 2017 expresses that the issues developed in the execution of cutting edge
advancement in advancing limit are a result of non-attendance of learning and aptitudes in the
zone of computerized innovation. The research and factual examination likewise demonstrated
that selection and ramifications of advanced technologies in the business activities are
expanding. These progresses are directly impacting upon each associated aspects to utilize new
innovations in the business in accordance to their aptitudes.
Additionally, the Digitalisation has turned into an imperative piece of each individual's
life. The SMEs use new and inventive advancements in their business capacities to accomplish
productivity and viability as well as accomplish the set hierarchical objectives or destinations.
The Digitalisation is a successful part which profoundly influences the business elements of
SMEs decidedly. Various independent companies are not prepared to grasp new advances due to
specific limits, absence of information and securities of data in progressing advancements.
Several small and medium sized enterprises are facing inconvenience in grasping progressive
measures of advancement within their limits of sponsoring due to lack of secure database and
incapable employees.
THEORETICAL FRAMEWORK
The Digital marketing is a wide concept which is useful for SMEs in improving the
performance and profitability. This is done using the concepts of digitalization where new digital
technicalities are being referred to change an adopted business model. It is with another foremost
intent of getting newer opportunities of generating revenue with scope of creating value. This
way, a business also tends to move in the world of digitalization. According to the above
literature review, it can be identified that there are various theories which are applied for the
analysis of digitalisation and its impact on various small and medium sized enterprises. There are
various theories like marketing strategy, relationship with suppliers, branding, profit and
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performance as well as the strategies of digital marketing which are applied by researchers or
organisations in analysing the impact and importance of digitalisation.
To envision the utilization of hypothetical structure and link between distinctive
hypothetical ideas, the above illustration shows conceptualisation of speculations to give an
encompassing review of a hypothetical system (Neubauer and et.al, 2017). The promoting
procedure defines an exercise that should assist the organization to achieve their set objectives
and targets with assistance of advertising exercises. The hypothesis notices three essential parts
for organizations; benefit/execution, connections and marking that can be improved with a
correct use of showcasing procedure. These three goals influence each other and are
exceptionally critical for organizations.
Illustration portrays marketing system associated with three targets of benefit or
execution, connections and marking which thus are associated and can be fortified by the
utilization of advanced advertising procedure. Likelihood of improved execution in all goals is
achievable with the utilization of computerized promoting. Advanced promoting could be
utilized to supplement the customary channels to better make progress in achieving distinctive
goals. Decisions of how to utilize advanced showcasing and the reason why it is utilized are the
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Illustration 1: Conceptualization of theoretical framework

exploration points for this investigation and the model will develop with new discoveries
(Nansen and et.al., 2017).
RESEARCH DESIGN AND METHODOLOGY
Different types of research methodologies are included which are effective enough to
make sure that research is carried out in an effective manner (Wickramasinghe, Dissanayake and
Somathilake, 2018). In this respect, research approach is an important aspect that enables
researcher to present the findings. In order to do so, use of inductive approach will be done as it
helps to provide specific details and general aspects are covered. In order to gather information,
it is required to make sure that appropriate sources are used that will be helpful enough to gather
adequate information. In this context, it includes primary and secondary information. Both have
their own set of benefits and disadvantages (Taylor, Bogdan and DeVault, 2015). To conduct the
research in effective manner, researcher will make use of both primary and secondary method.
More specifically, primary will be gathered with the help of questionnaire and secondary
through books, journals, online sources, etc. When information is gathered, then it is required to
make analysis and in order to do so, one needs to make sure that selection of appropriate method
is done. It includes qualitative and quantitative method. Among these, the research will make use
of qualitative method. More specifically, use of thematic will be done as it enables to present
information in the form of tables, charts and graphs. In order to carry out research in an
appropriate manner, it is important that selection of samples is done in a proper way (Brinkmann,
2014). For conducting the research, employees of Wallawwa hotel will be taken into
consideration as they are the one who have adequate knowledge regarding the research topic.
Proper system is needed to be used for gathering personal information that will be accessible to
the person who is authorised.
SIGNIFICANCE OF RESEARCH
This research study will aid in enhancing the level of knowledge and comprehension
skills of researcher. The research study will be significant for both readers and academician who
are pursuing this course of digital technologies. Digital technologies play a prominent role in
enhancing organization’s profitability and productivity. In this context, this research study will
help the management of Wallawwa Hotel by providing them some of the best strategies that can
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be used in digital technology through which their sales and profitability can be raised.
Eventually, through this research, other researchers and authors can underpin their study by
including topics and concepts of study on digital technology. Through this, viewers will be able
to determine the benefits that companies get when making use of digital technology.
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REFERENCES
Books and Journals
Brinkmann, S., 2014. Interview. In Encyclopedia of critical psychology (pp. 1008-1010).
Springer New York.
Jeschke, S. and et.al., 2017. Industrial internet of things and cyber manufacturing systems.
In Industrial Internet of Things (pp. 3-19). Springer, Cham.
Jousse, J. and et.al., 2017. Power line communication management of battery energy storage in a
small-scale autonomous photovoltaic system. IEEE Transactions on Smart Grid, 8(5),
pp.2129-2137.
Nansen, B. and et.al., 2017. Social media in the funeral industry: On the digitization of
grief. Journal of Broadcasting & Electronic Media, 61(1), pp.73-89.
Neubauer, P., Glauche, F. and Cruz‐Bournazou, M.N., 2017. Bioprocess Development in the era
of digitalization. Engineering in Life Sciences, 17(11), pp.1140-1141.
Taylor, S. J., Bogdan, R. and DeVault, M., 2015. Introduction to qualitative research methods: A
guidebook and resource. John Wiley & Sons.
Waldfogel, J., 2017. How Digitization Has Created a Golden Age of Music, Movies, Books, and
Television. Journal of Economic Perspectives, 31(3), pp.195-214.
Wickramasinghe, M., Dissanayake, S. and Somathilake, D. N., 2018. How to Impact Information
System Increase Efficiency of Small Business in Sri Lankan Rural City Areas. John Wiley
& Sons.
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