The Role of Digital Transformation in Enhancing Employee Competencies: A CMMI-Mediated Approach Towards Sustainable Organizational Development

Abstract

This study investigates the impact of Digital Transformation (DT) on Employee Competencies, focusing on the mediating role of Capability Maturity Model Integration (CMMI). It examines how digital platforms, data media, and automation contribute to the enhancement of employee competencies while promoting sustainability in organizational growth. A quantitative survey was conducted with 150 small and medium-sized enterprises (SMEs) in Xi'an, Shanxi Province, using 300 structured questionnaires, yielding 265 valid responses. Data were analyzed through Smart PLS-SEM to ensure the reliability and validity of the models and to test the hypotheses. The results confirmed strong reliability and validity, with composite reliability, factor loadings, Cronbach's α, and average variance extracted (AVE) meeting statistical requirements. Structural model analysis supported all hypotheses, revealing that digital transformation components—digital platforms, digital data, digital media, and automation—positively impacted Employee Competencies, either directly or through CMMI's mediating effect. Furthermore, CMMI integration enhanced the organization’s ability to achieve sustainable development by fostering continuous improvement in employee capabilities. This study contributes to Digital Transformation research by emphasizing CMMI's role in the DT-Employee Competency relationship and offers practical insights on leveraging digital technologies and process maturity models to achieve sustainability through workforce development.