Digital Transformation Driving Small, Medium and Micro Enterprises Integration into Corporate Supply Chain in South Africa

Abstract

Digital transformation is essential for economic development in Africa, offering significant opportunities to integrate Small, Medium, and Micro Enterprises (SMMEs) into corporate supply chains. In South Africa’s financial services and Information and Communications Technology (ICT) sectors, this integration is crucial for fostering inclusive growth. However, the limited digital transformation within Enterprise and Supplier Development (ESD) frameworks hinders meaningful progress in bridging the gap between large corporations and historically marginalized SMMEs. This study examined the role of digital transformation and Fourth Industrial Revolution (4IR) technologies in integrating South African SMMEs into corporate supply chains, focusing on the challenges, opportunities, and strategies for enhancing competitiveness and inclusive economic growth. A qualitative research approach was employed, using open-ended interviews with twelve senior managers across the banking, insurance, supply chain, SMME, and ICT sectors. Thematic analysis of the data revealed that digital tools such as Software as a Service (SaaS) and Business-to-Business (B2B) platforms are vital for improving SMME connectivity, streamlining operations, and supporting flexible supply chains. However, barriers such as inadequate internet access, low technological awareness, poor infrastructure, and resistance to change impede digital adoption. Conversely, cloud computing, social media, and data analytics were identified as tools for reducing costs, expanding market access, and building resilience. The study recommends that stakeholders invest in digital platforms, automation tools, and affordable internet infrastructure. Additionally, targeted training programs and strategic partnerships should support SMME adoption of digital technologies. Collaborative initiatives must also drive policy reform and capacity building to ensure inclusive digital integration and sustainable economic growth.