Enhancing enterprises` market competitiveness has consistently been an exploration subject because it is the winning magic weapon in a revival competitive environment. Existing literature focuses on the driving factors of internal management and improving the external business environment. In the digital technology megatrend, the swift advancement of contemporary information technology, including big data and the Internet, is significantly influencing the economies worldwide. Digital transformation has emerged as a pivotal catalyst for economic growth and is essential for improving businesses’ market competitiveness.

Digital transformation has become a pivotal catalyst for organizational change, with substantial literature underscoring its diverse effects on firm performance. Previous research has primarily focused on enhancing operational efficiency through the use of digital technologies. For instance, Lin & Zhang (2023) demonstrate that digitalization enables real-time data analytics and process automation, leading to reduced production costs and improved supply chain responsiveness. Cheng et al.(2024) assert that digital capabilities enable the incorporation of customer feedback into product development cycles, fostering accelerated innovation and increased market relevance. Davison et al.(2023)argues that digital transformation fosters open innovation models by dismantling organizational barriers, enabling firms to collaborate with external partners and utilize crowdsourcing platforms.

In contrast, Denicolai & Previtali (2023) emphasize the importance of digital ecosystems in accelerating technology commercialization by sharing resources and complementary capabilities. Fang & Liu (2024) assert that investments in digital infrastructure are associated with substantial productivity enhancements, especially in knowledge-intensive sectors. However, Pan & Xu (2024) caution that these advantages are not uniformly realized, as firms with digitally adept leadership often struggle to derive value from technological integration. Notwithstanding these advancements, current research on digital transformation and market competitiveness is fragmented: some scholars investigate the direct impacts of particular technologies (e.g., AI, blockchain) on competitive advantage (Leng & Zhang, 2024; Li et al., 2024), while others analyze macro-level factors such as industry digitization intensity (Wang & Shao, 2024;Li et al., 2022; Kao et al., 2024); however, few studies systematically incorporate the mediating role of executive characteristics in this relationship. Furthermore, existing literature frequently regards “digital transformation” as a singular entity, failing to acknowledge the subtle distinctions in the depth of transformation (e.g., operational versus strategic digitization) and disregarding the influence of executive attributes—such as technological proficiency, risk tolerance, and cognitive adaptability—on organizations’ capacity to convert digital investments into enduring competitive advantage. This oversight creates a significant research gap that this study seeks to fill by examining the interactive effects of digital transformation and executive characteristics on market performance.

This paper conducts a rigorous analysis to examine the relationship between the digital transition and enterprises` market competitiveness spanning 2011 to 2023. This paper makes two marginal contributes compared to existing literature. First, the literature has filled in the research gap on the influence of digital transformation on firms’ market competitiveness. The current literature predominantly investigates the effects of digital transformation on enterprise innovation (Chen et al., 2023), productivity (Khan et al., 2023), exports, labor division (Lin & Kim, 2021), and management (Davison et al., 2023). Yet, no studies address the holistic impact of digital transformation on micro-enterprises regarding market competitiveness. This work enriches the study of the economic implications of digital transformation. Second, this study emphasizes the significance of management characteristics in augmenting firms’ market competitiveness through digital technology, providing valuable insights for enterprises to establish well-performed management teams.

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