Digital Capabilities and Business Performance: A Systematic Literature Review

The purpose of this paper is to enhance understanding of digital capabilities (DC) by examining various attributes and integrating findings from previous studies on the impact of DC on business performance (BP) using the balanced scorecard approach. This study employs qualitative methodologies to systematically review the literature, focusing on 131 studies from the Scopus database, categorizing research gaps, DC attributes, and the influence of DC on BP, and presenting these findings as a consolidated categorization alongside a future direction framework. The findings indicate that DC significantly impacts internal processes (BP2), enhancing firms’ ability to integrate value chains, improve efficiency, and add cost competitiveness to innovation. This influence on BP2 also interrelates with financial performance (BP1), where internal efficiency benefits economic outcomes. However, gaps exist in understanding DC’s effect on customer-related aspects, and findings vary across firm types, industries, and countries. The study identifies three key DC attributes: digital technology, digital agility, and digital marketing capabilities. To the author’s knowledge, this study is the first comprehensive evaluation of DC attributes relevant at the business level, providing a criterion-based view of DC’s impact on BP and contributing to broader research on business strategies.