Assessing the digital transformation efficiency of agribusiness firms: A case study in the South-Western zone of Tamil Nadu

The rapid pace of digitalization has transformed industries and consumer behaviour worldwide, prompting businesses to accelerate their digital transformation efforts. This study aimed to assess the efficiency of agribusiness firms in achieving digital transformation within the South-Western Zone of Tamil Nadu. Data were collected from 41 agribusiness firms and analysed using Data Envelopment analysis (DEA), a method for evaluating the efficiency of decision-making units (DMUs). The results showed that ten DMUs involved in the processing and value addition of millets and firms selling organic products, were efficient, accounting for 24% of the total agribusiness firms. The major cause of inefficiency was the decline in pure technical efficiency and the market's steadily declining returns to scale. Hence, firms must closely track their resource and scale allocations, manage their internal operations and modify their output in response to market conditions to avoid a decline in their technical efficiency. The export potential of processed foods is projected to increase by 35% during 2027-28. The export potential of processed foods is projected to increase by 35% during 2027-28. Therefore, the growth of agribusiness enterprises, especially food processing firms, provides increased value and employment opportunities. Firms should prioritize investments in recruiting a digitally skilled workforce and dedicate training hours to ensure the effective use of advanced digital technologies, thereby enhancing efficiency. Firms should prioritize investments in recruiting a digitally skilled workforce and dedicate training hours to ensure the effective use of advanced digital technologies, thereby enhancing efficiency.