This paper investigates the relationship between small and medium-sized enterprise (SME) agility and digitalization in optimizing sustainable business performance. The study aims to explore how SME agility influences the digitalization process and its impact on sustainable business performance. A quantitative methods approach is utilized employing data analysis and surveying a sample of SMEs from Malaysia. The purpose of this study is to reveal the relationship between SME agility and digitalization, and leading to sustainable business performance. The study identifies key enablers of SME agility, such as customer agility, operational agility, and partnering agility emphasizing the importance of strategic alignment between agility and digitalization initiatives to achieve sustainable business performance. This research contributes to the existing literature by highlighting the crucial role of SME agility in the context of digitalization and sustainable business performance. The findings offer practical implications for SMEs seeking to enhance their agility and digital capabilities, enabling them to navigate the challenges and opportunities presented by sustainability and digital transformation. Policymakers and industry stakeholders can utilize these insights to develop supportive frameworks and initiatives that promote agile digitalization practices in SMEs, fostering their sustainable growth in a dynamic business environment.
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