Business Transformation in a Distinctive Institutional Setting: A Study of Regional Development Banks in Indonesia

Audy Thuda (), Mohammad Hamsal, Dezie Leonarda Warganegara and Pantri Heriyati
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Audy Thuda: Management Department, BINUS Business School Doctor of Research in Management, Bina Nusantara University, Jakarta 11480, Indonesia
Mohammad Hamsal: Management Department, BINUS Business School Doctor of Research in Management, Bina Nusantara University, Jakarta 11480, Indonesia
Dezie Leonarda Warganegara: Management Department, BINUS Business School Doctor of Research in Management, Bina Nusantara University, Jakarta 11480, Indonesia
Pantri Heriyati: Management Department, BINUS Business School Doctor of Research in Management, Bina Nusantara University, Jakarta 11480, Indonesia

Administrative Sciences, 2024, vol. 14, issue 11, 1-27

Abstract: Limited research exists on business transformation strategy within the Indonesian banking sector, particularly regarding regional development banks, which play a crucial role in regional economic advancement. This study investigates the drivers of successful business transformation in Indonesian RDBs and their impact on organizational performance, examining the moderating role of regional government intervention. Employing structural equation modeling, the study analyzed data from 255 branch managers across 27 RDBs. Results reveal that talent development, transformational leadership, and digital adoption significantly drive successful business transformation, which in turn enhances organizational performance. Contrary to expectations, regional government intervention did not demonstrate a moderating effect. This study provides valuable insights for RDB managers and policymakers, emphasizing the imporace of talent development, leadership, and digital adoption as key pillars of successful transformation and highlighting the need for a nuanced understanding of institutional influences within this sector.

Keywords: business transformation strategy; digital adoption; government intervention; transformational leadership; talent development (search for similar items in EconPapers)
JEL-codes: L M M0 M1 M10 M11 M12 M14 M15 M16 (search for similar items in EconPapers)
Date: 2024
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