The Effect of Digital Capability on Competitiveness through Digital Innovation of E-Travel Business in Indonesia

Abstract

The growth of the internet in the world globally, including Indonesia, has had a significant impact on digital business and also digital media. In the era of Industry Revolution, 4.0, which is shown by automatization or also known as the Internet of Things, has had a significant impact on economic growth and, of course, every industry of businesses including e-travel business. This research uses associative research with a quantitative approach. The data sources used in this study are primary data sources in the form of information from the parties concerned and secondary data in books, journals, and government reports. Data collection techniques used were questionnaires, interviews, and documents. Datasets taken in this study were 125 of E-travel business companies in DKI Jakarta Province (Indonesia), which are using electronics or technology in their business operations. Data were taken at the end of the year 2019 using purposive sampling and use Path Analysis with Smart PLS 3.0 as a statistic tool. There are four hypotheses with three variables in this research: Digital Capability, Competitiveness, and Digital Innovation. The results of this study indicate that Digital Capability through digital innovation has a significant effect on Competitiveness. The study objective is determining the effect of Digital Capability on Competitiveness through Digital Innovation in e-travel business in Indonesia due to facing Industry Revolution 4.0.