Strengthening Creative Economy Capabilities in East Java through Digital Transformation and Networks

Abstract

Every creative industry is required to change business operations through sophisticated digital technology since the
4.0 industrial revolution which was accompanied by the Covid-19 pandemic attack which was crippling the East Java
economy. The purpose of this study is to determine how the effectiveness of digital transformation and networks in
reviving the economic capabilities of East Java. A total of 220 creative-preneurs samples were selected by simple
random sampling and were examined using an online questionnaire on a 5-point Likert scale. The collected
quantitative data were analyzed using Partial Least Square analysis. The results show that digital transformation is
very effective in strengthening the dynamic capabilities of creative industries in the digital era even though the
process is still not optimal because many industries are still constrained by budgetary funds and qualified human
resources in the IoT and Big Data fields. In this case, networks owned by creative industries can slightly balance the
shortcomings in digital transformation. The suggestion that can be given is that penta-helix collaboration be improved
so that the acceleration of digital transformation can be done. For further research, it can examine the main
shortcomings in the digital transformation process and specific problems in networks.
Keywords: Digital Transformation, Networks, Dynamic Capability, Creative Industry.