Digital Transformation and Firm Value: A Resource-Based View on Indonesian Non-Cyclical Consumer and Healthcare Listed Companies

Abstract

Technological change and economic uncertainty are challenging the ability of listed companies in the non-cyclical consumer and healthcare sectors to preserve their market value. According to the Resource-Based View (RBV) theory, digital transformation involves the automation of administrative tasks whilst also representing a strategic and dynamic capability capable of creating sustainable competitive advantage and supporting the achievement of better valuations from investors. This research analyzes the impact of digital transformation on firm value, particularly for non-cyclical consumer and healthcare listed companies on the Indonesia Stock Exchange (IDX) for the period 2015-2024. An analysis of 10 selected listed companies, as determined by purposive sampling, was conducted using multiple linear regression. The findings of this study indicate that internal digital investment and commitment play a significant role in enhancing a firm’s intangible assets, as reflected in a significant increase in the Tobin’s Q value. Theoretically, this study broadens the use of RBV theory in the context of digitalization within non-cyclical consumer and healthcare sectors of an emerging market. In practice, this study offers strategic direction to senior management on how to allocate funds for technology purchases in a way that builds a competitive edge which is hard for other companies to imitate.