The interplay of IT adoption, government support and firm performance: mediating roles of innovation and resilience in Vietnamese SMEs

Purpose: Amid growing competition and global disruptions, organizational resilience and innovation are essential for a firm’s survival and success. This study aims to examine the impact of information technology (IT) adoption and government support on firm performance, with a focus on the mediating roles of innovation and resilience in the Vietnamese context. Design/methodology/approach: This study emphasizes the importance of IT as a vital resource for fostering innovation and resilience while highlighting the essential role of government policies in enabling digital transformation and enhancing firm performance. A cross-sectional data set of 321 small- and medium-sized enterprises (SMEs) from southern Vietnam was analyzed using partial least squares structural equation modeling. Findings: The empirical results indicate that innovation and resilience have a positive impact on firm performance. Furthermore, IT adoption indirectly impacts firm performance by driving innovation and resilience. The study also highlights that government support for digital transformation plays a significant role in creating an enabling environment for innovation and safeguarding firms amid today’s volatile business landscape. Research limitations/implications: The findings highlight that innovation and resilience are crucial for a firm’s success when leaders effectively leverage IT and government support. Focusing on managers’ perspectives, the study is particularly relevant for unlisted companies and SMEs, emphasizing how IT adoption and government support enhance innovation and resilience to drive performance in volatile environments. Future research could include financial data, explore long-term effects and investigate additional factors that influence the outcome. Originality/value: By adopting the dynamic capabilities view, this study aims to explore how firms can integrate internal resources, such as IT adoption, with external enablers, including government support, to enhance their innovation and resilience. This integration is intended not only to drive firm performance but also to strengthen competitive advantage in an increasingly volatile and digitally driven business environment. The research framework emphasizes the interconnected roles of IT, innovation, resilience and government policies, offering a comprehensive perspective on how firms adapt and thrive in the face of challenges. Future implications include guiding policymakers in designing effective support mechanisms and helping businesses align internal strategies with external opportunities to sustain growth.