Business Model Innovation among Vietnamese SMEs in the Context of Digital Transformation

This paper examines business model innovation among Vietnamese small and medium-sized enterprises (SMEs) in the context of digital transformation. Although digital technologies create opportunities for SMEs to redesign value propositions, customer interfaces, operating architectures, partnership systems, and revenue mechanisms, many Vietnamese firms still approach digital transformation as an isolated technology-adoption project rather than a strategic renewal process. Drawing on the business model innovation literature, dynamic capability theory, resource-based theory, digital transformation studies, and recent policy evidence on Vietnam, the paper develops an integrated analytical framework explaining how digital transformation triggers, enables, and constrains business model innovation in SMEs. The study uses a conceptual and narrative review method combined with contextual policy analysis. Its main contribution is a multi-layer framework that links digital readiness, entrepreneurial orientation, sensing-seizing-reconfiguring capabilities, ecosystem participation, and institutional support to five forms of business model innovation: value proposition renewal, digital customer engagement, process and data-driven operations, platform-based collaboration, and revenue model redesign. The paper provides implications for SME owners, managers, digital-service providers, and policymakers seeking to move from basic digitization toward scalable and resilient digital business models.