DIGITALIZATION AS A FACTOR OF STRUCTURAL TRANSFORMATION AND SUSTAINABLE DEVELOPMENT OF SMALL AND MEDIUM BUSINESSES IN UKRAINE

Abstract

The article examines the role of digitalization in the structural transformation and sustainable development of small and medium-sized enterprises in Ukraine under conditions of economic instability and wartime challenges. The relevance of the study is determined by the increasing importance of SMEs for maintaining economic resilience, employment, and business adaptability during structural changes in the national economy. At the same time, the growth of the SME sector is not accompanied by a proportional increase in productivity and value creation, which indicates the existence of internal structural imbalances and unequal technological development among different groups of enterprises. The purpose of the study is to substantiate the role of digitalization as a factor in increasing factor productivity, economic sustainability, and long-term competitiveness of SMEs. The methodological basis of the research includes structural, comparative, economic-statistical, and analytical methods, as well as methods of grouping and generalization. Their application made it possible to identify the relationship between the level of digital integration of enterprises, their resource capacity, and their contribution to value added creation. The results of the study show that digitalization increasingly acts as a systemic mechanism of business modernization rather than only a tool for automating individual operations. The implementation of cloud technologies, SaaS solutions, CRM and ERP systems contributes to the optimization of business processes, reduction of transaction costs, and strengthening of enterprise adaptability under unstable economic conditions. It was determined that medium-sized enterprises demonstrate significantly higher levels of productivity and digital integration, while many microenterprises remain limited in access to investment resources and technological modernization. The study also identifies the main barriers to digital transformation, including limited capitalization, shortage of digital competencies, labor losses, cyber security risks, and growing digital inequality. The practical significance of the study lies in the possibility of applying its results to the development of differentiated policies for SME digital modernization, support programs for micro- and small businesses, and strategies aimed at reducing technological inequality and strengthening the sustainable development of SMEs in Ukraine.