CLOUD COMPUTING ENABLED BUSINESS MODEL INNOVATION FOR RETAIL SMES: A DIFFUSION OF INNOVATION BASED SYSTEMATIC LITERATURE REVIEW

Abstract

Cloud computing has become a transformative driver of Business Model Innovation (BMI), yet its strategic role in retail small and medium-sized enterprises (SMEs) in developing economies remains underexplored. This study addresses this gap by applying the Diffusion of Innovation (DOI) theory to examine how cloud adoption enables BMI within Sri Lankan retail SMEs, a context characterised by infrastructural constraints, policy gaps, and varying managerial readiness. Through a systematic literature review of peer-reviewed studies, six enabling factors are identified: relative advantage, organisational readiness, cost, top management support, government support, and trialability. The study extends DOI theory by situating these adoption drivers within a developing-economy setting, highlighting how environmental and institutional factors reshape classical DOI attributes. Practically, the framework offers guidance for SME managers seeking digital transformation and for policymakers designing targeted incentives and infrastructure development to foster cloud-enabled innovation.