Digital Ecosystems and Redefining the Nature of Small - and Medium - Sized Enterprises

This paper examines the transformation of small- and medium-sized enterprises (SMEs) in the context of digital transformation, with particular emphasis on the emergence and expansion of digital ecosystems. Over the past two decades, the increasing diffusion of digital technologies and platform-based business models has generated profound structural changes in the organization of firms and in the mechanisms coordinating economic activity. While the literature has extensively addressed digital transformation and platform economies, less attention has been paid to the manner in which digital ecosystems redefine the nature and internal architecture of businesses. The study builds on institutional, evolutionary and organizational economics and aims to clarify how digital ecosystems modify the external environment of SMEs, and induce adjustments in their operational functions and management practices. The central research question investigates how participation in digital ecosystems reshapes firm boundaries, governance mechanisms, and long-term viability for SMEs. Methodologically, the paper adopts a conceptual and analytical approach based on the structured synthesis of the relevant academic literature and comparative institutional analysis. The findings indicate that digital ecosystems generate significant development opportunities for SMEs through enhanced connectivity, learning effects and access to markets, while simultaneously intensifying dependency risks and asymmetries in the bargaining power when faced with dominant platform actors. dominant platform actors. The paper is a contribution to the literature, and theory by offering an integrated analytical framework thereby linking the digital ecosystems with SME organizational transformation, and by outlining implications for managers, large firms and public authorities concerned with the sustainable digital development of SMEs.