The relationship between digital transformation, financial support, and innovation in higher education institutions: Evidence from Peruvian universities

Both public and private institutions have been affected by the impact of the pandemic. This situation has pushed these institutions to move to a virtual environment where multiple digital tools have been developed to improve the performance of teaching and administrative staff. However, not all institutions have the same resources and support to successfully engage in these projects. This study aims to determine whether financial viability and support influence the digital transformation process in universities, and whether the latter impacts on their innovation capacity. To empirically verify these relationships, this study collected data from 24 Peruvian universities through an online survey. Data were analyzed with a principal component analysis (PCA) technique to generate a digital transformation index. The results showed that financial viability and support have a positive impact on universities’ digital transformation index, and that this index further impacts positively on universities’ innovation levels. Both theoretical and practical implications are discussed.