Digital Transformation and Adaptive Capacity of Banks in Tanzania: The Mediating effect of knowledge sharing

Authors

• Sospeter Muchunguzi, Eastern Africa Statistical Training CentreFollow
• Ulingeta O. L. Mbamba, University of Dar es SalaamFollow
• Victor G. Wilson, University of Dar es SalaamFollow

Abstract

Amid rising competition and uncertainty, banks are increasingly adopting digital technologies to sustain adaptive capacity and competitiveness. This study examines the mediating effect of knowledge sharing in the influence of digital transformation on adaptive capacity. Drawing on an integrative theoretical framework combining the Dynamic Capability Theory, the Affordance Theory and the Adaptive Structuration Theory, a deductive approach was used, involving a sample size of forty-three (43) banks in Tanzania. Data were collected using a questionnaire administered through a drop-off and pick-up-later method and analyzed with PLS-SEM using SmartPLS software. We found that digital transformation of customer touchpoints makes banks more adaptable both directly and by encouraging knowledge sharing, while digital transformation of operational processes also helps but can lose some benefits if knowledge sharing is weak. Investments in data analytics only improve adaptability when insights are shared across the organization. In short, knowledge sharing acts as a bridge that turns digital initiatives into real flexibility. For managers, this means technology alone is not enough by itself, the strong knowledge-sharing practices are essential. This research adds to the understanding of digital transformation and firm adaptive capacity and offers practical guidance for banks and policymakers.

Recommended Citation

Muchunguzi, Sospeter; Mbamba, Ulingeta O. L.; and Wilson, Victor G. (2026) "Digital Transformation and Adaptive Capacity of Banks in Tanzania: The Mediating effect of knowledge sharing," Business Management Review: Vol. 29: No. 1, Article 6.
Available at: https://doi.org/10.65085/2546-213x.1019