The digital transformation has revolutionized entire sectors in
recent years. Yet, SMEs struggle to successfully implement such
profound organizational transformations, endangering their
competitiveness in the long term. Scholars study internal,
company-related factors almost exclusively, whereas external
factors are sparsely considered. Therefore, this thesis applies the
PESTE framework to investigate external factors affecting the
digital transformation of Portuguese SMEs. The following
section explores technological factors (knowledge transfer and
digital infrastructure and connectivity) in Portugal, analyzing the
external environment on SMEs' digital transformation. Based on
these findings, recommendations were developed, including
interdisciplinary data collection processes, innovation hubs,
tailored training, and trust seal
