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This paper aims to analyze the factors that affect the attitudes of Armenian small and medium enterprises (SMEs) regarding digitalization, examining whether they view it as a tool to foster innovation and business growth, while also assessing the extent to which digitalization mitigated the negative impacts of the COVID-19 crisis.

The empirical approach is based on data collected from 452 Armenian SMEs, which were further analyzed using SPSS Statistics 23.0 software. Scales for assessing the COVID-19 impact, innovation and digitalization were constructed and validated. To test five hypotheses, binomial logistic regression was conducted to appraise the importance of digitalization for Armenian SMEs, including the ability to mitigate the consequences of the recent COVID-19 pandemic.

The results of the analysis showed that the economic sector plays a significant role in forming the expectations of firms on the positive impact of digitalization, while the company size does not affect them. This paper found that the provision of online services before the pandemic did not help Armenian SMEs to be less affected by the crisis. Furthermore, the perception of whether digitalization facilitated innovative processes, products and services did not depend on the degree of being affected by COVID-19. Finally, the findings indicate that the more agile companies which had the ability to convert their business model into an e-business model were less affected by the crisis.

This paper contributes to the literature by studying the effect of digitalization on SMEs, as well as how SMEs in small developing countries like Armenia mitigated the negative effects of the COVID-19 pandemic. The current work is unique as, to the best of the authors’ knowledge, there are no prior empirical studies focusing on impact of digitalization and innovation induced by exogenous shocks in an under-researched country like Armenia.

Innovation is considered as an important tool to succeed and survive in periods of great uncertainty such as COVID-19 crisis. This paper aims to empirically examine the propensity to engage in product, process and organizational innovation under uncertainty among small and medium enterprises and how that propensity varies depending on the gender of the manager.

Using the results of 213 responses by managers of Armenian small and medium enterprises in the scope of GLOBE-2020 survey, the authors investigate the role of manager’s gender in encouraging innovative attitude under uncertainty. To measure the relationship between uncertainty and innovation (product, process and organizational), Pearson’s correlation coefficients were calculated between managers’ perception about the uncertainty and their perceptions of innovation within their companies compared to the players in the external environment. In addition, a linear regression was run between the three innovation types and uncertainty.

The results of our analysis confirmed the positive relationship between uncertainty and innovation. Moreover, our results indicate that male managers have a higher tendency to undertake innovation under external turbulence.

This study fills the gap in the literature by studying the relationship between uncertainty and innovation, focusing on SMEs during adversarial times, which in contrast to bigger companies are limited in terms of their resources and, hence, capacity to innovate. The paper examines the gender dimension as an internal factor affecting innovation under uncertainty in an under-researched country context of Armenia, where female entrepreneurs deal with unique challenges to engage in innovative activities.