Digital Resilience Model of Local-Potential-Based MSMEs: The Role of Adaptive Capability and Competitive Intelligence in the Digital Village Ecosystem of Cirebon Regency, Indonesia

The acceleration of national digitalisation in Indonesia has not been matched by the digital resilience of rural micro, small, and medium enterprises (MSMEs), particularly those that rely on local potential. This study develops and validates a local-potential-based digital resilience model for MSMEs by integrating the Resource-Based View, Dynamic Capability Theory, and the Competitive Intelligence Framework within the digital village ecosystem of Cirebon Regency, West Java. A mixed-method sequential explanatory design was employed. The quantitative phase surveyed 200 local-potential-based MSMEs (culinary, crafts, agricultural products, fashion, and tourism) and analysed the data using PLS-SEM; the qualitative phase comprised three focus group discussions, ten in-depth interviews, and observation of five leading MSMEs; and the model was validated through a two-round Delphi with five experts. Results show that local potential positively influences adaptive capability (? = 0.621), competitive intelligence (? = 0.284), and digital resilience (? = 0.176); adaptive capability (? = 0.392) and competitive intelligence (? = 0.318) positively influence digital resilience; and both partially mediate the effect of local potential on digital resilience (VAF = 70.8%). The model explains 61.2% of the variance in digital resilience. Qualitative findings reveal five mechanisms: local narrative as digital capital, community-based incremental adaptation, informal competitive intelligence, dependence on digital pioneers and facilitators, and fragmentation of the digital village ecosystem. The expert panel confirmed model validity (S-CVI/Ave = 0.95). The study contributes theoretically by positioning local potential as a distinctive resource that must be converted into dynamic capabilities and market intelligence to generate resilience, and practically by offering an implementation toolkit and policy recommendations for digital village ecosystem development.