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Abstract
The objective of this study is to investigate the effect of digital transformation on employee
performance in commercial banks of Butwal Sub-metropolitan City. Data was gathered from 286
employees of these banks using a convenience sampling method, employing a self-administered
questionnaire based on a five-point Likert scale. The research utilized descriptive and explanatory
research design, incorporating correlation and regression analyses. The findings indicate that all
five independent variables-Digital Leadership, Employee Digital Skill, Data-Driven Decision
Making, Technology Integration, and Organizational Culture-have a statistically significant and
positive effect on employee performance. Among these, Digital Leadership is identified as the most
influential predictor, suggesting that strong leadership in digital initiatives enhances employee
output and engagement. Employee Digital Skill follows closely, indicating that digitally proficient
employees perform better in technology-driven environments. Data-Driven Decision Making also
plays a vital role by enabling more informed and effective actions. While Technology Integration
and Organizational Culture show relatively smaller impacts, their contributions remain
significant in fostering a productive work environment. It can be concluded that enhancing digital
leadership, improving employee digital skills, and promoting data-informed practices are crucial
strategies for boosting employee performance. Additionally, cultivating a supportive organization
strengthens and ensuring effective technology integration further strengthens overall
organizational outcomes.
Keywords: Digital Leadership, Employee Digital Skill, Data-Driven Decision Making,
Technology Integration, and Organizational Culture