Abstract:From the perspective of designing incentive mechanism, this paper pays attention to the external support and cooperation of service providers, integrates the government, service providers and small and medium-sized enterprises(SMEs) into the same framework, and analyzes the strategies to promote the digital transformation of SMEs. The government is set to implement incentive mechanism, subsidy mechanism and punishment mechanism for SMEs and service providers, respectively. By using evolutionary game method, the government, service providers and SMEs are regarded as the main participants in the digital transformation system to construct the three evolutionary game models. The mechanism and effect of government and service providers’ participation on the digital transformation of SMEs are explored. MATLAB 2018b is used for simulation to explore the mechanism of relevant parameters on the strategic choice of each participant. The results show that SMEs, service providers and governments are affected differently by each other’s willingness to participate. The improvement of government participation willingness has the greatest impact on service providers and SMEs to actively participate in digital transformation. The increase of collaborative income and government punishment has a positive impact on the evolution of the system. Government subsidies and incentives have a binding effect, and the decrease of both factors is conducive to system stability. There is a threshold of 30% for government subsidies to service providers, and the closer to 30%, the more conducive to the system to achieve an ideal state. Based on the research conclusion, promoting the active digital transformation of SMEs should further enhance the digital ability of SMEs, and the government should implement scientific reward and punishment mechanism, including appropriately increasing the subsidies for cloud services of service providers and improving the evaluation system of social responsibility of service providers.