The Importance of Micro, Small, and Medium Enterprises Competitiveness through Digital Transformation
DOI:
https://doi.org/10.33005/jasf.v7i1.467Keywords:
Digital transformation, HR competence, marketing performance, social capital, MSMEs Badung Regency-Bali, IndonesiaAbstract
The emergence of the Industrial Revolution has led to transformative changes in global industries driven by digital technology and automation. These changes have brought both opportunities and challenges to MSMEs. This research examines how social capital, marketing performance, and human resources affect MSMEs' competitiveness with digital transformation as a mediating variable. This study uses quantitative methodology and a causal associative approach. A stratified random sampling technique will ensure adequate representation from different industries and geographical areas. Data were collected using a questionnaire distributed and filled out by 200 MSME entrepreneurs at three locations in Badung Regency: Kuta, North Kuta, and South Kuta, Bali-Indonesia. The data was analyzed using Partial Least Squares-Structural Equation Modeling (PLS-SEM). The results of this research show that social capital, marketing performance, and human resources have a significant influence on MSMEs' competitiveness. Digital transformation has an insignificant effect on MSME's competitiveness in Badung Regency, Bali Province. Digital transformation has been proven to mediate the effect of marketing performance on SMEs' competitiveness. Digital transformation cannot mediate the effect of social capital and human resources on SMEs' competitiveness in Badung Regency, Bali Province. The results of this study can serve as a guide for future researchers who will tackle related issues. In addition, more research is required to increase the variety of variables and locations to obtain more meaningful results.
Downloads
References
Alamsyah, Wahyu, A. R. M., Octavianty, Abbas, S. A., & Sunarta, D. A. (2024). Implementation of Technology in Developing Entrepreneurship and Innovation. Ekbis: Jurnal Analisis, Predeksi dan Informasi, 25(1), 147–157. https://jurnalekonomi.unisla.ac.id/index.php/ekbis/article/view/1451.
Alatas, R., Mohdari, & Kurnia, A. (2024). The Role of SME Human Capital Resource Competence in Improving SME Performance. Journal of Business and Behavioural Entrepreneurship, 8(1), 37–45. https://doi.org/10.21009/JOBBE.008.1.05.
Ayupijaya, M. (2021). Dampak Pandemi Covid-19 terhadap Ketenagakerjaan di Provinsi Bali. Jurnal Bali Membangun Bali, 2(3), 151–168. https://doi.org/10.51172/jbmb.v2i3.212.
BPS (2021). Statistik menurut Subjek, Badan Pusat Statistik Kabupaten Badung. Tenaga Kerja - Tabel Statistik - Badan Pusat Statistik Kabupaten Badung
Chen, Q., Zhang, W., Jin, N., Wang, X., & Dai, P. (2022). Digital Transformation Evaluation for Small- and Medium-Sized Manufacturing Enterprises Using the Fuzzy Synthetic Method DEMATEL-ANP. Sustainability (Switzerland), 14(20), 1–23. https://doi.org/10.3390/su142013038.
Costa, E. da, & Xiongying, N. (2021). The Role of Human Resources Competency on SMEs Performance in Timor–Leste. Eduvest - Journal of Universal Studies, 1(11), 1203–1213. https://doi.org/10.59188/eduvest.v1i11.259.
Desmiyawati, Susilatri, Ramaiyanti, S., & Azlina, N. (2023). Improving the Performance of MSMEs Through Innovation, Financial Literacy and Digitalization. JRAK: Jurnal Riset Akuntansi Kontemporer, 15(2), 151–161. https://journal.unpas.ac.id/index.php/jrak/article/view/7203.
Dian, U. N. M., & Bagus, P. I. (2021). Analysis of Factors Affecting the Welfare of MSME Welfare of Kembang Rampai in District Abiansemal, Badung Regency, Indonesia. Eurasia: Economics & Business, 10(52), 3–14. https://doi.org/10.18551/econeurasia.2021-10.
Dyatmika, S. W., Suyanto, B., Setijaningrum, E., & Setioningtyas, W. P. (2023). Redefining Indonesia’s MSMEs Landscape: Unleashing Digital Virality for Sustainable Growth. JASF: Journal of Accounting and Strategic Finance, 6(2), 280–299. https://doi.org/10.33005/jasf.v6i2.471
Fadillah, R., & Suryaningrum, D. H. (2021). The Importance of Trust and Information Technology on Individual Performance. Public Management and Accounting Review, 2(1), 11-22. https://doi.org/10.61656/pmar.v2i1.62
Ghi, T. N., Anh, N. T. P., Thu, N. Q., & Huan, N. Q. (2021). Entrepreneur’s Human Capital and Business Model Innovation: The Meditation Role of Access to Start-up Resources. International Journal of Information and Management Sciences, 32(1), 59–76. https://doi.org/10.6186/IJIMS.202103_32(1).0004.
Guo, H., Yang, Z., Huang, R., & Guo, A. (2020). The Digitalization and Public Crisis Responses of Small and Medium Enterprises: Implications from a Covid-19 Survey. Frontiers of Business Research in China, 14(1), 1–25. https://doi.org/10.1186/s11782-020-00087-1.
Herman, H., Rizkiyah, P., Widjaja, H. R., & Junaid, I. (2023). Determinant Factors in Managing Tourism Village: A Destination Attributes Approach. Jurnal Kepariwisataan: Destinasi, Hospitalitas dan Perjalanan, 7(1), 67–80. https://doi.org/10.34013/jk.v7i1.1129.
Jaya, P. E. J., Utama, M. S., Yasa, I. G. W. M., & Yuliarmi, N. N. (2020). Improving Competitiveness and Well-Being Through Human Resources Quality, Local Culture, and Product Performance. Cogent Business and Management, 7(1), 1–12. https://doi.org/10.1080/23311975.2020.1831247.
Kartika, I. M., Sumada, I. M., Suwandana, I. M. A., Adnyana, Y., Sedana, I. D. G. P., & Meryawan, I. W. (2024). Assessing the Performance and Competitive Strategies of Bamboo Weaving MSMEs in Bali Using Quantitative Associative Causal Design. Journal of Applied Data Sciences, 5(3), 1189–1209. https://doi.org/10.47738/jads.v5i3.320.
Khurrohmah, M., Liestyana, Y., & Wahyuningsih, T. (2022). Social Capital, Knowledge Sharing, Innovation, and Performance of Coffee Producer SMEs in Purworejo, Central Java. Jurnal Ilmiah Manajemen Kesatuan, 10(3), 471–482. https://doi.org/10.37641/jimkes.v10i3.1469.
Khusaini, K., Lestari, L. W., Widiarti, A., & Suherman, A. (2022). Social Capital and Location as Determinants in Improving MSME Performance. JPEB: Jurnal Pendidikan Ekonomi dan Bisnis, 10(2), 123–136. https://doi.org/10.21009/jpeb.010.2.3.
Kmecová, I., Stuchlý, J., Sagapova, N., & Tlustý, M. (2021). SME Human Resources Management Digitization: Evaluation of the Level of Digitization and Estimation of Future Developments. Polish Journal of Management Studies, 23(2), 232–248. https://doi.org/10.17512/pjms.2021.23.2.14.
Komala, A. R., & Firdaus, D. W. (2023). Improving the Quality of Financial Statements and the Survival of MSMEs Through Digital Economy: The Case of Indonesia and Malaysia. Journal of Eastern European and Central Asian Research, 10(5), 752–763. https://doi.org/10.15549/jeecar.v10i5.1435.
Marjukah, A. (2022). Pengaruh Pelatihan Pemasaran Digital terhadap Kinerja UMKM Pada Masa Pandemi Covid-19. Jurnal Keuangan dan Bisnis, 20(1), 1–12. https://doi.org/10.32524/jkb.v20i1.316.
Meflinda, A., Mahyarni, M., Indrayani, H., & Wulandari, H. (2018). The Effect of Social Capital and Knowledge Sharing to the Small Medium Enterprise’s Performance and Sustainability Strategies. International Journal of Law and Management, 60(4), 988–997. https://doi.org/10.1108/IJLMA-03-2017-0073.
Millendra, F., & Marwan. (2022). Pengaruh Kompetensi SDM dan Modal Finansial Terhadap Kinerja Usaha Kerajinan Sulaman di Desa Naras. Jurnal Salingka Nagari, 01(2), 379–396. https://doi.org/10.24036/jsn.v1i2.51.
Muliadi, S. (2021). SAS APP: Mewujudkan UMKM Berbasis Digital Dalam Rangka Pemberdayaan Ekonomi Masyarakat Pringgasela Lombok Timur. JMM (Jurnal Masyarakat Mandiri), 5(4), 1877–1885. https://doi.org/10.31764/jmm.v5i4.5104.
Mutoharoh, Winarsih, & Buyong, S. Z. (2020). Digitalization of Accounting Information Impact on MSMEs Profitability and Productivity. JRABA: Jurnal Riset Akuntansi Dan Bisnis Airlangga, 5(2), 867–884. https://doi.org/10.31093/jraba.v5i2.233.
Nguyen, D. H. A., Tran, G. N., Tran, K. D., & Nguyen, T. H. (2023). Social Capital and Digital Transformation of Startups in Vietnam: The Mediating Role of Access to Resources. Management, 27(1), 184–200. https://doi.org/10.58691/man/172206.
Nur, R. R., & Made, N. I. (2024). Micro, Small, and Medium-Sized Enterprises (MSMEs) During the Post-Pandemic Economic Recovery Period: Digitalization, Literation, Innovation, and its Impact on Financial Performance. Cogent Business & Management, 11(1), 1–16. https://doi.org/10.1080/23311975.2024.2342488.
Nurani, N., Nurjanah, R., & Prihantoro, I. (2021). Competence of Human Resources of Small and Medium Enterprises (MSMEs) of West Java through Intellectual Property Rights (IPR) Protection in the COVID-19 Pandemic Era. Psychology and Education, 58(3), 251–264. https://doi.org/10.17762/pae.v58i3.2706.
Oduro, S., & Williams, E. M. (2023). Marketing Capabilities and Competitive Performance in the SMEs Context: A Bi-Theoretical Perspective. Journal of Small Business Strategy, 33(2), 17–35. https://doi.org/10.53703/001c.77458.
Prabandari, S. P., Yulianti, I., & Risanto, Y. (2023). Does Social Capital Affect SME’s Performance? International Journal of Social Service and Research, 3(11), 2783–2793. https://doi.org/10.46799/ijssr.v3i11.579.
Prasetyo, P. E., Setyadharma, A., & Kistanti, N. R. (2020). Social capital: The main Determinant of MSME Entrepreneurship Competitiveness. International Journal of Scientific and Technology Research, 9(3), 6627–6637. https://www.ijstr.org/final-print/mar2020/.
Purwati, A. A., Budiyanto, & Suhermin. (2021). Social Capital, Entrepreneurial Leadership and SMEs Performance: The Mediating Effect of Innovation Capability. Jurnal Pendidikan Bisnis dan Manajemen, 7(3), 170–181. https://doi.org/10.17977/um003v7i22021p170.
Putra, R. E., Neswardi, S., Primadona, P., Jumyetti, J., & Yuanita, I. (2023). Impact of Digital Leadership on Small Medium Enterprises Resilience: The Mediating Role of Employee Creativity. AMAR: Andalas Management Review, 7(1), 35–61. https://doi.org/10.25077/amar.7.1.35-61.2023.
Rahman, S., Suyono, S., Setyawan, O., & Irman, M. (2023). Analysis of SMEs Performance Based on Innovation Practice, Market Orientation, and Innovation Barriers. Diponegoro International Journal of Business, 6(2), 77–89. https://doi.org/10.14710/dijb.6.2.2023.77-89.
Safkaur, O., & Sagrim, Y. (2019). Impact of Human Resources Development on Organizational Financial Performance and Its Impact on Good Government Governance. International Journal of Economics and Financial Issues, 9(5), 29–37. https://doi.org/10.32479/ijefi.8508.
Sembiring, R. (2016). Impact of Human Resources’ Knowledge and Skills on SMEs in Medan City, Indonesia. International Journal of Management, 5(3), 95–104. https://www.econstor.eu/bitstream/10419/.
Sumaryanto, S., & Widajanti, E. (2023). MSME Marketing Performance during the COVID-19 Pandemic: The Role of Empowered Interaction Capability. Journal of Economics, Business, & Accountancy Ventura, 25(3), 382–397. https://doi.org/10.14414/jebav.v25i3.2799.
Sunarti, Hasanah, Oktariani, D., Akbar K, D. A., & Afif, S. (2023). The Influence of Human Resource Competence and Financial Aspects on the Performance of MSMEs in the Cirendeu Village Area, South Tangerang. Endless: International Journal of Future Studies, 6(2), 278–287. https://doi.org/10.54783/endlessjournal.v6i2.176.
Surjanti, R. L. P. N. S., Mulyantomo, E., & Triyani, D. (2024). Analysis of Determinants of MSMEs Performance. IJEDR: International Journal of Economics Development Research, 5(2), 825–839. https://journal.yrpipku.com/index.php/ijedr/article/view/5060/2804.
Susanti, E., Mulyanti, R. Y., & Wati, L. N. (2023). MSMEs Performance and Competitive Advantage: Evidence from Women’s MSMEs in Indonesia. Cogent Business and Management, 10(2), 1–26. https://doi.org/10.1080/23311975.2023.2239423.
Sutrisno, Kraugusteeliana, & Syamsuri. (2024). Analysis of the Interconnection between Digital Skills of Human Resources in SMEs and the Success of Digital Business Strategy Implementation. MALCOM: Indonesian Journal of Machine Learning and Computer Science, 4(2), 601–606. https://doi.org/10.57152/malcom.v4i2.1282.
Sutrisno, Wibowo, B. Y., & Widodo. (2024). Competitive Social Capital in Improving the Performance of Small and Medium Enterprises (SMEs): Role of Knowledge Donating and Knowledge Collecting. Corporate Governance and Organizational Behavior Review, 8(2), 60–72. https://doi.org/10.22495/cgobrv8i2p6.
Thousani, H. F., & Edy, M. H. (2024). The Impact of Entrepreneurial Orientation and Innovation Strategy on MSME Performance in Bali’s Apparel Sector. IJHESS: International Journal of Health, Economics, and Social Sciences, 6(3), 726–733. https://doi.org/10.56338/ijhess.v6i3.5620.
Utama, P. Z. M., & Indarwati, T. A. (2023). Mediation of Digital Innovation on Digital Marketing Capabilities Towards Marketing Performance (a Study on Food and Beverage SMEs in Gedangan Sub-District). International Management Conference and Progressive Papes, 1(1), 154–171. https://proceeding.unesa.ac.id/index.php/immersive/article/view/771.
Widiastini, N. M. A., Arsa, I. K. S., Syah, A. M., & Hajarrahmah, D. (2023). How do Micro, Small, and Medium Enterprises (MSMEs) in Bali Survive the Pandemic? A Qualitative Study in Buleleng, Tabanan, Gianyar, and Denpasar. JPB Review: International Journal of Professional Business Review, 8(3), 1–24. https://doi.org/10.26668/businessreview/2023.v8i3.829.
Yuliantari, N. P. Y., & Pramukki, N. M. W. A. (2022). The Role of Competitive Advantage in Mediating the Relationship Between Digital Transformation and MSME Performance in Bali. Jurnal Ekonomi dan Bisnis Jagaditha, 9(1), 66–75. https://doi.org/10.22225/jj.9.1.2022.66-75.
