THE INFLUENCE OF THE BUSINESS ENVIRONMENT ON INNOVATION AND ITS IMPLICATIONS FOR THE MSMES PERFORMANCE (A STUDY ON AGRIBUSINESS MSMES IN MAJALENGKA DISTRICT)
Keywords:
Internal Environment, External Environment, Innovation, MSMEs Performance
Abstract
Agrobussiness Micro, Small and Medium Enterprises (MSMEs) are those engaged in processing agricultural products into processed products. This business has an important role in creating added value to primary agricultural products, expanding the scope of marketing areas, expanding and increasing employment opportunities as well as telecommunications and marketing, increasing farmers' income sources as suppliers of agricultural products, and encouraging food security development. The development of Agrobussiness MSMEs in Majalengka District must be a concern for the local government, because it requires equal distribution of program socialization by involving the community, conducting comprehensive MSME assistance, improving synergy and coordination between agencies responsible for distributing assistance and coordination between the Central Government and Local Government. In addition, MSME actors must also improve their performance in running a business by paying attention to factors that affect the performance of MSMEs themselves such as the business environment and innovation. This research is conducted to see how specific business environment factors affect the innovation process in MSMEs and how these innovations then lead to overall performance improvement. While existing studies underscore the importance of creative marketing strategies and adaptation to the environment, no study has yet taken an in-depth look at the relationship between these two factors and how they influence each other. The population of this study is the owners of Agroindustry MSMEs in Majalengka District, the number of which is not known with certainty. The sampling technique used was purposive sampling. The number of samples taken was 148 respondents. Data collection using a questionnaire. Processing techniques use SEMPLS modeling equations. The results showed that the internal and external environment had a significant effect on innovation, and innovation mediated the influence of the internal and external environment on MSMEs performance. Innovation needs to be carried out by MSMEs to improve their performance by utilizing the potential and opportunities of their internal and external environment by encouraging employees to think creatively, share ideas, and create a work environment that supports experimentation and learning. MSMEs must also establish partnerships and collaborations with research institutions, universities and other institutions to access knowledge, technology and resources that can support innovation. As well as building and strong business networks with partners, suppliers, and customers to gain insights, feedback, and collaboration opportunities that can accelerate the innovation process.References
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Chesbrough, H. (2019). Open Innovation Results: Going Beyond the Hype and Getting Down to Business. Oxford University Press.
Eliora Lorensa, Nur Hidayah, 2022. Pengaruh Inovasi Produk, Orientasi Pasar dan Media Sosial Terhadap Kinerja UMKM Fashion, Jurnal Manajerial dan Kewirausahaan, 4(3), 22-37.
Fernández-Mesa, A., & Alegre, J. (2018). Social Support and Innovation in SMEs: A Review and Research Agenda. Journal of Small Business Management, 56(2), 370-393.
Gendut Sukarno, (2011). Meningkatkan Kinerja Pemasaran UMKM Melalui Peran Lingkungan, Inovasi Produk dan Kreatifitas Strategi Pemasaran, EKUITAS, 11 (3), 80-92
Hair J.F., et al. (2010). Multivariate Data Analysis Seventh Edition. New Jersey: Pearson Prentice Hall.
Kusumawati, R. (2022). Pengaruh Karakteristik Pimpinan dan Inovasi Produk Baru Terhadap Kinerja Perusahaan Untuk Mencapai Keunggulan Bersaing Berkelanjutan. Jurnal Ekonomi dan Bisnis 5 (9): 53-64.
Lino Pereira, Tutri Hanggari Citra Rini, (2022). Pengaruh Lingkungan Eksternal Dan Lingkungan Internal Terhadap Kinerja UKM Melalui Keunggulan Bersaing Pada UKM Di Kota Sorong, AKSELERASI: Jurnal Ilmiah Nasional, 4(3), 80-102.
Moeheriono, (2012). Manajemen Kinerja Divisi Buku Perguruan Tinggi, PT Raja GrafindoPersada Jakarta.
Muhammad Badar, Herniah, Hajrah, Pengaruh Inovasi Produk Terhadap Kinerja Bisnis UMKM Martabak di Kota Makasar, OSFPreprints, diakses dari https://osf.io/preprints/osf/gwdxb
Muhammad Rijal, Sri Zuliarni, (2016). Pengaruh Lingkungan Bisnis Terhadap Kinerja UMKM (Kasus Pada Sentra Pengolahan Ikan Di Kampung Patin Desa Koto Mesjid, Kampar, Riau), Jom FISIP, 3(1), 8-30
Neli Anggraini, Vicky F Sanjaya, (2021). Pengaruh Faktor Lingkungan dan Strategi Pemasaran Terhadap Kinerja Pemasaran Pada UMKM di Lampung Barat, Jurnal Ilmu Manajemen Saburai, 07(02), 15-32
Rahman, A., & Ali, M. (2020). Innovation Mediation in the Relationship between Internal Environment and SMEs Performance: Evidence from Bangladesh. Journal of Innovation and Entrepreneurship, 8(4), 112-125.
Rayadi. 2012. Faktor Sumber Daya Manusia Yang Meningkatkan Kinerja Karyawan Dan Perusahaan Di Kalbar. Jurnal EKSOS, 8(2), 114–119.
Schumpeter, J. A. (2021). Capitalism, Socialism and Democracy (5th ed.). Harper & Brothers.
Slamet Riyanto, 2018. Analisis Pengaruh Lingkungan Internal dan Eksternal Terhadap Keunggulan Bersaing dan Kinerja UKM di Madiun, Jurnal Manajemen Bisnis dan Inovasi, Vol. 05 No. 03
Srimindarti, (2019). Dampak Kreativitas Dan Inovasi Produk Terhadap Kinerja UKM di Kota Semarang. Jurnal Penelitian Humaniora, 21(1), 69-77.
Stinchcombe, A. (2021). External Environment and SME Performance: A Review and Future Research Agenda. Journal of Small Business Management, 59(S1), 34-55.
Sugiyono. (2021). Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung: Alfabeta.
Sulastini, Fariansyah, Hussnurrofiq, (2021). Pengaruh Inovasi dan Informasi Terhadap Kinerja (Studi Pada UMKM di Kota Banjarmasin), Jurnal Bisnis dan Pembangunan, 10(2), 42-60
Sun, Y., et al. (2023). The Mediating Role of Innovation in the Relationship between Environmental Factors and Performance of Small and Medium Enterprises: Evidence from Vietnam. Journal of Small Business Management, 31(2), 321-335
Teece, D. J. (2019). Business Models, Business Strategy, and Innovation: A Roadmap for Enterprise Transformation. Harvard Business Review Press.
Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland III, A. J. (2021). Crafting & Executing Strategy: The Quest for Competitive Advantage (22nd ed.). McGraw Hill.
Tidd, J., Bessant, J., & Pavitt, K. (2017). Managing Innovation: Integrating Technological, Market, and Organizational Change (6th ed.). John Wiley & Sons.
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