Proceedings of the 1st Sampoerna University-AFBE International Conference, SU-AFBE 2018, 6-7 December 2018, Jakarta Indonesia

Research Article

Building Small-Medium Industry Institution Towards Sustainable Dynamic Small Industry

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  • @INPROCEEDINGS{10.4108/eai.6-12-2018.2286306,
        author={Oesman  Raliby and Effendi Bin Mohamad},
        title={Building Small-Medium Industry Institution Towards Sustainable Dynamic Small Industry},
        proceedings={Proceedings of the 1st Sampoerna University-AFBE International Conference, SU-AFBE 2018, 6-7 December 2018, Jakarta Indonesia},
        publisher={EAI},
        proceedings_a={SU-AFBE},
        year={2019},
        month={8},
        keywords={sme’s institution dynamic industry sustainable structural equation modelling},
        doi={10.4108/eai.6-12-2018.2286306}
    }
    
  • Oesman Raliby
    Effendi Bin Mohamad
    Year: 2019
    Building Small-Medium Industry Institution Towards Sustainable Dynamic Small Industry
    SU-AFBE
    EAI
    DOI: 10.4108/eai.6-12-2018.2286306
Oesman Raliby1,*, Effendi Bin Mohamad2
  • 1: Dept of Industrial Engineering-Muhammadiyah Magelang University, Indonesia
  • 2: Faculty of Manufacturing-Universiti Teknikal Malaysia Malaka, Malaysia
*Contact email: raliby@gmail.com

Abstract

Putting SME’s as the primary basis in development takes good commitment and coordination amongst stakeholders, government, people in business, and a non-business institution as well as the local community by applying the aggressive institution-based strategy. The research aims to construct an institutional framework model of small and medium-sized enterprises to become a dynamic, sustainable and robust business group. The approach used was FGD with some SME’s businessmen by using Participative Rural Appraisal in exploring the wishes of the institutional business development. The result of this activity showed the frame of competitiveness model of SME’s in Indonesia, which described several factors that support dynamization and competitiveness of SME’s. The Goodness of Fit test showed that the Adjusted R-squared value was 0.365 and 0.667. Several factors gathered were a set of institutional development factors that include actor empowerment and resources connectivity factors. SME’s developers rarely raise the last two elements. The previous two factors moderate external and internal factors as significant as 36.5% and 66.7%. The influence of these two factors can contribute to the institutional resilience of SME’s so that small industries can be more dynamic, competitive, independent and sustainable.