The existence of traditional markets as social institutions has a strategic role in the development process of a nation. But with the entry of modern civilization and dynamic market conditions the existence of traditional markets is threatened with extinction. Efforts to develop traditional markets become a particular concern of the government and an interesting issue to be studied. Some studies have discussed the weaknesses of traditional markets but few have discussed their development strategies. This study aims to analyze the strategies for developing traditional market performance in this disruptive and dynamic era by increasing ambidexterity and strategic orientation. In addition, this study also aims to analyze supply chain integration in traditional markets as a moderation of the relationship between ambidexterity and strategic orientation towards the performance of traditional markets. Empirical results are obtained through the distribution of questionnaires to 126 traditional market managers in Sleman, Yogyakarta. The study conducted structural equation modeling to test the proposed relationships. The result show that ambidexterity and supply chain integration have a significant influence on firm performance but ambidexterity does not have a significant effect on supply chain integration, while strategic orientation has a significant effect on supply chain integration but does not significantly influence firm performance. This study is the first empirical test to examine the impact of ambidexterity and strategic orientation toward traditional market performance. The study results may help managers of traditional market to implement ambidexterity, strategic orientation and supply chain integration to develop traditional market's performance.

The key to the success of the company in this dynamic era is innovation capability and absorptive capacity. There is a paucity of research that links these two things with supply chain integration, especially for SMEs. This study aims to analyze the relationship between innovation capability, absorptive capacity and supply chain integration in improving the performance of SMEs in the creative industry of Yogyakarta Indonesia. The empirical test, which used a sample of 143 managers of the creative industry SMEs in Yogyakarta supports most of the hypotheses in the study. The study conducted structural equation modeling to test the proposed relationship. The results demonstrate that innovation capability and absorptive capacity have a significant influence on the performance of SMEs both directly and through increasing supply chain integration as a moderating variable. The results of this study are expected to be able to contribute to SME managers both owners and the government in improving the performance of creative industry SMEs in Yogyakarta.

Innovation Capability and Supply Chain Integration in MSMEs Performance IntroductionCreative Economy is one of the sectors that is expected to be able to become a new power of the national economy in the future, along with the condition of natural resources that are increasingly degraded each year. Indonesian creative economy statistical data in 2016 states that from 2010 to 2015, the magnitude of the Gross Domestic Product (GDP) of the creative economy has increased by an average of 10.14% annually, from Rp. 525.96 trillion to Rp. 852.24 trillion. This value contributes to the national economy of 7.38% to 7.66% which is dominated by three subsectors including: Culinary 4`, 69%, fashion 18.15% and craft 15.70% (Bekraf, & BPS, 2017) From the several creative economy industries in Indonesia, the main support for its growth is from MMSMEs (Bekraf & BPS, 2017). MMSMES together with the community can grow the economy in the country, in accordance with the objectives of MMSMES in Article 3 of the Constitution no. 20 of 2008 which states that "Micro, Small and Medium Enterprises aim to grow and develop their businesses in the context of building a national economy based on a just economic democracy". MMSMEs also have the right empowerment goals as stipulated in article 5 law no. 20 of 2008 namely "realizing the structure of the national economy that is balanced, developed, and fair; grow and develop the capability of Micro, Small and Medium Enterprises into a tough and independent business; and increasing the role of Micro, Small and Medium Enterprises in regional development, job creation, income distribution, economic growth, and alleviating people from poverty ".One of the centers of MMSMEs engaged in the creative economy industry is the pottery industry in Kasongan, Bantul, Yogyakarta. Kasongan is indeed famous for its pottery products for a long time. About 95% of the population of Kasongan profession as pottery artisans. Under these conditions, improving the performance of MMSMEs in Kasongan can increase the welfare of the Kasongan community. However, in this dynamic era, competition is becoming more complex, especially from online sales, prices that are inferior to competitors because of a lack of integration with suppliers is also an obstacle in improving the performance of MMSMEs in Kasongan, Bantul.Rapid technological advances and high levels of competition require companies to continuously innovate products that will ultimately improve company performance. Performance is the main key to survive in the global era. Many factors determine a company's performance, one of which is innovation. Rapid technological progress and high levels of competition demand continuous innovation, which in turn will improve business performance. Product innovation is one of the effects of rapid technological change and high product variation will determine organizational performance (Gebrekidan, Awuah, & Iddris, 2014).Businesses are expected to be able to change their profit-oriented life culture into customer-oriented so that l...