Business strategy – MSMEs' performance relationship: innovation and accounting information system as mediators

Abstract

PurposeThis study provides empirical evidences on the relationship between business strategy and micro, small and medium enterprises (MSMEs) performance. Additionally, the study aims to explore the role of innovation and accounting information systems (AISs) in the strategy performance linkage among MSMEs in Indonesia.Design/methodology/approachA questionnaire-based survey was conducted, which produced 102 valid responses. Surveys were distributed to MSME owners throughout Solo, Yogyakarta and Semarang, Indonesia. Data were analyzed by using structural equation model with partial least squares.FindingsThe result shows that business strategy has indirect impacts on MSMEs' performance. Both innovation and AIS positively mediate the relationship between business strategy and MSMEs’ performance.Research limitations/implicationsThe performance variable was measured based on the owners' perception. This makes the results not to be reflective of the real performance situation.Practical implicationsAlignment between strategy and innovation plays a vital role in improving the performance of MSMEs. The differentiation strategy that focuses on product uniqueness and quality requires innovation to add value to the product and the customer. The innovation process is at high risk of failure, so MSMEs owners need accurate calculations in decision making. AISs are part of management control to reduce risk by identifying standards and directing organizational goals.Originality/valueThis study considers the contingency factors in the relationship between strategy and performance by providing innovation variables and AIS.

Entrepreneurial orientation and SME performance: The mediating role of learning orientation

“…The business strategy of the firms was measured by five scale items adapted from the study of Latifah et al (2020). Sample items for the measurement of the business strategy include: The Company has shown innovation and creativity in the market, and the company continues to see product quality based on differentiation.…”

Digital Marketing, Msme Product Marketing Innovation

“…What also needs to be considered is that generally consumers are now social media users, especially young consumers. The results of research on the effect of digital marketing strategies on consumer buying interest based on a case study on the online shop Azzam Store it is known that digital marketing strategy and consumer buying interest are considered quite good with a total average score of 336.67 for online marketing strategies and 343.33 for consumer buying interest (Latifah et al, 2021).From this study it can also be concluded that the coefficient between online marketing strategy and consumer buying interest has a very close relationship. If sellers and consumers here have a good relationship, then this can be a major factor in increasing the buying interest of MSME actors (Huang et al, 2018).One effective way is to use a digital marketing strategy that is still rarely used by MSMEs.…”

“…For this reason, MSME actors must ensure that every digital marketing can reach consumers through several integrated social media so that marketing content is spread optimally (Handoyo, 2015).One social media content with other social media has a relationship or uploads the same content, especially on Instagram, Facebook and Twitter with a format that is adapted to the social media used (Zehir et al, 2015). Trusov in a journal written by said that electronic WOM and advertising through social media help marketing and attract consumers at cheaper and faster prices (Latifah et al, 2021)…”

Optimization of Accounting Information System for Enterprises in Smart City by Intelligent Sensor under the Internet of Things

“…e normal operation of the accounting system is related to the stable and long-term operation of the enterprise. However, at present, there are system crises in the enterprise, so the current operation status of the enterprise AIS can be obtained by releasing corresponding questionnaire questions [33][34][35]. erefore, 310 questionnaires were randomly distributed to the accounting related personnel of enterprises in model smart cities between June 2019 and August 2020.…”