Moderation effect of competence of knowledge and innovation: case of Bali

Abstract

PurposeThis paper examines how market orientation and competence of knowledge reinforce the innovation and in turn improve the business performance.Design/methodology/approachThis research applied research design with quantitative approach based on positivism philosophy, that is, research aimed to test the theory and data which is general to produce findings that are special through hypothesis test. This study was supplemented by field studies as a necessary source of data in the form of trends, attitudes, opinions, perceptions of owners, managers or senior employees of SMEs in the textile industry in Bali, related to the variables used in this study.Findings(1) Market orientation influences business performance, (2) competence of knowledge moderates the influence of market orientation on business performance, (3) innovation moderates the influence of market orientation on business performance.Originality/value(1) Novelty of this research is developing the concept of competence of knowledge associated with business performance in which this relationship has not yet been expressed. (2) Building the concept of innovation development of small-scale industry based on the market orientation. (3) Developing the concept of innovative development of small and medium enterprises of textile industry based on competence of knowledge. (4) Investigating the concept of market orientation and competence of knowledge in an integrated and holistic way to strengthen the innovation and business performance of SMEs of the textile industry in Bali.

Factors Affecting Business Performance Through Knowledge Competence as a Mediation Variable

“…Wahyuni & Sara (2020) stated in their research that knowledge competence mediates market orientation on business performance. This research is supported by research by Usman et al (2020) which states that knowledge competence fully mediates the relationship between market orientation and business performance. Based on the explanation above, the formulation of the formed hypothesis is: Ha5: Market orientation has a positive effect on business performance through knowledge competence as a mediation variable.…”

“…This includes the organizational culture that allows the company to stay together and respond to changing customer needs, competitor activities, and changing market trends in order to survive. Usman et al (2020) stated that knowledge competence is a means to achieve competitive advantage, knowledge competence is an organizational strategic asset. Knowledge competence is a superior resource that creates a competitive advantage when a company can use it.…”

“…The resource-based view of the enterprise provides a comprehensive explanation of how a company is able to achieve business performance through knowledge competencies to distribute resources and capabilities. With unique knowledge resources or competencies, a company can use them to get higher business performance (Usman et al, 2020). Subsequent research by Paraswati & Laily (2018) states that knowledge competence has a significant effect on improving business performance.…”

“…A positive attitude plays an important role in increasing knowledge competence, the importance of market orientation in increasing knowledge competence so that business performance can become an integrated unit (Wahyuni & Sara, 2020). Usman et al (2020) stated that knowledge competence related to market orientation shows a company's ability to change itself. Knowledge competency can lead to new product design.…”

Innovación social para la conservación de prácticas textiles-artesanales basados en gestión de conocimiento y educación intercultural

“…Likewise, Shafi et al (2019), Usman et al (2019), and Kozlowski et al (2018) support the idea that the problems of creative enterprises are related to the limitation of resources and forehead their competition with the cheaper industrial substitutes, which allow the improvement of the quality of the artisanal process and the participation of the consumers. Thus, the preservation of the artisanal textile process is an innovation process that, apart from the trade market, aims to stimulate tourism that, in the specific case of the municipality, is based on the attractiveness and recognition of the weaving practices.…”