Strenghthening Competitiveness For SMES: A Conceptual Framework Strenghthening Competitiveness For SMES: A Conceptual Framework
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Published:
Feb 1, 2020
Keywords:
SMEs, Competitiveness, Flexibility and Productivity of Business
Section
Computer Science
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Abstract
The development of SMEs has very important role in creating employment and reducing poverty. However, the intensity of business competition is very high too, so the SMEs need to have the strength of competitiveness in order to sustain in the business world. Therefore, the purpose of this paper is to identify the main factors influencing the success of the SME competitiveness. Exploration is used as the basis approach for the analysis, in which the flexibility and productivity of the business become the main aspects. The results showed that the ability of SMEs in building a network effectively and efficiently is a determinant of the level of flexibility and productivity of SMEs. The network characteristics are marked by three conditions, namely (i) the efficiency of business by minimizing transaction costs, (ii) the increase of working capital accessibility, and (iii) the innovative business climate. The analysis provides important insights for the government that the efficient and effective expansion of the business network should be focused on the SME development policy.
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Magalhaes, L. and Hartanto, A. D. (2020) “Strenghthening Competitiveness For SMES: A Conceptual Framework: Strenghthening Competitiveness For SMES: A Conceptual Framework”, Jurnal Mantik, 3(4), pp. 278-285. Available at: https://iocscience.org/ejournal/index.php/mantik/article/view/565 (Accessed: 4May2026).
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[2] Anton, S.A., Muzakan, I., Muhammad, W.F., Syamsudin.,& Sidiq, N.P. 2015. An assessment of sme competitiveness in indonesia. Journal of Competitiveness, Vol. 7, No. 2, pp. 60-74.
[3] Braun, P., Williams, P.M., Lowe, J. 2005. Small Business Clustering: Accessing Knowledge Through Local Networks. CRIC Cluster Conference, June 30-July 1, Ballarat.
[4] Ceci, F., Lubatti, D. 2012. Personal Relationship and Innovation Diffusion in SME Networks: A Content Analysis Approach. Research Policy. Vol 41, pp. 565-579.
[5] Ceciliy, M., Castleman, T., Parker, C. 2012. Communities of Enterprises: SMEs, ICT, and Regional Development. Deakin Business School: Deakin University.
[6] Constantin, D. L. 2002. Small and Medium Enterprises, Regional Development and Networking: The Emerging Framework in Romania. Romanian Journal of European Affairs. Vol. 2, No.4.
[7] Darwanto., Santosa, P.B., Woyanti, N.,& Bambang. 2019. Designing model and strategy for strengthening the competitiveness of small medium enterprises. Etikonomi, Vol. 17, No. 1, pp. 69-92.
[8] Doloreux, D. 2004. Regional Networks of Small and Medium Sized Enterprises: Evidence from the Metropolitan Area of Ottawa in Canada. European Planning Studies, Vol. 12, No. 2, pp. 173-189.
[9] Gafsi, M. and J Brossier. 2002. Collective Dimension and Learning Process Coping with Change of Farming Practices to Preserve Water Quality’, Vol.4.
[10] Hamdani, N.A.,& Maulani, G.A.F. 2019. The influence information technology capabilities and differentiation on the competitiveness of online culinary smes. International Journal of Recent Technology and Engineering (IJRTE), Vol. 8, No. 1, pp. 146-150.
[11] Idar, R., Yussof, Y., and Mahmood, R. 2012. The Effect of Market Orientation as Mediator to Strategic Planning Practices and Performance Relationship: Evidence from Malaysian SMEs. Procedia Economics and Finance. Vol 4, pp. 68-75.
[12] Indrawati, S. 2012. SME’s Product Investment Priority and Selection Based On Local Competencies. Procedia Economics and Finance. Vol. 4, pp. 59-67.
[13] Irjayanti, M., and Azis, A. M. 2012. Barrier Factors and Potential Solution for Indonesian SMEs. Procedia Economics and Finance. Vol 4, pp. 3-12.
[14] Jiang, B. 2009. Flexible Business Process Integration for Clusters of Small-Medium Sized Enterprises in Heterogenous Environment. Journal of Software. Vol. 4, No. 4, June.
[15] Kadocs, G. 2006. Research of competitiveness factors of sme. Acta Polytechnica Hungarica. Vol. 3, No. 4, pp. 71-84.
[16] Kimura, F., Lim, H. 2009. The Internationalization of SMEs in Regional and Global Value Chains. ADB Institute: Singapore.
[17] Kiyabo, K.,7 Isaga, N. 2019. Strategic entrepreneurship, competitive, advantage, and smes performance in the welding industry in tanzania. Journal of Global Entrepreneurship Research, Vol. 9, No. 62, pp. 01-23.
[18] Lang, Richard; Roessl, Dietmar. 2012. The Role of Social Capital in the Development of Community-Based Cooperatives. Research Institute: Vienna.
[19] Lewis, W.G., Pun, K.F., and Lalla, T.R.M., 2006. Exploring Soft Versus Hard Factors for TQM Implementation in Small and Mediumsized Enterprises, International. Journal of Productivity and Performance Management, Vol. 55 No. 7, pp. 539-554.
[20] Lussier, N, Robert and Sanja, Pfeifer. 2001. Across Nation Prediction Model for Business Success. Journal of Small Business Management. 39(3). pp. 228-239.
[21] Mankiw, N, Gregory. 2006. Principles of Economics Pengantar Ekonomi Mikro. Penerbit Salemba Empat. Jakarta.
[22] Marchese, M., Potter, J. 2011. Entrepreneurship, SMEs and Local Development in Andalusia, Spain. OECD Local Economic and Employment Development (LEED) Working Papers: OECD Publishing.
[23] Marijan, Kacung. 2005. Mengembangkan Industri Kecil Menengah Melalui Pendekatan Kluster. INSAN, Vol. 7 No. 3, Desember.
[24] Mura, L., and Buleca, J. 2012. Evaluation of Financing Possibilities of Small and Medium Industrial Enterprises. Procedia Economics and Finance. Vol 3, pp. 217-222.
[25] Ngah, R., Wahab, I.A.,& Salleh, Z. 2015. The sustainable competitive advantage of small and medium enterprises (smes) with intelectual capital, knowledge management and innovative intellegence: building a conceptual framework. Advenced Science Letters, Vol. 21, No. 5, pp. 1325-1328.
[26] Nikraftar, T. 2016. The competitiveness of small and medium sized enterprises of stone industry. Journal of Engineering Management and Competitiveness (JEMC), Vol. 6, No. 2, pp. 92-98.
[27] Noe, E. and N. Halberg. 2002. Research Experience with Tools to Involve Farmers and Local Institutions in Developing more Environmentally Friendly Practices’, Vol.4.
[28] Nugroho, Hari & Tjandraningsih Indrasari. 2007. Fleksibilitas Pasar Kerja dan Tanggung Jawab Negara. Akatiga: Bandung.
[29] Panggabean R. 2007. Profil Inkubator dalam Penciptaan Wirausaha Baru. Kementerian KUKM: Jakarta.
[30] Patrick, G. 2017. Clustering and product innovativeness: a literature review of small and medium-sized enterprises (smes) in kenya. International Journal of Academic Research in Economics and Management Sciences, Vol. 6, No. 4, pp. 115-145.
[31] Pattit, Jason M, Raj, S.P, Wilemon, David. 2012. An Institutional Theory Investigation of U.S. Technology Development Trends Since the Mid-19th Century. Research Policy, Vol. 41, pp. 306-318.
[32] Prasanna., Jayasundara., Gamage, S.K.N., Ekayanake, E.M.S., Rajapakshe, P.S.K.,& Abeyrathne. 2019. Sustainability of smes in the competition: a systemic review on technological challenges and sme performance. Journal of Open Innovation: Technology, Market,and Complexity. Vol, 5, No. 100, pp. 02-18.
[33] Rengkung, L.R., Pangemanan, L.R.J.,& Sondak, L.W. 2017. Competitiveness of small and medium firms (smes) in facing asean economic community. International Research Journal of Business Studies, ol. X., No. 02, pp. 123-133.
[34] Sabatini, Fabio; Modena, Fransesca; Tortia, Ermanno. 2011. Do Cooperative Enterprises Create Social Trust?. European Research Institute on Cooperative and Social Enterprises (Euricse): Trento.
[35] Setyaningsih, S. 2012. Using Cluster Analysis Studi to Examine the Successul Performanca Entrepreneur in Indonesia. Procedia Economics and Finance. Vol. 4, pp. 286-298.
[36] Siddik, N.A. 2018. Determinants of international competitiveness of smes in a developing economy: evidence from bangladesh. International journal of business and management, Vol. 13, No. 1, pp. 266-276.
[37] Singh, R.L.,& Grag, S.K. 2008. Strategy development by smes for competitiveness: a review. Benchmarking: An International Journal, Vol. 15, No 5, pp. 525-547.
[38] Sitompul, C. 2012. A Supply Chain Planning for Small and Medium Enterprises. Procedia Economics and Finance. Vol. 4, pp. 384-389.
[39] Supratikno, Hendrawan. 2007. Kritik untuk Neoklasik dan Sosialisme. Dalam Dharmawan, Bagus (Ed), Esai-Esai Nobel Ekonomi (halaman 53-58). Jakarta: PT Gramedia.
[40] Tobing, D.S., Fathorazzi, M.,& Wulandari, G.A. 2018. Mapping the competitive advantage of smes in east java, indonesia. Jurnal Dinamika Manajemen, Vol. 9, No. 1, pp. 23-32.
[41] Utama, A. 2003. Perusahaan Dalam Era Persaingan Global Melalui Aliansi Strategis. Kajian Bisnis. No. 30, Desember, pp. 57-73.
[42] Utami, R.M.,& Lantu, D.C. 2014. Development competitiveness model for small-medium enterprises among the creative industry in bandung. Social and Behavioral Science, Vol. 115, pp. 305-323.
[43] Utomo, H. and Dodgson, M. 2001. Contributing Factor to the Diffusion of IT Within Small and Medium-Size Firms in Indonesia. Journal of Global Information Technology Management. Vol. 4 No. 2, pp. 22-37.
[44] Wignaraja, G. 2012. Engaging Small and Medium Enterprises in Production Network: Firm Level Analysis of Five ASEAN Economies. ADBI Working Paper. No. 361. Tokyo:Asian Development Bank Institute.
[45] Wisentige, K.,& Guoping, C. 2016. Firm level competitiveness of small and medium enterprises (smes): analytical framework bsed on pillars of competitiveness model. International Research Journal of Management, IT& Social Science (IRJMIS), Vol. 2, No. 9, pp. 51-56.
[46] Yustika, E. Ahmad. 2008. Ekonomi Kelembagaan ; Definisi, Teori dan Strategi. Bayu Media Publishing: Malang.