Purpose This paper aims to explore and explain how predecessors (incumbents) of ethnic Chinese family small and medium-sized enterprises (SMEs) in Indonesia or appropriately called Chinese-Indonesian family SMEs nurture their successors in procuring transgenerational entrepreneurship. Design/methodology/approach A total of 25 participants were involved in this qualitative study which employed a multi-method triangulation design with the following research instruments: semi-structured in-depth interviews with experts, incumbents and successors of Chinese-Indonesian family SMEs, field notes from conversations and observations during engagement with participants affiliated to the family SMEs, a focus group discussion with academicians and literature reviews. Another key approach is source triangulation, where different participants – e.g. from among the experts, from among the incumbents, successors and family members in each family business case were interviewed and engaged outside the interview sessions. Findings The proposed theoretical framework depicts comprehensive attributes of nurturing Chinese-Indonesian successors to continue enterprising at the helm of family SMEs. Propositions are used to explain the impacts these attributes have on transgenerational entrepreneurship specifically. At the personal level, incumbents have to focus on discovering the successors’ passions and nurture them in formal education, childhood involvement, as well as bridging them in entrepreneurial knowledge through cultural values, mentorship, autonomy and role modelling. Incumbents also had to plan for their retirements to provide autonomy for successors. At the firm/family level, incumbents must be able to set a foothold on family governance, firm governance and ownership distribution to reduce conflicts in their family businesses. Furthermore, as a minority group with past traumatic experiences, Chinese-Indonesian family SMEs usually equip themselves with contingency plans to protect their assets for the long-term future. Research limitations/implications This study was conducted in Indonesia amongst Chinese-Indonesian family SMEs and thus it is not generalisable in other settings. Literature reviews on family SMEs succession are still scant, especially on the Chinese-Indonesian. Practical implications Predecessors/incumbents of Chinese-Indonesian family SMEs could consider implementing the proposed nurturing strategies to their successors to sustain the longevity of the business based on trust, stewardship and harmony. The theoretical research framework resulted from this study offers general suggestions on how to nurture the next generation specifically from personal/interpersonal perspectives, which must be accompanied by specific scopes of family and firm aspects. This study extends beyond indicating the factors (ingredients) by explaining how to nurture transgenerational entrepreneurship (cook the ingredients) in SMEs for a tactful transition. Hence, the incumbents play vital roles and must be poised to adjust their mindsets to certain aspects indicated in this study. Social implications Most overseas Chinese businesses are family-owned, and besides Indonesia constituting the largest Chinese population outside the Republic of China, this 3 per cent of Indonesia’s people are known for controlling about 70 per cent of the economy. Furthermore, SMEs play a significant role in the Indonesian economy, as they provide about 97 per cent off the country’s employment and 57.8 per cent of the gross domestic product. Hence, the longevity of Chinese-Indonesian family SMEs must be well managed to bolster the economy and social welfare of the country. Originality/value A transgenerational entrepreneurship model in the context of Chinese-Indonesian family SMEs which incorporates the nurturing process of the successor to step up the helm of the business is proposed in the study.

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Small and Medium Enterprises (SMEs) in Indonesia are very important not only for employment creation, but also as important sources of economic growth and foreign currencies generation through exports. Since the early 1980s, the Indonesian government has adopted SME development policy through a clustering approach. This paper reviews the existing empirical studies on development of SME clusters in Indonesia. This paper deals with two main questions. First, what are the critical success factors of development of an SME cluster. Second to what extent this policy has contributed to the dynamic of SME clusters in the country. The paper argues that in many cases, the development policy has not been so successful. In essence, most failures can be attributed to the fact that one or more critical factors for successful SME cluster development were either not existing or not addressed correctly. Neglecting cluster linkage to markets is one reason of the failure. Prerequisite for successful cluster development is the cluster's potential to access to growing market, either domestic or abroad.

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The relationship between behavioural characteristics (both rational and irrational measures) and capital structure determinants has been empirically validated. This study examines the influence of the behavioural traits of overconfidence and optimism on capital structure determinations by IDX-listed public Indonesian firms’ (Tbks) management. This is statistically tested via a comprehensive hypothesis modelling construct that includes empirically validated capital structure determinants (market timing, profitability, tangibility, size and their impacts on stock price). Panel regression PLS and path analysis were performed on stock price data and financial metrics extracted from the 2013–2020 financial statements of 55 Tbks from the LQ-45 and Kompas-100 stock indices. This study found that Optimism, Market Timing and Adjusted Debt on Market Timing are not determinants of capital structure for Tbks, while Overconfidence and the control variables Firm Profitability, Firm’s Asset Tangibility and Firm Size were statistically validated as capital structure determinants. Overconfidence (as a behavioural bias) is observed to have significant negative influence on management’s capital structure determinations, while Optimism has insignificant positive influence. The less aggressive leveraged models adopted by the sampled Tbks may indicate that implemented good principles of corporate governance have played a role in preventing capital structure determinations skewed by managements’ behavioural biases or psychological tendencies.