Implementation of Strategic Flexibility in SMEs of Snack Industry for Capacity Optimization. Is it possible?

Abstract

The Government of Indonesia is currently paying great attention to the development of the national economy that puts forward MSMEs. In this MSMEs' development effort, the academic community formed an activity called Business Coaching. Business coaching is now closely related to the empowerment of Micro Small and Medium Enterprises (MSMEs). MSMEs are believed to have a significant role in national economy by contributing to the gross domestic product (GDP) and decreasing labor. With this capability, MSMEs become the economic pillar of a superior government. In dealing with contributing in GDP, the MSMEs' business actors must be able to implement its business strategy more flexibly in order to survive in the face of competition. Karin Kukis's experience in responding to the holiday demand was not good. They produced dry cakes with insufficient amount. Karin Kukis felt that their production capacity was not optimal, so they were unable to meet the demand so that their target was not achieved. Therefore, a business strategy is needed to sustain Karin Kukis' business. In response to these challenges, Karin Kukis operates a flexible business strategy. Strategic flexibility is the ability of a company to respond to variations in demand from a competitive and dynamic market environment [2]. In the face of this uncertain market demand, Karin Kukis will improve its production capacity so that Karin Kukis can achieve capacity optimization, compete with other competitors, and achieve the goal of increasing revenue from sales.