Model Keterkaitan Market Orientation, Leadership, Organizational Innovation dan Organizational Performance pada Industri Kerajinan di Sumatera Barat

Abstract

Small and Medium Enterprises (SMEs) play a crucial role in the economic development in terms of the Gross Domestic Product's contribution, society empowerment as well as unemployement reduction. The aim of this research is to analyze the influence of market orientation and transformational leadership towards organizational innovation and organizational performance for SMEs, especially among the creative industry in West Sumatera (Bukittinggi, Pariaman, Padang Pariaman, and Pesisir Selatan). This research uses purposive sampling techniques to 86 SMEs of handicraft as sample size. The criteria are assigned to the respondents is the handicraft which produce as well as market its products. The data are analyzed using Structural Equation Modeling (SEM) with SmartPLS software. The quantitative result of this study shows that transformational leadership has a significant positive effect on the organizational performance. Market orientation reflected by three dimensions including customer orientation, resources orientation, and competitor orientation also has a significant positive effect on the organizational innovation and organizational performance. However, organizational innovation is not able to provide a significant positive effect on organizational performance. Among all the variables, market orientation has the strongest influence on organizational innovation and organizational performance. Due to the lack of organizational innovation in order to increase the SMEs performance, the study therefore recommends the SMEs managers should embrace on market orientation to support their business accordance with market trends.

Dimensions of Learning Orientation and Its Impact on Organizational Performance and Competitiveness in Smes

“…Regarding the results of LO dimensions with organizational performance, the findings are similar to the studies of Pérez et al (2005); Cardona and Calderon (2006); Araiza et al (2014); Gálvez et al (2013); Calantone et al (2002); Lita and Faisal (2018); Hussein et al (2014); Mahmoud and Yusif (2012). Bature et al (2018), who point out a positive influence between LO and performance without making a distinction in the impact on the different dimensions as was the case in this study.…”

“…The empirical review of the relationship of LO and organizational performance, have supported this positive influence (Lita & Faisal, 2018;Hussein et al, 2014;Mahmoud & Yusif, 2012). Bature et al (2018) notes that commitment to learning, shared vision and open-mindedness, clearly show how small and medium enterprises can create and use skills, knowledge and technically they know how to extend strong capabilities that result in superior performance.…”

“…For Baba (2015), LO is a collective capacity derived from the cognitive and experiential process and involves the acquisition, exchange and use of knowledge. In the same way, Liao et al (2017) defined the LO as an organizational process to improve individual knowledge by transforming it into part of the knowledge system of the organization, in an organized and understandable way as well as the commitment to learning, open-mindedness and shared vision (Lita & Faisal, 2018).…”

“…LO has been considered as a variable that supports or moderates the relationship between entrepreneurial orientation (EO) and market orientation (MO) with performance, that is, as part of a combination with diverse strategic orientations to achieve a better performance (Dutta et al, 2016). The adoption of LO can lead to performance as team members can learn about the organizational environment, being the main determinant in the performance of the business (Real et al, 2014;Lita & Faisal, 2018), since they accept the criticisms and suggestions of the customers (Mahmoud et al, 2016).…”

“…The commitment to learning must be seen, both by managers and employees, as a value that generates competitive advantages in the organization, a shared vision explains us that managers are responsible for the LO in their organization. Finally, it is important to highlight that in an open-mindedness culture, employees see themselves as partners, they communicate freely and managers know how to interpret it (Lita & Faisal, 2018). LO creates conditions of improving organizational competitiveness, due to it increased the adaptability of the company, allowing the individuals to take advantage of the opportunities detected with cognitive mechanisms based on learning (An et al, 2017;Mahmoud et al, 2016;Wolff et al, 2015).…”