Drivers of Innovation Ambidexterity on Small Medium Enterprises (SMEs) Performance

Werda Bagus Profityo,Iwan Inrawan Wiratmadja,Augustina Asih Rumanti

doi:10.1109/access.2020.3048139

Werda Bagus Profityo, Iwan Inrawan Wiratmadja + Show 1 more

Open Access

https://doi.org/10.1109/access.2020.3048139

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Journal: IEEE Access	Publication Date: Dec 30, 2020
Citations: 66	License type: CC BY 4.0

Affiliation: Bandung Institute of Technology, Telkom University

Abstract

The development of the broiler poultry industry has experienced a significant increase along with the increasing public demand for meat consumption. However, in 2019, many broiler poultry farmers are forced to close down their businesses because the price of broilers in living conditions continues to be below the Production Cost. Further, broiler poultry farmers also experience obstacles including unpredictable price fluctuations and intense competition. Innovation ambidexterity is the innovation capability in managing exploration and exploitation simultaneously to improve firm performance. Several influential factors in increasing innovation ambidexterity include technological capability, owner-manager characteristic, and environmental dynamism. This study aims to develop a model that describes innovation ambidexterity in broiler poultry farmers to improve firm performance. This study also analyzes the factors that can influence innovation ambidexterity and its effect on firm performance. This research mainly uses quantitative methods for its analysis. The sampling technique uses non-probability sampling with convenience sampling technique. Data collection was conducted by distributing 223 questionnaires to broiler poultry farmers in West Java. The analysis technique uses Partial Least Square - Structural Equation Modeling (PLS-SEM) which includes measurement model analysis and structural model analysis. The results of this study indicate that innovation ambidexterity has a direct influence on firm performance, while the influence of environmental dynamism on firm performance is partly mediated by innovation ambidexterity. In addition, technological capability and owner-manager characteristics have a positive influence on innovation ambidexterity and have an indirect influence on firm performance. In the near future, implications of this study will be discussed in a separate manuscript.

Highlights

The necessary of broiler poultry product in Indonesia continues to experience significant increase in every year
The purposes of this study is to explore how technological capabilities, owner-manager characteristics, and dynamic environment in developing the ability of innovation ambidexterity in broiler poultry farmers will have a positive impact on firm performance to survive in the face of environmental dynamism that occurs
This study proposes the integration of the technological capability, owner/manager characteristic, environmental dynamism, and innovation ambidexterity that have been proposed by several previous researchers to develop a model for the influence of innovation ambidexterity on the performance of broiler poultry farming in West Java in dealing with environmental dynamics

Summary

Introduction

The necessary of broiler poultry product in Indonesia continues to experience significant increase in every year. This number mostly comes from the province of West Java, which is 682 million head per year (Figure 3) where the largest population of broiler poultry is located along the northern route of Java which includes Subang Regency, Indramayu Regency and Cirebon Regency [3]

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