Exploring market orientation, product innovation and competitive advantage to enhance the performance of SMEs under uncertain evens

Abstract

The purpose of this study is to build an empirical research model and prove the influence of market orientation on product innovation and competitive advantage. The study also proves the intervening role of product innovation and competitive advantage on increasing market performance. In addition, market uncertainty is also tested in moderation in strengthening the relationship between product innovation and competitive advantage in market performance. The study tests 178 samples of Batik SME players in Surakarta. A purposive sampling was used as this research’s sampling method. The result of this study proves empirically that market orientation positively, significantly influences product innovation and competitive advantage. The test of mediation role between product innovation and competitive advantage in market performance also shows positive and significant results. The result of the test on moderation role between Market uncertainty in the relationship between product innovation and competitive advantage on market performance also shows positive and significant influence on market performance.