HOW TO UTILIZE COMPANY RESOURCES OPTIMALLY TO IMPROVE BUSINESS PERFORMANCE

Abstract

Objective: This research aims to examine the influence of company resources on digital innovation and business performance, as well as the influence of digital innovation on business performance, both directly and as mediation, among members of the Telkom Indonesia MSME Digital Market (PaDi).   Theoretical Framework: This research is based on the interconnectedness of company resources, digital innovation, and business performance in the MSME sector.   Method: This research is quantitative research through surveys of companies that are members of the Telkom Indonesia UMKM Digital Market (PaDi). The total sample was 400 respondents taken using stratified random sampling technique. The questionnaire is prepared with a rating scale from 1 to 5 points. Data processing and analysis used structural equation modeling with Lisrel 8.5 software.   Results and Discussion: The results of this research also provide managerial implications, especially for MSME players who are members of the Telkom Indonesia Digital Market (PaDi) to prioritize the development of digital innovation through continuous learning of user behavior that appears in the market, which needs to be supported by learning about developments in digital technology, as well as supported by an effective coordination mechanism. In developing digital innovation, companies need to prioritize ownershipinformation resources in accordance with market and technology developments, followed bythe ability to build organizational business relationships/networks and HR capabilities to innovate.   Research Implications: The results of this research provide theoretical implications in the form of developing knowledge regarding the interconnectedness of company resources, digital innovation, and business performance in the MSME sector.   Originality/Value: This study contributes to the literature by highlighting the critical role of company resources in driving digital innovation and improving business performance in MSMEs. The relevance and value of this research are evidenced by its potential impact on guiding MSME players towards effective digital innovation strategies for business success.