Abstract

In the era of globalization today, all countries need to develop all sectors that exist in the country, including Indonesia. One of the efforts made by the government was given a chance and also develop the small and medium enterprises sector (SMEs). The purpose of this study is to see the connection of entrepreneurial leadership and good governance in the management of SMEs operational performance itself by placing business process management as mediation or intervening variable on 67 batik SMEs in Surabaya. This questionnaire analysis made by using a PLS. Entrepreneurial leadership had become an important weight in SMEs because a leader had a role as well as being an owner, which the two role is different one each other but it should be balanced .Good governance is governance which is also important in SMEs and it is related with the responsibility of SMEs over the sustainability of SMEs itself. Operational performance become a goal of management's entrepreneurial leadership and good governance that worked out to be an evaluation of planning at the future. Business process management become a thing that cannot be indivisible in the management of the SMEs, where business process management is the strategies that will be overrun by SMEs to the creation of value. Entrepreneurial leadership itself has a direct impact towards business process management and operational performance as well as good governance has a direct impact towards management business process. Unlike the previous variable, in this study business process  management does not have any influence with operational performance, where it means the business process management does not mediate entrepreneurial leadership and good governance towards operational performance. Key Word: Entrepreneurial Leadership, Good Governance, Business Process Management, Operational Performance, and Small and Medium Entreprise (SMEs)

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