The effect of digital procurement and supply chain innovation on SMEs performance

Abstract

Technological changes accompanied by rapid market changes have made it increasingly difficult for SMEs to develop their business in the future. Today, many organizations are shifting to e-procurement as an integrated supply chain support function to achieve strategic business goals. E-procurement or electronic procurement and supply chain Innovation have allowed for more flexibility in responding to market changes and improving the performance of the company's supply chain. The purpose of this study was to determine the impact of the implementation of e-procurement and supply chain innovation on the supply chain performance of SMEs in Indonesia. The method used in this study is a quantitative survey method using structural equation modeling (SEM) and partial least squares (PLS) with data processing tools, namely SmartPLS 3.0 software. Respondents in this study were 390 employees of SMEs in Indonesia determined by the simple random sampling method. The research data was obtained through an online questionnaire distributed through social media. From the results of the analysis, it can be concluded that the implementation of e-procurement has a significant effect on supply chain performance. Supply Chain Innovation has also a significant influence on SMEs supply chain performance.