The role of cooperative development strategy to improving the success of village cooperative (KUD) in Riau Indonesia

Abstract

PurposeThe purposes of this research are to investigate the relationship between strengths, weaknesses, opportunities and threats (SWOT) and development strategy and the relationship between development strategy and the success of Koperasi Unit Desa (KUD).Design/methodology/approachThe sample population in this research is a village cooperative (KUD) that is located in the Indragiri Hulu Regency region. Withdrawal of the sample that is selected in this research is conducted by using the random sample method that is graded proportionately. This is done because this research has a homogeneous objective (Nazir, 1983, p. 346) and the sample retrieved is as much as 31 village cooperatives (KUD). The analysis method that is used to answer the research hypothesis is path analysis, which consists of two regression equations, namely, the influence of the variables of strength (X1), weakness (X2), opportunity (X3) and threat (X4) on the development strategy (Y1) variable and the influence of the development strategy (Y1) variable on the success of village cooperative (KUD) (Y2) variable by the hypothesis that is presented in a conceptual diagram.FindingsThe SWOT variable has a significance influence on the development strategy variable in the cooperative in Indragiri Hulu Regency, Riau Province, either partially or simultaneously. And among the variables, the development strategy variable has a significant influence on the success of village cooperative (KUD) in Indragiri Hulu Regency, Riau Province. Also, it was found that the SWOT variable has an indirect influence on the success of village cooperative (KUD) in Indragiri Hulu Regency, Riau Province.Originality/valueTo the authors’ knowledge, this is the first paper to test the relation between SWOT and the development strategy and the performance of village cooperatives in Indragiri Hulu Regency, Indonesia.