Abstract
Purpose Economic Society 5.0 is the answer to the challenges of the Industrial Revolution 4.0 through the creation of new value from the development of advanced technology that aims to reduce the gap between human and economic problems. Excellent human resources and adequate digital infrastructure are requirements in an Economic Society 5.0. Cooperatives as community economic organizations are players in the Industrial Revolution 4.0. Because of low competitiveness, cooperatives cannot create new and sustainable income streams, particularly digitalization capabilities. This study aims to encourage the competitiveness of cooperatives in the West Java region, Indonesia, in an Economic Society 5.0 by identifying the correlation between digital capabilities, digital orientation, employee resistance, government support, digital innovation and competitiveness. Design/methodology/approach This study uses a quantitative method through surveys as data collection techniques by distributing questionnaires to 386 leaders of cooperatives in West Java. Hypothesis testing uses analysis technique of structural equation modeling with partial least squares tool. Findings There are five hypotheses that are supported in the proposed model in this study. Digital orientation and government support have a positif and significant effect on digital innovation, in contrary; digital capability and employee resistance do not show any effect. Digital orientation, government support and digital capability also have a positive and significant effect on competitiveness. Meanwhile, employee resistance and digital innovation have no significant effect on competitiveness. Digital innovation was also found not to mediate the relationship between digital orientation, government support, digital capability and employee resistance with competitiveness. Originality/value This study provides new insights into the study of cooperatives as community’s economic institutions. This study adds empirical evidence of the factors that influence the competitiveness of cooperative institutions in Indonesia as a driver of the community’s economy. This study also provides practical implications for the development of cooperative competitiveness in developing countries, particularly in Indonesia.
Highlights
Economic Society 5.0 is an economic condition that focuses on community by providing solutions through new technologies in all industries and social activities to achieve sustainable economic development (Higashihara, 2018; Keidanren Policy and Action, 2016; Nakanishi, 2019)
It can be seen that the result of digital capabilities (DC), digital orientation (DO), government support (GS), digital innovation (DI) and CV of cooperatives was in high criteria
The moderate effect is found in the relationship between digital capability and competitiveness (f2 = 0.188), the relationship between digital orientation and competitiveness (f2 = 0.348), the relationship between government support and digital innovation (f2 = 0.228) and the relationship between government support and competitiveness (f2 = 0.201)
Summary
Economic Society 5.0 is an economic condition that focuses on community by providing solutions through new technologies in all industries and social activities to achieve sustainable economic development (Higashihara, 2018; Keidanren Policy and Action, 2016; Nakanishi, 2019). Cooperatives are business entities that play a role in strengthening the community’s economy as the basis of the national economy. The entities develop the national economy as a joint effort based on the spirit of kinship and economic democracy (Regulation of Minister of Cooperatives Number 09 of 2018, 2018). Cooperatives play a vital role in supporting the national economy, the existence and management of cooperatives in Indonesia need attention from the government to achieve the planned goals
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