Towards Longevity: Managing Innovativeness in Family Micro-Small-Medium Enterprises

Jacob Donald Tan,Masduki Asbari,John Tampil Purba,Agus Purwanto

doi:10.17358/ijbe.8.1.70

Jacob Donald Tan, Masduki Asbari + Show 2 more

Open Access

https://doi.org/10.17358/ijbe.8.1.70

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Abstract

This article explains the family and business strategies that the Micro-Small-Medium Enterprises (MSMEs) implement to dodge the ability-willingness paradox. The majority of the MSMEs in the metropolitan region of Jakarta are in their comfort zone. Only 15.90% utilize the Internet and 8.53% utilize the computer. According to the researchers' survey, most family businesses highlighted business longevity and emphasized the importance of technology and information. However, family MSMEs are still trapped in the ability-willingness paradox despite recognizing the importance of innovation. This study sampled five family MSME cases that are considered sustainable due to their innovativeness. It then investigated them by in-depth semi-structured interviews, observations, and field notes to explore how they strategize to employ innovativeness. The results signify the founders’/incumbents’ receptiveness towards innovations in the business. It also signifies the stakeholders’ contributive insights and the imposition of operations systemization. These findings stipulate the fundamentals for families in their MSMEs to engage in innovative activities that influence the longevity of their firms. This study concludes by recommending avenues for future research. Keywords: family business, micro-small-medium enterprises, innovativeness, strategy, case studies

Highlights

According to the Ministry of Communications and Informatics in Indonesia and Directorate General of Taxes (IndonesiaBaik.id, 2018), micro-small-medium enterprises (MSMEs) comprise 98.8% of all businesses contributing 60.3% to the Indonesian economy and about 97% of employment in 2018
Even in metropolitan areas like Jakarta, most MSMEs are in their comfort zone: Only 15.90% are utilizing the Internet, and 8.53% are utilizing the computer (Bidang Neraca Wilayah dan Analisis Statistik BPS Provinsi DKI Jakarta, 2016)
Considering the firm size of family MSMEs, the researchers in this study explore the emerging paradox that alludes to the development of innovation strategy

Summary

Introduction

According to the Ministry of Communications and Informatics in Indonesia and Directorate General of Taxes (IndonesiaBaik.id, 2018), micro-small-medium enterprises (MSMEs) comprise 98.8% of all businesses contributing 60.3% to the Indonesian economy and about 97% of employment in 2018. Even in metropolitan areas like Jakarta, most MSMEs are in their comfort zone: Only 15.90% are utilizing the Internet, and 8.53% are utilizing the computer (Bidang Neraca Wilayah dan Analisis Statistik BPS Provinsi DKI Jakarta, 2016). It provides a notion that sustainability/continuity is the main concern of the founders/incumbents (Table 1). They acknowledge the critical role of technology and information in their family businesses (Table 2). This survey commenced by sending closed-ended questionnaires via email to 198 respondents, with 82 of them responding. PricewaterhouseCoopers (PwC, 2018) indicated that to innovate to keep ahead is still one of the key issues and challenges faced by Indonesian family businesses

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