The Mediating Effect of Government Policy on the Relationship Between Knowledge and Smes' Performance

Authors

  • Dorris Yadewani Department of Management, Universitas Sumatera Barat, Kol.H.Anas Malik Bypass Pariaman, Pariaman, Sumatera Barat, Indonesia, and Faculty of Business, Lincoln University College, Wisma Lincoln, No. 12-18, Jalan Ss 6/12, 47301 Petaling Jaya, Malaysia
  • Oyyapan Durai Pandi Faculty of Business, Lincoln University College, Wisma Lincoln, No. 12-18, Jalan Ss 6/12, 47301 Petaling Jaya, Malaysia
  • Amiya Bhaumik Faculty of Business, Lincoln University College, Wisma Lincoln, No. 12-18, Jalan Ss 6/12, 47301 Petaling Jaya, Malaysia
  • Sandeep Poddar Research & Innovation Division, Lincoln University College, Wisma Lincoln, No. 12-18, Jalan SS 6/12, 47301 Petaling Jaya, Selangor, Malaysia

DOI:

https://doi.org/10.48161/qaj.v3n4a146

Abstract

The primary goal of this study is to investigate the impact of knowledge on the performance of SMEs in Padang, where government policy serves as a mediator. The following are the study's specific objectives: (1) to look into the effect of knowledge on SME performance, and (2) to look into the effect of government policies on SME performance. (3) Examine the impact of government policy on the relationship between knowledge and SMEs' performance. The population in this study consists of all leaders or owners of SMEs in the field. A total of 375 samples were collected. Purposive sampling is a type of non-probability sampling. This study employs PLS-SMART to test the existing hypotheses. According to the findings of the research, (i) knowledge has a positive impact on SME performance; (ii) government policies have a positive impact on SME performance; and (iii) government policies are proven to mediate the relationship between knowledge and SME performance.

Downloads

Download data is not yet available.

References

M. Nishtar, “Financing Small and Medium Enterprises in Pakistan: Problems and Suggested Solutions.,” J. Inst. Bankers Pakistan, vol. 66, no. 1, pp. 31–52, 2000.

D. I. Kadiri, “Small and Medium Scale Enterprises and Employment Generation in Nigeria: The Role of Finance.,” Kuwait Chapter Arab. J. Bus. Manag. Rev., vol. 1, no. 9, p. 15, 2012, [Online]. Available: http://www.arabianjbmr.com/pdfs/KD_VOL_1_9/4.pdf.

N. P. Kumburu, J. F. Kessy, and S. J. Mbwambo, “Profitability of Sido Supported Small Scale Furniture Industries Againts Imported in Dar Es Salaam and Arusha Regions, Tanzania,” East African J. Appl. Sci., vol. 1, no. 2, 2019, [Online]. Available: http//www.mocu.ac.tz.

L. Al-Haddad, M. S. Sial, I. Ali, R. Alam, N. V. Khuong, and T. H. T. Khanh, “The role of small and medium enterprises (SMEs) in employment generation and economic growth: A study of marble industry in emerging economy,” Int. J. Financ. Res., vol. 10, no. 6, pp. 174–187, 2019, doi: https://doi.org/10.5430/ijfr.v10n6p174.

I. R. Maksum, A. Y. Sri Rahayu, and D. Kusumawardhani, “A social enterprise approach to empowering micro, small and medium enterprises (SMEs) in Indonesia,” J. Open Innov. Technol. Mark. Complex., vol. 6, no. 3, 2020, doi: https://doi.org/10.3390/JOITMC6030050.

V. B. Kusnandar, “Perekonomian Kota Padang Terbesar di Sumatera Barat pada 2020,” Katadata Media Network, 2021.

A. R. Fahmi, E. Hadiyati, and , A., “Pengaruh Knowledge Dan Skill Terhadap Kinerja Melalui Kompetensi Kewirausahaan Pada Pengusaha Ukm Produk Unggulan Kota Malang,” Reformasi, vol. 10, no. 1, pp. 1–10, 2020, doi: https://doi.org/10.33366/rfr.v10i1.1596.

I. D. K. R. Ardiana and I. A. Brahmayanti, “Kompetensi SDM UKM dan Pengaruhnya Terhadap Kinerja UKM di Surabaya,” J. Manaj. dan Kewirausahaan, vol. 12, no. 1, pp. 42–55, 2010, doi: 10.9744/jmk.12.1.pp.42-55.

M. S. Aliyu, “Entrepreneurial Competencies and the Performance of Small and Medium Enterprises (SMEs) in Zaria Local Government Area of Kaduna State,” Int. J. Entrep. Dev. Educ. Sci. Res., vol. 4, no. 2, pp. 116–138, 2017, [Online]. Available: http://internationalpolicybrief.org/journals/international-scientific-research-consortium-journals/intl-jrnl-of-entrepreneurial-development-vol4-no2-aug-2017.

R. L. Garnasih and D. Suryatiningsih, “Determinans of Culinary Business Perfomance,” J. Bus. Econ. Rev., vol. 5, no. 1, pp. 1–9, 2020, [Online]. Available: https://econpapers.repec.org/scripts/search.pf?ft=Determinants+of+culinary+business+performance.

D. et al Yadewani, “The influence of Entrepreneurial Orientation and skilss on Small Business Perfomance,” in AICMEST, 2022, pp. 63–66, doi: https://doi.org/10.1201/b19162-14.

D. Yadewani, “The Effect of Skills and Experience on the Performance of Small and Medium Enterprises with Innovation as Mediation Variable,” Indones. J. Bus. Entrep., vol. 9, no. 1, pp. 12–24, 2023.

D. Amelia, “Pengaruh Knowledge, skill dan ability sumber daya manusia terhadap kinerja UMKM Batu Bata di Kota Bukittinggi,” J. Ekon., vol. 22, no. 1, pp. 43–56, 2019.

P. Chaithanapat, P. Punnakitikashem, N. C. Khin Khin Oo, and S. Rakthin, “Relationships among knowledge-oriented leadership, customer knowledge management, innovation quality and firm performance in SMEs,” J. Innov. Knowl., vol. 7, no. 1, p. 100162, 2022, doi: https://doi.org/10.1016/j.jik.2022.100162.

S. Echdar, “Pengembangan kompetensi kewirausahaan SDM dan pengaruhnya terhadap kinerja usaha kecil dan menengah di Sulawesi Selatan,” vol. 17, no. 2, pp. 197–210, 2014, doi: https://doi.org/10.14414/jebav.14.1702004.

H. Purwanto and M. Trihudiyatmanto, “Pengaruh Intensi Berwirausaha, Orientasi Kewirausahaan Terhadap Kinerja Usaha dengan Motivasi Sebagai Variabel Intervening pada Sentra UMKM Carica di Wonosobo,” J. Econ. Manag. Account. Technol., vol. 1, no. 1, pp. 42–52, 2018, doi: https://doi.org/10.32500/jematech.v1i1.211.

M. Munizu, “Pengaruh Faktor-Faktor Eksternal dan Internal Terhadap Kinerja Usaha Mikro dan Kecil (UMK) di Sulawesi Selatan,” J. Manaj. dan Kewirausahaan, vol. 12, no. 1, pp. 33–41, 2010, doi: https://doi.org/10.9744/jmk.12.1.pp.33-41.

A. ; et al Zainudin, “Social business efficiency: Instruments development and validation procedure using structural equation modelling.,” Int. Bus. Manag., vol. 11, no. 1, pp. 222–231, 2017.

D. P. Wibawa, “Analysis of human resource competency as effort to increase SMEs economic sector productivity with gender as differentiating variable,” IJBE (Integrated J. Bus. Econ., vol. 2, no. 2, p. 122, 2018, doi: https://doi.org/10.33019/ijbe.v2i2.85.

F. A. Alabi, J. O. David, and Aderinto O. C., “The Impact of Government Policies on Business Growth of SMEs in South Western Nigeria,” Int. J. Manag. Stud. Soc. Sci. Res., vol. 1, no. 2, pp. 1–14, 2019, [Online]. Available: https://www.ijmsssr.org/volume 1 issue 2 March-April.html.

C. M. Stuart, Does Contracting With Small Businesses Provide a Cost Savings to the Federal Government?. 2019.

B. Hutahayan, “Factors affecting the performance of Indonesian special food SMEs in entrepreneurial orientation in East Java,” Asia Pacific J. Innov. Entrep., vol. 13, no. 2, pp. 231–246, 2019, doi: https://doi.org/10.1108/apjie-09-2018-0053.

R. Grant, “The resource-based theory of competitive advantage: implications for strategy formulation,” Calif. Manage. Rev., pp. 114–135, 1991.

J. Barney, “Firm Resources and sustained Competetive Advantage,” J. Manage., vol. 17, no. 1, pp. 99–120, 1991, [Online]. Available: https://journals.sagepub.com/toc/jom/17/1.

I. D. K. R. Ardiana and I. A. Brahmayanti, “Kompetensi SDM UKM dan pengaruhnya terhadap kinerja UKM di Surabaya,” J. Manaj. dan Kewirausahaan, vol. 12, no. 1, pp. 42–55, 2010, doi: https://doi.org/10.9744/jmk.12.1.pp.42-55.

K. Sedyastuti, E. Suwarni, D. R. Rahadi, and M. A. Handayani, “Human Resources Competency at Micro, Small and Medium Enterprises in Palembang Songket Industry,” Proc. 2nd Annu. Conf. Soc. Sci. Humanit. (ANCOSH 2020), vol. 542, no. Ancosh 2020, pp. 248–251, 2021, doi: https://doi.org/10.2991/assehr.k.210413.057.

D. R. Pramestiningrum and I. Iramani, “Pengaruh literasi keuangan, financial capital, kebijakan pemerintah terhadap kinerja usaha pada usaha kecil dan menengah di Jawa Timur,” J. Bus. Bank., vol. 9, no. 2, 2020, doi: 10.14414/jbb.v9i2.1750.

R. Mardikaningsih, E. I. Azizah, N. N. Putri, M. N. Alfan, and M. M. D. H. Rudiansyah, “Business Survival: Competence of Micro, Small and Medium Enterprises,” J. Soc. Sci. Stud., vol. 2, no. 1, pp. 1–4, 2022, doi: https://doi.org/10.56348/jos3.v2i1.21.

O. O. Fatoki, “The Impact of Human, Social and Financial Capital on the Performance of Small and Medium-Sized Enterprises (SMEs) in South Africa,” J. Soc. Sci., vol. 29, no. 3, pp. 193–204, 2011, doi: https://doi.org/10.1080/09718923.2011.11892970.

H. Sword et al., Academic Writing - Stephen Bailey, vol. 369, no. 1. 2012.

G. A. Churchill, Marketing research: Methodological Foundations., 3rd ed. New York, NY.: The Dryden Press, 1983.

R. Sekaran, U. & Bougie, Research methods for business: A skill building approach. New York: John Wiley & Sons, Inc., 2013.

A. I. Hunjra, S. Boubaker, M. Arunachalam, and A. Mehmood, “How does CSR mediate the relationship between culture, religiosity and firm performance?,” Financ. Res. Lett., vol. 39, p. 101587, 2021, doi: https://doi.org/10.1016/j.frl.2020.101587.

I. Ghozali, Structural Equation Modeling, Metode Alternatif dengan Partial Least Square (PLS), Edisi 4. Semarang. Badan Penerbit Universitas Diponogoro, 2014.

U. ; B. Sekaran, Research Methods for Business, 7th ed. John Wiley & Sons Ltd, 2016.

D. F. Fornell, C., & Larcker, “Valuating Structural Equation Models with Unobservable Variables and Measurement Error.,” J. Mark. Res., vol. 18, no. 1, pp. 39–50, 1981, doi: https://doi.org/10.2307/3151312.

J. F. Hair, A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). SAGE Publications, 2014.

G. F. Sullivan, “Using Effect Size—or Why the P Value Is Not Enough,” J. Grad. Med. Educ., vol. 4, no. 3, pp. 279–282, 2012, doi: DOI: https://doi.org/10.4300/JGME-D-12-00156.1.

F. Urbach, N., & Ahlemann, “Structural equation modeling in information systems research using partial least squares.,” J. Inf. Technol. Theory Appl., vol. 11, no. 2, pp. 5–40, 2010, [Online]. Available: Structural equation modeling in information systems research using partial least squares.

N. B. Falk, R.F. and Miller, A Primer for Soft Modeling. University of Akron Press., 1992.

J. Cohen, Statistical power analysis for the behavioral sciences. Routledge., 2013.

D. Gefen, E. E. Rigdon, and D. Straub, “An update and extension to SEM guidelines for administrative and social science research,” MIS Q. Manag. Inf. Syst., vol. 35, no. 2, 2011, doi: 10.2307/23044042.

K. C. et. a. Desouza, “Knowledge Management at SMEs: Five Peculiarities.,” J. Knowl. Manag., vol. 10, no. 1, pp. 32–43, 2006, doi: https://doi.org/10.1108/13673270610650085.

S. Ismanu and A. Kusmintarti, “Government Policies and Firm Size as a Moderating Effect of Innovation on Business Performance,” vol. 136, no. Ambec 2019, pp. 123–128, 2020, doi: https://doi.org/10.2991/aebmr.k.200415.024.

M. I. al Ibrahim, “Entrepreneurial Orientation , Technology Orientation , Contemporary Marketing and Small and Medium Enterprises (SMEs) Performance in Nigeria,” in IJMR, 2017, pp. 278–288, [Online]. Available: https://core.ac.uk/download/pdf/154353686.pdf.

Z. Ismail, M. R., & Zakaria, “The effects of entrepreneurship orientation, government support and internationalization on Malaysian SMEs performance.,” Int. J. Acad. Res. Bus. Soc. Sci., vol. 8, no. 7, pp. 453–468, 2018, [Online]. Available: https://hrmars.com/index.php/IJARBSS/article/view/4387/The-Effects-of-Entrepreneurship-Orientation-Government-Support-and-Internationalization-on-Malaysian-SMEs-Performance.

A. S. Samiadji, Abdul Manan, “Influence Of Government Regulated On Performance Business By Entrepreneur Orientation And Environment Adaptability Small Medium Enterprice Chips Industry.,” IOSR J. Bus. Manag., vol. 16, no. 11, pp. 40–45, 2014.

Published

2023-11-05

How to Cite

Yadewani , D. ., Durai Pandi , O. ., Bhaumik, A. ., & Poddar, S. (2023). The Mediating Effect of Government Policy on the Relationship Between Knowledge and Smes’ Performance. Qubahan Academic Journal, 3(4), 30–41. https://doi.org/10.48161/qaj.v3n4a146

Issue

Section

Articles