Digital Proficiency and Entrepreneurial Mindset for SME Success through Market Savvy and Tech Literacy

Siti Sri Wulandari; Mohd Lizam Bin Mohd Diah; Andi Asari

doi:10.34306/att.v7i1.527

Authors

Siti Sri Wulandari State University of Surabaya https://orcid.org/0000-0002-6628-1242
Mohd Lizam Bin Mohd Diah Universiti Tun Hussein Onn Malaysia https://orcid.org/0000-0003-3333-9695
Andi Asari Universiti Teknologi Mara https://orcid.org/0000-0001-7976-1520

DOI:

https://doi.org/10.34306/att.v7i1.527

Keywords:

Market Orientation, Digital Literacy, MSMEs, WarpPLS

Abstract

Micro, Small, and Medium Enterprises (MSMEs) are vital to Indonesia economy, yet many face challenges in adapting to the digital era. This study examines the impact of market orientation on business performance, with digital literacy as a potential mediator, focusing on MSMEs in Surabaya, Indonesia. Using a quantitative approach, Structural Equation Modeling (SEM) with WarpPLS was employed to analyze data from 70 MSME owners collected through questionnaires. The results demonstrate that market orientation significantly influences both digital literacy and business performance. However, digital literacy does not mediate the relationship between market orientation and business performance, suggesting that its role is direct rather than intermediary. These findings highlight the critical importance of market-oriented strategies in driving MSME success and underline the necessity for improved digital literacy to enhance competitive advantage. MSME managers are encouraged to adopt structured customer feedback mechanisms, invest in digital training programs, and leverage market monitoring tools to better adapt to dynamic market demands. By integrating market orientation with advanced digital practices, MSMEs can achieve sustainable growth and improved operational efficiency. Future research should explore other potential mediators, such as innovation capacity or organizational culture, to better understand the dynamics of MSME performance. This study provides valuable insights into how MSMEs in mid-tier urban centers can thrive in the digital era, contributing to broader discussions on entrepreneurship and digital transformation in developing economies.

References

E. Wahyudi, S. Hariyono, A. Suharsono, G. Wicaksono, Y. Puspita et al., “Small business innovation management of export products and local government facilitation support,” in Open Society Conference, vol. 1, 2023, pp. 432–439.

A. Katadata, “Umkm serap 97% pekerja indonesia,” Databoks Katadata, 2016.

W. A. Nurasniar, “Employee performance improvement through competence and organizational culture with work motivation as a mediation variable,” APTISI Transactions on Management, vol. 6, no. 2, pp. 121–131, 2022.

Radar Surabaya, “Dampak covid-19: Umkm jatim berpotensi merugi 100 persen,” Radar Surabaya - Jawa Pos, 2024, accessed: 2024-12-24. [Online]. Available: https://radarsurabaya.jawapos.com/ekonomi/77968020/dampak-covid19-umkm-jatim-berpotensi-merugi-100-persen

T. Moorthy and S. Sahid, “The influence of digital marketing literacy on entrepreneurship behavior among public university students in malaysia,” International Journal of Academic Research in Business and Social Sciences, vol. 12, no. 1, pp. 548–568, 2022.

U. Nations, “The sustainable development goals,” 2024, accessed: 2024-02-19. [Online]. Available: https://sdgs.un.org/

N. Alqahtani, C. Uslay, and S. Yeniyurt, “Strategic performance blueprint: Optimizing business performance through tailoring strategic postures to environmental and institutional contexts,” Journal of the International Council for Small Business, pp. 1–16, 2024.

T. Hongsuchon, U. Rahardja, A. Khan, T.-H. Wu, C.-W. Hung, R.-H. Chang, C.-H. Hsu, and S.-C. Chen, “Brand experience on brand attachment: The role of interpersonal interaction, feedback, and advocacy,” Emerging Science Journal, vol. 7, no. 4, pp. 1232–1246, 2023.

N. Buratti, G. Profumo, and L. Persico, “The impact of market orientation on university spin-off business performance,” Journal of International Entrepreneurship, vol. 19, no. 1, pp. 104–129, 2021.

A. Fernanda, M. Huda, and A. R. F. Geovanni, “Application of learning cloud computing technology (cloud computing) to students in higher education,” International Journal of Cyber and IT Service Management, vol. 3, no. 1, pp. 32–39, 2023.

V. I. Mar´ın and L. Castaneda, “Developing digital literacy for teaching and learning,” in Handbook of open, distance and digital education. Springer, 2023, pp. 1089–1108.

D. Reynolds, “Using entrepreneurship education to empower students with 21st century skills,” Ph.D. dissertation, St. Thomas University, 2021.

N. C. Sakti, A. Qoiriah et al., “Experimental study on the effectiveness of using warung-kampung. com e-commerce application,” in International Joint Conference on Arts and Humanities (IJCAH 2020). Atlantis Press, 2020, pp. 347–350.

D. Wimpertiwi, F. Narindrani, and D. Hidayat, “Digital governance and intellectual property rights: Empowering indonesian smes for sustainable business growth,” in 2024 3rd International Conference on Creative Communication and Innovative Technology (ICCIT). IEEE, 2024, pp. 1–5.

E. S. Nkwei, P. Rambe, and A. Simba, “Entrepreneurial intention: The role of the perceived benefits of digital technology,” South African Journal of Economic and Management Sciences, vol. 26, no. 1, p. 4936, 2023.

S. Pandya, P. Krishna, R. Shankar, and A. Singh Bist, “Examination of the fifth-generation vehicular simultaneous wireless information and power transfer cooperative non-orthogonal multiple access network in military scenarios considering time-varying and imperfect channel state information conditions,” The Journal of Defense Modeling and Simulation, vol. 19, no. 4, pp. 723–737, 2022.

C. D. Duong, H. N. Bui, T. V. Chu, T. Van Pham, and N. D. Do, “Ict skills, entrepreneurial self-perceived creativity, and digital entrepreneurship: Insights from the stimulus-organism-response model,” Thinking Skills and Creativity, vol. 54, p. 101646, 2024.

F. N. Mahmudah, A. R. Baswedan, and S. M. Cahyono, “Digital entrepreneurship competence of vocational students,” Jurnal Pendidikan Teknologi Dan Kejuruan, vol. 29, no. 2, pp. 125–140, 2023.

Z. Zahara, Ikhsan, I. N. Santi, and Farid, “Entrepreneurial marketing and marketing performance through digital marketing capabilities of smes in post-pandemic recovery,” Cogent Business & Management, vol. 10, no. 2, p. 2204592, 2023.

A. A. Purwati, Z. Hamzah, M. L. Hamzah, and M. M. Deli, “Digital and entrepreneurial literacy in increasing students’ entrepreneurial interest in the technological era,” in International Conference on Business Management and Accounting, vol. 2, no. 1, 2023, pp. 34–43.

D. T. Siahaan and C. S. L. Tan, “What drives the adaptive capability of indonesian smes during the covid19 pandemic: The interplay between perceived institutional environment, entrepreneurial orientation, and digital capability,” Asian Journal of Business Research Volume, vol. 12, no. 2, pp. 1–20, 2022.

E. Prayitno, N. L. L. Tarigan, U. Mauidzoh, and W. E. P. Sukmawaty, “The revival of smes in indonesia from the impact of the covid-19 pandemic,” Journal of The Community Development in Asia, vol. 7, no. 2, pp. 99–114, 2024.

X. Ka, T. Ying, and J. Tang, “A conceptual model for developing digital maturity in hospitality micro and small enterprises,” Journal of Theoretical and Applied Electronic Commerce Research, vol. 18, no. 3, pp. 1511–1528, 2023.

D. Supriyanti, C. Lukita, M. D. A. Majid, A. Faturahman, I. N. Hikam, and I. K. Mertayasa, “Bibliometric insights into blockchain technology applications in digital libraries,” in 2024 3rd International Conference on Creative Communication and Innovative Technology (ICCIT). IEEE, 2024, pp. 1–6.

R. Anugrah, D. Nugroho, A. Nuche et al., “Pengaruh sistem informasi manajemen dalam pembentukan kinerja organisasi bisnis di indonesia,” Jurnal MENTARI: Manajemen, Pendidikan dan Teknologi Informasi, vol. 2, no. 2, pp. 134–141, 2024.

J. M. A. Navia, C. Parra, and J. D. Cedeno, “Digital market orientation and organizational economic performance of service smes,” Problems and Perspectives in Management, 2023.

M. L. C. Ulum, A. T. Ferdinand, F. W. Gunaldi, and N. Arifah, “From market insight to business triumph: Unraveling the role of market orientation in enhancing msmes performance,” Khazanah Sosial, vol. 5, no. 2, pp. 345–358, 2023.

G. Shoba, O. Y. Hock, and D. Yeop Ali, “Success factors of women entrepreneurs in the digital economy,” Turkish Online Journal of Qualitative Inquiry (TOJQI), vol. 12, no. 8, pp. 6015–6038, 2021.

S. S. Enciso, H. M. Yang, and G. C. Ugarte, “Skills for life series: Digital skills,” publications.iadb.org, 2024.

M. O. Erdiaw-Kwasie, M. Abunyewah, S. Yusif, and P. Arhin, “Small and medium enterprises (smes) in a pandemic: A systematic review of pandemic risk impacts, coping strategies and resilience,” Heliyon, 2023.