IEEE ICTAdoption Rev2
IEEE ICTAdoption Rev2
IEEE ICTAdoption Rev2
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Hendry Hartono
Binus University
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Abstract— The increasing number of SMEs in Indonesia has in consumer purchasing power [2], [3]. The purchasing power
become the government’s attention that determines the effect of of the baby boomer generation has helped the economy move,
ICT Adoption and Entrepreneurial Orientation on SMEs but this generation is getting older even though it is still the
Competitiveness. The purpose of this research is to examine the dominant market segment, there are other even larger
relationship between ICT Adoption, Entrepreneurial segments that consume significant amounts of consumer
Orientation and SME’s Competitiveness in Indonesia. The goods.
method used is the quantitative method by data collection using
questionnaire distribution to several SMEs from various The impact of rapid changes in consumer attitudes has
business sectors. Data processes using multiple regression encouraged every SME in Indonesia to continue to innovate
analysis performed using SPSS version 2. Data collected using in accordance with the current development and technology.
questionnaires distributed to SME’s owners that have adopted However, it is unfortunate that SMEs in Indonesia still cannot
ICT and size of samples determined by the Slovin technique. maximise their sales using internet technology. Data obtained
The result of the research stated that SMEs facing difficulties in from IBM Research said that in 2013 there were 55.2 million
adopting ICT and more concerned about the sales quantities SMEs in Indonesia, but only 75 thousand SMEs had used the
instead of product quality or market penetration and also internet for their business activities. The solution to the
require capital loan assistance to develop their businesses. problem of SMEs is to make the latest innovations that utilise
information technology in business processes by adopting ICT
Keywords— ICT Adoption, entrepreneurship orientation,
SME competitiveness
[4]. The adoption of ICT enables SMEs to improve the
efficiency and competitiveness of companies [4][5][6]. In
today's business situation, the adoption of communication
I. INTRODUCTION information technology and its impact on competitiveness
Small and Medium Enterprises (SMEs), which is the most from the results of investigations conducted in developed
significant contribution to Indonesia's economic activity countries do not always apply in developing countries because
(99.9%), others are the big enterprises that only contribute of very different economic behaviour, and usually have an
about 0.01%. The big enterprises can contribute 38.59% to unstable and chaotic environment, the education system and
Gross Domestic Product (GDP); meanwhile, SMEs, which are bad politics, and the low level of industrialization, including
almost 99.99%, only contribute to Gross Domestic Product development.
about 61.41%. This shows that MSMEs themselves still have Reports from the Indonesian Employers' Association
potential to increase their business so that the contribution (APINDO) in 2012 stated that first, the entrepreneurial
more to the GDP. During 2014 to 2016 there was a production capabilities of SME entrepreneurs were still low in product
growth of SMEs and big enterprises. In 2014, the SMEs innovation. Second, the level of expertise is still inadequate in
production index reached 122.91, the next two years rose to solving organisational and business management issues so
137.43, or up by 11.81%. Compared to production growth that they are unable to carry out business activities efficiently,
over the past 3 years that consistently increases by 5% per effectively and flexibly. Third, networking is still limited, thus
year. Meanwhile on the other hand, the large enterprises hampering access to information, markets and inputs
production index in 2014 reached 120.36 and the next 2 years compared to SMEs in other countries. Fourth, connectivity is
rose to 131.15, thereby increasing by 8.96%, but the growth still minimal so it cannot exploit both national and regional
of big enterprises production does not always increase markets. Finally, lack of financial access cause business
consistently as SMEs. The development of SMEs in Indonesia development limitation to a larger scale. This weakness not
is relatively low at current prices ranging from 8.4% to 14.8% only inhibits the growth of SME performance but also
while inflation is between 9.2% to 12.6%. Similarly, turnover weakens the competitiveness of SMEs [7], [8]. Entrepreneurs
growth is only between 11.3% to 18.2% and profit growth is need entrepreneurial capabilities while running a business.
only between 10.9% to 15.3% [1]. One of the things that were assessed is the Entrepreneurship
Capital and market access is one of the causes of the low Orientation. Entrepreneurship orientation is the willingness of
level of competitiveness of SMEs in Indonesia. Indonesia has organizations to find and accept new opportunities and take
the lowest level compared to other countries in the Asia- responsibility for influencing change [9].
Pacific region. The problem of the low competitiveness of Indonesian government assisted SME so they can well
SMEs in Indonesia requires entrepreneurs to face various compete in the future market. Increasing the competitiveness
challenges to improve his position in the competitive global of SMEs is reflected in the policy decision of the Minister of
market. The challenges are caused by continuous Cooperatives and SMEs No. 71 year 2000, concerning
technological developments which certainly creates changes
A. Data Analysis
TABLE III. DESCRIPTIVE ANALYSIS OF ENTREPRENEURSHIP
Test results indicates that all the 24 indicators are valid ORIENTATION
(above Rtable 0.16) and reliable (above 0.6 of Cronbach’s
Alpha), thus can be proceed to the next step of analysis. Std. Mean per
Indicator Mean
Dimension Deviation Dimension
Creativity 0,805 4,35
TABLE I. RELIABILITY TEST Innovation 4,27
Packaging
Variable Cronbach’s Alpha Remark Ideas 0,856 4,19
Based on the respondent’s opinion, the lowest position of TABLE VII. REGRESSION TEST RESULT (MODEL 3)
the mean of Competitiveness (Y) variable is financial
Coefficientsa
dimension requires assistance from external parties such as
Unstandardized Standardized
capital loan assistance to develop business. For indicators with Coefficients Coefficients
Model t Sig.
the lowest mean, namely Competitive Price indicators in the
B Std. Error Beta
Marketing dimension because for some SMEs, it is important
(Constant) 1.766 .448 3.939 .000
to increase the profit by higher price. SME believe that who
3 ICT Adoption .150 .107 .143 1.407 .163
set lower prices than their competitors can cover the capital
Entrep. Orientation .403 .107 .384 3.773 .000
issued. For the indicator with the highest mean is the indicator
a. Dependent Variable: Competitiveness
of Cost Control in the Marketing dimension, some SME
believe that are able to control costs by using marketing media The statement of the third hypothesis that the Adoption of
that require less cost. ICT and Entrepreneurship Orientation on the Competitiveness
of SMEs proved to be influential. Competitiveness is
C. Regression Analysis influenced by the Adoption of Information Technology
Communication and Entrepreneurial Orientation (Ftest 13.898
> Ftable 3.09), means that the Adoption of ICT and
Initial testing was conducted by using SPSS version 22 to Entrepreneurship Orientation influences the Competitiveness
test the hypothesis, as follows: of SMEs.