How Do Market Orientation and Innovation Effect in Increasing Business Performance? Empire Study of MSMEs in the City of Semarang

Kesi Widjajanti () and Eviatiwi Kusumaningtyas Sugiyanto
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Kesi Widjajanti: Universitas Semarang, Department of Management, Faculty of Economics
Eviatiwi Kusumaningtyas Sugiyanto: Universitas Semarang, Department of Management, Faculty of Economics

A chapter in Proceedings of the International Conference on Business, Accounting, Banking, and Economics (ICBABE 2022), 2023, pp 186-196 from Springer

Abstract: Abstract This study aims to analyze the effect of innovation and market orientation on business performance through competitive advantage. This study focuses on analyzing the effect of innovation and market orientation on business performance through competitive advantage. This research was conducted on the culinary sector SMEs in the city of Semarang. The sample in this study is the culinary sector SMEs, amounting to 150 SMEs. The data analysis technique used in this research is path analysis. The results of the study show that the market orientation variable has a positive and significant effect on competitive advantage. The innovation variable also has a positive and significant effect on competitive advantage. Subsequent analysis shows that the innovation variable has a positive and significant effect on competitive advantage. Then the market orientation variable has a positive and significant influence on business performance. Likewise, the innovation variable also has a positive and significant influence on business performance. Meanwhile, competitive advantage also has the same result, which has a positive and significant effect on business performance. The advice that can be given in this research is that MSME actors, especially MSMEs in the culinary sector, must have sensitivity to market dynamics that are easy to change so that the products they sell can continue to sell well in the market. In addition, innovative strategies and products are needed to remain competitive in the midst of increasingly fierce business competition. This study has limitations in the selection of research objects, namely specifically for SMEs in the culinary sector. Therefore, further research can choose a wider research object.

Keywords: Business Performance; Competitive Advantage; Market Orientation; Innovation (search for similar items in EconPapers)
Date: 2023
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DOI: 10.2991/978-94-6463-154-8_18

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