Skip to main content

Developing Innovation Capability to Improve Marketing Performance in Batik SMEs During the Covid-19 Pandemic

  • Conference paper
  • First Online:
Complex, Intelligent and Software Intensive Systems (CISIS 2021)

Part of the book series: Lecture Notes in Networks and Systems ((LNNS,volume 278))

Included in the following conference series:

  • 1214 Accesses

Abstract

This paper aims to examine how the role of innovation capability in improving the marketing performance of Batik SMEs in Central Java, Indonesia during the Covid-19 Pandemic. The role of innovation capability (IC) is examined by analyzing its ability to mediate the influence of market orientation (MO), entrepreneurial orientation (EO), marketing capability (MC), and operational capability (OC) in improving marketing performance (MP). The relationship between these six concepts is something that has not received serious attention from academics in Indonesia. In this study, the 200 batik entrepreneurs were involved. The results showed that IC was proven to be an intervening variable in improving MP. Furthermore, this study expects that the development of IC can improve the MP of batik SMEs in Central Java during this pandemic, so that SMEs can continue to operate and develop.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 169.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 219.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  1. Rosyada, M., Wigiawati, A.: Strategi Survival Umkm Batik Tulis Pekalongan Di Tengah Pandemi Covid-19. J. Bisnis dan Kaji. Strateg. Manaj. 4, 189–214 (2020)

    Google Scholar 

  2. Uncles, M.: Market orientation. Austr. J. Manage. 25(2), i–ix (2000). https://doi.org/10.1177/031289620002500201

    Article  Google Scholar 

  3. Protcko, E., Dornberger, U.: The impact of market orientation on business performance - The case of Tatarstan knowledge-intensive companies (Russia). Probl. Perspect. Manag. 12(4), 225–231 (2014)

    Google Scholar 

  4. Han, J.K., Kim, N., Srivastava, R.K.: Market orientation and organizational performance: is innovation a missing link? J. Mark. 62(4), 30–45 (1998). https://doi.org/10.1177/002224299806200403

    Article  Google Scholar 

  5. Narver, J.C., Slater, S.F.: The effect of a market orientation on business profitability. J. Mark. 54(4), 20 (1990). https://doi.org/10.2307/1251757

    Article  Google Scholar 

  6. Masa’deh, R., Al-Henzab, J., Tarhini, A., Obeidat, B.Y.: The associations among market orientation, technology orientation, entrepreneurial orientation and organizational performance. Benchmarking 25(8), 3117–3142 (2018). https://doi.org/10.1108/BIJ-02-2017-0024

    Article  Google Scholar 

  7. Aulia, R., Astuti, M., Ridwan, H.: Meningkatkan Kinerja Pemasaran melalui Orientasi Pasar dan Orientasi Kewirausahaan. J. Ilm. Manaj. dan Bisnis 20(1), 27–38 (2019). https://doi.org/10.30596/jimb.v20i1.2397

    Article  Google Scholar 

  8. Setyawati, H.A.: Pengaruh Orientasi Kewirausahaan Dan Orientasi Pasar Terhadap Kinerja Perusahaan Melalui Keunggulan Bersaing Dan Persepsi Ketidakpastian Lingkungan Sebagai Prediksi Variabel Moderasi (Survey pada UMKM Perdagangan di Kabupaten Kebumen). Fokus Bisnis Media Pengkaj Manaj. dan Akunt. 12(2), 20–32 (2013)

    Google Scholar 

  9. Kirca, A.H., Jayachandran, S., Bearden, W.O.: Market orientation: a meta-analytic review and assessment of its antecedents and impact on performance. J. Mark. 69(2), 24–41 (2005). https://doi.org/10.1509/jmkg.69.2.24.60761

    Article  Google Scholar 

  10. Na, Y.K., Kang, S., Jeong, H.Y.: The effect of market orientation on performance of sharing economy business: focusing on marketing innovation and sustainable competitive advantage. Sustain 11(3) (2019), https://doi.org/10.3390/su11030729

  11. Puspaningrum, A.: Market orientation, competitive advantage and marketing performance of small medium enterprises ( SMEs). J. Econ. Bus. Accountancy Ventura 23(1), 19–27 (2020)

    Article  Google Scholar 

  12. Kohli, A.K., Jaworski, B.J.: Market orientation: the construct, research propositions, and managerial implications. J. Mark. 54(2), 1 (1990)

    Article  Google Scholar 

  13. Morgan, N.A., Slotegraaf, R.J., Vorhies, D.W.: Linking marketing capabilities with profit growth. Int. J. Res. Mark. 26(4), 284–293 (2009)

    Article  Google Scholar 

  14. Morgan, N.A.: Marketing and business performance. J. Acad. Mark. Sci. 40(1), 102–119 (2012). https://doi.org/10.1007/s11747-011-0279-9

    Article  Google Scholar 

  15. Carland, J.W., Hoy, F., Boulton, W.R., Carland, J.A.C.: Differentiating entrepreneurs from small business owners: a conceptualization. Acad. Manag. Rev. 9(2), 354 (1984)

    Article  Google Scholar 

  16. Ramos-González, M., Rubio-Andrés, M., Sastre-Castillo, M.: Building corporate reputation through sustainable entrepreneurship: the mediating effect of ethical behavior. Sustainability 9(9), 1663 (2017). https://doi.org/10.3390/su9091663

    Article  Google Scholar 

  17. Martens, C.D.P., Carneiro, K.D.A., Martens, M.L., da Silva, D.: Relationship between entrepreneurial orientation and project management maturity in Brazilian software firms. Rev. Ibero-Americana Estratégia 14(02), 72–91 (2015)

    Article  Google Scholar 

  18. Lumpkin, G.T., Dess, G.G.: Academy of management review. Acad. Manag. Rev. 21(1), 135–172 (1996)

    Article  Google Scholar 

  19. Ismail, N.A.: The roles of international entrepreneur orientation and geographical scope level to determine international performance: A case in the Malaysian halal food industry. Int. J. Entrep. 20(1), 129–142 (2016)

    Google Scholar 

  20. Lumpkin, G.T., Dess, G.G.: Linking two dimensions of entrepreneurial orientation to firm performance: the moderating role of environment and industry life cycle. J. Econ. Econ. Educ. Res. 16(5), 429–251 (2001)

    Google Scholar 

  21. Wales, W.J.: Entrepreneurial orientation: a review and synthesis of promising research directions. Int. Small Bus. J. Res. Entrep. 34(1), 3–15 (2016)

    Article  Google Scholar 

  22. Nasip, S., Fabeil, N.F., Buncha, M.R., Hui, J.N.L., Sondoh Jr, S.L., Halim, D.N.P.A.: The influence of entrepreneurial orientation and social capital on the business performance among women entrepreneurs along West Coast Sabah, Malaysia. In: Proc. Int. Conf. Econ., vol. 2017, pp. 377–395 (2017)

    Google Scholar 

  23. Mohammad, I.N., Massie, J.D.D., Tumewu, F.J., Program, M.: The effect of entrepreneurial orientation and innovation capability towards firm performance in small and medium enterprises (Case Study: Grilled Restaurants In Manado). J. EMBA J. Ris. Ekon. Manajemen, Bisnis dan Akunt. 7(1) (2018). https://doi.org/10.35794/emba.v7i1.22255

  24. Vorhies, D.W., Morgan, N.A.: Capabilities for sustainable competitive advantage. J. Mark. 69(January), 80–94 (2005)

    Article  Google Scholar 

  25. Kyengo, J.M., Muathe, S.M.A., Kinyua, G.M.: Marketing capability and firm performance: an empirical analysis of food processing firms in Nairobi City County, Kenya. Strateg. J. Bus. Chang. Manag. 6(1), 544–555 (2019)

    Google Scholar 

  26. Theodosiou, M., Kehagias, J., Katsikea, E.: Strategic orientations, marketing capabilities and firm performance: an empirical investigation in the context of frontline managers in service organizations. Ind. Mark. Manag. 41(7), 1058–1070 (2012)

    Article  Google Scholar 

  27. Winter, S.G.: Understanding dynamic capabilities. Strateg. Manag. J. 24(10 SPEC ISS), 991–995 (2003). https://doi.org/10.1002/smj.318

  28. Terjesen, S., Patel, P.C., Covin, J.G.: Alliance diversity, environmental context and the value of manufacturing capabilities among new high technology ventures. J. Oper. Manag. 29(1–2), 105–115 (2011). https://doi.org/10.1016/j.jom.2010.07.004

    Article  Google Scholar 

  29. Romijn, H., Albaladejo, M.: Determinants of innovation capability in small electronics and software firms in southeast England. Res. Policy 31(7), 1053–1067 (2002)

    Article  Google Scholar 

  30. Adler, P., Shenbar, A.: Adapting your technological base: the organizational challenge. Sloan Manage. Rev. 32(1), 25–37 (1990)

    Google Scholar 

  31. Shafi, M.: Sustainable development of micro firms: examining the effects of cooperation on handicraft firm’s performance through innovation capability. Int. J. Emerg. Mark. (2020)

    Google Scholar 

  32. Calantone, R.J., Tamer, C.S., Yushan, Z.: Learning orientation, firm innovation capability, and firm performance. Ind. Mark. Manag. 31, 515 (2004)

    Article  Google Scholar 

  33. Hughes, M., Martin, S.L., Morgan, R.E., Robson, M.J.: Realizing product-market advantage in high-technology international new ventures: the mediating role of ambidextrous innovation. J. Int. Mark. 18(4), 1–21 (2010). https://doi.org/10.1509/jimk.18.4.1

    Article  Google Scholar 

  34. Neely, A., Filippini, R., Forza, C., Vinelli, A., Hii, J.: A framework for analysing business performance, firm innovation and related contextual factors: perceptions of managers and policy makers in two European regions. Integr. Manuf. Syst. 12(2), 114–124 (2001)

    Article  Google Scholar 

  35. Dela Novixoxo, J., Pomegbe, W.W.K., Dogbe, C.S.K.: Market orientation, service quality and customer satisfaction in the public utility companies. Eur. J. Bus. Manag. 10(30), 37–46 (2018)

    Google Scholar 

  36. Boso, N., Cadogan, J.W., Story, V.M.: Entrepreneurial orientation and market orientation as drivers of product innovation success: a study of exporters from a developing economy. Int. Small Bus. J. 31(1), 57–81 (2013). https://doi.org/10.1177/0266242611400469

    Article  Google Scholar 

  37. Tutar, H., Nart, S., Bingöl, D.: The effects of strategic orientations on innovation capabilities and market performance: the case of ASEM. Proc. Soc. Behav. Sci. 207, 709–719 (2015). https://doi.org/10.1016/j.sbspro.2015.10.144

    Article  Google Scholar 

  38. Akman, G., Yilmaz, C.: Innovative capability, innovation strategy and market orientation: An empirical analysis in Turkish software industry. Manag. Innov. 12(1), 139–181 (2019)

    Google Scholar 

  39. Anderson, B.S., Covin, J.G., Slevin, D.P.: Understanding the relationship between entrepreneurial orientation and strategic learning capability: an empirical investigation. Strateg. Entrep. J. 3, 218–240 (2009). https://doi.org/10.1002/sej

    Article  Google Scholar 

  40. Hauser, J., Tellis, G.J., Griffin, A.: Research on innovation: a review and agenda for marketing science. Mark. Sci. 25(6), 687–717 (2006). https://doi.org/10.1287/mksc.1050.0144

    Article  Google Scholar 

  41. Naldi, L., Nordqvist, M., Sjöberg, K., Wiklund, J.: Entrepreneurial orientation, risk taking, and performance in family firms. Fam. Bus. Rev. 20(1), 33–47 (2007)

    Article  Google Scholar 

  42. Porter, M.E.: The competitive advantage of nations. J. Multicult. Couns. Devel. (2001)

    Google Scholar 

  43. Weerawardena, J.: Innovation-based competitive strategy. The role of marketing capability in innovation-based competitive strategy, pp. 37–41 (2011)

    Google Scholar 

  44. Calantone, R.J., Di Benedetto, C.A., Divine, R.: Organisational, technical and marketing antecedents for successful new product development. R&D Manag. 23(4), 337–351 (1993). https://doi.org/10.1111/j.1467-9310.1993.tb00839.x

    Article  Google Scholar 

  45. Dutta, S., Narasimhan, O., Rajiv, S.: Success in high-technology markets: Is marketing capability critical? Mark. Sci. 18(4), 547–568 (1999)

    Article  Google Scholar 

  46. Wu, S.J., Melnyk, S.A., Flynn, B.B.: Operational capabilities: the secret ingredient. Decis. Sci. 41(4), 721–754 (2010)

    Article  Google Scholar 

  47. Muzividzi, D.K., Mbizi, R., Mukwazhe, T.: An analysis of factors that influence internet banking adoption among intellectuals: case of Chinhoyi University of Technology. J. Contemp. Res. Bus. 4(11), 350–369 (2013)

    Google Scholar 

  48. Prabowo, H., Abdinagoro, S.B.: The role of effectual reasoning in shaping the relationship between managerial-operational capability and innovation performance. Manag. Sci. Later 11, 305–314 (2021). https://doi.org/10.5267/j.msl.2020.8.002

    Article  Google Scholar 

  49. Narastika, A.A.R., Yasa, N.N.K.: Peran Inovasi Produk dan Keunggulan Bersaing Memediasi Pengaruh Orientasi Pasar Terhadap Kinerja Pemasaran. J. Ilmu Manaj. 7, 12 (2017)

    Google Scholar 

  50. Affandi, A., Erlangga, H., Sunarsi, D.: The Effect of Product Promotion and Innovation Activities on Marketing Performance in Middle Small Micro Enterprises in Cianjur (2019)

    Google Scholar 

  51. Liao, S.H., Chang, W.J., Wu, C.C., Katrichis, J.M.: A survey of market orientation research (1995–2008). Ind. Mark. Manag. 40(2), 301–310 (2011)

    Article  Google Scholar 

  52. Cravens, D.W., Piercy, N.F., Baldauf, A.: Management framework guiding strategic thinking in rapidly changing markets. J. Mark. Manag. 25(1–2), 31–49 (2009)

    Article  Google Scholar 

  53. Riswanto, A., Rasto, R., Hendrayati, H., Saparudin, M., Abidin, A.Z., Eka, A.P.B.: The role of innovativeness-based market orientation on marketing performance of small and medium-sized enterprises in a developing country. Manag. Sci. Lett. 10(9), 1947–1952 (2020)

    Article  Google Scholar 

  54. Pelham, A.N.: Market orientation and other potential influences on performance in small and medium sized manufacturing firms. J. Chem. Inf. Model. (2000)

    Google Scholar 

  55. Rhee, J., Park, T., Lee, D.H.: Drivers of innovativeness and performance for innovative SMEs in South Korea: mediation of learning orientation. Technovation 30(1), 65–75 (2010). https://doi.org/10.1016/j.technovation.2009.04.008

    Article  Google Scholar 

  56. Buli, B.M.: Entrepreneurial orientation, market orientation and performance of SMEs in the manufacturing industry: evidence from Ethiopian enterprises Bereket. Manag. Res. Rev. 40(3) (2017)

    Google Scholar 

  57. Chiva, R., Alegre, J.: Organizational learning capability and job satisfaction: an empirical assessment in the ceramic tile industry. Br. J. Manag. 20(3), 323–340 (2009)

    Article  Google Scholar 

  58. Wang, C.L.: What comes first: market or entrepreneurial orientation? Strateg. Dir. 32(10), 7–9 (2016). https://doi.org/10.1108/sd-07-2016-0110

    Article  Google Scholar 

  59. Yang, C.: The relationships among leadership styles, entrepreneurial orientation, and business performance. Manag. Glob. Transitions 6(3), 257–275 (2008)

    Google Scholar 

  60. Mitrega, M., Ramos, C., Forkman, S., Henneberg, S.C.: Networking capability, networking outcomes, and company performance: a nomological model including moderation effects. Ind. Mark. Manag. 41(5), 739–751 (2012)

    Article  Google Scholar 

  61. Karanja, S.C., Muathe, S.M.A., Thuo, J.K.: The effect of marketing capabilities and distribution strategy on performance of msp intermediary organisations’ in Nairobi County, Kenya. Bus. Manage. Strateg. 5(1), 197 (2014). https://doi.org/10.5296/bms.v5i1.5723

    Article  Google Scholar 

  62. Drnevich, P.L., Kriauciunas, A.P.: Clarrifying the conditions and limits of the contributions of ordinary and dynamic capabilities to realtive firm performance. Strateg. Manag. J. 279, 254–279 (2011). https://doi.org/10.1002/smj

    Article  Google Scholar 

  63. Lai, F., Li, D., Wang, Q., Zhao, X.: The information technology capability of third-party logistics providers: A resource-based view and empirical evidence from China. J. Supply Chain Manag. 44(3), 22–38 (2008). https://doi.org/10.1111/j.1745-493X.2008.00064.x

    Article  Google Scholar 

  64. Sabara, Z., Soemarno, S., Leksono, A.S., Tamsil, A.: The effects of an integrative supply chain strategy on customer service and firm performance: an analysis of direct versus indirect relationships. Uncertain Supply Chain Manag. 7(3), 517–528 (2019)

    Article  Google Scholar 

  65. Rosli, M.M., Sidek, S.: The impact of innovation on the performance of small and medium manufacturing enterprises: evidence from Malaysia. J. Innov. Manag. Small Mediu. Enterp. 2013, 1–16 (2013). https://doi.org/10.5171/2013.885666

    Article  Google Scholar 

  66. Aziz, N.N.A., Samad, S.: Innovation and competitive advantage: moderating effects of firm age in foods manufacturing SMEs in Malaysia. Proc. Econ. Finan. 35, 256–266 (2016). https://doi.org/10.1016/S2212-5671(16)00032-0

    Article  Google Scholar 

  67. Naranjo-Valencia, J.C., Jiménez-Jiménez, D., Sanz-Valle, R.: Studying the links between organizational culture, innovation, and performance in Spanish companies. Rev. Latinoam. Psicol. 48(1), 30–41 (2016). https://doi.org/10.1016/j.rlp.2015.09.009

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Alifah Ratnawati .

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2021 The Author(s), under exclusive license to Springer Nature Switzerland AG

About this paper

Check for updates. Verify currency and authenticity via CrossMark

Cite this paper

Ratnawati, A., Kholis, N. (2021). Developing Innovation Capability to Improve Marketing Performance in Batik SMEs During the Covid-19 Pandemic. In: Barolli, L., Yim, K., Enokido, T. (eds) Complex, Intelligent and Software Intensive Systems. CISIS 2021. Lecture Notes in Networks and Systems, vol 278. Springer, Cham. https://doi.org/10.1007/978-3-030-79725-6_30

Download citation

Publish with us

Policies and ethics