Resilient MSMEs in the digital era: managing environmental uncertainty through dynamic capabilities
DOI:
https://doi.org/10.26740/bisma.v18n1.p131-158Keywords:
business resilience, digital transformation, dynamic capabilities, msme performanceAbstract
Business resilience is crucial for MSMEs to face post-pandemic challenges such as regulatory changes and economic fluctuations. Dynamic capabilities and digital transformation enable adaptation and innovation, enhancing competitiveness and sustainability, although there is still a lack of in-depth research on this relationship. This study aims to analyse the influence of environmental uncertainty on business resilience and MSME performance with dynamic capabilities and digital transformation as mediators, as well as business age as a moderating variable. This study uses primary data distributed through questionnaires with purposive sampling to 210 respondents who are MSMEs in Indonesia. Data analysis was conducted using SEM-PLS. The results of the analysis show that environmental uncertainty significantly affects dynamic capabilities, digital transformation, and business resilience, with positive coefficients for all three and a p-value below 0.05. Dynamic capabilities also have a positive impact on digital transformation and business resilience. However, dynamic capabilities do not have a significant effect on MSME performance. Both digital transformation and business resilience have a positive effect on MSME performance. In addition, dynamic capabilities moderate the influence of environmental uncertainty on digital transformation, while uncertainty through dynamic capabilities and digital transformation has a positive impact on business resilience and MSME performance. Business age does not moderate the influence of dynamic capabilities on business resilience.
References
Abdullah, S., Nawi, M. N. M., Halim, M. A. S. A., Omar, K., Rosli, N. A., & Harun, A. N. (2024). Digital transformation for sustainable business performance: a systematic literature review. UCJC Business & Society Review, 21(80), 1–15 . https://doi.org/10.3232/ubr.2024.v21.n1.02
Ali, Q. S. A., Hanafiah, M. H., & Mogindol, S. H. (2023). Systematic literature review of business continuity management (bcm) practices: integrating organisational resilience and performance in small and medium enterprises (smes) bcm framework. International Journal of Disaster Risk Reduction, 99, 104–135. https://doi.org/10.1016/j.ijdrr.2023.104135
Atanassova, I., & Bednar, P. (2022). Managing Uncertainty: Company’s Adaptive Capabilities during Covid-19. Complex Systems Informatics and Modeling Quarterly, 33, 1439. https://doi.org/10.7250/csimq.2022-33.02
Aristayudha, A. A. N. B., & Rettobjaan, V. F. C. (2022). The effect of digital transformation on business performance in denpasar msmes (case study on go-food merchant denpasar). Jurnal Ekonomi, 11(1), 383–389. https://ejournal.seaninstitute.or.id/index.php/Ekonomi/article/view/261
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/0149206391017001
Belhadi, A., Kamble, S. S., Venkatesh, M., Jabbour, C. J. C., & Benkhati, I. (2022). Building supply chain resilience and efficiency through additive manufacturing: an ambidextrous perspective on the dynamic capability view. International Journal of Production Economics, 249, 1–20. https://doi.org/10.1016/j.ijpe.2022.108516
Beuren, I. M., dos Santos, V., & Theiss, V. (2022). Organizational resilience, job satisfaction and business performance. International Journal of Productivity and Performance Management, 71(6), 2262–2279. https://doi.org/10.1108/IJPPM-03-2021-0158
Bharadwaj, A. S. (2000). A resource-based perspective on information technology capability and firm performance: an empirical investigation. MIS Quarterly, 24(1), 169–196. https://doi.org/10.2307/3250983
Bouloiz, H. (2020). Sustainable performance management using resilience engineering. International Journal of Engineering Business Management, 12, 1–12. https://doi.org/10.1177/184797902097620
Chen, J., Wang, X., Shen, W., Tan, Y., Matac, L., & Samad, S. (2022). Environmental uncertainty, environmental regulation and enterprises’ green technological innovation. International Journal of Environmental Research and Public Health, 19(16), 1–28. https://doi.org/10.3390/ijerph19169781
Corrales-Estrada, A. M., Gómez-Santos, L. L., Bernal-Torres, C. A., & Rodriguez-López, J. E. (2021). Sustainability and resilience organizational capabilities to enhance business continuity management: A literature review. Sustainability, 13(15), 1–25. https://doi.org/10.3390/su13158196
Cunningham, J., Damij, N., Modic, D., & Olan, F. (2023). MSME technology adoption, entrepreneurial mindset and value creation: a configurational approach. The Journal of Technology Transfer, 48(16), 1574–1598. https://doi.org/10.1007/s10961-023-10022-0
Ellström, D., Holtstrom, J., Berg, E., & Johansson, C. (2021). Dynamic capabilities for digital transformation. Journal of Strategy and Management, 15(2), 272–2886. https://doi.org/10.1108/jsma-04-2021-0089
Ferreira, J., Cardim, S., & Coelho, A. (2020). Dynamic capabilities and mediating effects of innovation on the competitive advantage and firm’s performance: the moderating role of organizational learning capability. Journal of the Knowledge Economy, 12(2), 620–644. https://doi.org/10.1007/s13132-020-00655-z
Ferreira, J., Coelho, A., & Moutinho, L. (2020). Dynamic capabilities, creativity and innovation capability and their impact on competitive advantage and firm performance: The moderating role of entrepreneurial orientation. Technovation, 92, 1–18. https://doi.org/10.1016/j.technovation.2018.11.004
Ghozali, I., & Kusumadewi, K. A. (2023). Partial Least Squares: Konsep, Teknik dan Aplikasi Menggunakan Program SmartPLS 4.0 untuk Penelitian Empiris (Edisi 1). Semarang: Yoga Pratama
Gligor, D., Gligor, N., Holcomb, M., & Bozkurt, S. (2019). Distinguishing between the concepts of supply chain agility and resilience: A multidisciplinary literature review. The International Journal of Logistics Management, 2(30), 467–487. https://doi.org/10.1108/IJLM-10-2017-0259
Gupta, G., & Bose, I. (2022). Digital transformation in entrepreneurial firms through information exchange with operating environment. Information & Management, 59(3), 1–65. https://doi.org/10.1016/j.im.2019.103243
Haarhaus, T., & Liening, A. (2020). Building dynamic capabilities to cope with environmental uncertainty: The role of strategic foresight. Technological Forecasting and Social Change, 155, 1–15. https://doi.org/10.1016/j.techfore.2020.120033
Hadi, H. K. (2022). Pengaruh dinamisme lingkungan dan ketidakpastian lingkungan terhadap kinerja umkm di kota mojokerto. Jurnal Ilmu Manajemen, 10(3), 902–910. https://doi.org/10.26740/jim.v10n3.p902-910
Hadi, S. (2020). New perspective on the resilience of SMEs proactive, adaptive, reactive from business turbulence: A systematic review. J. Xi’an Univ. Arch. Technol, 12, 1265–1275. https://doi.org/10.37896/jxat12.05/1524
Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2021). A primer on partial least squares structural equation modeling (PLS-SEM) (3rd ed.). Thousand Oaks, CA: Sage Publications.
Hamid, W. (2017). Growth, challenges and issues related to micro, small and medium enterprises (MSMEs) in Jammu and Kashmir. Business and Economics Journal, 8(4), 1–6. https://doi.org/10.4172/2151-6219.1000328
Han, X., Yue, B., & He, Z. (2023). Thriving in uncertainty: examining the relationship between perceived environmental uncertainty and corporate eco-innovation through the lens of dynamic capabilities. Frontiers in Environmental Science, 11, 1–17. https://doi.org/10.3389/fenvs.2023.1196997
Jain, V., Kumar, S., Soni, U., & Chandra, C. (2017). Supply chain resilience: model development and empirical analysis. International Journal of Production Research, 55(22), 6779–6800.
Kementerian Keuangan. (2023). Kontribusi UMKM dalam Perekonomian Indonesia. https://djpb.kemenkeu.go.id/kppn/lubuksikaping/id/data-publikasi/artikel/3134-kontribusi-umkm-dalam-perekonomian-indonesia.html
Khurana, I., Dutta, D. K., & Ghura, A. S. (2022). SMEs and digital transformation during a crisis: The emergence of resilience as a second-order dynamic capability in an entrepreneurial ecosystem. Journal of Business Research, 150, 623–641. https://doi.org/10.1016/j.jbusres.2022.06.048
Kim, Y., & Park, J. (2021). A structural relationship between environmental uncertainty, dynamic capability, and business performance in a smart supply chain environment. Data Science and Digital Transformation in the Fourth Industrial Revolution, 929, 13–24. https://doi.org/10.1007/978-3-030-64769-8_2
Klein, V. B., & Todesco, J. L. (2021). COVID‐19 crisis and SMEs responses: The role of digital transformation. Knowledge and Process Management, 28(2), 117–133. https://doi.org/10.1002/kpm.1660
Lenasari, R. P., Purbasari, R., & Purnomo, M. (2024). Resiliensi pada perusahaan skala usaha kecil menengah (ukm). Jurnal Bisnis Dan Kewirausahaan, 20(2), 58–67. https://doi.org/10.31940/jbk.v20i2.58-67
Magistretti, S., Pham, C. T. A., & Dell’Era, C. (2021). Enlightening the dynamic capabilities of design thinking in fostering digital transformation. Industrial Marketing Management, 97, 59–70. https://doi.org/10.1016/j.indmarman.2021.06.014
Margiutomo, S. A. S., Sundari, R., & Kuswanto, A. (2022). Strategi bertahan serta inovasi umkm jawa tengah. Jurnal Pendidikan Dan Konseling (JPDK), 4(6), 7868–7880. https://doi.org/10.47191/jefms/v7-i5-74
Mukherjee, S. (2018). Challenges to Indian micro small scale and medium enterprises in the era of globalization. Journal of Global Entrepreneurship Research, 8(1), 1–18. https://doi.org/10.1186/s40497-018-0115-5
Mushangai, D. (2023). Dynamic capabilities: Axiomatic formation of firms’ competitive competencies. Social Sciences & Humanities Open, 8(1), 1–13. https://doi.org/https://doi.org/10.1016/j.ssaho.2023.100654
Ning, L., & Yao, D. (2023). The Impact of digital transformation on supply chain capabilities and supply chain competitive performance. Sustainability, 15(13), 1–22. https://doi.org/10.3390/su151310107
Ortiz‐de‐Mandojana, N., & Bansal, P. (2016). The long‐term benefits of organizational resilience through sustainable business practices. Strategic Management Journal, 37(8), 1615–1631. https://doi.org/10.1002/smj.2410
Ozanne, L. K., Chowdhury, M., Prayag, G., & Mollenkopf, D. A. (2022). SMEs navigating COVID-19: The influence of social capital and dynamic capabilities on organizational resilience. Industrial Marketing Management, 104, 116–135. https://doi.org/https://doi.org/10.1016/j.indmarman.2022.04.009
Pasaribu, M. (2023). The influence of entrepreneurial leadership, dynamic capability, innovation, and digitalization on the performance of MSME. Al Qalam: Jurnal Ilmiah Keagamaan Dan Kemasyarakatan, 17(4), 2849–2868. https://doi.org/10.35931/aq.v17i4.2330
Peñarroya-Farell, M., & Miralles, F. (2022). Business model adaptation to the COVID-19 crisis: Strategic response of the Spanish cultural and creative firms. Journal of Open Innovation: Technology, Market, and Complexity, 8(1), 1–20. https://doi.org/10.3390/joitmc8010039
Permana, A., & Ellitan, L. (2020). The role of dynamic capability in mediating the effects of environmental dynamism and managerial capabilities on firm performance: a preliminary study. Journal of Entrepreneurship & Business, 1(2), 70-83. https://doi.org/10.24123/jeb.v1i2.2870
Pettit, T. ., Fiksel, J., & Croxton, K. . (2010). Ensuring supply chain resilience: development of a conceptual framework. Journal of Business Logistics, 31, 1–21. https://doi.org/0.1002/j.2158-1592.2010.tb00125.x
Prabowo, H., Sriwidadi, T., & Ikhsan, R. B. (2021). The influence of dynamic capability on sustainable competitive advantage: An empirical study of small businesses in Indonesia. The Journal of Asian Finance, Economics and Business, 8(6), 949–959. https://doi.org/10.13106/jafeb.2021.vol8.no6.0949
Prakash, B., Kumar, I., & Verma, J. K. (2021). Barriers and potential solutions for MSMEs in developing economies: Evidence from India. Probl. Perspect. Manag, 19(4), 325–337. http://dx.doi.org/10.21511/ppm.19(4).2021.26
Prester, J. (2023). Operating and dynamic capabilities and their impact on operating and business performance. Sustainability, 15(20), 1–24 https://doi.org/10.3390/su152015181
Putritamara, J. A., Hartono, B., Toiba, H., Utami, H. N., Rahman, M. S., & Masyithoh, D. (2023a). Do dynamic capabilities and digital transformation improve business resilience during the COVID-19 pandemic? Insights from beekeeping MSMEs in Indonesia. Sustainability, 15(3), 1–21. https://doi.org/10.3390/su15031760
Rai, S. S., Rai, S., & Singh, N. K. (2021). Organizational resilience and social-economic sustainability: COVID-19 perspective. Environment, Development and Sustainability, 23(8), 12006–12023. https://doi.org/10.1007/s10668-020-01154-6
Ratnawati, K. (2020). The influence of financial inclusion on MSMEs’ performance through financial intermediation and access to capital. The Journal of Asian Finance, Economics and Business, 7(11), 205-218. https://doi.org/ 10.13106/jafeb.2020.vol7.no11.205
Roy, K. (2020). Dynamic capability as the epistemology of an organization: a social venture context. Journal of Human Values, 26(2), 167–176. https://doi.org/10.1177/0971685819883741
Rwigema, P. C. (2020). Effect of covid-19 on micro, small and medium enterprises (MSMEs) in Rwanda. The Strategic Journal of Business & Change Management, 7(4), 1630–1655. http://dx.doi.org/10.61426/sjbcm.v7i4.1886
Saeed, S., Altamimi, S. A., Alkayyal, N. A., Alshehri, E., & Alabbad, D. A. (2023). Digital transformation and cybersecurity challenges for businesses resilience: Issues and recommendations. Sensors, 23(15), 1–20. https://doi.org/10.3390/s23156666
Sarstedt, M., Ringle, C. M., & Hair, J. F. (2021). Partial least squares structural equation modeling. In Handbook of market research (pp. 587–632). Springer. https://doi.org/10.1007/978-3-319-57413-4_15
Senadjki, A., Au Yong, H. N., Ganapathy, T., & Ogbeibu, S. (2024). Unlocking the potential: the impact of digital leadership on firms’ performance through digital transformation. Journal of Business and Socio-Economic Development, 4(2), 161–177. https://doi.org/10.1108/jbsed-06-2023-0050
Sharma, S., & Rautela, S. (2022). Entrepreneurial resilience and self-efficacy during global crisis: study of small businesses in a developing economy. Journal of Entrepreneurship in Emerging Economies, 14(6), 1369–1386. https://doi.org/10.1108/jeee-03-2021-0123
Shirooyehpour, S., Fazli, S., & Turk, K. (2022). Modeling the effect of strategic foresight on dynamic capabilities: The moderating role of environmental Uncertainty. Iranian Journal of Management Sciences, 17(65), 1–28.
Sofyan, A. T. (2021). Resiliensi dan inovasi umkm sebagai penggerak pemulihan ekonomi. Jurnal Visionary: Penelitian Dan Pengembangan Dibidang Administrasi Pendidikan, 9(2), 57–65. https://doi.org/10.33394/vis.v9i2.4828
Soja, E., & Soja, P. (2020). Fostering ICT use by older workers: Lessons from perceptions of barriers to enterprise system adoption. Journal of Enterprise Information Management, 33(2), 407–434. https://doi.org/10.1108/jeim-12-2018-0282
Souza, E. M. de M., & Pietrafesa, P. A. (2023). Leadership and digital transformation. Journal of Business Administration Research, 12(2), 9–18. https://doi.org/10.5430/jbar.v12n2p9
Subagyo, Kumar, V., & Ernestivita, G. (2020). Entrepreneurial parameters and performance of MSMEs in East Java province of Indonesia. International Journal of Business Innovation and Research, 23(2), 267-282. https://doi.org/ 10.1504/IJBIR.2020.10023765
Sudarmanto, E., Aulia, T. Z., Putri, R., & Wulandjani, H. (2023). Urgency of tax incentives in indonesia for research, development, and internationalization of MSMEs. International Journal of Multidisciplinary Approach Research and Science, 20(1), 69–82. https://doi.org/10.59653/ijmars.v2i01.339
Sunardi, R., Hamidah, H., Buchdadi, A. ., & Purwana, D. (2022). Factors determining adoption of fintech peer-to-peer lending platform: an empirical study in Indonesia. The Journal of Asian Finance, Economics and Business, 9(1), 43–51. https://doi.org/10.13106/jafeb.2022.vol9.no1.0043
Teece, D. (2017). Business models and dynamic capabilities. Long Range Planning, 51(1), 40–49. https://doi.org/10.1016/J.LRP.2017.06.007
Teng, X., Wu, Z., & Yang, F. (2022). Research on the relationship between digital transformation and performance of SMEs. Sustainability, 14(10), 1–17. https://doi.org/10.3390/su14106012
Van Hoyweghen, K., Fabry, A., Feyaerts, H., Wade, I., & Maertens, M. (2021). Resilience of global and local value chains to the Covid‐19 pandemic: Survey evidence from vegetable value chains in Senegal. Agricultural Economics, 52(3), 423–440. https://doi.org/10.1111/agec.12627
Van Vianen, A. E. M., Van Laethem, M., Leineweber, C., & Westerlund, H. (2022). Work changes and employee age, maladaptive coping expectations, and well-being: a Swedish cohort study. International Archives of Occupational and Environmental Health, 95(6), 1317–1330. https://doi.org/10.1007/s00420-021-01824-6
Westland, J. C. (2019). Structural equation models: From paths to networks. Psychometrika, 85(3), 841–844. https://doi.org/10.1007/s11336-020-09719-0
Widyanti, R., Husnurropiq, H., Anhar, D., Basuki, B., & Kurniaty, K. (2023). Kapabilitas supply chain terhadap jaringan kewirausahaan, orientasi kewirausahaan, dan kinerja UMKM. AL-ULUM: Jurnal Ilmu Sosial Dan Humaniora, 9(1), 54–66. http://dx.doi.org/10.31602/alsh.v9i1.10987
Winarsih, W., Winarti, W., Machmuddah, Z., & Tahar, E. B. (2021). The relationship between capital financial, accounting capability and micro-, small-and medium-sized enterprises’(msmes) financial performance in indonesia. Jurnal Dinamika Akuntansi dan Bisnis (JDAB), 8(2). https://doi.org/ 10.24815/jdab.v8i2.21425
Yan, B., Yao, B., Li, Q., & Dong, Q. (2022). Study on the Impact of Supply Chain Dynamic Capabilities on Long-Term Performance of Enterprises. Sustainability, 14(19), 1–18. https://doi.org/10.3390/su141912441
Yu, J., Wang, J., & Moon, T.-E. (2022). Influence of digital transformation capability on operational performance. Sustainability, 14(13), 1–20. https://doi.org/10.3390/su14137909
Yudistira, Y., Arkeman, Y., Andati, T., & Jahroh, S. (2022). A Bibliometric Review on Dynamic Capability. Indonesian Journal of Business and Entrepreneurship, 8(1), 158–158. https://doi.org/10.17358/ijbe.8.1.158
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 BISMA (Bisnis dan Manajemen)
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Abstract views: 12
,
PDF Downloads: 9
