Innovation has proven to be a crucial factor in the success of Small and Medium Enterprises (SMEs) amidst market uncertainties. This is highlighted in a recent study titled “SMEs Innovation Performance Based on Organizational Learning, Entrepreneurial Orientation, and Customer Capital: Case Study of Creative Industry in Central Java.” The research explores how organizational learning, entrepreneurial orientation, and customer capital contribute to enhancing innovation performance among SMEs in Central Java’s creative industry. The methodology included a survey of 100 SMEs within the creative sector, revealing that both organizational learning and entrepreneurial orientation significantly impact SMEs’ innovation capabilities. In an uncertain market environment, customer capital becomes essential for supporting innovation, particularly by aligning with consumer needs and preferences.

The study asserts that effective customer knowledge management can strengthen competitiveness. SMEs that can innovate swiftly and accurately are more resilient in adapting to market changes and sustaining their presence. In addition to organizational learning, entrepreneurial orientation has been identified as a primary driver of innovation. SMEs willing to take risks and proactively address competition are more likely to deliver superior innovations. This entrepreneurial mindset not only boosts innovation performance but also positions SMEs advantageously in a competitive market. Interestingly, the research found that the impact of organizational learning on innovation, when moderated by customer capital, was not highly significant.

The authors conclude that strengthening entrepreneurial orientation and effectively managing customer capital are strategic steps for enhancing innovation. Support from the government and external stakeholders is also critical, especially in expanding market access and bolstering the capacity of SMEs in the creative sector.

Moreover, this journal opens new avenues for further study on other influencing factors, such as human capital readiness, which may impact innovation performance in SMEs. With adequate government support and proper mentorship, creative industry SMEs hold substantial potential to grow and compete globally.

This journal thus serves as an important reference point for SMEs aspiring to innovate continually and tackle market challenges with confidence and well-thought-out strategies.

Source: Ngatno, N., Dewi, R. S., & Warsono, H. (2024, September). SMEs Innovation Performance Based on Organizational Learning, Entrepreneurial Orientation, and Customer Capital: Case Study of Creative Industry in Central Java. In 2nd International Conference on Advance Research in Social and Economic Science (ICARSE 2023) (pp. 225-234). Atlantis Press.

Author Information:

Prof. Dr. Drs. Ngatno, M.M., a faculty member in the Business Administration Department at Universitas Diponegoro, holds a bachelor’s and master’s degree from Universitas Diponegoro and a doctoral degree from Brawijaya University. Prof. Ngatno is recognized as an expert in Strategic Entrepreneurship.

Contributor: Wulan Safitri

Translator: Nur Inayah