Academic journal article Journal of Management Research

Business Strategy Role as Mediation of Management Capability and Orientation of Entrepreneurship on Business Performance (A Study on Micro and Small Scale Seaweed Business in Takalar District, South Sulawesi Province)

Academic journal article Journal of Management Research

Business Strategy Role as Mediation of Management Capability and Orientation of Entrepreneurship on Business Performance (A Study on Micro and Small Scale Seaweed Business in Takalar District, South Sulawesi Province)

Article excerpt

Abstract

This study aims to examme and analyze: (1) whether the business strategy is directly influenced by management ability, entrepreneurship orientation, (2) whether business performance is influenced by management ability, entrepreneurship orientation, both directly and indirectly, through business strategy as mediation. Theoretically, the results of this research is expected to be enrich and complete the repertoire of knowledge in strategic management field, especially micro and small entrepreneurship, so it can be useful for academics, practitioners and government. The population in this study is businessman. Respondents used as sample are 82 people seaweed entrepreneurs at micro and small scale based on Law No. 20 of 2008 in Takalar District South Sulawesi Province. The sampling method is census and an analytical method used in hypothesis testing is Path Analysis. The results of this study indicate that: (1) management capability indirectly affects on business strategy, (2) entrepreneurship orientation directly influences business strategy. (3) management capability directly affects business performance 4) entrepreneurship orientation indirectly affects on business performance but through business strategy as a mediating variable (5) business strategies directly affect the performance of the business. An important finding in this study shows that: the management ability and their respective business strategies directly affect the performance of the business, while management ability and entrepreneurship orientation indirectly affect on business performance but through business strategy.

Keywords: Management capability, Entrepreneurship orientation, Business strategy, Business performance

1. Introduction

South Sulawesi Province as one of the provinces in Indonesia, as well as other province, attempts to increase incomes from various community activities through various efforts, such as encouraging micro and small enterprises from different sectors and one sector is developed the seaweed fisheries sector.

Convenient position of South Sulawesi is both as a gateway in eastern Indonesia and also as transport facilities linking smoothly the city of Makassar as the capital of the province with scattered regencies in South Sulawesi. The development of seaweed cultivation prospect other than supported by convenient location, it also has enough land resources that are still quite spacious. It is fishponds for cultivation of Gracilaria sp. and land for seaweed farming Euchema sp. approximately 59,331 hectares and furthermore, the status of seaweed cultivation in South Sulawesi has now been ousted by the local government as one of the leading commodity in the fisheries sector.

Seaweed in Takalar District is cultivated in two places, namely on pond and at sea. In 2010, for extensive fishponds with an area of 1439 hectares is managed by farmers, with production by 31,797 tons and its production value ofIDR 128,006,575,000. Meanwhile, for cultivation in the sea with an area managed by farmers is 10,436 hectares, the production amounted at 417,424 tons, and the production value is IDR 626,136,000,000. It provides an both appeals and opportunity for the businessmen at the level of micro, small, medium and large.

Fishery marketing in the Takalar District is inseparable with the South Sulawesi province, where the South Sulawesi fishery commodities are marketed for export purpose, inter-provincial and local. While micro and small seaweed entrepreneurs in Takalar Districts still market their products on the local markets which are on a large scale and industrial companies in the city of Makassar. While for Makassar city, almost entirely is marketed among the provinces like to Surabaya and Jakarta in the dried seaweed shape. Accordingly, since the seaweed is mostly done by micro and small enterprises, so that Juoro (1995) explains that small and micro businesses can be considered as the basis for the robustness of the industry structure, this is because the items products manufactured by big business is being sub working at SMEs, in addition to the selling price of SMEs products are relatively cheap (Suryana, 2003). …

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