MODEL DEVELOPMENT OF THE EFFECT OF INNOVATIVE PRACTICE AND PRODUCT INNOVATION ON SMALL AND MEDIUM ENTERPRISES (SMEs) MUSLIM CLOTHING PERFORMANCE IN BANDUNG

• Main Author: CYNTHIA DEWI (NIM : 23412028), ALINA
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/25380
• Institution: Institut Teknologi Bandung

<p align="justify">Innovation is necessary for the company to prevent the decline phase of their business and also to be able to compete with its competitors. Generally, SMEs tend to focus more on product innovations than on service and process innovation. Product innovation may affect SMEs performance and also can be affected by innovative practice. This study begins with a literature study and search for information related to SMEs in particular SMEs Muslim clothing in Bandung. Based on literature study and information, there are some symptoms are identified, i.e.: 1) The absence of a study evaluating the effect of innovative practice on SMEs Muslim clothing product innovation, product innovation on SMEs Muslim clothing performance, and innovative practice on SMEs Muslim clothing performance, 2) The increased of competition among SME Muslim clothing in Bandung, 3) Sales of SMEs Muslim clothing in Bandung, which tends to decline in 2012 and 2013. Based on the symptoms, the purpose of this study is: 1) To analyze the effect of innovative practice on SMEs Muslim clothing product innovation, 2) To analyze the effect of product innovation on SMEs Muslim clothing performance, 3) To analyze the effect of innovative practice on SMEs Muslim clothing performance. <br /> <br /> Data was collected using a survey questionnaire to the owners or managers of SMEs Muslim clothing in Bandung. Data collection is conducted twice, the initial data collection is needed to determine whether the questionnaire conform to the condition of SMEs Muslim clothing in Bandung were. then data was tested for its validity and reliability. Improvements was made to conform the questionnaire to the actual condition of Muslim clothing SMEs in Bandung. Furthermore, the revised questionnaire were distributed to 30 SMEs Muslim clothing in Bandung and then tested for its validity and reliability. The data is then processed by Partial Least Square Path Modelling (PLS-PM) technique and by using SmartPLS software. The results of the data processing is tested through the measurement model evaluation and structural model evaluation. Measurement model evaluation is conducted by testing the convergent validity and discriminant validity. Meanwhile, the structural model evaluation is conducted by testing the path coefficient and t statistics of variables Innovative Practices, Product Innovation, and Performance. <br /> <br /> iv <br /> <br /> The results of data processing are then analyzed. Analysis of the data processing is divided into four types, namely descriptive statistical analysis, measurement model analysis, structural model analysis, and managerial implications. Descriptive statistical analysis was conducted to determine the characteristics of the data. Measurement model analysis used to prove whether the indicator and variables are correlated each other in accordance with the existing theory. Structural model analysis of the research conducted on the main variables, namely Innovative Practices, Product Innovation, and Performance to determine the correlation between the variables of the study. Managerial implications for SMEs Muslim clothing in Bandung presented based on data processing and analysis. <br /> <br /> The results reveal the positive effect of innovative practice on SMEs Muslim clothing performance. Nevertheless, this result gives managerial implications for SMEs Muslim clothing in Bandung i.e., maintaining a good relationship with regular contact and increasing the intensity of communication with external network, conducting market research to study future fashion trends, funding employee training and education, participating in training and education, involvement of employee in generating ideas and implementing the innovation, and seeking for new ideas.<p align="justify">