Factors Influencing Small Medium Enterprise (Sme) Performances

Factors Influencing Small Medium Enterprise (SME) Performances*

Hotniar Siringoringo

Gunadarma University

Research Department, Jl. Margonda Raya No. 100 Depok 16424, JABAR, Indonesia

Tel: +6221+7888 1112 email: hotniars@staff.gunadarma.ac.id

Dharma Tintri Ediraras

Gunadarma University

Accounting Department, Faculty of Economics, Jl. Margonda Raya No. 100 Depok 16424, JABAR, Indonesia

Tel: +6221+7888 1112 email: dharmate@staff.gunadarma.ac.id

Prihandoko

Gunadarma University

Information Technology & Computer Science Department, Jl. Margonda Raya No. 100 Depok 16424, JABAR, Indonesia

Tel: +6221+7888 1112 email: pri@staff.gunadarma.ac.id

Track: Small Business Strategy and Organization

Type of Paper: Research Paper

ABSTRACT

The objective of this research is to get empirical evidence and clarity on the phenomenon of the factors influencing small medium business’ performance.

Business performance can be influenced by envinromental factors, which can be divided into two factors, i.e., external and internal factors. The external factor consists of the macro and industrial environment, whereas internal factor consists of organizational structure, corporate culture, and resources.

The research was conducted by survey on one hundred and eighty five of SME furniture businesses in Jakarta and the cities around Jakarta. Correlation analysis was performed to test the relationship between the strategic planning and performance of SMEs.

The research result shows that there is a weak relationship between the strategic planning and the performance of SMEs, which means that environmental factors do not have a significant impact to the SME performance. This finding makes us suspect that there are other important factors that must have influenced the SME performance, such as entrepreneurship skills, business culture, etc. This will be observed in future research.

Key Words: SME, performance, strategic planning.

INTRODUCTION...