THE RELATIONSHIP BETWEEN ENTREPRENEURIAL ORIENTATION, MARKET ORIENTATION AND SMEs PERFORMANCE: THE MEDIATING ROLE OF THE MANAGEMENT SKILLS, IN SOUTH SUMATRA, INDONESIA

Abstract

Small and medium-sized enterprises (SMEs) can partly preserve their viability by enhancing performance. The primary concern is how to improve the performance of SMEs to facilitate their growth. Therefore, this research aims to investigate the factors that enhance SME performance. An empirical investigation was conducted in South Sumatra, Indonesia, to verify the hypothesis. This investigation collected 109 valid questionnaires from SME business people via a self-administered survey. In addition, the data were analysed using Partial Least Square-Structural Equation Modelling (PLS-SEM). According to the findings, there was a relationship between entrepreneurial orientation (EO), market orientation (MO), and SME performance. The effect of EO on SMEs performance is accepted, while the hypothesis of management skills (MS) as a mediating is accepted. Nonetheless, several results of the MS hypothesis as a mediating enhancing the effect of MO on the performance of SMEs were rejected. The efficacy of SMEs in South Sumatra, Indonesia, is the subject of research that informs future decisions.