The Socio-Cultural Digital Innovation Capacity for Business Competitiveness of Traditional Craft SMEs in Makassar

Harry Yulianto; Rohani Rohani; Jumarti Jumarti

Authors

Harry Yulianto Management Program Study, Sekolah Tinggi Ilmu Ekonomi YPUP Makassar, Jl. Andi Tonro No. 17, Makassar, Indonesia
Rohani Rohani Management Program Study, Sekolah Tinggi Ilmu Ekonomi YPUP Makassar, Jl. Andi Tonro No. 17, Makassar, Indonesia
Jumarti Jumarti Management Program Study, Sekolah Tinggi Ilmu Ekonomi YPUP Makassar, Jl. Andi Tonro No. 17, Makassar, Indonesia

Keywords:

Business Competitiveness, Traditional Craft SMEs, Digital Innovation, Socio-Cultural Preservation

Abstract

Traditional craft Small and Medium Enterprises (SMEs) in Indonesia, particularly in Makassar, face an existential challenge in the digital era: balancing cultural preservation with the need to adopt digital technology for business competitiveness. This study aims to test the influence of the Socio-Cultural Digital Innovation Capacity (SCDIC), comprising Adaptive Digital Literacy (X1), Socio-Cultural Preservation (X2), and Collaborative Governance (X3), on the Business Competitiveness (Y) of these SMEs. Using a quantitative explanatory approach, data were collected through a survey of 350 respondents selected via stratified random sampling. Multiple linear regression analysis revealed all three SCDIC dimensions have a significant positive effect on business competitiveness, both partially and simultaneously. The model demonstrates strong predictive power, with an R-Square value of 0.75. Socio-Cultural Preservation was found to have the strongest influence (β=0.34), followed by Collaborative Governance (β=0.33) and Adaptive Digital Literacy (β=0.32). The study concludes an integrated approach, synergizing adaptive digital capabilities, socio-cultural preservation, and multi-stakeholder collaboration, is crucial for building sustainable competitive advantage for traditional craft SMEs in the digital transformation era.

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