Digital Transformation as a Moderator in the Relationship between Green Entrepreneurial Orientation and Financial Bootstrapping on Financial Performance

Ahmad Nizar Yogatama; Sudarmiatin; Wening Patmi Rahayu

doi:10.55927/ajma.v3i4.11815

Authors

Ahmad Nizar Yogatama Universitas Negeri Malang
Sudarmiatin Universitas Negeri Malang
Wening Patmi Rahayu Universitas Negeri Malang

DOI:

https://doi.org/10.55927/ajma.v3i4.11815

Keywords:

Green Entrepreneurial Orientation, Financial Bootstrapping, Financial Performance, Digital Transformation

Abstract

This study examines how digital transformation can moderate the relationship between Green Entrepreneurial Orientation (GEO) and Financial Bootstrapping on the financial performance of culinary Micro, Small, and Medium Enterprises (MSMEs) in Malang City. Data was collected from 390 MSMEs in the food and beverage industry using questionnaires and analyzed using multiple linear regression and moderated regression analysis. This regression model highlights the significance of Green Entrepreneurial Orientation and Financial Bootstrapping as primary methods influencing the financial success of MSMEs. Digital Transformation as moderated is significant. To get best outcomes, MSMEs must integrate sustainability methods with financial efficiency concurrently, rather than concentrating on a singular aspect.

Downloads

Download data is not yet available.

References

Aftab, J., Veneziani, M., Sarwar, H., & Abid, N. (2024). Do green practices drive business excellence in SMEs? Investigating how green entrepreneurial orientation improves firm’s performance. Total Quality Management & Business Excellence, 35(5–6), 529–558. https://doi.org/10.1080/14783363.2024.2315442

Agustina, Y., Wijijayanti, T., Winarno, A., & Rahayu, W. P. (2023). The economarketing model: Development of productive and sustainable tourism area. International Journal of Professional Business Review: Int. J. Prof. Bus. Rev., 8(2), 5.

Al-Mamary, Y. H., Alwaheeb, M. A., Alshammari, N. G. M., Abdulrab, M., Balhareth, H., & Soltane, H. B. (2020). The effect of entrepreneurial orientation on financial and non-financial performance in Saudi SMES: A review. Journal of Critical Reviews, 7(14), 270–278.

Alshebami, A. S. (2023). Green innovation, self-efficacy, entrepreneurial orientation and economic performance: Interactions among Saudi small enterprises. Sustainability, 15(3), 1961.

Asad, M., Majali, T., Aledeinat, M., Abdelkarim Almajali, D., & Akhorshaideh, A. H. O. (2023). Green entrepreneurial orientation for enhancing SMEs financial and environmental performance: Synergetic moderation of green technology dynamism and knowledge transfer and integration. Cogent Business & Management, 10(3), 2278842. https://doi.org/10.1080/23311975.2023.2278842

Bassem, D. (2023). Green Entrepreneurial Orientation, and Environmental Performance in Family SMES Examining the Moderating Role of Perceived CSR and GI. JOURNAL OF ECONOMICS, FINANCE AND MANAGEMENT STUDIES, 06(05). https://doi.org/10.47191/jefms/v6-i5-25

den Heijer, C., & Coppens, T. (2023). Paying for green: A scoping review of alternative financing models for nature-based solutions. Journal of Environmental Management, 337, 117754.

Dika, C. W., Rita, M. R., & Sakti, I. M. (2021). FINANCIAL BOOTSTRAPPING DAN KINERJA UMKM: PERAN MODERASI LITERASI KEUANGAN. Jurnal Kewirausahaan Dan Bisnis, 26(1), 37. https://doi.org/10.20961/jkb.v26i1.44726

Fadil, N., & St-Pierre, J. (2021). Growing SMEs and internal financing: The role of business practices. Journal of Small Business and Enterprise Development, 28(7), 973–994.

Hafez, M. (2024). The Financial Compass: Navigating Market Expansion through Theory and Practice. Available at SSRN 4802279. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4802279

Huang, Y., Shih, L., & Cheng, Z. (2024). A multi‐level analysis of individual green entrepreneurial orientation: Evidence from Taiwan’s environmental protection sectors. Business Strategy and the Environment, 33(4), 3440–3462. https://doi.org/10.1002/bse.3658

Ji, H., Miao, Z., Wan, J., & Lin, L. (2024). Digital transformation and financial performance: The moderating role of entrepreneurs’ social capital. Technology Analysis & Strategic Management, 36(8), 1978–1995. https://doi.org/10.1080/09537325.2022.2118110

Jiang, W., Chai, H., Shao, J., & Feng, T. (2018). Green entrepreneurial orientation for enhancing firm performance: A dynamic capability perspective. Journal of Cleaner Production, 198, 1311–1323. https://doi.org/10.1016/j.jclepro.2018.07.104

Joshi, Y., Uniyal, D. P., & Sangroya, D. (2021). Investigating consumers’ green purchase intention: Examining the role of economic value, emotional value and perceived marketplace influence. Journal of Cleaner Production, 328, 129638. https://doi.org/10.1016/j.jclepro.2021.129638

Khan, R. U., Salamzadeh, Y., Kawamorita, H., & Rethi, G. (2021). Entrepreneurial Orientation and Small and Medium-sized Enterprises’ Performance; Does ‘Access to Finance’ Moderate the Relation in Emerging Economies? Vision: The Journal of Business Perspective, 25(1), 88–102. https://doi.org/10.1177/0972262920954604

Kiyabo, K., & Isaga, N. (2020). Entrepreneurial orientation, competitive advantage, and SMEs’ performance: Application of firm growth and personal wealth measures. Journal of Innovation and Entrepreneurship, 9(1), 12. https://doi.org/10.1186/s13731-020-00123-7

Kumar, V., Kumar, S., Chatterjee, S., & Mariani, M. (2024). Optimizing the Digital Transformation Capability for Enhancing Economic Sustainability of Entrepreneurial Venture: The Moderating Role of Entrepreneurial Orientation. IEEE Transactions on Engineering Management, 71, 8517–8530. https://doi.org/10.1109/TEM.2024.3387540

Li, Y., & Alvarado, M. (2021). The impact of financial bootstrapping techniques on perceived performance: An empirical analysis of Costa Rican SMEs. International Journal of Business Environment, 12(2), 130. https://doi.org/10.1504/IJBE.2021.115086

Lia, D. A. Z., & Fitri, R. (2023). Green Entrepreneurial Orientation and Green Innovation in SMEs: An Evidence from Systematic Literature Review and Opportunities for Future Research Agenda. Journal of Economics, Finance And Management Studies, 6(11), 11–25. https://doi.org/10.47191/jefms/v6-i11-25

Majali, T., Alkaraki, M., Asad, M., Aladwan, N., & Aledeinat, M. (2022). Green Transformational Leadership, Green Entrepreneurial Orientation and Performance of SMEs: The Mediating Role of Green Product Innovation. Journal of Open Innovation: Technology, Market, and Complexity, 8(4), 191. https://doi.org/10.3390/joitmc8040191

Mittal, V., & Raman, T. V. (2021). Examining the determinants and consequences of financial constraints faced by Micro, Small and Medium Enterprises’ owners. World Journal of Entrepreneurship, Management and Sustainable Development, 17(3), 560–581.

Novikova, I. V. (2020). Digitisation: A New Form of Precarity or New Opportunities? In V. Bobkov & P. Herrmann (Eds.), Digitisation and Precarisation (pp. 89–104). Springer Fachmedien Wiesbaden. https://doi.org/10.1007/978-3-658-26384-3_5

Oly Ndubisi, N., & Agarwal, J. (2014). Quality performance of SMEs in a developing economy: Direct and indirect effects of service innovation and entrepreneurial orientation. Journal of Business & Industrial Marketing, 29(6), 454–468.

Parmitasari, R. D. A., Indriyani, E., Rusnawati, R., Farild, M., Efendi, W., & Adawiah, A. (2023). Financial Bootstrapping and Financial Literacy: The Moderating Role of Government Support on SME Performance. Jurnal Minds: Manajemen Ide Dan Inspirasi, 10(2), 341–356. https://doi.org/10.24252/minds.v10i2.41131

Rahawarin, F. R., Soetjipto, B. E., & Wardoyo, C. (2023). Digital Transformation and MSME Financial Performance: Systematic Literature Review and Bibliometric Analysis. Economics and Business Journal (ECBIS), 1(4), 313–322.

Rahayu, C. W. E., & Rahmawati, C. H. T. (2022). Financial Management Of Msme In Culinary Industry According To Demographics And Financial Literacy. Journal of Management and Business Environment (JMBE), 4(1), 82–99.

Rambe, P., Mgudlwa, N., & Khoza, N. G. (2024). Stakeholder Management and Entrepreneurial Resourcing of Small African Firms: Financial Bootstrapping as a Cost Escalation Strategy. In Stakeholder Management and Entrepreneurship in Africa (pp. 76–87). Routledge.

https://www.taylorfrancis.com/chapters/edit/10.4324/9781003256014-8/stakeholder-management-entrepreneurial-resourcing-small-african-firms-patient-rambe-nosiphiwe-mgudlwa-nomfundo-gladys-khoza

Ren, Y., & Li, B. (2022). Digital Transformation, Green Technology Innovation and Enterprise Financial Performance: Empirical Evidence from the Textual Analysis of the Annual Reports of Listed Renewable Energy Enterprises in China. Sustainability, 15(1), 712. https://doi.org/10.3390/su15010712

Rita, M. R. (2019). Financial bootstrapping: External financing dependency alternatives for SMEs: Bahasa Inggris. Jurnal Ekonomi Dan Bisnis, 22(1), 83–100.

Rita, M. R., & Nastiti, P. K. Y. (2024). The influence of financial bootstrapping and digital transformation on financial performance: Evidence from MSMEs in the culinary sector in Indonesia. Cogent Business & Management, 11(1), 2363415. https://doi.org/10.1080/23311975.2024.2363415

Santoso, F., Sudarmiatin, S., & Wardana, L. W. (2023). Creativity in Marketing: MSMEs Innovative Steps in Attracting Consumers. West Science Journal Economic and Entrepreneurship, 1(11), 576–584.

Van Niekerk, A. J. (2024). Economic Inclusion: Green Finance and the SDGs. Sustainability, 16(3), 1128.

Wang, H., Feng, J., Zhang, H., & Li, X. (2020). The effect of digital transformation strategy on performance: The moderating role of cognitive conflict. International Journal of Conflict Management, 31(3), 441–462.

Wardhana, R. R., Anjarwani, S. E., & Agitha, N. (2023). Android-based Marketplace Development to Develop Culinary MSMEs in Mataram City. Journal of Computer Science and Informatics Engineering (J-Cosine), 7(1), 31–41.

Winborg, J., & Landström, H. (2001). Financial bootstrapping in small businesses: Examining small business managers’ resource acquisition behaviors. Journal of Business Venturing, 16(3), 235–254.

Wondirad, A., Kebete, Y., & Li, Y. (2021). Culinary tourism as a driver of regional economic development and socio-cultural revitalization: Evidence from Amhara National Regional State, Ethiopia. Journal of Destination Marketing & Management, 19, 100482.

Yaskun, M., Sudarmiatin, S., Hermawan, A., & Rahayu, W. P. (2023). The effect of market orientation, entrepreneurial orientation, innovation and competitive advantage on business performance of indonesian MSMEs. International Journal of Professional Business Review: Int. J. Prof. Bus. Rev., 8(4), 39.

Zarrouk, H., Sherif, M., Galloway, L., & El Ghak, T. (2020). Entrepreneurial orientation, access to financial resources and SMEs’ business performance: The case of the United Arab Emirates. Journal of Asian Finance, Economics and Business, 7(12), 465–474.