CASSAVA Processing Industries: How to Succeed? Case in Bondowoso-Indonesia

SMEs sector showed a dominant contribution to the gross domestic product. SMEs have been able to demonstrate the contribution and the identity as the main pillar to supporting the national economy to help drive the economic recovery process in Indonesia. By improving and enhancing business performance of SMEs, it is expected that the economy would be able to run faster, more advanced, and drive economic growth better in the future. Several factors affect the business performance of SMEs is sustainable competitiveness, organizational learning, and entrepreneurial orientation. The study examines the influence of entrepreneurial orientation on organizational learning and sustainable competitiveness against changes in business performance. Population in this study is SMEs which processing of cassava into tape in Bondowoso Region, Indonesia. The data collected consists of primary data (based on field surveys). Respondents are firm leaders (the owner or manager). Each SME will be represented by one respondent. The analysis technique used structural equation model to test the hypotheses. The study found an entrepreneurial orientation influence organizational learning, entrepreneurial orientation and organizational learning have an effect and a significant positive relationship to sustainable competitiveness, and sustainable competitiveness influence business performance of tape SMEs.