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International Journal of Basic & Applied Sciences IJBAS-IJENS Vol:19 No:02 45
190702-8484- IJBAS-IJENS @ April 2019 IJENS I J E N S
The Influence of Business Capital, Changes in the
Business Environment, Entrepreneurship Character
and Company Performance on Corporations Small
and Medium Enterprises in Palasah Village, Palasah
District, Majalengka Regency,
West Java Province Suyanto
Doctoral Program of Economic Trisakti University – Jakarta
Email : [email protected]
Abstract-- Seeing the journey of small businesses as one of the
parts of the lower classes of society, has a role in national
development, which has prospects to be developed, it is very
necessary to get a better touch of development so that they have
more power to realize their goals, because in reality the sector
those who are very close to small people are still far from
"professionalism" and the continuity of their business is still in
place. Realizing the reality that exists in empowering small
businesses is very much needed, it is necessary to have an
empowerment process that aims to empower the community to
improve their standard of living, optimize local resources as well
as possible, both natural resources and human resources. The
basis of the empowerment process is the experience and
knowledge of the community about its vast and useful existence
and their willingness to be better. Furthermore, the hope of this
empowerment process is the realization of a dignified society and
increasing awareness of their rights and obligations, by adhering
to the rules regarding what is right and what is not, what is
permissible and what cannot be done, including developing
cultured behavior. The development of the number of small-scale
business units over the period of 2012 to 2015 showed an average
growth of 5.41% or grew 1.15 million units annually, from 42.40
million units (2012) to around 44.69 million units in in 2015. Even
though the average growth of small and medium enterprises
(SMEs) is 5.41%, which is slightly smaller than the growth of the
average medium business which reaches 6.64%, but
quantitatively small businesses greatly affect the economic
activities of many people because the amount is 99.8% of all
business people in the country. This research belongs to the type
of Descriptive Studies and analytic quantitative research.
Sampling used the proportionate stratified random sampling
technique with a sample of 488 or 100 populations and data
analysis with simple and multiple linear regression. The business
world that is now starting to develop following its civilization is
expected to be able to answer the challenges of the economy in
society that exist today, because society is a group of human life
that has a different role of diversity and culture in a
development, or follows the flow of times in a community that are
interconnected and mingling with each other, with all activities in
a tolerant manner and with a contradictory relationship that
daily can provide the sentences, as well as providing enthusiastic
applications-adaptations and as well as can minimize a good and
bad actions, and have interpretations the interpretation of
scientific knowledge and towards thinking of prosperity, peace,
and being able to think has a sense of peace and security, in the
solidarity of citizenship, nationality, and state relations, this
opinion was conveyed by Adi Suminto (2017. Pg. 16) Book: Social
Existence on Community Diseases In the Perspective of Human
Rights, says that "Society is an example in history by emphasizing a
process naturally in the character of science (Social) to answer
solving various problems of life". So with that economics is one of
the fractions in character and its social literature as a basis or
mother rather than other sciences. Conclusions: (1) The
Influence of Business Capital has a positive and significant
influence (76.8%) on corporations Small and Medium
Enterprises in Palasah Village, Palasah District, Majalengka
District, West Java Province, Influence of Business Capital is a
reinforcing factor of corporate. Small and Medium Enterprises
corporations in Palasah Village, Palasah District, Majalengka
District, West Java Province, (2) Changes in the Business
Environment for Small and Medium Enterprises corporations in
Palasah Village, Palasah District, Majalengka District, West Java
Province has a positive and significant influence (75.8%), because
Business Environment Change is a reinforcing factor of
corporations Small and Medium Enterprises in Palasah Village,
Palasah District, Majalengka District, West Java Province has a
positive and significant influence (72.2%), The corporations
Small and Medium Enterprises in Palasah Village, Palasah
District Majalengka Regency, West Java Province,
Entrepreneurship Character is the main factor of UKM
corporations in Palasah Village, Palasah District, Majalengka
District, West Java Province, (4) Company Performance of the
corporations Small and Medium Enterprises in Palasah Village,
Palasah District, Majalengka District, West Java Province has a
positive and significant influence (90,6 %), Company
Performance is a supporting factor of the corporations Small and
Medium Enterprises in Palasah Village, Palasah District,
Majalengka District, West Java Province, (5) Influence of
Business Capital, Changes in Business Environment,
Entrepreneurship Character and Corporate Performance
together have a positive influence and significant (68.2%), for
corporations Small and Medium Enterprises in Palasah Village,
Palasah District, Majalengka Regency, West Java Province. Key
Words: Business Capital, Changes in the Environment,
Entrepreneurial Character, Company Performance, and Small
and Medium Enterprises Corporations.
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190702-8484- IJBAS-IJENS @ April 2019 IJENS I J E N S
CHAPTER I PRELIMINARY
I.1. Background. Business people today must understand the
economic cycle of the region, for example in Palasah Village,
Palasah Sub-District, Majalengka District, West Java
Province, the community knows and recognizes economic
resources for economic sector development and bottom-level
welfare, starting with the creation of community employment
business or corporate business entrepreneurship "PT. Binhara
Inti Nusa" as a form of an individual limited liability company
(PT) with the category of "National Private" company
abbreviated as "PT. BIN" in order to build civilization in
people's welfare in the area of regional economy in
strengthening national resilience by realizing lower level
sectoral welfare. Basic suitability of Law Number 40 of 2007
concerning Limited Liability Companies. This company is PT.
Binhara Inti Nusa has a program in its vision and mission
including: 1. Creating jobs 2. Reducing unemployment 3.
Alleviating poverty 4. Realizing prosperity in the pillars of
national security 5. Building the people's economy. The five
programs owned by this company will be able to break the
spirit of business people / entrepreneurship in other limited
liability companies, to be able to practice social change,
develop civilization development work and work on the
pattern of each field that will be cultivated as the contact's
main goal itself. In principle, there are 3 conditions for
establishing a Limited Liability Company (PT) as stipulated in
Law No. 40 of 2007 concerning Limited Liability Company
(UUPT): First about the founders; second, about the basis of
establishment; and third, about capital. The description is as
follows: A. About the Founder. Limited Company (PT) must
be established by at least 2 people, and made by notary deed in
Indonesian. Because basically, the Company is established
based on an agreement, so that it must have more than 1 (one)
shareholder / founder. The definition of "person" here, is an
individual, both Indonesian and foreign citizens or an
Indonesian or foreign legal entity (see Explanation of Article 7
paragraph 1 of the Company Law). If the conditions of the two
people are not fulfilled, it will result in changes in the
responsibility of the company, which in fact is limited to
unlimited liability. This means that all commitments and
losses of PT are the responsibility of the founder personally.
B. About the Foundation. Limited Liability Company (PT)
must be established with an authentic deed before a notary.
This authentic deed contains the Articles of Association and
other information relating to the establishment of PT (see
Article 8 of the PT Law), and must be approved as a legal
entity from the Minister of Law and Human Rights, then must
be registered in the company list to the relevant department as
stipulated in Law No. 3 of 1982 concerning the Obligatory
Registration of Companies Jo Article 29 Paragraphs 1 to 6 of
the Company Law. C. About Capital. Based on Article 32
Paragraph 1, the Limited Liability Company (PT) Limited
Liability Company Law is Rp. 50,000,000 (fifty million
rupiah). But since the issuance of Government Regulation No.
29 of 2016 concerning Amendments to the Limited Liability
Company, the minimum authorized capital of the limited
liability company (PT) is deviated so that there is no minimum
authorized capital limited liability company (PT). So the
matter of the amount of authorized capital (PT), submitted to
the agreement of the parties (Founder of Limited Liability
Company) want to enter any capital, which is stated in the
Deed of Establishment of Limited Liability Company (see
Article 1 Paragraph 2 and 3 PP No. 29/2016). Examples of
Limited Liability Companies (PT. Binhara Inti Nusa). This
limited liability company was established on the 27th of
December of 2011 and received approval from the Minister of
Law and Human Rights of the Republic of Indonesia Number
AHU - 0010868.AH.01.09. 2012. On February 8, 2012. With
the classification of businesses in General Trade, Services,
Development, Transportation and Telecommunications as well
as Export and Import. As well as opening a branch office in
Majalengka Regency, based on the Certificate of Business
Domicile (Managing Director of the Company) Palasah
Village Number: 140/11 / Dec. April 2, 2012 and Registrar of
Palasah District Reg. No. 470/59 / Kec. And Certificate of
Business Domicile (Director of Company Branch) Palasah
Village Number: 140/96 / Des. November 8, 2012 and
Registrar of Palasah District Reg. No. 300/11 / Trantib. And
the Medium Trading Business License (SIUP) as the Head
Office of the Company is approved by the DKI Jakarta UKM
and Trade Cooperative Office Number: 03133 - 02 / PM /
1,824,271. February 28, 2012 Legalization of a Trading
Business License (SIUP) Branch that was approved by
BPPTPM Majalengka Regency Number: 517 / 37-PM.Cab /
II-BPPTPM / 2012. November 7, 2012. Company Registration
Number (TDP) Company Head Office Number:
09.01.1.82.37776. March 8, 2012. Permit for Company
Registration (TDP) as the Company's Branch Office approved
by BPPTPM Majalengka Regency Number: 102318209512.
November 14, 2012. Construction Services Business License
(IUJK) from BPTSP DKI Jakarta Province as Company Head
Office Number: 1-905597-3175-2-00683. May 26, 2015
(having experienced Her Register in 2012, 2013, 2014).
National Construction Services Business License (IUJK-N) as
a Company Branch Office that is approved by the Regent of
Majalengka Regency Number: Kep 018 / 2014-1-083032-
3201-0004. January 16, 2014. Registered Tax Company
NPWP Company Head Office Number: 31,445,531.2-
044,000, while Branch NPWP Number: 31,445,531.2-
438,001. and Disturbance Permit / HO by BPPTPM
Majalengka Regency Number: 536 / 1160.SK-IG / XI-
BPPTPM / 2012. November 14, 2012. Registered Majalengka
Regency Chamber of Commerce and Industry (KADIN)
Number: 20120-14000119 National Register Number: 140227
-005634. February 26, 2014. And KADIN as the Company's
Head Office Number: 20205-12094585 / 8-8-2012 National
Register Number: 150622-018290. July 31, 2015. The basics
of the permit are a sign of the official legality of a limited
liability company PT. Binhara Inti Nusa located in Palasah
Village, Palasah District, Majalengka Regency, West Java
Province, as a Branch Office of PT. Binhara Inti Nusa located
in the Unitary State of the Republic of Indonesia. Indonesia
needs many entrepreneurs to build economic strength and
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improve people's welfare. To deal with the free market in
2010, entrepreneurs are expected to be able to strengthen the
national economic pillars (Media Indonesia, 2007). Seeing the
journey of small businesses as one of the parts of the lower
classes of society, has a role in national development, which
has prospects to be developed, it is necessary to get a better
touch of development so that they have more power to realize
their goals, because in reality the sector who is very close to
this little person is still far from "professionalism" and the
continuity of his business is still stagnant.
I.2. Identification of problems. Based on the background of
the problem, some problems can be identified, including: 1.
Changing the dynamic global business environment and the
knowledge capital of the business it runs, entrepreneurs have
not been able to innovate and be creative in order to maintain
their business well. 2. The tendency of productive age in
developing countries to become an employee is still high in
order to fulfill their needs, so that the entrepreneurial spirit is
still low. 3. Government policies that tend to be less
constructive in the regulation of developing business permits
for their citizens. 4. A business environment that is not
conducive, causing entrepreneurs to feel unenthusiastic and
less innovative in developing their business, so that the
production of entrepreneurial activities cannot be distributed
to the community of service users / goods, this has an impact
on business continuity. 5. The weak implementation of related
institutions to trigger the ability to find the best solutions is
influenced by the ability to think creatively (creative thinking)
for the executing companion of the success of small and
medium enterprises. 6. Entrepreneurs have not been able to
develop operational dimensions of business capital to achieve
business performance. 7. Entrepreneurs have not been able to
anticipate the operational dimensions of the business
environment to achieve business performance. 8.
Entrepreneurs have not been able to optimize their
entrepreneurial characteristics. 9. Not yet realized the
implementation of government policies in responding to the
challenges of small business competition in order to reduce
dependency on employment opportunities to the government.
10. Business owners have not been able to optimize business
capital, business environment, entrepreneurial character to
improve the company's performance in its business continuity
efforts.
I.3. Scope of problem. The limitation of the problem in this
study is how the study of the effect of business capital,
changes in the business environment, entrepreneurial character
and the performance of the company towards limited liability
small and medium enterprises in Palasah Village, Palasah
District, Majalengka Regency, West Java Province.
I.4. Formulation of the problem. Based on the limitation of the
problem, the problems in this study are formulated as follows:
1. What is the business capital of a small and medium-sized
business limited liability company in Palasah Village, Palasah
District, Majalengka Regency, West Java Province. 2. What is
the change in the business environment of small and medium-
sized business limited liability companies in Palasah Village,
Palasah District, Majalengka District, West Java Province. 3.
What is the entrepreneurial character of a small and medium-
sized limited liability company in Palasah Village, Palasah
District, Majalengka District, West Java Province. 4. How is
the company's performance in small and medium-sized limited
liability companies in Palasah Village, Palasah District,
Majalengka District, West Java Province. 5. How is the
continuity of a small-scale limited liability business in Palasah
Village, Palasah District, Majalengka District, West Java
Province. 6. How big is the influence of business capital,
changes in the business environment, entrepreneurial character
and performance of the company towards limited liability
companies in Palasah Village, Palasah District, Majalengka
Regency, West Java Province, both partially and
simultaneously. 7. How big is the impact of the company's
performance on the sustainability of a small-scale limited
liability business in Palasah Village, Palasah District,
Majalengka Regency, West Java Province.
I.5. Research purposes. The research aims to gain an
understanding based on empirical data regarding the model of
causality relationships between variables: 1. To find out and
examine how the influence of business capital on small and
medium enterprises limited liability companies in Palasah
Village, Palasah District, Majalengka Regency, West Java
Province. 2. To find out and examine how the changes in the
business environment of small and medium-sized business
limited liability companies in Palasah Village, Palasah
District, Majalengka Regency, West Java Province. 3. To find
out and examine how the character of entrepreneurship in a
small and medium business limited liability company in
Palasah Village, Palasah District, Majalengka Regency, West
Java Province. 4. To find out and examine how the company's
performance in a small and medium-sized limited liability
company in Palasah Village, Palasah District, Majalengka
Regency, West Java Province. 5. To find out and examine how
the continuity of a small-scale limited liability business in
Palasah Village, Palasah District, Majalengka Regency, West
Java Province. 6. To find out and assess how much the
influence of business capital, changes in the business
environment, entrepreneurial character and the performance of
the company towards limited liability small and medium
enterprises in Palasah Village, Palasah District, Majalengka
Regency, West Java Province. partially or simultaneously. 7.
To find out and assess how much the impact of the company's
performance on the continuity of small-scale business limited
liability companies in Palasah Village, Palasah District,
Majalengka Regency, West Java Province.
I.6. Benefits of research
I.6.1. Theoretical benefits
The results of this study are useful for developing a study of
entrepreneurial economic theory that the continuity of small-
scale business limited liability companies in Palasah Village,
Palasah District, Majalengka Regency, West Java Province.
Influenced by the performance of the company and also
influenced by factors influencing business capital, changes in
the business environment, and entrepreneurial character.
I.6.2. Practical benefits. The results of this study are useful to
be developed into entrepreneurship development training
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programs for prospective young entrepreneurs. They get the
provision of intensive training on the factors that support
entrepreneurial success. The results of this study will help the
government to provide guidance for entrepreneurs in order to
increase entrepreneurial achievement. The government can
utilize the results of this research by designing entrepreneurial
training and education for potential entrepreneurs in the
Palasah Village, Palasah District, Majalengka District, West
Java Province.
CHAPTER II
LITERATURE REVIEW, THINKING AND HYPOTHESIS
FRAMEWORK
2.1. Literature review
2.1.1. Understanding of Economics. In the category of the
nature of the economy at the level of people's welfare, the
most important review is its understanding, that the meaning
intended in it contains elaboration in the broad and narrow
sense, when the meaning contained in the form itself. This
aspect of meaning has the word "Nature" which is usually
intact in an abstract form which includes the meaning it
contains, for example the meaning is related to the theoretical
relation of the cycle of the economy possessed by the region,
its character, and the potential that exists. Whereas science in
philosophy is a knowledge that is dinalar by human reason, so
that humans can think good and bad with logic, and empirical
evidence in the attitude of its phenomenology. After yesterday
we learned about actions, motives, and economic principles,
we conclude that it is necessary to describe the economics and
its distribution, before we must understand what economics
really is. So, economics is a study of all human behavior that
aims to obtain and manage limited resources. Economics can
also be understood as an attempt to make an alternative goods
or services to satisfy the needs of unlimited human life, the
basic concept of economics is the role of intervention by
various parties including the government and the economic
level of the region itself, to develop a civilization through a
program based on a strategic plan, for example the application
of a network of Transaction and Electronic Information (ITE)
empowerment and so on in regions or regions that have
deceived their technology, technology areas are regions which
subsequently carry out development from a period of
companies in this area, then need to be based on ITE
technology (Information on Electronic Transactions) for the
sake of its smooth operation. 2.1.2. Understanding
Entrepreneurship. Etymologically entrepreneurship is the
equivalent of entrepreneurship, namely things related to
entrepreneurship or entrepreneurship. In Indonesian
Entrepreneurship is a combination of the terms Entrepreneurs
who come from Sanskrit and the word entrepreneurship means
the main, brave, brave, carrying out productive activities, to
produce goods and services for others and gain profits.
The term entrepreneur comes from entrepreneurial French,
which means pursuing opportunities, filling needs through
innovation and running a business. The term entrepreneur was
first introduced by Cantillon around 1755 an Irishman living
in France, in his work "Essai sur la nature du Commerce en
General". Furthermore, in modern terms the term entrepreneur
was reiterated by French economist Say. In Germany, people
translate the term entrepreneur as an unternehmer, who has
both run and run their own business. In English terms it is
called "owner-manager", where the word is generally used to
distinguish the word "Boss" which also has a company with
the word "Professional manager" or with a paid employee
(hired hand). The term entrepreneurship also cannot be
equated with the term capitalism. Smith as the founding figure
of economic theory places capitalism in its function as a
provider of capital. So even if Stuart Mill continues to
understand classical economics firmly separates the function
of entrepreneurship from capitalist functions, the function of
entrepreneurs refers to the description of Contillon is the risk
bearer, or in Schumpeter's opinion those who introduce
innovation.
2.2. Influence of Business Capital. The initial problem faced
by entrepreneurs (entrepreneurs) who are starting a business is
business capital. Business capital is the main source that can
drive business activities to run smoothly. Entrepreneurship
capital has 2 types, namely intangible capital (Suryana, 2006:
5). The limitations of business capital (tangible) will
significantly affect the business space, so that entrepreneurs
cannot yet increase production volume and it is difficult to
expand the market (Alma, 2007: 116). Entrepreneurship
requires adequate business capital, business capital is the
initial capital that supports a person to open an independent
business, such as intellectual, social, moral, mental and
material capital (Suryana, 2006: 5-7). Intellectual capital is
enhanced through education and training that enables actors to
engage in quality in entrepreneurial activities. Appeals about
efforts to improve entrepreneurial capacity driven by
entrepreneurship are indeed interesting to study carefully in
the development of Indonesia in the future. Intellectual capital
in the form of adequate intelligence capacity (smart) will
influence the mindset in the process of problem solving and
decision making. Those who are smart and creative will look
for business opportunities that can bring profit. Social capital
is a capital in the form of the ability to establish relationships
with other people. An entrepreneur seeks to develop
interpersonal competencies, communication skills, skills to
lead and manage his business. They involve relationships with
others who are led and coordinated to realize their business
goals well (Dewanti, 2008: 13). Suryana (2006: 6-7) says
moral capital in the form of competency to develop
personality integrity that can lead to trust in others. Therefore,
an entrepreneur always pays attention to entrepreneurial ethics
such as honesty, integrity, keeping promises, loyalty, fairness,
likes to help others, respecting others, being a good citizen and
law-abiding, pursuing excellence and responsibility. Every
speech, action, behavior and deed in making a business
decision will be based on moral values. According to Hendro
and Chandra (2004: 56) as entrepreneurs who think forward in
the long run, each business decision can be accounted for on
the basis of moral values and does not violate religious
teachings (social norms of society).
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2.3. Changes in the Business Environment. Business
environment is dynamic. One factor influences the dynamics
of the business environment, namely the development of
information technology. Progress in information technology
contributes greatly to business people to obtain fast and
accurate information. Various information obtained through
information technology will be an important basis for
consideration in business decision making (Widoatmodjo,
2007: 34). According to Kinichi Ohmae in Widoatmodjo,
(2007: 35-36) changes in the business environment at the local
level are closely related to global business conditions. There
are 4 (four) dimensions globally that also influence the
dynamics of changes in the business environment, namely the
visible dimension, the borderless dimension, the cyber
dimension and the dimension of high multiplus. The visible
dimension is a business dimension that is characterized by the
stability of business people to maintain business space in the
business that has been controlled by the market and the
expertise in producing goods or services. If businesses already
feel well-established in obtaining a market that benefits their
business, then they will keep the business stable. For example,
those who have mastered the marketing of transportation, they
are trying to survive for the transportation sector and have not
considered other businesses. The borderless dimension is a
business dimension that knows no national borders due to the
formation of the WTO (World Trade Organization), a world
trade organization. The WTO influences State policies to
openly accept global markets (Widoatmodjo, 2007: 35).
Various countries can expand their business without
recognizing the boundaries of trade and government. Each
country realizes that trade between countries has entered the
era of globalization which has caused the marketing of a
product or service to have crossed the borders of the state.
Often a country is no longer able to protect domestic business
activities, because foreign businesses can freely compete by
entering domestic marketing (Supomo, 2007: 199-200). For
example Nokia handphone companies from Finland, Europe
dominates hendphone marketing in Indonesia (Robbins &
Couter, 2004, p. 90). The cyber dimension is a dimension of
advancement in communication technology and information
influencing changes in relations between producers and
consumers. Manufacturers can market their products to
consumers through internet media (Widoatmodjo, 2007: 35).
Consumers can also order goods or services through
information technology quickly without any obstacles. When
an agreement has been reached between consumers, the goods
or services are immediately sent to consumers and consumers
can make payments via credit cards (Ladish, Morgan &
Kalliapur, 2001: 83). 2.3.1. Environmental Assessment. The
ability of an entrepreneur to understand and recognize
business opportunities is proportional to the level of his
knowledge of political development, socio-cultural economy
and technology in his environment. Environmental
assessments that provide opportunities and risks are the basis
of opportunity recognition. Environmental research is a mental
exercise because an entrepreneur must do business equipped
with some physical effort. 2.3.2. Political Environment. A
political situation is a measure of the overall investment
situation that applies in a country or state. Prospective
investors must consider positive government actions that have
encouraged private investment. These actions include the
dissemination of free investment policies or unlimited
investment, the existence of investment development centers,
industrial land creation, free trade areas, and the availability of
low-cost loan capital for private investors. An example of a
positive government action taken by the Bangladesh
government is the issuance of an Industrial Investment
Schedule that shows the separation of allocations from small-
scale industrial and small-scale industries and investment
guidelines in Bangladesh to develop and attract industrial
activities. To achieve a balanced development of a country,
the government permits special privileges and tariff
concessions to industries that are located in Bangladesh's
Small and Cottage Industries Corporation (BSCIC), industrial
land, and developing industrial areas selected. Likewise
certain additional facilities, such as the provision of lower
interest rates for export-oriented industries. The government
maintains that facilities and concessions are given to
developed regions and relatively undeveloped areas or poor
areas in the country. 2.3.3. Economic Environment. Critical
assessment of the general state of the economy and its
prospects and providing meaningful information to potential
investors. This information is per capita income, current
national income, availability of credit savings, and income
distribution. The expanding economy means increasing
suitability in the number and extent of industrial, commercial,
agricultural, and service facilities. An analysis of the
economic environment will specifically help investment
decisions, market measurement, and estimate the ability to
recognize the types of patterns of economic growth. Soriano
and Neart in Wirasasmita (1994; 80) emphasize this problem
and argue: "The special interest outside the growth of GNP is
population growth. Usually, this is not considered so that there
is more consumption, less investment, slower growth, low per
capita income, and the income distribution pyramid is more
acute on a broader basis. All of this is critical to the demand
for different types of products and services and several other
environmental aspects. 2.3.4. Technology Environment. New
developments in the field of science and technology continue
to create new industry opportunities. As Kotler said, "Every
new technology is likely to develop a large industry."
Therefore, an entrepreneur must continually examine local
raw materials and existing products for possible utilization and
repairs. For example, Osborn submits a list of questions to
stimulate ideas about changing certain types of products.
2.3.5. Entrepreneurial Characteristics. Sukardi (Lupiyoadi,
2007: 7-9) mentions that there are 9 characteristics of
entrepreneurial behavior in the world, namely; instrumental,
prestative, flexibility, social work, hard work, self-confidence,
risk taking, self-control, innovation, and independence. The
instrumental nature is a trait characterized by the ability to be
observant in utilizing an opportunity in the living environment
to achieve business goals. Interpersonal relations, the presence
of community leaders, and experts in certain fields are always
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used to help achieve goals in business. In other words,
everything in its environment is seen as an instrument of
personal purpose. 2.3.6. Characteristics of Entrepreneurship
Indicators. The theory of Zach's Star of Succes is used as a
variable to find out entrepreneurial characteristics, namely
Knowledge dimension, according to Jeff Olson (2004; 52)
found sources of knowledge are three things: Studied
Knowledge, read the development material that has been
written by experts according to your needs. Reading is an
escalator that allows to accelerate your understanding of
humans and the world. Once you have gained understanding
before other people, then that understanding can be a
competitive advantage for you. Activity Knowledge, it is clear
that life is a process, therefore the road to success is always in
a position of being improved. 2.3.7. Business performance.
Performance stands for work energy kinetics, where followers
as human resources have energy, mind, knowledge and skills
that if driven (kinetic) will produce work output. Performance
is a managerial process, the leader carries out functions, tasks,
and all of his potential abilities to create performance in
achieving organizational goals. Wirawan, (2003).
Furthermore, Bernadin & Russell (2002) defines performance
(performance) as a record of the outputs of the functions of a
particular job or activity over a certain period of time or in
other words performance is the level of success in carrying out
tasks as well as the ability to achieve set goals. Hawkins
(1979) performance is the ability of work to express the notion
of performance as follows: "Performance is: (1) the process of
performing, (2) a notable action or achievement, (3) the
performing of a play or other entertainment". In its
implementation, each generic size can be described with
certain guidelines so that it can show the value of each aspect.
In general, the relationship of the four perspectives can be
seen in the figure below.
Image: Relationship of the Four Perspectives
Source: Adi Suminto : 2017 Management Strategic of Admintrations Organization
From the chart, it can be seen that the manager's ability will
influence the production process more efficiently and
qualitatively so that it can satisfy consumers through
appropriate delivery on time delivery times and create
customer loyalty which in turn increases sales growth sales
growth and results in financial aspects of increasing earnings
opinion growth. 2.3.8. Performance Measurement Steps.
Today many companies or organizations examine the size of
their performance because existing performance measures are
considered ineffective. Some company leaders have made
improvements to their efficiency structures with little added
and shifting focus of attention, while other organizations are
refining some of the old performance measurement indicators
by building a series of new size performance indicators. Why
does management need attention focused on performance?
The leaders of the company and their staff have hopes to: 1.
Increase the performance target of the overall organizational
process. 2. More emphasis on employee empowerment and
management systems in accordance with company goals. 3.
Identify and improve performance that is not optimal. 4.
Motivating workers effectively, by providing rewards for the
success of achieving company goals. 2.3.9. Difficulties in
evaluating performance. Many companies do not have a
comprehensive and integrated performance measurement
matrix, while everyone knows how important effective
performance measurement indicators and large resources are
allocated to renew management information systems to
support the effectiveness of work monitoring systems. 2.3.10.
Planning
Consumen
ROCE
Return on Capital
Customer Loyalty
On-Time Delivery
Customer Loyalty Customer Loyalty
Customer Loyalty
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Implementation of Performance Evaluation in Small
Industries. Looking at the elements assessed in the balanced
scorecard, then of course the items require accurate data and
documents that can be used as evidence of activities that take
place in a business organization. Thus, it must be admitted that
the concept of balanced scorecard performance measurement
is implemented initially in business organizations that have
applied the standard principles of modern business where in
their operations well-standardized, complete and scheduled
management functions are carried out. The problem is whether
small businesses in Indonesia have met the norms which can
be measured through balance scorecard.
2.4. Framework. The life cycle of an organization is one of
several theories that try to explain why businesses develop and
change over time. The life cycle model is based on the
recommendation that managers can change organizations to
adapt better to their environment in order to have the power to
survive.
Population ecology, The term ecology refers to the
relationship between humans and other living things with air,
soil, and water that support their lives. Wheelen, (2003: 8) is
based on the concept of natural selection in biology. The main
principle is that being an organism is the best choice to survive
in an ever-changing environment, while others die.
Organizational experts make two main assumptions, namely:
1. Organizations have a limited ability to adapt in a changing
environment. 2. The process of change is controlled by nature.
The basic argument is, in an industry, organizational
variations tend to develop because different strategies will
lead to differences in structure and process. Organizations that
are able to adjust well to environmental constraints will
develop well, while others will fail if they cannot. For
organizations that can survive, they tend to grow and become
a dominant part of the industry. Adherents to the theory of
resource dependence focus on the ability of organizations to
obtain important resources in the environment as a
determinant in the survival of their business. Growing up is
easy when the environment is rich in resources (all the
resources needed by the company are fully available) so the
company must appoint people who are responsible for
ensuring important resources that must always interact with
the group of providers through collaboration. Thus only
companies that can maintain continuity of access to resources
that are able to sustain their lives.
2.5. Research Hypothesis
The following are some of the research results that are
relevant to the study's research. Researcher Year Title of
relevant research results : 1 Mochamad Chabachib 2001 Effect
of quality management of member participation and business
environment on the implementation of management and
financial performance of KUD in Central Java The business
environment has a significant effect on company performance,
especially financial performance. 2 Dalimunthe 2003 Effect of
Individual Characteristics, Entrepreneurship, Leadership Style
on Business Capability and Success of Small Weaving and
Embroidery Industry Business in North Sumatra, West
Sumatra and Riau components of internal analysis which is a
series of competencies which then form core competency.
This competency enables small industries to increase business
capacity in an effort to create competitive advantage to
achieve business success. In addition, the Indonesian people
are a nation that has a diversity of cultures that gives birth to a
variety of different patterns of behavior between individuals. 3
Sumarsono 2003 Several factors that influence company
performance and satisfaction of internal stakeholders The most
dominant factors affecting business performance are
intellectual capital and entrepreneurial characteristics. 4
Yurniwati 2003 Effect of business environment and strategic
planning on the performance of manufacturing companies The
business environment influences company performance more
than strategic planning. 5 Anik Tri Sumarni 2004 Effect of
internal environment and macro external environment on
strategic relations and business performance of dairy cattle in
West Java The internal environment and external environment
have a significant effect on business performance belonging to
small and medium enterprises. 6 I Wayan Bagia 2005 The
influence of intellectual capital and job satisfaction on the
performance of district government officials in Bali human
capital has a significant relationship with economic capital.
This means that in the management, development and
supervision of human capital it is necessary to support the
strength of economic capital, so that human potential can be
optimized. 7 Sugito Effendi 2005 Effect of the Human
Resource Management strategy on training and intellectual
capital and its impact on company performance 1. The skills
and expertise of small entrepreneurs through training are not
only based on the experience of entrepreneurs,
2. increasing the entrepreneurial spirit through increasing
knowledge, abilities, and understanding of company vision,
planning, creativity, risk taking, and adaptation. 8 Setyobudi
2005 Analysis of the Effect of Human Capital, Economic
Capital, and Entrepreneurship Spirit on Member Participation,
Business Improvement and Remaining Business Results and
Its Impact on Member Welfare in Jakarta Family Teacher
Cooperatives 1. Business capacity through a strategy of good
linkage competency with suppliers (backward linkages) and
customers (foreward linkages) that can result in improvements
in the operational field; improvement of capital structure by
fostering relationships with capital owners. 2. The government
plays an important role in developing small competency-based
industries through mentoring activities. 9. Adi Suminto 2017.
Strategic Management in the Administration of Organizations
: 1. Management is a category in administrative attitudes to
produce innovative goals in learning performance.
2.6. For Small and Medium Enterprises Limited Liability
Company in Palasah Village, Palasah District, Majalengka
Regency, West Java Province. Entrepreneurship requires
adequate business capital, the influence of business capital is
the initial capital that supports a person to open an
independent business, such as intellectual, social, moral,
mental and material capital. Intellectual capital is enhanced
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through education and training that enables actors to engage in
quality in entrepreneurial activities. Intellectual capital in the
form of adequate intelligence capacity (smart) will influence
the mindset in the process of problem solving and decision
making. Social capital is a capital in the form of the ability to
establish relationships with other people. An entrepreneur
seeks to develop interpersonal competencies, communication
skills, skills to lead and manage his business. Moral capital in
the form of competence to develop personality integrity that
can lead to trust in others. Therefore, an entrepreneur always
pays attention to entrepreneurial ethics such as honesty,
integrity, keeping promises, loyalty, fairness, likes to help
others, respecting others, being a good citizen and law-
abiding, pursuing excellence and responsibility. 2.6.1.
Research Descriptions. Based on the literature review, the
framework of thinking, the hypothesis in this study are as
follows: 1). There are mutual influences between business
capital, business environment and entrepreneurial
characteristics. 2). There is the influence of business capital on
business performance. 3). There is the influence of the
business environment on business performance. 4). There is an
influence of entrepreneurial characteristics on business
performance. 5). There is influence of business capital,
business environment, and entrepreneurial characteristics both
partially and simultaneously on business performance. 6).
There is an influence of business performance on business
continuity.
CHAPTER III
RESEARCH METHODOLOGY
3.1. Research design. The intended design is the method. This
method used in the research is the survey method. The survey
method is a research method used to obtain facts from existing
symptoms and to find facts in fact (Nazir, 1998). With survey
methods can dissect, discuss, and recognize problems, and get
justification for the circumstances and practices that are
ongoing. In addition, the survey method can also be evaluated
and comparisons of things people do in handling similar
situations or problems and the results can be used in making
plans and decision making in the future. In the survey research
method, data is collected from samples of the population and
uses questionnaires as a basic data collection tool
(Singarimbun & Effendi, 1995). In accordance with its
purpose, this research is to explain the causal relationship
between research concepts and hypothesis testing in order to
make decisions inductively or generalize, then this research is
explanatory or confirmatory research.
3.2. Research model
3.2.1. Research variable. In this study there were 5 (five)
latent variables that were used as research objects, namely the
Influence of Business Capital (PMU), Changes in Business
Environment (PLU), Entrepreneurship Character (KK),
Corporate Performance (KP) and Small and Medium
Enterprises Limited Liability Companies (UKMPT) . Each
latent variable cannot be measured directly but can be
measured through a manifest variable, that is an indicator of
each of these variables. The latent variable is symbolized by
the ellipse environment, while the manifest variable is a
square or rectangular symbol. In SEM analysis techniques
know the terms exogenous and endogenous variables. The
exogenous variables in this study were the Influence of
Business Capital (PMU), Business Environment Change
(PLU), and Entrepreneurship Character (KK). While
endogenous variables are Company Performance (KP) and for
Small and Medium Enterprises Limited Liability Company
(UKMPT). 3.2.2. Operational Definition of Variables.
Operational definitions for each research variable are as
follows: 3.2.2.1. The Influence of Business Capital is capital
that is used to build entrepreneurial businesses measured by
indicators: intellectual capital (X1), social capital (X2) moral
capital X3), mental capital (X4), and material capital (X5).
3.2.2.2. Changes in the Business Environment is the state of
the environment where business activities are carried out
measured by indicators: the visible dimension (X6), the
borderless dimension (X7), the cyber dimension (X8), and the
dimension of high multiplus (X9). 3.2.2.3. Entrepreneurship
character is the ability to create or provide acceptable new
ideas in solving entrepreneurial problems as measured by
indicators: knowledge (X10), network (X11), energy (X12),
commitment (X13), passion (X14). 3.2.2.4. The Company's
performance is measured by indicators: written commitments
and plans (Y15), product development (Y16), and strong
marketing teams (Y17). 3.2.2.5. Limited Liability Small and
Medium Enterprises are measured by indicators: low cost
(Y18), differentiation (Y19), and focus (Y20).
3.3. Sources and Methods for Determining Data. Sources of
data needed in the study consist of primary data and secondary
data. Primary data is obtained by conducting field research
through distributing questionnaires to leaders who are also
company owners in limited liability companies PT. Inti Nusa
Binhara, while the secondary data source is obtained by
conducting a literature review, namely studying literature
books, scientific journals, newspapers, scientific magazines,
seminar papers, information through the internet that are
relevant to the variables studied. In addition, data sources were
obtained from the relevant agencies and other papers which
had to do with the variables used in this study. Whereas the
target population is all small and medium-sized limited
liability companies in West Java that have received healthy
and halal certificates from the Food and Drug Monitoring
Agency (LPP POM). The technique of determining sample
locations using Cluster Random Sampling (CRS). With the
following steps: 1) Creating a sampling frame that is in the
form of a list of districts and cities in the West Java Province,
the results of which are as many as 16 districts and 9 cities. 2)
Selecting districts and cities that will be used as locations
(regions) of samples
3) For the distribution of sample units and the interest of each
city and district, then from 25 regencies / cities in West Java,
divided into 5 geographical regions with division of regions. Primary data is obtained by conducting field research through
distributing questionnaires to leaders who are also company
owners in limited liability companies PT. Binhara Inti Nusa,
while the secondary data source is obtained by conducting a
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literature review, namely studying literature books, scientific
journals, newspapers, scientific magazines, seminar papers,
information through the internet that are relevant to the
variables studied. In addition, data sources were obtained from
the relevant agencies and other papers which had to do with
the variables used in this study.
Whereas the target population is all small and medium-sized
limited liability companies in West Java that have received
healthy and halal certificates from the Food and Drug
Monitoring Agency (LPP POM). The technique of
determining sample locations using Cluster Random Sampling
(CRS). With the following steps: 1) Creating a sampling frame
that is in the form of a list of districts and cities in the West
Java Province, the results of which are as many as 16 districts
and 9 cities. 2) Selecting districts and cities that will be used
as locations (regions) of samples. 3) For the distribution of
sample units and the interest of each city and district, then
from 25 regencies / cities in West Java, they are divided into 5
geographical regions with the following regions: a. Region I
(Western West Java), covering Bogor Regency, Sukabumi
Regency, Cianjur Regency, Sukabumi City, Bogor City and
Depok City, which are used as sample units are Cianjur
Regency and Sukabumi City. b. Region II (Central West Java)
Covers Bandung Regency, Sumedang Regency, Bandung City
and Cimahi City, which are used as sample units in Bandung
City and Cimahi City, which are used as sample units in
Bandung City and Cimahi City. c. Region III (Southern West
Java) covers Garut Regency, Tasikmalaya Regency, Ciamis
Regency, Tasikmalaya City, and Banjar City, which are used
as sample units in Ciamis Regency and Tasikmalaya City. d.
Region IV (Eastern West Java), including Kuningan Regency,
Majalengka Regency, Cirebon Regency, Indramayu Regency
and Cirebon City, which are the sample units of Cirebon City
and Indramayu Regency. e. Region V (North West Java),
covering Subang Regency, Purwakarta Regency, Karawang
Regency, Bekasi Regency, and Bekasi City which are used as
sample units are Subang Regency and Bekasi City. The
selection of sample regions in each region was considered by
the availability of sample units and those that had the largest
number of small industries and the second in the region. The
technique of determining sample units is done by using
random sampling techniques (sample random sampling). The
sample size determination for each sample region and regency
/ city is carried out proportionally. The sample size taken
according to Schumacker and Lomax (1996: 20) is about 100-
150 subjects for sample size. According to Kelloway (1998:
20) that in general the sample size is 100-200 observations
which are adequate minimum limits (Hair et.al, 1998).
According to Joreskog & Sorbom in Bachrudin & Tobing,
(2003; 12) the sample size of at least 100 samples is sufficient.
Based on this opinion, it is a reference for the minimum
sample requirements of the total 488 population, the selected
sample size of 133.05 is rounded up to 135. Determination of
the sample size is supported by calculations made by
Surakhmad (1994: 100), "Sampling is 15 % is used if the
population is more than 100 and sampling as much as 50% is
used if the population is less than 100. The following is a
small and medium business limited liability company which is
registered at the KUKM Office that has a healthy and halal
certificate in West Java In summary, the division of regions,
sample units and sample sizes can be combined with the area
of West Java Province, both City and Regency with a total of
488 samples and the population taken is 100 so that the
content can be seen.
3.4. Data collection technique. Data collection techniques for
the purposes of research analysis used data collection
techniques through questionnaire observation and interviews.
1. Observing, which is collecting data by observing the
activities of the company directly related to the problem that is
meticulous. 2. Disseminate Questionnaires, to respondents
using a list of questions submitted directly to respondents,
concerning the influence of business capital, changes in the
business environment, entrepreneurial character and to small
and medium enterprises limited liability companies and
company performance. 3. Conduct interviews with all parties
related to the problem under study, in order to be able to
reveal facts that occur in the field. Prime data obtained from
questionnaires are arranged in an ordinal scale based on the
Likert Summated Rating. Before the questionnaire was used to
collect primary data, a questionnaire trial was conducted to
test its validity and profitability.
Validity testing is testing the level of ability of a measuring
instrument to be able to measure what should be measured.
The purpose of testing the validity of the questionnaire is to
measure how carefully a test performs its size, two elements
about its target, and accuracy or the ability of a measuring
instrument to carefully measure the size of the symptoms or
parts of the symptoms being measured.
3.5. Research Instrument. In the field of research instrument as
a tool for collecting research data (Djamail & Mulijono, 2004,
7). The instruments in this study consisted of business capital
instruments, business environment, entrepreneurial
characteristics, business success and business continuity.
Instruments are very important in a study. This is because the
instrument as a data collection tool is used to answer the
research hypothesis. For this reason, an instrument must fulfill
certain conditions, namely valid and reliable. Anastasi and
Urbin (1998, 85) state that validity is concerned with what is
measured by the test and how well the test can measure. An
instrument is declared valid if it has a high validity coefficient.
Instead the instrument is not or less valid if it has a low
validity coefficient. In this research, testing validity includes
content validity and construct validity. In analyzing this
instrument, testing the validity and reliability using the
LISREL computer version 8.54. The technique used is
Confirmatory Factor Analysis (CFA). Confirmatory factor
analysis is a factor analysis whose latency variables (factors)
have been determined before the data are analyzed, the
purpose is to confirm the observed variables on the latent
variables (Sitinjak & Sugianto, 2006, 40). To determine
significantly by looking at the value of the results of the t test
and comparing it with the t table or 1.96. If the value of t
count is greater with t table or 1.96 then it is declared
significant. In addition to estimation and t-test calculations, it
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is also based on the Goodness of Fit (GOF) test, which is
testing whether empirical data with the model is fit. If the
criteria for stating that data and models are fit are explained in
the decomposition of data analysis techniques. Fornel and
Larker in Wijanto, (2008, 66) stated that to measure
instrument reliability in SEM used a composite reliability
measure (measure of composite reliability) and variance
extracted measure (size of extract variant). The composite
reliability of a construct is calculated by the formula:
(Σ Standard Loading) 2
CR = ------------------------------------
(Σ Standard Loading) 2 + Σ ej
Information : CR = Construct Reliability. ej = Meanxurement
Error. Variance extracted reflects the total number of variants
in the indicators (the most variable variables) explained by
latent variables. The size of extract variance can be calculated
by the formula:
(Σ Standard Loading) 2
VE = -------------------------------------
(Σ Standard Loading) 2 + Σ ej
Information : VE = Variance Extracted. ej = Meanxurement
Error. Hair, et. Al (1998) states that a contract has good
reliability if: 1) the value of Construcct Reliability is greater or
equal to 0.7.2) Variance Extracted is greater or equal to 0.5.
3.6. Data analysis technique. To test the research hypotheses,
the stages of data analysis are carried out first, namely as
follows. (1) describing research variable data, (2) conducting
analysis requirements test, and (3) testing the hypothesis.
Descriptions of each variable include; calculation of average,
adequate, mode, variance, standard deviation, range,
maximum and minimum score. After descriptive analysis
followed by inferential analysis used to test the research
hypothesis. In the research the contents of the hypothesis test
are carried out by SEM (Structural Equation Modeling). SEM
is a multivariate analysis technique that is used to test the
relationship between complex variables to obtain an overview
of the overall model. SEM can test together structural models
and measurer models. The structural model is the relationship
between constructs or latent variables (variables that cannot be
measured directly and require some indicators to measure
them) independent and dependent (exogenous and
endogenous). Measurement model is a relationship (loading
value) between indicators and latent variables or constructs
(Ghozali & Fuat, 2005: 3). Bollen and Long (Schumacker &
Lomax, 1996: 63) state that the steps in SEM analysis include:
model specifications, model identification, parameter
estimation, fit and respensification tests. If in the assessment
phase the fit model is found that empirical data with the model
is not fit, modification of the model is carried out. Based on
the study of the theory underlying this research, the research
hypothesis and operational definitions of variables, the path
diagram of this study is described as follows:
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1
3
2 1 2
X11
X12
X13
X14
X15
X21
X22
X23
X31
X32
X34
X33
X35
Y13 Y12 Y11
Y23
Y22
Y21
11
12
13
15
14
21
31
32
33
35
34
22
23
1
7
6
5
2
3
4
8
9
10
11
12
13
1
5
2
6
3
4 2 1
51
52
53
41 42 43
11
12
13
1
12 13
23
Figure : Structural Relationship Model for the influence of Business Capital, Changes in the Business Environment, Characteristics of Entrepreneurship in Small
and Medium Enterprises Limited Liability Companies and Their Impact on Company Performance in Palasah Village, Palasah District, Majalengka District, West
Java Province.
3.7. Model Specifications. Based on the path diagram, the
specification of the measurement model of the causal
relationship in this study is as follows, namely the
specification of the measurement model for each latent
variable or construct of the Exogenous Latent Variable. a)
Business Model Effect (ξ1). X1 = λx1ξ1 + δ1. X2 = λx2ξ1 +
δ2. X3 = λx3ξ1 + δ3. X4 = λx4ξ1 + δ4. X5 = λx5ξ1 + δ5. b)
Changes in the Business Environment (ξ2). X6 = λx6ξ1 + δ6.
X7 = λx7ξ1 + δ7. X8 = λx8ξ1 + δ8. c) Entrepreneurship
Character (ξ2). X9 = λx9ξ2 + δ9. X10 = λx10ξ2 + δ10. X11 =
λx11ξ2 + δ11. X12 = λx12ξ2 + δ12. X13 = λx13ξ2 + δ13.
Endogenous Latent Variable. a) Company Performance (η1).
Y11 = λy1η1 + ε1. Y12 = λy2η1 + ε2. Y13 = λy3η1 + ε3. b)
Small and Medium Enterprises Limited Liability Company
(η2). Y14 = λy4η1 + ε4. Y15 = λy5η1 + ε5. Y16 = λy6η1 +
ε6. Information : X1 = Variable (indicator) manifest of
exogenous latent variables. Y1 = Variable (indicator) manifest
of endogenous latent variables. Xxij = Factor of exogenous
loading latent variable towards manifest variable (indicator)
(Lamda). Xxij = factor loading endogenous latent variables on
the manifest variable (indicator) (Lamda). ξ1 = Exogenous
latent variables influence business model (Ksi 1). ξ2 =
Exogenous latent variables changes in business environment
(Ksi 2). ξ2 = Exogenous latent variables Creativity (Ksi 3). η1
= Endogenous latent variable achievement motivation (Eta1).
η2 = Entrepreneurial endogenous latent variable (Eta 2). δi =
Error measuring manifest (indicator) of exogenous variable
(Delta). εi = Error measuring the manife variable (indicator) of
endogenous variables. (epsilon). Conversion path diagram into
a series of structural equations and measurement model
specifications. a. Construct Measurement of the Influence of
Business Capital. The exogenous construct measurement
model The Influence of Business Capital is shown in Figure
3.2 below:
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Figure : Exogenous Construct Measurement Model Effect of Business Capital. Based on figure 3.2 structural equations can be
derived as follows:
X11 = λ11 ξ1 + 1 ...................................................................................... 3-3
X12 = λ12 ξ1 + 2 ...................................................................................... 3-4
X13 = λ13 ξ1 + 3 ...................................................................................... 3-5
X14 = λ14 ξ1 + 3 ...................................................................................... 3-6
X15 = λ15 ξ1 + 3 ...................................................................................... 3-7
b. Construct Measurement of Business Environment Changes.
The measurement model for exogenous constructs of the
Business Environment is shown. And furthermore in the
measurement and translation described in detail.
3.8. Model Identification. The identification of the model is
done to get a picture of whether the covariance variant
information from the manifest variables is sufficient to
produce a unique solution (uniq solution) to obtain the model
parameters. Model identification is done to maintain that the
specified model is an Unidentified or underidentified model.
There are three possibilities that can occur in identifying the
model, namely: a) under-identified, which is where the
number of parameter values is not sufficient to estimate the
problem. This is because the estimated number of parameters
is greater than the number of known data (variance and
covariance of the manifest variables). b) Just-identified, which
is where the estimated number of parameters is the same as the
known data. In this model, only one information is used to test
the model (degree of freedom = 0), so that a single unique
solution can be estimated to estimate parameters. c) Over
identified, where the estimated number of parameters is
smaller than the number of known data. In this model, there is
a positive degree of fredoom, so that there is a number of
information that can be used to test the model (Byrne, 1998:
28-29). To determine whether the model in this study contains
under identified or not, the following assumptions must be
fulfilled and as a measure of whether the estimated number of
parameters is smaller, equal to or greater than the known data:
t ≤ s / 2. Information : t = Number of parameters
estimated. s = Number of data known (Amount of variance
and covariance of manasfest variables); s = (p + q) (p + q + 1).
p = Number of manifest variables of endogenous variables
(Y). q = Number of manifest variables of exogenous variables
(X). In this study, the number of parameters estimated (t) is
69, and the total number of variances and covariance of the
manifest variable (s) is 650, so that they are obtained: Then it
is concluded that the model is in a condition over-identified
with df (degrre of freedom) = 325-69-256. t ≤ s / 2. 69 ≤ (12 +
13 (12 + 13 + 1) / 2. 69 ≤ 650/2. 69 325.
3.9. Parameter Estimation. At this stage, it aims to obtain an
estimate of each parameter specified in capital that forms a
matrix of population covariance estimates (Σ), as close as
possible to the value of ang in the sample covariance (S). The
sample covariance matrix (S) is used to represent the
population covariance matrix (Σ), because the population
covariance matrix is unknown (Long, 1990, 56). There are
several estimation methods that can be used in SEM analysis.
3.10. Match Test. The main objective of SEM analysis is to
analyze the compatibility between the data and the
hypothesized model. The following are some indicators to test
the suitability of the model with data (Goodness of Fit).
3.11. Specification. This stage is based on the results of a
match test. The specifications depend on the model strategy
used. Wijanto (2008, 67) states that there are 3 (three) capital
strategies that can be chosen by SEM, namely: a)
Confirmatory modeling strategy. In this strategy modeling is
specified in one single model, then empirical data collection is
performed and significance testing is carried out. This test will
produce whether the model is accepted or not. This strategy
does not require respecification. b) Model competition
strategies (computing models strategy). In this capitalization
strategy, several alternative specification models and based on
an analysis of a group of empirical data, one of the most
suitable models was chosen. In this strategy respecification is
only needed if alternative models are developed from several
existing models. c) Model development strategy (development
strategy model). In this strategy an initial model is specified
and empirical data is collected. If the proposed model is not fit
with empirical data, then the model is modified and retested
1
X11
X12
X13
X14
X15
11
12
13
15
14
1
5
2
3
4
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with the same data. In this study a model development strategy
was chosen, where if the tested model was not fit with the
data, modifications were made based on the underlying theory
until a model was found to be suitable with empirical data.
3.12. Location and Research Schedule
3.12.1. Research sites. This research was conducted at certain
points of the most influential in observations (observations) of
researchers in Palasah Village, Palasah District, Majalengka
District, West Java Province. The duration of this study runs,
requiring a time span of between 6 (six) months from
September 2018 to February 2019, from the beginning of the
activity including preparation time to the stipulation of
completion time in the form of research results and scheduled
times therein. In conducting this research the researcher made
observations, also the researchers came directly to the object
of this research both with community members and the local
government apparatus (APD) or local government work units
(SKPD), namely at the village level namely Palasah Village ,
Subdistrict namely Palasah Subdistrict, and Regency level
namely Majalengka Regency, West Java Province, to obtain
the available evidence and validity in the reality of
phenomenological field data. And the evidence is in the form
of data and documents in the form of official letters where the
documents of the data are original obtained by the researcher
directly from the object in this study, which is in the location
of the research which is used as one of the research objects for
researchers valid nature of its existence in a predetermined
location, namely in a limited liability company Inti Nusa
Binhara and community members in Palasah Village, Palasah
District, Majalengka District, West Java Province.
3.12.2. Research schedule. The research schedule is as follows
with the research time as shown in the table:
Research schedule Activities Sep
2018
Okt
2018
Nop
2018
Dec
2018
Jan
2019
Feb
2019
Mar
2019
Preparation V
Proposal V
Data collection V
Research proposal V V
Research result
Meeting :
1) Closed
2) Open
V
V
CHAPTER IV
RESULTS AND DISCUSSION
4.1 Analysis of Description. Observations or data to be
analyzed are collected primarily using a questionnaire. With
the number of respondents selected into the sample as many as
200 leaders (owners) of small and medium enterprises
throughout the districts / cities in West Java. The
questionnaire consisted of 70 questions regarding respondents'
assessment of the Influence of Business Capital, Changes in
the Business Environment, Characteristics of
Entrepreneurship, Company Performance on Small and
Medium Enterprises Limited Liability Companies in Palasah
Village, Palasah District, Majalengka District, West Java
Province. After the data was obtained then tabulated,
described and then analyzed to determine the effect of the
Influence of Business Capital, Entrepreneurship Character and
Changes in Business Environment and Company Performance
and its implications for Small and Medium Enterprises
Limited Liability Company in Palasah Village, Palasah
District, Majalengka District, West Java Province using
analysis of Structural Equations Modeling (SEM). The
following is a description of the description of the data
observed by respondents.
4.2. Questionnaire Testing
4.2.1 Test Validity. Validity test is used to measure whether
the measuring instrument used in this case is an item or the
questionnaire statement is the right measurement (valid) or not
at all. For a large enough sample size (n> 100) an item is said
to be valid if it has a positive correlation value and the
minimum is included in the category of weak correlation (r>
items have a value of t that is greater than the value of t-table
- 2. The
hypothesis of testi
measure the validity of the questionnaire items were Rank
Spearman correlation, which was formulated as: Where : r = j-
correlation coefficient in the variable concerned di = R (xij) -
R (tij). sample size used in the study. R (x.j) = ranking score
of item i-questionnaire in j-variable. R (tj) = ranking total
score of jth variable questionnaire items. Correlation values
obtained from calculations are compared with the critical
freedom dk = n - 2, or by using the following test statistics: ~
- 2). Criteria for testing the validity of
questionnaire items using provisions: a) Item question /
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b) Item questions / questionnaire statements declared invalid if
tcount <t table. The following is a summary of the Business
Capital variable validity test consisting of 10 items or
statements submitted to 200 respondents. Test the Validity of
the Questionnaire Variable in Changing the Business
Environment.
Item 1-
10 -
488
rhitung Thitung Ttabel rkritis Conclusion
11 0,771 17,036 1,972 0,300 Valid
12 0,756 16,252 1,972 0,300 Valid
13 0,725 14,812 1,972 0,300 Valid
14 0,774 17,201 1,972 0,300 Valid
15 0,797 18,568 1,972 0,300 Valid
16 0,714 14,350 1,972 0,300 Valid
17 0,749 15,907 1,972 0,300 Valid
18 0,656 12,230 1,972 0,300 Valid
19 0,635 11,566 1,972 0,300 Valid
20 0,680 13,050 1,972 0,300 Valid
21 0,741 15,527 1,972 0,300 Valid
22 0,811 19,506 1,972 0,300 Valid
23 0,685 13,230 1,972 0,300 Valid
24 0,769 16,927 1,972 0,300 Valid
25 0,768 16,874 1,972 0,300 Valid Source: Data on Questionnaire Analysis Results, 2018.
4.3. Successive Interval Method. Observation data collected in
the field using a Likert scale or level of measurement is
ordinal scale. Because in this study, the magnitude of the
influence of independent variables (exogenous) on the
Influence of Business Capital, Changes in Business
Environment and Entrepreneurship Character on non-free
(endogenous) Company Performance and its implications for
Small and Medium Enterprises Limited Liability Companies
using structured equation modeling (SEM) ) with a minimum
scale interval, then the Likert scale data is first converted into
an interval scale. Increase the ordinal scale to the interval
using the Method of Successive Interval (MSI from Hayes
(1963)) for each valid item.
4.4. Data analysis
4.4.1. Analysis of Confirmatory Factors. Before assessing the
structural model of Influence of Business Capital, Changes in
the Business Environment and Characteristics of
Entrepreneurship on Company Performance that have
implications for Limited Liability Small and Medium
Enterprises, confirmatory factor analysis (CFA) is needed to
determine whether the dimensions which is used to predict the
latent variable is correct or not. By using Lisrel software
version 8.70, the estimated confirmatory analysis model is
illustrated as shown in the figure below.
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Figure : CFA Model Effect of Business Capital, Changes in Business Environment, Characteristics of Entrepreneurship,
Performance of Companies and Small and Medium Enterprises Limited Liability Companies.
Because the CFA model all the latent variables are interconnected and the manifest variable is not allowed to predict more than
one latent variable, then the modification index of the addition of pathways does not need to be considered.
There are several error covariances that have a modification index value above 4, the largest between Y12 and Y21 of 32.5. This
means that by adding error covariance on the model it will reduce the Chi-Square value by 32.5 units. Modification of the CFA
model is done in stages by adding error covariance until the best model is obtained (fulfilling the goodness of fits criteria). The
modified results of the final CFA model as shown in the following figure.
The Modification Indices Suggest to Add an Error Covariance
Between and Decrease in Chi-Square New Estimate
X22 X21 8.1 0.07
X32 X31 17.1 0.05
X35 X31 15.8 -0.05
Y21 Y11 19.7 0.03
Y21 Y12 32.5 -0.05
Y23 Y11 17.2 -0.04
Y23 Y12 31.7 0.06
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Figure : Final Modification CFA Model
By adding 6 (six) gradual error covariance pieces, namely Y12
-square value of
172,8204 (P- value = 0.0000) to 83.2666 (P-value = 0.2158) is
much smaller than the initial CFA model and the RMSEA
value becomes equal to 0.02509 (Appendix 7). So that the
CFA model of this modification can be said to be fit. Testing
the significance of parameter estimates for each dimension in
predicting latent variables and covariance (correlation)
between latent variables and error covariance is presented.
4.4.2. Data Evaluation. Data evaluation is done to find out
whether the data to be analyzed using a structured model
meets the specified requirements or not. In a structured model,
the estimated parameters (loading factor and or regression
weight) produced through SEM analysis are expected to be the
best estimate, that is, having an unbiased nature and a
minimum variance. This data evaluation consisted of a
conformity test of confirmatory factor analysis model,
normality test, outlier examination (outliers), multicollinearity
test and singularity.
4.4.3. Establishment of Structural Equation Modeling (SEM).
In the SEM analysis the next stage after testing dimensionality
of factors, checking normality, outliers is forming a structural
model based on the final results of the CFA model which is to
find out the Influence of Business Capital, Entrepreneurial
Characteristics on Corporate Performance and its implications
for Small and Medium Enterprises Limited Liability
Companies in the Village Palasah Palasah District Majalengka
Regency, West Java Province.
Based on the model compatibility test in the table above,
conclusions can be described as follows: 1. Chi-Square value
of SEM model is 86.9575 (P-value = 0.2051). By taking the
95% confidence level, H0 is accepted and the model is
declared good because it has Chi-Square <abel2 table =
98.4844 or P-value value greater than the value of 0.05. 2. The
RMSEA value (Root Mean Square Error Approximation) is
less than 0.08. Standarized value of RMR (Standarized Root
Mean Residual) of 0.01610 is smaller than 0.05. By taking the
95% confidence level, H0 is accepted and the model is
declared good. 3. GFI value (Goodness of fit index) of 0.9449,
AGFI (Adjusted Goodness of fit index) of 0.9142, NFI
(Normed fit index) of 0.9925, NNFI (Non-Normed fit index)
of 0, 9986 and CFI (Comparative fit index) of 0.9990. All
match index values are greater than 0.90. Taking the 95%
confidence level, H0 is accepted and the model is declared
good. 4. The value of PNFI (Parsimony Normed fit index) of
0.7279 is greater than 0.60, so the model is declared good.
From all the fit test indices, it can be concluded that the SEM
model has fulfilled the minimum goodness of fits
requirements so that the model is declared good and can be
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used to answer the hypothesis in this study. The following figure is the result of SEM analysis for theoretical models.
Figure : Structural Model of the Influence of Business Capital, Changes in the Business Environment, Entrepreneurship Character on Corporate Performance and
Its Implications for Small and Medium Enterprises Limited Liability Companies.
The following table is a test of the structured model The Effect of Business Capital, Changes in the Business Environment,
Entrepreneurship Character on Company Performance and its implications for Small and Medium Enterprises Limited Liability
Companies. Table : SEM Model Regression Coefficient.
Variable
Laten
Endogen
Variable
Laten
Eksogen
Estimates
Parameter
Estimates
Parameter
standardized
Standard
node
thitung
Conclusion
Y1 X1 0,3164 0,3189 0,1021 3,0398 Significant
Y1 X2 0,2907 0,2879 0,06984 4,1628 Significant
Y1 X2 0,3356 0,3275 0,1104 3,0398 Significant
Y2 Y1 0,9398 0,9274 0,03643 25,8007 Significant Source: Data from Analysis Results, 2018 (Adi Suminto).
4.4.4. Measurement Model. Business Capital Measurement Model. Based on the SEM model in Figure 4.4 the measurement
model is for the latent variable Effect of Business Capital (X1) predicted by the dimensions of Tangible Capital (X11) and
Intangible Capital (X12).
4.4.5. Structural Model of Company Performance
Structured equation models from the Influence of Business Capital, Changes in Business Environment and Entrepreneurship
Character to Company Performance are stated.
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X1 = Influence of Business
Capital
X2 = Changes in Business
Environment
X3 = Entrepreneurship
Character Y1 =
Company Performance
are stated
Figure : The Model of Company Performance Influenced by the Influence of Business Capital. Changes in Business Environment and Entrepreneurship Character.
4.4.6 Structural Models of Small and Medium Enterprises Limited liability companies. Hypothesis 5: Company performance
simultaneously affects the Small and Medium Enterprises Limited Liability Company. Structured equation model from the
Influence of Business Capital and Changes in the Business Environment on Company Performance.
Y1 = Business Performance
Y2 = Business development
Figure : The Model of Small and Medium Enterprises Limited Liability Companies Affected by Company Performance.
4.5. Discussion. Influence of Business Capital. This research
succeeded in showing the purpose of knowing and examining
how the influence of business capital in small and medium
enterprises limited liability companies in West Java. Business
capital used as a variable in this study uses the theory from
Suryana (2008) which states that the influence of venture
capital in small and medium enterprises limited liability
companies has dimensions of tangible capital and intangible
capital, where tangible capital is capital in the form of material
capital, and capital in the form of money , while intangible
capital in the form of intellectual capital, social capital and
moral as well as mental capital. Changes in the Business
Environment. This research succeeded in showing the purpose
of knowing and examining how the business environment
changes in businesses in West Java. The business environment
is dynamic, one of the factors that influences the dynamics of
the business environment, namely the development of
information technology. The results of this study refer to the
theory of Kinichi Ohmae in Widoatmodjo, (2007) that changes
in the business environment at the local level are closely
related to global business conditions. Entrepreneurship
Character. This research has succeeded in showing the
purpose of knowing and examining how entrepreneurial
character in a limited liability company in West Java. The
Zach's Star of Success theory is used as a variable to
determine entrepreneurial character, with the dimension of
knowledge (knowledge), by always updating business
development material / business theory to make its business
competitive advantage, this is demonstrated by business
people by always following the slightest developments
regarding the process procurement of raw materials, process of
making products and product distribution processes. Company
performance. This research succeeded in showing the aim to
find out and examine how the performance of companies in
small and medium enterprises limited liability companies in
West Java. Business performance is something that is
produced by the company in a certain period with reference to
the standard set. Measuring company performance is not easy,
in essence business operators in West Java are required for
example at PT. Binhara Inti Nusa measures balanced
performance between financial aspects and non-financial
aspects. Opinion Sinaga (2004) which states that performance
measurement can produce useful information, there are several
things that must be considered, namely the measurement
system must be in accordance with organizational goals,
describe key activities of management, can be understood by
employees, easily measured and evaluated and can used by the
organization consistently and efforts need to translate into
goals. Small and Medium Enterprises Limited Liability
Company. This research succeeded in showing the aim to find
out and examine how the development of small and medium
enterprises limited liability companies in small and medium
enterprises in West Java. The life cycle of small businesses is
analyzed by several experts to find out why businesses
X1
X2 Y1
0,3189
0,2879
X3
0,2279
0,3275
0,7223
0,7183
0,8296
Y1 Y2 0.9274
0.1399
Y1 = 0,3189 X1 + 0,2879 X2 + 0,3275 X3 + 0,2279
Y2 = 0.9274 Y1 + 0.1399
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develop and change over time. This life cycle model is based
on the assumption that managers must be able to change their
business organizations to adapt better to internal aspects
(influence of business capital and entrepreneurial character)
and external aspects (changes in the business environment) in
order to have optimal performance and competitiveness to
sustain and develop his business. The effect of business
capital, changes in the business environment, and
entrepreneurial characteristics on the performance of the
company both partially and simultaneously in small-scale
limited liability companies in Palasah Village, Palasah
District, Majalengka Regency, West Java Province. This
research succeeded in showing the magnitude of the influence
of venture capital, changes in the business environment, and
entrepreneurial character towards company performance both
partially and simultaneously in small and medium-sized
limited liability companies in Palasah Village, Palasah
District, Majalengka Regency, West Java Province. Partially
this study shows that the influence of business capital has an
effect on company performance by 25.51%, while changes in
the business environment affect the company's performance by
21.74%, and entrepreneurial character influences the
company's performance by 26.16%. Simultaneously the
influence of venture capital, changes in the business
environment, and entrepreneurial character on company
performance have an effect of 73.41%. This study succeeded
in providing a theoretical description that the performance of
companies in small and medium enterprises limited liability
companies is influenced by optimizing and maximizing
utilization of business capital, both tangible capital and
intangible capital, as well as the readiness of business actors to
adapt to changes in a dynamic business environment to
maintain business and have strong business competitiveness. The impact of the company's performance on a small and
medium-sized business limited liability company in a small-
medium business limited liability company in Palasah Village,
Palasah District, Majalengka Regency, West Java Province.
This research succeeded in showing the magnitude of the
influence of the company's performance on small and medium
enterprises limited liability companies in Palasah Village,
Palasah District, Majalengka Regency, West Java Province, at
86.01%. The results of this study indicate that strong corporate
performance seen from the financial and non-financial aspects
will have a significant impact on business development. SWOT Analysis Development of a small and medium
business limited liability company in Palasah Village, Palasah
District, Majalengka Regency, West Java Province.
Strength – Strength 1. Having a legal entity (in this case the
chosen respondent is a businessman in West Java who already
has a permit for a company registration issued by the
Department of Industry and Trade of West Java Province). 2.
Small and medium enterprises are businesses that have a
simple organizational structure so that they do not require
managerial aspects that advance only require managerial
aspects in accordance with the existence of Small and Medium
Enterprises only. 3. Various limitations in accessing
productive resources make small businesses independent,
strong and flexible. The flexibility of small businesses from
one sector to another, actually becomes its strength in survival
and developing its business. 4. Small and medium enterprises
Limited liability companies are the most promising vehicles
and mainstays for the creation of new entrepreneurs. Small
businesses are the closest level that can be reached by people
who want to start entrepreneurship. 5. Small and medium
enterprises Limited liability companies have the
characteristics of a large capacity for the realization of the
economic aspirations of the wider community to earn a living.
6. Small and medium enterprises Limited liability companies
have high flexibility and resilience in anticipating and
adapting to the dynamics of market changes. This is due to the
dominance of the domestic market, as well as the strong roots
in the use of domestic resource inputs. 7. Limited liability
small and medium enterprises are not affected by foreign
currency fluctuations, because they still use domestic raw
materials.
Weaknesses – Weaknesses 1. Low quality of Human
Resources, reflected in the lack of development of
entrepreneurship, low productivity, and competitiveness. This
weakness is influential in creating and utilizing business
opportunities, aggressively accessing markets (especially
exports), and access to capital sources. 2. Limited facilities
and infrastructure, especially in the transportation,
telecommunications, water supply and electricity sectors. 3.
The limited access of small businesses to productive resources
is an obstacle to business development quickly and
sustainably. This is due to the structure of the national
economy which is full of imbalances in control and allocation
of productive resources. 4. Efforts to accelerate small business
development have various limitations, namely a fair market
mechanism that has not been effective in functioning, limited
state finances for fostering small businesses, not yet optimal
Bank intermediary function, and not yet optimal
implementation of regional autonomy to support small
business development. 5. Low commitment, capability, and
quality of coaches from the government and the lack of
consistency in policy, and the spirit of integration of various
parties (policy makers) in developing small businesses. 6.
Limited use of information technology (such as the internet),
so that market reach is limited and business efficiency is low.
Opportunities – Opportunities. 1. The recovery of the national
economy from the economic crisis. 2. The creation of food
security and economic defense in people's welfare. 3.
Increased awareness, commitment and partisanship of the
government, business world and society on the importance of
small businesses in the economy. 4. There is a strong political
will from the government, and the growing demands of the
community to create equitable and transparent development,
as well as a commitment to build a populist economic system
(although its implementation cannot be seen and cannot yet be
felt). 5. Support constitutional institutions (small business
laws) that give priority to economic development in small
businesses in realizing a democratic economic system. 6.
Implementation of better autonomy, along with better
financial balance so that policy support from the local
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government is expected to have an impact on the aspects of
equity prioritized by the government. 7. Changes in the
structure of the national economy from the agricultural sector
to the industrial sector and services. This creates opportunities
for small businesses to function as sub-contractors that are
strong and efficient for large businesses, with partnership
programs that are directly monitored by the government
through relevant agencies. 8. The increasingly rapid economic
cooperation between countries, especially in the context of
ASEAN and China, which provides greater opportunities for
marketing food and beverage products with borderless trade.
9. Availability of human resources in the workforce in large
numbers that are still not productively utilized. 10. The
potential of the domestic market continues to grow, along with
the development of the population and the level of consumer
purchasing power that is consumptive. 11. Development of
information and communication technology.
CHAPTER V
CONCLUSIONS AND RECOMMENDATIONS
5.1. Conclusion. Based on research carried out on small and
medium-sized entrepreneurs of limited liability companies in
Palasah Village, Palasah District, Majalengka District, West
Java Province, through observations, interviews and statistical
calculations, the results of the research can be concluded as
follows: 5.1.1. The Influence of Business Capital in this
research is in accordance with the formulation of the problem
and the objective can be concluded that the small-scale
business of limited liability companies in Palasah Village,
Palasah District, Majalengka Regency, West Java, assume that
tangible capital is a factor that determines business success,
business performance and business development , however, it
has begun to realize the importance of intangible capital as a
factor that determines the success of its business. The results
of the research and the findings of the above data can be
concluded that the small-scale business of limited liability
companies in Palasah Village, Palasah District, Majalengka
Regency, West Java Province have been able to optimize the
influence of business capital both tangible capital and
intangible capital with maximum effort to obtain and balance
business objectives inner satisfaction in managing and running
its business. 5.1.2. Changes in the business environment in this
research are in accordance with the formulation of the problem
and the goal can be concluded that the limited liability small-
scale business actors in Palasah Village, Palasah District,
Majalengka Regency, West Java, consider readiness from
various aspects to deal with dynamic environmental changes,
one of the factors the dominant one influences the dynamics of
the business environment, namely the development of
information technology. The small and medium-sized
businesses of limited liability companies in Palasah Village,
Palasah District, Majalengka Regency, West Java Province
have anticipated changes in the business environment by
preparing themselves by maintaining stability and maintaining
business space in the business they have mastered, both
markets and skills and expertise in producing goods or
services. The small and medium businesses of limited liability
companies in Palasah Village, Palasah Subdistrict, Majalengka
Regency, West Java Province in responding to changes in the
business environment have been characterized by not
recognizing the market trade limits of their products. These
provinces and countries are also supported by the entry of
Indonesia in the ACFTA members on January 1, 2010. Thus,
the free market has 2 (two) impacts for limited liability small
and medium businesses in Palasah Village, Palasah District,
Majalengka Regency, West Java Province, the first impact is
the positive impact of business actors can market a variety of
products without recognizing the boundaries of the region, it
can be known a variety of diversification of similar products
to improve the characteristics or specificity and uniqueness of
the products produced, but on the other hand the negative
impact of small and medium businesses s in Palasah Village,
Palasah Subdistrict, Majalengka District, West Java Province,
in terms of sales volume boosted by borderless trade, due to
competition from outside products in terms of display
packaging. The results of the study and the findings of the data
above can be concluded that the small-scale business of
limited liability companies in Palasah Village, Palasah
District, Majalengka Regency, West Java Province must try
harder to be able to compete and compete in the business
environment, because the competitors are no longer between
boundaries in one country but it has crossed the country,
thereby requiring guidance and assistance from the
government to win the competition. 5.1.3. Entrepreneurship
character in this research is in accordance with the formulation
of the problem and the goal can be concluded that the limited
liability small-scale entrepreneurs in Palasah Village, Palasah
District, Majalengka Regency, West Java, assume that the
dominant aspect of the key success of small businesses is the
entrepreneurial character of the business actors. , because with
a high and unique spirit and character of business, business
people will always update technology information, add
business networks, strive to consistently carry out their
commitment to entrepreneurship, have strong mental and
physical readiness in facing the era of trade and free
competition, and have enthusiasm and high fighting power in
maintaining its business. The results of the study and the
findings of the data above can be concluded that the small and
medium-sized entrepreneurs of limited liability companies in
Palasah Village, Palasah District, Majalengka Regency, West
Java Province have strong entrepreneurial characteristics in
order to win business competition, by sharpening all
dimensions of entrepreneurial character. 5.1.4. The company's
performance in this research is in accordance with the
formulation of the problem and its objectives and it can be
concluded that the limited liability small-scale businesses in
Palasah Village, Palasah District, Majalengka Regency, West
Java, assume that business performance is something that is
produced by the company in a certain period with standards
set. Small-scale business actors measure balanced
performance between financial and non-financial aspects. The
results of the study and the findings of the data above can be
concluded that the small and medium-sized businesses of
limited liability companies in Palasah Village, Palasah
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District, Majalengka Regency, West Java Province must try
harder to maintain their business from the financial aspects
including management of various financial needs plans,
financial resources for realize business continuity and
development, as well as sorting profits as small business
actors, as well as non-financial aspects which include
evaluating the growth of product marketing and improving the
quality and quantity of products to be able to maintain
business continuity and business development. 5.1.5. Small-
scale business limited liability company in Palasah Village,
Palasah Subdistrict, Majalengka Regency, West Java
Province, in this study is in accordance with the formulation of
the problem and its objectives and it can be concluded that the
limited liability small-scale business in Palasah Village,
Palasah District, Majalengka Regency, West Java must be able
to change its business organization to adapt better to internal
aspects (the influence of business capital and entrepreneurial
character) and external aspects (changes in the business
environment) in order to have optimal performance and
competitiveness to maintain the continuity and development of
its business. The strategy of a small and medium-sized
business limited liability company in Palasah Village, Palasah
District, Majalengka District, West Java Province, which has
been carried out by respondents in this study includes; aspects
of increasing access to productive assets, especially tangible
capital and intangible capital, the use of technology,
continuous improvement and management processes; aspects
of increasing access to the market, which includes a
comprehensive activity starting from business design and
reserve, information on market fluctuations, information on
effective and efficient production assistance, and marketing
infrastructure and facilities. And aspects of business
partnership, which are important and strategic pathways for
the development of people's economic businesses. The
partnership has proven to be successfully implemented in
developed countries, and has proven to be profitable for rapid
economic development and industrialization. The results of
the study and the findings of the data above can be concluded
that the small and medium-scale entrepreneurs of limited
liability companies in Palasah Village, Palasah District,
Majalengka District, West Java Province have begun to
explore backward linkages (the linkage of large businesses
with local small businesses). Optimization of the three
dimensions made in this study must be understood as a
learning process for small and medium-sized businesses of
limited liability companies in Palasah Village, Palasah
District, Majalengka District, West Java Province to maintain
business continuity and business development. 5.1.6. This
research succeeded in showing the magnitude of the influence
of venture capital, changes in the business environment, and
entrepreneurial character on company performance both
partially and simultaneously in small-scale limited liability
companies in Palasah Village, Palasah District, Majalengka
District, West Java Province. Partially this study shows that
the influence of business capital has an effect on company
performance by 25.51%, while changes in the business
environment affect the company's performance by 21.74%,
and entrepreneurial character influences the company's
performance by 26.16%. Simultaneously the influence of
venture capital, changes in the business environment, and
entrepreneurial character on company performance have an
effect of 73.41%. This study succeeded in providing a
theoretical description that the performance of a small and
medium-sized limited liability company in Palasah Village,
Palasah District, Majalengka Regency, West Java Province
was influenced by optimizing and maximizing utilization of
business capital, both tangible and intangible capital, as well
as business adjusting to changes in the dynamic business
environment in order to maintain business and have strong
business competitiveness. Likewise, the results of this study
prove that the small and medium businesses of limited liability
companies in Palasah Village, Palasah District, Majalengka
Regency, West Java Province have strong entrepreneurial
character, with the proven dominance of entrepreneurial
character variables influencing company performance.
5.1.7. This research succeeded in showing the magnitude of
the influence of the company's performance on the
development of a small-scale business limited liability
company in Palasah Village, Palasah District, Majalengka
Regency, West Java Province, 86.01%. The results of this
study indicate that a strong corporate performance seen from
the financial and non-financial aspects will have a significant
impact on the development of a small-scale limited liability
company in Palasah Village, Palasah District, Majalengka
Regency, West Java Province.
So that researchers can provide strong findings that business
performance influences business development, in accordance
with the theoretical opinion expressed by Prieto and Revilla
(2006) that the success indicator of the performance of small
and medium-sized enterprises is characterized by market
growth and quality improvement in product improvements.
This opinion is reinforced by the opinion of Kartasasmita
(2008) that small business actors can make observations,
imitate and modify products or packaging as a result of
partnership programs.
The performance of a small and medium-sized business
limited liability company can affect the development of a
small-scale business limited liability company in Palasah
Village, Palasah District, Majalengka Regency, West Java
Province, if the government really bridges between small
businesses and large companies to partner in various matters,
especially making small business producers product sub
elements from large companies. If this has already been
realized, the small business actors will try to evaluate the
performance of their business to create partnerships with large
companies as new opportunities to get their own market
segments.
5.2. Suggestion
In this section the researcher gives suggestions, departing from
several weaknesses that have been found:
5.2.1. The small-scale businessman of a limited liability
company in Palasah Village, Palasah District, Majalengka
Regency, West Java Province, has a dilemma regarding
International Journal of Basic & Applied Sciences IJBAS-IJENS Vol:19 No:02 66
190702-8484- IJBAS-IJENS @ April 2019 IJENS I J E N S
business capital because they always assume that the influence
of business capital is money or material, whereas theoretically
business capital is related to intellectual, social and moral, and
mentally, departing from the findings, the researchers
suggested that small and medium-sized businesses limited
liability companies to further increase their participation in
associations that were established or bring information closer
to the local District / City Industry and Trade Office. 5.2.2.
Small-scale entrepreneurs of limited liability companies in
Palasah Village, Palasah Subdistrict, Majalengka Regency,
West Java Province, are generally ready for changes in the
global environment, but the government needs to prepare
technology information infrastructure as a bridge to be able to
compete with external products, both from product aspects and
marketing aspects. 5.2.3. The small-scale businessman of a
limited liability company in Palasah Village, Palasah District,
Majalengka Regency, West Java Province has a good
character of entrepreneurship, this is evidenced by the many
small business actors who are able to survive with the
competitiveness, creativity and innovation of business actors,
so that entrepreneurial characteristics are only needed
increased commitment to decisions taken to secure the
decision that is being carried out as a limited liability small
and medium business in Palasah Village, Palasah District,
Majalengka District, West Java Province 5.2.4. The small-
scale businessman of a limited liability company in Palasah
Village, Palasah Sub-District, Majalengka District, West Java
Province already has quite a proud business performance both
from financial and non-financial aspects, the researcher
suggests that business people improve non-financial
performance aspects related to growth, improvement and the
quantity of the product to survive and even win competition
with foreign products, this also requires the role of the
government to provide protection to small-scale entrepreneurs
of limited liability companies in Palasah Village, Palasah
District, Majalengka District, West Java Province. 5.2.5.
Business development for small and medium businesses in
limited liability companies in Palasah Village, Palasah
Subdistrict, Majalengka District, West Java Province has
begun to show a desire to start the partnership process, but the
role of the government in this department is not optimal to
support the movement of partnership programs. whereas one
of the dominant indicators of business development is a
partnership program. This research requires seriousness and
concrete steps from the government to assist business
development. 5.2.6. The performance of the small and
medium-sized company of a limited liability company in
Palasah Village, Palasah District, Majalengka Regency, West
Java Province is influenced by business capital, changes in the
business environment, and entrepreneurial characteristics in
this study recommending related agencies in the district / city
to pay more attention to aspects of entrepreneurship and
intrapreneurs to prosper their society by paying more attention
to understanding business capital assistance, helping
information about changes in the business environment and
assisting the character of entrepreneurship starting at an early
age, for example by incorporating entrepreneurship programs
in the school curriculum at the primary and secondary
education level. 5.2.7. If the performance of a limited liability
small-scale business in Palasah Village, Palasah District,
Majalengka Regency, West Java Province is optimal, for
example in the company PT. Binhara Inti Nusa this
Majalengka Branch. So business development programs in the
form of partnerships as a dominant aspect in business
development must be escorted and supervised by the
government so that a mutual symbiosis process continues,
because partnership programs are found that are only carried
out and run when there are government elements but cannot
continue because they feel partnership programs are only
stimulant assistance.
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