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Striving for excellence
Edited by Garth Cant
Introduction
In the classical paradigm it is stated that the development of an economy depends on two main factors (as explicitly included in a general Cobb Douglas production function), namely labor and capital (with advanced technology embodied). Later, after looking at the development miracle in the so-called the newly industrialized Asian countries, such as Chinese Taipei (Taiwan), Hong Kong - China and South Korea in the 1960s and 1970s, and the widening gap in development between developed/industrialized nations and less developed countries (LDCs), new thinking emerged in the 1980s on the nature of economic development and factors determining it. In this new paradigm, it is stated that in addition to the above two classical production factors, there is also another crucial factor, namely entrepreneurship. Nowadays, the development of entrepreneurship together with human skills improvement have become two crucial factors for sustainable economic and social development and for world leadership in all aspects of the modern state.
Recently, entrepreneurship development has been generally recognized as an important impulse factor for the sustainable economic development in Indonesia. It is often said that the lack of entrepreneurship has been the main cause for Indonesia's slow economic development compared with other Asian countries such as Malaysia, Thailand, China, South Korea, and Singapore. Realizing this, supporting small and medium enterprises (SMEs) in Indonesia has been adopted as a strategy to develop entrepreneurship in the country.
Entrepreneurship development has become more crucial to face the global business environment which is changing dramatically. Traditionally, competition in international markets was the realm of large enterprises (LEs), while SMEs remained local or regional in scope. The removal of government-imposed barriers that segregated domestic and international markets, technological advances in manufacturing, transportation, and telecommunications allow SMEs to actively involve in global business activities either through trade or business collaborations with foreign companies. This changing global business environment also creates opportunities as well as challenges to Indonesian SMEs.
The main aim of this paper is to examine the importance of networks for the export-oriented SME clusters in Indonesia. Networking is a powerful tool for the entrepreneur in all sizes ([19] Dubini and Aldrich, 1991), and for international entrepreneurs, networks, and cooperation are believed by some scholars to be essential...