The Effect of Entrepreneurial Mindset, Digital Training and Supervision on the Competitiveness of Small and Medium Enterprises (SME) for Women

Abstract

The Cikal Incubator Business has been preparing and developing many communities Small and Medium Enterprises (SMEs) for years. The SMEs under Cikal were trained and supervised periodically in order to allow them to reach a better level of competitiveness in the market. This research aimed to assess the aspects of mindset, strategies, and competitiveness in the women's SMEs under Cikal Universitas Sumatera Utara. A total of 42 SMEs participated in this research. The data collection techniques included questionnaires and interviews focused on the implementation of SMEs. Descriptive analysis was used to evaluate our findings. The results of this research have a satisfying result. Most of the women-owned SMEs under the Cikal Incubator Business have been developing a good mindset towards business, especially their business control and the ability to learn from the business obstacles encountered. For the strategic aspects, most of our participants were able to evaluate the internal and external, as well as market, forces to help their business. As for competitiveness, this research showed that under self-assessment, all of our SMEs were ready for a competitive market. This shows that the mindset related to the desire to succeed should involve the SMEs having mature and structured strategies that are planned by the actors of the SMEs to allow them to be able to create competitiveness in the SMEs in the market. Thus, the Cikal Business Incubator helped the SMEs to be successful.

Headnote

Abstract

The Cikal Incubator Business has been preparing and developing many communities Small and Medium Enterprises (SMEs) for years. The SMEs under Cikal were trained and supervised periodically in order to allow them to reach a better level of competitiveness in the market. This research aimed to assess the aspects of mindset, strategies, and competitiveness in the women's SMEs under Cikal Universitas Sumatera Utara. A total of 42 SMEs participated in this research. The data collection techniques included questionnaires and interviews focused on the implementation of SMEs. Descriptive analysis was used to evaluate our findings. The results of this research have a satisfying result. Most of the women-owned SMEs under the Cikal Incubator Business have been developing a good mindset towards business, especially their business control and the ability to learn from the business obstacles encountered. For the strategic aspects, most of our participants were able to evaluate the internal and external, as well as market, forces to help their business. As for competitiveness, this research showed that under self-assessment, all of our SMEs were ready for a competitive market. This shows that the mindset related to the desire to succeed should involve the SMEs having mature and structured strategies that are planned by the actors of the SMEs to allow them to be able to create competitiveness in the SMEs in the market. Thus, the Cikal Business Incubator helped the SMEs to be successful.

Keywords: Entrepreneurial mindset, Strategy, Competitiveness, Small and Medium Enterprises

Introduction

The results of the previous studies regarding the model used in the development and enhancement of product competitiveness by the SMEs entrepreneurs have turned out to have an impact on the competitiveness of the rattan entrepreneurs (Dalimunthe, 2017). Based on these results, the researchers wanted to examine the competitiveness of the women-owned SMEs who were members of the Universitas Sumatera Utara (USU) Incubator Centre who had been given training in entrepreneurship and mentoring to improve their business quality to improve their business competitiveness. Competitiveness is a force that should exist in an entrepreneur so then the products produced can excel in their business when compared to their competitors in the market. According to Kuncoro (1997: 91), the competitiveness of companies shows the company's position in the context of the industrial competition. According to Dalimunthe (2019), competitiveness is a strength that must exist in an entrepreneur so then the products produced can be superior when compared to competitors in the market. Entrepreneurship refers to an entrepreneur who has an entrepreneurial spirit. This will help them to see opportunities to allow them to understand the market desires (Kotler, 2009). According to Shane and Venkataraman (2000), entrepreneurship is a dynamic process of innovation, the recognition of existing opportunities and the creation of new businesses in creating wealth. It includes the assumption of risks and rewards for new businesses. Competitors require that an entrepreneur be observant when fulfilling the market desires. They need to have a creative and innovative mindset. This is done in order to increase competitiveness for businesses.

By enhancing the competitiveness of the women's SMEs, an entrepreneurial mindset needs to be built. A mindset is a set of beliefs or ways of thinking that influence a person's behaviour and attitudes. This will ultimately determine the level of success in their life. (Adi W. Gunawan, in Modul Pendidikan dan Pelatihan Kepemimpinan Tingkat III 2011). According to Dalimunthe (2018), mindset is a way of looking at someone who is captured by the senses that is found in attitudes and behaviour.

It can be concluded that mindset is a way of thinking about someone who will influence behaviour and attitudes. This will determine the way of life that will be taken by someone.

In addition to the entrepreneurial mindset that SMEs or entrepreneurs must have to increase their business competitiveness, they need a strategy that will strengthen the competitiveness of the business. Strategic entrepreneurship is a combination of behaviours that allows them to seek opportunities and competitive advantages simultaneously (Ireland and Web, 2007). According to David (2011), strategy is used together with long-term goals by a person or company. Rangkuti (2013) argues that a strategy is a comprehensive master plan which explains the way that the company achieves all of the goals set based on the mission that has been determined by a person or the company as a whole. Based on the two understandings according to the expert as aforementioned, it can be concluded that a strategy is a method used by a person or company to achieve success based on the vision and mission that has been determined previously. The strategy thus becomes an important aspect involved in determining the competitiveness of companies or SMEs in the market to allow it to reach a wider market share.

On this matter, a study was designed to evaluate the competitiveness of women's SMEs who are members of the Universitas Sumatera Utara (USU) Incubator Centre which has been giving training on entrepreneurship and mentoring in improving business quality and business competitiveness. This research aimed to assess the current competitiveness of women's entrepreneurship under the Cikal business incubator program as well as assessing the benefits of partnering businesses with Cikal. Therefore, it was necessary to create a model on the development and enhancement of competitiveness that was built in the long-term. It will be able to build a profit-generating business which will benefit many people through a sustainable business. SMEs can use this to become a big business in the long run and they will be able to produce a business model in practice with the help of a strategy-based entrepreneur. This research has become important to evaluate the current situation within Cikal SMEs as well as suggesting a plan to improve SME competitiveness in the future.

Method

The research was conducted at the women's SMEs Business Incubator Centre of the Universitas Sumatera Utara in Medan. The research was conducted over the period of March-October 2018. This research was conducted with a qualitative approach, namely by using data collection methods such as study documentation, interviews and observations.

As we identified before, the object of this research were women business owners who had been partnered with Cikal for at least 2 years. In their time under the Cikal Business Incubator, they have been receiving training and development related to their entrepreneurial abilities. This research examined their perception and knowledge of their business mindset, strategic aspect and competitiveness aspect.

The research instruments used in the questionnaire were benchmarks, namely the aspects of mindset, strategy and competitiveness within the women's SMEs. The following are the operational definitions and indicators used in the study.

The Aspect of Mindset is the way of thinking of SMEs that will influence the behaviour and attitudes of the SMEs. This will determine the way of life that will be taken on by SMEs in the future. These aspects include their Control locus, Tolerance for ambiguity, Making changes, Consistency, Creativity, Willingness to hire smarter people, Seeing chances and opportunities, Innovation, Maintaining ideas, Tough when trying, Optimistic, and the Ability to laugh at yourself. The Aspect of Strategy is used by the SMEs to achieve success based on the vision and mission that has been previously set. These aspects evaluate their behaviour to allow them to Focus on the target market, Production strategy, Promotion strategy, Product quality, Discipline and Consistency when running a business. This is in addition to Difficulties in the biography which is a responsibility of the business, Focus on the customers, Aspects on the market, Market prospects, Internal and external environmental assessments, the Mapping of competitors, the Legalisation of business, Strategy formulations in the long term and short term and Having a vision and mission.

The Aspects of Competitiveness refer to the strength that should be present in SMEs so then the products produced can excel in their business when compared to their competitors in the market. These aspects can be used evaluate their competitiveness through the product value in the eyes of their consumers, the experience that the consumers feel when analysing the products and the services provided.

To analyse the data in this research with a qualitative approach, we used a descriptive analysis method. The descriptive qualitative analysis is a method of analysis that seeks to find thorough relations within a situation. In this study, the actual power will be collected and then compiled. Classification and interpretation will be carried to solve the problem under study, and then from this data we will obtain an overview and information about the problem.

Description of the Respondent's Characteristics

In this study, the characteristics of the respondents were based on age, education and the length of the business having been open.

Based on the table, it shows that the respondents who have an age in the range from 36 - 45 years old constitute the majority of the entrepreneurs in the area. This age is classified as still being an active age for work and this will be very good for developing business. They will be able to quickly adapt to technology through mentoring and training. The age range that has the least amount of entrepreneurship is 56 - 65 years old. This is because this age range includes old age, so most of the mothers in this age range will choose to become housewives instead. Yet when they are still strong and healthy, opening up a business at this age will be a legacy for their children and grandchildren later on. For the age range of 26 - 35 years old, there are still a few who have become entrepreneurs. This happens because in general, this age is made up of people who are actively working or who prefer to be an employee in a large company rather than being an entrepreneur. For the age range of 46-55 years old, this is the second most common age range. This happens because for many of this age, they are mothers who are no longer working but who are still active in terms of home production. They choose to open up a business to increase the household income.

In addition to being based on age, the characteristics of the respondents based on education show that the majority of the respondents have an elementary level degree. For junior high school, there were 3 respondents who had become entrepreneurs. For high school graduates, there were 27 respondents who had become entrepreneurs. For D3, there were three respondents and for S1, there were also 3 respondents who had become entrepreneurs. For S2, there was only 1 respondent who had become an entrepreneur. This means that the majority of entrepreneurs in the area have completed a high school level of education.

The characteristics of the respondents based on the length of opening a business show that for the span of time of less than 2 years, there were no respondents. For a period of 2-5 years, there were 27 respondents. This shows that there are many new entrepreneurs who are still in the beginning stage, so assistance and training are necessary. Furthermore, for the period of 6-9 years, there were 9 respondents. The time span of 6-9 years is generally the time period in which a business is developing. So it needs supervision and the ability to survive. The period of 10-13 years is a business that has lasted for a long time and for this period, there were 5 respondents who were shown to be able to open a business. Finally, among the respondents studied, there was 1 respondent who had had a business for 14-17 years. Businesses like this will usually be able to continue if the management is well done. To make the business more developed, it is necessary to provide assistance and training, especially for businesses that do not have brands and logos. With a brand and logo, the business will be more easily known and remembered by the consumers. When they want to market their products online, it won't be easy for someone to copy or claim the business idea because they will already have their own logo and brand that is distinct.

Descriptive analysis results

The research was conducted on 42 women SME participants who were members of the North Sumatra University (USU) Cikal Incubator Centre. We obtained good results.

Based on the results obtained from the descriptive analysis on the aspect of mindset, it shows that all 42 participants answered "Yes" with a percentage of 100% in question 1 regarding internal control and point 10 regarding the barriers / challenges to be learned. The smallest percentage was found in point 9 regarding the courage to take action in a business opportunity that is equal to 69% (29 participants answered "Yes") and 31% (13 participants answered "No"). For the other points, they were in the range of 72% - 79% regarding the participants who answered "Yes".

The results, which reflect our participants' aspects of entrepreneurial mindset, show that they believed in a degree of external control over the business. They also believe that creativity has been growing within themselves. Most of our participants also discovered their abilities and potential compared with before they joined Cikal. Instead of becoming a lone-wolf in business, they believe that cooperating with smart people will bring in more opportunities. Most of them also believe in the importance of integrity, innovation and being optimistic while running the business.

Based on Table 2, the results of the distributive analysis carried out on the aspect of strategy show that there are five points indicating that all participants, 42 people, answered "Yes" with a percentage of 100%. The five points are point 3 regarding good production strategies, point 4 regarding promotion strategies, point 5 regarding product quality and point 11 regarding market prospects. For the points that were answered with "Yes" with the lowest presentation, there were two points, namely point 20 regarding having a brand with 52% with participants answering "Yes" (22 people) and 20 people answering "No". Point 21 regarding trademarks registered with the Ministry of Law and Human Rights was answered by 57% with the number of participants totalling 24 people who answered "Yes" and 18 people who answered "No" with a percentage of 43%.

The other aspects of strategy showed that, in most cases, they were surprisingly good with the questions given to them. Most of them were able to focus on their target market while assessing the prices in order to gain a competitive advantage. They also built discipline and consistency in their business. However, they believed that difficulties in affairs related to bureaucracy might hinder their strategies. In order to meet the requirement of competitiveness, they assessed their internal and external situation while building up their strategic planning.

Table 2 shows the results of the research on competitiveness. The results obtained show that all of the participants responding with "Yes" to each question point which is equal to 100% with the number of participants totalling 42 people. This result indicates that from the point of view of business owners, they evaluate themselves as being more than competitive enough in the market. They believe that the products are valuable from the perspective of the customers as well as happy with the products or services provided to the customers. They believe that their customers feel the same way, which is that they feel good about the shopping experience provided to the customers. They also believe that they are unique compared to other competitors in market which will allow them to be able to meet their customer's expectations, which improves their service excellence. From this result, it can be seen that the SMEs of women who are members of the Cikal Incubator Centre have been able to increase their competitiveness in accordance with the self-assessment. This can be done because the SMEs already understand the factors that affect the competitiveness of SMEs.

Discussion

The competitiveness of a SME can be seen from the results of the research and the descriptive analysis conducted. In this study, two independent variables were used in order to see their effect on the competitiveness of women's SMEs incorporated in the University of North Sumatra (USU) Incubator Centre, namely the aspects of mindset and strategy. The mindset possessed by the SMEs is one of the important factors that SMEs need to consider when running their business. This is especially so when seeking to increase their competitiveness in the market. Mindset is a person's perspective when seeing things or in this case, when seeing the competitiveness of entrepreneurship in the women's SMEs. A strong mindset about the importance of success in building a business will be a driver in increasing competitiveness. Dweck (2006), "The views of people who are adopted for themselves greatly influence the way that people connect life". This means that the mindset of a person will affect how they deal with life.

The results obtained in the descriptive analysis on the indicator of the locus of control shows that in running a business, there is a need for a control locus. The control locus is a person's belief related to controlling his or her own behaviour from outside of themselves. Robbin and Judge (2008: 138) explain that locus of control is a level of confidence in individuals that they are the determinants of their own destiny. In addition to the control locus, the indicator that got a large percentage of the results was optimism, where it is perceived that obstacles and challenges are meaningful lessons. Early entrepreneurship activity can be driven by both opportunity recognition and necessity (Rubech,et.all :2015), as well as the ability to overcome obstacles and challenges. An SMEs actor often feels that obstacles or challenges are a lesson that can be used as at reference in decision making so then it does not occur again or so they can find ways to overcome any obstacles that can arise. According to Gibbons (2005), entrepreneurs make their decisions through a series of actions and alternatives that may occur that can be used. They also do so by considering the various natural conditions and seeking to optimise the function of certain objectives. This means that entrepreneurs, when making decisions in their business, are faced with challenges related to being able to optimise the function of the objectives that have been prepared. In overcoming the obstacles and challenges, there needs to be creativity and innovation. According to Robinson and Stubberud (2015), creativity and innovation, together with the challenges of risk taking and proactiveness, are important elements in entrepreneurial orientation. Behaviour in innovating and incorporating innovative technologies for new business entrepreneurs has been linked to the enhanced ability to overcome obstacles and challenges when managing the resources or competitive losses that characterise new companies, to further analyse and improve markets or new products, to improve information and acquisitions knowledge, and to improve the overall competitiveness of the business in the market (Cliff et al., 2006; Liao and Welsch, 2008).

Furthermore, the second variable that affects competitiveness is strategy. The strategy possessed by SMEs is the way that the SMEs achieve their intended SMEs goals. Before making a strategy, SWOT Analysis is needed. This is an analysis of the strengths, weaknesses, opportunities and threats that come from inside and outside of the SMEs. Based on the results of the descriptive analysis carried out, it shows that the training strategy indicators obtained very good results on the percentage of descriptive analysis. This is because training in an SME is something that is necessary for carrying out its business. The business must continue to run and continually develop. According to Andrew E. Sikula in Hasibuan (2003: 69), training is the process of short-term education using systematic and organised procedures so then the human resources learn knowledge related to workmanship techniques and expertise for specific purposes. In addition to the training strategy indicators, there were also indicators for promotion, quality and product market prospects that also achieved very good percentage results compared to the other indicators. This shows that the used strategy requires a promotion that can attract consumers to buy or use the products / services from the SMEs. This needs to be followed by good product quality because good product quality will be able to make the consumers feel satisfied that they have used the finest products that the SMEs offer. This will make them interested in buying the product again which will be able to increase their competitiveness in the market. Market prospects are the opportunities that can occur in the markets. Good market prospects will also increase the competitiveness of the SMEs in the market. Therefore, the prospects of the products owned by SMEs in the market need to be reviewed so then appropriate strategies can be developed to improve the competitiveness of the SMEs. The main strategy is the proximity of the customer (Pelham, 1997), which is combined with more specific strategies oriented towards the opportunity for sales and/or the originality of the products or services (Jordan, 2018).

The results of the descriptive analysis show that the value of the product in the eyes of consumers will result in more frequent repurchases. This will automatically increase the competitiveness of the SMEs with other SMEs. When the consumers can judge that the product offered is very good, consumers will get pleasure from the products and business that the SMEs offer. The pleasure and satisfaction felt by consumers is something that needs to be maintained for SMEs. When the consumers are not satisfied, this will have an impact on the sale of the SMEs. Besides that, the experience felt by the consumers regarding the product or business that you are running can be used to measure the competitiveness of the SMEs. Good or bad experiences that the consumers perceive, as well as giving satisfaction to the consumers, is important, therefore the SMEs must always pay attention to consumer desires. Consumers are king. Consumers need to be served well in order to obtain pleasure and good experiences. According Sangadji and Sopiah (2013: 329, there is some element of consumer perceived value related to the quality of the product, price, quality of service, emotional factors, and easiness.

For this reason, in terms of enhancing the competitiveness of SMEs, women who are members of the North Sumatra (USU) Cikal Incubator Centre need to develop a mindset that supports the SMEs in carrying out their business. Training should be provided on how to build a good strategy to increase the competitiveness of the SMEs in the market.

Conclusion

Based on the results of the research conducted, it can be concluded that mindset is mainly based on the indicators of control loci, with obstacles or challenges as the supporting factors in terms of increasing the competitiveness of women's Cikal USU SMEs. Mindset is the perspective of an SME actor who is indispensable at maintaining and improving the business.

Furthermore, the strategy drawn from the results of the study shows that in order to improve competitiveness, a mature strategy is needed so then the business can compete in the market. The most influential strategy indicators are training, promotion, product quality, and market prospects. Every SME actor needs training on how to run a business. This is so as to be able to carry out promotions that can attract consumers, to allow them to provide quality products that can make the consumers satisfied with the SMEs products and to allow them to be able to create new market prospects so then they can become leaders in their fields.

For the competitiveness of the results in the descriptive analysis, it was found that it is necessary to create value in the SMEs products for the purpose of attracting consumers. When the value of the product is good in the sight of the consumers, they can enjoy themselves and the products that have been purchased. Their experience can be based on the services provided or the products offered. When this can be built and enhanced by the SMEs doing business, the SMEs can compete in the market.

Due to the limited time that the researcher had for conducting the research, the researcher only used two variables to see the effect on business competitiveness, namely aspects of mindset and strategy aspects. The researchers suggest that further researchers can add other variables related to increasing the competitiveness of women's SMEs products. The variables that the researcher recommends are product packaging and service to the SMEs.

Acknowledgements

The success of this writing cannot be separated from the assistance given by various parties. The author would like to thank University of Sumatera Utara, which provided the motivation to conduct scientific research on gender issues and many of the suggestions found in this writing.

References

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