Sustainable Business Performance for Local Business Development: Evidence from Indonesia Coffee Shops

Authors

  • Anisa Aprilia Department of Social Economics, Faculty of Agriculture, Brawijaya University
  • Fitrotul Laili Department Socio Economics, Faculty of Agriculture, Brawijaya University
  • Putri Budi Setyowati Department Socio Economics, Faculty of Agriculture, Brawijaya University
  • Adella Rania Salsabilah Department Socio Economics, Faculty of Agriculture, Brawijaya University
  • Ivonia Indah Armasari Department Socio Economics, Faculty of Agriculture, Brawijaya University

DOI:

https://doi.org/10.21776/ub.habitat.2023.034.1.3


Keywords:

digital organization, ethical sensitivity, finance, learning culture, sustainability

Abstract

Drawing on the concept of sustainable business performance, this study proposes a research model to investigate how variables such as digital organizational culture, organizational learning culture, ethical sensitivity, and access to finance contribute to the formation of a business performance model that is expected to contribute to long-term business performance in local industries dominated by coffee shops. The measure of sustainable business performance is the performance of economic, social, and environmental factors. The PLS-SEM approach was utilized to estimate this investigation's sustainable business performance model. The study examined 111 coffee shop owners, managers, and employees, selected based on their present position within the company, using a questionnaire distributed between July and November 2021. Several factors, including the organizational learning culture, the digital organizational culture, ethical awareness, and financial access, significantly influence the long-term financial performance of the coffee shop's business. This study contributes to the existing theory and the existing body of literature on topics such as the importance of ethical awareness, access to finance, digital organizational culture, and organizational learning culture. To improve overall business performance, business owners, managers, and even employees should examine the role that sustainable company performance plays in the development of each human resource's talents.

Author Biography

Anisa Aprilia, Department of Social Economics, Faculty of Agriculture, Brawijaya University

SCOPUS ID: 57220270436

https://www.scopus.com/authid/detail.uri?authorId=57220270436

https://scholar.google.co.id/citations?user=0Ut4KlYAAAAJ&hl=id 

ORCHID ID : 0000-0002-2035-0679

https://orcid.org/0000-0002-2035-0679

References

Adamu, A. A., Wan, C. Y., Gorondutse, A. H. 2019. Determinants of sustainable performance of SMEs: A proposed framework. International Journal of Research and Scientific Innovation, 6(6), 182–188.

Amrutha, V. N., & Geetha, S. N. 2020. A systematic review on green human resource management: Implications for social sustainability. Journal of Cleaner Production, 247, 119131. https://doi.org/10.1016/j.jclepro.2019.119131

Aprilia, Anisa., Laili, Fitrotul., Setyowati, P.B., Wardana, A.W., Waringga, K.F. 2020. The Effect of Environmental Uncertainty on Supply Chain Agility for Small and Medium-Sized Businesses (SMBs): Empirical Evidence on Coffee

Shops in Indonesia. (2020). European Journal of Business and Management. https://doi.org/10.7176/ejbm/12-33-08

Attia, A., & Essam Eldin, I. 2018. Organizational learning, knowledge management capability and supply chain management practices in the Saudi food industry. Journal of Knowledge Management, 22(6), 1217–1242. https://doi.org/10.1108/jkm-09-2017-0409

Aziza, N., & Salim, A. A. 2008. Pengaruh Orientasi Etika Pada Komitmen dan Sensitivitas Etika Auditor (Studi Empiris pada Auditor di Bengkulu dan Sumatera Selatan). Simposium Nasional Akuntansi 11, 1(1), 1–26.

Barros, M. V., Salvador, R., do Prado, G. F., de Francisco, A. C., & Piekarski, C. M. 2021. Circular economy as a driver to sustainable businesses. Cleaner Environmental Systems, 2, 100006. https://doi.org/10.1016/j.cesys.2020.100006

Brixiová, Z., Kangoye, T., & Yogo, T. U. 2020. Access to finance among small and medium-sized enterprises and job creation in Africa. Structural Change and Economic Dynamics, 55, 177–189. https://doi.org/10.1016/j.strueco.2020.08.008

Chen, C.-L., Lin, Y.-C., Chen, W.-H., Chao, C.-F., & Pandia, H. 2021. Role of Government to Enhance Digital Transformation in Small Service Business. Sustainability, 13(3), 1028. https://doi.org/10.3390/su13031028

Comin, L.C., Aguiar, C.C., Sehnem, S., Yusliza, M.-.-Y., Cazella, C.F. and Julkovski, D.J. 2020, "Sustainable business models: a literature review", Benchmarking: An International Journal, Vol. 27 No. 7, pp. 2028-2047. https://doi.org/10.1108/BIJ-12-2018-0384

Cosentino, A., Paoloni, P., Iannone, B., & Temperini, V. 2020. Tradition, innovation and relationships: emergent profiles from agro-food Italian industry. British Food Journal, 123(1), 279–299. https://doi.org/10.1108/bfj-04-2020-0306

Creswell, J. W. 2013. Qualitative inquiry and research design: Choosing among five approaches. SAGE Publications, Incorporated.

Danarahmanto, P. A., Primiana, I., Azis, Y., & Kaltum, U. 2020. The sustainable performance of the digital start-up company based on customer participation, innovation, and business model. Business: Theory and Practice, 21(1), 115-124. https://doi.org/10.3846/btp.2020.11053

Das, M., & Rangarajan, K. 2020. Impact of policy initiatives and collaborative synergy on sustainability and business growth of Indian SMEs. Indian Growth and Development Review, 13(3), 607–627. https://doi.org/10.1108/igdr-09-2019-0095

Das, M., Rangarajan, K., & Dutta, G. 2019. Corporate sustainability in small and medium-sized enterprises: a literature analysis and road ahead. Journal of Indian Business Research, 12(2), 271–300. https://doi.org/10.1108/jibr-09-2017-0166

Fernando, Y., Chiappetta Jabbour, C. J., & Wah, W.-X. 2019. Pursuing green growth in technology firms through the connections between environmental innovation and sustainable business performance: Does service capability matter? Resources, Conservation and Recycling, 141, 8–20. https://doi.org/10.1016/j.resconrec.2018.09.031

Fornell, C., & Larcker, D. F. 1981. Structural equation models with unobservable variables and measurement error: Algebra and statistics.

Fowowe, B. 2017. Access to finance and firm performance: Evidence from African countries. Review of Development Finance, 7(1), 6–17. https://doi.org/10.1016/j.rdf.2017.01.006

Geissdoerfer, M., Vladimirova, D., Evans, S. 2018. Sustainable business model innovation: a review. J. Clean. Prod., 198 , pp. 401-416. https://doi.org/10.1016/j.jclepro.2018.06.240

Grayson, D., Coulter, C. & Lee, M. 2018. All In: The Future of Business Leadership. Routledge, London

Gupta, H., Kumar, A., & Wasan, P. 2021. Industry 4.0, cleaner production and circular economy: An integrative framework for evaluating ethical and sustainable business performance of manufacturing organizations. Journal of Cleaner Production, 295, 126253. https://doi.org/10.1016/j.jclepro.2021.126253

Hahn, M. H., Lee, K. C., & Lee, D. S. 2015. Network structure, organizational learning culture, and employee creativity in system integration companies: The mediating effects of exploitation and exploration. Computers in Human Behavior, 42, 167–175. https://doi.org/10.1016/j.chb.2013.10.026

Hair Jr., J.F., Hult, G.T.M., Ringle, C.M., Starstedt, M. 2017. A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM), Second ed. SAGE Publications Inc., Los Angeles.

Haseeb, M., Hussain, H. I., Kot, S., Androniceanu, A., & Jermsittiparsert, K. 2019a. Role of Social and Technological Challenges in Achieving a Sustainable Competitive Advantage and Sustainable Business Performance. Sustainability, 11(14), 3811. https://doi.org/10.3390/su11143811

Haseeb, M., Hussain, H. I., Ślusarczyk, B., & Jermsittiparsert, K. 2019b. Industry 4.0: A Solution towards Technology Challenges of Sustainable Business Performance. Social Sciences, 8(5), 154. https://doi.org/10.3390/socsci8050154

Høgevold, N. M., Svensson, G., Klopper, H. B., Wagner, B., Valera, J. C. S., Padin, C., … Petzer, D. 2015. A triple bottom line construct and reasons for implementing sustainable business practices in companies and their business networks. Corporate Governance, 15(4), 427–443. https://doi.org/10.1108/cg-11-2014-0134

Hunt, S. D., & Vitell, S. J. 2006. The General Theory of Marketing Ethics: A Revision and Three Questions. Journal of Macromarketing, 26(2), 143–153. https://doi.org/10.1177/0276146706290923

Ibrahim, N., Shiratuddin, M. F., & Wong, K. W. 2015. Instruments for Measuring the Influence of Visual Persuasion: Validity and Reliability Tests. European Journal of Social Sciences Education and Research, 4(1), 25. https://doi.org/10.26417/ejser.v4i1.p25-37

Isensee, C., Teuteberg, F., Griese, K.-M., & Topi, C. 2020. The relationship between organizational culture, sustainability, and digitalization in SMEs: A systematic review. Journal of Cleaner Production, 275, 122944. https://doi.org/10.1016/j.jclepro.2020.122944

Joyce, A., & Paquin, R. L. 2016. The triple layered business model canvas: A tool to design more sustainable business models. Journal of Cleaner Production, 135, 1474–1486. https://doi.org/10.1016/j.jclepro.2016.06.067

Kasimin, Suyanti. 2017. Coffee Shop’s Characteristic and Factors that Influence the Number of Visitors and Profit Level of Popular Coffee Shops in Banda Aceh City. Proceedings of The 7th Annual International Conference (AIC) Syiah Kuala University and The 6th International Conference on Multidisciplinary Research (ICMR) in conjunction with the International Conference on Electrical Engineering and Informatics (ICELTICs) 2017, October 18-20, 2017, Banda Aceh, Indonesia

Khan, S. U. 2022. Financing constraints and firm-level responses to the COVID-19 pandemic: International evidence. Research in International Business and Finance, 59, 101545. https://doi.org/10.1016/j.ribaf.2021.101545

Kumar, R., Singh, R. K., & Dwivedi, Y. K. 2020. Application of industry 4.0 technologies in SMEs for ethical and sustainable operations: Analysis of challenges. Journal of Cleaner Production, 275, 124063. https://doi.org/10.1016/j.jclepro.2020.124063

Luthra, S., Mangla, S. K., Lopes de Sousa Jabbour, A. B., & Huisingh, D. 2021. Industry 4.0, Cleaner Production, and Circular Economy: An important agenda for improved Ethical Business Development. Journal of Cleaner Production, 326, 129370. https://doi.org/10.1016/j.jclepro.2021.129370

Martínez-Caro, E., Cegarra-Navarro, J. G., & Alfonso-Ruiz, F. J. 2020. Digital technologies and firm performance: The role of digital organisational culture. Technological Forecasting and Social Change, 154, 119962. https://doi.org/10.1016/j.techfore.2020.119962

Ministry of Cooperatives and Small Enterprises and Intermediate (Kementerian Koperasi dan Usaha Kecil dan Menengah). 2019. Perkembangan Data Usaha Mikro, Kecil, Menengah (Umkm) dan Usaha Besar (Ub) Tahun 2018 – 2019. http://kemenkopukm.go.id/uploads/laporan/1617162002_SANDINGAN_DATA_UMKM_2018-2019.pdf

Naqshbandi, M. M., & Tabche, I. 2018. The interplay of leadership, absorptive capacity, and organizational learning culture in open innovation: Testing a moderated mediation model. Technological Forecasting and Social Change, 133, 156–167. https://doi.org/10.1016/j.techfore.2018.03.017

Nawaz, S., Della Selva, V., & Savino, M. M. 2016. Extensive literature review to investigate the dimensions of business sustainability. International Journal of Operations and Quantitative Management, 22(3), 273–302.

Quintero-Angel, M., Peña-Montoya, C. C., Fajardo-Toro, C. H., & Aguilera-Castillo, A. 2018. Opportunities and Challenges for Sustainable Business Strategic Planning in Small and Medium Enterprises (SMEs). Green Production Strategies for Sustainability, 153–167. https://doi.org/10.4018/978-1-5225-3537-9.ch009

Saeed, F.T., & Kassim, R.M. 2017. Validation Measurement Model of Media Staffs Satisfaction, Leadership, Pay, Working Environment, Rewards and Performance. World Journal of Research and Review (WJRR), 5(3), 84–88.

Savitri, E. 2018. Relationship between family ownership, agency costs towards financial performance and business strategy as mediation. Business: Theory and Practice, 19, 49-58. https://doi.org/10.3846/btp.2018.06

Schoenherr, T. 2012. The role of environmental management in sustainable business development: A multi-country investigation. International Journal of Production Economics, 140(1), 116–128. https://doi.org/10.1016/j.ijpe.2011.04.009

Sekaran, U., & Bougie, R. 2016. Research Methods for Business: A Skill-Building Approach (7th ed.). New Jersey: Wiley.

Shariff, M. N. M., Ahmad, N. R., & Shabbir, M. S. 2020. Moderating effect of access to finance of the gem and jewelry industry. Utopia y Praxis Latinoamericana, 25(Extra2),

Singh, G., Sharma, S., Sharma, R., & Dwivedi, Y. K. 2021. Investigating environmental sustainability in small family-owned businesses: Integration of religiosity, ethical judgment, and theory of planned behavior. Technological Forecasting and Social Change, 173, 121094. https://doi.org/10.1016/j.techfore.2021.121094

Škerlavaj, M., Song, J. H., & Lee, Y. 2010. Organizational learning culture, innovative culture and innovations in South Korean firms. Expert Systems with Applications, 37(9), 6390–6403. https://doi.org/10.1016/j.eswa.2010.02.080

Stankevičius, A., Novikovas, A., Bakaveckas, A., & Petryshyn, O. 2020. EU waste regulation in the context of the circular economy: peculiarities of interaction. Entrepreneurship and Sustainability Issues, 8(2), 533–545. https://doi.org/10.9770/jesi.2020.8.2(32)

Tentama, Fatwa and Anindita, Wiwid. 2020. Employability scale: Construct validity and reliability. International Journal of Scientific and Technology Research, 9 (04). pp. 3166-3170.

Toti, J.-F., Diallo, M. F., & Huaman-Ramirez, R. 2021. Ethical sensitivity in consumers’ decision-making: The mediating and moderating role of internal locus of control. Journal of Business Research, 131, 168–182. https://doi.org/10.1016/j.jbusres.2021.03.045

Upadhyay, P., & Kumar, A. 2020. The intermediating role of organizational culture and internal analytical knowledge between the capability of big data analytics and a firm’s performance. International Journal of Information Management, 52, 102100. https://doi.org/10.1016/j.ijinfomgt.2020.102100

Ursachi, G., Horodnic, I. A., & Zait, A. 2015. How Reliable are Measurement Scales? External Factors with Indirect Influence on Reliability Estimators. Procedia Economics and Finance, 20(15), 679–686. https://doi.org/10.1016/s2212-5671(15)00123-9

Wadu, L. B., Ladamay, I., & Bandut, S. 2020. Keterlibatan Warga Negara Dalam Pembangunan Berkelanjutan Melalui Produksi Gula Aren. Jurnal Civic Hukum, 5(1), 24. https://doi.org/10.22219/jch.v5i1.11476

Zecca, F., & Rastorgueva, N. 2017. Knowledge management and sustainable agriculture: The Italian case. Quality Access to Success, 18 (159), 97-104.

Zgrzywa-Ziemak, A., & Walecka-Jankowska, K. 2020. The relationship between organizational learning and sustainable performance: an empirical examination. Journal of Workplace Learning, 33(3), 155–179. https://doi.org/10.1108/JWL-05-2020-0077

Zoppelletto, A., Bullini Orlandi, L., & Rossignoli, C. 2020. Adopting a digital transformation strategy to enhance business network commons regeneration: an explorative case study. TQM Journal, 32(4), 561–585. https://doi.org/10.1108/TQM-04-2020-0077

Downloads

Published

2023-05-22

How to Cite

Aprilia, A., Fitrotul Laili, Putri Budi Setyowati, Adella Rania Salsabilah, & Ivonia Indah Armasari. (2023). Sustainable Business Performance for Local Business Development: Evidence from Indonesia Coffee Shops. HABITAT, 34(1), 23–37. https://doi.org/10.21776/ub.habitat.2023.034.1.3

Issue

Section

Articles

Most read articles by the same author(s)