Industrial Dynamics & Innovation journal

Institutional Collaboration Model between BUMDes and MSMEs: A Descriptive Study on the Integrated Village Economic Ecosystem

Haryati Haryati — Thu, 28 Aug 2025 00:00:00 +0000

Institutional collaboration between Village-Owned Enterprises (BUMDes) and Micro, Small, and Medium Enterprises (MSMEs) is regarded as a strategic approach to fostering a competitive and sustainable village economy. Despite its potential, the practice of institutional integration encounters several challenges, including structural, cultural, and coordination issues. This study aims to examine the collaboration models between BUMDes and MSMEs within villages that adopt an integrated economic approach. Employing a descriptive qualitative methodology, the research was conducted through case studies in three villages demonstrating successful institutional integration in local resource management and community economic empowerment. The findings reveal that the collaboration's success is significantly influenced by the alignment of institutional visions, the flexibility inherent in BUMDes structures, and the active participation of MSMEs in planning and decision-making processes. Quantitatively, the villages experienced an average increase of 25% in MSME turnover within one year of implementing the collaboration model. Based on these results, this study proposes a conceptual model of institutional collaboration encompassing coordinative, participatory, and adaptive dimensions, along with policy recommendations to enhance the village economy through strengthening local institutional networks.

Social Innovation Transformation in Rural MSMEs: A Qualitative Study of Innovative Practices of Village-Owned Enterprises Post-Pandemic

Feri Hardiyanto — Thu, 28 Aug 2025 00:00:00 +0000

The COVID-19 pandemic has forced various economic sectors, including rural MSMEs, to rapidly adapt to social and economic disruptions. Village-Owned Enterprises (BUMDes), as local economic institutions, were also impacted; however, a number of them demonstrated extraordinary resilience and capacity for social innovation to sustain and expand their businesses. This study aims to examine how social innovation transformations have occurred in BUMDes practices post-pandemic, particularly in the context of community-based micro and household enterprises. Using a descriptive qualitative approach, this research employed in-depth case studies of three BUMDes located in different rural areas. Data were collected through in-depth interviews with managers and community members, participant observation, and analysis of institutional documents.The findings indicate that social innovation in BUMDes is reflected not only in new product development and technology adoption, but also in adaptive distribution networks, collaborative partnerships with farmer groups and local cooperatives, as well as innovative governance practices rooted in values such as gotong royong (mutual cooperation) and community solidarity. For instance, two BUMDes successfully converted traditional products into health-related goods during the pandemic, while another established digital-based marketing platforms to reach urban consumers. These practices contributed to maintaining household income levels and reducing vulnerability, even as more than 70% of rural MSMEs reported declining turnover nationally (Bank Indonesia, 2021).Theoretically, this study enriches the literature on rural social innovation by offering an alternative perspective beyond urban and high-tech contexts, emphasizing the socio-cultural foundations of innovation. Policy-wise, the research provides practical insights for designing inclusive, participatory, and innovation-based village development strategies. The novelty of this study lies in presenting a typology of village-level social innovation that integrates economic adaptation with local cultural values, an aspect that has received limited attention in prior studies.

Resilience of Home Industries to Digital Disruption: A Narrative Study of Women Entrepreneurs in Rural Areas

Maulina nabila — Thu, 28 Aug 2025 00:00:00 +0000

Home industries are among the most frequently engaged micro-enterprises involving women, especially in rural areas of Indonesia. Despite their significant potential to improve community welfare, the sustainability of these small businesses faces substantial challenges due to digital disruption that has accelerated over the past decade, particularly exacerbated by the COVID-19 pandemic. Changes in technology, digital markets, and consumption patterns have transformed the dynamics of small-scale enterprises in rural areas, requiring entrepreneurs to adapt in order to survive and grow. This study aims to examine the resilience strategies developed by women entrepreneurs in home industries in response to these challenges. Using a qualitative narrative approach, the research was conducted with five female entrepreneurs across three rural regions in Indonesia. The findings indicate that resilience is built through a combination of social capital, gradual technological adaptation, and involvement of family and community-based informal networks. Additionally, the study highlights the importance of village institutional support in providing safe and inclusive digital learning spaces for women. Conceptually, this research introduces a narrative model of resilience based on gender and locality within the context of digital transformation of small industries, which can serve as a reference for policy development and empowerment programs for women in rural areas. The findings contribute significantly to the literature on social resilience and innovation in the micro-enterprise sector, offering practical strategies for entrepreneurs and stakeholders to strengthen the resilience of small businesses in the digital era.

The Dynamics of Adaptive Leadership in the Local Creative Industry: A Case Study of the Artisan Community in the Rural Batik Center

Nur Saebah — Thu, 28 Aug 2025 00:00:00 +0000

Local creative industries in rural areas play a crucial role in supporting community economies and preserving cultural heritage. However, the rapid impacts of globalization, digitalization, and crises such as the COVID-19 pandemic have exposed the limited understanding of how leadership within these communities adapts to ongoing social, technological, and economic changes. Addressing this gap, this study explores the dynamics of adaptive leadership among batik artisan communities in rural batik centers, emphasizing how local leaders manage transformation processes amid complex challenges. Employing a descriptive qualitative approach and case study method, data were collected through in-depth interviews, participant observation, and community documentation. Findings indicate that effective adaptive leadership is characterized by the ability to build trust, foster collective participation, and bridge the gap between tradition and innovation. This study contributes to the theoretical understanding of leadership in rural creative sectors by highlighting contextual adaptive strategies, and offers practical implications for policymakers and community development practitioners in designing leadership training and support programs tailored to local cultural contexts. Overall, this research underscores the importance of fostering resilient leadership to sustain and empower community-based creative industries in rural settings.

Organizational Innovation in Family-Based Business Communities: A Qualitative Study of Adaptation Patterns to Local Market Changes

Dayuni Dayuni — Thu, 28 Aug 2025 00:00:00 +0000

Family-based business communities play a vital role in shaping local economic structures, especially in rural and peri-urban areas. However, pressures from changing local markets, digitalization, and socio-economic disruptions are necessitating innovation in organizational structures and processes within these communities. This study aims to explore patterns of organizational adaptation among family-based business communities in response to these market changes. Employing a qualitative, descriptive approach through case studies of three family business communities in semi-urban Indonesia, the research uncovers that organizational innovation extends beyond technological solutions to include relational, structural, and social dimensions. The adaptation process involves reorganizing family roles, diversifying networks, and modifying internal work cultures. The findings contribute to theoretical understanding by highlighting the significance of social capital and structural innovation in informal sectors. Practically, the study emphasizes the importance of fostering relational trust and flexible organizational structures to enhance resilience and sustainability. This research offers valuable insights for policymakers and practitioners aiming to support family businesses in adapting to contemporary challenges. Additionally, it underscores the need for context-specific and relational approaches in developing effective strategies for organizational innovation in similar settings.