Is Material Management Required In Management Silver Craft SMEs? (Case Study in Gianyar Regency of Bali Province. Indonesia)


The craft industry is growing rapidly in Bali as a support for the tourism sector, moreover Bali is a world tourist destination. One of them is silver craft, which has now developed as a fashion value product. To create a competitive product, which has quality, quality and uniqueness, of course management material (in this case silver as raw material) needs to be considered. The purpose of this study is to analyze the influence of innovation and competitive advantage on business performance, as well as the role of material management on the influence of competitive advantage on the business performance of silver craft SMEs in the Province of Bali. The population in the study was silver craft SMEs in Gianyar Regency, which is the center of the silver industry in Indonesia. The sample size is determined by the formula Isaac and Michael, so that a sample of 146 respondents was obtained. Data was collected through questionnaires and independent interviews. Furthermore, the data were analyzed using the SEM-PLS approach. The results of data analysis show that competitive advantage has a positive and significant effect on business performance, while material management directly or as a moderator turns out to have no significant effect on business performance. It is recommended that silver craftsmen do material management in a simple but careful manner, and focus more on forming product competitiveness.

[1] A. F. Al-Sa’di, A. B. Abdallah, and S. E. Dahiyat, “The Mediating Role of Product and Process Innovations on The Relationship Between Knowledge Management and Operational Performance in Manufacturing Companies in Jordan”, Business Process Management Journal, vol. 23, iss 2, 2017.
[2] A. Oztekin, D. Delen, H. Zaim, A. Turkyilmaz, and S. Zaim, “The Influence of Knowledge Management on Financial and Non-Financial Performance,” Journal of Information & Knowledge Management, Vol. 14, No. 2, 2015.
[3] B. Alfadda, “Institutional Renewal And Adaptation (IRA): Creating And Managing Sustainable Competitive Advantage (SCA),” Thesis, University of Maryland University College, USA, 2010.
[4] B. Dreyer, and K. Gronhaug, “Uncertainty, Flexibility, and Sustained Competitive Advantage,” Journal of Business Research, vol. 57, pp 484–494, 2004.
[5] B. D. Sarkindaji, N. A. Bin Hashim, and A. O. Abdullateef, 2014. Knowledge Management and Organizational Performance of Mobile Service Firms in Nigeria: A Proposed Framework. Information and Knowledge Management, Vol.4, No.11, 2014.
[6] C. Bagaka and M. Moronge, “Role of Material Management on Performance of Sugar Manufacturing Industries in Kenya Case of Mumias Sugar Company Limited”, The Strategic Journal of Business & Change Management, vol. 4, iss. 1 (12), pp 227 – 245, 2017.
[7] C. Valmohammadi and M. Ahmadi, “The Impact of Knowledge Management Practices on Organizational Performance A Balanced Scorecard Approach,” Journal of Enterprise Information Management, vol. 28, no. 1, 2015 pp. 131-159, 2015.
[8] Central Bureau of Statistics of Bali Province, Bali in Figure 2014, Denpasar: Central Bureau of Statistics of Bali Province, 2014.
[9] D. P. Koumanakos, “The Effect of Inventory Management on Firm Performance,” International Journal of Productivity and Performance Management, vol. 57, iss 5, pp. 355-369, 2008,
[10] E. Byukusenge, J., Munene, and L. Orobia, “Knowledge Management and Business Performance: Mediating Effect of Innovation,” Journal of Business and Management Sciences, vol. 4, no. 4, 82-92, 2016.
[11] E. F. Kipesha, “Performance of Microfinance Institutions in Tanzania: Integrating Financial and Non financial Metric,” European Journal of Business and Management, vol. 5, no. 4, 2013.
[12] G. Corina, I. Liviu, and S. Roxana, “Determinants of Organizational Performance: the Case of Romania,” Journal Management & Marketing Challenges for the Knowledge Society, vol. 6, no 2, pp 285-300, 2011.
[13] G. O. Ondiek, O. Odera, and M. Muliro, “Assessment of Materials Management in Kenyan Manufacturing Firms,” Journal of Business Studies Quarterly, vol. 3, no. 3, pp. 40-49, 2012.
[14] J. A. I. Younis, Y. Nor’Aini, and N. Davoud, “A Review Paper on Organizational Culture and Organizational Performance,” International Journal of Business and Social Science, vol. 1, no. 3, 2010.
[15] L. A. Y. Al-Hakim and S. Hassan, “Knowledge Management Strategies, Innovation, and Organisational Performance An Empirical Study of The Iraqi MTS,” Journal of Advances in Management Research, vol. 10, no. 1, pp. 58-71, 2013.
[16] L. Alrubaiee, H. M. Alzubi, R. Hanandeh, and R. A. All, “Investigating the Relationship Between Knowledge Management Processes and Organizational Performance The Mediating Effect of Organizational Innovation”, International Review of Management and Business Research, vol. 4 issue.4 pp 989-1009, 2015.
[17] M. E. Porter, Competitive Advantage: Creating and Sustaining Superior Performance, New York: New York Press, 1985.
[18] ____________, “The Competitive Advantage of Nations,” Harvard Business Review, March-April 1990 Issue, 1990.
[19] M. Migdadi, M. K. A. Zaid, M. Yousif, R. Almestarihi, and K. Al-Hyari, “An Empirical Examination of Knowledge Management Processes and Market Orientation, Innovation Capability, and Organizational Performance: Insights from Jordan,” Journal of Information & Knowledge Management,” vol. 16, no. 1, 2017.
[20] M. N. Yusof and A. H. Abu-Bakar, “Knowledge Management and Growth Performance in Construction Companies: A Framework,” Procedia Social and Behavioral Sciences, vol. 62, pp. 128-134, 2012.
[21] M. R. Kuhl, J. C. da Cunha, M. B. Macaneiro, and S. K. Cunha, “Relationship Between Innovation and Sustainable Performance,” International Journal of Innovation Management, vol. 20, no. 3, 2016.
[22] Meutia and T. Ismail, “The Development of Entrepreneurial Social Competence And Business Network to Improve Competitive Advantage And Business Performance of Small Medium Sized Enterprises: A Case Study of Batik Industry In Indonesia,” Procedia - Social and Behavioral Sciences, vol. 65, pp 46 – 51, 2012.
[23] N. A. A. Rahman, and A. Ramli, “Entrepreneurship Management, Competitive Advantage and Firm Performances in the Craft Industry: Concepts and Framework,” Procedia - Social and Behavioral Sciences, 145, 129–137, 2014.
[24] P. J. Keitany, D. M. Wanyoike, and S. Richu, “Assessment Of The Role of Materials Management on Organizational Performance A Case of New Kenya Cooperative Creameries Limited Sciences,” European Journal of Material Sciences, vol. 1, no. 1, pp. 1-10, 2014.
[25] P. Kumarawadu, “Achieving Competitive Advantage through Knowledge Management Initiatives in Small and Medium Software Industry,” Journal of Information & Knowledge Management, vol. 7, no. 4 pp. 255–265, 2008.
[26] P. T. Ward, J. K. McCreery, L. P. Ritzman, and D. Sharma, “Competitive Priorities in Operations Management,” Decision Sciences, vol. 29 (4), pp. 1035-1046, 1998.
[27] S. Kamboj, and Z. Rahman, “Market Orientation, Marketing Capabilities and Sustainable Innovation: The Mediating Role of Sustainable Consumption and Competitive Advantage,” Management Research Review, vol. 40, issue: 6, 2015.
[28] S. M. Tseng and P. S. Lee, “The Effect of Knowledge Management Capability and Dynamic Capability on Organizational Performance,” Journal of Enterprise Information Management, vol. 27, no. 2, pp. 158-179, 2014.
[29] S. T. Ha, M. C. Lo, and Y. C. Wang, “Relationship between Knowledge Management and Organizational Performance: A Test on SMEs in Malaysia,” Procedia - Social and Behavioral Sciences, 224, pp. 184 – 189, 2015.
[30] V. W. Naliaka dan G. S. Namusonge, “Role of Inventory Management on Competitive Advantage among Manufacturing Firms in Kenya: A
Case Study of Unga Group Limited,” International Journal of Academic Research in Business and Social Sciences, vol. 5, no. 5, 2015.
[31] W. Kuncoro and W. O. Suriani. (2017). Achieving Sustainable Competitive Advantage Through Product Innovation and Market Driving. Asia Pacific Management Review. [Online]. Available:
[32] Y. Kathawala and H. H. Nauo, “Integrated Materials Management: A Conceptual Approach,” IJDP & MM, vol. 19, no. 8, 2007.
[33] Z. Wang, and N. Wang, “Knowledge Sharing, Innovation and Firm Performance,” Expert Systems with Applications, vol. 39, no. 1, pp. 8899–8908, 2012.


Download data is not yet available.

How to Cite

Wijaya, P. Y., Rahyuda, I. K., Yasa, N. N. K., & ukaatmadja, I. P. G. (2019). Is Material Management Required In Management Silver Craft SMEs? (Case Study in Gianyar Regency of Bali Province. Indonesia). European Journal of Business and Management Research, 4(1).

Search Panel

 Putu Yudy Wijaya
 Google Scholar |   EJBMR Journal

 I Ketut Rahyuda
 Google Scholar |   EJBMR Journal

 Ni Nyoman Kerti Yasa
 Google Scholar |   EJBMR Journal

 I Putu Gde ukaatmadja
 Google Scholar |   EJBMR Journal