THE NAHDLIYAH SPIRITUAL VALUE PERSPECTIVE IN ANALYZING THE ROLE OF FINANCIAL PERFORMANCE OF MSME

(1)

VOLUME 21 ISSUE 3 SEPTEMBER 2023 JURNAL APLIKASI MANAJEMEN

622

JAM

J u r n a l A p l i k a s i M a n a j e m e n J o u r n a l o f A p p l i e d M a n a g e m e n t

V o l u m e 2 1 I s s u e 3 S e p t e m b e r 2 0 2 3

2 1 | 3 | 2 0 2 3

R e c e i v e d J u n e ‘ 2 3

R e v i s e d J u l y ‘ 2 3

A u g u s t ‘ 2 3 A c c e p t e d A u g u s t ‘ 2 3

THE NAHDLIYAH SPIRITUAL VALUE PERSPECTIVE IN ANALYZING THE ROLE OF

FINANCIAL PERFORMANCE OF MSME

Bedjo Santoso Hendar Zaenudin

Department of Management, Faculty of Economics, Universitas Islam Sultan Agung, Indonesia

Razali Bin Haron

Institute of Islamic Banking and Finance, International Islamic University, Malaysia

Abstract: The most researches related to the Nahdlatul Ulama (NU) community business performance is just focus on the role of entrepreneur, ICT, e- commerce, marketing, and other common variables that have ignored the important concept which initiated from the main value of the NU’s movement philosophy. It is therefore, this study aimed to analyses the role of Nahdliyah spiritual value (NSV) to NU’s busines performance. NSV considered as new concept synthesized by combining resource advantage on competition theory (RACT) and social identity theory (SIT) inserted by Nahdliyin value concept.

The object of this research is the NU business community members of the NU Entrepreneurs Association (HPN). This study used a quantitative method with purposive sampling to select 350 MSMEs (UMKM) under HPN in Central Java and tested the regressive relationship of 6 variables with SEM PLS 4.0.

The findings show that digital marketing capabilities, ICT, and entrepreneurial spirit are the factors that most support the existence of NSV. Besides that, NSV plays a role in mediating the relationship between these three factors to financial performance in an MSME. This study fulfils the theoretical gaps and produces new perspectives into the spiritual value concept of resource advantage theoryonthecompetitionbyinsertingspiritualvaluesimplementedinMSMEs based on spiritual community businesses. This research contributes to the development of a new concept of NSV. The study also covered the research gap related to the relationship between the variables involved.

Keywords: Nahdliyah Spiritual Value, Financial Performance, MSMEs, Busi- ness Community

CITATION

Santoso, B., Hendar, Zaenudin, and Haron, R. B. 2023. The Nahdliyah Spiritual Value Perspective in Analyzing the Role of Financial Performance of MSME. Jurnal Aplikasi Manajemen, Volume 21, Issue 3, Pages 622-641. Malang: Universitas Brawijaya. DOI: http://dx.doi.org/10.21776/ub.jam.

2023.021.03.06.

I N D E X E D I N

D O A J - D i r e c t o r y o f O p e n A c c e s s J o u r n a l s

S I N T A - S c i e n c e a n d T e c h n o l o g y I n d e x

D i m e n s i o n s G o o g l e S c h o l a r R e s e a c h G a t e G a r u d a

I P I - I n d o n e s i a n P u b l i c a t i o n I n d e x

I n d o n e s i a n O N E S e a r c h

C O R R E S P O ND I N G A U T H O R

B e d j o S a n t o s o

D e p a r t m e n t o f M a n a g e m e n t , F a c u l t y o f E c o n o m i c s ,

U n i v e r s i t a s I s l a m S u l t a n A g u n g , I n d o n e s i a

E M A I L

B e d j o . s @ u n i s s u l a . a c . i d

OPEN ACCESS

e I S S N 2 3 0 2 - 6 3 3 2 p I S S N 1 6 9 3 - 5 2 4 1

(2)

WWW.JURNALJAM.UB.AC.ID

623 INTRODUCTION

Research on the Nahdlatul Ulama (NU) Community is crucial because NU, founded on Ja- nuary 31, 1926, was a movement for the rise of Islamic Scholars, especially Nahdlatul Ulama (NU). NU is one of the largest Islamic organizations in Indonesia, engaged in religious, social, economic, and educational fields. In 2021, it is the largest Islamic organization in the world, with 60 mi- llion members and assets of 30,400 Islamic Board- ing schools. They have a vision and mission to build businesses toward an independent economy ba- sedonNahdlatutTujjar(theMovementofTraders) to advance the organization (Maulida and Santoso, 2022). The Gusjigang (Good, Islamic Knowledge, and Business) spirit is to be re-implemented among Nahdliyin Entrepreneurs to increase the prosperity of NU members (Tri Cahya et al., 2021).

However, the big potential is described above but is not yet significant for economic and business power. Hence, a detailed study is needed by involving some important variables.

A new paradigm will be established to deal with the above problem, so a new concept called NSV (Nahdliyah Spiritual Value) is offered to strengthen NU's business performance. NSV utilizes resource advantage and social identity approaches to analyze the relationship between religion and performance. Social identity theory suggests that followersofaspecificreligion,likeMuslims,identify with positive community values, leading to the superior performance (Harwood, 2020; Malhotra, 2021; Topaloglu et al., 2018; Varadarajan, 2023;

Zenniar, 2023). Competitive advantage, focusing on financial efficiency, product, service, price, de- livery, and image, can improve financial performance, including profit growth, return investments,

assetgrowth,profitmargingrowth,capitalgrowth, and marketing performance (Jones et al., 2018;

Dela Cruz et al., 2023; Quaye and Mensah, 2019).

However, resource advantage theory has faced criticism for neglecting the impact of technology and spiritual value (Bauman et al., 2018; Patel et al., 2019). Situmorang and Indriani (2023) emphasize the importance of incorporating spiritual value in- to competitive advantage theory, strengthening social identity theory, and incorporating religious culture in improving financial performance. Incre- ased financial performance greatly influences the implementation of Small and Medium Enterprises (Gyamera et al., 2023; Hai et al., 2023). Spiritual values are considered a unique resource superior to the intellectual capital in the business competition (Hendar et al., 2018; Sudarti and Fachrunnisa, 2023). The Religion-centered financial performance improvement strategies can be built through specific spiritual values, such as Nahdliyah Values (NV), derived from the philosophy of the Gusji- gang from Sunan Kudus (1450M) (Tri Cahya et al., 2021). The development of NSV as the new concept will be elaborated in the literature review section.

As described above, the business phenome- non (gap) in the research is a gap between the NU members' potential as the world's largest community and their economic and business power. One of the reasons is not yet utilizing knowledge to create superior intangible assets, such as ICT, e-commerce, and digital marketing, according to KH.

Ma'ruf Amin (Indonesian vice president) need some efforts to develop HPN with several capabilities covered by Nahdliyah values (Huda, 2021). In addition, HPN MSMEs have immense potential but lack business power.

Table 1. NU Entrepreneurs Association MSMEs in Central-Jawa

No SMMEs in Central Java (2021) HPN MSMEs

Category Unit Sales Turnover (Trillion IDR) (Unit)

1 Micro 3.776.843 90.48% 68,387 1.888.422

2 Small 354.884 8.50% 68,387 177.442

3 Medium 39.125 0.94% 68,387 19.563

4 Big 3.358 0.08% 68,387 1.679

Total 4.174.210 100% 2.087.105

Sources: Sulistya, (2022), Susanto (2021), Triono (2022)

(3)

VOLUME 21 ISSUE 3 SEPTEMBER 2023

SANTOSO ET AL. (2023) JURNAL APLIKASI MANAJEMEN

624

Table 1 illustrates around 50% (from total MSMEs) of HPN - MSMEs in Central Java which have not been managed properly (Triono, 2022).

Therefore, this research introduces Nahdliyah value and is expected to revive the NU business pio- neered by the founding fathersbyintroducing the GusjigangandNahdlatut-Tujjar (Tri Cahya et al., 2021). The NSV concept will be constructed with the entrepreneurial capabilities, digital marketing knowledge, and e-commerce (ICT).

Research on the relationship between the use of ICT and E-Commerce on the financial performance on the community business shows a positive and significant relationship (Hasan, 2021);

(Lestari et al., 2021); (Wirdiyanti, 2019), financial performance (Kulathunga et al., 2020); (Weweng- kang et al., 2021); (Utami et al., 2021) and marketing performance (Sanistasya et al., 2019); (Uwah et al., 2022). Meanwhile, Maulida and Santoso's (2022) research showed insignificant results. The result indicated a research gap between ICT and financial performance with MSMEs' research ob- jects. While research on Digital Marketing, ICT, and Entrepreneur on Financial Performance (FP), the results are still inconsistent, according to Ives and Kidwell, 2019; Nayak et al., 2023; Sukaatma- dja et al., 2021. The results show significance. Me- anwhile, other studies show no significant relationship (Varadarajan, 2023; Wongsansukcharoen andThaweepaiboonwong,2023).Thesestudiesal- so contain research gaps; therefore, the NSV concept is derived from two theories: competitive advantage resources, social identity theory, and spirituality. Besides that, the antecedent variables in- cludedinthisresearchareICTcapabilities(ICTC), digital marketing capability (DMC), and entrepreneurial capabilities (EC).

Based on the above description, it can be concluded that there is still a research gap, namely the inconsistency of relationship between DMC, ICTC, and EC variables on financial performance (FP). These variables are implemented in HPN, which is not an economic power. Therefore, a new concept (variable) was developed, namely NSV, to be expected to fulfill the theoretical gaps inserted from the spiritual value concept of RACT and SIT implemented in the HPN MSMEs. This study investigates antecedent variables (DMC, ICTC, EC) to FP and NSV. Besides that, to analyze the role of the Nahdliyah spiritual values (NSV) in the

MSMEs' business performance (HPN) as well as the role of marketing performance (MP) to strengthen financial performance.

LITERATURE REVIEW

This section will discuss developing a new concept as a novelty (NSV) and developing a hypothesis. Developing the new concept through the synthesizing process includes a discussion of the theory used, namely the theory of RACT (Resour- ce Advantage on Competition Theory) and SIT (Social Identity Theory). The discussion includes a brief description of the strengths and weaknesses of the theory. SIT is used to find a basis for developing management theory from an angel view theory social perspective to incorporate religious-spi- ritualvaluessothatnewconceptsandvariablesare obtained,whichwillbediscussed.Then,aresearch hypothesis will be compiled.

Resource Advantage on Competition Theory (RACT) and Social Identity Theory (SIT)

Resource Advantage on Competition theory is an evolutionary process theory focusing on generating positional advantages in various market segments to achieve superior company performance (Varadarajan, 2023). This strategy involves using resources (tangible, intangible, and human) to increase organizational capability and strengthen market position and product excellence (Rua et al., 2018; Sukaatmadja et al., 2021). Competitive advantage can be achieved through various factors, includingknowledge,entrepreneurship,marketin- formation, capital, networking, and organizational structure(LiuandYang,2019).Acompany'scom- parative resource advantage leads to superior competitive advantage in market segmentation and financial performance (Malhotra, 2021).

The uniqueness of resources comes from in- nerknowledge,andResourceBasedTheory(RBT) suggeststhatacompanycanwinincompetitionby generating, controlling, and utilizing strategic assets in the form of superior resources (Nayak et al., 2023; Wongsansukcharoen and Thaweepaiboon- wong, 2023). Maintaining high levels of intellectual capital and utilizing company assets can lead to a sustainable competitive advantage (Kiyabo and Isaga, 2020). However, this theory does not explain how to obtain unique resources from inner motivation, an intangible asset. Overall, resource

(4)

625 advantage competitive theory provides valuable

insights into generating positional advantages, en- hancingorganizationalcapabilities,andenhancing financial performance (Estensoro et al., 2022; Liu and Yang, 2019).

The RAC theory has faced criticism for its focus on market segment competition and companies fighting over specific markets. Varadarajan (2023) argued that the competition should consider consumer factors like quality products and low prices. According to Zenniar (2023), the theory neglects inner factors such as spiritual values, making it a dubious thesis critique. Hunt and Morgan also need to explain superior performance in the market and finance. The RACT theory's primary criticism is its neglect of spiritual values contrib- uting to superiority (Howard et al., 2022; Paruzel et al., 2020).

Materialism is criticized for overlooking religious, spiritual, local, and cultural values in development, cooperation, mutual help, and brotherhood; it is criticized for neglecting these aspects in thethird-worldimplementationandsmallbusiness (Zenniar, 2023). Instead, Nahdliyah values, adopt- ed by Sunan Kudus, are prioritized, focusing on the Gusjigang philosophy (Tri Cahya et al., 2021).

Social identity theory (SIT) is a framework for understanding intergroup behavior and communication, focusing on inherent values and positive vi- ews of specific social groups (Fujita et al., 2018;

Scheepers and Ellemers, 2016). It emphasizes the role of ethnocentrism and religion in shaping individual and community identities. SIT suggests that the religious understanding influences individuals' identification with Muslim groups in the economic transactions. In other words, as an organization member, the individual tries to identify the group community social values as esteem identity to lead to better group organization performance (Seering et al., 2018; Tri Cahya et al., 2021). Hence, SIT, in line with RACT in terms of competitive advantage for developing the unique resource/ value as special characteristics, can lead to higher performance. Meanwhile, spirituality, derived from Nahd- latul Ulama values, serves as a role model for Nah- dliyin, whether individual or group, in social life, religion, and the business economy.

Nahdliyah Value

The study analyzes NU members' business

performance, focusing on marketing and financial aspects. Besides that, it also studies the role of Na- hdliyah values (NSV) derived from founding fa- thers, such as Hasyim Asy'ari; meanwhile, Com- bining competitive advantage and social identity theories, the study creates a new concept called NSV, focusing on the spiritual value of mass organizations like NU, the most prominent Islamic organization in Indonesia.

Researchers suggest that superior performance improvement strategies can be achieved through religiosity-based approaches, as religion/beli- ef is the inner spirit that encourages superior activities in all aspects of human life. Spiritual values are unique resources from inner knowledge and mobilize superior resources (De Pater et al., 2023).

According to Resource Based Theory (RBT), a company wins in competition by generating, controlling, and utilizing strategic assets to improve firm performance (Varadarajan, 2023; Zhao and Fan, 2018). Maintaining superior resources, such as intellectual capital, can increase a company's effectiveness, efficiency, and productivity; implementing NSV in Nahdliyin residents' entrepreneurial spirit can strengthen their businesses and improve theirfinancialperformance.Thispositionaladvan- tage can also improve marketing and financial performance, as it is triggered by digital marketing capability, ICT capability, and entrepreneur capability.

The Role of Spiritual Value in Competitive Ad- vantages

Religionhasbeenusedasabasisforcompe- titive business strategy, focusing on superior unique resources such as religio-centric, knowledge of knowledge, spiritual welfare, and Islamic intrinsic motivation (Ives and Kidwell, 2019). Spiritual value is an inner power based on one's religious identity, which can improve the business performance.

Research shows that the religious beliefs influence corporate decision-making, corporate culture development, and the business judgment (Kurt et al., 2020). Stronger individuals' religions are more likely to comply with religious doctrines and ethical codes (Fesharaki, 2019). Spiritual values are intangible assets that can be developed into tangible and intangible strategic assets to improve firm performance.Thespiritualityreflectshumanphysical, mental, moral, and spiritual maturity, reflecting

(5)

626

human nature as a socio-cultural being (Tri Cahya et al., 2021; Zenniar, 2023). Nahdliyah's spiritual values are derived from the spiritual concept of the Nahdlatul Ulama (NU) congregation, namely Ma- badi Khaira Ummah (MKU) (Fauzi, 2019). Based on the fundamental principles of worship, justice, honesty, and faithfulness to build the best genera- tionareconsideredstrategicassetsthatcanbeused to improve business performance.

Maintaining superior intellectual capital capabilities and utilizing company assets effectively and efficiently can lead to a sustainable competitive advantage (Leong et al., 2023). Spiritual value can be managed and utilized to increase the company's effectiveness and efficiency, increasing employee productivity and company performance, including financial performance (Jahanbakhsh-Ja- vid and Amini, 2023; Zhang et al., 2023). Religion serves as a screening tool for financial literacy, directly affecting business performance (Prakoso et al., 2023).

Religion plays a crucial role in the business strategy, providing unique resources such as religio-centric, wisdom of knowledge, spiritual welfare, and Islamic intrinsic motivation (Cahyono et al., 2023). These values can improve business performance by influencing corporate decision-making, culture development, and business judgment.

Stronger individuals' religions are more likely to comply with religious doctrines and ethical codes (Jahanbakhsh-Javid and Amini, 2023). The spiritual values are derived from the Nahdliyah spiritual concept(Prakosoetal.,2023).MabadiKhairaUm- mah can be developed into strategic assets that enhance firm performance. These principles, such as ash-shidqu, al amanah wal-wafa bil 'ahdi, and at- ta'awun, can be categorized as strategic assets that can be utilized to improve business performance (Fauzi, 2019). Maintaining superior intellectual capital capabilities and using company assets can create a sustainable competitive advantage. Spiri- tual value can be managed and utilized to increase company effectiveness, efficiency, employee productivity, and financial performance, directly affecting business performance (Leong et al., 2023).

To strengthen resource advantage, adding a spiritual/religiousdimensionandstrengtheningthe

social approach using social identity theory (Sche- epers and Ellemers, 2016). Social identity theory explains intergroup behavior and communication based on humans' inherent value of social group membershipsandtheirdesiretoviewtheirspecific social groups positively (Paruzel et al., 2020; Sch- eepers and Ellemers, 2016). A high Islamic work ethic is characterized by individuals and organizations striving for better performance in all fields.

This work ethic is divided into three points: (1) a mandate from God for mutual prosperity, developing brotherhood, collaborating, building integrity, and building on gratitude. (2) Empowering and de- voting effort through hard work, (3) dedication to God for fellow humanity and work and worship sincerely (Hendar et al., 2017a, 2018b).

Religious individuals are more likely to be sources of inspiration, develop an entrepreneurial spirit, stay updated on the technological develop- ments,andbeinnovative,whichcantriggerenhan- ced spiritual values (Hendar et al., 2017a). These factors cause individuals to consider unique strategic resources as capital in business competition.

Religion serves as a screening tool for financial literacy, directly affecting business performance.

Hence, NSV can be utilized by Nahdliyin members for improved business performance driven by entrepreneurial values, innovation, and ICT capabilities (Hendar et al., 2018b).

Synthesizing Process

The RACT theory suggests that companies must generate valuable, unique, inimitable, rare, and exploitable resources to win competition and achieve superior financial performance. However, this theory has areas for improvement, such as not explaining the role of inner knowledge from intangible assets. RAC theory focuses on the two advantages, i.e., capital, entrepreneur, market, knowledge, network, products, services, reputation, and economics. Therefore, this study aims to incorporate spiritual values from the largest community in the world, the SMEs NU community. Nahdlatul Ulama, a spiritual/religious organization, has a philosophy of struggle called Gusjigang and Nahdla- tut-Tujjar, which can be revived as Nahdliyah values.

(6)

627 Source: Hendar et al. (2017b, 2018b), Ives and Kidwell (2019), Nayak et al. (2023), Sukaatmadja et al. (2021), Tri Cahya et al. (2021), Varadarajan (2023), Wongsansukcharoen and Thaweepaiboonwong (2023)

Figure 1. Theoretical Models

A new concept, NSV, was developed by synthesizing Nahdliyah values and incorporating them as inner knowledge to generate unique and valuableresourcesforthebusinesscompetitivead- vantage among SMEs. NSV is expected to directly improve the financial performance (FP) or through marketing performance (MP). In the competitive era of the Digital Collaborative Network (DCN), NSV is driven by capabilities such as digital marketing capability (DMC), ICT capability (ICTC), and entrepreneur capability (EC). Hence, this research produces six variables: DMC, ICTC, EC, NSV, MP, and FP, with NSV and MP mediating variables. The synthesizing process described above in the theoretical model can be seen in Figure 1.

HYPOTHESIS DEVELOPMENT

Dynamic digital marketing (DMC) combines marketing and digital configuration, focusing on stakeholder networking, customers, suppliers, and logistics. It enhances the online marketing, e- commerce, and global market access, increasing global companies' capabilities and market growth (Gregory et al., 2019). DMC improves global business performance, manages international explo- ration and exploitation processes, and influences sustainable financial performance. Integrating in- ternet, digital, and marketing elements strengthens market orientation, ultimately improving financial performance (Ives and Kidwell, 2019; Abrokwah- Larbi and Awuku-Larbi, 2023). DMC helps com-

Knowledge

Resource Advantage Theory

Comparative Advantage

Organizational Culture

Entrepreneur Market information

Capital Networking

Competitive Advantage

Product

Service Power of networking

Reputation/image Economics Religiocentrict

Spiritual

Social Identity Theory

Religion Group

Nahdlatul Ulama

Muhammadiyah NAHDLIYAH

VALUE Nahdliyah Spiritual Value

Digital Marketing Capabiliities

ICT Capabilities

Entrepreneur Capability

(7)

628

panies manage relationships with suppliers, customers, and channel members, promoting innovation and sustainable financial performance (Alarcón -del-Amo et al., 2018).

Cooperative governance between the prod- ucers, suppliers, and buyers enhances innovation;

IT is essential for efficient business operations and for supporting core competencies (Hendar et al., 2018b). Successful adoption and implementation are crucial for business success, with companies investing in sophisticated systems that simultane- ously increase productivity, reduce costs, and improve services (Fesharaki, 2019). ICT capabilities can improve the financial performance, providing a competitive advantage and enhancing efficiency, effectiveness, and flexibility. That leads to increased service quality, reduced costs, and increased income (Topaloglu et al., 2018).

Entrepreneur Capability (EC) identifies opportunities,alignsresources,andconvertsthemin- to real-benefit economic values. It is a crucial dri- ver of firm performance, driven by entrepreneurial orientation, innovation, risk-taking, and proactive opportunity-seeking (Varadarajan, 2023). The EC comprises three dimensions: innovativeness, pro- activeness, and taking risks. Innovativeness involves turning ideas into reality, pro-activeness ad- dressesexternalconstraints,andtakingrisksinvol- ves identifying, assessing, and achieving business goals (Liu and Yang, 2019).

EC positively impacts financial performance, with the Innovation Dimension driving growth and enhancing the Proactive dimension. Proactive behavior includes seeking opportunities, anticipating demand and identifying gaps, building a customer-based business reputation, encouraging customer purchases, and increasing sales turnover.

The EC is essential for long-term sustainability in today's competitive business environment, as entrepreneurs face uncertain risk environments and complex decision-making (Malhotra, 2021). To answer the questions in the research, the hypothesis in this study is to test the correlation of every aspect of comparative advantage.

H1 : Dynamic digital marketing has a significant correlation to firm performance.

H2 : ICT capability has a significant correlation to firm performance

H3 : Entrepreneur Capability has a significant correlation to firm performance

An industrial organization's competitive advantage is influenced by the external environmen- tal conditions and the internal resources, such as long-term performance, characteristics, and strategic choices (Jahanbakhsh-Javid and Amini, 2023).

Digital marketing (DM) is a cost-effective, scala- ble, and interactive technique that combines ICT and knowledge marketing, improving relationships with global consumers and enabling businesses to survive in the era of globalization (Scheepers and Ellemers, 2016; Zhang et al., 2023).

Digital marketing capability (DMC) combines ICT and marketing knowledge to benefit businesses by managing and coordinating digital relationships with suppliers, customers, and logistics, enhancing process integration and resulting in better company performance (Tri Cahya et al., 2021;

Santoso et al., 2022). DMC positively impacts the marketing by improving understanding of current andfutureconditionsandmarketsegments(Nayak et al., 2023). A good DMC facilitates the implementation of unique marketing strategies and em- bodies the Nahdliyah Spiritual Value (NSV), derived from the Nahdliyah's spirit and khaira ummah principles. Implementing NSV in Nahdlatul Ula- ma residents' business spirit strengthens the organization's competitive advantage and creates superior resources based on knowledge and specific values.

ICT Capability uses ICT tools to gain competitive advantage, integrate training, and produce ICT-learning skill sets for the SMEs (Malangen, 2022). It involves effectively utilizing IT resources, promoting learning benefits, community development, and basic human development. Compa- nies with ICT competence can implement Know- ledge Management activities, creating, sharing, and applying knowledge to gain business opportunities (Wongsansukcharoen and Thaweepaiboon- wong, 2023). Competitive advantage is crucial in today's competitive business landscape, requiring innovation, networking, and anticipating consumer needs (Kiyabo and Isaga, 2020). Reliable information technology is essential for strategic business decisions and customer service (Utami et al., 2021).

Spiritual values like Nahdliyah (NV) are superior to competitive advantages. Developing reflective practices like prayer, contemplation, or meditation can improve motivation, productivity,

(8)

629 performance,resilience,andagility(LiuandYang,

2019). Entrepreneurship is a dynamic mindset that anticipates business changes and involves proactive values like innovation, creativity, and growth (Ives and Kidwell, 2019). A strong entrepreneurial culture drives industry winners (Scheepers and El- lemers, 2016; Paruzel et al., 2020), making EC essential for the Nahdliyah community. By increasing the entrepreneurial capability, businesses can achieve their goals and vision, impacting business performance (Isichei et al., 2020). To answer the questions in the research, the hypothesis in this study is to test the correlation of every aspect of Nahdliyah's spiritual values.

H4 : Dynamic digital marketing has a significant correlation to Nahdliyah's Spiritual Value.

H5 : ICT capability has a significant correlation to Nahdliyah's Spiritual Value.

H6 : Entrepreneur Capability has a significant correlation to Nahdliyah's Spiritual Value.

Firms with a competitive advantage can de- velopstrategiesthatutilizethe socialnetworking, market efficiency, and growth (Wang, 2020). This knowledge helps organizations organize data and improve marketing efforts. Expertise in consumers, competitors, and markets helps organizations understand customer needs, identify competitors, and understand the market (Gregory et al., 2019).

Digital marketing strategies enhance efficiency in marketing activities, such as service and support, market analysis, and e-commerce sales. Building strong relationships with the potential and current consumers can help businesses dominate the market (Alarcón-del-Amo et al., 2018).

Religious values can enhance the marketing success by positioning the firms based on spiritual principlesandstandards(Hendaretal.,2020).This strategy meets the customer needs, product design, and trends while adhering to religious principles, enabling competition for sales performance growth. This approach significantly impacts marketing performance (Maulida and Santoso, 2022).

Spirituality encompasses the human physic- al, mental, moral, and spiritual maturity, reflecting human nature as a socio-cultural creature. It includes the values like kindness, justice, truth, honesty, conscience, honor, patriotism, hard work, love of beauty, pleasure, hatred of evil, and perseveran-

ce (Tri Cahya et al., 2021; Zenniar, 2023). Nahdl- yah's spiritual values are derived from the Nahdla- tul Ulama congregation, Mabadi Khaira Ummah (MKU), which emphasizes principles in the socio- economic midwifery. In trading, these values are combined with Sunan Kudus' Gusjigang philosophy, emphasizing good behavior, good recitation of the Koran, and business skills (Tri Cahya et al., 2021). Trading is an entrepreneurial spirit that cre- atively and innovatively finds material sources of livelihood, creating a harmonious and prosperous world (Fesharaki, 2019).

Spiritualvaluesareessentialforacompany's success in resource-based theory (RBT), as they can be combined with tangible and intangible assets to achieve superior resource excellence and a sustainable competitiveadvantage(IvesandKid- well, 2019). Spirituality can also improve company and financial performance, with strategies centered on religion focusing on spiritual values like honesty, trustworthiness, responsibility, and help- ing each other (Kurt et al., 2020). The implementation strategy of Nahdlatul Ulama (NSV) in the Nahdliyin residents, known as Gusjigang, can increase the business and prosperity for NU members, triggering innovation, producing high-quality goods, and growing enthusiasm for the service, leading to higher sales and profitability (Tri Cahya et al., 2021).

Marketing performance is significantly influenced by a company's marketing strategy, which aims to achieve both marketing and financial success(Fesharaki,2019).Competitiveadvantagecan facilitate marketing performance and create productivity resources. Research shows a significant association between marketing strategy and financial performance (Wang, 2020). Marketing capability, such as social media, can improve perform- ancemanagementandfinancialperformanceinthe SMEs (Fahmi, 2020). To answer the questions in the research, the hypothesis in this study is to test the correlation of every aspect of financial performance.

H7 : Nahdliyah's Spiritual Value has a significant correlation to marketing performance.

H8 : Nahdliyah's Spiritual Value has a significant correlation to financial performance.

H9 : Marketing performance has a significant correlation to financial performance.

(9)

630

Figure 2. Hypothesis Model

Figure 3. Process Analysis

METHOD

Based on the explanation, this research also explores the role of NSV in mediating the relationship between digital marketing capability (DCM), technology capability (ICTC), and CT to FP. This study investigates the relationship between DMC, ICTC, EC, NSV, and FP. Besides that, to explore the effects of NSV on MP and FP. This research is also to investigate the role of the NSV in engaging the spirituality based to enhance the business NU community. This follows the conditions of the NU community, which has particular values to develop the business. This type of research is quantitative research, using secondary data (Wyllie, 2021).

To answer the research objectives through the stages: (1) Determining data sources based on population and research samples; (2) Determine measurement indicators based on variable formulations;

(3) Perform input data; (4) Perform data processing and analysis; (5) discussion and conclusions from the analysis results. The process stages are presented in Figure 3.

The type of this study is explanatory research using purposive, area, and stratified sampling methods involving 350 respondents from the NU community doing business in Indonesia. This study employed the quantitative structural equation modeling (SEM) using smart partial least square

H9 H7

H5

H6

H3 H1

H2

H4 Nahdliyah Spiritual Value (NSV) Digital

Marketing Capability

(DMC)

ICT Capability (ICTC)

Entrepreneurial Capability (EC)

Marketing Performance

(MP)

Financial Performance

(FP)

Discussion and Conclusion Data Source

*Secondary, Population:

NU Entrepreneurs

Association and Sample:

350 MSMES

Measurement of the Nahdliyah Spiritual Value Variable for Financial Performance

*digital marketing capability; ICT capability, entrepreneurial capability;

marketing performance;

Nahdliyah spiritual value, and financial performance

Input Data

Data Processing and Analysis

(10)

631 (Smart-PLS) version 3.3.2. According to Chakra-

borty et al. (2022), PLS is a potent cause analysis method based on only some assumptions or conditions,suchasnormalityandmulticollinearitytests.

This method has advantages: the data do not nec- essarily have multivariate normal distribution (Pr- ayitno et al., 2022).

The indicators with categorical, ordinal, and interval-to-ratio data scales can be used. Another advantage is that the sample size does not have to be significant. The PLS approach is distribution- free; therefore, PLS was appropriate for this research because the variable indicators were ordinal scales (Hair et al., 2017). The PLS can also analyze constructs formed with reflective and formative indicators (Jie Feng, 2018).

RESULTS

Model Measurement between Variables Measurement model evaluation consists of Cronbach alpha and Composite Reliability (CR) to evaluate internal consistency, indicator reliability, AVE for convergent validity evaluation, and For- nell Larcker and HTMT (Heterotrait Monotrait) to evaluate discriminant validity (Chakraborty et al., 2022). If the indicator reliability of each item's ou- ter loading is more than 0.5 to 0.7, the results of the measurement model assessment can be considered satisfactory (Wyllie, 2021). All of the variables in this analysis have an AVE value greater than 0.5 (see Table 2). The value of Cronbach's alpha from 0.40 to 0.60 is quite reliable; higher than 0.60 to 0.80 is reliable, and higher than 0.80 to 1.00 is very reliable.

Common method variance (CMV) bias is a crucial problem in questionnaire research (Tehse- en et al., 2017). The data collection from a single source or self-response tends to result in a degree of covariance among the questionnaire items. In order to test the presence or absence of CMV between variables, it is determined by most reliable approach, namely full collinearity evaluation using the SmartPLS (Jie Feng, 2018). If the VIF value of all indicators or variance is lower than 3.3, which means the model has no CMV problem, as shown in Table 2.

In addition, this research used a matrix of Fornell-Larcker and HTMT, as suggested, to test discriminant validity. Table 3 shows the Fornell-

Larcker matrix, AVE root square values (diago- nal) higher than all the values, and the HTMT value is more than 1 (Rasoolimanesh, 2022). There- fore, the discriminant validity of the measurement model was confirmed. The PLS model Algorithm results indicate that all variables' indicators are va- lid and reliable (Hilkenmeier et al., 2020), as dis- played in Table 3.

Furthermore, the coefficient of determinati- on is used to test the ability of a model to explain the variation in the dependent variable whose value is between zero and one. Tests on the structural model were carried out by looking at the R-Square value, which is a goodness-fit model test (Tehseen et al., 2017). If R-Square is 0.67 -1.00, the model is good (strong); 0.33 - 0.66 indicates moderate, and less than 0.33 indicates weak (Nazaina et al., 2023). The R2 value in this study showed moderate for the FP, MP, and NSV variables, as shown in Table 4. Table 4 shows it may be inferred that endogenous variables financial performance (FP), marketing performance (MP), and Nahdliyah Spi- ritual Value (NSV) have strong and moderate predictive power (0.751, 0.562, and 0.533, respectively). The Exogenous factors digital marketing capability (DMC), ICT capability (ICTC), and entrepreneur capability (EC) can be stated to predict (75%, 56.2 %, and 53.3%) the endogenous variables financial performance, marketing performance, and Nahdliyah Spiritual Values. In contrast, variables outside of this study impact the rest. Ex- ogenous NSV can likewise predict endogenous MP (56.2%) and FP (75.10%), with the remaining affected by the vari-ables outside of this study.

In the explanation before, it can be concluded that the endogenous variables of financial performance (FP), marketing performance (MP), and the Nahdliyah Spiritual Value (NSV) have solid and moderate predictive power (0.751, 0.562, and 0.533, respectively). Exogenous factors of digital marketing ability (DMC), ICT ability (ICTC), and entrepreneurial ability (EC) can be stated to predict (75%, 56.2%, and 53.3%) the endogenous variables of financial performance, marketing performance, and Value Spiritual Nahdliyah. In contrast, variables outside of this study influence the rest.

Exogenous NSV also predicted endogenous MP (56.2%) and FP (75.10%), with the remainder being influenced by variables outside this study.

(11)

632

Table 4. R Square Coefficient

Source: Output of SmartPLS 4

Table 5. Hypothesis Test

Table 6. Mediating Effect

Hypothesis/Path Path Coefficient Effect

IE TE VAF IE/TE

Mediation / Indirect Effect

H1:DMC àNSV àFP 0.033 1.000 Full Mediation

H2: ICTC àNSV àFP 0.012 1.156 Full Mediation

H3: EC àNSV àFP 0.083 1.156 Full Mediation

H8: NSV àMP àFP 0.003 0.561 Partial Mediation

Total Effect

DMC àFP 0.010

ICT C àFP 0.002

EC àFP 0.072

NSV àFP 0.033

R Square R Square Adjusted

FP 0.751 0.664

MP 0.562 0.559

NSV 0.533 0.541

Hypothesis/Path Path Coefficient (β) t-stat p-Values Hypothesis/

Results

H1: DMCFP 0.012 1.943 0.083 Significant at 10%

(Consider Supported)

H2: ICTCFP 0.048 0.886 0.138 Not Significant

H3: ECFP 0.003 2.266 0.049 Significant / Supported

H4: DMCNSV 0.345 2.237 0.026 Significant / Supported

H5: ICTCNSV 0.257 2.441 0.023 Significant / Supported

H6: ECNSV 0.345 2.434 0.002 Significant / Supported

H7: NSVMP 0.511 2.011 0.040 Significant / Supported

H8: NSVFP 0.241 2.213 0.035 Significant / Supported

H9: MPFP 0.025 2.011 0.040 Significant / Supported

*If VAF: < 0.2 = No Mediation; If VAF > 0.2 = Partial Mediation; If VAF > 0.8 = Full Mediation

(12)

633 DISCUSSION

Direct Effect DMC, ICTC, EC, NSV, and MP to FP

Table 5 shows that DMC to FP significantly affects a 10% error level. ICTC to FP is insignificant (β = 0.048, p-value =0.138), and EC to FP is significant. These results conclude that H1 and H2 are not supported even though H1 is supported at an error level of 10%. DMC has not maximized the effect on FP, the effect of ICTC on FP is insignificant, and the effect of EC on FP is significant.

ICTC and DMC among HPN MSMEs have been unable to provide maximum influence on financial performance. It means that DMC and ICTC among HPN SMEs are not a mainstay for improving financialperformance.Itturnsoutthattheresearch results are not in line with several previous studies regarding the effect of DMC, ICTC, and EC on FP, where DMC contributes to financial performance, and ICTC affects financial performance (Fe- sharaki, 2019; Alarcón-del-Amo et al., 2018; Hen- daretal.,2018a;Varadarajan,2023).Itcanhappen because most research focuses on the more com- prehensive/international business context, not the SMEs.

Furthermore, the coefficient of determinati- on is used to test the ability of a model to explain the variation in the dependent variable whose value is between zero and one. Tests on the structural model were carried out by looking at the R-Square value, which is a goodness-fit model test (Tehseen et al., 2017). If R-Square is 0.67 -1.00, the model is good (strong); 0.33 - 0.66 indicates moderate, and less than 0.33 indicates weak (Nazaina et al., 2023). The R2 value in this study showed moderate for the FP, MP, and NSV variables, as shown in Table 4.

Direct Effect DMC, ICTC, EC, NSV, and MP to FP

Table 5 shows that DMC to FP significantly affects a 10% error level. ICTC to FP is insignificant (β = 0.048, p-value =0.138), and EC to FP is significant. These results conclude that H1 and H2 are not supported even though H1 is supported at an error level of 10%; this means that DMC and ICTC among HPN SMEs have not been able to have a maximum effect on financial performance.

It turns out that the research results are not in line with several previous studies regarding the effect

of DMC, ICTC, and EC on financial performance, where DMC contributes to financial performance, and ICTC affects financial performance (Alarcón- del-Amo et al., 2018; Fesharaki, 2019; Hendar et al., 2018a; Varadarajan, 2023). It can happen because most research focuses on the more compre- hensive/international business context, not SMEs.

The results showed that Nahdliyah's Spir- itual Value has a significant correlation to financial performance, and Marketing performance has a significant correlation to financial performance, which means that NSV and MP can increase FP.

It confirms empirical support that NSV, which is a combination of Resource Advantage Competi- tive Theory, Social Identity Theory, and Religios- ity/Spirituality, can contribute to improving financial performance (Hendar et al., 2017b; Ives and Kidwell, 2019; Varadarajan, 2023; Nayak et al., 2023; Tri Cahya et al., 2021). However, NSV does not support the hypothesis, which means that Nah- dliyin (HPN) assumes that NSV has a competitive advantage; no, it lines up with MP strategy as in the internal community NU, some indicators and elements have already been appropriately implemented (Tri Cahya et al., 2021). The results of hypothesis testing (H9) are also supported. Market- ing capabilities, such as increasing the number of customers, market share, sales income, and sales volume, also contribute to achieving financial performance (FP) (Fahmi, 2020).

The Entrepreneurial and marketing capabilities include innovation, pro-activeness, and risk- taking. In contrast, digital capabilities like customer-linking, market-sensing, and channel bonding contribute to building a good culture, creating, and improving the new services and products (Liu and Yang, 2019). ICT and Digital capabilities also can improve efficiency, target fulfillment, and customer feedback, ultimately ensuring the cost-effective performance and increased financial resources (Zenniar, 2023). Hence, HPN should pay more at- tention to these issues to support their members to make much more effort in the future. The ICTC is not affected by FP, but there may be a lack of pri- ority for ICTC by community NU businesses, which need to be more responsive and responsive to ICT. Traditional practices characterize the association and need more interest in new technologies like digital e-commerce. However, ICTC is crucial and should be increased for success in the future.

(13)

634

NSV strategy can trigger deep NU awareness using ICT to increase efficiency and effectiveness in every activity, ultimately pushing cost-operational businesses (Hendar et al., 2018b).

Direct Effect DMC, ICTC, EC, to NSV and NSV to MP

Table 5 shows that the relationship direct effect between DMC, ICT, and EC on NSV is significant, and the hypothesis was supported. The results of hypothesis testing (H4, H5, and H6) are supported. It means that DMC, ICTC, and EC among Nahdhlatul Ulama Micro, Small, and Medium Enterprises (MSMEs) who are members of HPN can build NSV. Table 5 indicated that H7, the relationship between NSV and MP is not significant, which means that among the NU entrepreneurs (HPN), the values of NSV have not considered the vision of conventional marketing to be under NU values because HPN is already a congregation of collaboration that is strong enough under the Kiai (Islamic scholars). Besides that, this could be due to the variations in the NSV data not being suffici- ent to explain the variations in the data in the MP.

EC and DMC can help companies improve their ability to respond to changing techniques, service changes, customer needs, financial reengineering investments, and competitor strategies (Varadara- jan, 2023). These activities are supported by digital technology, enabling increased efficiency and strategic assets toward a superior business position. Research shows that EC and DMC directly im- pactFPandNSV,indicatingtheneedtostrengthen these dimensions further to support NSV and FP.

It aligns with previous studies (Alarcón-del-Amo et al., 2018; Gregory et al., 2019), indicating that MI is not a pusher but a direct influence on MP increase.

Mediating Effect

After obtaining direct effect results, determine the mediating effect position by testing two path mediations, NSV and MP, and determine the mediating the effect's position indirectly. Previous studies have indicated that VAF values range from

< 0.2 for no mediation to > 0.2 for partial mediation and > 0.8 for complete mediation. The VAF path mediation of DMC-NSV, ICTC-NSV, and EC-NSVtoFPwasmorethan0.8,supportingH1b, H2b, and H3b. NSV fully mediated the DMC-FP,

ICTC-FP, and EC-FP relationships, with partially mediated relationships. However, NSV-MP to FP is partially mediated as more significant than 0.2 (VAF). It aligns with previous research on the relationship between marketing performance, digital capability, and religiosity.

The finding of NSV as a new concept is also supported by the previous research on religiosity spirituality concept, e.g. (Cahya et al., 2021; Sa- thana et al., 2021; Tri Zenniar, 2023). Meanwhile, NSV's success mediated the relationship between DMC, ICTC, and EC on FP in line with research conducted (Hendar et al., 2020; Prakoso et al., 2023) on the relationship between NSV and financial inclusion. The effect of DMC, ICTC, EC, and MP on FP without involving a mediator NSV has a smaller coefficient of 0.088, compared to the effect of DMC, ICTC, EC, and MP after involving the NSV mediator is 0.133 (indirect effect); This suggests that NSV has a fully mediating role, and DMC, ICTC, and EC can increase FP if they go through NSV.

The research results reveal that internal factors like DMC, ICTC, and EC trigger NSV. To strengthen NSV, members of the HPN should enhance the digital capabilities, outgroup sustainable collaboration, networking, and channeling to sta- keholders. Additionally, NSV can be triggered by ICT Capabilities, such as using ICT tools for marketing and decision-making. HPN members must improvetheircapabilitiestotakeadvantageofITC toolstoenhancetheirdigitalcollaborativenetwork (DCN), which is key performance indicator (KPI) for business success in the era of disruption (Ives and Kidwell, 2019; Wang, 2020). This capability will increase the marketing capabilities of citizens.

HPN, in turn, will improve financial performance.

Table 6 shows NSV can mediate the influence of DMC, ICTC, and EC to FP, indicating that new spiritual values based on the Islamic community religion can facilitate variables latent to dependent variables. These values include customer- linking digital capabilities, market-sensing digital capabilities, channel-bonding digital capabilities, sustainable relationships with suppliers through digital platforms, innovativeness, proactive capability, risk-taking capability, ICT tools for marketing and market growth, information availability, strategic orientation, and ITC tools to enhance the original network (Gregory et al., 2019). Islamic

(14)

635 Nahdliyah values originating from Gusjigang and

Nahdlatuttujar include cooperation, help, working hard, obedience, struggle, and focus on happiness.

It can be facilitated through NSV (Tri Cahya et al., 2021). These values are oriented towards compre- hensive happiness and worship of God (ALLAH SWT).

NSV can enhance the performance finance by incorporating dimensionally good mark marks such as truth, no lie, trust, fulfillment of promises, commitment, and mutual help. It can strengthen relationships, strengthen the bonds of brotherhood, and build networks with faith-based business partners. Developing resources based on knowledge and capabilities and sharing information on religious values can increase performance and competitive advantage (Hendar et al., 2020). NSV facilitates connections between DMC, ICTC, and EC, triggering the prominent FP increase. Additio- nally, adding Islamic spiritual concepts to the draft strategy enhances competitive advantage in finance, adding repertoire knowledge about competitive resources implemented by a mass Islamic organization (Maulida and Santoso, 2022).

This research study highlights the weakness of the RACT theory viewed from the spiritual po- int of view, which overlooks spiritual values, im- material dimensions, and collective success (Vara- darajan, 2023; Topaloglu et al., 2018). The ICTC and DMC theories suggest that spiritual values, such as Islamic Nahdliyah, can improve performance (Liu and Yang, 2019; Malhotra, 2021). By incorporating these values into the way of life wi- thin a community, spirituality can serve as a superior resource for achieving uniqueness and power competitiveness, leading to superior performance.

Additionally, this research strengthens the appli- cation of social identity theory in Nahdliyah values, as Frindte (2021) suggests individuals increase their role and experience to demonstrate collective identity. Implementing NSV in NU community groups can improve marketing and financial performance (Maulida and Santoso, 2022).

The theoretical implication of this study is focusing on the role of unique resources based on spiritual value, specifically Nahdliyah, in increasing the performance of the MSMEs. This research adds insight into implementing community businesses based on the Islamic communities, such as Nahdlatul Ulama, the world's largest mass organi-

zation based on religion. The study also strengthens the implementation theory of social identity in religious areas, such as the NU Entrepreneurs As- sociation. Identity social theory states that accu- mulating values customized by the community can increase performance (Hendar et al., 2017a).

The findings support the proposition that NU's values, such as Gusjigiang, Nahdlattujar, and Mabaadi Khairai Ummah (MKU), can be formatted as superior resources as a competitive advantage(TriCahyaetal.,2021).Thistheorystrengthens the resource advantage competitive theory. The study enriches the study among MSMEs based on religious/spiritual communities, such as HPN. The results show that organizations based on spirituality are also crucial for developing able superiors for increasing business performance. That includes digital, e-commerce, marketing, modern entrepreneurs, ICT, network, market knowledge, and customer capability.

IMPLICATIONS

The results of this study are in line with the theory of resource competitive advantage, where this research can explain the role of the unique specific resources based on the spiritual value, which is Nahdliyah spiritual value in improving the superior performance of the MSMEs business, so that this research can add insight in another viewpoint in the implementation on business community based on Islamic community, such as Nahdlatul Ula- ma, the biggest mass organization based on the religion in the world. Therefore, this research also strengthens the implementation of social identity theory in the religious area (in the NU Entreprene- urs Association). Identity social theory states that if the accumulation of group (community) values is adjusted into an individual's self-concept in the form of knowledge resources, it will be able to improve performance. The finding supports the proposition that NU's values are in the form of Gus- jigang, Nahdlatuttujar, and Mabaadi Khaira Um- mah if formatted in a framework as a superior resource as a competitive advantage to improve bu- sinessperformanceandindividualperformanceto- gether. In this case, the theory of social identity theory strengthens the resource advantage competitive theory.

Study results also enrich the study-MSMEs based on religious/spiritual communities such as

(15)

636

HPN. The results of this study indicate that organizations based on spirituality are also significant in developing superior capabilities to improve business performance. The capabilities referred to are digital, e-commerce, marketing, modern entrepreneur, ICT, network, market knowledge, and sense of customer capability.

RECOMMENDATIONS

Future research is necessary due to one of the results of this study that the relationship between MP and FP is not significant. On the other hand, the MP status changes from an intervening variable to an exogenous variable. For this reason, it is necessary to design a further research model where placing the MP variable is expected to mediate the relationship of DMC, ICTC, and EC to FP, as can be developed from Fig. 2 above.

This study discusses NSV by calculating several variables that have been described previous- ly. The limitation of this research is that exogenous variables can only contribute to endogenous variables of 0.751. Even though they are good enough, they must be improved by adding other variables such as intellectual capital, cloud services, fi- nancialtechnology,financialinclusion,ande-com-

merce. The sample used in this study was compre- hensive and heterogeneous so that no conclusions could be drawn and applied to MSMEs due to differences in criteria or types of business. Future research should focus on a kind of business.

CONCLUSIONS

The study reveals that NSV (Natural Reso- urce Value) plays a crucial role in the relationship between DMC, ICTC, EC, and FP in the spiritual mass community (HPN) with a Gusjigang way of life. Resource competitive advantage is essential for achieving superior business performance, and digital marketing strategies, entrepreneurs, and ICT technology can enhance MSMEs' financial performance. NSV can explain variations in financial performance among NU, and its implementation can improve business performance and strengthen the implementation of spirituality theory in MSMEs. This theory can lead to better strategic decisions in product, service, price, and sales strategies, ultimately improving the financial performance of MSMEs in the religious community sec- tor.

The Nahdliyah movement introduces a concept of spiritual value in business, incorporating resource advantage theory and social identity theory. The social identity theory emphasizes group values and cooperation, while digital, e-commerce, marketing, modern entrepreneurship, ICT, network, market knowledge, and customer needs are crucial for success in Islamic religious communities. This research highlights the importance of these capabilities in improving financial performance in the current era. However, the exogenous variable, intellectual capital, cloud services, financial technology (fintech), financial inclusion, and e- commerce, is limited and cannot be applied to the MSMEs due to differences in criteria or business types. Future research should focus on business and design a model where the MP variable medi- ates the relationship between DMC, ICTC, and EC to FP.

REFERENCES

Abrokwah-Larbi, K. and Awuku-Larbi, Y. 2023.

TheImpactofArtificialIntelligenceinMar- keting on the Performance of Business Or- ganizations: Evidence from SMEs in an Emerging Economy. Journal of Entrepre- neurship in Emerging Economies. DOI: htt ps://doi.org/10.1108/JEEE-07-2022-0207.

Alarcón-del-Amo, M.-C., Rialp-Criado, A., and Rialp-Criado, J. 2018. Examining the Im- pact of Managerial Involvement with Social Media on Exporting Firm Performance. In- ternational Business Review, 27(2), pp. 355 –366. DOI: https://doi.org/10.1016/j.ibusre v.2017.09.003.

Bauman, A., McFadden, D. T., and Jablonski, B.

B. R. 2018. The Financial Performance Im- plications of Differential Marketing Strate- gies: Exploring Farms that Pursue Local Markets as a Core Competitive Advantage.

Agricultural and Resource Economics Re- view, 47(3), pp. 477–504. DOI: https://doi.

org/10.1017/age.2017.34.

Cahyono, Y., Purwoko, D., Koho, I. R., Setiani, A.,Supendi,Setyoko,P.I.,Sosiady,M.,and Wijoyo, H. 2023. The Role of Supply Chain Management Practices on Competitive Ad- vantage and Performance of Halal Agroin- dustry SMEs. Uncertain Supply Chain Ma- nagement, 11(1), pp. 153–160. DOI: https://

(16)

637 doi.org/10.5267/j.uscm.2022.10.012.

Chakraborty,T.,Bhandari,H.,andMittal,A.2022.

Examining Teachers' Satisfaction with the New Normal in a Disruptive Online Hospi- tality, Travel, and Tourism Education Sys- tem.GlobalKnowledge,Memory,andCom- munication. DOI: https://doi.org/10.1108/G KMC-04-2022-0095.

De Pater, C., Verschuuren, B., Elands, B., van Hal, I., and Turnhout, E. 2023. Spiritual Values in Forest Management Plans in British Co- lumbia and the Netherlands. Forest Policy and Economics, 151(April), pp. 102955.

DOI: https://doi.org/10.1016/j.forpol.2023.

102955.

Dela Cruz, N. A., Villanueva, A. C. B., Tolin, L.

A., Disse, S., Lensink, R., and White, H.

2023. PROTOCOL: Effects of Interventi- onstoImproveAccesstoFinancialServices for Micro‐, Small‐ and Medium‐Sized En- terprises in Low‐ and Middle‐Income Co- untries: An Evidence and Gap Map. Camp- bell Systematic Reviews, 19(3). DOI: https:

//doi.org/10.1002/cl2.1341.

Estensoro, M., Larrea, M., Müller, J. M., and Sisti, E. 2022. A Resource-Based View on SMEs Regarding the Transition to More Sophisti- cated Stages of Industry 4.0. European Ma- nagementJournal,40(5),pp.778-792.DOI:

https://doi.org/10.1016/j.emj.2021.10.001.

Fahmi, A. N. 2020. Wapres RI Hadiri Harlah Hi- mpunan Pengusaha Nahdliyin, Ini Pesan- nya. Timesindonesia.Co.Id. https://timesind onesia.co.id/peristiwa-nasional/302020/wa pres-ri-hadiri-harlah-himpunan-pengusaha- nahdliyin-ini-pesannya.

Fauzi, M. U. 2019. Implementasi Konsep “Mabadi Khaira Ummah Nahdlatul Ulama” sebagai BentukModerasiIslamdiKabupatenNgan- juk. Tafhim Al-’Ilmi, 11(1), pp. 119–147.

DOI: https://doi.org/10.37459/tafhim.v11i1 .3558.

Fesharaki, F. 2019. Entrepreneurial Passion, Self- efficacy, and Spiritual Intelligence among Iranian SME Owner–Managers. Psycholog- ical Studies, 64(4), pp.429–435. DOI: https:

//doi.org/10.1007/s12646-019-00507-0.

Frindte, Wolfgang. 2021. Social Identity and In- tergroup Relations. (March 2016). DOI: 10.

1007/978-3-658-13213-2.

Fujita, M., Harrigan, P., and Soutar, G. N. 2018.

Capturing and Co-Creating Student Experi- ence in Social Media: A Social Identity Theory Perspective. Journal of Marketing Theory and Practice, 26(1–2), pp. 55–71.

DOI:https://doi.org/10.1080/10696679.201 7.1389245.

Gregory, G. D., Ngo, L. V., and Karavdic, M.

2019. Developing E-Commerce Marketing Capabilities and Efficiencies for Enhanced Performance in Business-to-Business Ex- port Ventures. Industrial Marketing Mana- gement, 78, pp. 146–157. DOI: https://doi.o rg/10.1016/j.indmarman.2017.03.002.

Gyamera, E., Abayaawien Atuilik, W., Eklemet, I., Henry Matey, A., Tetteh, L. A., and Kw- asi Apreku-Djan, P. 2023. An Analysis of the Effects of Management Accounting Ser- vicesontheFinancialPerformanceofSME:

The Moderating Role of Information Tech- nology. Cogent Business and Management, pp. 10(1). DOI: https://doi.org/10.1080/233 11975.2023.2183559.

Hai, N. M., Minh-Tu, L., and Dung, N. D. 2023.

Survival of SMEs: Business Environment, Financial Performance, Bank Credit, and Accounting Errors. Macroeconomics and Finance in Emerging Market Economies.

DOI:https://doi.org/10.1080/17520843.202 3.2238993.

Hair, J. F., Tomas, M. H., Ringle, C., and Sarsted- te, M. 2017. A Primer on Partial Least Squ- ares Structural Equation Modeling (PLSM- SEM).

Harwood, J. 2020. Social Identity Theory. In The International Encyclopedia of Media Psy- chology, (pp. 1–7). Wiley. DOI: https://doi.

org/10.1002/9781119011071.iemp0153.

Hasan, Amiruddin. 2021. An Overview of E-Com- merce Adoption in Indonesian SMEs. DOI:

10.1088/1742-6596/1811/1/012104.

Hendar,Ferdinand,A.T.,andNurhayati,T.2017a.

Introducing the Religio-Centric Positional Advantage to Indonesian Small Businesses.

Management and Marketing, 12(1), pp. 78–

102. DOI: https://doi.org/10.1515/mmcks-2 017-0006.

Hendar, H., Ferdinand, A. T., and Nurhayati, T.

2017b. Introducing the Religio-Centric Po- sitional Advantage to Indonesian Small Bu-