The Development of Small and Medium Entreprises Clusters in Indonesia

Small and Medium Enterprises (SMEs) in Indonesia are very important not only for employment creation, but also as important sources of economic growth and foreign currencies generation through exports. Since the early 1980s, the Indonesian government has adopted SME development policy through a clus...

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Main Authors: Tulus Tambunan, Hendrawan Supratikno
Format: Article
Language:English
Published: Universitas Gadjah Mada 2004-01-01
Series:Gadjah Mada International Journal of Business
Subjects:
Online Access:https://jurnal.ugm.ac.id/gamaijb/article/view/5532
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author Tulus Tambunan
Hendrawan Supratikno
author_facet Tulus Tambunan
Hendrawan Supratikno
author_sort Tulus Tambunan
collection DOAJ
description Small and Medium Enterprises (SMEs) in Indonesia are very important not only for employment creation, but also as important sources of economic growth and foreign currencies generation through exports. Since the early 1980s, the Indonesian government has adopted SME development policy through a clustering approach. This paper reviews the existing empirical studies on development of SME clusters in Indonesia. This paper deals with two main questions. First, what are the critical success factors of development of an SME cluster. Second to what extent this policy has contributed to the dynamic of SME clusters in the country. The paper argues that in many cases, the development policy has not been so successful. In essence, most failures can be attributed to the fact that one or more critical factors for successful SME cluster development were either not existing or not addressed correctly. Neglecting cluster linkage to markets is one reason of the failure. Prerequisite for successful cluster development is the cluster's potential to access to growing market, either domestic or abroad.
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spelling doaj.art-de8d55d52b1a435582e48d3b8bda03912022-12-21T17:13:49ZengUniversitas Gadjah MadaGadjah Mada International Journal of Business1411-11282338-72382004-01-0161294410.22146/gamaijb.55324858The Development of Small and Medium Entreprises Clusters in IndonesiaTulus Tambunan0Hendrawan Supratikno1Trisakti University, JakartaFaculty of Economics, Satya Wacana Christian University, SalatigaSmall and Medium Enterprises (SMEs) in Indonesia are very important not only for employment creation, but also as important sources of economic growth and foreign currencies generation through exports. Since the early 1980s, the Indonesian government has adopted SME development policy through a clustering approach. This paper reviews the existing empirical studies on development of SME clusters in Indonesia. This paper deals with two main questions. First, what are the critical success factors of development of an SME cluster. Second to what extent this policy has contributed to the dynamic of SME clusters in the country. The paper argues that in many cases, the development policy has not been so successful. In essence, most failures can be attributed to the fact that one or more critical factors for successful SME cluster development were either not existing or not addressed correctly. Neglecting cluster linkage to markets is one reason of the failure. Prerequisite for successful cluster development is the cluster's potential to access to growing market, either domestic or abroad.https://jurnal.ugm.ac.id/gamaijb/article/view/5532clustercritical success factorsSMEs
spellingShingle Tulus Tambunan
Hendrawan Supratikno
The Development of Small and Medium Entreprises Clusters in Indonesia
Gadjah Mada International Journal of Business
cluster
critical success factors
SMEs
title The Development of Small and Medium Entreprises Clusters in Indonesia
title_full The Development of Small and Medium Entreprises Clusters in Indonesia
title_fullStr The Development of Small and Medium Entreprises Clusters in Indonesia
title_full_unstemmed The Development of Small and Medium Entreprises Clusters in Indonesia
title_short The Development of Small and Medium Entreprises Clusters in Indonesia
title_sort development of small and medium entreprises clusters in indonesia
topic cluster
critical success factors
SMEs
url https://jurnal.ugm.ac.id/gamaijb/article/view/5532
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