The Effect of Adaptive Entrepreneurship on Work Productivity with Innovative Behavior as a Mediating Variable in Tape-Producing MSMEs in Banjarsari Village

Abstract

Micro, Small, and Medium Enterprises (MSMEs) play a crucial role in Indonesia’s economy by contributing significantly to employment generation and national income. Despite their importance, MSMEs often face challenges related to limited resources, dynamic market conditions, and varying levels of productivity, particularly in rural-based industries. This study aims to examine the effect of adaptive entrepreneurship on work productivity with innovative behavior as a mediating variable in tape-producing MSMEs in Banjarsari Village, Indonesia. This study employs a quantitative explanatory approach using a cross-sectional design. Data were collected from 95 MSME actors through structured questionnaires and analyzed using Structural Equation Modeling–Partial Least Squares (SEM-PLS). The results indicate that adaptive entrepreneurship has a significant relationship with both innovative behavior and work productivity. Innovative behavior is also found to significantly influence work productivity. However, innovative behavior does not mediate the relationship between adaptive entrepreneurship and work productivity. While this study provides valuable insights into the role of adaptive entrepreneurship in enhancing MSME productivity, its generalizability is limited due to the narrow scope of the research. The sample is confined to tape-producing MSMEs in Banjarsari Village, which may possess unique socio-economic, cultural, and industrial characteristics. As a result, the findings may not be fully applicable to MSMEs operating in different sectors or geographical contexts. Future research is encouraged to include a more diverse range of industries and regions to improve external validity and strengthen the generalizability of the findings.  This study highlights that productivity improvements in rural MSMEs are more strongly driven by direct adaptive capabilities rather than indirect innovation mechanisms.