Human Resource Management, Digital Transformation, and Sustainable Business for SMEs Growth with Market Adaptation

Andry Roy PS; Minasari Nasution

doi:10.55227/ijhess.v5i2.1995

Authors

Andry Roy PS Departement of Accountancy, Medan, Indonesia
Minasari Nasution Departement of Marketing Management Accountancy , Medan, Indonesia

DOI:

https://doi.org/10.55227/ijhess.v5i2.1995

Keywords:

Human Resource Management, Digital Transformation, Sustainable Business, Market Adaptation, SME Growth

Abstract

This study examines the impact of human resource management (HRM), digital transformation, and sustainable business practices on the growth of culinary and coffee small and medium enterprises (SMEs) in Balige, with market adaptation as a moderating variable. A quantitative method was applied using structured questionnaires distributed to SME owners and managers. Data analysis employed Partial Least Squares Structural Equation Modeling (PLS-SEM) through SmartPLS 4. The results demonstrate that HRM, digital transformation, and sustainability significantly enhance SME growth, while market adaptation strengthens these relationships. R² and Q² values confirm strong explanatory and predictive power. This research contributes theoretically by integrating HRM and sustainability perspectives into SME growth literature and provides practical implications for SMEs to adopt digital and adaptive strategies in a competitive market.

References

Badan Pusat Statistik. (2023). Gross regional domestic product of Toba Regency by business field. Toba Regency BPS.

Ministry of Cooperatives and SMEs. (2022). Annual report of Indonesian MSMEs. Jakarta: Kemenkop UKM.

Raharjo, S., & Yuliana, I. (2021). Strategies for strengthening MSMEs in the digital era. Journal of Economics and Business, 8(2), 112–123.

Pratama, H. (2022). Digital transformation of MSMEs during the pandemic. Journal of Economic Transformation, 4(1), 45–55.

Wijaya, R. D., & Sari, M. (2021). The use of social media for MSME marketing. Journal of Digital Communication and Business, 3(3), 78–89.

Andini, L., & Setiawan, D. (2020). Digital literacy and its impact on MSME operational efficiency. Journal of Technology and Business, 2(1), 55–63.

Fitriani, H. (2021). The digital divide among micro-business actors. Journal of Socio-Economics, 6(2), 99–107.

Simanjuntak, P., & Lumbantoruan, T. (2021). Analysis of managerial competence of MSME actors in Toba area. Journal of Management and MSMEs, 5(1), 34–44.

Sihombing, D., & Sitompul, M. (2020). Competency-based human resource development. Journal of Economic Development, 3(2), 88–95.

Yusuf, M., & Hutagalung, S. (2022). Business management training strategies for MSMEs. Journal of Education and Entrepreneurship, 7(1), 23–30.

Roy, A., & Siahaan, T. (2023). Strengthening MSME human resources through digital literacy training in Toba region. Journal of Polytechnic Community Service, 5(2), 112–120.

Wahyuni, F., & Ardiansyah, R. (2022). Utilization of organic waste in the circular economy. Journal of Green Economy and Environment, 3(1), 22–31.

Nugroho, B. (2021). Coffee waste as an alternative economic potential. Journal of Agroindustry and Environment, 4(2), 44–51.

Siregar, A., & Lestari, I. (2020). ESG implementation in MSMEs. Journal of Sustainable Business and Governance, 5(3), 65–75.

Utami, W. (2022). Green business strategies in the SME sector. Journal of Business Innovation, 6(2), 77–85.

Roy, A. (2022). Utilization of coffee waste as biochar for green MSMEs. Journal of Sustainable Innovation, 4(1), 34–41.

Lumbanraja, P., & Pasaribu, S. (2023). Integration of digital strategies in strengthening local MSMEs. Journal of Digital Economy, 2(1), 91–102.

Tambunan, T. (2020). Challenges of MSMEs in the Industry 4.0 era. Journal of Economics and Development, 11(3), 59–70.

Hasan, R., & Devi, A. (2022). Competitive risks of MSMEs in the global ecosystem. Journal of Strategic Management, 8(1), 47–56.

Ramadhani, M. (2023). Consumer preferences of millennials and Gen Z towards local products. Journal of Consumer Behavior, 4(2), 39–50.

Roy, A., & Harahap, F. (2024). Integrative MSME model based on HRM, digitalization, and green economy in North Sumatra. Journal of MSME Strategic Management, 6(1), 50–63.

Sihite, E., & Nababan, R. (2022). Analysis of the threat of market loss for MSMEs in the Lake Toba area. Journal of Regional Economics, 5(1), 28–36.

Roy, A. (2023). Designing an integrated MSME business model with a market adaptation approach. Journal of Digital Economic Research, 2(2), 78–85.

Roy, A., & Nasution, M. (2022). Synergy of HRM, technology, and sustainability in enhancing the competitiveness of local MSMEs. Journal of Management and Accounting Sciences, 3(4), 101–109