Effect Of Entrepreneurial Motivation And Competitive Excellence On Business Success (Case Study In Clothing UMKM Business In Mabar Medan Deli District)
Effect of Entrepreneurial Motivation and Competitive Excellence on Business Success: Case Study on Clothing MSMEs in Mabar, Medan Deli District
Introduction
In today's competitive business landscape, entrepreneurs and small and medium-sized enterprises (SMEs) are constantly seeking ways to improve their chances of success. One of the key factors that can contribute to business success is entrepreneurial motivation, which drives individuals to start and develop a business. Another crucial factor is competitive advantage, which enables businesses to offer more value to customers compared to their competitors. This study aims to analyze the effect of entrepreneurial motivation and competitive advantage on business success among micro, small, and medium enterprises (MSMEs) in the clothing sector in Mabar, Medan Deli District.
Methodology
This study uses a census method, where all 50 MSMEs in the clothing sector in Mabar, Medan Deli District are respondents. Data collection was carried out through a questionnaire for primary data and literature study for secondary data. The analysis method applied includes descriptive analysis and multiple linear regression.
Entrepreneurial Motivation: An Important Foundation for Business Success
Entrepreneurial motivation is the main driver for individuals to start and develop a business. In the context of MSME clothing in Mabar, this motivation can come from the desire to achieve financial freedom, the desire to innovate, and the spirit to provide employment to others. In many cases, business actors with strong motivation tend to be more persistent in facing challenges, adapting to market changes, and investing in the development of their business.
Entrepreneurial motivation can be categorized into two types: intrinsic motivation and extrinsic motivation. Intrinsic motivation is driven by personal satisfaction and enjoyment, while extrinsic motivation is driven by external factors such as financial rewards. A study by Gagné and Deci (2005) found that intrinsic motivation is a stronger predictor of entrepreneurial success than extrinsic motivation.
Competitive Advantage: The Key to Winning Market Competition
On the other hand, competitive advantage is the ability of a business to offer more value to customers compared to competitors. In the clothing industry, this can be reflected in product quality, unique design, good customer service, and effective marketing strategies. MSMEs that succeed in creating competitive advantage can attract the attention of consumers and increase their market share.
Competitive advantage can be achieved through various strategies, including product differentiation, cost leadership, and focus on a specific market segment. A study by Porter (1985) found that businesses that focus on product differentiation tend to have a higher market share and profitability compared to those that focus on cost leadership.
The Impact of Entrepreneurial Motivation and Competitive Advantage on Business Success
This study found that both entrepreneurial motivation and competitive advantage have a positive and significant positive influence on the success of the MSME clothing business in the region. Partial testing also indicates that both of these variables contribute positively and significantly to the success of the managed business.
The results of this study provide valuable insights for MSME actors in Mabar, Medan Deli District. By increasing entrepreneurial motivation and developing strategies to create competitive advantage, business people can increase their chances of success. Training and workshops to improve entrepreneurial skills and marketing strategies that focus on product differentiation can be an effective step.
Implications for MSME Actors
The results of this study have several implications for MSME actors in Mabar, Medan Deli District. Firstly, MSME actors should focus on increasing their entrepreneurial motivation by setting clear goals and developing a strong sense of purpose. Secondly, MSME actors should develop strategies to create competitive advantage by focusing on product differentiation, cost leadership, or a specific market segment.
Conclusion
Entrepreneurial motivation and competitive advantage are proven to have a significant positive impact on the success of the MSME clothing business in Mabar, Medan Deli District. To create an ecosystem that supports the growth of MSMEs, related stakeholders, including the government and financial institutions, it is necessary to work together in providing supporting programs that facilitate the development of motivation and competitive advantage. Thus, it is expected that there will be an increase not only in the success of individual business actors, but also broader economic growth in the region.
Recommendations
Based on the findings of this study, the following recommendations are made:
- Increase entrepreneurial motivation: MSME actors should focus on increasing their entrepreneurial motivation by setting clear goals and developing a strong sense of purpose.
- Develop competitive advantage: MSME actors should develop strategies to create competitive advantage by focusing on product differentiation, cost leadership, or a specific market segment.
- Provide training and workshops: Training and workshops to improve entrepreneurial skills and marketing strategies that focus on product differentiation can be an effective step.
- Collaborate with stakeholders: Related stakeholders, including the government and financial institutions, should work together in providing supporting programs that facilitate the development of motivation and competitive advantage.
By implementing these recommendations, MSME actors in Mabar, Medan Deli District can increase their chances of success and contribute to broader economic growth in the region.
Limitations of the Study
This study has several limitations. Firstly, the study only focuses on MSMEs in the clothing sector in Mabar, Medan Deli District, and may not be generalizable to other industries or regions. Secondly, the study only uses a census method, which may not be representative of the entire population of MSMEs in the region.
Future Research Directions
Future research should focus on exploring the impact of entrepreneurial motivation and competitive advantage on business success in other industries and regions. Additionally, future research should investigate the role of other factors, such as market conditions and government policies, in influencing business success.
References
Gagné, M., & Deci, E. L. (2005). Self-determination theory and optimal motivation: A conceptual framework. In J. M. Levine & M. A. Hogg (Eds.), Encyclopedia of social psychology (pp. 1-10). Thousand Oaks, CA: Sage.
Porter, M. E. (1985). Competitive advantage: Creating and sustaining superior performance. New York: Free Press.
Frequently Asked Questions (FAQs) about Entrepreneurial Motivation and Competitive Advantage
Q: What is entrepreneurial motivation?
A: Entrepreneurial motivation is the driving force behind an individual's decision to start and develop a business. It is the desire to achieve financial freedom, innovate, and provide employment to others.
Q: What are the types of entrepreneurial motivation?
A: There are two types of entrepreneurial motivation: intrinsic motivation and extrinsic motivation. Intrinsic motivation is driven by personal satisfaction and enjoyment, while extrinsic motivation is driven by external factors such as financial rewards.
Q: What is competitive advantage?
A: Competitive advantage is the ability of a business to offer more value to customers compared to competitors. It can be reflected in product quality, unique design, good customer service, and effective marketing strategies.
Q: How can businesses achieve competitive advantage?
A: Businesses can achieve competitive advantage through various strategies, including product differentiation, cost leadership, and focus on a specific market segment.
Q: What is the relationship between entrepreneurial motivation and competitive advantage?
A: Entrepreneurial motivation and competitive advantage are interrelated. A business with high entrepreneurial motivation is more likely to develop strategies to create competitive advantage, and vice versa.
Q: How can MSMEs in Mabar, Medan Deli District increase their entrepreneurial motivation and competitive advantage?
A: MSMEs in Mabar, Medan Deli District can increase their entrepreneurial motivation by setting clear goals and developing a strong sense of purpose. They can also develop strategies to create competitive advantage by focusing on product differentiation, cost leadership, or a specific market segment.
Q: What are the implications of this study for MSME actors?
A: The results of this study provide valuable insights for MSME actors in Mabar, Medan Deli District. By increasing entrepreneurial motivation and developing strategies to create competitive advantage, business people can increase their chances of success.
Q: What are the limitations of this study?
A: This study has several limitations. Firstly, the study only focuses on MSMEs in the clothing sector in Mabar, Medan Deli District, and may not be generalizable to other industries or regions. Secondly, the study only uses a census method, which may not be representative of the entire population of MSMEs in the region.
Q: What are the future research directions?
A: Future research should focus on exploring the impact of entrepreneurial motivation and competitive advantage on business success in other industries and regions. Additionally, future research should investigate the role of other factors, such as market conditions and government policies, in influencing business success.
Q: What are the recommendations for MSME actors?
A: Based on the findings of this study, the following recommendations are made:
- Increase entrepreneurial motivation: MSME actors should focus on increasing their entrepreneurial motivation by setting clear goals and developing a strong sense of purpose.
- Develop competitive advantage: MSME actors should develop strategies to create competitive advantage by focusing on product differentiation, cost leadership, or a specific market segment.
- Provide training and workshops: Training and workshops to improve entrepreneurial skills and marketing strategies that focus on product differentiation can be an effective step.
- Collaborate with stakeholders: Related stakeholders, including the government and financial institutions, should work together in providing supporting programs that facilitate the development of motivation and competitive advantage.
By implementing these recommendations, MSME actors in Mabar, Medan Deli District can increase their chances of success and contribute to broader economic growth in the region.
Conclusion
Entrepreneurial motivation and competitive advantage are crucial factors that can contribute to business success. This study provides valuable insights for MSME actors in Mabar, Medan Deli District, and highlights the importance of increasing entrepreneurial motivation and developing strategies to create competitive advantage. By implementing the recommendations outlined in this study, MSME actors can increase their chances of success and contribute to broader economic growth in the region.