The Mediating Role of Innovation Capability in the Effect of Total Quality Management (TQM) on the Business Performance of Micro, Small, and Medium Enterprises (MSMEs) in the Food and Beverage Sector in Cimahi City
DOI:
https://doi.org/10.24256/kharaj.v8i3.12391Keywords:
Total Quality Management, Innovation Capability, Business Performance, MSMEs, food and beverageAbstract
Competition in the food and beverage sector is becoming increasingly intense, requiring Micro, Small, and Medium Enterprises (MSMEs) in Cimahi to maintain the quality of their products and services and to continue innovating in order to improve their business performance. This study aims to evaluate the impact of Total Quality Management (TQM) on MSME business performance, with innovation capacity serving as a mediating variable for MSMEs in the food and beverage sector in Cimahi City.
The research approach applied in this study is a quantitative method with a descriptive and verifiable focus. The sample consisted of 94 respondents working in the food and beverage SME sector in Cimahi, with data collected via a questionnaire using a 1–5 Likert scale and using stratified random sampling. Data analysis was conducted using the Partial Least Squares-Structural Equation Modeling (PLS-SEM) technique supported by SmartPLS software version 4.1.1.8.
The results of the study indicate that Total Quality Management has a positive and significant impact on business performance and innovation capability. Furthermore, innovation capability also exerts a significant positive influence on business performance and acts as a partial mediator in the relationship between Total Quality Management and business performance. The research model demonstrates a strong fit, as evidenced by a satisfactory Goodness of Fit value. Nevertheless, future researchers are encouraged to focus on enhancing innovative capacity so that companies can improve their business performance and sustainably remain competitive in the market
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