Title : Logistic Capability and Total Quality Management Practice on SME's Performance
Authors:
1. Yakuttinah Marjan
3. Uswatun Hasanah
4. Yurilla Endah Muliatie
5. Indrianawati Usman
Department : Management
Journal Name: Journal of Distribution Science
Kinds of Journal : Q4
Keywords : Logistic Capability, TQM Practices, SME, Distribution, Non-financial Performance, Financial Performance
ABSTRACT
Purpose: This study aims to analyze and prove the effect of logistic capability and Total Quality Management practices on Micro, Small and Medium Enterprises (SME) performance directly or mediated by non-financial performance. Research design, data and methodology: This study tested the hypothesis using Hierarchical multiple regression analysis, the method of data collection in this study was using a questionnaire, the sampling technique was purposive sampling technique, with SME that has been established for more than 5 years and manufacturing. The data analyzed were 180 respondents using SPSS 25. Results: The findings showed that logistic capability has direct and indirect effects on SME financial performance and has a positive effect on SME financial performance mediated by non-financial performance. While the total quality management practices have a positive effect on SME financial performance mediated by non-financial performance. Thus, companies can achieve maximum financial performance if they invest in developing employee knowledge and concerning non-financial actions, such as employee satisfaction, innovation and proactively seeking market opportunities. Conclusions: In conclusion, one of the main factors that companies need to consider to improve financial performance is non-financial performance in mediating the effect of logistic capability and TQM practices on the financial performance of SMEs.