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The purpose of this paper is to investigate the innovation value chain (IVC) that encompasses knowledge sourcing, transformation and exploitation activities among Indonesian manufacturing firms by using data from the Indonesia Innovation Survey.

A simple approach of single equation Probit model, Logit regression and Tobit regression are used in the first, second and third stages of IVC consecutively.

This study finds the existence of a synergistic relationship between internal and external sources of knowledge as well as among external sources of knowledge. In terms of the second link of the IVC, internal R&D plays an important role that positively influences knowledge transformation into all types of innovation and innovation success. External knowledge that has a similar pattern in shaping innovation mainly comes from market and open sources. Scientific institutions tend to contribute to innovation negatively, and few positive impacts on process innovation are observed from government R&D and non-profit R&D institutions. Informal knowledge is more likely to influence technological than non-technological innovation.

Finally, the limitations of this study need to be acknowledged. Issues related to firms’ sectors have not been discussed in this study, and as a result, sectors’ effects on the three links of IVC cannot be detected. This study is a cross-sectional in nature, as a result, the dynamic of Indonesian manufacturing firms’ IVC is missing. Hence, future studies may address this limitation by conducting a longitudinal study.

This study is different from the previous IVC studies owing to the following reasons. Firstly, in this study, a broader source of knowledge is tested. Secondly, the wider innovation (technological and non-technological innovation) is also assessed.

The purpose of this paper is to investigate the technical efficiency (TE) of micro and small enterprises (MSEs) and its determinants in the Indonesian manufacturing sector covering comprehensive subsectors.

This research uses the data from the micro and small industry survey sourced from the Indonesian Bureau of Central Statistics for the period 2010–2015. The TE is estimated using data envelopment analysis (DEA) with bootstrapping approach. The TE is also estimated at the firm-level survey data, classified at the five-digit level of the International Standard Industrial Classification system. In addition, a truncated regression model is applied to estimate the effects of the determinants on the TE.

This research finds that there is a low average TE of the MSEs for the subsectors investigated. It is also found that the TE is associated with firm size, location, export orientations on domestic and world markets, firm age, level of technology, and owner education.

The literature investigating the TE of the MSEs and its determinants is still rare in Indonesia. Most of the previous research limited the studies for specific subsectors and/or specific small regions. Therefore, this research has a contribution in measuring the TE of the MSEs for comprehensive subsectors as well as its relation with the determinants in the Indonesian manufacturing sector. Also, the DEA with bootstrapping approach is applied to estimate the TE of the firms based on each relevant subsector, which is rare in the previous research of the Indonesian MSEs.

This paper aims to investigate the adoption barriers of Industry 4.0 in the Indonesian manufacturing supply chains.

The mixed method was deployed to validate the findings. First, the qualitative study was conducted based on the interviews. Then, the companies were approached using filter questions on the involvement in adopting industry 4.0 and its impact on the supply chain.

Based on the qualitative study, nine main barriers were found in the thematic analysis. Thus, to get a consensus on the barriers in the industry, the barrier indicators were tested using a structural equation model retrieved from 173 small and medium Indonesian manufacturing firms. Results indicate that five main barriers (e.g. unclear Industry 4.0 policy, higher-risk investment, insecure data sharing, lack of expertise and lack of incentive) are confirmed as the adoption barriers.

The successful adoption of supply chain integration with Industry 4.0 technology can strengthen the manufacturing sector and competitiveness. Therefore, this study can be a complimentary assessment to evaluate the Indonesia Industry 4.0 Readiness Index (INDI 4.0) and the effectiveness of the government support program.

The results can be used as the framework to foresee the successful implementation of smart manufacturing supply chain management and its integration. Therefore, the authors proposed the framework to foresee the successful implementation of smart manufacturing, supply chain management and integration.

This study aims at examining the impact of corporate governance on dividend policy among Indonesian companies. There are two theories of the effect of corporate governance on dividend policy: substitution and outcome theory. Substitution theory argue that corporate governance have negative effect on dividend policy, while outcome theory argue that corporate governance have positive effect on dividend policy. Therefore, this study investigates the effect of corporate governance on dividend policy in Indonesia. This study aims at examining the impact of corporate governance on dividend policy among Indonesian companies. There are two theories of the effect of corporate governance on dividend policy: substitution and outcome theory. Substitution theory argue that corporate governance have negative effect on dividend policy, while outcome theory argue that corporate governance have positive effect on dividend policy. Therefore, this study investigates the effect of corporate governance on dividend policy in Indonesia.

The sample of this research comprises 248 firms from Indonesian Stock Exchange during 2004-2006. This research using Transparency and Disclosure Index (TDI) to measure corporate governance in Indonesia

We find that TDI are low among Indonesian firms, with a score of 32 per cent out of the maximum point. This score indicates that Indonesian corporate governance is still low. The results show that there is a negative relation between corporate governance and dividend policy in Indonesia. Thus, the Indonesian companies pay more dividends when corporate governance practice is low. This result confirms applicable of substitution theory in Indonesia.

This research focuses on manufacturing industry in Indonesia. Therefore, the conclusions of this research apply on the manufacturing companies in Indonesia

This research shows that companies with poor corporate governance pay dividend higher than companies with better corporate governance. Thus, investor can use this information to make investment decision.

This research provides evidence on the negative effect of corporate governance on dividend policy in Indonesia (substitution theory).

Supply chain integration (SCI) is a set of practices driven by many factors and circumstances. The purpose of this paper is to examine firms’ internal and external drivers of SCI, evaluate the impact of the integration on firm performance, and further investigate the moderating role of organizational culture in strengthening the relationships between firms’ drivers and SCI.

For the purpose of this study, manufacturing firms were identified as the focal firms in supply chains, and thus data were collected through a survey of 223 Indonesian-based manufacturing firms. Two informants from each firm became the respondents. Structural equation modeling was used to analyze the data.

This study confirmed the positive relationship between SCI and firm performance. The results also indicated that internal driver, or specifically firms’ customer orientation (CO), triggered the initiation of SCI. Organizational culture, in terms of external focus, positively influenced the relationship between CO and SCI.

This study illustrates the important role of organizational culture in determining the shape of the relationship between firms’ drivers and SCI. The results of this study enhance the understanding of SCI, especially related to types of organizational culture that could promote the integration.

This study brings a different dimension of SCI as this study provides evidence from a developing country, which might implement different practices as compared those of developed countries. This study provides a measure of internal drivers, which has not been empirically investigated. The new measure was tested and validated using a rigorous process, and thus could be employed in other studies with different settings.

This research tries to fill a gap in research and to suggest a rigorous quantitative approach to benchmarking marketing productivity. Data envelopment analysis (DEA) is useful in identifying the best‐performing units to be benchmarked against as well as in providing actionable measures for improvement of a company's marketing performance.

This study applied the DEA approach to aid traditional benchmarking activities and to provide guidance to managers, and to evaluate the productivity and efficiency of manufacturing firms listed at the Indonesian Stock Exchange as a result of their marketing activities. The time period observed is 2001‐2007. The total number of manufacturing firms observed is 94.

The evidence shows that on average, this industry experienced total productivity decline by over the observation periods, mainly due to deterioration of managerial efficiency.

The paper compares public listed manufacturing firms in Indonesia.

This study aims to examine open innovation that consists a wide range of external knowledge search activities, such external search breadth and depth, external R&D, cooperation and acquisition activities, as a response to different innovation barriers faced by Indonesian firms.

Data are derived from Indonesia innovation survey. Exploratory factor analysis is used to identify and combine innovation barriers variables. Ordered logistic estimation is used to measure the impact of innovation barriers on firm openness decision. Logistic regression is used to measure the impact of innovation barriers on firm openness indicators such as external R&D, cooperation and acquisition as the variables are binary. Finally, Tobit regression is used to measure the impact of firm openness decision on innovation performance.

The main findings indicate that different barriers to innovation lead to different firms’ openness decisions, and different decisions on openness have differentiated influence on innovation performance.

This study contributes to the innovation barrier literature by empirically testing whether experiencing barriers to innovation is associated with a broader external knowledge search activity. Previous studies tend to link innovation barriers with a narrow activity as indicated by external knowledge searching widely and deeply.

The purpose of this study is to investigate the effects of Indonesia’s technical barriers to trade (TBT) on manufacturing exports.

This study uses the UNCTAD database to calculate the coverage ratio and frequency index of TBTs, which represent the restrictiveness of TBTs on imports. The effects of TBTs are estimated using the gravity model (Tinbergen, 1962) and the pseudo-Poisson maximum likelihood methodology (Santos Silva and Tenreyro, 2006, 2011).

An estimation on the manufacturing sector shows that TBT reduces Indonesia’s manufacturing exports. However, the effect of TBT is different in disaggregated manufacturing sector. TBT is found to reduce exports of chemicals and transportation but increase exports of metal and textiles. This finding supports the empirical evidence that TBT can create trade-impeding and demand-enhancing effects on trade flows. The negative effect of TBT on chemical and transportation exports implies that the cost of compliance is higher than the increasing demand rate. This finding suggests the need for policy evaluation and improvements for restrictive TBT. As Indonesia is still highly dependent on imported inputs, restrictive TBT can potentially reduce the productivity of the Indonesian manufacturing sector.

This study aims to investigate the effects of TBT in Indonesia, as a manufacturing-based economy that relies heavily on imported intermediate inputs. Furthermore, this study contributes to the literature by using country-specific techniques and aggregated and disaggregated manufacturing sectors as subjects for study. Meanwhile, previous studies use multi-country and multi-product approaches and focus on the aggregate sector. This study estimates the effects of TBT on the disaggregated sector, given its high share of imported inputs and reliance on export-oriented industries. TBT is constructed in a more detailed product level (HS-4 digit level) to provide more accurate results.

The Indonesian government has been trying to support the development of small and medium enterprises (SMEs) in the country, as these enterprises are expected to play a crucial role not only for employment creation but also for GDP formation and export development. The paper aims to address the following three questions. First, are networks important for the development of SME clusters, especially for those involved in export activities? Second, in what type of clusters are networks well developed? Third, what is the role of government; does it also play as an important network for SME cluster development?

This paper is based on an ongoing research on the importance of networks in the development of export‐oriented SME clusters in Indonesia. Although the paper also discusses other important issues related to the development of SMEs in the country, i.e. constraints facing the enterprises and women entrepreneurs, the paper focuses on the importance of networks.

First, SMEs are of overwhelming importance to Indonesia because they account for more than 90 percent of all firms outside of the agricultural sector. Second, the main constraints faced by small entrepreneurs are, lack of finance and difficulties in marketing. Third, the representation of women entrepreneurs in Indonesia is still relatively low which can be attributed to various factors, e.g. low level of education and lack of training opportunities that make Indonesian women severely disadvantaged in both the economy and society. Finally, although in general Indonesia is not well represented with small and medium industrial clusters that feed into global commodity chains, some clusters have gradually become export‐oriented. Among many factors, well developed networks especially with traders, trading houses, and foreign tourists are indeed an important factor for their increasingly export activities. Even these agents have played more important role than supports from government for their successful export.

The paper examines the importance of networks for the export‐oriented SME clusters in Indonesia.

The purpose of this study is to provide a framework of managerial responses to the Industry 4.0 phenomenon, which has impacted the productivity of Indonesian manufacturing companies while revolutionizing global industries.

The study employs qualitative research using the Grounded Theory Method since research in this area is still in its preliminary stages. The study elicits insights from 12 operation managers through a semi-structured interview and a focus group discussion. Using content analysis, the study formulates relationships among Industry 4.0 initiatives, its driving factors and challenges as well as critical success factors and the expected benefits.

The findings reveal that Indonesian manufacturers have engaged in Industry 4.0 initiatives: cyber-physical systems, the internet of things, Big Data and cloud computing. These initiatives require managers to adopt best practices, appoint champions as change agents, conduct training and even tailor the job qualifications of their subordinates to suit the current technology.

The qualitative method allows an in-depth investigation that is synthesized into a conceptual framework, but this framework still needs to be empirically tested. The study is currently based on informants from large manufacturing companies. Future studies could scale up the research and validate the findings.

This exploratory framework could guide managers in their strategic and operational decisions while embracing the Industry 4.0 transformation inside the organization.

Prior studies examining the adoption of Industry 4.0 principles by Indonesian manufacturing companies are rare. Furthermore, conceptual studies dominate the existing literature related to the Industry 4.0 concept. This study attempts to fill the gap and provides a framework that is based on grounded empirical data of manufacturing companies in Indonesia, a newly industrialized economy.