Triple Helix: the concept of synergy for SMEs to increase business performance

Abstract

The SME sector provides an essential economic contribution to the development and welfare of society, namely the Gross Domestic Product (GRDP). However, despite contributing to the economy and GDP, SMEs face several obstacles, including financial constraints, limited marketing and available resources. Synergy from various parties is needed to overcome this economic and social phenomenon. The intended synergy is between intellectuals, the government, and the business. The synergy of the three actors is termed the triple helix. This study aims to analyze the effect of the triple helix consisting of intellectuals,government, and the business community on the innovation and ability of SMEs, the effect of innovation on SMEs' ability and business performance,and the influence of ability on the business performance of SMEs. The sample was SMEs throughout Bali who are members of the Bali Bangkit exhibition,totaling 45 SMEs with criteria determined by the Bali Industry and Trade Department. Data analysis was carried out using the SmartPLS 3.0 program. The results show that SME innovation is influenced by academic support (intellectuals). The business community and government strongly support the ability of SMEs. Innovations made by SMEs can improve business capabilities. Likewise, SME business performance is determined by its innovation and capabilities. SMEs' business performance improvement based on innovations in business activities is determined more by academic support. The achievement of business results from SMEs based on their business capabilities tends to be determined by government support. The synergy increases the ability of SMEs to improve performance.