Sustainability of Business Strategy Based on Indigenous Product Creativity in the Weaving Industry of Palm Oil Waste in Riau, Indonesia

Abstract

This study analyzes knowledge management and innovation based on indigenous product creativity to achieve a sustainable competitive advantage. The unit of analysis in this study was the artisans of the woven handicraft industry from palm oil stem waste, totaling 50 respondents using a census sampling of the entire population. The analysis tool of this research uses SEM PLS. The results of this study indicate that knowledge management and innovation affect sustainable competitive advantage with indigenous product creativity as mediation in the woven handicraft industry from waste palm oil stems. The findings succeeded in filling the gap in previous research that the heterogeneity of company resources is getting higher to achieve sustainable competitive advantage due to the indigenous factor of creativity as a mediation that can provide added value different from competitors. This research implication contributes to developing strategic management science with a resource approach with empirical evidence that original product creativity is a substantial intermediary variable to achieve sustainable competitive advantage. The practical implication of this research is that business actors in the palm oil stem waste industry must pay more attention to their knowledge resources and product innovation on indigenous product creativity.