OPERATIONAL PERFORMANCE OF SME: THE IMPACT OF ENTREPRENEURIAL LEADERSHIP, GOOD GOVERNANCE AND BUSINESS PROCESS MANAGEMENT

Abstract

The purpose of this study is examines the impact of entrepreneurial leadership and good governance of the entrepreneurs to the operational performance through business process management. The object of this research is SME of Batik product, one of the fastest growing SME in Indonesia. The method of this study is explanatory research, analyze the relationship of entrepreneur leadership, good governance to operational performance and business process management as an intermediate variable. This research conducted in 67 batik entrepreneurs in the center of batik industry in Surabaya and surrounding. The results indicated that entrepreneurial leadership and good governance affect business process management and operational performance. Finding revealed that business process management has no direct impact on operating performance. Based on these findings, concluded that it is important for entrepreneurs to develop entrepreneurial leadership and build a good governance as well in managing their business.