Competency Development Strategies for MSMEs: Driving Performance Improvement in Makassar

Abstract

The Micro, Small, and Medium Enterprises (MSMEs) sector has been vital to Indonesia's economy since 1995, significantly contributing to GDP, employment, and investment. Despite these contributions, MSMEs in Indonesia, particularly in Makassar, face challenges in global competitiveness. This study investigates competency development strategies to enhance MSME performance in Makassar. A qualitative research design with a descriptive phenomenological approach was employed, focusing on three stages of competency development: pre-incubation, incubation, and acceleration. Data were collected through observations, in-depth interviews, and documentation, involving key informants from the Makassar City Cooperative and MSME Office, the MSME incubator center, and MSME business owners. Findings indicate that the structured approach of competency development significantly impacts MSME performance. During the incubation stage, business owners undergo specific technical skills training in five main areas: product quality, human resource management, financial management, customer service, and digital marketing. These training programs are tailored to address the identified strengths and weaknesses of each MSME. The acceleration stage focuses on applying acquired skills in real-world scenarios with advanced mentorship and support, leading to improvements in product quality, management practices, financial stability, customer satisfaction, and digital presence. However, the study identifies limitations, such as varying levels of baseline competency among MSME owners and potential bias in self-reported data. Future research should incorporate larger, more diverse samples and employ quantitative methods to validate findings. Longitudinal studies could provide deeper insights into the long-term impacts of these strategies. This research highlights the importance of targeted competency development programs in enhancing the competitiveness and sustainability of MSMEs in Makassar.