Technology Diffusion Challenges for Micro, Small and Medium Enterprises (MSMEs) in Developing Countries: Case Study of the Appropriate Technology for MSMEs Program (Iptekda) in West Java-Indonesia (The paper is part of a Dissertation...


Micro, Small and Medium Enterprises (MSMEs) have been known for their contribution to increase employment rate in developing economies such as Indonesia. With regard to this, the Indonesian Government launched many programs to empower MSMEs. One of these programs, called Appropriate Technology for MSMEs Program-called Iptekda LIPI, has been implemented since 1998; however, owing to the low productivity and limited competitiveness of MSMEs this program has not been successful. The aim of the study is to examine the barriers of MSMEs’ competitiveness from the perspective of the technology diffusion policy in Indonesia. The research will address two questions: (1) what are the challenges faced by MSMEs in applying technology for their business, and (2) what are the strategies for improving technology diffusion that will result in MSMEs’ success? To answer such questions, this paper will apply the case study of six MSMEs in West Java. The research will apply a qualitative approach using in-depth interviews with six owners of MSMEs in a research context. The findings of the research indicate that the challenges of the program are closely intertwined with the interest and responsiveness of the change agent and the owners of MSMEs. The study recommends a bottom-up approach to technology diffusion for MSMEs and provides a model of MSMEs’ empowerment through the diffusion of technology mechanism.



Keywords: Appropriate Technology, Technology Diffusion Policy, MSMEs, Iptekda, Developing Country

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