Innovation Ambidexterity and Digital Capability as Drivers of SMEs’ Sustainability

This research contributes to supporting Balinese endek weaving SMEs in their efforts to achieve sustainability. This study examines the role of innovation ambidexterity and green digital innovation capability in increasing the influence of sustainable entrepreneurial leadership to achieve business sustainability. The existence of SMEs is essential to the country’s economy. The role of SMEs is also very massive as a contributor to gross domestic income and creating job opportunities. Data from the Indonesian Chamber of Commerce and Industry states that SMEs contribute 61% of Indonesia’s Gross Domestic Product or equivalent to IDR 9,580 trillion in 2023. The goal of this study is to provide theoretical clarification on the direct and indirect effects of sustainable entrepreneurial leadership on business sustainability through a research model. This research was conducted on endek weaving SMEs in Bali Province. The research population is the management of Balinese endek weaving SMEs with a sample size of 99 leaders and managers determined based on proportional random sampling techniques. A survey via questionnaire was used to obtain data and the PLS-SEM method was used to analyze research data with SmartPLS 3 software which went through 3 stages. Outer model analysis was conducted to test the validity and reliability of the instrument. Measuring the inner model to determine the accuracy of the research model. And the last stage is testing the research hypothesis. The study suggests a strong link between business sustainability and sustainable entrepreneurial leadership. The relationship between sustainable entrepreneurial leadership and business sustainability is strengthened by innovation ambidexterity and green digital innovation capabilities. The results of this research are the basis for leaders of Balinese endek weaving SMEs to hone their sharpness in decision-making and improve their leadership abilities so that optimal performance and business sustainability of Balinese endek weaving SMEs can be achieved.