Strategies for SME Digital Ecosystem in Indonesian Metal Industry

SMEs can achieve the paradigm shift they need for development by creating a business ecosystem that will improve their skills and technicalities through digital media. This study aims to identify several strategies that can influence changes in the digital ecosystem development for SMEs in Indonesia to help them survive and be sustainable. This research focuses on a single case study approach. Citeureup metal industry centre was chosen by involving 70 SMEs spread across the Citeureup area. This study found that four strategies can be applied to develop a digital ecosystem. The first is helping SMEs to level up, and the second is connecting with the surrounding stakeholders. The third is to help SMEs expand their market, and the last is to help them build regeneration strategies.

Finally, in 2020, the E-smart SMEs program is expected to serve as a digital ecosystem that provides information that can help identify potential SMEs to be coached. It is one of the SME digital ecosystems that was successfully developed by the Ministry of Industry in collaboration with the Dharma Bhakti Astra Foundation (YDBA) from 2017 to 2019. Therefore, the researchers chose a digital ecosystem within the centre, with the UKM Citeureup serving as a case to be investigated.
The SME E-Smart program in Citeureup presents a best practice from the successful and sustainable development of the SME digital ecosystem in Indonesia, which occurs due to the collaboration of many stakeholders, namely local governments, ministries, large industries, and SMEs.
Findings from Wang (2020) suggested that digital and entrepreneurial knowledge owned by SMEs could be an asset in facing the competition.
Furthermore, Ghobakhloo and Iranmanesh (2021) identified valuable factors for a business when they are in the phase of digital transformation.
Olsson and Bernhard (2020) argued that human resources in the industry are needed to be prepared by the entrepreneur and their employees. Digital transformation is currently happening in the SME ecosystem globally, not only in Indonesia, but very little literature that discusses how this entrepreneurial ecosystem is formed, especially regarding the digital ecosystem in Indonesia. Very few also discuss how the strategy is needed to build this digital ecosystem. This recent research will look closer into Citeureup metal industries on how the framework required for SME smooth climb into the digital business world. With this study, we hope to contribute to the stakeholders involved in preparing SMEs to enter the digital ecosystem. Tambunan (2008) argued the need for a change in the paradigm to develop SMEs in Indonesia. The focus now is to provide the support needed to SMEs to gain skills and receive technical upgrades. These aspects were believed to bring in better capital, help SMEs increase their competitiveness, and enable them to reach their potential to become bigger businesses. Furthermore, he argued that SMEs should aim to support more significant business (through business-to-business sales) and expand their sales into different countries through exporting. Cavusgil, Knight, and Riesenberger (2014) Reynolds (1997) stated that economic growth could also be achieved through a clustered industry. At least this policy would benefit the economic growth in specific regions. He added that such an industrial district must have 1) populated business activities in an area, 2) focus on a specific industry area, 3) set a division of production phases among small businesses in the area, 4) establish cooperation between businesses in the area, and 5) support industrial local culture and values.

SMEs Digital Ecosystem
Hertanti (2017) Wang (2020) argued that small firms with solid digital capabilities (plus good entrepreneurial orientation) could perform as well as their medium counterparts. Bouwman, Reuver, and Nikou (2017) stated that social media and big data in business model innovation (BMI) substantially impact business performance. They found that the decision to utilise social media and big data comes from the internal motives of the business (managers and toplevel executives). It is argued that a firm's website presence and quality positively impact business competitiveness (Lányi, Hornyák, & Kruzslicz, 2021;Westerlund, 2020). They also stated that a website could be categorised as a competitive marketing tool (rather than an information technology tool). (2021) Porter (1985) believed that a business strategy emerged due to external and internal forces that affected the company. That eventually gave the company a competitive edge and will bring benefits to its investment. Barney (1991) added that a firm's strategy is a unique resource and knowledge combined from a resource-based view of the firm.

Business Strategy
Including e-business, knowledge is seen as a valuable asset and an advantage in winning the competition (Bharadwaj, 2000). Therefore, the Internet is suggested (Porter, 2001) as an opportunity to utilise it as a competitive force and strategic decision.
Johnson, Scholes, and Whittington (2009) stated that one of the characteristics of a strategic decision is acknowledging relationships and networks built with the organisations. According to Indarti and Langenberg (2004), those relationships were marketing, technology, and capital access. They believed that they were crucial in success, especially for an SME business. Marketing variables include creating new products, maintaining a significant portion of loyal customers, and providing customers with superior value products. In technology, they believe that this variable will provide SMEs with a competitive edge in finding effective and efficient means of the business process. Hence, adapting to technological change will benefit the business. Raymond and Bergeron (2008) argued that the change would include the decision on technology being used, any challenges arising from such implementation, training consequences, and any updates that the technology required. One way of evaluating it is through comparing the cost and the benefit of using an e-business (Cutler & Sterne, 2001). Waldt and Drumond (2002) observed that the adoption of e-business in SMEs is slow. Some SMEs even showed hesitation in using electronic information standards and internet technology.
While in more prominent companies, this intranet and internet utilisation has become that daily inseparable operation. Loforte Robeiro and Love (2003) suggested that e-business is a condition where economic value creation meets IT (information technology) and brings connectivity for the entire organisation. Therefore an e-business policy is a strategic advantage one company must pursue (Hackbarth & Kettinger, 2000;Chang et al., 2003;Azumah et al., 2007). Furthermore, the combination of e-business and business strategy is found to be the basis of better business performance (Chan & Reich, 2007).

Case Selection
Our qualitative research is embedded in the and constructive information about business in the area (Creswell, 2013). The informants were chosen because they handled the business by themselves from the beginning. Therefore, possessing a good knowledge on business development and its history.
Plus, they were selected based on their availability, willingness to be interviewed, and the variety of metal products produced. This single case study was chosen because, although case studies can indeed be used for exploratory purposes (Snyder, 2012;Yin, 2014), this approach can also be used for descriptive purposes and to test the explanations for why certain events have occurred and are used to make causal inferences (Yin, 1981;Ragin, 2001). By identifying strategies that are useful for developing a digital ecosystem for SMEs, the researchers can also provide the basis necessary for the E-Smart SME program to be successful and help more SMEs join this program.

Data Collection
In the case of study research, many consider selecting topics based on a set of particular standards to be a vital step (Siggelkow, 2007;Veldman et al., 2011). Therefore, the criteria for selecting the companies to be studied are based  Table 1.
Other than being classified based on their production, SMEs are also classified based on their production capacity, as shown in Table 2. The production capacity is classified into three categories: (1) Small enterprises, which are businesses with a production capacity lower than 10,000 pieces; (2) Medium enterprises, which have a production capacity between 10,000 and 100,000 pieces; and (3) large enterprises whose businesses have a production capacity larger than 100,000 pieces.  Due to the diversity of sources both through observation and in-depth interviews, data collection must be guided by several types of protocols. Such a protocol identifies the topic to be studied and reminds researchers of the types of evidence that may be relevant (Denzin & Lincoln, 2000;Silverman, 2013). Therefore, interviews were conducted using the semi-structured interview method, in which key questions were prepared (Tellis, 1997;Adams, 2015), and observations were made using the systematic observation method (Nisbett & Wilson, 1977). This observation is carried out with full planning and preparation in advance, during which process the researcher will load statements containing the formulation of the problem of the activity to be studied (Anguera, 2003;Portell et al., 2015). The following are essential questions that will be discussed during the data collection process: 1. What is the strategy for SMEs to be able to move up in class?
2. How is the collaboration level between SMEs and YDBA?
3. What is the strategy for SMEs to expand the market?
4. What is the SME strategy for business regeneration?

Data Analysis
The results of in-depth interviews were digitally recorded, and then transcripts were created and distributed evenly to researchers (Krueger, 1998).
Then the researcher began processing interview and observation data and identified the topics and themes that appear in the transcription, which were then mapped with an effective data coding system (Gibson & Brown, 2009). To facilitate data management and analysis, the researchers used the NVIVO computer program. After the case study narrative was generated, the researcher asked the respondents to review the substantial part of the case study. This is a minimal procedure to validate the data collection process and is part of data triangulation (Schatzman & Strauss, 1973;Cobb & Hagemaster, 1987;Patton, 1999;Denzin, 2018). For example, although the respondents might disagree with the interpretation in a case study, they should not find that basic facts have been misinterpreted (Snyder, 2012).

Scale-Up Strategy
Classification of SME is based on production capacity, divided into three categories: large, medium, and small enterprises, as shown in Table   2. For SMEs to step up to a higher business level, they need to apply these four strategies. First, they need to concentrate on the production of certain  Table 3.
Compliances with existing rules and regulations are believed to be an important condition that needs to be present for ensuring a successful business (Mazzarol & Choo, 2003). However, in Indonesia, the story is somewhat different.

Name Production type Production Capacity Company Type Number of Workers
Afdan Production Serpo N-Max 4800 Individual 12 Bracket number plat. 9600 Seat N-Max 4800 Table 3. Afdan Production Capacity Indarti and Langenberg (2004) and Duh (2003) believed that legal requirements tend to obstruct business growth. Due to the fact that such compliances require particular financial resources.
Therefore, they suggested that legal requirements simplification and further deregulation can propel business growth.

Collaboration with YDBA
Yayasan Dharma Bhakti Astra (YDBA) selected Tarikolot as their 16 th featured area to develop, especially in the metal products sector. Given their existing programs in developing the industry, it is suggested that this SME complement this development with supporting programs shown in Table 4. For instance, they could help to map the talents available in the area and offer consultation and guidance in management and innovation to the SMEs (that are not performed by YDBA).

Findings based on interviews with one business
owner support developing a business based on the owner's talent. For example, a business owner has excellent knowledge in production techniques.
However, his expertise in marketing is not as strong.
As another business owner claimed:  2004). In addition, the participation of SMEs in the business network built by YDBA allows them to find innovative ways to create products or services that are better than other SMEs that move on their own (Nasution et al., 2011).

Market Expansion
In expanding the market, an SME can accomplish A market expansion strategy can be used to reach a successful business. This finding is in accordance with Indarti and Langenberg (2004) research. They suggested that focusing on grabbing opportunities in the market area, creating valuable new products, and safeguarding repeating customers will bring business growth. In Indonesia, most SMEs operate along traditional lines in marketing. Stiffer competition in the market should be responded to proactively by SMEs by doing market development. Access to the market was a problem faced by SMEs (Mead & Liedholm, 1998;Swierczek & Ha, 2003). Market development is, therefore, crucial for preserving high growth in the business. In their study in the UK, Smallbone, Leig, and North (1995) found that the vast majority of the high growth SMEs had identified and responded to new market opportunities.
In completing the expansion, as Anderson and Narus (1998) suggested, a business must understand their customers, particularly knowing the five factors that customers consider when they navigate the decision process. First is the business reputation; a good reputation can be built through these two methods: (a) By offering a new product line. This move shows that a business is serious about continuing to meet evolving consumer needs. One business owner already did this, saying: "We also served buyers who came to us with their product design" (Participant #12).
(b) By setting up an E-commerce store. By doing so, the store shows that it is also present in the online world. Therefore, opening an e-commerce store and maintaining it effectively is a good move, as mentioned by one of the business owners based on his experience: "I want to try to sell through the online platform.
We have a store in Bukalapak. I have tried using

Facebook and Instagram" (Participant #13).
The second factor is after-sales service. It is generally known that businesses must stay connected with their consumers' after-sales transactions. Given the opportunity available from recent technology, the connection can now be made online through social media (Bouwman et al., 2017). Therefore, creating a position and training a media admin is an important task. This is because consumers can have a direct and personalised channel to reach and interact with the business. Many SME owners have a good understanding of this concept. One business owner claimed: " A c c o u n t i n g t r a i n i n g , m e c h a n i c a l engineering, and any business-related engineering training will be beneficial" At the same time, Indarti and Langenberg (2004) suggested utilisation of technology in their business process, for example, social media usage in marketing communication and computer software application in assisting daily operation will certainly bring better use of the business' resources. This finding supports a previous study that has revealed that lack of equipment and outdated technology are among hindrances of SME development (Swierczek & Ha, 2003). In their study in the US, Gundry, Kickul, Welsch, and Posig (2003) disclosed that technological change innovations had a significant relationship with market growth.

Business Regeneration
Strong regeneration is essential in a business, especially in the case of metalworking SMEs in Citeureup. It is believed that it will provide a sustainable base for the business. This insight from one local business owner included the concern that regeneration is essential for their business sustainability. The findings of this study add to our understanding of a succession process in an SME. The previous study conducted by Michel and Kammerlander (2015) states that for regeneration to be successful (outweigh the cost of doing it), then a good relation between the existing business owner, the successor and the advisors/mentors should be present.
Therefore the writer believed that Regeneration could be realised through a mentoring program.  (Beckhard and Dyer, 1983;Dyer, 1986), and only 10% to 15% survive into the third generation (Applegate & Feldman, 1994).
Therefore, to understand succession in the family business, we need to approach the process rather than events (Handler, 1994

CONCLUSION
To support the success of the SME E-smart program, the following four strategies can be implemented for the metal SMEs in Citeureup. The first would be the level-up scheme, in which businesses are encouraged to refocus their production and achieve economies of scale. Second, to complement this, companies should obtain the necessary permits and legalities in order to target the business-tobusiness market. To help with scaling up, the third strategy would be the expansion of the market. This means that the company should expand its market reach to other customer bases, such as organisations, customers from different industries, or even customers from other areas. Furthermore, the provision of after-sales service would be pivotal in increasing the customer retention rate through guaranteed shipping and regular maintenance. Additionally, the company can improve its product quality and increase the efficiency and effectiveness of its production process.
The fourth strategy would be a regeneration strategy.

Conflict of interest
There is no conflict of interest between the researcher and the Ministry of Industry Indonesia and also Business Venture Development Institute (BVDI) Universitas Prasetiya Mulya regarding the method or outcome of this research.