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How Indonesian Sme Garment Manufacturers Survive?

Author

Listed:
  • AGUS GUNAWAN

    () (TiCC, Tilburg University, The Netherlands)

  • MOHAMED A. WAHDAN

    () (Faculty of Commerce, Menoufia University, Menoufia, Egypt)

  • H. JAAP VAN DEN HERIK

    () (TiCC, Tilburg University, The Netherlands)

  • ASDI ATHURI AULIA

    () (Faculty of Economics, Parahyangan Catholic University (UNPAR), Bandung, Indonesia)

  • CATHARINA TAN LIAN SOEI

    () (Faculty of Economics, Parahyangan Catholic University (UNPAR), Bandung, Indonesia)

Abstract

In this paper we analyse the Information Technology (IT) support of the Indonesian SME Garment Manufacturers (ISGMs). We address three research questions: (1) to what extent should the ISGM managers be supported by information technology? (2) how do Indonesian financial experts analyse the performance of the ISGMs? and (3) how can a hybrid knowledge-intensive system (KIS) support the managers? To answer these questions we followed a research methodology that consists of three stages, viz. literature review, fieldwork (surveys and case studies), and analysis of the results. The findings of the study indicate that most of the ISGM do not follow accounting standards while monitoring and evaluating the financial statements. This issue is particularly relevant since most ISGMs want to communicate to external parties such as a bank and a supplier that they are in good health and have fair prospects. The findings of the study indicate that the ISGM managers need the support of financial experts in analysing their financial statements for monitoring and evaluating purposes. However, because of their unique characteristics, the ISGM owners struggle with the question how to analyse and interpret the performance of an ISGM. In the paper we consider the use of a hybrid KIS that consists of an Accounting Information System (AIS) and a Decision Support System (DSS). We conjecture that in the long run ISGMs will follow the accounting standards and harmonize the provision of accounting information in financial statements. Using a hybrid KIS, ISGM managers will be able to learn how to evaluate and monitor their companies’ performances, especially in using financial analysis methods and in obtaining the insight into their own companies.

Suggested Citation

  • Agus Gunawan & Mohamed A. Wahdan & H. Jaap Van Den Herik & Asdi Athuri Aulia & Catharina Tan Lian Soei, 2011. "How Indonesian Sme Garment Manufacturers Survive?," JOURNAL STUDIA UNIVERSITATIS BABES-BOLYAI NEGOTIA, Babes-Bolyai University, Faculty of Business.
  • Handle: RePEc:bbn:journl:2011_4_8_gunawan
    as

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    File URL: http://tbs.ubbcluj.ro/RePEc/bbn/journl/Negotia_4_2011.pdf
    File Function: Revised version, 2011
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    References listed on IDEAS

    as
    1. Tulus Tambunan, 2009. "Export-oriented small and medium industry clusters in Indonesia," Journal of Enterprising Communities: People and Places in the Global Economy, Emerald Group Publishing, vol. 3(1), pages 25-58, March.
    2. Agus Gunawan & Mohamed Wahdan & H. Jaap Van Den Herik, 2010. "Increasing the managerial capabilities in Indonesian garment manufacturing," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 3(4), pages 346-367.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    financial analysis; hybrid knowledge-intensive system; accounting information system; decision support system; Indonesian SMEs garment manufacturers;

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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