Developing a Green Innovation Model to Improve MSME Performance in Supporting the Tourism Ecosystem in East Sumba Regency

Tourism Micro, Small, and Medium Enterprises (MSMEs) in underdeveloped regions play a crucial role in driving local economic development and sustaining the tourism ecosystem. Yet they face limitations in innovation capacity and organizational performance. This study aims to develop and test a green innovation model to improve MSME organizational performance and strengthen the tourism ecosystem in East Sumba Regency, Indonesia. This study employed a quantitative approach, collecting data through questionnaires from tourism MSMEs, which were analyzed using Partial Least Squares–Structural Equation Modeling (PLS-SEM). The results indicate that green innovation, represented by product value, technology, networking, marketing, and market demand, is positively and significantly associated with organizational performance, which, in turn, is positively associated with perceived ecosystem performance, as reflected in productivity and resilience. These findings support the view that the relationship between green innovation and perceived tourism ecosystem performance operates indirectly and is dependent on strengthening the operational and financial performance of MSMEs. The novelty of this study lies in integrating the empirical PLS-SEM model with an implementation approach, including the development of training modules and the digitalization of learning, in the context of 3T regions (Frontier, Outermost, and Underdeveloped). The limitations of this study include the use of data from a single time period; further research is recommended to use multi-period data to capture the dynamics of change better.