Strategic Ambidexterity and MSME Performance: The Conditional Role of Banking Credit in Eastern Indonesia

Micro, Small, and Medium Enterprises (MSMEs) serve as vital contributors to inclusive economic development, especially in emerging economies such as Indonesia. However, their strategic performance is often constrained by limited managerial capabilities and unequal access to formal banking credit. This study explores how strategic ambidexterity the balanced integration of exploitation and exploration strategies affects MSME performance in Eastern Indonesia, while examining the moderating role of banking credit access. Grounded in dynamic capability and contingency theories, this study surveyed 202 MSME owner/managers who had previously accessed formal banking loans. The data were analyzed using Partial Least Squares–Structural Equation Modeling (PLS-SEM) via SmartPLS. The results confirm that both exploitation and exploration significantly drive strategic ambidexterity, which in turn has a positive effect on MSME performance. However, the moderation analysis reveals a negative and significant interaction effect, indicating that banking credit, under certain conditions, may reduce rather than strengthen the benefits of ambidextrous strategies. This finding highlights a misalignment between credit mechanisms and MSME strategic execution. Theoretically, the study extends ambidexterity research into underdeveloped MSME ecosystems and introduces financial access as a boundary condition. Practically, the results call for banking institutions and policymakers to design more adaptive, strategy-aligned credit schemes to enhance MSME resilience and performance. Implications for theory and directions for future research are discussed.