THE CONTRIBUTION OF NON-FINANCIAL PERFORMANCE INDICATOR DIMENSION IN ASSESSING THE INFLUENCE OF SOCIAL CAPITAL ON BUSINESS PERFORMANCE IN SMES

This study aims to examine contribution of Non-Financial Performance Indicator (NFPI) to business performance and their effects on social capital of small and medium enterprises (SMEs) in embroidery and weaving craftsmanship in West Sumatra, Indonesia. This research was conducted in eight regions in West Sumatera with a total sample of 235 SMEs. All SMEs owners served as the informants for this study and whose responses to a questionnaire were used the data further analysed using SEM (Structural Equation Modelling) by means of AMOS software. This study found out that NFPI has the greater contribution in building SMEs' business performance as compared to other dimensions. Social capital variables have played positive and significant roles upon the business performance. Nevertheless, this study was disadvantaged from the lack of samples and the use of only quantitative method of analysis. Further studies can expected to fill in the gap by applying qualitative method to a larger size of samples from a variety of respondents, not only from SME owners.