Integrating Intellectual Capital and Entrepreneurship Ecosystems to Enhance Community-Based MSMEs Performance: A Soft Systems Methodology Approach

Abstract

Micro, small, and medium enterprises (MSMEs) are essential contributors to economic resilience and inclusive growth in emerging markets. However, community-based MSMEs often face systemic challenges such as limited access to finance, fragmented markets, and regulatory complexity. While intellectual capital and entrepreneurship ecosystem have been widely recognized as innovation drivers, their structured integration remains underdeveloped in practice.This study proposes a systemic business performance model that integrates intellectual capital and entrepreneurship ecosystem components through Soft Systems Methodology (SSM). Using stakeholder mapping, in-depth interviews, and system modeling, the study uncovers interrelated drivers, barriers, and intervention points in four community-based MSME clusters in Indonesia. Triangulation through expert validation, document analysis, and member checking enhances the study’s rigor and credibility. Findings highlight digital adoption, financial literacy, and cross-sectoral partnerships as critical to MSMEs sustainability. The resulting model underscores participatory governance, inclusive finance, and adaptive policy as enablers of resilience. By contextualizing open innovation within MSMEs ecosystems, this research contributes a holistic framework that is applicable across similar emerging economies. Policy recommendations include incentives for digital transformation, support for ecosystem collaborations, and interventions tailored to local entrepreneurial dynamics.