Better Performance Prospect of Large-Medium Enterprises: The Role of Innovation

The Global Innovation Index (GII) of Indonesia ranks is far below other ASEAN countries. So, it is necessary to learn more about factors that determine innovation in Indonesia, especially the innovation of large-medium enterprises. This study observes the influences of innovations and indicators on the prospects of large-medium enterprises in Indonesia. It is also important to look at the characteristics of innovation types and indicators of innovation activities in Indonesia. The data processed in this study came from the micro-data of 312,080 large-medium enterprises resulting from the 2016 Census of Economic- Advanced Data Collection for Large-Medium Enterprises and Micro-Small Enterprises. This data collection was carried out by Statistics Indonesia in 2017 in 34 provinces in Indonesia. The method used to analyze the data was Logistic Regression. The result of the study shows that marketing innovations and product innovations are the most innovative types widely carried out by large-medium enterprises. Innovation and its determinants are varying in combination while influencing business prospects in all economic sectors. Variables that affect the entire economic sector are the variables of business development/ expansion preparation. While the sector that is influenced by all variables in this study is the manufacturing industry sector.