The Dynamic Capabilities And Organizational Culture Influence On The Competitive Advantage And Performance-Comparative Analysis Of Agriculture Cooperatives In Indonesia And China

Facing the 21 st century, agriculture cooperatives movement in Indonesia and China encounters great challenge due to the rapid change in global economy and open market competition. Many agricultural cooperatives are struggling to exist, some simply disappeared, but some shown their resistance and keep growing amid such changes. The growth cooperatives membership in China and Indonesia has led to a spacing of economic and business questions about how these cooperatives should be best organized and operated. One necessary question relating to cooperatives organization considering their rapid accretion in number and size is the appropriate sizing of cooperatives for long-run economic survival. Obtaining scale economies is an important economic consideration for China and Indonesia farmer cooperatives because doing so will result in greater long-run economic viability for these cooperatives in terms of their core economic competitiveness. Dynamic capabilities and organizational culture has a vital role in business operation in financial and non-financial aspect such as decision making as a big role of management. Some scholars believe that dynamic capabilities are the key to competitive advantage and firm performance. Aiming at the fact that, dynamic capabilities and organizational culture is particularly important to explore the problem of agriculture cooperatives in Indonesia and China.This paper aims at exploring contributions of dynamic capability and organizational culture in competitive advantage and performance of agriculture cooperatives in Indonesia and China.This study use structural equation model(PLS-SEM) and SPSS to explore a theoretical model which links various dynamic capabilities, organizational culture, competitive advantage and performance. Empirical evidence is provided by performing survey research with a large sample of 201 agriculture cooperatives in China and 241 agriculture cooperatives in Indonesia. This study finds that both dynamic capability and organizational culture of the cooperatives in China contribute significant and positive effect to their competitive advantage and performance as well. On the other hand, both dynamic capabilityies and organizational culture in the Indonesian cooperativesprovide positive effect solely to their competitive advantage; yet not for their performance which is in significantly affected by the dynamic capability.