| dc.description.abstract | SMEs have an important role as the backbone of the economy in Indonesia. SMEs contribute significantly to the GDP, which amounts approximately to 60 percent and the number of workers absorbed by the sector stood at 97 percent of the total available workforce. However, there are several challenges faced by the SMEs in developing countries, such as sourcing financial capital, human resource competency and technology adoption. The majority of SMEs in Indonesia still apply traditional practices in terms of production processes and marketing, which indicates the low level of technology adopted. This condition is also observed in the Indonesia dairy sector. Pangalengan is a sub-district of Bandung Regency that serves as the centre of milk production in West Java. There are many establishments of SMEs of dairy products producing milk caramel, milk nougat, milk dodol, and milk crackers. Initially, the smallholder dairy farmers’ motivation was to utilize the fresh milk that could not be absorbed by the milk processing plant due to quality issues. Most of dairy SMEs in Pangalengan were lack of technology adoption and GMP implementation, with resulting inconsistency in the quality of the product and limited area of product distribution. This has resulted in the product’s low marketability when compared with the milk candy found in the national market which consists of mainly imported products. This study intends to explore the conditions and the problems of the production and quality of the product faced by the Small Medium Enterprises (SMEs) of dairy products in Pangalengan-Bandung Regency and to propose the technology that might be accepted and adopted to address the problem in the framework of Good Manufacturing Practices (GMP). The outputs of this study are recommendations on the technology adoption to improve the quality of the products and identification of factors that may influence the adoption of technology innovation by the dairy SMEs. The conceptual frameworks that are used in this study consist of Good Manufacturing Practices (GMP) and the perceivable attributes of innovation in the theory of innovation adoption by Rogers (2003). This research takes the form of an exploratory case study because it aims to explore the condition of SMEs of dairy products in Pangalengan-Bandung Regency with the conceptual framework of Good Manufacturing Practices and technology innovation adoption theory. The data were collected by doing literature study, field observations in the SMEs of dairy products and conducting interviews with the five respondents. This research recommends the technology adoption that might be acceptable and adopted by the dairy SMEs to address the problem as follow: (1) Establishing a process control system. A Process control system for the SMEs can be achieved by establishing: the raw material specification, the raw material composition and formulation, SOP of production process, SOP of personal hygiene and SOP of sanitation; (2) Introduction of processing machinery for key processing stage, such as manual mixing to be replaced by the mechanically operated mixer, moulding and cutting machines, and the use of boiling pans equipped with the thermocouple; (3) Improvement of the product’s packaging to enhance protection of the product thus will extend the shelf life. It is suggested to modify the secondary packaging using standing pouch aluminium foil. Factors that may influence the adoption of technology by the SMEs have been identified. The positive factors are the motivation and efforts to improve the quality and performance of the product; consumers’ demand for quality and good manufacturing practices; government or regulatory enforcement; and increasing production volumes. The negative factors are limited knowledge and educational background of the SMEs’ human resources; the reluctance of the SMEs to change their current traditional practices; and financial cost. This study also evaluates the perceived attributes of innovation / technology of GMP. The SMEs perceived that the relative advantage of GMP implementation is low due to the cost that arises as a result of facilities and equipment improvement. Implementation of GMP and the new technology embodied in it are perceived as complicated by the SMEs. This is caused by their limited knowledge of the concept of GMP and the new technology itself. However, the SMEs perceived that GMP implementation is compatible with their values, needs, consumer’s demand, and government regulatory. | id |
