Determinants of Business Performance of Village-Owned Enterprises (BUMDes) in Jembrana Regency, Bali

Efforts to develop the rural economy have long been carried out by the government through various programs, but these efforts have not produced satisfactory results. One of the ideas offered is the establishment of economic institutions such as Village-Owned Enterprises (BUMDes) which are supported by the role of the local government and are based on the wishes of the village community. This BUMDes is expected to be able to increase market demand based on proper management of the existing village potential. The performance of BUMDes businesses in Jembrana Regency is currently not able to play an optimal role because most are relatively newly formed. The role of the government is needed in enhancing the culture of entrepreneurship in the managers and management of BUMDes, in addition to strengthening the capacity of social capital managers. Through cooperative behavior (social capital), good synergy and entrepreneurial orientation in BUMDes managers and the positive role of the government it is hoped that there will be an increase in BUMDes business performance in Jembrana Regency.

One basis for multivariate analysis involving social variables (latent variables) will be obtained by the determinant of BUMDes business performance in Jembrana Regency, Bali. A comprehensive analysis of the role of government and social capital of business managers is needed through an entrepreneurial orientation to structurally determine the performance of BUMDes businesses in Jembrana Regency. Survey conducted on active BUMDes involved 90 respondents from BUMDes managers in Jembrana Regency. Respondent data processing results with four latent variables, obtained the following results; (1) social capital and the role of government directly have a positive but not significant effect on business performance, while entrepreneurial orientation has a positive and significant effect on business performance, (2) social capital and the role of government through mediating entrepreneurial orientation indirectly has a positive and significant effect on business performance, and (3) total social capital and the role of government have a positive and significant effect and require full mediation through entrepreneurial orientation towards BUMDes business performance in Jembrana Regency, Bali.

Based on the results of the structural analysis of BUMDes business performance in Jembrana Regency, it is recommended: 1) the social capital capacity of BUMDes managers according to the survey results is actually high though not significant, so this needs to be empowered so that it can play a role in improving the entrepreneurial culture and BUMDes business performance, and 2) the role local government, especially the Community Empowerment Service (PMD) of Jembrana Regency needs to be improved continuously through training facilities for BUMDes managers and capitals to improve the entrepreneurial culture of BUMDes managers in Jembrana Regency, Bali.