Kesan orientasi perniagaan terhadap prestasi perniagaan Perusahaan Kecil dan Sederhana (PKS) di Malaysia: Peranan etika Islam sebagai perantara

Small and medium enterprises (SMEs) are crucial to the country's economy as they provide employment opportunities, strengthen the local community's economy, and promote the local market. However, minimal studies have examined the relationship between business orientation, Islamic ethics, and the business performance of SMEs, especially in Malaysia, a developing nation. This study aims to examine the relationship between business orientation (i.e., coordination between internal, consumers, and competitors) and SMEs’ performance. The mediating role of Islamic ethics in this relationship is also investigated. A survey of 535 Muslim SMEs (Bumiputera) in Johor, Perak, Selangor, and Kelantan in Malaysia was analyzed using the partial least squares-structural equation modeling (PLS-SEM) approach via SmartPLS 3.0 approach. The results reveal a positive and significant relationship between business orientation and SMEs’ performance. SME entrepreneurs are keen to improve their business orientation to achieve better performance, strengthen them for the continuity of the business sector, and close the gap with minimal disadvantages. Moreover, Islamic ethics was a significant mediator in the relationship between business orientation and SMEs’ performance. The result has shown a significant result that the stronger Islamic ethics practice by the SME’s, the better its performance will be. SME entrepreneurs should incorporate Islamic ethics into their business orientation to improve their business decisions, productivity, and performance. The empirical results (direct effect and mediating effect) provide new insights into the academic perspective regarding the relationships between business orientation, Islamic ethics, and SME performance in a single framework using resource-based view theory (RBV) as an underpinning theory.