Technology Adoption Issues and Challenges for Micro, Small and Medium Enterprises: A Case Study of the Food and Beverage Sub-Sector in Indonesia*

MSMEs in the food and beverage industry play a critical role in the Indonesian economy since they account for the majority of the manufacturing sector’s GDP. Despite its importance, it is unable to compete on a worldwide scale due to a lack of technological adoption. As a result, the purpose of this study is to look into the concerns and challenges that F&B MSMEs have when it comes to technology adoption. An online survey of 626 MSMEs and in-depth interviews as well as focus groups with diverse stakeholders from four provinces, namely West Java, East Java, South Sulawesi, and North Sumatera, provided the data for this study. To be thorough, the approach used in the study is based on the Technology, Organization, and Environment (TOE) framework. According to the findings, the majority of MSMEs use technology for marketing and sales, mainly through e-commerce. Meanwhile, for a variety of reasons, most of them continue to rely on traditional and semi-automatic technologies for production. According to the TOE framework, MSMEs lack those three parts of the technology adoption framework, particularly the environmental aspect, which is mostly due to a lack of cooperation among stakeholders. Finally, as a policy proposal, we offer a comprehensive technology adoption strategy based on the findings through an integrated MSMEs development information system including many important stakeholders.