Collaboration of Social Capital in Industrial Era 4.0 for Small and Medium Enterprises

Abstract

Politics, society, and culture are rarely associated with social capital for small and medium enterprises (SMEs). The focus of business enthusiasts is currently on large-scale businesses. Thus, SMEs hardly survive, while economic conditions are doomed. The resource-based theory states that a sustainable competitive advantage in a company will not strengthen strategic innovation by simply enhancing social capital.To maintain small businesses' sustainability, supporting social capital is necessary to accommodate all small businesses' interests in political, social, and cultural contexts, especially in the Balinese culture. Accordingly, this research aims to identify the extent to which Bali's politics, society, and culture can maintain SMEs' sustainability. In this study, ontic hermeneutics is used as the research method. Ontic hermeneutics is defined as seeing and understanding a phenomenon to develop a concept through political, social, and cultural approaches. Results have shown that SMEs tend to survive given that the government does not require excessive requirements. Micro-, small and medium enterprises (MSMEs) follow the government responsibly. MSMEs run their businesses with effort and flexibility. Thus, they can quickly adjust to the changes in the economy, desires, and tastes of the community's consumers and needs. Consequently, socio-economic and cultural conditions remain stable even if the political situationschange.