BUILDING RELATIONAL LEADERSHIP CAPABILITY IN FOOD MSMES: THE ROLE OF ENTREPRENEURIAL AND ADAPTIVE CAPABILITIES

Eka Nurjati; Septian Adityawati

Authors

Eka Nurjati Badan Riset dan Inovasi Nasional (BRIN) Author
Septian Adityawati National Research and Innovation Agency Author

Abstract

This study explores relational leadership capability within the broader context of socio-economics and business transformation in tropical bioresources, focusing on food-sector Micro, Small, and Medium Enterprises (MSMEs). In emerging economies, food MSMEs play a strategic role in utilizing local bioresources while supporting employment and inclusive growth. However, increasing market volatility, shifting consumer preferences, and sustainability pressures require entrepreneurs to develop capabilities that enable both economic resilience and business transformation. Drawing on the dynamic capabilities perspective, this study examines how entrepreneurial capability contributes to relational leadership capability, with adaptive capability as a key mediating mechanism. Using a quantitative approach, data were collected from 1,161 food MSME owners and managers across four provinces in Indonesia and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results indicate that entrepreneurial capability significantly enhances adaptive capability, which in turn strengthens relational leadership capability. Although entrepreneurial capability also has a direct effect on relational leadership, its indirect effect through adaptive capability is stronger, confirming partial mediation. These findings highlight that adaptive capability is essential in translating entrepreneurial competencies into effective relational leadership, particularly in bioresource-based sectors where collaboration, trust, and responsiveness are critical. The study contributes to the literature by linking entrepreneurship, leadership, and business transformation within the socio-economic context of tropical bioresources. From a policy perspective, the results suggest the need for integrated capacity-building programs that combine entrepreneurial development with adaptive and relational skills to support sustainable transformation and value chain upgrading in food MSMEs.