The Role of Innovation Leadership in Boosting MSMEs Competitiveness in Southeast Asia

Abstract

MSMEs (Micro, Small, and Medium Enterprises) are the backbone of the economy in the Southeast Asian region, but still face challenges in maintaining competitiveness amid digital disruption and globalization. Innovative leadership is recognized as one of the key factors in driving the strategic transformation of MSMEs towards an adaptive and sustainable business model. This study aims to explore how innovative leadership practices are implemented by MSME actors in five ASEAN countries, and to identify the factors that support and hinder their efforts to increase competitiveness. The approach used was qualitatively exploratory, with data collection through in-depth interviews with 25 MSME actors from Indonesia, Malaysia, Thailand, Vietnam, and the Philippines. The data analysis technique employed a thematic analysis approach, as outlined by Braun & Clarke. The results indicate that local cultural contexts have a significant influence on innovative leadership practices, access to digital technologies, and collaborative capacity with stakeholders. In addition, barriers such as limited resources, organizational cultural conservatism, and access to training are also significant challenges. The study concludes that successful innovative leadership synergizes local value-based strategies with digital adoption and cross-sectoral strategic partnerships. These findings make an essential contribution to the development of policy frameworks and innovative leadership training for MSMEs in Southeast Asia.