UNDERSTANDING THE INFLUENCE OF ACEHNESE CULTURE ON MANAGING BUSINESS PERFORMANCE IN LHOKSEUMAWE

Abstract

Acehnese people held onto their tradition and culture in every part of their lives, including when conducting business. It influences the way they manage their business which results in an influence on their business performance. The business study also stated that religion is often associated with business as it greatly influences people's mindsets and choices (Hirschman, 1981). Small and medium enterprises numbers in Lhokseumawe are also high, considering the main livelihood is trade. People in Lhokseumawse City also respect and live their lives based on religion and norms. It is essential to understand the correlation between Acehnese cultural values and how it affects business players located in Lhokseumawe City upon managing business performance. It can be used to analyze whether the area is a good place for small and medium enterprises' investment and to understand the behavior pattern for business strategy.

The Acehnese sub-culture includes religion, norms, and work ethics. These three components of culture impacted owners of small and medium enterprises in Lhokseumawe through their habits, mindset, and view of life. Their belief influences the way they manage their business performance; based on the interview, most small and medium enterprises based their business on Islamic values, such as creating halal business on their ingredients which are halal from the production and process as well as implying Islamic values in doing business such as helping each other in need, tawakkal and ikhtiar. Norms in Aceh are also based on Shari'a law, but not too different than other parts of Indonesia, mainly the small and medium enterprise owners thought kinship is the most visible norm, especially among fellow people from the same kampong (village), helping others and treating other with kindness is also part of the norm, other than that honesty is also a must. Honesty will build trust among workers, a sense of belonging, and avoid internal issues; this leads to good business performance. As part of Acehnese cultural values, work ethics are also influenced by religion and norms. Responsible, working hard and giving their best to the job, continually learning in the process, disciplined, and not lazy. Creativity and innovation are also essential, especially for business planning, to be more fresh to compete in the market. Based on the analysis, only some small and medium enterprise owners pay attention to creativity and innovations. Creativity is essential, especially when they want to expand their business to other cities or other provinces. Creativity is part of business planning which is part of business management purposed to prepare for competition with other businesses. This is one reason why it is hard for Acehnese small and medium enterprises in Lhokseumawe to expand their business outside Aceh. Secondly, most small and medium enterprises in Aceh are owned by families from generation to generation and prioritize kinship and family ship among them; some of them do not plan for future expansion, which made their business stagnate, and they rarely expand to another region because profit is divided to fellow family. It is hard to combine minds. Some of them are also easily satisfied with their current business condition.

Future studies could explore more Acehnese cultural values concerning business performance with a larger informant scale to make the data obtained more accurate. A comparison study regarding Acehnese cultural influence in family-owned and non-family-owned small and medium enterprises would also be recommended to analyze the difference and how it influences business performance management.