Exploring the Role of IoT in Enhancing Product Innovation and Firm Performance in Indonesia

Abstract

This study examines how technology implementation and knowledge management enhance product innovation and firm performance in Indonesian SMEs. Drawing from the Technology-Organization-Environment (TOE) framework and the Resource-Based View (RBV) theory, the research explores how digital technologies and knowledge management practices influence innovation and organizational success. Using qualitative methods, data was collected through interviews, observations, and document analysis from senior managers in various Indonesian SMEs. The findings show that adopting digital technologies and systematic knowledge management drives product innovation, which subsequently improves firm performance. Both technology implementation and knowledge management directly impact organizational outcomes, underscoring the importance of leveraging digital capabilities and knowledge-sharing mechanisms. These factors contribute to long-term competitiveness and sustainable growth.   This study offers valuable insights for business leaders, policymakers, and researchers interested in digital transformation, innovation, and knowledge management in emerging economies. It highlights how Indonesian SMEs can use these elements to boost growth, enhance market position, and contribute to broader discussions on innovation management and organizational performance in the digital age.