Resilience of Modest Fashion Industry Development through Strategic Innovation, HRM, and Competitive Advantage Enhancement
DOI:
https://doi.org/10.21580/jdmhi.2026.8.1.29394Abstract
This study examines the relationship between Strategic Innovation Quality and Human Resource Management (HRM) Approach toward Competitive Advantage and their implications for the Sustainable Development of the Modest Muslim Fashion Industry in Central Java, Indonesia. Using a quantitative explanatory method, data were collected from 360 respondents representing Muslim fashion SMEs across various districts. The analytical technique employed was Structural Equation Modeling–Partial Least Squares (SEM–PLS) to test the structural relationships among variables.The results indicate that Strategic Innovation Quality has a positive but insignificant effect on Competitive Advantage, suggesting that innovation alone does not directly enhance competitiveness without strong managerial and HR support. Conversely, the HRM Approach shows a significant positive influence on both Competitive Advantage and Sustainable Development, emphasizing the critical role of human capital alignment in sustaining organizational growth. Furthermore, Competitive Advantage significantly contributes to Sustainable Development within the modest Muslim fashion industry. However, the mediating role of Competitive Advantage between Strategic Innovation Quality and Sustainable Development was not supported, indicating that innovation strategies may influence sustainability through alternative pathways rather than through competitiveness alone.These findings enrich the literature on Islamic creative industry management by providing empirical evidence from Central Java. The study highlights the necessity of integrating HRM-based capabilities with innovation strategies to achieve long-term sustainability and resilience in the global modest fashion market.
Downloads
References
Achmad Bashori, Y., Umami, K., & Wahid, S. H. (2024). Maqasid Shariah-Based Digital Economy Model: Integration, Sustainability and Transformation. Malaysian Journal of Syariah and Law, 12(2), 405–425. https://doi.org/10.33102/mjsl.vol12no2.647
Afraz, M. F., Bhatti, S. H., Ferraris, A., & Couturier, J. (2021). The impact of supply chain innovation on competitive advantage in the construction industry: Evidence from a moderated multi-mediation model. Technological Forecasting and Social Change, 162(June 2020), 1–12. https://doi.org/10.1016/j.techfore.2020.120370
Agit, A., & Muharram, S. (2024). Artificial Intelligence Capability in Education to Enhance Human Resources Quality from Economic Perspective. 738–746.
Agustin, F., Muhtadi, R., & Sahal, S. (2023). The Importance of Implementing Environment, Social and Government (ESG) and Maqasid Sharia-Based Islamic Finance in Islamic Bank. JISEL Journal of Islamic Economic Laws VI, 6(2), 2023. https://journals.ums.ac.id/index.php/jisel/index
Ahmad, F., Hossain, M. B., Mustafa, K., Ejaz, F., Khawaja, K. F., & Dunay, A. (2023). Green HRM Practices and Knowledge Sharing Improve Environmental Performance by Raising Employee Commitment to the Environment. Sustainability (Switzerland) , 15(6). https://doi.org/10.3390/su15065040
Aisah, N., Utomo, C. W., & Setyawan, R. (2024). Contribution of Green Banking to Performance Based on Integrated Sharia Maqasid: The Moderation Role of Islamic Social Reporting. E3S Web of Conferences, 571. https://doi.org/10.1051/e3sconf/202457103006
Akgun. (2015). Bridging Organizational Learning Capability and Firm Performance through Customer Relationship Management. Procedia- Social and Behavioral Sciences, 03, 531–540.
Alma, S., Nur, S., Zulkiffli, A., Hazimah, N., & Mat, N. (2024). The Link between Green Human Resource Management and Job Performance: Investigating the Mediating Role of Organizational Culture. Journal of System and Management Sciences, 14(12), 114–128. https://doi.org/10.33168/jsms.2024.1207
An-nisa, C. N., & Cahyani, R. (2024). The Relevance Between The Concept Of Green Economy And Maqashid Al-Shari ’ ah : An Alternative Strategy For Addressing The Challenges Of Pollution And Climate Change. Journal of Islamic Economics and Business Studies (JIEBS), 2(2).
Anjum, N., Rahaman, M. S., Choudhury, M. I., & Rahman, M. M. (2022). An Insight into Green HRM Practices for Sustainable Workplace in the Banking Sector of Bangladesh: The Role of Electronic HRM. Journal of Business Strategy Finance and Management, 04(01), 66–80. https://doi.org/10.12944/jbsfm.04.01.06
Arifin, A. Z., Nishida, D., & Suzuki, R. (2025). The Influence of Maqasid Sharia on the Financial Performance of Sharia Financial Institutions. Islamadina: Jurnal Pemikiran Islam, 3(1), 99–110.
Aydin, H. (2020). Market orientation and product innovation: the mediating role of technological capability. European Journal of Innovation Management, 24(4), 1233–1267. https://doi.org/10.1108/EJIM-10-2019-0274
Ayesha, I., Redjeki, F., Sudirman, A., Sari, A. L., & Aslam, D. F. (2021). Behavior of Female Entrepreneurs in Tempe Small Micro Enterprises in Tasikmalaya Regency, West Java as Proof of Gender Equality Against AEC. Proceedings of the 2nd Annual Conference on Blended Learning, Educational Technology and Innovation (ACBLETI 2020), 560(2020), 124–130. https://doi.org/10.2991/assehr.k.210615.025
Bakhshizadeh Borj, K., Bashirpour, M., Javanshir, N., & Jahedi, P. (2025). The hidden dimensions of halal brand: examining the role of frugality in consumer purchase decisions. Journal of Islamic Marketing, September. https://doi.org/10.1108/JIMA-11-2024-0529
Bharati, P., Zhang, W., & Chaudhury, A. (2015). Better knowledge with social media? Exploring the roles of social capital and organizational knowledge management. Journal of Knowledge Management, 19(3), 456–475. https://doi.org/10.1108/JKM-11-2014-0467
Carlbäck, M., Nygren, T., & Hägglund, P. (2024). Human Resource Development in Restaurants in Western Sweden – A Human Capital Theory Perspective Human Resource Development in Restaurants in Western Sweden – A Human Capital Theory. Journal of Human Resources in Hospitality & Tourism, 23(2), 289–314. https://doi.org/10.1080/15332845.2024.2282215
Chahal, H., & Bakshi, P. (2014). Examining intellectual capital and competitive advantage relationship: Role of innovation and organizational learning. International Journal of Bank Marketing, 11(1), 52–69. https://doi.org/10.1108/IJBM-07-2013-0069
Chen, C. J., & Huang, J. W. (2009). Strategic human resource practices and innovation performance - The mediating role of knowledge management capacity. Journal of Business Research, 62(1), 104–114. https://doi.org/10.1016/j.jbusres.2007.11.016
Cooper. (2017). Metode Penelitian Bisnis, Edisi 12, Jilid 1, Terjemahan oleh Rahma Wijayanti dan Gina Gania (4th ed.). Salemba Empat Karya.
Dakhan, S. A., Sohu, J. M., Jabeen, A., Mirani, M. A., Shaikh, J. A., & Iqbal, S. (2020). Impact of Green HRM on Employees Pro-Environmental Behavior: Mediating Role of Women Environmental Knowledge at Higher Education Institutions. IJCSNS International Journal of Computer Science and Network Security, 20(12), 202–208. https://doi.org/10.22937/IJCSNS.2020.20.12.222
Din, A. U., Yang, Y., Yan, R., Wei, A., & Ali, M. (2024). Growing success with sustainability: The influence of green HRM, innovation, and competitive advantage on environmental performance in the manufacturing industry. Heliyon, 10(10), e30855. https://doi.org/10.1016/j.heliyon.2024.e30855
Farhan, B. Y. (2024). Visionary leadership and innovative mindset for sustainable business development: Case studies and practical applications. Research in Globalization, 8(April), 100219. https://doi.org/10.1016/j.resglo.2024.100219
Farras, M. F., Hadian, D., Hardiyana, A., Tinggi, S., & Pasundan, I. E. (2024). The Influence of Transformational Leadership and Organizational Culture on Employee Performance (Study of One The Companies Operating in The Field of Publishing and Book Trading in The City of Bandung). Acman: Accounting and Management Journal, 4(1), 20–28. https://doi.org/10.55208/aj
Febrian, W. D. (2023). Strategy for Improving the Quality of Employee Work: Analysis of Training Implementation, Career Development and Team Work. Greenation International Journal of Economics and Accounting (GIJEA), 1(4)(4), 550–559.
Fidel, P., Schlesinger, W., & Cervera, A. (2015). Collaborating to innovate: Effects on customer knowledge management and performance. Journal of Business Research, 1–3. https://doi.org/10.1016/j.jbusres.2015.01.026
Firdiansyah, F. A., Rosidi, A., & Nur Iman, A. K. (2021). Implementation of Green Supply Chain Management in Halal Supply Chain Management - a Conceptual Model. ISLAMICONOMIC: Jurnal Ekonomi Islam, 12(1), 1–22. https://doi.org/10.32678/ijei.v12i1.257
Ghalih, M., & Chang, C. (2025). Aligning Halal Supply Chain Management Improvements with Global Sustainability Standards : A DEMATEL-Based Analysis. Economic Development, 13, 210–228. https://doi.org/10.2478/mdke-2025-0012
Głodek, P., Stawasz, E., Łobacz, K., & Niedzielski, P. (2016). Development of competitive advantage of small innovative firm-the role of use and utilisation of business advice. The Business and Management Review, 8(3), 67–78.
Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203
Harsanto, B., Pradana, M., Firmansyah, E. A., Apriliadi, A., & Ifghaniyafi Farras, J. (2024). Sustainable Halal Value Chain performance for MSMEs: the roles of digital technology, R&D, financing, and regulation as antecedents. Cogent Business and Management, 11(1), 41–67. https://doi.org/10.1080/23311975.2024.2397071
Harwiki. (2016). The impact of servant leadership on organization culture,organizational commitment,organizational citizenship behaviour (OCB) and employee performance in women cooperatives. Elshiver Journal International, 03, 283–290.
Hatani, L., Bua, H., Mukhtar, Sidu, D., & Geo, L. O. (2016). Development Model of Cacao Agro-Industry with Sectoral Competitive Advantage Based in Southeast Sulawesi, Indonesia. Global Journal of Flexible Systems Management, 17(2), 229–246. https://doi.org/10.1007/s40171-015-0119-8
Ingsih, K., Astuti, S. D., Riyanto, F., & Perdana, T. A. (2024). Entrepreneurial Competence, Entrepreneurial Motivation, Entrepreneurial Self-Efficacy on Entrepreneurial Intention: Evidence Gen Z Student Indonesia. Tamansiswa Accounting Journal International, 12(1), 1–14.
Juwaheer. (2019). Analysing the impact of green marketing strategies on consumer purchasing patterns in Mauritius. World Journal of Entrepreneurship, Management and Sustainable Development, 19, 36–59.
Kaleka, A., & Morgan, N. A. (2017). Which competitive advantage (s)? Competitive advantage-market performance relationships in international markets. Journal of International Marketing, 25(4), 25–49. https://doi.org/10.1509/jim.16.0058
Kalkan, A., Bozkurt, Ö. Ç., & Arman, M. (2014). The Impacts of Intellectual Capital, Innovation and Organizational Strategy on Firm Performance. Procedia - Social and Behavioral Sciences, 150(September), 700–707. https://doi.org/10.1016/j.sbspro.2014.09.025
Konatala, R., Milz, D., Weiser, C., Looye, G., & van Kampen, E. (2024). Flight Testing Reinforcement Learning based Online Adaptive Flight Control Laws on CS-25 Class Aircraft. AIAA SciTech Forum and Exposition, 2024, 22(June), 41–71. https://doi.org/10.2514/6.2024-2402
Madanchian, M., Taherdoost, H., & Mohamed, N. (2023). AI-Based Human Resource Management Tools and Techniques; A Systematic Literature Review. Procedia Computer Science, 229, 367–377. https://doi.org/10.1016/j.procs.2023.12.039
Madhani. (2009). Resource Base View (RBV) of Competitive Advantage: Importances, Issues, and Implications. Indian Management Research Journal, 01(676), 1–15.
Manzoor. (2020). An examinationofsustainable HRM practices on job performance: An application of training as a moderator. Sustainability (Switzerland), 19, 111–131.
Manzoor, F., Wei, L., Bányai, T., Nurunnabi, M., & Subhan, Q. A. (2019). An examination of sustainable HRM practices on job performance: An application of training as a moderator. Sustainability (Switzerland), 11(8), 1–19. https://doi.org/10.3390/su11082263
Marquard, M., & Lakhani, M. A. (2014). An existential-humanistic process model of knowledge creation: Evidence, limitations, and potential for innovation in virtual organizations. ELmL - International Conference on Mobile, Hybrid, and On-Line Learning, c, 1–7.
Masduqie, M. H. A., Syarifudin, S., & Yudha, A. T. R. C. (2021). Green Economy of Waste Bank in the Perspective of Maqashid Sharia in Surabaya. Jurnal Ekonomi Syariah Teori Dan Terapan, 8(5), 593. https://doi.org/10.20473/vol8iss20215pp593-606
Mauludin, H., Alhabsji, T., Idrus, S., & Arifin, Z. (2013). Market Orientation, Learning Organization and Dynamic Capability as Antecedents of Value Creation. IOSR Journal of Business and Management, 10(2), 38–48. https://doi.org/10.9790/487x-1023848
Muhajirin, M., Kamaluddin, K., & Ernawati, S. (2020). The Effect of Market Orientation and Product Innovation on Competitive Advantages of Gedogan Weaving MSME. Advances in Social Science, Education and Humanities Research, 465(Access 2019), 388–390. https://doi.org/10.2991/assehr.k.200827.099
Nurcahyo, S. A., Anis, M., & Thoha, A. M. (2024). Humanistic Leadership for Organizational Learning Capability : Integration of Maqashid Syariah and Knowledge Management. Journal Ihya Ulum Al Din, 26(2), 217–232.
Nurcahyo, S. A., Ferdianto, R., & Arismaya, A. D. (2025). Toward Sustainable Islamic Banking : The Role of FinTech , Knowledge Management , Green Banking , and Sharia Compliance. Economica: Jurnal Ekonomi Islam, 16(1), 91–118. https://doi.org/10.21580/economica.2025.16.1.23752
Nurcahyo, S. A., Ramadhani, N. L., & Isnawati, S. I. (2024). The Role of Strategic Human Resource Management to Improve the Sustainable Fashion Industry in the Start-Up Perspective of Fashion MSMEs. Jurnal Teknobuga UNNES, 12(2), 177–186.
Nurcahyo, S. A., Wikaningrum, T., & Thoha, A. M. (2025). Green banking practices and HRM in enchancing innovation capability: A knowledge management perspective on sharia banking performance. Diponegoro International Journal of Business, 8(1), 28–49. https://ejournal2.undip.ac.id/index.php/ijb/article/view/25080
Oladapo, I. A. (2024). Enhancing sustainable performance among Islamic banks in Saudi Arabia: the role of management support and environmental innovation. Cogent Social Sciences, 10(1). https://doi.org/10.1080/23311886.2024.2433701
Pala, F., Erdoğdu, A., Ali, M., Alnori, F., & Barut, A. (2024). Analyzing the linkage between Islamic financial literacy and Islamic banking services adoption: evidence from Turkey. Journal of Islamic Accounting and Business Research, 15(5), 784–817. https://doi.org/10.1108/JIABR-12-2021-0324
Primadasa, R., Kusrini, E., Mansur, A., & Masudin, I. (2025). Integrating DEMATEL-ISM-MICMAC: an interconnected model of halal-sustainable supply chain management (HSSCM) indicatorsfor SMEs. Journal of Islamic Marketing, 12, 112–134. https://doi.org/10.1108/JIMA-07-2024-0303
Ramles, P., & Br Perangin Angin, R. (2024). Leadership Development Strategies in Organizations: The Role of Human Resource Management in Improving Effectiveness and Productivity. Jurnal EMT KITA, 8(2), 801–810. https://doi.org/10.35870/emt.v8i2.2382
Rehman, S. U., Bresciani, S., Ashfaq, K., & Alam, G. M. (2022). Intellectual capital, knowledge management and competitive advantage: a resource orchestration perspective. Journal of Knowledge Management, 26(7), 1705–1731. https://doi.org/10.1108/JKM-06-2021-0453
Riana, A. V. (2024). The Impact of Green Banking Initiatives : Assessing Environmentally Friendly Banking on Islamic Banks in Indonesia. SUKUK: International Journal of Banking, Finance, Management and Business, 3(I), 1–15.
Rimi, N. N. (2016). Green HRM for Green Services: A Proposed Best Practices Green HRM Model for Green Banking Performance in Bangladesh. European Journal of Business and Management Www.Iiste.Org ISSN, 8(8), 60–69. www.iiste.org
Rizki, D., Jadidah, W. N., Azzam, R., & Afif, A. (2024). Development of Indonesian Halal Logistic : A SWOT Approach. Management Analysis Journal, 4810, 17–44.
Rozika, W., Dharma, S., & Sitorus, T. (2018). Servant Leadership, Personnel’s Job Satisfaction: The Role of Organizational Culture and Human Resources Practices. Academic Journal of Economic Studies, 4(2), 120–137.
Saifuddin, M., Hartini, S., Kusumasondjaja, S., & Lina, L. F. (2025). The synergy of green marketing, halal labels, and mediating role of brand image on purchasing of modern herbal medicine product. Asia Pacific Journal of Marketing and Logistics, 1–14. https://doi.org/10.1108/APJML-01-2025-0170
Sajeda Alma’abreh, Siti Nur ‘Atikah Zulkiffli, & Nik Hazimah Nik Mat. (2023). Leveraging Green Human Resource Management and Organizational Culture in Performance. Journal of Namibian Studies : History Politics Culture, 33, 121–134. https://doi.org/10.59670/jns.v33i.418
Sanputra, A. H. D., Miftakh, E. S., Kusna, S. H., & Agustin, W. T. (2024). Digitalization of BUMDes Management as a Performance Driver towards Digital Villages. International Journal of Public Devotion, 7(2), 190–201. https://journal.stkipsingkawang.ac.id/index.php/IJPD/article/view/6125
Santoso, B., Supriyati, Y., & Djamal, A. H. (2019). The Effect of Team Work and Motivation of Nurses’ Work on the Quality of Health Services at a Military Hospital in Indonesia. In International Strategic Management Review, 35(1), 1–9. https://doi.org/10.2991/icobame-18.2019.37
Saraswati, E. (2021). Market Orientation, Service Quality on Customer Satisfaction and Loyalty: Study on Sharia Banking in Indonesia. Golden Ratio of Marketing and Applied Psychology of Business, 2(1), 26–41. https://doi.org/10.52970/grmapb.v2i1.157
Sarfraz, M., Khawaja, K. F., Khalil, M., & Han, H. (2023). Knowledge-based HRM and business process innovation in the hospitality industry. Humanities and Social Sciences Communications, 10(1). https://doi.org/10.1057/s41599-023-02140-9
Sarif, S. M. (2019). Strategic ta’awun and fastabiqul khairat partnerships for sustainable competitive advantage among small and medium enterprises in the muslim world. Asian Academy of Management Journal, 24, 125–139. https://doi.org/10.21315/AAMJ2019.24.S1.9
Sarif, S. M., & Ismail, Y. (2020). Influence of Ta’Awun in Managing Stickiness of Zakat Institutions. Issues, 2, 2672–7471.
Saura, J. R., Skare, M., & Riberio-Navarret, S. (2022). How Does Technology Enable Competitive Advantage? Reviewing State of the Art and Outlining Future Directions. Journal of Competitiveness, 14(4), 172–188. https://doi.org/10.7441/joc.2022.04.10
Sodikin, M. (2020). Competitive Advantages of Sharia Banks: Role of Ihsan Behavior and Digital Marketing in New Normal. Journal of Digital Marketing and Halal Industry, 2(1), 1–14. https://doi.org/10.21580/jdmhi.2020.2.1.5769
Soeherman, A. D. G., & Panjaitan, R. (2022). Religio-centric Product Strategic: Halal Literacy and Brand Management Capabilities Towards Business Performance. Jurnal Siasat Bisnis, 27(1), 86–105. https://doi.org/10.20885/jsb.vol27.iss1.art7
Suppiah, V., & Sandhu, M. S. (2011). Organisational culture’s influence on tacit knowledge-sharing behaviour. Journal of Knowledge Management, 15(3), 462–477. https://doi.org/10.1108/13673271111137439
Suseno, G., & Muthohar, M. (2018). The effect of service Quality to customer satisfaction and loyalty in Sharia Bank. 186(Insyma), 186–190. https://doi.org/10.2991/insyma-18.2018.46
Susilo, H., & Mayowan, Y. (2024). Developing a Model for Increasing Human Resource Capacity in Multi- Businesses for the SME sector in Indonesia a Comprehensive Approach. International Journal of Religion, 5(11), 8612–8625. https://doi.org/10.61707/vgwsep98
Syafrizal, R. (2019). Analisis Kinerja Islamic Human Resources Berdasarkan Metode Maslahah Scorecard (Studi Kasus Pada Pt. Inalum). AT-TAWASSUTH: Jurnal Ekonomi Islam, 4(2), 277. https://doi.org/10.30829/ajei.v4i2.5554
Syapsan, S. (2019). The effect of service quality, innovation towards competitive advantages and sustainable economic growth: Marketing mix strategy as mediating variable. Benchmarking: An International Journal, 26(4), 1–22. https://doi.org/10.1108/BIJ-10-2017-0280
Syarifah, L. (2024). Harmonizing Sustainable Development Goals and Maqasid Shariah : A Strategic Framework for Indonesian Islamic Banks ( Case Study on Bank Syariah Indonesia ). Journal of Islamic Finance, 13(2), 106–117.
Tirno, R. R., Islam, N., & Happy, K. (2023). Green HRM and ecofriendly behavior of employees: Relevance of proecological climate and environmental knowledge. Heliyon, 9(4), e14632. https://doi.org/10.1016/j.heliyon.2023.e14632
Turban, Efraim, & Volonino, L. (2011). Information Technology for Management: Improving Strategic and Operational Performance (8th ed.). John Wiley & Sons.
Vu, H. M. (2020). A review of dynamic capabilities, innovation capabilities, entrepreneurial capabilities and their consequences. Journal of Asian Finance, Economics and Business, 7(8), 485–494. https://doi.org/10.13106/JAFEB.2020.VOL7.NO8.485
Wang, J., Yang, J., & Xue, Y. (2017). Subjective well-being, knowledge sharing and individual innovation behavior: The moderating role of absorptive capacity. Leadership and Organization Development Journal, 1–19. https://doi.org/10.1108/LODJ-10-2015-0235
Wedarini, N. (2019). Pengaruh Kualitas Produk Terhadap Kepuasan Dan Loyalitas Pelanggan Telkom Flexi. E-Jurnal Manajemen Universitas Udayana, 2(5), 243526.
Wu, S., Lim, A. F., & Lim, W. Y. (2025). Do source credibility, green experience, and green brand image shape sustainable consumer behaviour? A PLS-SEM-fsQCA model. Asia Pacific Journal of Marketing and Logistics, 1–17. https://doi.org/10.1108/APJML-01-2025-0110
Yang, X., Yu, X., & Liu, X. (2018). Obtaining a sustainable competitive advantage from patent information: A patent analysis of the graphene industry. Sustainability (Switzerland), 10, 1–25. https://doi.org/10.3390/su10124800
Published
Issue
Section
License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
The copyright of the received article shall be assigned to the journal as the publisher of the journal. The intended copyright includes the right to publish the article in various forms (including reprints). The journal maintains the publishing rights to the published articles. Authors are allowed to use their articles for any legal purposes deemed necessary without written permission from the journal with an acknowledgment of initial publication to this journal.
The work under license Creative Commons Attribution-ShareAlike 4.0 International License.
