The role of innovation and technology in MSME performance: the importance of Muslim entrepreneurs’ motivation in open innovation

Innovation and technology are critical drivers of MSME performance. This study aims to investigate the role of innovation and technology on MSME performance through the entrepreneurial motivation of Muslim entrepreneurs using the perspective of open innovation theory. This study is a quantitative approach using an exploratory research method. The sample in this study was 458 Muslim MSME entrepreneurs in the manufacturing sector determined using the stratified random sampling technique. Data analysis used PLS-SEM through Smart PLS software version 4. This study confirms that innovation and technology have an influence on MSME performance through the entrepreneurial motivation of Muslim entrepreneurs. This study has succeeded in building a new theoretical paradigm related to the internalization of open innovation theory, motivation theory, human needs theory, and self-determination motivation theory to build a culture of innovation, provide resources to support innovation, and develop collaboration with external parties to obtain knowledge and resources that can improve MSME performance.