The Role of Strategic Management toward Microfinance Institution Performance in Indonesia

Ahmad Hermanto, Suharto, Husein Umar

Abstract: The development of industrial microfinance in Indonesia gained the appreciation and attention of various experts in the field of microfinance. Microfinance in Indonesia is considered to be one of the greatest in the world, and has undergone a shift in the service paradigm undertaken by Micro Finance Institutions in Indonesia. This paper seeks to uncover the role of management strategies in improving the performance of MFIs in Indonesia, in addition to internal and external factors of the MFI itself as an aspect that significantly affects performance. The literature review shows that management strategy plays a significant role in improving the performance of MFIs, in addition to internal factors of MFIs and the external conditions of MFIs in Indonesia.

Keywords: Strategic management, microfinance, microfinance institutions MFIs, MFIs Performance