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Inclusion of Information and Communication Technology to MSMEs Strategic Planning in Indonesia

Micro, Small and Medium Enterprises (MSMEs) have become one sector in Indonesia that are important for economic development. However, the system for MSMEs are unknown and unconstructed, especially with the development of information and communication technology that affect the sustainability and productivity of MSMEs. Therefore, this study’s first objective is to build a model that contains MSMEs model in macroscopic view with the involvement of ICT to enhance income for MSMEs. Second objective is to determine what recommendations should be given to raise the economic development received from MSMEs involvement according to the model. The results are a causal loop model is built based on previous researches about MSMEs that combine factors and important elements in the system. Based on the diagram, there are three recommendations given to the Government: trainings to MSMEs about ICT for their businesses, continuing to apply tax reduction for MSMEs, and enhancing their market shares by internalization process