Knowledge as a mediator for innovativeness and risk-taking tolerance of female entrepreneurs in Indonesia

Abstract In the rapidly evolving small business environment of Indonesia, female entrepreneurs also play a crucial role. Information sharing and knowledge exchange are inseparable factors in the rapid growth of small and medium enterprises (SMEs), thus the influence of knowledge management influences risk-taking attitude and is closely related to innovativeness. Only a small number of studies, however, have looked at knowledge management in connection to innovation, optimism, and whether the impact is influenced by the firm’s risk-taking attitude. This study aims to investigate the connection between the innovativeness, information management, optimism, and risk-taking tolerance of female companies. By disseminating structured surveys, we took a quantitative strategy. To analyze the data we gathered, we used the SEM-PLS method. Our findings demonstrate how creativity significantly improves risk tolerance and information management. We also conclude that optimism greatly enhances risk tolerance and information management. Additionally, knowledge management increases a person’s ability for taking calculated risk.


PUBLIC INTEREST STATEMENT
Knowledge plays a crucial role in the innovativeness of women entrepreneurs in Indonesia. Women entrepreneurs who possess a strong understanding of their industry and market trends are able to identify new opportunities and develop unique solutions to meet the needs of their customers. Additionally, access to knowledge and resources allows these women to stay competitive and adapt to changes in the business environment. Furthermore, the ability to acquire new skills and knowledge through training and education programs can empower these entrepreneurs to expand their businesses and reach new markets. Overall, knowledge serves as a mediator for the innovativeness and success of women entrepreneurs in Indonesia.

Introduction
In order to obtain a competitive edge and access to global markets, small and medium-sized businesses (SMEs) are progressively implementing innovation and knowledge management based on information and communication technology (ICT; Hernández-Perlines et al., 2020). The significance of SMEs for economic diversity through job development is growing on a global scale (Susanty et al., 2022). Small and medium-sized businesses (SMEs) are essential for economic development in developing countries around the world, especially in Indonesia (Rauch et al., 2019;Singh & Kumar, 2020). It is well known that e-commerce has a broad variety of possible profits, but surprisingly, despite the fact that small and medium-sized businesses (SMEs) vary from big corporations in many ways, their level of innovation is still low.
Small and medium-sized businesses (SMEs) play a significant part in societal inclusion and Indonesia's economic growth. They are the biggest group of economic participants who have made a major contribution to the Indonesian economy and acted as a financial safety net throughout the history of the country (Festiawan et al., 2021). The State Office for Cooperative and SME's statistics show that Indonesia's SME sector has made an incredibly authentic impact, with 55,213,960 business units accounting for 99.98% of all company and 99.04% of labor intake, or 101.72 million people (Saragih et al., 2021). Businesses made up 63.11 percent of the non-oil GDP, investing 640.4 trillion dollars (or 52.9% of total GDP) and exporting 183.8 trillion dollars (20.2 percent). Women who are actively engaged as company proprietors or entrepreneurs in Indonesia are primarily found in micro and small businesses (MSMEs). They run or own caterers, tiny shops, food carts, beauty parlors, boutiques, and fashion companies. Sometimes they must be innovative and nimble in order to live, including by making risky choices (Bernoster et al., 2018).
Usually humble businesswomen in conventional market locations, rural women entrepreneurs are (Moreira et al., 2019). They are particularly common in small-scale apparel, culinary, and artisan businesses in the industrial sector (Amri & Giyarsih, 2022). Women businesses in Indonesia have been identified as the new drivers of economic development, bringing wealth and well-being to the country as their numbers keep growing (Saragih et al., 2021). Women entrepreneurs have been recognized by many parties as a major underutilized source of economic growth and development in emerging countries over the course of the last two decades or more (Cardella et al., 2020). Despite an increase in the number of women-led businesses and entrepreneurs, as well as the number of initiatives, policies, and resources intended to promote and develop women's entrepreneurship, the gender gap in entrepreneurship still exists in Indonesia, as it does in many other developing countries (Mustafa et al., 2021).
Academic publications on Indonesian female entrepreneurship are still scarce. This is due to at least two important reasons. First, there are few formal data on the proportion of women business owners in Indonesia and key characteristics of these individuals (Saragih et al., 2021). The second reason is that despite a rise in the number of women-owned companies and entrepreneurs, the gender gap in entrepreneurship still exists in Indonesia, as it does in many other developing nations (Rafiki & Nasution, 2019).
Academics must pay careful attention to this situation because small and medium-sized businesses are crucial to the growth of a country's economy. In addition to their sheer numbers, SMEs play important role in the establishment of jobs and product supplies (Saragih et al., 2021;Zaman et al., 2021). Consequently, the growth of small and medium-sized enterprises (SMEs) has a positive effect on the economic growth of a country, and vice versa. This study intends to experimentally investigate the relationship between optimism, innovativeness, knowledge management, and risk-taking tolerance among female entrepreneurs.

Literature review
Between SMEs and big companies, there are a number of limitations and differences. Some characteristics of SMEs are small management teams, a lack of personnels, small market share, and limited control over their business environment Cardella et al., 2020). These traits make SMEs infamously sluggish to embrace new technology, despite their willingness to take risks and innovate (Bernoster et al., 2018). This section examines the indicators and potential connections between the factors that influence SMEs' risk-taking decisions.

Innovativeness and optimism as predictors
Personal IT innovation has been shown to be an accurate predictor of user perceptions of utility and usability and how those perceptions influence the uptake of new technology . According to their results, personal innovativeness, resistance to change, and openness, which have been cited in the psychological literature to forecast user behavior in terms of their intentions to embrace new technology (Vu, 2020). The incorporation of personality traits into information systems and technology adoption can be a useful instrument for illuminating user behavior because personality traits have long been used in psychology to explain human concepts and conduct .
The low rate of ICT usage by SMEs in emerging countries is largely a result of a lack of resources and a lax regulatory climate (Pradana et al., 2022). In a recent research by Bernoster et al. (2020), trait problems and a dearth of e-commerce knowledge and comprehension were found to be the main barriers preventing SMEs in Iran, Malaysia, and India from expanding their knowledge. In empirical studies, overconfidence and optimism are frequently confused; however, there are metrics for both. For instance, self-efficacy, which is theoretically more closely linked to optimism than to overconfidence, is frequently used as a stand-in for overconfidence (De Meza et al., 2019). Similar to this, Giacomin et al. (2022) claimed that overconfidence in one's entrepreneurship skills is implied by self-reports of the significance of entrepreneurial skills being low. However, it seems justified to use overconfidence as a stand-in for positivity. Åstebro et al. (2015) looked into how innovators who had been advised to cease their business activities persisted despite their overconfidence and optimism. Their overconfidence measure links to overplacement because it contrasts the participant's assessment of correctness with that of the group. According to Ratten et al. (2017), women are more overconfident and optimistic than the general population, and optimism is associated with continuing to spend money (rather than time) after being advised to stop. Overconfidence is unrelated to carrying on after being told to cease wasting time and money. Bernoster et al. (2018), however, have differentiated optimism from overconfidence.

Innovativeness and optimism's connection with knowledge management
E-commerce is dedicated to generating employment and fostering regional development and innovation, despite the fact that SMEs adopting it lag behind bigger businesses (Rita & Huruta, 2020)). Additionally, SMEs can follow a worldwide strategy to reach a larger client base and handle environmental and competitive challenges in their sectors thanks to the adoption of technology, such as e-commerce . Some female company owners who have studied the variables affecting adoption and nonadoption sectors have recognized substantial cost reductions linked to the use of such technology (Susanty et al., 2019). Enterprise design was significantly influenced by organizational readiness, outside demand, and perceived user-friendliness (Fakhri et al., 2020).
Knowledge management, including the gathering and sharing of information, has a significant effect on an organization's system deployment (Glavas et al., 2019). According to Fakhri et al. (2020), the degree of electronic system usage rises when an organization promotes the accumulation and sharing of knowledge. Chong and Bai (2014) found that the choice to implement electronic systems by Malaysian SMEs is significantly influenced by knowledge management. However, there are instances where organizations are aware of it and its advantages but lack execution and knowledge, especially when there is no government support or effort to highlight this problem (Syarifuddin et al., 2021).
For a very long time, knowledge management (KM) has been regarded as a key idea and a foundation for the development of new ideas (Susanty et al., 2022). KM projects are being launched by many organizations to produce dynamic member impacts (Abbasi et al., 2021). Recent studies have highlighted the importance of organizations taking organizing skills through knowledge gathering, combination, and dissemination in the context of fast technological innovation . For a KMP to be effective, knowledge application, sharing, and acquisition are crucial elements of new technology acceptance (Audia & Silvianita, 2022). Making a company conscious of its knowledge on both an individual and collective level, as well as using this knowledge to develop and improve its business processes, is the aim of knowledge management (KM) operations (Martins et al., 2019).
Knowledge application refers to business processes that enable a firm to easily access knowledge through efficient storage and retrieval mechanisms, while knowledge sharing refers to business processes that distribute knowledge among all process participants, according to Hernández-Perlines et al. (2020). Business procedures that make use of current knowledge and acquire new knowledge are referred to as knowledge acquisition. Numerous studies have linked information gathering, knowledge application, knowledge sharing, and approval of e-commerce platforms (Al-Emran et al., 2018;Caloghirou et al., 2004;Chong & Bai, 2014;Drucker, 1993). Understanding patterns, trends, and the variations in the number of women entrepreneurs in developed, developing, and emerging nations due to cultural and societal constraints and access to information are crucial in the context of female entrepreneurs (Ratten & Tajeddini, 2018).
Based on the explanations, we constructed these hypothesized relationships:

H1:
There is a significant relationship between innovativeness and knowledge management H2: There is a significant relationship between innovativeness and risk taking tolerance H3: There is a significant relationship between optimism and knowledge management H4: There is a significant relationship between optimism and risk-taking tolerance

Knowledge management and its effect on risk taking tolerance
Utilizing the information shared within the company by those interacting with the firm's processes, businesses can learn (Susanty et al., 2022). However, applying the new information to practical operations is a difficult job that requires time, particularly at different degrees of complexity . Businesses are only in a better position to achieve a lasting competitive advantage when knowledge is used properly among organizational members, giving them the capacity to transform various types of knowledge into innovative goods or technologies (Martins et al., 2019).
Few studies examine specific KM skills that foster creativity and whether their impact is influenced by the firm's risk-taking culture. Hock-Doepgen et al. (2021). The readiness to consciously embrace risk while taking advantage of innovative chances is the true demonstration of corporate risk-taking tolerance (Choo, 2013). The firm's information management and utilization practices have an impact on the decision-makers' risk appetite (Kartawinata et al., 2021). The study of Donate et al. provided empirical support for the relationship between knowledge application techniques, innovation, and risk-taking tolerance (2022). However, there is a good chance that no substantial relationship between the two factors will be found in other circumstances . Therefore, we constructed these hypothesized relationships: H5: There is a significant relationship between knowledge management and risk-taking tolerance H6: There is a significant relationship between innovativeness and risk-taking tolerance through knowledge management as mediator H7: There is a significant relationship between optimism and risk-taking tolerance through knowledge management as mediator Consequently, we structured a research model in which knowledge management operates as a moderator between innovativeness and optimism and business owners' risk-taking traits. To apply this notion to forecast human innovation behavior, we acknowledge that domain-specific innovativeness should take precedence over global innovativeness (Bhagat et al., 2021). Our research model is illustrated as Figure 1.

The development of the research instrument
The construction of the study was scored using a five point Likert type scale (1 = strongly disagree and 5 = strongly agree). Furthermore, because the intended respondents were Indonesians, the final study item was first translated into Indonesian language.

Respondents and methods of data analysis
This study's respondents consist of small and medium-sized enterprise (SME) owners, of which 94.8% are women from various regions in Indonesia. We selected them through the database of ABDSI (Asosiasi Business Development Services Indonesia-Indonesian Business Development Services Association). They presently run a business and offer their goods-which include food, crafts, clothing, and drinks-through an online marketplace. The ideal sample size for the research should be roughly five to ten times the number of indicators used, according to the recommendations made by Hair et al. (2019).
The questionnaire contains thirteen elements or signs. We called 120 respondents via social media (such as Line, Instagram, and WhatsApp) and requested that they fill out a survey. In the end, we received 117 answers, although one was deemed incorrect. Data gathered from poll queries is analyzed using the Smart PLS software. This is because PLS-SEM is a statistical analysis tool that offers greater complexity, and SEM is one of the most well-liked methods among marketing scholars for assessing new theory models with multiple complex social structures (Sekaran & Bougie, 2016).  Fanaja et al., Cogent Social Sciences (2023) The present model is adequately complex to use PLS-SEM, with one variable acting as a moderator, for a total of four factors. The data analysis and outcome interpretation will be described in more depth afterwards.

Method for statistical analysis
Using SmartPLS software, the PLS-SEM technique was used in this research. PLS-SEM is primarily advantageous because it is more flexible and analytically reliable (Hair et al., 2017). Following that, two steps of statistical analysis using PLS-SEM are conducted: evaluation of the measurement model and evaluation of the structural model as shown in Table 1 (Hair et al., 2019). Along with the guidelines for each unit of analysis, Table 2 also contains the steps for conducting PLS-SEM analysis.

Results and discussion
During the data collection period, 117 respondents filled out survey forms. But of the 117 items of data collected, only 116 data items can be categorized as acceptable data sets after outlier inspection procedures. Table 3 presents an overview of the respondents involved.

Measurement model evaluation
The data must then be processed in order to identify the relationships between the variables and produce the study's findings after the interviewee profile has been examined. However, the data must first pass the standards of validity and reliability in the assessment of the measurement model before it can be used to determine the connection between factors. The reliability and validity of each idea are evaluated during the assessment of measurement models, as shown in Table 2. Focus is placed on indicator loading values, which represent indicator reliability values, and composite reliability, which shows the construct's internal coherence and reliability. Table 4 displays that all loading indicators for each construct have values greater than the projected value of 0.7, with the exception of I2 (0.671), KM1 (0.565), and RT2 (0.679). According to Hair et al. (2017), even though some indicators have values below the minimum threshold of 0.70, they can still be retained for further research because the composite reliability of each construct is satisfactory. As shown in Table 4 In other words, each construct's convergent validity value is higher than the lowest allowable value of 0.50. (Hair et al., 2019) Each association must have a Heterotrait-Monotrait correlation ratio (HTMT) of less than 0.85 in order to be deemed to have construct discriminant validity (Hair et al., 2019;Henseler et al., 2014). According to Table 5, HTMT values are generally recognized and have a good degree of discriminant validity. It is feasible to draw the conclusion that all of the data complies with the requirements of the measurement model, proving its validity and dependability.
The degree to which a concept is actually different from other constructs according to empirical criteria is measured by discriminant validity. As a result, proving discriminant validity suggests that a construct is distinctive and catches events that aren't covered by other constructs in the model. The second method of evaluating discriminant validity is the Fornell-Larcker criterion, which analyzes the square root of the AVE number with the relationships of latent variables (Fornell & Larcker, 1981). In particular, each construct's AVE should have a square root larger than its greatest correlation with the other constructs. The root AVE value of each construct or latent variable has the highest value of the correlation of the two variables in the model, according to discriminant findings using the Fornell-Lacker criteria ( Table 6). As a result, the variables in this study are able to justify why they have satisfied the requirements for discriminant validity.  • Business owners always optimistic about my future", • "I enjoy my friends a lot" (F), • "It's important for Business owners to keep busy" (F), • Business owners always expect things to go my way" (R), • "Overall, Business owners expect more good things to happen to me than bad".
• Bernoster et al. (2018) rebuilt and that the model has predictive value (Chin, 1998). The values of 0.02, 0.15, and 0.35 are interpreted as tiny, medium, and big impact sizes for the f-square values (Cohen, 1988). Our findings indicate that there is little correlation between financial education and financial literacy and financial happiness. Table 7 displays the study's R-square, Q-square, and f-square findings.

Structural model evaluation
Before moving on to the data analysis, we verified the items' SRMR to make sure the model is fit. Henseler et al. (2015) state that any number higher than 0.08 and less than 0.10 indicates a satisfactory model fit. The SRMR number, which is 0.083, tells us that the goodness of fit is adequate for further estimation. The structural model will then be looked at after an appropriate  (Cohen, 1988). assessment model has been identified. (Hair et al., 2017). Common method bias (CMB) for PLS-SEM is identified using a comprehensive collinearity assessment technique (Kock, 2015). The model's ability to forecast outcomes is found to be poor when two or more independent variables or exogenous constructs have a high degree of correlation (Sekaran & Bougie, 2016). By examining the number of the VIF (Variance Inflation Factor), the CMB is examined (VIF). For the model to be free of CMB, the VIF numbers must be below the 3.3 threshold (Hair et al., 2017;Kock, 2015). High VIFs can make it difficult to identify important relationships and result in skewed standardized estimates. According to our findings, the VIF values that actually occurred are in the range of 1.308 to 1.481, which indicates the model is devoid of any signs of CMB.
To measure the significance of each path, we observe the t-values. If the t-value is higher than 1.96, a relationship path is considered significant (Hair et al., 2017). If the t-value (measure of the connection between variables) fell below the cut-off point of 1.96, the path is seen as insignificant. Based on our findings, all of the hypotheses are accepted. The results are displayed in Figure 2, Tables 8, and 9, as all of the t-values are greater than 1.96.

Discussion
As shown in Table 8, there is a strong and positive correlation between knowledge management (KM) and innovativeness. Results from previous research also demonstrate that innovation can have an impact on knowledge management (Hernández-Perlines et al., 2020;Pradana et al., 2020). An SME"s capacity to create novel elements for its goods, tools, or management, as well as creative mixtures of already-existing traits, is referred to as innovativeness. Getting new information, applying it, and spreading it are all part of the invention process (Martins et al., 2019). Knowledge management may therefore affect how effective invention is (Syarifuddin et al., 2021). Thanks to efficient KM, communities and people can create, store, and share information (Susanty et al., 2019).
Additionally, according to hypothesis 2, there is a good and substantial relationship between being creative (innovative) and taking chances. This study's main emphasis is on Indonesian women entrepreneurs' creative and risk-taking business practices. According to Linton (2019), a person's propensity to take risks as well as the frequency with which some individuals are put in circumstances that increase their propensity to take risks have an effect on risk-taking behavior. In this case, the entrepreneur's viewpoint is also influenced by outside variables that control his or her behavior, in contrast to the "risk-taking" strategy. His environment has an impact on his conduct. Therefore, it might be crucial to approach innovation and risk-taking from a viewpoint that considers psychological and socio-psychological variables. Situational and societal factors cannot be totally disregarded because our entrepreneurial mentality and behavior are always the results of learned and inherited factors. This is a crucial topic to look into given the relatively high unemployment rate in Indonesia.
Numerous initiatives are being made to promote the expansion of the small business sector. This study is linked to earlier work by Rosenbusch et al. (2011) that shows younger companies are more innovatively lucrative. This goes against the findings of Rosenbusch et al., 2011), who discovered that a company's age had no impact on SME's innovativeness.
According to the third hypothesis, optimism and KM have a significant and favourable relationship. These results that positivity has a significant positive impact on information management are supported by prior study (Bernoster et al., 2020(Bernoster et al., , 2018. Although Luthans (2012) came to the opinion that persuasive factors do not promote discussion, many academics have looked at knowledge management (Ummah, 2021). Our results show that positive psychological capital, especially its elements of positivity and self-efficacy, significantly improve KM. If leaders are conscious of individual variations in psychological views toward engaging in KM activities, it will be simpler for them to create engaging and fruitful environments for promoting KM activities.  Additionally, a recent research found that optimism significantly and positively influences taking risks (Blake et al., 2022). This conclusion also closely relates to hypothesis no. 4.
The fifth hypothesis asserts that there is a positive and significant relationship between KM and risk-taking tolerance. García-Piqueres et al. (2019) found that KM had a significant positive effect on risk-taking, supporting our results. According to the study's results, SMEs can optimize information management's advantages by putting it into practice. For SMEs prepared to take some chances, the results are also encouraging. The likelihood that SME owners will take chances can be predicted because different ways of thinking and behaving encourage risk-taking (Gupta et al., 2017).
On the basis of the reasonable path coefficient and t-values, the sixth and seventh hypotheses (Table 9) are also approved. Positive characteristics like inventiveness and confidence play an even more significant role as indicators of Indonesian female SMEs owners' risk-taking endurance when KM plays a mediating role. This result backs up the earlier research by Saragih et al. (2021) and Ummah (2021).

Conclusion
This research seeks to experimentally investigate the connection among Indonesian women entrepreneurs' innovativeness, optimism, knowledge management (KM), and risk-taking tolerance. The creative and entrepreneurial mentality, which is a key element of the SME company development strategy, has been characterized as exemplified by risk-taking and knowledge management (KM). This research backs up the following three crucial conclusions: Through the adoption of new technologies, innovation results improve SME performance. Knowledge management and optimism are essential innovation components, and accepting risks has an impact on these SMEs' success. Taking risks is a demonstrated growth characteristic and strategy for enhancing the performance of small and medium-sized businesses. The collectivist culture of Indonesia, an emerging market, may urge SMBs to be more receptive to technological advancements that can enhance knowledge management and, more importantly, new modes of doing business, particularly through the adoption of e-commerce. Because it encourages flexibility, resiliency, and receptivity to new ideas, knowledge management is crucial. The growing Indonesian market economy benefits from SME invention and success when risk-taking and knowledge management are combined, particularly in times of crisis and disaster such as the COVID-19 outbreak.

Limitation
Our research's attempt to gather more than 116 poll respondents was hampered by scheduling issues. These figures undoubtedly do not encompass all of the views of female Indonesian Business proprietors due to the country's big population. We could only perform an online poll to gather data for this study because research was done under COVID-19 pandemic circumstances. Future studies might use a larger sample size and include more elements that could affect outcomes and outside variables. Qualitative methods may also offer more in-depth explanations of the occurrence of female businesses in Indonesia. We also suggest that future studies should consider the external environment as a key element of the SME business development model.

Implications
This research has a number of benefits, especially for women who run small and medium-sized businesses. They should start by keeping up with the knowledge management practices that encourage adaptability, corporate learning, and joint work. This might not have an immediate effect on SME success, but if combined with a risk-taking attitude, it might not be an issue. Risktaking is necessary for small and medium-sized company (SME) proprietors in Indonesia because it is a growing market. This is especially true for female entrepreneurs who are presently underserved in the business world. Despite the potential of unexpected dangers, they need not be concerned about failing in the face of change because some SMEs might not even be ready to try. KM necessitates flexibility and outside assistance because SMEs seem to encounter significant and varied barriers when trying to implement new technologies.