The Effect of Performance on the Sustainability of Coffee Farmers’ Cooperatives in the Industrial Revolution 4.0 in West Java Indonesia

Abstract

This research evaluates the effect the industrial revolution era 4.0 has had on the performance and sustainability of coffee farmer cooperatives, especially in the West Java region, considering that West Java is a coffee center area that is starting to be taken into account in Indonesia and the world in general, this is evidenced by the increasing number of farmer cooperatives coffee in the West Java region. One of the most monumental effects of the industrial revolution 1.0 was the birth of the British cooperative in Rochdale, the world’s first modern cooperative. The industry continues to develop, cooperatives continue to adapt and try to continue to develop in accordance with technological advances, especially now that the industrial revolution 4.0 has entered, which emphasizes information technology, especially the use of the internet. However, there has been no previous research examining the use of information technology in coffee farmer cooperatives, especially in the era of the industrial revolution 4.0, even though this information technology is very important in the development of cooperatives today. Quantitative descriptive method with SEM analysis was used to identify the effect of cooperative capability on the performance and sustainability of cooperatives in several coffee cooperatives in West Java. The study’s results found that the power of the cooperative did not significantly affect the performance of the Coffee Cooperative. Still, the capability of the cooperative had a positive and significant effect on the sustainability of the Coffee Cooperative. At the same time, the performance of the cooperative had a positive and significant impact on the sustainability of the coffee cooperative. The ability of cooperatives has a positive and significant effect on sustainability mediated by the performance of the Coffee Cooperative in the Industrial Revolution 4.0 era. This study recommends increasing the capabilities of cooperatives in membership, management, and business models to become sustainable cooperatives based on information technology to achieve added value from market-driven coffee products. The results of the study show that the respondents perceive that the cooperative’s performance has a positive effect on their sustainability. Improving the performance of cooperatives in terms of (1) productivity, (2) effectiveness, (3) quality, and (4) achievement can be regarded as having a direct impact on the Coffee Cooperative’s long-term viability. The industrial revolution in the agricultural sector is facing demographic challenges (ageing), so intelligent technology, artificial intelligence, big data, and augmented reality are strategic choices. The application of information technology has a direct or indirect positive impact on Indonesia’s agricultural sector. Cooperatives in coffee agribusiness is also increasingly needed to respond to market demand by applying Information and Communication Technology (ICT).