The Effects Of Islamic Spirituality to Small Business Performance
Dedeng Abdul Gani Amruloh
Department of Management, Sekolah Tinggi Ilmu Ekonomi DR. KHEZ. Muttaqien, Purwakarta, Indonesia,
Keywords: Islamic Spirituality, Entrepreneurship, Bussiness Performance, Small Business.
Abstract: Some entrepreneurship studies indicated Islam as a religion that encourages his people to become
entrepreneurs. The purpose of this empirical study is to measure the influence of the spirituality of Islam on
the performance of the business, in the province of West Java. The research method using descriptive
quantitative approach with a simple linear regression analysis by using sample of 100 owners and managers
of micro enterprises, the data obtained by survey method and using questionnaire as data collection
instrument. Statistical analysis was performed to test the hypothesis of the research that has possibility of
positive influence and significant correlation between Islamic spirituality to business performance of micro-
enterprises. The results of this study, based on of data processing shows that the spirituality of Islam has a
positive correlation to the performance of entrepreneurs, and the effect of Islamic spirituality on the
performance of micro business is positive and significant. It needs more comprehensive and a broader scope
of research ahead on Islamic spirituality in entrepreneurship. It become indispensable considering Indonesia
is the country with the largest numbers of Muslim in the world.
1 INTRODUCTION
The quality of entrepreneurship can be seen from
the high business performance that is proved by the
company's ability to survive and compete in the midst
of increasingly fierce competition climate, including
in the group of Micro, Small and Medium Enterprises
(MSME) which is very much in number compared to
big business. An entrepreneur is a complete person,
who possess managerial skills, entrepreneurial
behavior with good attitude, best service oriented to
customer, ability to manage and assess the company's
position in the market to choose suitable competing
strategy. The success of an entrepreneur is more
influenced by the internal factors that exist within the
entrepreneur. Owners and managers of SMEs should
be aware that the factors within the entrepreneur
themselves that most affect business
performance(Gürol and Atsan, 2006).
The conceptual approach as the basis of this study
is an indication that the entrepreneur's value system
and philosophy are internal factors of the company,
apart from strategic factors and external factors that
can influence the firm's attitude to produce business
performance (Zahra, 1993). The value system of an
entrepreneur is inseparable from his religion and
beliefs, so it needs to be done in-depth study through
research on the influence of religion and belief of a
person on the performance of his business.
The literature study from Balog et al. (2013),
found a strong influence between a value system and
an entrepreneur's confidence with business decisions,
culture, mission and other important organizational
outcomes including performance business. These
factors become more interesting and important to
learn more because in fact there are relative
conditions in the Indonesian society that majority are
Muslims and especially in West Java that is known by
the behavior of Islamic society, means a strong
community with teachings and behaviors that are
based on Islamic values which is probably also
practiced in running a business.
On the other hand, research on Islam and
entrepreneurship is also growing rapidly, the Islamic
viewpoint is based on a belief in Islam as a complete
and comprehensive religion (Qur'an 5: 3), including
how the community lives as an entrepreneur. Islam as
shown in the Qur'an and Hadith of Prophet
Muhammad having a view that Islam as a life guide
pays clear attention to entrepreneurship and business,
and Islam is a religion that encourages
entrepreneurship (Ramadani et al., 2015; Gümüsay,
2015).
650
Amruloh, D.
The Effects Of Islamic Spirituality to Small Business Performance.
In Proceedings of the 1st International Conference on Islamic Economics, Business, and Philanthropy (ICIEBP 2017) - Transforming Islamic Economy and Societies, pages 650-654
ISBN: 978-989-758-315-5
Copyright © 2018 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved

The the purpose of this empirical study is to
measure the influence of the spirituality of Islam on
the performance of the business, in the province of
West Java.
2 LITERATURE REVIEW
2.1 Entrepreneurship in Islamic
Perspective
The basic conception of entrepreneurship is
inseparable from the entrepreneurial conception of
Francis scientists such as Richard Cantillon, which
stated that entrepreneurship is the process of starting
a business enterprise to produce a product and selling
it at an uncertain price level for financial gain (Hoque
et al., 2014). Other conception stated that
entrepreneurship is an innovative person's activity to
exploit business opportunities, and entrepreneur is
someone who creates a new organization (Shane and
Venkataraman, 2000).
The Islamic perspective on entrepreneurship is
very clear, Islam as a religion gives great attention to
entrepreneurship and business, and places this
professional choice in a special place (Ramadani et
al., 2015). Islam strongly encourages its followers to
become entrepreneurs (Kayed and Hasan, 2011), this
can be seen from the argumentation that puts a
person's choice to become an entrepreneur or
businessman as a choice of life and to seek livelihood
in an extraordinary position, Hadith of Rasulullah
which narrated by At-Thirmidhi reveals that 9 out of
10 sources of income come from business activities
(Salwa et al., 2013), in another hadith narrated by At-
ThirmidhiRasulullah expresses a virtue for a Muslim
who becomes entrepreneur and runs business
honestly and sincerely in the afterlife will later be
placed with the group of Prophets, the devout (As-
sidiqien) and the shuhada (Hamid and Sa’ari, 2011).
Islam sees entrepreneurship not solely business
affairs that must be profitable, entrepreneurship and
business activity should be viewed as an Islamic ritual
(worship) to Allah, Enterprises must be run with
honesty and accepted (ridho) by Allah (Hamid and
Sa’ari, 2011) or in other words, running the business
of a successful Muslim entrepreneur must be obtained
without abandoning of faith (belief) to Allah and to
the Prophet Muhammad (taqwa) (Faizal et al., 2013).
2.2 Islamic Spirituality in
Entrepreneurship
Based on previous research is indeed there is
relationship or pattern between entrepreneurship and
religiosity. Audretsch et al. (2007) stated in the results
of their research about religious person in carrying
out entrepreneurial activity. In a different study, the
meaning of a person to religion has a positive impact
on his entrepreneurial activities divided in three
aspects, by influencing a person to become an
entrepreneur, how to run the company and how to
interact in internal and external relations of the
company (Dodd and Seaman, 1999).
There are two different terms that are used as a
value system that underlies entrepreneurial behavior
that is religiosity and spirituality. Religiosity is
understood as a set of codified of beliefs, which is
defined as the different ways in which people perform
special rituals, doctrines and emphasis on formal
structures (Kauanui et al., 2010). In the context of
entrepreneurship religiousity described as a set of
values, beliefs, norms, ethics and behaviors that are
owned and manifested in business activities (Arief,
2013). Religiousity has almost the same meaning as
spirituality, which is interpreted as a transcendent
pattern of relationship between the creature and the
Creator, a relationship that is not only ruhiah (spirit)
in the form of formal and regular rituals, so that the
meaning of spirituality is wider than religiosity.
Spirituality reproduces the "feeling" of an immaterial
reality which one believes to be the Almighty,
spirituality is also understood as an inner path that
enables one to discover the essence of his existence.
The religiousity and spirituality of entrepreneurship
or the done by a person in the conduct of a business
activity are not separated; one can view his work and
activities as part of the practicing religion which is
seen as an opportunity to increase one's contribution
to society through a right path, Neil (1997) in (Balog
et al., 2013). In the context of this research, religiosity
and spirituality are not interpreted separately, the
term that is considered capable to accommodate the
above definitions is spirituality in the perspective of
Islamic Religion.
2.3 Spirituality in Islamic Perpective
The essence of Islamic spirituality is to realizing the
demands of the Qur'an by looking at the Prophet as a
model and in accordance with the His instructions, or
in other words realizing tauhid and awareness of the
existence of Allah (Nasr, 1987; Kahn, 2009) in
(Suhaimi et al., 2013). Islam encourages Muslims to
The Effects Of Islamic Spirituality to Small Business Performance
651

be perfect in carrying out life, as servants of Allah. In
routine worships, also has the value of benefits for the
environment where the servant lives (Grine et al.,
2015).
The basic concept of spirituality in Islam is the
implementation of taqwa and the characteristics of
the taqwa can be seen from the Qur'an; Surah 2: 3-4;
Surah 2: 177; Surah 2: 183; Surah 3: 133-136; Surah
5: 8-9; Surah 23: 1-11 and Surah 25: 63-76. For a
Muslim to be an entrepreneur must be based on faith
to Allah and His Messenger, as affirmed in the Word
of Allah in the Qur'an 61: 10-11(Faizal et al., 2013).
With the foundation of faith there is a real limitation
between may or may not be done in business because
Muslims in carrying out entrepreneurial activities
should be in the way of honesty and hoping ridho of
Allah (Hamid and Sa’ari, 2011). Where based on
those verses the characteristic of a person who has
taqwa implements the Spiritual life as the pattern of
relationship between the Creator and the human, and
realizes the social responsibility in the pattern of
relations between humans with fellow human beings,
nature and other God's creations.
The characteristics of a Muslim entrepreneur
based on previous research is someone who has
obedience in ritual (worship) by performing prayers,
fasting, zakat and going Hajj to Mecca; have an
attitude of mutual forgiveness, have faith in God; and
one who always remembers Allah (Dhikrullah)
(Kamil et al., 2012). Din, Yaacob and Azmi in
Ramadani et al. (2015) stated another important
character that has to be possessed by a Muslim
entrepreneur is having knowledge and wisdom,
referring to the Holy Qur'an for daily life; performing
five daily prayers a day; carrying out zakat; helping
the poor and the needy; performing evening prayers
and dhuha; and gratefulis a wise, strong, and
intelligent entrepreneur, possessing a strong memory,
knowledgeable, experienced, simple, honest, wise,
fair and has a strong desire.
From Khaliq in Adamu et al. (2011) which stated
that spirituality is identical with the purity of the
heart, which is used to control all parts of the human
body, then spirituality is purifying the heart, and for
that it takes the divine qualities in a person such as
"taqwa" (piety), tawakkal (trust in Allah), "qonaah"
(contentment), "saber" (patience), "ikhlas" (purity of
intenstion), "risalah" (prophethood) and "akhira"
(the life hereafter).
Islamic spirituality basically can be measured by
seeing the implementation and expression of
someone in practicing the teachings of Islam, the
indicator of a person who underlies his daily life with
the Islamic teachings is someone who has self-
discipline, measured from the level of proximity to
Allah, the level of Islamic knowledge he has, level of
faith, high morality, responsibility and practice
(worship) of Islam (Dasti and Sitwat, 2014).
2.4 Business Performance
Corporate Performance Assessment becomes an
important part of scientific research in the field of
business policy (Dess et al., 1984). The company's
orientation in doing business is to achieve sustainable
competitive advantage by creating high efficiency
and effectiveness with its competitors, effectiveness
is measured by the compatibility between customer
expectations and what is provided by the company,
and efficiency measured by the use of the firm's
economic value of resources results in a high level of
customers’ trust (Neely et al., 2005).
Snow and Hrebiniak (1980) stated that the
company's business performance assessment
conceptually and practically can be viewed from
different angles, such as the point of view of the
usefulness of the stakeholders, they are capital
owners and workers, from the time period of
assessment, and performance criteria. Business
performance can be seen with viewpoints of
organizational quantity and capacity, such as
performance assessment of SMEs (Hudson et al.,
2001; Taticchi et al., 2010).
The characteristics of a company can be
distinguished by the size and type of company, in the
study of business performance included in the
category of SMEs revealed 6 (six) dimensions of
performance measurement of time, quality and
flexibility, the most widely used, financial
dimensions, consumer confidence and human
resources. These six dimensions have not generally
been able to comprehensively measure business
performance, however the dimensional approach can
support the achievement of corporate strategy
measurement (Hudson et al., 2001).
3 METHODOLOGY
The research method using descriptive quantitative
approach with a simple linear regression analysis by
using sample of 100 owners and managers of micro
enterprises, the data obtained by survey method and
using questionnaire as data collection instrument.
Statistical analysis was performed to test the
hypothesis of the research that has possibility of
positive influence and significant correlation between
Islamic spirituality to business performance of micro-
ICIEBP 2017 - 1st International Conference on Islamic Economics, Business and Philanthropy
652

enterprises. The results of this study are expected to
be able to provide enrichment to previous studies
which stated the existence of the influence between
Islamic spirituality and business performance.
4 FINDING
Based on the results of a survey conducted on 100
respondents whose are owners, and owners and
managers in the same time of micro businesses with
various types of businesses, respondents with age
between 25 - 73 years, with an average age of 35 years
indicating that they are still at productive age to
develop the business. Characteristics of respondents
based on educational level also showed 53% more
with senior high school education, although some of
them has Elementary and Secondary School as their
last education.
Answering the research hypothesis about the
indication of a relationship between a person's
religious value system and one's spirituality in life as
an entrepreneur with the success of his business
(Balog et al., 2013) can be proved in this study.
Statistically based on the results of data processing
shows that the spirituality of Islam has a positive
correlation to the performance of entrepreneurs with
0.43 points or are in enough category, and the
influence of spirituality on the performance of micro
business is positive and significant with a value of
19.2%.
Survey results show that the average respondents
understand the basic concepts of spirituality in the
perspective of Islam is the implementation of worship
or the manifestation of servitude to God, included in
running business activities. A Muslim who chooses
the way of life as an entrepreneur is encouraged to
optimize effort as part of seeking Ridho of Allah, they
are motivated not just to seek profit in the world but
also hope for the good of the afterlife (heaven)
(Adamu et al., 2011). Respondents have a high level
of pride which can be interpreted that as an
entrepreneur they do not leave their personal
attributes as a Muslim. They have a great tendency to
harmonize the teachings of Islam with their behavior
while running a business and always trying to
understand the teachings of Islam both from the
source of Islamic teachings.
The performance micro business of their business
surveyed is in good level, especially of the
punctuality of customer order completion and they
have high effort to continue the business. The
financial and production performance not much
change and / or tend to increase between 0 - 10% in
the last period.
5 CONCLUSIONS
An entrepreneurial study based on one's value system
becomes a very interesting phenomenon. This study
is limited to the quantitative proof of the spirituality
phenomenon that is always visible in the daily life of
people in West Java in various daily activities with
the assumption that other factors are considered fixed.
The future of more comprehensive research and a
broader scope of research on Islamic spirituality in
entrepreneurship is indispensable considering
Indonesia is the country with the largest Muslim
population but still only few people choose to be
entrepreneurs, whereas on the other hand Islam
strongly encourages Muslims to become
entrepreneurs (Gümüsay, 2015).
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