The mediating effect of knowledge exploitability and organizational agility at relationship between marketing adaptation strategy and sustainable competitive advantage

This paper aims to investigate the mediating effect of knowledge exploitability and organizational agility at relationship between marketing adaptation strategy and sustainable competitive advantage. Data were collected from 189 SMEs in Indonesia and were analyzed by using Structural Equation Modeling (SEM). The result shows that new market exploration and development of marketing programs significantly affect knowledge exploitability, product diversity significantly affects organizational agility, knowledge exploitability and organizational agility significantly affect sustainable competitive advantage. Furthermore, knowledge exploitability and organizational agility mediate correlation between new market exploration, development of marketing programs and new market exploration with sustainable competitive advantage.


Introduction
A very turbulent environment, with dynamism, complexity and strong uncertainty facing the company today has led to a hypercompetitive market that involves a major threat to the survival of the company.
Successful companies can detect changes in the environment, are able to adapt and offer the right response by exploiting emerging opportunities and sources of new competitive advantage. The main problem regarding organizational survival and success requires the ability of companies to deal with changing environments and respond efficiently and effectively, so that the concept of organizational agility emerges. Assuming dynamic capability theory as a reference frame Hassna & Lowry (2018), the previous literature identified organizational agility as a dynamic capabilities of organizational in order to obtain sustainable competitive advantage (Shekarchizadeh & Branch, 2014).
Indonesian country has many potential Small and Medium Enterprises that can be developed with maximum. The distinctive patterns and colors of batik products have made Indonesian batik craft more known. For batik lovers, Indonesian is a place to find batik and accessories, because there are batik market, boutique and wholesale batik with varying price. SME's Batik made a big contribution to the economic progress in Indonesian.
Based on the data from Department of Cooperatives and SMEs (2017) can be seen that batik sales fluctuated. In 2010 and 2011 batik sales in Indonesian decreased by 0.84% and 0.71%, in 2012 experienced an increase of 0.62% but decreased again in 2013 by 0.68%. If the realization of the value of sales compared to the sales target, in the year 2012 -2017 sales realization is always below the sales target or in other words could not reach the target.
Increase or decrease in sales can be caused by several factors, such as changes in competition and consumers so companies need to adjust to ensure survival and success in business performance (Kwahk & Kim, 2017). The core development strategy is the company's ability to create a position in the market. To achieve high returns, companies can develop differentiation as their competitive advantage (Kim, Yoon, Chao, & Dang, 2015). Competitive advantage marketing strategies are increasingly important because of globalization and rapid change (Labrouche & Kechidi, 2016). To find new opportunities, companies must adapt and respond to change by developing and creating new ideas. Marketing adaptation is one way to improve performance (Nurcholis, 2018). Adaptation and new market responses need to be understood by top executives of the organization because they can have competitive advantages and get superior performance compared to competitors.
To survive and take advantage of external situations, adaptation strategies are a special way for companies to make adjustments (Monferrer, Blesa, & Ripollés, 2015). Local customization, differentiation or individualization is a form of marketing adaptation to make the right changes (Hankammer & Kleer, 2018). Adaptation of marketing strategies related to the adaptation of various aspects of the marketing mix such as products, promotions, prices and distribution (Chenavaz & Jasimuddin, 2017). Greater emphasis on product improvement, quality, new product development and customer service is a marketing adaptation strategy (Liu, Cheung, & Lee, 2016). Racela & Thoumrungroje (2019) only focused or limited on marketing mix and export performance. Another previous research concluded that the adaptation of marketing strategy is related to the adaptation of various aspects of the marketing mix such as product, promotional price and distribution (Szymanski, Bharawaj & Varadajan, 2008).
Organizational and structural enablers of agility are concerned with high-level issues pertaining to strategic orientation, business model selection, matters of centralized or decentralized decision making, and the locus of environmental scanning and control (Tan et al., 2009). Strategic orientation and the locus of environmental scanning and control in this study use marketing adaptation strategy. Marketing adaptation strategy is the ability of companies to analyze situations and determine direction to adjust marketing activities to customer needs and market demand. Marketing adaptation strategies consist of 3 three dimensions: exploration of new markets, product diversity and development of marketing programs. Meeting the unique requirements of different markets or adjusting new market opportunities is a method and source of the company's ability to explore new markets. Fulfilling the preferences and values of local consumers with product differentiation is a development of product diversity. The creation of variations in core marketing development and expansion of marketing programs to accommodate differences in environmental strength, consumer behavior, usage patterns and competitive situations is the development of marketing programs (Jirawuttinunt & Imsuwan, 2014).
The study from Mohiuddin, Halilem, Kobir, & Yuliang (2017) explains that a success knowledge management will create better organizational performance, and such relationship is unlimited and difficult to ascertain clearly. This means that there are so much that is still unexplored, such as in proving the direct relationship between antecedent that is related with knowledge and organizational performance, because there are many factors that can contribute toward organizational performance, and many complementary practices that needs to be considered in knowledge management activity.
The research result from I. C. Hsu, Lin, Lawler, & Wu (2007) shows that 80 % of the respondents state that knowledge is a strategic asset, and 78% of business opportunities are fail because it cannot explore the knowledge in the organization. While the study from Leticia Bautista-Frias (2012) explains that knowledge is the most important source of competitive advantage, but the relationship between knowledge management and competitive advantage is weak.
Organizational agility has been conceptualized in different ways and yet a consistent theme found in the literature is that organizational agility reflects sense and response capabilities. Both types of capabilities are necessary; firms are likely to struggle if either capability is limited or impeded in some way. An open question, however, pertains to the interface between sensing and responding. There is likely a time delay between sensing and responding and a tension underlying the use of scarce resources. The presence of sensing capabilities does not mean that the right response or indeed any response is sure to follow, no matter how evolved those capabilities might be. There is, in effect, a step between sensing and responding where decision making needs to translate sensing into responding (Tallon et.al., 2012).
The specific purpose of this study is conducting an empirical testing and analyzing the mediating effect of knowledge exploitability and organizational agility at relationship between marketing adaptation strategy and that could improve sustainable competitive advantage. The novelty of this research is the addition of the concept of knowledge exploitability that mediates the relationship between marketing adaptation strategy with sustainable competitive advantage.

Organizational Agility
In the last two decades organization theorists have also explicitly considered the role of agile performance in enabling firms to successfully adapt to fast changing and unpredictably disruptive environments (Appelbaum, Calla, Desautels, & Hasan, 2017). More recently, researchers have evoked agility to describe and explain organizational responses in contexts as diverse as information systems (Najrani, 2016), market orientation (Borshalina, 2015) and strategic alignment (Hassna & Lowry, 2018).
Agility as an ability of organization to detect and respond to environmental opportunities and threats with ease, speed, and dexterity (Tallon & Pinsonneault, 2011)." At its core, most studies view agility as intentional change such that ad hoc and unsystematic sense-response actions are not indicative of agility regardless of how well they portray agility-like traits. Rather, Competitive advantage can be obtained by implementing a strategy that establishes agility as a continuous and systematic variation in the output, structure or organizational process planned and identified (Tallon & Pinsonneault, 2011).

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An emergent consensus is that sense-response actions deemed agile can be specified using a bidimensional concept of magnitude of variety change (flexibility) and rate (speed) of generating variety change. The magnitude of variety change defines the structural dimension of change and involves the degree to which a firm is able to change the level of variety generation in its products, processes, services, or practices. With rare exceptions, definitions of agility associate higher agility with greater magnitude of variety generation; firms that can generate higher variety are deemed more agile. In this sense, the magnitude of variety related ideas in complexity theory. The variety itself is operationalized in multiple ways including different strategies deployed (Conboy, 2009).
Rate of variety change-defines the temporality of change and relates to the change in variety per unit of time. In other words, rate involves the time taken to sense and execute a given change in the magnitude of variety. Emphasizing this dimension in agility by noting that the consideration of speed of change (in addition to magnitude) makes it distinct from other concepts used to characterize sense-response pairs such as strategic flexibility, and by extension, mindfulness and resilience (Conboy, 2009).
Agility as conditional on environmental (industry) conditions. Different environments exhibit varying levels of market turbulence, competitive intensity, and customer need heterogeneity indicating the need to examine organizational agility relative to comparable firms within a specific industry or environment (Nadkarni & Narayanan, 2007). As a result, to calibrate an organization's agility implies identifying its relative position in a specific environment; that is, its ability to generate higher magnitude and rate of variety in its sense-response actions vis-à-vis its set of competitors and the characteristics of the environment.
To build an intuition of common themes and identify gaps in the literature we followed procedures outlined by (Shepherd & Sutcliffe, 2011) to trace the meaning and conceptualization of agility. Specifically, we first conducted a broad search in the management literature (including information systems and marketing) to identify articles using agility or related terms. Our search covered scholarly and practitioner journals, and yielded more than 100 studies in the strategy, information systems and marketing literature. From literature review above, we found that agility consists of 3 main dimensions, namely Responsiveness, Operational Flexibility and Business Relationship. Summary of research results from 2003 -2019 in table 1 shows the development of the 3 main dimensions of agility. Exploration is an experiment that uses new alternatives to have uncertain returns (Fink, Yogev, & Even, 2017), knowledge, skills and processes that are entirely new are the objectives of resource involvement in exploration. The desire to find something new is an improvised market motivation and emerging technology (Ritter & Walter, 2012). Market exploration represents an ability of organization to learn through questions, push the limits of knowledge and engage proactively in risk taking. exploration is an activity of concept testing, discovery, creative re-construction and research and development (J. Wang, 2016). Current skills and abilities are a distant point of departure and search for exploration discoveries (Subramony, Segers, Chadwick, & Shyamsunder, 2018).
Meeting the unique requirements of different markets or conformity with market opportunities that are the company's expectations is a form of exploration of new markets. The target limit for identifying small segments that lead to niche markets to obtain new customers is an alternative to customization. To get more resources with the aim that new markets are more developed can be helped by product development, prices, margins, sales management and marketing (Trivedi, Sridhar, & Kumar, 2016). To create a variety of products in the new market can identify design controls, dimensions and tolerances that 9 are more flexible. To compete in the speed of market change requires the speed of capability to develop and disseminate new offers (Uhl-Bien & Arena, 2017). Companies can respond to changes in demand uncertainty by providing product diversity and increasing competitive flexibility to get more customers when companies feel the need for product differentiation (Sumittra Jirawuttinaunt Phapruke, 2011). Product development and new customer marketing and acquisition are the most appropriate forms of adaptation strategies (Madhani, 2016).
Competitive in uncertainty markets requires the ability to develop new product quickly (Chen, Damanpour, & Reilly, 2010) . Firm can respond to changing of demand uncertainty with product diversity and gaining more customers in competitive environment (Dan & Zondag, 2016). The best adaptation strategy is develop new product and expand new customers (Adeniran & Johnston, 2016). Firms will drive flexible marketing activity when they are emphasizing to explore new market. Flexibility is one dimension of agility which means ability to create or embrace change in a timely manner (Rihova, Buhalis, Gouthro, & Moital, 2018).
From the description can be developed the following hypothesis: H1: exploration of new market significantly affects knowledge exploitability H2: exploration of new market significantly affects organizational agility H3: exploration of new market significantly affects sustainable competitive advantage

Product Diversity
Offering different, strange and new products to the market is a form of relationship between various product segments called product diversity (Dan & Zondag, 2016). Variations and multi-formalities of various quality products on the market are also forms of product safety (Dan & Zondag, 2016). The number of products available on the market is related to marketing adaptation strategies (Ghauri, Wang, Elg, & Rosendo-Ríos, 2016). Differences in products or brands that are relevant, have meaning and have customer value is a form of product differentiation (Almeida & Garrod, 2018). The small level of product diversity can still generate corporate profits at a high regional sales level, but performance will decrease if the level of product diversity is high (STAITA, 2014). To improve competitive advantage can be calculated with changes in product-based security (L. Jiang, Jun, & Yang, 2016). The provision of customer group needs can be done by the company in the form of utilizing the synergy of product diversity (Dan & Zondag, 2016). The creation of valuable variations for customers is as important as product features, such as packaging, distribution, warranty and after-sales support (M. Wang & Li, 2017).
Fulfillment of preferences and values of local consumers can be carried out by developing planned and consistent product diversity activities. Design, brand image, technology, features or specifications and packaging are forms of differentiation (Grolleau, Ibanez, & Lavoie, 2016). The emphasis on the creation process as a response to customer desires is done in the form of new products or services for customers that are created from the synergy of business lines and markets as a result of diversification (Y. K. Lee, Kim, Seo, & Hight, 2015). Long-lasting products are more attractive than products that are not durable so these non-durable products require more adaptation. Therefore, a small market segment that can be identified for products in the target market needs to be created. Improved design specifications according to customer needs also need to be done because the product life cycle is shorter in time (Rodríguez, Reca, Martínez, & Urrestarazu, 2015). Increased product variation is also influenced by rapidly developing technology, global competition and sophisticated customers, so that in order to obtain a source of competitive advantage it is necessary to manage a good variety of products (Stock, 2016).
Product diversity refers as the degree of linkage of different product segments by offering a unique, diverse product differential, unique product to market (Zou, Guo, & Guo, 2016). Variations and some formalities with his products of different quality in the market. Product diversity is the competing product and brand that was needed by the customer (J. S. C. Hsu, Li, & Sun, 2017). If companies feel product differentiation in a competitive market especially the needs of the market, they will develop a product differential for customers creating customer appeal and enhancing competitiveness (Thipsri and Ussahawanmitakit, 2009). Product diversity refers to planned corporate activity to make the values of local consumers with product differentiation (Sumittra Jirawuttinaunt Phapruke, 2011).

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Firm can respond to changing of demand uncertainty and providing the product diversity (Nurcholis, 2018). Capability to respond effectively to rapidly changing markets by increasing variety and rate of new product variations or introductions is strategic flexibility (Gelhard & von Delft, 2016). Flexibility is one dimension of agility which means ability to create or embrace change in a timely manner (Alpkan & Gemici, 2016).
From the description can be developed the following hypothesis: H4: product diversity significantly affects knowledge exploitability H5: product diversity significantly affects organizational agility H6: product diversity significantly affects sustainable competitive advantage

Development of Marketing Program
The concept of marketing program development is the creation of core variations and expansion of marketing programs in accommodation of environmental differences, consumer behavior, use of patterns and conditions of competition (Moscardo & Murphy, 2016). The marketing program developed is an adaptation of the marketing mix, for example products, promotions, prices and distribution (Lages, Abrantes, & Lages, 2008).
The marketing program aims to create customers or arrange a place of sale, not increase sales. Sharing of customers, facilities and marketing programs with other business units to increase profit margins in order to achieve greater efficiency (Bahri-Ammari & Bilgihan, 2017). Companies that have a low adaptation strategy have a lower market orientation compared to companies with higher adaptation (He, Sun, Lai, & Chen, 2015).
Marketing program development as the degree of variation of marketing development and expand marketing programs to accommodate differences in environmental and consumer behavior to accommodate with the exploit opportunities and capacity to identify more quickly than rivals (Nurcholis, 2018). This capacity equivalent with agility. From the description can be developed the following hypothesis: H7: development of marketing program significantly affects knowledge exploitability H8: development of marketing program significantly affects organizational agility H9: development of marketing program significantly affects sustainable competitive advantage

Knowledge Exploitability
Training to develop knowledge is important in internal learning and for creating new ideas in the company (Stone & Deadrick, 2015), because the basic components of innovation and assimilation of new technologies are knowledge (Romero & Martínez-Román, 2012). Another important component in organizational innovation is the educational background of managers, business owners and entrepreneurs (Machmud & Sidharta, 2016).
Knowledge and demands of the organization are greater because it can stimulate the process of innovation and technology improvement in organizations in the value chain (Romero & Martinez-Roman, 2012). Small organizations differ from large organizations because small organizations lack innovative autonomy and do not collaborate with technology centers. Therefore, an important route for the transmission of knowledge and experience in production networks is through business collaboration (Romero & Martinez-Roman, 2012;Dyer & Singh, 1998). The conclusion is that the purpose of sharing resources and knowledge is the basis of innovative projects and organizational competitive advantage. Knowledge management and organizational learning have a direct effect on organizational innovation, while organizational innovation and organizational learning have a direct effect on organizational performance (Noruzy, Dalfard, Azhdari, Nazari-Shirkouhi & Rezazadeh, 2012).
Important characteristics of innovation that influence the achievement of competitive advantage are : new products with marketing performance have a strong relationship, to increase profits and maintain market share new products need to be developed, Non-price components such as quality and design can also increase company growth, the product life cycle can be shortened by increasing the ability to substitute outdated products and to further shorten production time and accelerate the development of new products compared to competitors, process innovation is needed (Arnett & Wittmann, 2014).
The creation and use of institutional knowledge in business processes is knowledge management (X. Jiang, Yang, Pei, & Wang, 2016). Organizational learning, production and distribution of knowledge are sub-processes of knowledge management where organizational members can access and use company collective knowledge. Integration of knowledge management into organizational quality strategies has 4 steps: knowledge creation, knowledge sharing, evaluation and improvement of learning (Skačkauskienė, Hrušecká, Katinienė, & Čepel, 2018). In order to integrate this knowledge management, knowledge exploitability consists of quality of communication, quality of management organization, quality of information and communication technology in order to obtain maximum results (Widodo, 2018).
Knowledge towards innovative market and creating processes and product uniqueness based on exploitable knowledge (Pernicka & Lücking, 2012). The production of new knowledge may provide a temporary market monopoly. New market entrants soon challenge this position. Knowledge workers are expected to confirm than conflict with management interests as both workers and employers/clients share an interest in improving market performance by producing new exploitable knowledge.
The content of elements of a knowledge component factors must be normalized due to different units of measurement. The proposed method from (Skačkauskienė et al., 2018) allows for a quantitative evaluation of knowledge synergy in an organization. Structural and dynamic evaluation of knowledge synergy enables an organization to manage knowledge, thereby increasing its effectiveness.
Ability to explore and exploit innovation and opportunities by deploying requisite assets and knowledge, opportunities and leveraging a relationship network with speed as agility (Appelbaum et al., 2017).
Organizational agility promises to bridge the gap between the speed of environmental change and organizational learning (Deutscher, Zapkau, Schwens, Baum, & Kabst, 2016). Enterprise agility is a multidimensional ability to sense environmental change and quickly respond to unpredicted change with simultaneous assembly resources, capabilities, processes and knowledge (Yang & Liu, 2012).
Strategic flexibility learning from and being responsive to customer feedback achieved by fast diffusion of feedback information to different units and coordinated response between the units (Gelhard & von Delft, 2016). Strategic flexibility is firm's dynamic capability to reconfigure and reallocate resources, processes and strategies to response to uncertainty environmental (K. Z. Zhou & Wu, 2010). Strategic flexibility is one dimension of agility which means ability to create or embrace change in a timely manner (Singh, Oberoi, & Ahuja, 2013). The content of elements of a knowledge componentfactorsmust be normalized due to different units of measurement. In case of most knowledge component factors, the best value is the highest value, therefore factors should be maximized, i.e. minimizing factors should be reduced to maximizing factors. To normalize relations among employees, a construct is proposed it helps calculate the value of knowledge synergy correctly (Skačkauskienė et al., 2018).
From the description can be developed the following hypothesis: H10: knowledge exploitability significantly affects sustainable competitive advantage

Competitive Advantage
It is useful to draw on strategic literature and in particular, economic theory to understand the development of Competitive Advantage (Suresh Kannan, Nisar Ahmed, & Balaji, 2016). Explanations of performance difference were attributed to external factors within the marketplace within Industrial Organization (IO) theory. This area of economic theory focused on perfect competition, barriers to entry and market structure.
If competitors cannot replicate the uniqueness of the company, the company has a sustainable competitive advantage. Companies must be able to take advantage of opportunities and develop strategies to deal with threats. In addition, companies must have rare uniqueness that is difficult for other companies to imitate (Dirisu, Iyiola, & S., 2014).
Innovative behavior is a company resource that can affect the company's overall innovation. This behavior is a force that can enhance a company's ability to innovate so that it is a competitive advantage, 12 because innovation is a resource that requires transforming organizations into competitive companies (Filová, 2015).
In choosing products or services, consumers will consider whether the product or service is different and more competitive compared to other products or services from competitors, because now competition is more intense and consumers are increasingly critical (Racela, 2014). The combination of the ultimate goal and instrument or company policy is a competitive strategy guideline, where each company must have a competitive strategy (Zaini, Hadiwidjojo, Rohman, & Maskie, 2014).
The company can maintain a market leadership position if it has advantages that are not easy to replicate, for example being able to control business competition which includes the entry of new competitors, threats of product substitution, buyer strength and supplier offerings and competition among competitors.
Product uniqueness, product quality, and competitive prices are indicators of measuring competitive advantage. The uniqueness of the product is the uniqueness of the company's product or service that unites the art and desires of the customer. Product quality is the quality of the company's product or service design. While competitive prices are the company's ability to adjust the prices of products or services at standard prices in the market (Dirisu et al., 2014).
The company's main competency is basically a set of unique competencies that are owned and developed by the company, such as product quality, customer service, innovation in team building, flexibility and responsiveness to customers so that they can beat competitors. With the company's main competencies that are always being developed, the company will gain a sustainable competitive advantage in the long term, because it can serve customers better than competitors (Srivastava, Franklin, & Martinette, 2013).
The agile production was a successful strategy that prepare for a considerable performance. Agility refers to the rapid thinking ability with an easy and rapid movement thoughtful method (Mehrabi, Siyadat, & Allameh, 2013). Agility was joined in a manufacturing context in relation to flexible manufacturing systems (Christopher & Towill, 2008). Agility is the ability to respond with profitability and quick response to unpredictable changes (Skiera, Bayer, & Schöler, 2017). Agility is an organizational ability to react quickly and effectively to change radically of an environment.
Adaptability refers the organizational operations fit to their environment while flexibility emphasizes the ease of resource mobilization and the readiness of organizational resources. Strategic flexibility is capability to respond opportunities, manage the risks in the macro environment and respond effectively in the environment. Strategic flexibility is one dimension of agility which means ability creating or changing in a timely manner and positively associated with firm performance (Gelhard & von Delft, 2016). Agility is ability to detect threats and opportunities in the environment and respond quickly (Tallon & Pinsonneault, 2011). The key to sustained competitive advantage is ability to manage and reassemble, rapidly and decisively, complex networks of resources and relationships (Kotter, 2014). Specific organizational practices and processes associated with the application of strategic agility can manage corporate sustainability with a paradoxical lens (Ivory & Brooks, 2018).
From the description can be developed the following hypothesis: H11: organizational agility significantly affects sustainable competitive advantage.

Sample
The object of this study consists of 189 SMEs. The research unit consists of managers or staff authorized by the board of directors. Target population of research include SMEs in 7 cities / regencies in Indonesian amounting to 1201 SMEs. The questionnaire was applied to SMEs in 7 cities / regencies in Indonesian from June until October 2018.

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This research involves several concepts (constructs) that have been put forward in the design of hypotheses. These concepts exist that serve as exogenous variables such as new market exploration, product diversity and development of marketing program. For endogenous variables consisting of sustainable competitive advantage, knowledge exploitability and organizational agility. Each construct is measured by multiple indicator of the research question (scale item) adjusted to field conditions and references to several journal studies. Data collection techniques used in this study is a type of purposive sampling method.

Research Instruments
The measurements of this research variable were performed using multiple indicators that were treated as single variables. This measurement model is already used by Frone, Russell, & Cooper (1992) by correcting random error. The magnitude of the correction number is (1-) multiplied by the variance of each construct. From the 189 questionnaires distributed, all of the questionnaires were returned. All questionnaires can be returned because our surveyor face-to-face interviews with SMEs managers or owners are also carried out to check the accuracy of information, validate results and develop an understanding of the questionnaire.

Measurements
The indicator of new market exploration includes: meet unique needs, meet consumer values, adjusting different market opportunities level of market (Sumittra Jirawuttinaunt Phapruke, 2011). The indicator of marketing programs development includes: make variety of marketing development, accommodate differences in the environment, accommodate differences in consumer behavior (Nurcholis, 2018). The indicators of product diversity includes differentiation design, features and warranties (Frambach, Fiss, & Ingenbleek, 2016). Indicator of knowledge exploitability includes quality of communication, quality of management organization and quality of information (Widodo, 2018). The indicator of organizational agility includes: speed recognizing markets changes and ability to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to changing conditions in a rapid manner and build network of strategic, extended or virtual partnerships with suppliers, distributors (result from Table 1). The indicator sustainable competitive advantage includes: have uniqueness product, durability, and have strategic assets different from competitors (Barney, 1991). All research variables, measurement and indicators can be seen in Table  2. New market exploration variable was measured using 3 question items adopted from Sumittra Jirawuttinaunt Phapruke (2011). Each question item is measured using 10 measurement scales, where 1 indicates "strongly disagree" and 10 indicates "strongly agree".
Adjusting different market opportunities level of market. (Sumittra Jirawuttinaunt, Ussahawanitchakit, 2011) Marketing Programs Development Marketing programs development variable was measured using 3 question items adopted from Nurcholis (2018). Each question item is measured using 10 measurement scales, where 1 indicates 1.
Make variety of marketing development; 2.
Accommodate differences in the environment; "strongly disagree" and 10 indicates "strongly agree".

3.
Accommodate differences in consumer behavior (Nurcholis, 2018) Product Diversity Product diversity variable was measured using 3 question items adopted from Frambach et al. (2016). Each question item is measured using 10 measurement scales, where 1 indicates "strongly disagree" and 10 indicates "strongly agree".

Knowledge Exploitability
Knowledge exploitability variable was measured using 3 question items adopted from Widodo (2018). Each question item is measured using 10 measurement scales, where 1 indicates "strongly disagree" and 10 indicates "strongly agree".
Quality of management organization, 3.
Quality of information (Widodo, 2018) Organizational Agility Organizational agility variable was measured using 3 question items adopted from Table 1. Each question item is measured using 10 measurement scales, where 1 indicates "strongly disagree" and 10 indicates "strongly agree".

1.
Speed recognizing markets changes and ability to identify new market trends / opportunities 2.
Capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to changing conditions in a rapid manner.

3.
Build network of strategic, extended or virtual partnerships with suppliers, distributors Sustainable Competitive Advantage Sustainable competitive advantage variable was measured using 3 question items adopted from Barney (1991). Each question item is measured using 10 measurement scales, where 1 indicates "strongly disagree" and 10 indicates "strongly agree".
Have strategic assets different from competitors (Barney, 1991) Source: Results of Research development  According to (Ferdinand, 2002) Goodness of fit test value with chi square value (2) of 24,734 < 45,559 with a probability of 0.420 so that the null hypothesis that there is no difference between the two covariance matrices described is unsuccessfully rejected (Ferdinand, 2002).

Evaluate the Significance of Parameter Estimation
A variable can be used to confirm that it can together with other variables explain a latent variable. The strength of indicators in shaping latent factors can be analyzed using t-tests of regression weights generated by the model as presented in Table 2. The results of confirmatory factor analysis on exogenous variables indicate that each indicator or dimension of each latent variable has a high significance, namely the value of C.R. well above 2.00 with a probability <0.01. With this result, it can be concluded that the indicators forming latent variables are good indicators or dimensions to measure each of the latent variables.  chi-square value is D 2 (9,0.001) = 27.877

Confirmatory Factors Analysis of Endogenous Variables
One case or answer of respondents who are multivariate outliers. The multivariate outlier's data are not excluded from the model because according to Ferdinand (2005) in the analysis of research results, if there is no specific reason for issuing cases that indicate the existence of outliers, then the case must still be included in further analysis.

Item
Result Cut off value Explanation

Convergent Validity
The smallest lambda value = ,570 According to (Ferdinand, 2002), the required lambda value must reach > 0.40 All indicators together provide unidimensional for latent variables. Goodness of fit test value with chi square value 2 of 24,734 < 45,559 with probability of 0.420 so that the null hypothesis that there is no difference between the two covariance matrices described is unsuccessfully rejected (Ferdinand, 2002).

Evaluate the Significance of Parameter Estimation
The strength of indicators in shaping latent factors can be analyzed using t-tests of regression weights generated by the model as presented in Table 6. C.R or Critical Ratio is identical to the t-count in the regression analysis. Therefore, a C.R greater than 2.0 indicates that these variables are significantly a dimension of the latent factor that is formed.

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The results of the confirmatory factor analysis on endogenous variables indicate that each indicator or dimension of each latent variable has a high significance, namely the value of C.R. is above 2.00 with a probability <0.01.

Analysis of Full Model Structural Equation Modeling (SEM)
After the measurement model is analyzed through confirmatory factor analysis and it is seen that each variable can be used to define a latent construct, then a full SEM model can be analyzed. The results of AMOS processing are as follows.  Based on the analysis conducted presented in Table 5, it is known that the model we analyzed is a recursive model with a sample size of 189. Chi-Square value = 141,639 < 147,674 with df = 121 and probability 0.097. The Chi-Square results show that the null hypothesis which states the prediction model in accordance with observational data is acceptable which means the model is fit because it is not within the expected range value, so the model can be accepted and can be continued on hypothesis testing.  Table 6 shows that only 5 relationships and influences analyzed are at the level of significance expected because each C.R. value > 2.00. C.R. greater than 2.00 indicates that these variables are significantly a dimension of the latent factor formed. The result shows that new market exploration (NME) and development of marketing programs (DMP) significantly affect knowledge exploitability (KE), product diversity (PD) significantly affects organizational agility (OA), knowledge exploitability (KE) and organizational agility (OA) significantly affect sustainable competitive advantage (SCA).  Knowledge exploitability and organizational agility mediate correlation between new market exploration, development of marketing programs and new market exploration with sustainable competitive advantage.

Discussion
Exploration of new markets significantly affect knowledge exploitability. This means information resulting from new market exploration can lead knowledge exploitability. This is possible because Batik SMEs in Indonesia usually meet product uniqueness in accordance with the characteristics of each customer, so that the meet product uniqueness and customer value can improve the quality of information. The result of this study support the previous research conducted by J. Wang (2016) which states that market exploration represents the ability of the organization to learn through questions, push the limits of knowledge and engage proactively in risk taking.
Exploration of new markets does not significantly affect organizational agility. This means that information about product uniqueness, customer value and adjustments to different market opportunities cannot accelerate recognizing market changes and the ability to identify new market trends / opportunities. In addition, the capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner not also increases with information on the results of new market explorations. To build a network of strategic, extended or virtual partnerships with suppliers, distributors no need information on the results of new market explorations. The result of this study not supports the previous research conducted by Sumittra Jirawuttinaunt, Ussahawanitchakit (2011) which states that companies can respond to changes in demand uncertainty by providing product diversity and increasing competitive flexibility to get more customers when companies feel the need for product differentiation. The result of this study also not supports the previous research conducted by Rihova et al. (2018) which states that firms will drive flexible marketing activity when they are emphasized to explore new markets. Flexibility is one dimension of agility which means ability to create or embrace change in a timely manner.
Exploration of new markets does not significantly affect sustainable competitive advantage. This means that information on product uniqueness, customer value and adjustments to different market opportunities cannot directly influence to have product uniqueness, durability and have different strategic assets from competitors. New market exploration can increase competitive advantage if mediated by knowledge exploitability. In addition, new market exploration can also increase competitive advantage if mediated by organizational agility. Product uniqueness, durability and strategic assets that differ from competitors can be had if the company has quality of communication, management organization, information and communication technology. Quality of communication, management organization, information and communication technology can be had if the company have information on product uniqueness, customer value and adjustments to different market opportunities. Furthermore, product uniqueness, durability and strategic assets that differ from competitors can be had if the company can be had if the company accelerate recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and build a network of strategic, extended or virtual partnerships with suppliers, distributors. Speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and a network of strategic, extended or virtual partnerships with suppliers, distributors can be had if the company have information on product uniqueness, customer value and adjustments to different market opportunities. The result of this study supports the previous research conducted by Rihova et al. (2018) which states that firms will drive flexible marketing activity when they are emphasized to explore new markets. Flexibility is one dimension of agility which means ability to create or embrace change in a timely manner. The result of this study also supports the previous research conducted by Uhl-Bien & Arena (2017) which states that to compete in the speed of market change requires the speed of capability to develop and disseminate new offers.
Product diversity significantly affects knowledge exploitability. This means that differentiation design, features and warranties can directly improve the quality of communication, the quality of management organizations, the quality of information and communication technology. The results of this study in line with the previous research conducted by Frambach et al. (2016).
Product diversity significantly affect organizational agility. This means that differentiation design, features and warranties cannot directly improve speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and build networks of strategic, extended or virtual partnerships with suppliers, distributors. Differentiation design, features and warranties can increase competitive advantage if supported / mediated by knowledge exploitability. The results of this study in line with the previous research conducted by Frambach et al. (2016). The result of this study also supports the previous research conducted by Gelhard & von Delft (2016) which states that capability to respond effectively to rapidly changing markets by increasing variety and rate of new product variations or introductions is strategic flexibility.
Product diversity does not significantly affect sustainable competitive advantage. This means that differentiation design, features and warranties cannot directly affect SMEs having product uniqueness, durability and strategic assets that differ from competitors. Product diversity can increase competitive advantage if mediated by knowledge exploitability. In addition, product diversity can also increase competitive advantage if mediated by organizational agility. Product uniqueness, durability and strategic assets that differ from competitors can be had if the company has quality of communication, management organization, information and communication technology. Quality of communication, management organization, information and communication technology can be had if the company have differentiation design, features and warranties. Furthermore, product uniqueness, durability and strategic assets that differ from competitors can be had if the company can be had if the company accelerate recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and build a network of strategic, extended or virtual partnerships with suppliers, distributors. Speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and a network of strategic, extended or virtual partnerships with suppliers, distributors can be had if the company have differentiation design, features and warranties. The result of this study supports the previous research conducted by Stock (2016) which states that increased product variation is also influenced by rapidly developing technology, global competition and sophisticated customers, so that in order to obtain a source of competitive advantage it is necessary to manage a good variety of products. Development of marketing programs does not significantly affect knowledge exploitability. This means that make a variety of marketing development, accommodating differences in the environment and accommodating differences in consumer behavior can not directly improve the quality of communication, management organization, information and communication technology. This is because knowledge exploitability not only depends on the quality of the company's human resources. Marketing programs only to accommodate differences in environmental and consumer behavior to accommodate with the exploit opportunities. The result of this study does not support the previous research conducted by Nurcholis (2018).
Development of marketing programs does not significantly affect organizational agility. This means that make a variety of marketing development, accommodating differences in the environment and accommodating differences in consumer behavior can not directly affect speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and build a network of strategic, extended or virtual partnerships with suppliers, distributors. The result of this study not in line with previous research conducted by Nurcholis (2018) which states that marketing development programs as the degree of variation of marketing development and expand marketing programs to accommodate differences in environmental and consumer behavior to accommodate with the exploit opportunities and capacity to identify more quickly than rivals.
Development of marketing programs does not significantly affect sustainable competitive advantage. This means that make a variety of marketing development, accommodating differences in the environment and accommodating differences in consumer behavior cannot directly affect SMEs having product uniqueness, durability and having strategic assets different from competitors. Development of marketing programs can increase competitive advantage if mediated by knowledge exploitability. In addition, product diversity can also increase competitive advantage if mediated by organizational agility. Product uniqueness, durability and strategic assets that differ from competitors can be had if the company has quality of communication, management organization, information and communication technology. Quality of communication, management organization, information and communication technology can be had if the company make a variety of marketing development, accommodating differences in the environment and accommodating differences in consumer behavior. Furthermore, product uniqueness, durability and strategic assets that differ from competitors can be had if the company can be had if the company accelerate recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and build a network of strategic, extended or virtual partnerships with suppliers, distributors. Speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner, and a network of strategic, extended or virtual partnerships with suppliers, distributors can be had if the company make a variety of marketing development, accommodating differences in the environment and accommodating differences in consumer behavior. The result of this study support the previous research conducted by Bahri-Ammari & Bilgihan (2017) which states that sharing of customers, facilities and marketing programs with other business units to increase profit margins in order to achieve greater efficiency.
Organizational agility significantly affects sustainable competitive advantage. This means that speed recognizing markets changes and abilities to identify new market trends / opportunities, capability of a distributed team to speedily accomplish tasks and to adapt and reconfigure itself to change conditions in a rapid manner and build a network of strategic, extended or virtual partnerships with suppliers, distributors can directly increase sustainable competitive advantage (have unique products, durability and have different strategic assets from competitors). The result of this study support the previous research conducted by Kotter (2014) which states that the key to sustained competitive advantage is the ability to manage and reassemble, rapidly and decisively, complex networks of resources and relationships. The result of this study also support the previous research conducted by Ivory & Brooks (2018) which states that the specific organizational practices and processes associated with the application of strategic agility 24 can manage corporate sustainability with a paradoxical lens. This finding also support the assertion that agility will be able to improve market performance when decision makers have market skills, experience, learning orientation (Nemkova, 2017), and organizational agility has a strong influence on company performance (Ravichandran, 2018).
Knowledge exploitability significantly affects sustainable competitive advantage. This means that quality of communication, management organization, information and communication technology can directly increase sustainable competitive advantage (have unique products, durability and have different strategic assets from competitors). The result of this study support the previous research conducted by Ivory & Brooks (2018) which states that the specific organizational practices and processes associated with the application of strategic agility can manage corporate sustainability with a paradoxical lens. This finding also support the assertion that agility will be able to improve market performance when decision makers have market skills, experience, learning orientation (Nemkova, 2017).

Conclusion
The result shows the importance of knowledge exploitability and organizational agility to improve the SMEs Batik sustainable competitive advantage in Indonesia. Organizational agility has the confidence and value that puts customers on every business decision. It encourages the SMEs Batik to improve the sustainable competitive advantage based on the customers' expectation. New market exploration, development of marketing programs and product diversity is essential to enhance the knowledge exploitability and organizational agility in order to gain sustainable competitive advantage.
In managerial implication, sustainable competitive advantage of the Batik SMEs can be improved through marketing adaptation strategy. Marketing adaptation strategy in marketing policy can be done by development of marketing programs, product diversity and new market exploration. Knowledge exploitability and organizational agility are needed by Batik SMEs to improve sustainable competitive advantage according to new market exploration, development of marketing programs and product diversity. Improving new market exploration, ddevelopment of marketing programs and product diversity can gain knowledge exploitability and organizational agility. Improving knowledge exploitability and organizational agility can gain sustainable competitive advantage.
The theoretical implication of this research is that the sustainable competitive advantage of Batik SMEs can be improved by developing marketing adaptation strategy, knowledge exploitability and organizational agility simultaneously. The role of marketing adaptation strategy in improving sustainable competitive advantage will be more effective if it is done indirectly through knowledge exploitability and organizational.

Limitations and Further Research
The finding of this study is expected to contribute in the development of science, especially management science. The limitation of this research focuses only on the Batik SMEs with a relatively small sample size and does not separate the scale of micro, small and medium enterprises. Leaders or managers of Batik SMEs have different abilities in developing their business. They also have different views and behaviors towards the willingness to learn and understand market changes. Result of this study show that 6 hypothesis were not accepted. This is interesting area to another research with different respondents or variables. Future research also can be applied to the business sector with a larger scale and wider geographical area.