Abstract

Local economy can be promoted through the development of small and medium industries by building up localindustrial core competence. Local core competence is one of the strategies to increase local competitiveadvantage through the optimization of local competitive potency. This study was aimed at drafting the strategyof local economic development through local industrial core competence based on competitive commodities ofBanyumas district.This study employed qualitative as well as quantitative approaches. The study site is Banyumas Regency. Datacollecting techniques include secondary data mining, survey, observation, in-depth interview, and focussedgroup disscusion. Data were then analyzed using interactive analysis, Analytic Hierarchy Process andInterpretive Structural Modeling.The results show that batik is the most potential industry to be the local industrial core competence in Banyumasdistrict. The competitive advantage of batik as the industrial core competence of Banyumas district can beexecuted through the following three stages: (1) initial stage (infrastructure improvement, finance and legislationsupport (2) main stage (human resource development, management and marketing, branding and the creation ofbatik uniqueness) and (3) final stage (increase in productivity and initiation of related and supporting industries).

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