Strategic Management of Regional Development in Indonesia: A Systematic Literature Review

Abstract

Background. Indonesia’s decentralised governance has devolved substantial authority to sub-national governments, yet regional development outcomes remain spatially uneven and institutionally fragmented. Purpose. This review synthesises how strategic management is conceptualised and applied in Indonesian regional development, and how governance, public policy, and sustainability considerations shape that practice. Method. Following PRISMA 2020, a Scopus search returned 486 records; after screening by document type, language, publication window (2021–2026), and thematic relevance, 62 English-language articles and reviews were synthesised through bibliometric description and thematic analysis. Results. Five interlocking themes emerged: strategic management in regional development, governance and institutional capacity, public policy, sustainable development, and digital transformation. The evidence shows that strategy in Indonesian regions is enacted less through formal planning documents than through the interplay of institutional capacity, multi-level coordination, and stakeholder collaboration. Implications. Strengthening dynamic capabilities, aligning fiscal and regulatory instruments, and institutionalising collaborative governance are pivotal for translating regional plans into measurable development gains. Originality. The study offers the first theory-driven synthesis integrating the resource-based view, dynamic capabilities, institutional theory, and stakeholder theory to explain strategic regional development in a large decentralised emerging economy, and proposes a forward-looking research agenda.