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Human Capital is an essential factor in dealing with crises, where the Human Capital strategy consists of Knowledge, Competence, and Expertise. Therefore, this study aims to determine and analyze (1) the effect of Knowledge on Innovation,(2) the influence of Competencies on Innovation,(3) the influence of Innovation on Business Performance, and (4) the influence of Expertise on Business Performance,(5) the indirect effect of Knowledge on Business Performance through Innovation. The sample in this study amounted to 101 SMEs in Pangkalpinang City. The data is processed using the Partial Least Squares analysis tool. The results of the analysis found that the Knowledge and Competencies variables have a significant influence on innovation. The innovation variable has no significant effect on Business Performance. Innovation has not significantly affected business performance because the innovations carried out are still partial and not digital-based because digital literacy is still low. On the other hand, expertise has a significant effect on Business Performance. Thus, it shows that there is a need to increase the knowledge and competence of MSME actors to become innovative. Metacognitive skills, learning skills, thinking skills, knowledge, and motivation.