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The use of local wisdom as an innovation in the sustainability strategy provides opportunities for the business community to increase competitiveness and maintain their existence. This study aims to explain the application of local wisdom as a sustainable strategy innovation and the challenges faced in implementing the strategy. The object of this research is Pelanusa Community, a business community in Malang City that has successfully applied local wisdom as an innovation in its sustainable business strategy. This research uses a qualitative descriptive approach. Data collection techniques applied were in-depth interviews, non-participant observation, and documentation. The results showed that the application of local wisdom as a sustainable strategic innovation was proven able to support business acceleration, improve sales, and create value in the Pelanusa Community. Challenges faced by this community in implementing the strategy is in the form of member coordination, managerial skills, product design, and communication. For further research, it is recommended to use a pure business entity as the research object so that a more in-depth study can be carried out on the application of local wisdom as a sustainable business strategy innovation.

Sustainable Innovation; Strategy; Business Community; Local Wisdom