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All Journal Journal of International Conference Proceedings
Oki Fad'ali Hilabi
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Humanities Decision Sciences, Operations Research & Management Electrical & Electronics Engineering Industrial & Manufacturing Engineering Languange, Linguistic, Communication & Media

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Linking Transformational Leadership, Compensation, and Employee Performance: The Mediationg Role of Work Engagement Harini Abrilia Setyawati; Gunarso Wiwoho; Bagus Waskito Adi; Aji Hidayat; Oki Fad'ali Hilabi
Journal of International Conference Proceedings Vol 6, No 1 (2023): 2023 ICPM Malang Proceeding
Publisher : AIBPM Publisher

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.32535/jicp.v6i1.2246

Abstract

This paper aims to examine the effect of transformational leadership and compensation on employee performance. The survey involved as many as 157 employees. The structural Equation Model is used to examine the research model. The statistical analysis tool used to test the hypothesis is Smart PLS. According to hypothesis testing analysis, this research concludes that transformational leadership significantly affects employee performance. However, contrary to the prediction, the result reported that compensation did not significantly impact employee performance. In addition, this study investigates work engagement as a mediating variable. The result showed that work engagement mediates the relationship of compensation with employee performance. Work engagement also significantly mediates the connection between transformational leadership and work performance. This study provides the managerial practice regarding improving employee performance through leadership, compensation and work engagement. Primarily, we recommend that SME leaders be more open and maintain employee development. Besides, compensation as a motivation strategy should be evaluated regarding the impact on employee work engagement.Keywords: transformational leadership, compensation, work engagement, and employee performance.
Co-Authors Aji Hidayat Bagus Waskito Adi Gunarso Wiwoho Harini Abrilia Setyawati