Improve compensation package

Oct 13, 2025 by magicalceylontours.com 42 views

The Impact of Compensation and Employee Commitment on Employee Performance at PT. PLN (Persero) Lubuk Pakam North Sumatra Area

Introduction

In today's competitive business world, employee performance is a crucial factor that determines the success of a company. PT. PLN (Persero) Lubuk Pakam North Sumatra Area, a leading energy company, has been striving to improve its employee performance to achieve its business objectives. This study aims to investigate and analyze the effect of compensation and employee commitment on employee performance at PT. PLN (Persero) Lubuk Pakam North Sumatra Area.

Background

Employee performance is a complex phenomenon that is influenced by various factors, including compensation, employee commitment, leadership style, motivation, and work discipline. Compensation is a critical factor that affects employee motivation and job satisfaction. A fair and attractive compensation package can increase employee work motivation, leading to improved performance. Employee commitment, on the other hand, refers to the extent to which employees feel emotionally bound and rational to the company. A high level of employee commitment can lead to improved job performance and overall work culture.

Methodology

This study was conducted at PT. PLN (Persero) Lubuk Pakam North Sumatra Area, and the sample consisted of 190 employees from various divisions. The data was collected through questionnaires, interviews, and documentation studies. Multiple linear regression analysis and descriptive analysis were used to analyze the data.

Results

The results of this study indicate that both compensation and employee commitment have a positive and significant influence on employee performance. The F test results show that the two variables played a simultaneous role in improving performance. The T test results also show that employee compensation and individual commitment have a significant impact on performance. The determinant value of R² of 0.613 indicates that 61.3% of variations in employee performance can be explained by the compensation variable and employee commitment.

Analysis of the Effect of Compensation

Compensation is a critical factor that affects employee motivation and job satisfaction. A fair and attractive compensation package can increase employee work motivation, leading to improved performance. In the context of PT. PLN (Persero) Lubuk Pakam North Sumatra Area, compensation not only includes salary, but also benefits and incentives given by the company. When employees feel valued through appropriate compensation, they tend to be more committed to giving their best in their work. This confirms that good compensation can create a sense of satisfaction that results in increasing employee productivity and performance.

Employee Commitment

Employee commitment is the extent to which employees feel emotionally bound and rational to the company. At PT. PLN (Persero) Lubuk Pakam North Sumatra Area, commitment can be triggered by various factors, including a positive work environment and good relations between colleagues. When employees have a high commitment, they are more likely to do their duties better and contribute optimally to the company. This study shows that employee commitment not only has an impact on individual performance, but also affects the overall work culture.

Conclusion

Overall, this study confirmed the importance of proper compensation and strengthening employee commitment to improve performance at PT. PLN (Persero) Lubuk Pakam North Sumatra Area. By understanding that these two variables interact and have a significant impact, companies can be more effective in designing human resource strategies. Although this research does not discuss other factors such as leadership style, motivation, and work discipline, the results found are important foundations for further research and policy development within the company.

Recommendations

Based on the findings of this study, the following recommendations are made:

Improve compensation package: PT. PLN (Persero) Lubuk Pakam North Sumatra Area should review and improve its compensation package to ensure that it is fair and attractive.
Strengthen employee commitment: The company should focus on strengthening employee commitment by creating a positive work environment and promoting good relations between colleagues.
Develop human resource strategies: The company should develop human resource strategies that take into account the importance of compensation and employee commitment in improving performance.
Continuously evaluate and improve: The company should continuously evaluate and improve its compensation and employee commitment policies to ensure that they are effective in improving performance.

Limitations

This study has several limitations, including:

Sample size: The sample size of 190 employees may not be representative of the entire company.
Data collection method: The data was collected through questionnaires, interviews, and documentation studies, which may have limitations in terms of accuracy and reliability.
Variables studied: This study only examined the effect of compensation and employee commitment on employee performance, and did not consider other factors such as leadership style, motivation, and work discipline.

Future Research Directions

Future research should focus on exploring other factors that affect employee performance, such as leadership style, motivation, and work discipline. Additionally, research should be conducted to examine the impact of compensation and employee commitment on employee performance in different cultural and organizational contexts.
Frequently Asked Questions (FAQs) about the Effect of Compensation and Employee Commitment on Employee Performance at PT. PLN (Persero) Lubuk Pakam North Sumatra Area

Q: What is the main objective of this study?

A: The main objective of this study is to investigate and analyze the effect of compensation and employee commitment on employee performance at PT. PLN (Persero) Lubuk Pakam North Sumatra Area.

Q: What are the key findings of this study?

A: The key findings of this study are that both compensation and employee commitment have a positive and significant influence on employee performance. The F test results show that the two variables played a simultaneous role in improving performance, and the T test results show that employee compensation and individual commitment have a significant impact on performance.

Q: What is the significance of this study?

A: This study is significant because it highlights the importance of compensation and employee commitment in improving employee performance. By understanding the impact of these two variables, companies can be more effective in designing human resource strategies.

Q: What are the limitations of this study?

A: The limitations of this study include the sample size of 190 employees, which may not be representative of the entire company. Additionally, the data was collected through questionnaires, interviews, and documentation studies, which may have limitations in terms of accuracy and reliability.

Q: What are the recommendations of this study?

A: The recommendations of this study are to improve the compensation package, strengthen employee commitment, develop human resource strategies, and continuously evaluate and improve the compensation and employee commitment policies.

Q: What are the implications of this study for PT. PLN (Persero) Lubuk Pakam North Sumatra Area?

A: The implications of this study for PT. PLN (Persero) Lubuk Pakam North Sumatra Area are that the company should review and improve its compensation package, focus on strengthening employee commitment, and develop human resource strategies that take into account the importance of compensation and employee commitment in improving performance.

Q: What are the future research directions based on this study?

A: The future research directions based on this study are to explore other factors that affect employee performance, such as leadership style, motivation, and work discipline. Additionally, research should be conducted to examine the impact of compensation and employee commitment on employee performance in different cultural and organizational contexts.

Q: What are the benefits of this study for employees and the company?

A: The benefits of this study for employees and the company are that it highlights the importance of compensation and employee commitment in improving employee performance. By understanding the impact of these two variables, employees and the company can work together to improve performance and achieve business objectives.

Q: What are the potential applications of this study?

A: The potential applications of this study are in the field of human resource management, where it can be used to inform the development of human resource strategies and policies. Additionally, it can be used in the field of organizational behavior, where it can be used to understand the impact of compensation and employee commitment on employee performance.

Q: What are the potential limitations of applying this study in other contexts?

A: The potential limitations of applying this study in other contexts are that the findings may not be generalizable to other companies or industries. Additionally, the study may not have considered other factors that affect employee performance, such as leadership style, motivation, and work discipline.