8th Widyatama International Seminar on Sustainability
Enhancing Employee Engagement Through HR Practices, Organization Climate and Work Environment Dematria Pringgabayu1, Dyah Kusumastuti2, Nugroho J. Setiadi3 1
School of Business and Management, Bandung Institute of Technology, Indonesia School of Post Graduate Program , Universitas Widyatama, Bandung, Indonesia 3 Faculty of Business and Management, Universitas Widyatama, Bandung, Indonesia (Corrsponding author:
[email protected]) 2
Abstract - Employee engagement is an indicator that shows the success of human resource management within a company. This paper discusses what hr practices factors that can improve employee engagement, as well as the climatic and work environmental conditions, to strengthen the employee engagement. This study is a verification, which uses quantitative data and qualitative data to support research, such as words or phrases that are arranged in the questionnaire, or interview between interviewer and interviewee. The population in this study were employees of department of claim health providers, with a total of 94 respondents. The findings reveal that the compensation is still the main factor affecting employee engagement, as well as recruitment, job design and a good organizational climate. Keywords – Compensation, Employee Engagement, Job Design, Organizational Climate, Recruitment System, Work Environment
I. INTRODUCTION Human resources are an important asset for the company because man is a dynamic resource and should be owned by the company in achieving its goals, therefore, employees should be utilized as much as possible to achieve the goals set by the company.[1] In order for the company's goals can be achieved, the employees who work in it must have a good engagement, so that employees feel concerned about the future of the company where he worked and was willing to give a series of efforts and ability he had, to see the success of the company where he worked.[2] Likewise, in a privately-owned insurance company, human resources play an important role to maintain the stability of the business. Increasing number of customers of health insurance, of course, is very positive for the health insurance companies, but this could also be matched by the capabilities of the human resources in the company, particularly in the operational divisions, especially in the claim health provider departement, which must be able to provide optimal service to customers, so that they are satisfied with the company and show their loyalty. However, if studied further, it will show some of the problems in the company's internal, which, if based on the data obtained by the authors, that from 2014 until 2015, the number of employees in the department claim health provider, has a percentage of resignation more than 50%, even in branch Bandung, new employee resignation rate reached 80%. Later in 2015 was the department of claim
health provider turned out to be still experiencing similar issues, where the overall percentage of resignation when averaged is above 60% over the last two years. In relation with the phenomenon of high rates of resignation of employees from the department of claim health providers that since 2014 and 2015 had an average of more than 60%, according to the assumption of the author, it is a symptom of low levels of employee engagement, especially in the departement of claim health provider. The resignation of the employees of a company, is a strong indication that the employee does not have a strong commitment to the company, which is caused by low employee engagement, in this case the employees of the departement of claim health provider.[3] When an employee is bound to the company where he worked, he was not only a loyal matter how tough the job he had to do, but the employees will feel concerned about the company, and find it to be an important part of the company. [4] Employees will show an active relationship with the company where employees are willing to give something to help the success and prosperity of the company. [5] Should these conditions - low employee engagement - not be addressed immediately by the insurance company, it is not impossible the performance of the department of claim health provider as a whole will be disrupted, and could have an impact on the disappointment of clients who filed health insurance claims. Employees who resign, will cause the amount of human resources will be reduced, while the number of claims could be increased, so that the impact is in incomplete claims health insurance. Even for the long term, a company's reputation, especially for health insurance products is threatened. The authors noticed there was an interesting phenomenon, which on the one hand the company managed to grow rapidly, with high levels of profit and won a variety of honors, but on the other side that from internal sources, the employees turned out to have problems in terms of employee engagement, especially in the departments claim health provider. Therefore, the authors of this study only limits on the scope of the employees from claim health provider departement. II. METHODOLOGY This research was conducted using the method of verification, which is a form of research that is based on
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data collected systematically during the study, information on the facts and characteristics of of the object studied, by combining the relationship between the variables in it, then interpreted based on the theories and literature related to HR practices (the system of recruitment, job design, compensation), organizational climate, employee engagement and work environment as a moderating variable.
can be determined by performing tests on the two sides. To test the acceptance or rejection of the hypothesis, it is done by testing the two sides with a significant level = 5%. c)
Population and Sample Population is the generalization area consisting of the object / subject that has certain qualities and characteristics defined by the researchers to learn and then drawn conclusions. [6] The population in this study are employees of departement of claim health provider, with a total of 94 people. Using total sampling method, therefore in this study, the sample was selected as many as 94 employees of the departement of claim health provider.
Hypothesis test (t test) To determine the level of significance of the correlation coefficient, the authors use a statistical “t test” with the following formula:
t count =
r n2 1 r 2
Where is : t = significance level test results r = correlation coefficient n = amount of data
Hyphotesis Design As for the design hypothesis made by the authors is as follows:
d) Coefficient Of Determination (CD) The coefficient of determination (R2) essentially measures how far the ability of the model to explain variations in the dependent variable. The coefficient of determination between zero and one. Small coefficient determination means the ability of the independent variables in explaining the variation of the dependent variable is very limited. If the coefficient of determination is approaching one, it means that the independent variables provide almost all the information needed to predict the variation of the dependent variable. In general, the coefficient of determination of cross section data will be relatively low due to the large variation between each observation, while for the time series data usually has a high coefficient determination. [7]
a) Define Statistical Hypothesis Based on the statistical tools used, and the research hypothesis, the authors define two hypotheses that are used to test the statistical hypothesis of zero (H0) is formulated to be rejected, and the alternative hypothesis (Ha) that formulated to be accepted with the following formulation: 1. Ha : Recruitment system has an influence on employee engagement Ho : Recruitment system has no influence on employee engagement 2. Ha : Job design has an influence on employee engagement Ho : Job design has no influence on employee engagement 3. Ha : Compensation has an influence on employee engagement Ho : Compensation has no influence on employee engagement 4. Ha : Organizational climate has an influence on employee engagement Ho : Organizational climate has no influence on employee engagement 5. Ha : The system of recruitment, job design, compensation, and organizational climate, has an influence on employee engagement after being moderated by work environment Ho : The system of recruitment, job design, compensation, and organizational climate, has no influence on employee engagement after being moderated by work environment b) Determining Significant Levels Basis for decision-making based on significant figures according to the level of significance, which
e)
Determining the Acceptance Criteria of Hypothesis In order for the calculation of correlation coefficients can be known significant or insignificant level, the final result of the test statistic t (t) is then compared with t table. The level of significance of 5% (α = 0.05), meaning that if the null hypothesis is rejected at a level of 95%, then it is likely that the results of inferences have confidence level of 95%, and this shows that the relationship (correlation) is significant between two variables.
f)
Analysis of moderation regression models Therefore, this study uses moderation regression, so that consists of several steps in setting the regression model, among others: 1) Y = a + b1X1 + b2X2 + b3X3 + b4X4 2) Y = a + b1X1 + b2X2 + b3X3 + b4X4 + b5X5 3) Y = a + b1X1 + b2X2 + b3X3 + b4X4 + b5X5 + b6X5X1 + b7X5X2 + b8 X5X3 + b9 X5X4 Which is: Y = Employee engagement
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a = Constant b1 = The regression coefficients for X1 b2 = The regression coefficients for X2 b3 = The regression coefficients for X3 b4 = The regression coefficients for X4 b5 = The regression coefficients for X5 b6 = The regression coefficients for moderator variable X1 = Recruitment system X2 = Job design X3 = Compensation X4 = Organizational climate X5 = Work environment
3
4
The quantitative analysis was done by distributing questionnaires to all employees of the department of health claims provider with a total of 94 employees. The questionnaire consisting of 55 items statements, which represent four independent variables, one dependent variable and the other variables as moderators. Data processing was performed using the statistical application program through several stages of regression, and the results are as follows.
1
(Constant)
t
Sig.
1.996
.049
.391
.164
.230 2.381
.019
Compensation
1.009
.312
.664 3.236
.002
Job design
-.652
.346
-.382 -1.883
.063
.440
.214
.196 2.060
.042
(Constant)
14.470
7.101
2.038
.045
Sistem Rekrutmen
.394
.165
.232 2.386
.019
Compensation
.992
.315
.653 3.146
.002
Job design
-.637
.349
-.373 -1.823
.072
.453
.216
.202 2.093
.039
-.036
.079
Recruitment System
Organizational climate 2
Beta
6.943
Organizational climate Work environment
-.040
-.458
.066
Compensation
-1.360
4.087
-.895
-.333
.740
Job design
5.258
5.458
3.084
.963
.338
Organizational climate
1.474
2.968
.657
.497
.621
Work environment
1.185
2.912
1.306
.407
.685
SR*LK
-.035
.109
-1.411
-.323
.748
.084
.150
3.039
.560
.577
DP*LK
-.216
.201
-7.009 -1.076
.285
IO*LK
.169
.083
4.443 2.043
.044
(Constant)
21.739
37.294
.583
.561
Work environment
-.280
1.232
-.309
-.228
.821
Recruitment system
.320
.408
.189
.786
.434
.924
.466
.608 1.985
.050
-.708
.502
-.415 -1.410
.162
Organizational climate
.383
.414
.171
.923
.358
X*LK
.002
.012
.305
.199
.843
The above table can be further described as follows: Recruitment system variable before moderated by Work environment variable have a correlation value (Beta) with employee engagement for 0.230, and after being moderated by the work environment variable, the Beta value decreased to 0.189. In other words, the work environment variable, weaken the relationship between employee engagement and recruitment system. This shows that the recruitment system is not a variable that can be moderated or reinforced by the conditions of Work environment that perceived by employees, but it can directly have influence to increase employee engagement in a company. If the recruitment system is right, it can be assumed that employees feel tied to his/ her place to work, because they will tend to be more fit and feel comfortable with the job. Compensation variable before moderated by Work environment variables have a correlation value (Beta) with employee engagement variable for 0.664, and after moderated by the work environment variable, the Beta value decreased to 0.608. In other words, the work environment variable weakens the relationship between compensation and employee engagement. These results reflect that compensation will directly affects employee engagement to the company where he worked. Compensation which shall be sufficient for the employee, will make employees feel they no longer need to find another workplace. Job design variable before moderated by Work environment variable, has a correlation value (Beta) with
Standardized Coefficients
13.856
.817
-2.497 -1.861
a. Dependent Variable: Employee Engagement
Coefficientsa
Std. Error
-.233
2.279
Job design
RESULTS OF REGRESSION ANALYSIS
B
79.939
-4.241
Compensation
TABLE 1
Model
-18.608
Recruitment system
KOM*LK
III. RESULTS
Unstandardized Coefficients
(Constant)
.648
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8th Widyatama International Seminar on Sustainability
employee engagement at -0.382, and after being moderated by the work environment variable, the Beta value decreased to -0.415. In other words, the work environment variable, weakens the relationship between job design and employee engagement. Organizational climate variable before moderated by the work environment variable, has a correlation value (Beta) with employee engagement for 0.176, and after being moderated by work environment variable, Beta value was increased to 0.181. In other words, work environment variable can strengthen the relationship between organizational climate and employee engagement. These results reflect that organizational climate which is an internal state held by employees, will add a sense of attachment to the company, if he felt any work environment has been conducive too. .
for departement of claim health provider employees, who are able to make a claim more than others. In addition to be financial, management can also display the names of the employees were included in the top 10 best in Indonesia, so it becomes a trigger for other employees to work harder in order to become the top 10 best employees. The Company through the middle line manager, should be able to develop a performance management, which can help employees’ accountability system. The trick is to do a regular survey using questionnaires that are distributed via the internal web, especially that are related to employee engagement, and the factors that influence it. This course will greatly assist the middle line manager, to determine any factors that make employees feel bound by the company. Strategically, the directors can encourage creativity all his subordinates, especially in terms of systems and ways of working, a way to make a sort of "competition" which was followed by all employees from all regions. This competition has the theme of innovation such as what is owned by employees that can accelerate or shorten the duration of the completion of work, and for employees who are considered the most innovative and most likely to be implemented, it will get a good reward in the form of financial and non-financial. The board of directors may develop a strategy whereby PT Lippo General Insurance, especially for health insurance products, which have become a "booster" for the company's success, not only in cooperation with the hospitals only when customers want treatment, but also in collaboration with clinics. The goal is that the company can expand its target audience and ultimately increase profitability. Something like this has not been done by insurance companies competitors, so it can be a competitive advantage for the company. At the end of the company's employee engagement, leadership competencies needed a valueable prediction of job performance and leadership to manage energy, first in yourself and then in those people around you. Energy mean is how much percentage of a person's involvement in the work place physically, mentally, spiritually, emotionally and socially.[8]
IV. DISCUSSION Based on observations and interviews with informants, as well as quantitative data processing, then there are some things that could be a strategy to improve employee engagement in insurance companies, especially the departement of claim health provider, among others: Provides an introduction or orientation for new employees in the departement of claim health provider, concerning the overall vision and mission of the company, the state of the working environment, organizational structure, corporate culture, to the purpose and objective of the departement of claim health provider itself. Improving the intensity of two-way communication, particularly with regard to issues of work, carried out between the department head as a direct superior, to his subordinates in order to improve employee engagement to the company. With the existence of such communication, will make an employee feel they are appreciated and acknowledged, so it will be easier to feel bound, especially if the employee is given the opportunity to express what was on his/ her mind. Direct supervisor, or in this case the head of department, must ensure that employees who become subordinates, get the facilities needed to carry out his work optimally. Facilities were meant in this case, among others, both in physical form, or in the form of information, are some of the things that are expected to exist, so that can be used by employees, especially in the departement of claim health provider. Middle line manager or general manager can create a policy that contains a provision that new employees must participate in education and training, particularly with regard to the health sector, in order to claim department employee health providers can better understand the detail work that is related to the world of health. In the policy, the General Manager even give freedom to the employee to choose the education and specific training for himself, for really considered could improve its competence. Financial compensation systems that exist today can be further enhanced through a policy that provides incentives
V. CONCLUSION Based on the results of research and discussion that were outlined in the previous subsection, then in accordance with the purposes of this study, it can be concluded that the work environment perceived by respondents in this study still have to get further attention from the management, because it can give positive impact for the departement of claim health provider. Organizational climate variables had no influence on employee engagement, while the other three variables (recruitment system, compensation and job design) have a significant effect. Therefore it can be concluded that some of the variables that could have an impact on increasing employee engagement in the departement of claim health
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provider, it can be considered of how recruitment system is applied, then the amount of compensation given by the management to the employees, as well as the organizational climate perceived by employees during work. Work environment can not be concluded as a variables that can enhance employee engagement. It is also seen from the results of statistical analysis, where the work environment is not proven as a moderator variable between the independent variables (recruitment system, compensation, job design and organizational climate) and dependent variable (employee engagement). Therefore, it is necessary to improve the indicators of work environment, that could eventually become a driver of employee engagement in departement of claim health provider.
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