Leadership Style, Compensation and Competence Influence on Employee Performance through Job Satisfaction

Abstract

Many factors can increase employee job satisfaction, such as leadership style, compensation, and competence, and this certainly has an impact on improving employee performance. The purpose of this study was to determine the effect of leadership style, compensation and competence on employee performance through job satisfaction. This research was explanatory research using quantitative methods. The population was 32 employees; the sampling technique used total sampling. The analysis used in this study is path analysis using the Smart PLS program. The results of the path analysis show that leadership style and compensation have a direct effect on employee performance, while the competency variable does not directly affect employee performance. Intervening job satisfaction, while compensation and competence have no effect on the intervening variable of job satisfaction. Indirect test results also show that leadership style, compensation and competence have no effect on employee performance through job satisfaction. Thus, Micro, Small, and Medium Enterprises (MSMEs), in running their business, need to pay attention to things that can improve employee work performance, such as leadership style, compensation provided, and competencies possessed by employees so that they can achieve maximum business goals.

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