Factors affecting work satisfaction and employee performance in automotive industrial chain

Abstract

Purpose: This study aimed to analyze the determination of compensation, motivation and organizational commitment to employee performance and job satisfaction as an intervening variable. Design/methodology/approach: The statistical method used is the Structural Equation Model with a total sample of 112 respondents. This study uses a questionnaire to measure the factors affecting work satisfaction as compensation, motivation, organizational commitment, job satisfaction and employee performance. Findings: The results of this study found that there were positive and significant effects of compensation on the job satisfaction, and organizational commitment to job satisfaction as well as the effect of motivation on employee’s performance. Moreover, the insignificant effect is found in the effect of the job satisfaction on employee performance, the motivation on the job satisfaction, the compensation towards the employee performance and the organizational commitment on the employee performance. Mediation test proves that the job satisfaction is able to mediate the effects of compensation, motivation and organizational commitment on employee performance. Practical Implications: The results of this study can be the basis for the management of automotive product distributors in Batam City to increase compensation, and motivation for employees to improve job satisfaction and company performance. Originality/value: This study confirms the result that there are positive and significant effects of compensation on job satisfaction and organizational commitment to job satisfaction, and the effect of motivation on employee’s performance.