A 2026 study by Hafiza Radif Purnama, Tezar Arianto, and Merta Kusuma from the Faculty of Economics and Business, Universitas Muhammadiyah Bengkulu, finds that compensation, training, and competency development significantly improve employee work effectiveness in Indonesia’s public sector. Published in the International Journal of Finance and Business Management, the research highlights compensation as the most influential factor, offering practical insights for improving performance in high-pressure institutions such as disaster management agencies.
Public Sector Performance Under Pressure
Public sector organizations are under increasing pressure to deliver fast, accurate, and accountable services. This challenge is especially critical for disaster management agencies, where employee performance directly affects emergency response and public safety.
In such environments, employee effectiveness is not just about completing tasks—it includes speed, coordination, decision-making, and adaptability. However, many public institutions still face persistent issues, including limited training, insufficient compensation, and lack of structured competency development.
These gaps can lead to slow response times, weak coordination, and reduced service quality, making human resource management a central concern for policymakers.
Study Based on Real Employee Data
The research by Hafiza Radif Purnama, Tezar Arianto, and Merta Kusuma focuses on employees at a regional disaster management agency in Indonesia.
A total of 43 employees participated in the study through structured questionnaires. The researchers analyzed the data using a statistical model to measure how three factors—compensation, training, and competency development—affect employee work effectiveness.
The analytical framework shown on page 8 illustrates how these three variables interact as key drivers influencing employee performance outcomes.
Key Findings: Compensation Leads, But Integration Matters
The study presents clear quantitative results showing that all three factors positively influence employee effectiveness:
- Compensation has the strongest impact with a coefficient of 0.750
- Training contributes positively with a coefficient of 0.231
- Competency development also shows a positive effect with a coefficient of 0.221
- All variables are statistically significant, both individually and collectively
These findings confirm that better pay, improved training, and continuous skill development all play important roles in enhancing employee performance.
Why Compensation Matters Most
Compensation stands out as the dominant factor because it directly affects employee motivation and satisfaction. Fair and performance-based compensation systems make employees feel valued and recognized, especially in high-risk jobs like disaster response.
The researchers from Universitas Muhammadiyah Bengkulu explain that compensation is not only a financial reward but also a form of acknowledgment for employees’ efforts and risks. When employees perceive compensation as fair, they are more likely to show higher commitment and productivity.
Training Improves Skills and Readiness
Training also plays a critical role by improving employees’ knowledge and technical skills. In disaster management contexts, training ensures that employees are prepared to handle emergencies efficiently and make accurate decisions under pressure.
Well-designed training programs help employees adapt to changing situations and improve their overall performance. However, the study notes that training must be practical and job-relevant to deliver real impact.
Competency Development Supports Long-Term Performance
Competency development focuses on building long-term capabilities such as leadership, communication, and problem-solving skills. While its immediate impact is slightly lower than compensation, its long-term benefits are significant.
Employees with strong competencies are more adaptable, innovative, and capable of handling complex challenges. This is particularly important in public sector organizations that operate in dynamic and unpredictable environments.
A Combined Strategy Delivers Stronger Results
One of the most important findings is the combined effect of all three factors. When compensation, training, and competency development are implemented together, they create a stronger and more sustainable impact on employee effectiveness.
This aligns with the Ability–Motivation–Opportunity (AMO) framework, where:
- Compensation drives motivation
- Training and competency development build ability
- Organizational support provides opportunity
According to Tezar Arianto from Universitas Muhammadiyah Bengkulu, integrating these elements creates a “synergistic effect” that significantly enhances overall work effectiveness.
Implications for Policy and Public Management
The findings offer clear recommendations for improving public sector performance:
- Implement fair and transparent compensation systems
Performance-based rewards can boost motivation and reduce turnover. - Focus on practical, skills-based training
Training programs should reflect real-world challenges, especially in emergency response. - Develop structured competency programs
Long-term development initiatives help build a resilient and capable workforce. - Integrate human resource strategies
Combining compensation, training, and competency development produces the best results.
These strategies are particularly relevant for disaster management agencies, where employee performance directly impacts public safety.
Broader Impact on Organizational Effectiveness
Beyond the public sector, the study also provides insights for private organizations. Employee effectiveness is a universal challenge, and the combination of fair rewards, continuous learning, and skill development is key to achieving high performance.
The research highlights that investing in human resources is not just a cost but a strategic decision that drives organizational success.
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