Factors Affecting Motivation and Performance: Bumdes Employees of Banyuwangi Regency

Abstract

This study aims to analyze the effect of self-efficacy, work discipline, and compensation on work motivation and performance of employees, with a focus on transformational leadership as part of the context of contemporary management. The objects of the study are the managers/directors of Village Owned Enterprises (BUMDes) in Banyuwangi Regency, East Java, currently facing a transition phase toward professional autonomy and clean governance. Using a quantitative approach, data were collected from 85 directors and core managers of BUMDes selected using purposive sampling to ensure respondents have tenure and relevant capabilities in assessing leadership innovation. Instrument testing showed all variables valid (AVE > 0.5) and reliable (Cronbach's Alpha > 0.6). Structural model testing revealed that self-efficacy and work discipline positively and significantly affect work motivation. However, compensation was found not to significantly affect work motivation. Furthermore, hypothesis testing showed that self-efficacy, work discipline, compensation, and transformational leadership do not have a direct significant effect on employee performance. Conversely, work motivation was found to have a strong positive and significant effect on employee performance. This finding reinforces that in village-level organizational contexts like BUMDes, work motivation acts as a mediating variable or crucial psychological anchor.