The Fourth International Conference on Entrepreneurship | Book Two
FOREWORD Welcome to the 4th International Conference on Entrepreneurship (ICOEN) 2017, Dili, Timor Leste On behalf of The Organizational Committee, Honorable Chairs, Conference Chairs , and Conference Co-Chairs, its is a great pleasure to welcome you to this 4th ICOEN Annual Conference 2017 in Dili, Timor Leste.
A special word of appreciation to our Conference Chair , Miguel Lucas Lay Costa, SE., M.M.; Manuel Gonvalves Lic. Eco, M.M, Fransisco Vicente Lic Eco, M.A; Manuel Loe Siga Lic Eco, M.M; Faustina da Costa Lic, CSH for their enormous efforts and good collaboration toward the arrangement for hosting this annual ICOEN conference.
The ICOEN 2017 activity will enhance good relationship between academic scholars and business practitioner in Organization. We do hope you have enjoyable and enriching experience throughout the conference , and take adventage of the collaborative, friendly and community of advanced scholarship from our international conference. May I also take this opportunity to invite you to the 5th ICOEN 2018 to be held in Universitas of Ciputra , Surabaya, East Java, Indonesia. Last but not least, we would like to express our sincere gratitude to everyone who has contributed and made the joint conference a success.
Best wishes, ICOEN 2017, Steering Committee Chair Dr. J.E.Sutanto, M.M. Graduate School, Universitas of Ciputra Surabaya, INDONESIA
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The Fourth International Conference on Entrepreneurship | Book Two
FOREWORD
It is my great pleasure to welcome you all in the 4th International Conference on Entrepreneurship (ICOEN) 2017 I would like to delivery my sincre thanks to the working. Team Universitas of Ciputra, Surabaya Indonesia, for their Enormous contribution towards the detailes arrangement of the 4th International Conference on Entrepreneurship (ICOEN) 2017, Dili, Timor Leste). The conference is held on September 06th and 08th, 2017, moreover. It attracts educators, researchers, and entrepreneurs which related with scientific disciplines of practitioners. On this occasion, let me give special thanks to the Keynote Speakers: (1) Dr. Charles Chow East-West Management University, Singapore; (2) David S. Dixon University of New Mexico, USA, (3) Dr. Amir Shaharuddin, Universiti Sains Malaysia, Malaysia, (4) Prof. Dr. Lucas da Costa, S.E., M.Si., Universidade da Paz, Timor Leste, (5) Dr. Ir. Denny Bernadus, M.M.,Ciputra Education Foundation, Indonesia, (6) Dato Dr. Kim Tan Advisor, TBN Asia; TRUSTEE, TBN UK I also want to thank the kind support all of co-host which your contribution to this seminar as reviewers and keynote speakers make this event more meaningful and evaluable. We are also thankful to all reviewers, for their commitment, effort and dedication in understanding the task of reviewing all of the full paper. We would like to thank to all authors who have submitted their papers to be reviewed, those whose paper were chosen to be presented in the seminar, and those who have submitted manuscripts to be publishes in proceeding. On behalf of all my colleagues, I would like to offer my best wishes for a successful, stimulating and memorable conference
Sincerely, ICOEN 2017, Conference Chair Miguel Lucas Lay Costa, SE., M.M Universidada da Paz, Dili, Timor Leste
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The Fourth International Conference on Entrepreneurship | Book Two
COMMITTEE Steering Committee 1. Dr. J.E.Sutanto, M.M. Universitas of Ciputra Surabaya 2. Dr. Ir. Dominggos Cairesi B.B. Gomes, M.Sc. Universidade da Paz, Dili, Timor Leste 3. Ir. Rini Retnowati, M.PA Universidade da Paz, Dili, Timor Leste 4. Fernando Diaz Gusmao, Amd., S.IP., MAP., Universidade da Paz, Dili, Timor Leste 5. Rosinho da Crusz, Lic.Dir., M.Dir., Universidade da Paz, Dili, Timor Leste 6. Dr. Wirawan Endro Dwi Radianto, S.E., M.Sc., Ak Universitas of Ciputra Surabaya 7. Dr. Trianggono Wiradinata, S.T., M.Eng., Sc. Universitas of Ciputra Surabaya 8. Damelina B. Tambunan, SE., M.M., Ph.D. Universitas of Ciputra Surabaya 9. Dr. David Sukardi Kodrat, M.M. Universitas of Ciputra Surabaya 10. Dr. Tina Melinda, M.M. Universitas of Ciputra Surabaya 11. Imam Wijoyo, S.E., M.M. STIE IBMT Surabaya
12. Prof. Dr. Nyoman Puspa Asri, M.S. University of W.R. Supratman Surabaya 13. Irwan Yulianto, S.H., M.H.
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The Fourth International Conference on Entrepreneurship | Book Two
University of Abdurachman Saleh Situbondo 14. Dr. H. Pribanus Wantara, Drs., M.M. University of Trunojoyo Madura 15. Dr. Ir. H. Sundjoto, M.M. STIE Mahardhika Surabaya 16. Dendi Sean T. Indonesia Marketing Association Chapter Surabaya 17. Dr. Muhammad Alkirom Wildan, S.E., M.Si. Insan Doktor Ekonomi Indonesia Surabaya
18. Drs. Eko Wahjudi, M.Si. University of State Surabaya 19. Gabriel Neves Institute of Business, Timor Leste 20. Lucio M. Gomes East Timor Coffee Institute
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The Fourth International Conference on Entrepreneurship | Book Two
Organizing Committee Chair
: Miguel Lucas Lay Costa, SE., M.M.
Universidade da Paz
Secretary
: Manuel Gonvalves Lic. Eco, M.M..
Universidade da Paz
Co-Secretary
: Fransisco Vicente Lic Eco, M.A.
Universidade da Paz
Treasury
: Manuel Loe Siga Lic Eco, M.M.
Universidade da Paz
Co-Treasury
: Faustina da Costa Lic, CSH
Universidade da Paz
HELD BY UNIVERSIDADE OF dA PAZ DILI COLLABORATED WITH 1.
University of Ciputra Surabaya, INDONESIA
2.
University of Trunojoyo Madura, INDONESIA
3.
STIE Mahardhika Surabaya, INDONESIA
4.
University of W.R. Supratman Surabaya, INDONESIA
5.
STIE IBMT Surabaya, INDONESIA
6.
University of Abdurachman Saleh Situbondo, INDONESIA
7.
University of State Surabaya, INDONESIA
8.
Insan Doktor Indonesia Surabaya, INDONESIA
9.
Indonesia Marketing Association of Chapter Surabaya, INDONESIA
10.
Institute of Business, TIMOR LESTE
11.
East Timor Coffee Institute, TIMOR LESTE
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REVIEWER 1. Prof. Drs. Tatang Ary Gumanti, M.Buss. Acc., Ph.D University of Jember. 2. Prof. Dr. Ir. Hening Widi Oetomo, M.M., Ph.D. Sekolah Tinggi Ilmu Ekonomi Indonesia Surabaya 3. Prof. Dr. Lucas da Costa, SE., M.Si Da Paz Universidade, Timor Leste 4. Dr. Tina Melinda, Dra., M.M. Universitas of Ciputra Surabaya 5. Prof. Dr. F. Danardana Murwani, M.M University of State Malang 6. Dr. Christina Whidya Utami, M.M. University of Ciputra Surabaya 7. Dr. David Sukardi Kodrat, M.M. University of Ciputra Surabaya 8. Dr.Tommy Christian Efrata, S.E., M.Sc. University of Ciputra Surabaya 9. Dr. J.E. Sutanto, M.M. University of Ciputra Surabaya 10. Prof. Dr. J.G. Nirbito, M.Pd University of Ciputra Surabaya 11. Jose Cornelio Guterres, Ph.D
Universidade da Paz, Dili, Timor Leste
12. Dr. Elidio de Araujo, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste
13. Dr. Augusto C Soares, S.E., M.M Institute of Business, Timor Leste 14. Dr. Adolmando Soares Amaral, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste
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15. Dr. Alex Pires, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste
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KEYNOTE SPEAKERS 1. Dr. Charles Chow East-West Management University, Singapore 2. David S. Dixon University of New Mexico, USA 3. Dr. Amir Shaharuddin Universiti Sains Malaysia, Malaysia 4. Prof. Dr. Lucas da Costa, S.E., M.Si. Universidade da Paz, Timor Leste 5. Dr. Ir Denny Bernadus, M.M. Ciputra Education Foundation, Indonesia 6. Dato Dr. Kim Tan Advisor, TBN Asia; TRUSTEE, TBN UK
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TABLE OF CONTENTS 1
Michelle Clarizza, J.E. Sutanto
2
1
Sassia Gezzari, 2David Sukardi Kodrat 1
Andre Prima Suranta 2
Surbakti, Denny Bernardus 1 Miftakhul Arifin, 2Tina Melinda
The Influence of Product, Price and Promotion Toward the Satisfaction of Business Customers of Toko Naga Emas Surabaya Branch Study of Business Feasibility of Gezzari Dental Clinic in East Jakarta Marketing Mix Strategies in Influencing Cutomer Satisfaction and Loyalty at Cv Anugrah Jaya
Analysis of Importance – Performance Attributes on the Housing Project of PT. Mitra Cipta Property as Input for the Development of Customer Value Orientation Housing Concept 1 Hermand Michael Analysis the Effect of Compensation Tulung, 2Denny Bernardus and Motivation on Employee Performance Through Job Satisfaction in PT. Bersih Bijak Sejahtera 1 Evi Thelia Sari Create Wealth Like a Marketer and Maintain it Like A Manager: Intrapreneurial Spirit in Practice 1 Wike Laurenzia Warrauw Kedai Notjap Business Plan With Canvass Business Model 1 Geovanni Garias Feasibility Study of Extra Neutral Alcohol Pradhana, 2Christina Development at PT. Energi Agro Nusantara Whidyautami 1 Maya Ida Kesumawatie, Role Stress And Work-Family Conflicts in 2 Miya Dewi Suprihandari Life Satisfaction Among Fishermen in East Java Province 1 Mira Farina Kusuma The Effect of Products, Services Quality And Dewi, 2Tina Melinda Price on Consumer's Purchase Intention on Mellocreme Clothing Product of Online Shop 1 Mohammad Habibul Feasibility Study Vannamei (Litopenaeus 2 Ghoni, J.E.Sutanto Vannamei) Shrimp Farming Business Establishment in Rembang 1 Nanik Kustiningsih Optimazing Accounting Information System by Using Six Sigma Dmaic Method to get Financial Benefit (Case Study PT. Philips Indonesia - Surabaya) 1 Stephanie Lauren Tessie, 7p Marketing Strategy Towards Customer 2 Denny Bernardus Satisfaction And Loyalty at Fitness Center X on Surabaya
1
12 27
35
44
52
64 69
76
82
88
100
112
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1
Didit Setyo Nugroho, Tommy Christian Efrata 1 Eni Wuryani 2
1 2
Mohammad Idhom, Ronggo Alit
1
Rheza Fernando Wibisono, 2Charly Hongdiyanto 1 Sherly Wijaya, 2Tommy Christian Efrata 1
Sugiarto, 2Chrystia Aji Putra 1
Lavinia Nova Lukito, Trianggoro Wiradinata 1Lucya Kumala Sari, 2Hermeindito 2
1
Erine Raharjo, 2Tommy Christian Efrata 1
Ambrosius Wishaldi Limiadi, 2David Sukardi Kodrat 1 Eduardo Sugiarto 1 2
Alexander Wirapraja, Imam Wijoyo
1
Handy Aribowo, 2Erni Halim 1
Arya H. Satmata, 2Tommy C. Efrata
X
Marketing Strategy Design in PT. Mitra Jasa Engineering Using Swot And Qspm Methods The Ability of Cash Flows Statement in Predicting The Profit of the Go-Public Companies The Development of Final Exam Registration Information System (Sipuan) as The Idea of Entrepreneurial Information Technology
124
The Marketing Strategy for the Growth of Beu Photography and Videography Using 7p
154
Determining Sop in Billing System and Receivable Payment Based on Customer Relationship Management Strategy With Qspm Method For UD Semangat Baru Developing Information Research System And Community Service (Sirip) Using Lean Startup Approachment Penerapan Strategi Aida Berbasis Online Terhadap Penjualan Produk Crispymunch Determining A Suitable Promotional Mix For Silk- Printing Industry R-R to Raise the Business’ Turnover The Effect of Brand Image, Perceived Product Quality and Recommendation (Electronic Word- Of-Mouth) Toward Purchase Intention Of X Designs’ Wedding Invitations Products Descriptive Analysis of Job Satisfaction, Employee Engagement, and Organizational Commitment in Xmg Real Estate Broker The Effects of Product Quality and Service Quality on Loenpia Nyonya Giok’s Consumers Satisfaction In PTC Risk Management Analysis in Determining the Level of Trust of the Clients Who Uses The Delivery of Goods Through Online Application. (A Case Study of Delivery Service Using Go-Send) The Implementation of Knowledge Management for the Profession of Management Consultant The Effect Factors of Attitude Toward Behavior, Subjective Norm and Perceived Behavior Control on Intention of Stock Investment By Individual Investor in Jakarta
162
132
148
171
178 187
192
202
209
218
228
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Kartikasari Gunawan, Factor Analysis of Student’s Startup Business Thomas Stefanus Kaihatu Execution in Ciputra University 1 David Sukardi Kodrat Balancing Business Dimensional and Family Dimensions in Family Business: Ownership Approach 1 Laksa Adi Hanom Effect Of Employee Motivation, 2 Tengtarto, Trianggoro Organizational Culture and Leadership on Wiradinata Employee Performance PT. L 1 R.M Moch Wispandono, Analysis of International Migrant Workers 2 Makhmud Zulkifli, 3Eni (Case Study of Worker of Madura Origin) Sri Rahayu N, 4Deni Setya Bagus 1 Randi Andika Hutama, Feasibility Study of Human Resources 2 Denny Bernardus Information System Application in Pmc Hospital Jombang 1 Feasibility Study of Establishing Re:Do Reynaldo Febrianto Architect Firm in Surabaya Iskandar 1 Kadek Ayu Windasari Market Segmentation Analysis With Cluster Analysis Approach of Cuci House Laundry 1 2 Khusnul Qotimah, Tina Formulation of Good Family Business Melinda Governance for Company Sustainability (Case Study on Cv K) 2
244 256
262
269
280
286 296 301
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THE INFLUENCE OF PRODUCT, PRICE AND PROMOTION TOWARD THE SATISFACTION OF BUSINESS CUSTOMERS OF TOKO NAGA EMAS SURABAYA BRANCH 1
2
Michelle Clarizza, J.E. Sutanto♠ Ciputra University Surabaya INDONESIA
Emails:
[email protected] ,
[email protected] ABTRACT This research aims to determine the influence of three variables – product, price and promotion, to the business customers’ satisfaction of Toko Naga Emas, Surabaya branch. The population of this research is 59 individuals who are business customers of Toko Naga Emas, Surabaya branch. The sampling method used is census where all 59 individuals are respondents of this research. This research uses multiple regression with three independent and one dependent variables. The result of processed data shows that all three variables – product, price and promotion, simultaneously influence business customers’ satisfaction significantly. However, partially, only product and price significantly influence the business customers’ satisfaction with the strength of influence according to aforementioned order. Keywords : paint industry, product, price, promotion, customer satisfaction, regression analysis INTRODUCTION Indonesia is one of Asia’s developing countries with indisputable economic growth, as mentioned by World Economic Forum (WEF). In its research regarding the Global Competitiveness Index, in 2013 Indonesia attained the 34th position in the international markets’ listings (Prasentiantono, 2014). Moreover, in November 2015, PricewaterhouseCooper published a journal titled “Riding Southeast Asia’s Automotive Highway”, in which it was mentioned that Indonesia, together with Thailand, are considered as the largest automotive markets in Southeast Asia, be it on production, consumption and export prowess. In relation to that, the automotive industry in Indonesia is a lucrative market consisting of many different complementing and supplementing industry inside, such as raw metal and plastic, automotive reparation, automotive customization, et cetera. Paint and Coatings industry is one of them. In 2014, the world’s research institution released a document where Indonesia placed itself as the fourth largest country, which consumed volume paint and varnish. Consuming as much as 877.459 ton of paint related products.
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One of the enduring players in Indonesia’s Paint and Coating’s industry, especially in Surabaya, is Toko Naga Emas. Established in 1988 by Mr. Erwin, Toko Naga Emas grew to have six branches. Focusing in Surabaya and its surrounding towns, such as Sidoarjo and Mojokerto, each with its challenges and market differences, there are five categories of products and services offered by Toko Naga Emas that contributes to 84.8% of earnings. Table.1 Product and Services Contribution to Earnings Category Percentage (%) Paint 30.7 Putty 24.2 Varnish 13.6 Thiner 8.8 Mixing 7.5 Others 15.2 Naga Emas has two groups of market to cater to: end-user consumer market and businessto-business market. The Surabaya branch of Naga Emas focuses on the business-tobusiness market, as it comprises 70-80% of its total earnings. The business-to-business market includes paint distributors, retailers, garages and constructions laborers. Through target market selection and service product excellence, Naga Emas has enjoyed a steady increase in earning from 2005-2012. However, in 2013 the growth dropped as much as 4.4% and continued to plummet as much as 8.6% in 2015. To investigate this phenomenon, a preliminary survey that yielded interesting results had been conducted. The survey results showed significant reduction of business-to-business consumers on the affected years. Therefore in 2016, further study consisting of simple interview and unstructured open ended questions was done to find variables and motive that causes the reduction of purchase frequencies. The responses were then categorized to elements of Product, Price, Place, Promotion and others. Table.2 Variable that causes Reduction on the Business Consumer’s Purchase Frequency Category Percentage (%) Product 53.33 Price 46.67 Promotion 40.00 Place 13.33 Others 13.33 The survey has shown that the reduction of business consumer’s purchase frequency is largely caused by three elements, Product, Price and Promotion. Thus, the variables must be further examined in order to find more detailed evidence that these elements are indeed the deciding factors that have huge impact to customer satisfaction of business-to-business customers. LITERATURE REVIEW Previous Research To further cement the foundation of this study, several similar researches are used as references. One is a research done by Alelign and Rao (2014) that titled “The Impact of Marketing Mix on Customer Satisfaction: A Case of MOHA Soft Drink Industry S.C.,
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Hawassa Millenium Plant”. This particular research was done to see the effect of 4P marketing mix towards customer satisfaction. With total sampling of 80 customers out of 542 population size using the stratified random sampling method, this research used Pearson Correlation Analysis and Regression Analysis to process its data. The result of this research found that the marketing mix significantly explains 59.2% of the overall customer satisfaction. Whereas the Regression Analysis showed the percentage of how much each marketing mix variables explains the customer satisfaction. This case yields a result where that Place variable explains 45%, Promotion explains 34.8%, Product variable explains 29.9% and Price variable explains 29.8% of customer satisfaction (Alelign and Rao, 2014:59-72). Another research used as reference is the “7Ps Marketing Mix and Retail Bank Customer Satisfaction in Northeast Nigeria”. Similarly, this research used quantitative analysis to process 415 questionnaires spread proportionally in Northeast Nigeria. The research showed that Product, Process and Physical Evidence variables significantly affected the customer satisfaction, while the remaining four variables (Price, Place, Promotion and People) did not significantly affect customer satisfaction (Mohammad, 2015:71-88). The third research used as a reference is titled “Marketing Mix: Its Role in Customer Satisfaction in the South African Banking Retailing”. Aimed to observe the role of the 4Ps of Marketing Mix as a tool to maintain customer satisfaction, the population of this study is the whole customer base of the four largest banks in South Africa’s retail banking sector. Using cross tabulation and descriptive statistics analysis, this research yield result where the Price variable holds the highest position in achieving customer satisfaction (36.36%), followed with Product (24.24%) and Promotion (22.73%) (Ateba et al., 2015: 83-91). The three published journals above were used as reference points for this study, as additional factor to decide what research method, sampling method and analysis to be used. Theoretical Background Definition of Business-to-Business Customer According Ranade (2012), customers are those who bought or consumed products in the form physical good or services and have the freedom to choose from an array of products and seller. Thus, Business-to-Business Customers are customer who acts as an intermediary to the end users. In the case of Toko Naga Emas, business customers are consumers who make purchases at least twice per quarter with minimum total purchase of IDR 3.000.000 a year. Product Kotler and Armstrong (2012:236) stated that Product is anything that can be offered to the market to attract attention, cause acquisition or consumption that can satisfy a demand or need. The characteristic of Product can be seen further from Product Quality, Product Features and Product Design. Price Price is the value to be paid or sacrificed by the customer in order to attain the product or services offered (Venter and Rensburg, 2011:260). Collins and Parsa (2006)) in Nuseir and Madanat (2015) stated three commonly used pricing strategy used with the purpose of increasing customer’s satisfaction. These includes: Cost-Based Pricing – where one calculates the total cost and marks it up according to the sought after profit margin; Customer-Driven Pricing – where one analyzes the spending capacity of the target market and adjust the price of the product to the purchasing power of the customer; MarketDriven Pricing – where one uses the pricing of other similar product or services already available in the market as a benchmark to decide on the price.
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Promotion Promotion is a tool for a company to communicate the value of product and services. It can be directed either to the potential new customers (Drummond and Ensor, 2005 in Ateba et al., 2015) to entice them into considering to utilize the offered products or service or to the existing customers with the intention for them to keep using the product or service offered and increase their consumption level. Promotion can be done through many different ways and media, those including but are not limited to the use of sales force, public relations, sales promotion in the form of discounts, direct marketing, word of mouth and point of sales display (Shankar and Chin (2011) in Ateba et al. (2015). Customer Satisfaction Oliver (1997) in Erjavec (2014) defined customer satisfaction as the result of customer’s cognitive and emotional evaluation to the experience of the product and services. Customer satisfaction is an assessment that the attributes or characteristics of a product or service have achieved the level that invokes pleasurable emotion. Erjavec (2014) in his study stated several manifestations that can indicate customer satisfaction. Those are customer satisfaction as a whole, estimation on expectation fulfillment and comparison with ideal product or service, (Fornell et al.,1996), positive review on product or company (Boulding et al., 1993), willingness to recommend to others (Pasuraman et al.,1988) and loyalty to product or company as time goes by (Rust and Zahorik, 1993). RESEARCH METHODS Data Gathering Methods The purpose of this research is to find the specific cause of one or more thing, this research is considered as a causal research, as defined by Sekaran and Bougie (2010:70). Using quantitative method, this research utilizes data gathered from a population of 59 Naga Emas Surabaya’s recorded business-to-business customers in the year-end of 2015. As the amount of population is not large, the entirety of the population is surveyed which will yield results with minimal error. As it uses as it uses the whole population as sample, this sampling method is called census sampling (Sugiyono, 2012:92). The data is collected using questionnaires, which uses 5-point likert scale for its scaling method. The respondents are asked to select one out of five responses for every question. In accordance with Kuncoro (2009:179), the five responses are scaled from the lowest to the highest as follows: 1. Very Disagree; 2. Disagree; 3. Quite Agree; 4.Agree; 5. Very Agree. This research uses two types of variables, Independents Variable and Dependent Variables. There are three Independent Variables (X) used Product (X1), Price (X2) and Promotion (X3). Each variable have indicators assigned to it, which are selected based on theoritical background, Naga Emas business practice and other supporting data. The independent variables and its respective indicators are shown in Table 3. Dependent Variable (Y) in this research is the customer satisfaction which indicators are mainly based on researches of Reichheld and Sasser (1990) and Rust et al. (2000) in Nuseir and Madanat (2015), such as: • Satisfied with the purchase experience in Toko Naga Emas • Will do repeat buying in Toko Naga Emas • Will recommend Toko Naga Emas to relations and/ or business colleague • Will make Toko Naga Emas as the first choice to shop
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Table.3 Independent Variable and Indicators • Product offered suits the need of customer (a) • Products are varied (b) Product (X1) • Products bought are functioning properly (c) • Sold products are in good condition (b) • Store has sufficient stock of goods (b) • Price is worth the quality of the product (d) Price (X2) • Price is worth the quantity of the product (d) • Price of products reflects the given service (e) • Price is competitive (d) • Shopkeeper have sufficient product knowledge to assist in purchase decision (g) Promotion • Shopkeeper informs promotional information (whether there (X3) are new products or price amendments) (f) • Shopkeeper is maintaining good relationship with customers by keeping contacts (through telephones or other media) (f) • Store sign is giving off clear information (d) • Store gives out appreciation for loyal customers (gifts, souvenirs, gimmick, etc) (b) Theoretical Background: a) Kotler and Armstrong (2012) b) Alam and Faridi (2014) c) Kotler and Armstrong (2010) d) Probosuci, Deoranto and Santoso (2014) e) Venter and Rensburg (2011) f) Shankar and Chin (2011) in Ateba et al.(2015) g) Niharika (2015) Data Analysis Methods Reliability and Validity Test The gathered data are put through reliability test to measure the reliability of variables in the questionnaires. A questionnaire can be considered as reliable if the answer of respondents are always consistent and stable from time to time (Ghozali, 2012:47). A quantifiable value of this can be seen from the value of Cronbach Alpha. If the value of Cronbach Alpha of a variable is lower than 0.70 point, the independent variable is removed from independent variable pool. Validity test shows if the questionnaire is valid in measuring the concept researched (Sekaran and Bougie, 2010:157). This test is mainly seen through the value of significance (sig.) in Pearson correlation. Should it be discovered that the indicator’s sig. value is lower than 0.05, the indicator is considered invalid and is removed, Bivariate Linear Regression Analyiss The Bivariate Linear Regression is used to measure the influence of Independent Variable to Dependent variable, and by extension, predict the value of Dependent Variable based on Independent Variable. (Ghozali, 2012:96). This therefore, the Bivariate Linear equation for this research is: Ŷ= b0 + b1 X1 + b2 X2+ b3 X3 Where: Ŷ : Predicted Customer Satisfaction b0 : Regression Constant
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b1 : Product Variable Coefficient X1 : Product Variable b2 : Price Variable Coefficient X2 : Price Variable b3 : Promotion Variable Coefficient X3 : Promotion Variable Goodness of Fit Goodness of fit is required to reflect the accuracy of the regression function in predicting the value of the actual population. This includes checking three things: Coefficient of Determination (R2), F-Test and t-Test. The R2 shows how far the model is able to explain the dependent variable. The closer its value to 1, means that the Independent Variable in the model is able to completely explain the entire movement of Dependent Variable. F- Test measures if the Independent Variable simultaneously explains the Dependent Variable. If the sig. F value is lower than 0.05 then the Independence Variable simultaneously are significant influencers to Dependent Variable. The t-Test shows how far each Independent Variable at its own explains the Dependent Variable. If the t-Test results in sig. <0.05 then the Independent Variable independently influences Dependent Variable. Classical Assumption Test In order to verify the validity of Regression Analysis model and result, several other tests are done to ensure that the result is free from signs of multicollinearity, autocorrelation and heteroscedasticity. Moreover, the tests are done to ensure whether the residual is distributed normally as well as if the resulting model is suitable with linear model. An Autocorrelation test result is done to ensure that there is no connection between residual. This uses Durbin-Watson value to confirm. With sample number of 59, Independent Variable of 3 (k=3) and significance of 5%, lower threshold (dL) of 1,480 and upper threshold (dU) of 1,689 is attained (Meier, Brudney, dan Bohte, 2012:534). If the Durbin-Watson value (d) is larger than (4-dL) and less than the lower threshold (dL) then this indicates that there is autocorrelation in regression result. Heteroscedasticity test is then used to test if there are variance differences from the residuals. For this Glejser test is used. If the resulting number from Glejser test is higher than 0.05 (sig. > 0.05) then there is no heteroscedasticity and vice versa. Normality test is done through One Sample Kolmogorov-Smirnov (K-S), should the significance (2-tailed) is higher than 0.05 then the residual has normal distribution. Lastly, if the Linearity test yields result of sig. deviation from linearity higher than 0.05, it verifies that the regression model is linear. A good data is one that has linear relationship in between Independent Variable and the Dependent Variable. RESULT AND DISCUSSION The outcome of the preliminary test shows that one indicator from Promotion Variable (X3) must be left out, more specifically the “Store sign is giving off clear information” indicator. This is due to several point such as the low value of Corrected Item-Total Correlation of 0.302, and the low Cronbach Alpha point of 0.708, but most notably the increase of Cronbach’s Alpha Value if Item Deleted increase to 0.744. Other than this specific case, the remaining variables and indicators pass the Reliability and Validity test with no problem. Moreover, looking at the average result of each variable, the indicators of “Products bought are functioning properly” and “Sold products are in good condition” have the highest score for Product variable. Meanwhile, the indicator “Price of products reflects the given service” scores highest for Price variable and the indicator “Shopkeeper is maintaining good relationship with customers by keeping contacts (through telephones or
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other media)” scores highest for Promotion variable. For the dependent variable, the indicator “Will do repeat buying in Toko Naga Emas” scores highest in Customer Satisfaction variable. Looking deeper on the causal side of this research, the R square result is as much as 56.2% showing that the mix of Product, Price and Promotion could explain that much of Customer Satisfaction, while the other 43.8% is influenced by other variables that are not included in this research. However, the R square result does not mean that the independent variables are not of concern of Naga Emas Surabaya branch, since F test shows that the mix of those three variables altogether is significant in influencing Customer Satisfaction. Based on the t-test results, Product and Price are individually significant in influencing Customer Satisfaction. Meanwhile, sig. value for Promotion variable is bigger than 0.05, which means that Promotion is not significant in influencing Customer Satisfaction. The Bivariate Linear Regression resulted in an equation model where Customer Satisfaction (Ŷ) = 0,126 (b0) + 0,419 Product (X1) + 0,402 Price (X2) + 0,172 Promotion (X3). The model shows that the Product and Price Variables have more impact on the Customer Satisfaction dependent variable, each increases the value of Customer Satisfaction by 0.419 and 0.402 respectively for each point added. The Promotion Variable holds the least amount of impact to Customer Satisfaction with 0.172 points added to the Customer Satisfaction Variable for each added point. Managerial Implication Considering the results of the research, there are some things that can be improved for each independent variable. Below are the list of the pre and post actions that are executable instantly by Toko Naga Emas, Surabaya branch. Product Table 4. Managerial Implication of Product Variable Post Research Actions • Evaluate product variety, adding new products Product variety sold lay and removing old obsolete products stagnant for the last 5 • Additional display units is added to years increase capacity for wall paint • Construct monthly report focusing on the Restock is done if most paint color sold product has been sold • Minimal supply of one box each color to out ensure product availability Store product arrangement and • First In First Out (FIFO) stocking storage is left on the whim mechanism is used to ensure fragile and nonof shopkeepers sustainable products to be sold timely and orderly fashion Pre-Research
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Price Table 5. Managerial Implication of Price Variable Pre-Research Post Research Actions • Evaluate product pricing to adjust the prices based on the price sensitivity of each product Cost Based Pricing is used • Adding price cuts and bundling method on several goods which are more sensitive to price change • Cross subsidization will be applied to increase competitiveness Promotion Table 6. Managerial Implication of Promotion Variable Pre-Research Post Research Actions • Creating new store sign in to give clearer Obsolete Store Sign information for passerby and create further customer awareness • Evaluate effectiveness of different Eid al-Fitr promotional strategy, including wordComplimentary Gifts of- mouth promotion and e-marketing • Focus on customer centric marketing strategy in order to create customer intimacy, thus changes the nature of relation with customers from transactional to emotional. Some of the methods Promotional include: Information o Creating membership program with Dissemination added benefits to registered customers o Short-term marketing program such as Each 100.000 rupiah purchase give registered member 1 point that can be exchanged for interesting rewards Yearly or semiannual raffle with valuable rewards
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CONCLUSION The linear regression model shows that Product variable with the coefficient of 0.419 has the most impact on customer satisfaction. This result positively aligns with Alelign and Rao (2014) where product significantly influential and it is able to explain 29.9% of customer satisfaction. The similar result found as well in Mohammad (2015) and Ateba et al. (2015) where product contributes as much as 24.24% of customer satisfaction. It is further confirmed by some literatures stating that good quality of product contributes positively to the customer satisfaction (Selnes, 1993; Janda et al., 2002; Chumpitaz and Paparoidamis, 2004 in Islam, 2015). The second individually influential variable is Price with the coefficient of 0.402. This result is in line with Alelign and Rao (2014) where price can explain 29.9% of customer satisfaction. However, Mohammad (2015) in his research toward banking industry found that price is one of the non-influential variables. Yet, the result of Ateba et al. (2015) showed that price contributes highest influence toward customer satisfaction as much as 36.36%. Juwandi (2004) in Ghozali (2014) also emphasizes on the importance of price as a factor influencing customer satisfaction, especially for products that have high sensitivity to price change. The third variable is Promotion. Albeit the non-significant result in t-test, still promotion is a variable that must not be overlooked since it is the main variable in which the company can build emotional intimacy with its customers. Mohammad et al. (2012) in Abdullah khadim, Abdullah and Abdullah (2016) got the research results where promotion is not significantly influential toward customer satisfaction. In Ateba et al. (2015), promotion only contributes as much as 22.73% to customer satisfaction, which is the lowest contribution in that research. Those results are totally reversed in Alelign and Rao (2014) where promotion is the most influential variable and it is able to explain 34.8% of customer satisfaction. RECOMMENDATION FOR FURTHER RESEARCH Further researches can contribute both to the industry and to the academic world. Some of the suggestions that can be given are:
• • •
More variables can be added into the mix to increase the predictability of the dependent variable, such as: location, business processes, physical evidence, et cetera Following research can go in-depth about type of promotions suitable to be executed in business-to-business industry especially in paint and coatings industry Customer loyalty can be the focus of the next research, since many literatures describe loyalty, not satisfaction, as the source of profit for companies
REFERENCES Alam, T. dan Faridi, M.R. (2014) ‘A Study on Satisfaction, Perception and Expectation Level of Institutional Consumers Towards Paint Brands in Al- Kharj Region, Kingdom of Saudi Arabia’, European Scientific Journal, X (13), pp. 665 – 680.
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Alelign, D. dan Rao, E.D.B.P. (2014) ‘The Impact of Marketing Mix on Customer Satisfaction: A Case of MOHA Soft Drinks Industry S.C, Hawassa Milennium Plan’, International Journal of Academic Research, I (1), pp. 59 – 72. Ateba, B.B., Maredza, A., Ohei, K., Deka, P. and Schutte, D. (2015) ‘Marketing Mix: It’s Role in Customer Satisfaction in the South African Banking Retailing’, Banks and Bank Systems, X (1), pp. 83 – 91. Erjavec, H. S. (2014) ‘Does Customer Satisfaction Lead to Customer Loyalty in Banking Sector?’, Journal of Accounting and Management, IV (1), pp. 17 – 24. Ghozali, M. (2014) ‘Pengaruh Kualitas Pelayanan dan Harga Terhadap Kepuasan Pelanggan pada Expedisi di Surabaya’, Jurnal Ilmu dan Riset Manajemen, III (3). Islam, M.T. (2015) ‘Factors Affecting Customer Satisfaction on Berger Paints Bangladesh Limited’, Global Journal of Management and Business Research: E-Marketing, XV (9), pp. 23 – 40. Kotler, P. dan Armstrong, G. (2010) Principles of Marketing, 13th ed. Upper Saddle River, NJ: Prentice Hall. Kotler, P. dan Armstrong, G. (2012) Principles of Marketing, 14th ed. Boston: Pearson Prentice Hall. Kuncoro, M. (2009) Metode Riset untuk Bisnis dan Ekonomi. Jakarta: Erlangga. Meier, K.J., Brudney, J.L. dan Bohte, J. (2012) Applied Statistics for Public and Nonprofit Administration, 8th ed. Boston: Cengage Learning. Niharika. (2015) ‘Effect of Marketing Mix on Customer Satisfaction’, International Journal of Science, Technology, and Management, IV (1), pp. 73 – 81. Nuseir, M.T. dan Madanat, H. (2015) ‘4Ps: A Strategy to Secure Customers' Loyalty via Customer Satisfaction’, International Journal of Marketing Studies, VII (4), pp. 78 – 87. Prasetiantono, T. (2014)‘ Indonesia Jumps 4 Places in Global Competitiveness Index2014 – 2015. Available at: http://www.indonesiainvestments.com/news/todays-headlines/indonesia-jumps-4-places-in- globalcompetitiveness-index-2014-2015/item2381 (Accessed: 16 August 2016). Probosuci, K., Deoranto, P. dan Santoso, I. (2014) ‘Analisis Pengaruh Bauran Pemasaran Terhadap Loyalitas Pelanggan (Studi Kasus: Restoran Jepang Saboten Shokudo, Malang)’. Available at: http://skripsitip.staff.ub.ac.id/files/2014/08/Kustania-Probosuci.pdf (Accessed: 16 Agustus 2016). Ranade, K. (2012) ‘Customer Loyalty – What Is It? How Can You Measure and Manage It?’. Available at: http://www.loyaltyresearch.com/insights/ customer-loyalty-what-is-it-how-can-you-measure-and-manage-it/ (Accessed: 9 January 2017) Sekaran, U. (2010) Research Methods For Business. Jakarta: Salemba Empat. Sekaran, U. dan Bougie, R. (2010) Research Methods for Business: A Skill Building Approach, 5th ed. West Sussex, UK: John Wiley & Sons, Inc. Sugiyono. (2012) Metode Penelitian Administrasi. Cetakan Keduapuluh. Bandung: Alfabeta.
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Wijeratne, D. and Lau, S. (2015)‘Riding Southeast Asia’s Automotive Highway’. Jakarta: Publication PricewaterhouseCoopers(PwC). Venter, P. and Van Rensburg, M.J. (2011) Strategic Marketing: Theory and Application for Competitive Advantage. Cape Town: Oxford University Press Southern Africa (Pty) Ltd.
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STUDY OF BUSINESS FEASIBILITY OF GEZZARI DENTAL CLINIC IN EAST JAKARTA 1
Sassia Gezzari, 2David Sukardi Kodrat♠ Ciputra University Surabaya INDONESIA ABSTRACT
This study is conducted in Gezzari Dental Clinic, aimsing to find out the business feasibility of Gezzari Dental Clinic by analyzing law aspects, market and marketing aspects, technical and technological aspects, management and human resources ascpects, and financial aspects. Gezzari Dental Clinic is one of dental clinics located in East Jakarta that serves patients, especially Japanese people by using Japanese language-based to facilitate the patients and doctors in terms of communication. The approach used in this study is qualitative methods in which the researchers conduct the observation and interview with people who know the situation of dental clinic management in Jakarta. Whereas the sampling techniques is purposive sampling by determining the data source obtained from the one who has been interviewed and chosen by considering specific purposes. The data collection methods is done in the form of interview, observation, and documentation. The law aspects is used to analyze the license legality and business location. The market aspects is used to analyze the business environment using PEST analysis, the structure of the industry using Porter's Five Forces Model analysis and SWOT analysis. The market aspects is used to analyze the marketing target, segmenting targeting positioning and marketing mix. The technical and technological aspects are used to analyze the location, layout, and technology. The management and human resources aspects are used to analyze the organizational structure, job description and standard operation procedure of the service flow. Financial aspects is used to analyze the feasibility of investment using the method of payback period, net present value, and internal rate of return calculation, and risk analysis. Furthermore, this study confirms that legal aspects, market and marketing aspects, technical and technological aspects, management and human resources aspects, and financial aspects of Gezzari Dental Clinic is eligible. Keywords: Business, Feasibility, Dental Clinic, East Java INTRODUCTION Oral and dental health often becomes secondary priority for human. Meanwhile, it is an entrance for germ and bacteria so that they can disturb the health of other body organs. Based on Indonesia Basic Health Research 2007 and 2013, the percentage of people who have oral and dental problems has increased from 23.3% to 25.9%. According to those who have oral and dental problems, the percentage of people who get dental treatment has increased from 29.7% in 2007 to 31.1% in 2013. The DMT-D index describes the level of dental damage severity. It is the sum of D- T, M-T, and F-T index which shows that the amount of dental
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damage undergone by people, whether in the form of Decay/d (caries or cavity), Missing/M (removed tooth), and Filling/F (filled teeth). Indonesian DMF-T index in 2013 was 4.6% which means that tooth decay of Indonesian population reaches 460 teeth per 100 people. When it is compared to the index in 2007, DMF-T index was almost the same as in 2013 (i.e. 4.85%), which means that tooth decay of Indonesian population after 2007 was 485 teeth per 100 people as shown in the following figure:
Figure 1. Indonesia DMF-T Index 2007 and 2013 Source: Indonesia Basic Health Research 2007 and 2013 Without the level of good welfare and quality of life, people cannot get health facilities services as they need. The level of welfare and quality of society can be seen from the achievement of Human Development Index (HDI). The province with the highest HDI rank is DKI Jakarta. Availability of health, education, and economy as well as ease of access to all these facilities make DKI JAKARTA superior to human development achievements rather than the area outside of DKI Jakarta. Directorate General of the Ministry of Finance stated the number of Japanese citizens who are already registered as taxpayer at Tax Office Jakarta is the highest one compared to other countries. From the value of the tax payments, Japanese WP in belongs to the category of the largest contributor. From the origin country of WP in Jakarta, Japanese citizens most widely reached 4,028 taxes with its citizens’ income who work in Indonesia reaches Rp 1 billion per year. It is the data of taxpayer for strangers that makes optimism in terms of health to the target market of Japanese citizens. Considering the above data, it can be seen that the highest HDI and Japanese people that become the highest foreign tax contributors in Indonesia is JAKARTA. The achievements of the highest HDI in Indonesia has made DKI JAKARTA as a place for business opportunities in the field of dental health as well as to maintain the HDI of DKI JAKARTA. It is already high compared to other provinces in Indonesia, the demand for health services will increase. This opportunity becomes an incentive for public and private parties to invest in establishing health facilities. LITERATURE REVIEW Subagyo, in the feasibility study (2010), states that a feasibility study is in-depth research on a business idea about the feasibility of the idea to be implemented. A business idea is stated as ‘feasible’ if the idea can bring greater benefits for all parties than the negative impacts. In the feasibility study, the data are estimation data, external data sources, which aims to assess the feasibility of a business idea, take a relatively long time because it must use a variety of sources and require relatively large costs (Suliyanto, 2010: 3-4). Before implementing business idea, in-depth analysis of the legal aspects should be done so that the future business will not be fail due to the legal and licence issues. The legal aspect is an
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aspect that must be examined first. This is because if it is based on the analysis of the legal aspects a business idea is not feasible, then the process will not be necessary to continue with the analysis on other aspects. Markets are all potential customers who have specific needs or desires that might be willing and able to engage in the exchange process in order to satisfy the needs. Market aspects is analyzed to determine the estimated market demand health services. PEST analysis aims to observe changes in aspects of the PEST analysis so that it has impacts on the market placement in the global market. The presence of PEST analysis motivates an organization to be able to identify the opportunities and challenges that exist in the environment (Amalia, Samopa, 2012: 18-3,18-4). Porter stated that there are five competitive forces that affect the success of an industry. Those fiive power consist of threat of new entrants, the level of rivalry among competitors, substitute products, bargaining power of buyers, and the bargaining power of suppliers. (Riky, Mustamu, 2014: 2). Strategic marketing consists of three main steps, Segmenting, Targeting, and Positioning (Irene, 2010). In the health business marketing activities, marketers use certain tools to get the desired responses from the target market. These tools form a marketing mix or commonly called ‘Marketing Mix’. In analyzing the strategy of health care organization we can also perform a SWOT analysis (Strength, Weakness, Opportuniy, and Threat). If the market analysis and marketing showing a business idea is feasible, then the next step is to answer the question whether the business is operationally able to run or not. Things need to be analyzed on the technical aspects and the technology are its location, layout, and technology. The analysis of management and human resources of aspects aims to analyze the organizational structure, job description, and standard operating procedures service flow. The last aspect is the financial aspects by analyzing the return on invested capital on the basis of some analysis of the feasibility of investment, such as Payback Period (PP), Net Present Value (NPV) and Internal Rate of Return (IRR), as well as risk analysis. Conceptual Framework
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Analysis Model
RESEARCH METHODS Research Approach The research approach is qualitative research. Qualitative methods is a research method used to examine the condition of natural object, (as his opponent experiment) where the researchers are the key instrument, data collection techniques is conducted in triangulation (combination), data analysis is tinductive, and qualitative research results tends to emphasize the significance rather than generalization. Research Place and Date This research was conducted at prospective place of business for opening dental clinic in East Jakarta in May-June, 2016. Informant Determination According to Sugiyono (2015, 52), in qualitative research, researchers go to certain social situations, make observations, and interviews with people who are considered to know about the social situations. In this study the determination of the data source based on the interviewee is conducted using purposive sampling, i.e. he was chosen with consideration and specific goals. Here are the criteria informants of this research: - They are the owner/person in charge of the clinic/clinical dentist who is classified as being engaged or involved in investigational activities (aspect). - Those who are willing to be the volunteers and have sufficient time for questioning.
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Data Collection Aspect Law Aspects Agreement from local people Law consideration s from law consultant
Table 1. Data Collection Informant Data Source
Owner, Competitor, Law Consultant/Notar y / Local Government, local people
Primar y, Secondary data
Permission for practice and location
Techniques of Data Collection
Interview, Observation, Documentation Interview, Documentation
Primar
Market Aspects Business Environment
Owner, Competitor
Industrial Structure
Owner, Competitor
Interview, Observation, Documentation
SWOT Analysis
Owner, Competitor
Interview, Observation, Documentation
Marketing Aspects a. Market target
b. STP
c. 7P (Marketing Mix)
Technical and Technological
Own er Comp etitor
y, Secondary data
Primar y, Secondary data
Interview, Observation, Documentation
Interview, Observation, Documentation
Own er Comp etitor
Interview, Observation, Documentation
Custo mer Owne r Comp etitor
Interview, Observation, Documentation
Primar y,
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Secondary data
Aspects Location
Owner, Competitor
Layout
Owner, Competitor
Teknology for Dental Chair and Equipments Management and Human Resources Aspects Organizational Structure Title Description SOP Financial Aspects Investment Feasibilit y Analysis Risk Analysis
Interview, Observation, Documentation Interview, Observation, Documentation Interview, Observation, Documentation
Owner, Competitor
Owner, Competitor Owner, Competitor
Primar y, Secondary data
Owner, Competitor
Owner, Competito r, Expert
Observation, Documentation Observation, Documentation Observation, Documentation
Primar y, Secondary data
Owner, Competito r, Expert
Interview, Observation, Documentation Interview, Observation, Documentation
Source: Analyzed Primary Data (2016) Feasibility Criteria Table 2. Fasibility Criteria Types of Aspect
Fasibility Criteria (all aspects that must be stated ‘feasible’)
Law Aspects
- have STR dan SIP
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Market and Marketing Aspects
- able to consider the conditions of busines environment
using PEST analysis - able to consider the conditions of industrial structure
using 5 Forces Porter Model - able to determine SWOT quadrant of the company on
quadrant I and quadrant II. - able to analyze STP so that it will be suitable with the
Te c h n i c a l a n d Technological Aspects
market target, the company will get good image, and do market segmentations. - able to analyze Service Market Mix (7P) so that it can meet the needs of the customers in terms of the quality of services, prices, health service distributions, promotions, service operators, service physical environment, and service processes itself. - the selection of clinic location, layout of dentist practice room and waiting room, and toilet location so that the customers will get effective services. - the selection of technology which must consider the economical benefits for the business. - having determined the SOP clearly to do the treatment to
Management and Human Resources Aspects Financial Aspects
the patients. - having created the organizational structure well - having created the title description well - Payback Period (PP) < payback maximum ( 1 Tahun) - Net present value (NPV) > 0 (nol) - Internal rate of return (IRR) > level of desired income - Risk Analysis
Source: Analyzed Primary Data (2016) Data Analysis The data analysis will be done by analyzing every aspect of the various issues related to the above aspects. The analyzed aspects are legal aspects, markets and marketing aspects, and technical and technology aspects, management and human resources aspects, and financial aspects. Discussion General Description of Research Object Gezzari Dental Clinic is a startup business of dental clinic located in East Jakarta. It is a dental clinic that serves patients in general, both Indonesian and foreign citizens, especially Japanese people. Law Aspects Establishing a dental clinic in Indonesia requires a minimum of Certificate of Registration (CR) and Practice Permission (PP) for business licensing and locations to
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practice dentistry. If the form of clinics can take care of licensing pratama clinic, it can be run only with SR and PP for dentist's office. Market Aspects Business Environment Based on PEST analysis, it was obtained the results showing that there is opportunity and threat described as follows: Opportunity: 1. The government supports the development of dentists in serving and improving public health of Indonesia 2. Indonesian economy that continuously grows will affect the mindset in terms of health which then increases the purchasing power of society in terms of health. 3. Increased awareness of Indonesian people, especially Japanese citizens in Indonesia that will increase the arrival of people to the dentist to do a treatment for oral and dental health Threat: 1. Competition of technology Industrial Structure In analyzing the industrial structure the company uses five forces model of competition. It consists of the threat of new entrants, bargaining power of suppliers, bargaining power of buyers, the threat of substitute products, and competition in the industry and obtained from the average of each indicator of the Five Forces Porter Analysis of Gezzari Dental Clinic which will then be created Porter's Five Forces Analysis diagram illustrated as follows:
Figure 2. The Five Forces of Competition Model of Gezzari Dental Clinic Source: Analyzed Primary Data (2016)
SWOT Analysis SWOT Analysis of Gezzari Dental Clinic is included in quadrant I, which is a favorable situation in which the health care organization still has the opportunity and the power that can take advantage of existing opportunities. The strategy should be done in these circumstances is by supporting aggressive growth policies (Growth Oriented Strategy). This is done firstly by own target market, STP, and marketing mix with more detail, develop promotions by working with companies and insurance, increasing the number of branches closer to the location of the companies that employ many employees of Japanese citizens.
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Quadrant III (WO) “Turn Around”
Quadrant I (SO) “Agressive” (12,2)
Quadrant IV (WT) “Defensive”
Quadrant II (ST) “Diversification”
Figure 3. SWOT Analysis Source: Analyzed Primary Data (2016)
Market Target In 2014, health business which includes hospitals, laboratories, pharmacies, beauty clinics, pharmaceuticals, medical devices, health insurance, etc., is growing rapidly with market size in 2014 of around Rp 340 trillion. Segmenting, Targeting, dan Positioning (STP) Conducting STP analysis to select three segments of the ministry of Japan-Minded behave in positive way, ensuring Japan-Minded that behave in neutral, and giving services of JapanMinded negative behaviors, analyzing targeting in more detail, i.e. employees of companies in Jabodetabek area who are citizens of Japan, and positioning with the tagline "Your Time and Happy Smile is Our Priority" Marketing Mix Conducting analysis of the marketing mix in detail, i.e. the product of tendodontic treatment and conservation with Japanese language services and quality assurance of materials and the best materials. Prices for consumers in accordance with the service and complement obtained from the patients. The location is in East Jakarta with easy access to other Jabodetabek area via toll. Offline promotion is provided by installing nameplate clinic and the name of the dentist in front of the clinic, the cost of free consultation including the picture of patient's teeth on his first visit as the medical records, the presence of photo spot for Japanese people to be provided for kimono and hakama. Making educational videos of teeth and mouth which will be shown in television of the waiting room, as well as promoting cooperation with Japanese companies in Jabodetabek and obtaining the patient's insurance company. People (in the form of admin) will wear yukata, while the doctor wears a suit of Japanese women clothes that are comfortable, so it will still provides effective treatment and Japanese atmosphere. Doctors take care in accordance with the appointed hours, that is to always provide timely service according to the time that has been made and the services is fast and efficient. The ability of doctors, nurses, and administrators who can speak Japanese to be more value more. Physical evidence is divided into a lounge area and a very comfortable treatment. Atmosphere clinic is air conditioned room, a comfortable waiting room for patients who are waiting for treatment and for the introduction of the patient, in the waiting room
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there are tables for re-registration of patients and seat sofa Japanese style, the spot for the photobooth that with their Japanese Gate small version, tree cherry blossoms kimono costume and displays that can be created spots for patients taking photos. The door to the ward by using sliding doors as in Japan and the habit of replacing footwear with footwear that has been provided when entering the treatment room. Atmosphere's office can be explained from the patient into the treatment room and the right side will consult and diagnose before starting the treatment, in addition to table consultations are dental chair facing his back to the table consultation and facing out the window towards the south where outside the windows as well there are views of trees cherry blossom so that at the time of patient care can be while seeing the sights of cherry blossoms and there is a television/monitor that becomes one with the dental chair to also show video views of the cherry blossoms as in gardens in the spring in Japan complete with audio that will provide more lively impression of the spectacle. Aroma therapy is in accordance with the distinctive aroma in Japan. Audio sounds of Japanese music in the waiting room and treatment rooms. Room wall that surrounds the room will be made separti walls that exist in Japan which can be a timber and rich with papers, clinic room floor also made of wood such as Japanese houses. Spacious parking area also support Gezzari provide comfort Dental Clinic in patients who took the car as transportation. Process service that is timely, effective, and efficient. The process of service here discuss the service flow starting doing maintenance agreements both with booking online on the website and booking by telephone on schedule agreements patient and the clinic, after booking a treatment at least one day prior to treatment and the patient came to the clinic for re-registration and immediately diagnosed as well as treatment, after treatment ends with the control/ maintenance periodically in accordance maintenance that will be carried out. Technical and Technological Aspect Location The clinical location is in Jalan Rambutan, Kapin, Kalimalang located in East Jakarta, the border of West Java including Jakarta, Karachi, Cikarang which is an industrial park area where there are lots of companies and factories from Japan, which employs the employees of Japanese citizens as well, so that the location of our clinic is very affordable for Japanese employees if they want to get dental and oral treatment. Besides, it is quite close to the place they work, thus they do not need to be in downtown of Jakarta. Layout Our dental clinic is divided into administrative space and maintenance space with the total size of 8,5m x 4.5 m as well as a lounge area and a cafe in the form of fishing in the boutique downstairs and upstairs, a large car park that can accommodate more than 5 cars and there there is an entrance gate to the clinic building in the form of Japanese gate.
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Figure 4. Waiting room design Source: Internal data (2016)
Figure 5. Treatment Room Design Source: Internal data (2016)
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Figure 6. Treatment Room Design Source: Internal data (2016) Technology The technology for the selection of dental chair and equipments as well as other material for patients treatment will use standard technology based on the needs of patients, and it should have economical benefits without reducing the quality of services. Management and Human Resources Aspects The organizational structure of Gezzari Dental Clinic is led by the head of the clinic, who led financial administration, services and operations that consist of reception area in the form of cafes and boutiques as well as part of the security, cleanliness and maintenance
Figure 7. Organizational Structure Source: Internal data 2016 It has been analyzed every job description based on the organizational structure of Gezzari Dental Clinic and standard operating procedures that will be used as a service flow:
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In the waiting room: - The patients directly come to do re-registration in accordance with the schedule. - Scheduling for the patients that can be done via phone and online at the website. In the practice room: - The nurse will prepare the room and tools, cleaning tables, chairs and dental units, prepare sterile diagnostic tools and materials/medicines for dental treatment, turn on the compressor, check whether the drill can function properly or not. - The doctor and nurse do universal precautions during the treatment. - The test for patient examined by the dentist is the primary and supplementary anamnesis, basic and supplementary examination, diagnosis, treatment plan and tell the patient what treatment will be given following the percentage of the results of treatment, and treatment as well as final instructions after treatment. If the patient treatment requires control, then the patients will be told to come the next day as needed control based on the number of days and times they must come to control back. Financial Aspects The last aspect described in the feasibility study is financial. Here are the company's internal data in the form of balance sheets and profit and loss projections. Financial analysis has been found that the company will be able to recoup the investment after 8 months, 5 days, 12 hours, 42 minutes with NPV of Rp 1,356,649,166 and IRR of 158.12%, as well as risk analysis showing that low risk of deviation of the best NPV results that is expected to obtain. Conclusion and Suggestion Conclusion After conducting research and analysis on the feasibility study of Gezzari Dental Clinic, it can be drawn the conclusion as described follows: 1. Based on the environmental aspects of the business that uses the PEST Analysis, it can be said that the conditions in Indonesia to support the business of Gezzari Dental Clinic. In PEST analysis results, it has been obtained the opportunities and threats as follows: the government that supports the development of dentists in serving and improving the health of Indonesian people, Indonesian economy conditions will continuously grow little by little and will affect the mindset in terms of oral and dental health which then it will increase the power of public purchasing in terms of health, increasing awareness of Indonesian people, especially Japanese citizens in Indonesia that will increase the arrival of people to dentist in order to continuously do oral and dental treatment, as well as technology competition. 2. Based on the structural aspects of industry using Five Forces Analysis, it can be said that the position of Gezzari Dental Clinic is placed in pretty good competition. It shows the results of the strengths and weaknesses as follows: licensing for individual practice permission (easy), quick turnover, target of Japanese people, services of Japanese oriented, in collaboration with Japanese companies and insurances, each brand is sold only in one dental depot, the continuing increase of new clinics and dentists every year, and the legalization of dental technician profession. Based on the analysis of environmental aspects of business and industrial structural aspects, the company applies SWOT analysis of strengths, weaknesses, opportunities, and threats owned by Gezzari Dental Clinic. The results is included in quadrant I, which is a favorable situation in which the health care organization still has the opportunity and power that can take advantage of existing opportunities. 3. The market and marketing aspects indicate that market growth of healthcare industry in Indonesia has grown rapidly with the market size in 2014 was around Rp 340 trillion.
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Gezzari Dental Clinic has met the criteria used in the market and marketing aspects that are: market potentials to be developed, have certain consumers, as well as STP and Marketing Mix. 4. On the technical and technology aspects, the company analyzed the location, layout, and technology. Gezzari Dental Clinic has met the evaluation of technical aspect indictors and technological aspects of the location that is easy to reach, efficient clinics layout, and technology that is suitable with the needs of the patient. 5. On the management and human resources aspects, Gezzari Dental Clinic has had a good organizational structure, creation of job description for each employee, and good establishment of SOP services flow. 6. On the financial aspects, Gezzari Dental Clinic used Payback Period (PP), Net Present Value (NPV), Internal Rate of Return (IRR), and risk analysis indicators. Based on the calculation results of the feasibility study, it shows that the PP is obtained in 8 months, 5 days, 12 hours, 42 minutes, NPV of Rp 1,356,649,166 and IRR of 158.12%, and scenario analysis obtained on the first, second, and third-risk has low risk toward the deviation of the results of best NPV as expected to obtain. Suggestion In addition to the above conclusion, the authors also provide suggestions for determining further action on feasibility study of Gezzari Dental Clinic described as follows: 1. Gezzari Dental Clinic can increase its marketing to continuously improve the results of treatment, periodically update the latest technology, more aggressive promotions of cooperation with Japanese companies in Indonesia, innovate in making the clinic to be more attractive as clinics which resemble Japanese clinic, improve the service quality and service processes as comfortable and effective as possible. Therefore, it is able to improve service quality and serve the patients as much as possible. 2. Gezzari Dental Clinic (in terms of financial) needs to use existing resources, especially capitals in the form of money that can be used effectively and efficiently so that it can be used to support the company in achieving its performance target. 3. The related company should do better observation for future research, because by doing such observation, the company can determine the actual market conditions well in order to be fit in pursuing selected strategies.
REFERENCES Amalia, Nahda., Samopa, Febriliyan. (2012), Startegic Planning of SI/TI (Case Study of Social Empowerment Office Gresik Regency. National Seminar on Technology Management XVI, P. C-18-3, C-18-4. Diana Sari W., Irene. (2010) Management on Health Busines Markets. Yogjakarta: Nuha Medika. Herlambang, Susatyo & Murwani, Arita. (2012) Management on Health and Hospital. Yogyakarta: Gosyen Publishing. Hidayat, Lukman., Puspitasari, Ratih. & Tantina. (2011), Analysis of Sensitivity as the Main Factors in Investment Decision Making. Scientific Journal of Ranggagading, XI (2), p.7. Infodatin. (2014). Data and Information Center of Health Ministry. Jakarta: Health Ministry of the Republic of Indonesia Kim, W. Chan & Mauborgne, Renee. (2005)Blue Ocean Strategy, Abdullah, Kurniawan. (editor) (2015) Wahono, Satrio. (Penerjemah) (2015) Samudra Biru Startegy. Jakarta: PT Serambi Ilmu Semesta. Pp: 20-53.
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Riky, Alfonsus., Mustamu, Ronny. (2014), Porter Five Porces Model on PT. RUCI GAS. Agora, Vol. 2, p.2. Ruri et al., (2015), Feasibility Analysis of Brance Opening of Hasri Medika Clinic in Tangerang analyzed from Market Aspects, Technical Aspects, Financial Aspects, Law Aspects, and Environmental Aspects. Pp: 1-8. Saiful et al., (2013), Analysis of Financial Risk Using Monte Carlo Simulation Method. Research of Fakulty of Enginering, Vol. 7, p.2. Sugiono. (2015) Understanding Qualitative Research. Bandung: Penerbit Alfabeta. Suliyanto. (2010) Study of Business Feasibility. Yogyakarta: CV Andi Offset. Sunyoto, Danang. (2014) Study of Business Feasibility. Yogyakarta: Center of Academic Publishing.
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MARKETING MIX STRATEGIES IN INFLUENCING CUTOMER SATISFACTION AND LOYALTY AT CV ANUGRAH JAYA 1
Andre Prima Suranta Surbakti, Denny Bernardus♠ 2
Ciputra University Surabaya INDONESIA 1
2
Emails:
[email protected],
[email protected]
ABSTRACT This research was conducted in CV Anugrah Jaya Surabaya, with the aim to determine the right 4P marketing strategy for CV Anugrah Jaya. The research used is qualitative with descriptive approach. The number of informants in this study were 5 people with the detail of 3 consumers CV Anugrah Jaya who bought goods at least more than three times, marketing from CV Anugrah Jaya and An Expert in the field of retail. Whereas, the data were analyzed by using descriptive technique which uses more details from interview result and documentation study. The results of this study were in the form of marketing strategy, such as (1) In aspect of product CV Anugrah Jaya is expected to ensure the availability of the products most often purchased by the customer and maintain quality in order to reduce complaints from customers (2) In aspect of price consumer CV Anugrah Jaya said that the price Which is offered is still more expensive and expected CV Anugrah Jaya always consistently provide a cheap price to always get the hearts of consumers (3) In aspect of Place CV Anugrah Jaya need to make improvements in the delivery so as to reduce the delay and felt necessary to have their own warehouse (4) CV Anugrah Jaya still felt less give promotional activity because during this time they just do direct selling. Keywords: Mixed marketing, 4P Marketing strategy (Price, Place, Promotion, dan Product) INTRODUCTION The metal industry is categorized as one of the upstream industries targeted by the Ministry of Industry of Indonesia for development in the National Industrial Development Master Plan Year 2015-2035. The business potential of the metal processing industry has a bright prospect as it is a strategic industry as one of the main drivers of Indonesia's development. The use of metal processed products are also increasingly needed by the community, for example, mild steel products are increasingly needed by society to raw materials (framework) houses, schools, and government buildings.
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CV Anugrah Jaya is a company engaged in trading that trying to accommodate customer needs for metal materials. Such as: iron, brass, Stainless, etc. To support its marketing program, CV Anugrah Jaya trying to obtain as much as possible suppliers in an effort to get a competitive price and provide products that fit consumer needs. The product offered by CV Anugrah Jaya is building material from metal materials, such as: plate, pipe, round bar and elbow. One of the advantages of CV Anugrah Jaya is providing the round bar product in a cuts, where many similar competitors doesn’t sale these products to market, because the rest of round bar will lead to waste material which according tough competitor in selling. The industrial tren is significancy raising but the selling from CV Anugrah Jaya some how is decrasing. Some of the problems encountered in marketing employee shows that the price offered from CV Anugrah Jaya is higher than the competitor, delivery to customer some times late from the schedule,and customer is easy to move to competitor. Based on that backgroung researchers conducted reseacrh on MARKETING MIX STRATEGIES IN INFLUENCING CUTOMER SATISFACTION AND LOYALTY AT CV ANUGRAH JAYA. LITERATURE REVIEW Previous Reasearch Research Riaz and Tanveer (2012) with the title: "Marketing Mix, Not Branding", aims to further understand the basic understanding of the marketing mix on a branding perspective. The research method used in this research is qualitative research method with deductive approach. The study proposes a model that links branding and marketing mix. The theories of marketing mix and branding in the study are studied and linked to the deductive basis using logical reasons. The results of this study concluded that the marketing mix and branding formation process turned out to have interrelated relationships. The current research equation with Riaz and Tanveer (2012) research is similarly using the mixed packet variables (4P) and using the research subject of the manufacturing firm. While the difference is that the current study uses the 4P variables of the marketing mix (product, price, location and promotion) to know its role in consumer satisfaction, while Riaz and Tanveer's (2012) research uses the 4P mix marketing variables to determine their role in the branding process, Which will then produce a positive consumer response in the form of satisfaction and strong relationship between the company-consumer in a long time. Suthar et al. (2014) under the title: "Impacts of Marketing Mix and Customer Perception on Brand Loyalty", aims to examine the effect of 4P marketing mix (product, price, promotion, location) on customer loyalty. The research method used in this research is quantitative research method. The population used in the study were consumers who purchased mobile phone products in India, with a total sample of 430 people. The method of analysis used in the research is factor analysis and multiple linear regression analysis. The results of this study concluded that the product price, promotion and location have a positive and significant influence on consumer loyalty to the brand. The current research equation with Suthar et al. (2014) are both using the 4P variables of consumer packing and loyalty mix. While the difference is that current research uses qualitative descriptive analysis methods, while research Suthar et al. (2014) using quantitative analysis with factor analysis approach and multiple linear regression analysis. In addition, current research is conducted in the environment of manufacturing companies in Indonesia, while research Suthar et al. (2014) conducted within the telecommunications company's environment in India. Nuseir and Madanat Research (2015) entitled: "4Ps: A Strategy to Secure Customers' Loyalty via Customer Satisfaction", aims to determine the effect of 4P marketing mix (product, price, promotion, location) to customer loyalty via customer satisfaction. The research method used in this research is qualitative research method with inductive approach, where the data used is
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secondary data obtained from journals and books. The results conclude that the four aspects of the marketing mix are equally important and the imbalance between these four aspects can undermine overall customer satisfaction and loyalty results. Consumer purchase intentions are strongly influenced by expectations in the context of product quality, price and product accessibility. The relationship between customer satisfaction and loyalty depends on the elimination of perceptual gaps, service gaps, operational gaps and behavioral gaps that need to be managed by focusing attention on them. Therefore, the company must always be careful in using the marketing mix strategy to match the expectations of consumers, and able to eliminate the perception gap so as to expand customer loyalty. The current research equation with Nuseir and Madanat research (2015) is equally using variables of packing mix, consumer satisfaction and consumer loyalty. In addition, both studies are also equally conducted in the environment of manufacturing companies. While the difference is that the analytical method used in the current study is descriptive qualitative, while Nuseir and Madanat (2015) research uses qualitative inductive analysis method with literature study approach. REASEARCH METHODS This type of research is a descriptive study. According Sugiyono (2014; 354) that is descriptive research studies conducted to determine the value of an independent variable, either a variable or more without This is where the candidates are trained and accompanied undergraduate teaching until they become skilled to teach and educate skilled students. So that when they want to find formal employment, making a comparison or connect with other variables. In this study does not refer to the hypothesis but rather the angle of view on the phenomenon of the results of operations and data collected. This research is conducted in company environment CV Anugrah Jaya, which is a company engaged in trading for metal bermaterial products, such as iron, brass or stainless. CV Anugrah Jaya often get problems or complaints from consumers related to product, price and product distribution which is often too late. Therefore, this research is expected to provide information to the management of CV Anugrah Jaya to know things that must be improved on the marketing strategy used, so as to increase customer satisfaction and loyalty. Subjects in this study were chosen using purposive sampling technique, where informants were selected by using certain considerations and objectives according to the relevant criteria in determining informants (Sugiyono 2014: 299). Furthermore, the criteria determined to obtain informants in this study are as follows: 1. 3 person B2B Consumer CV Anugrah Jaya (Has purchased CV Anugrah Jaya product at least 3 times during the last six months. Marketing Employee CV Anugrah Jaya.
2. Expert Marketing. Data collection in this research will be done by interview method. According Bungin (2013), interview is a method to obtain information with face to face and question and answer directly between the interviewer with the speakers, using or without using interview guidelines. This study uses semi-structured interview method to enable researchers to find information more openly and profoundly (Esterberg in Sugiyono, 2014). The study also uses documentation methods that are records of a person or group of persons, events in appropriate social conditions and related to the research topic (Gunawan, 2014:175). Data validation uses source triangulation using various data sources such as documentation and interview results by interviewing more than one informant deemed to have a different point of view and meeting specified criteria.
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RESULT AND DISCUSSION Marketing Mix Strategy (4P) in Creating Customer Satisfaction CV Anugrah Jaya Consumer satisfaction is a forward-looking indicator that will show the success of the company's business, which measures how well the customer's response to the company's business future (Assauri, 2012: 11). Satisfaction is the result that consumers perceive from the performance of companies that meet their expectations. Consumers are satisfied when their expectations are met and happy when the performance of the product / service is more than what they expect (Moha and Loindong, 2016). Consumer satisfaction is the feeling of pleasure or disappointment of someone who emerged after comparing the perception / impression to the performance (or outcome) of a product and its expectations. Consumer satisfaction can be seen through several types of behavior, such as: willingness to buy back or keep using the product / service, declare the positive about the product / service, and willingness to keep using the product / service although many other products / services A kind (Karundeng, 2013). The results of this study indicate that consumers have been quite satisfied with the product offered by the company as it is also explained by marketing CV. Anugrah Jaya. B2B customer satisfaction is closely related to the form of products and services, because in addition to offering products that have a particular physical component, CV. Anugrah Jaya also provides services with certain benefits, ie cutting the round bar in accordance with the demand of B2B consumers, provided that the cutting of the round bar can be done with a minimum size of 20 cm to avoid the occurrence of slope the cutting. Tabel 1. Managerial Implications Against Marketing Mix Strategies in Creating Consumer Satisfaction CV. Anugrah Jaya Marketing Mix
Before Reseacrh
After Research
Product
B2B consumers are satisfied with the Companies need to maintain product offered by the company, a quality control system so because it has the tolerance as promised that companies do not receive complaints from consumers, especially those related to thick tolerance for pipes and plates, as they often do not match what has been promised by corporate marketing
Price
B2B consumers are not satisfied with the products offered by the company, as one of the products such as pipe is considered quite expensive, closed to within 7-10% compared with the prices offered by competitors
Companies need to give the best price to the consumers who often make product purchases, while still providing spare for B2B consumers can still negotiate price
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Place
Promotion
B2B consumers are not satisfied with the company's distribution system, because the delivery is often too late than promised.
The company needs to stock goods. The existence of stock of goods can provide benefits for the company because the company is able to suppress the price, so the CV. Anugrah Jaya can accelerate the process of distributing products to B2B consumers Consumers B2B feel less satisfied with Companies can use the promotions used by the company, brochures to further explain because the company's promotional the company's products and model is direct selling, where marketing their advantages. The companies do direct sales to consumers. presence of brochures can also enable B2B customers to resell to end-users, including making product differentiation, so that B2B consumers know the products the company offers, and focus on those products when reselling to end-users
Marketing Mix Strategy (4P) in Creating Consumer Loyalty CV Anugrah Jaya In general, customer loyalty can be categorized into three levels based on the degree of loyalty: (1) Consumers who are very loyal, who will make purchases every time; (2) Consumers who are loyal enough, where consumers loyal to two or three preferred brands of a product, although sometimes they will also replace it with other brands; And (3) unlucky customers who will buy products with different brands, because of the desire to get something different that was not obtained from the previous brand, or because the product in question is on sale (Kotler and Armstrong, 2012: 197 ). Based on the three levels of customer loyalty as described Kotler and Armstrong (2012: 197), it can be seen that overall, consumer loyalty CV. Anugrah Jaya is at a level which is quite loyal, because all consumers B2B interviewed have made a purchase on a periodic basis (repurchase), an update to the news regarding the products supplied by the company (update), and would make recommendations to others to buy a product Company (recommend).
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Tabel 2. Managerial Implications Against Marketing Mix Strategies in Creating Consumer Loyalty CV. Anugrah Jaya Marketing Mix Before Reseacrh After Research Product
Price
Place
Not updated with stock items that are The company must always often booked. Miss communication with ensure the existence of the customers about the quality of goods product, so that at any time B2B consumers need the product because of demand from end-users, the company can provide the product whenever B2B customers need it. In addition, CV. Anugrah Jaya also needs to maintain communication with B2B consumers. Basically if the product offered by the company does not have a complaint, the customers must be loyal. CV Anugrah Jaya has less attention to Marketing companies must the character of the customer so that the understand how each B2B price on offer is not in accordance with customer's characteristics. the consumer's perception. And also CV For consumers who loyalty Anugrah still not looking for price high, the price will not be a comparison from big supplier. problem, as long as CV. Anugrah Jaya is able to ensure the required product can be fulfilled by the company. In addition, companies should also be able to get a cheaper product price and get the product from a large distributor B2B consumers are not satisfied with The company must first the company's distribution system, make a list of the best-selling because the sender is often late for 3 products, so the company days from the promised schedule, thus can place orders directly to lowering the the distributor to level of consumer loyalty and forcing provide products that have B2B customers to get products from a fast turnaround. The other companies existence of a warehouse is also very important to support the stock of goods program. Companies can rent warehousing space in the Surabaya area, as most of the company's B2B
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Promotion
The company has never used any promotion except direct selling (personal selling)
consumers are located in Surabaya. The presence of stock in the warehouse, also can accelerate the time of product distribution whenever B2B consumers need it Companies must use more promotional media in addition to direct selling, such as: brochures and discount purchases.
Integration of Marketing Mix Strategies (4P) Integration of Marketing Mix Strategy is a combination of marketing mix implications on customer satisfaction and loyalty Tabel 3. Integration of Marketing Mix Strategies (4P) Marketing Mix Product
Companies need to maintain a quality control system so that companies do not receive complaints from consumers, especially those related to thick tolerance for pipes and plates, as they often do not match what has been promised by the company's marketing. The company must always ensure the existence of the product, so that at any time B2B consumers need the product because of demand from end-users, the company can provide the product whenever B2B consumers need it basically if the product offered by the company no complaints, the consumers must be loyal.
Price
Marketing companies must understand how each B2B customer's characteristics. For consumers who loyalty high, the price will not be a problem, as long as CV. Anugrah Jaya is able to ensure the required product can be fulfilled by the company. In addition, companies should be able to get a cheaper product price and get the product from a large distributor. And felt necessary to provide special marketing to large customers of the company in order to maintain a better relationship. Companies deemed necessary to consider dropshipping system to accelerate delivery. And the warehouse is also very helpful to the company. The location of the warehouse can be around Surabaya considering the biggest sales in Surabaya and surrounding areas. The presence of stock in the warehouse, also can accelerate the time of product distribution whenever B2B consumers need it Companies must use more promotional media in addition to direct selling, such as: brochures and discounts (discounts). Brochures can be divided into 2 like:
Place
Promotion
- Brochures of goods on offer by CV Anugrah Jaya - Brochure for plate finishing offered by CV Anugrah Jaya in order
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to educate the customer
REFRENCES Riaz W., & Tanveer A. (2012). Marketing Mix, Not Branding. Asian Journal of Business and Management Sciences, Vol. 1 (11): 43-52. uthar, B.K., Lathangi R., dan Pradhan S. (2014). Impacts of Marketing Mix and Customer Perception on Brand Loyalty. Global Journal of Finance and Management, Vol. 6 (7): 619-636. Nuseir M.T., dan Madanat H. (2015). 4Ps: A Strategy to Secure Customers’ Loyalty via Customer Satisfaction. International Journal of Marketing Studies, Vol. 7 (4): 78-87. Sugiyono. (2014). Metode Penelitian Manajemen. Bandung: Alfabeta. Bungin, B. (2013). Metodologi Penelitian Sosial dan Ekonomi. Jakarta: Prenamedia Group. Gunawan I. (2014). Metode Penelitian Kualitatif: Teori dan Praktik. Jakarta: Bumi Aksara. Kementrian Perindustrian Republik Indonesia. (2015). Rencana Induk Pembangunan Industri Nasional 2015-2035. Jakarta: Pusat Komunikasi Publik, Kementrian Perindustrian Republik Indonesia. Mohan, S., dan Loindong S. (2016). Analisis Kualitas Pelayanan dan Fasilitas Terhadap Kepuasan Konsumen Pada Hotel Yuta di Kota Manado. Jurnal EMBA, Vol. 4 (1): 575584. Karundeng, F.P. (2013). Kualitas Pelayanan dan Kepuasan Pengaruhnya Terhadap Loyalitas Konsumen Pada Rumah Makan Mawar Sharron Wanea Manado. Jurnal EMBA, Vol.1 (3): 639-647
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ANALYSIS OF IMPORTANCE – PERFORMANCE ATTRIBUTES ON THE HOUSING PROJECT OF PT. MITRA CIPTA PROPERTY AS INPUT FOR THE DEVELOPMENT OF CUSTOMER VALUE ORIENTATION HOUSING CONCEPT 1Miftakhul Arifin, 2Tina Melinda♠ Ciputra University Surabaya INDONESIA Email:
[email protected] ABSTRACT This research aims to do descriptive analysis on importance and performance level attributes at De’ Royal Kedanyang and Griya Taman Asri housing, analyze the gap between those two attributes, and give input for PT. Mitra Cipta Property in developing housing project with customer value orientation concept. This research uses quantitative descriptive method, and the respondents of this research are consumers who bought house(s) built by PT. Mitra Cipta Property. The number of respondents in this research is 163 respondents – 35 of them are clients of De’ Royal Kedanyang housing and 128 of them are clients of Griya Taman Asri housing. Sample size used in this research is 50% from total respondents, rounded up. Analysis technique used in this research is Importance- Performance analysis. Research shows that Importance attribute in housing which includes public facilities, social facilites, location, physical attributes, and price is scored above 4.00 and considered important by the respondents. Similar as Importance attribute, Performance attribute in housing which includes public facilities, social facilites, location, physical attributes, and price is scored above 4.00 and considered important by the respondents. Gap analysis shows that two items have fulfilled customers’ needs – location and price, while the other three items have not fulfilled customers’ needs – public facilites, social facilities, and physical attributes. Based on the analysis above, the company will make a similar concept as De’ Royal Kedanyang and Griya Taman Asri for the development of new housing with the improvement in social facilites attributes while maintaining the physical attributes. Key words: importance, performance, analysis, attribute, housing
INTRODUCTION Aside from food and clothing, shelter is one of human basic needs. With the immense growth of human population from year to year, the demand for shelter increases, thus making property industry in Indonesia flourishes. PT. Mitra Cipta Property is one of the new companies in property industry which was established in 2009. There are two housing projects that had been done in Kebomas, Gresik by this company – De’ Royal Kedanyang housing in 2010-2011 and Griya Taman Asri housing in 2012, which gave them the edge in property industry in Gresik until 2014. Unfortunately, in 2015 and 2016, a decline in profit
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happened because the company did not build any new projects. They were focused on selling all of the houses built in those two previous projects. Partly, the decline in profit was caused by the stagnant state of housing industry. For this reason, the company decided to do a new housing project in order to increase profit and turnover of the company. Therefore, this research aims to analyze various housing attributes which made De’ Royal Kedanyang and Griya Taman Asri popular choices among customers of PT. Mitra Cipta Property. LITERATURE REVIEW Previous Research There are several researches that are relevant with this study. First is study done by Oloke, Simon, dan Adesulu (2013) titled “An Examination of the Factors Affecting Residential Property Values in Magodo Neighbourhood, Lagos State”. With purpose of finding the accessibility of influence measured from distance, cost environment, property structure and location characteristic to property value in Magodo, Lagos State.232 questionnaires were spread to several groups of respondents who are surveyors, real estate evaluator and residents of Magodo. The result shows that distance and cost did not affect the housing property value, however, factors such as number and size of bedroom size, comfort, surrounding infrastructure are considered significant. Another research called “Analisis Importance Performance Atribut Lingkungan Hunian Terhadap Persepsi Pembeli Pada Perumahan Riverside Malang” done by Irianto (2013).With 30 respondents, 18 respondents from Low Class (Sederhana) Housing customers and 12 respondents from middle class house customers, this research uses both cross tabulation analysis and Importance Performance Analysis (IPA) to view which attributes is of importance to the consumers and consequently which attributes needs to be improved to further increase customer’s satisfaction. The research shows that transportation infrastructure as well as cleanliness in the neighborhood holds the highest priority for Low Class Housing customers, while the middle class housing prioritize in installation of independent energy installation and the use of recycled material for structural building. Another research that uses IPA and Cross-tabs analytics is “Analisis Kepuasan Pelanggan Dengan Importance Performance Analysis Di SBU Laboratory Cibitung PT Sucofindo (Persero)”, done by Ong and Pambudi (2014). The research compares actual performance and customer expectation towards the customer satisfaction through the lenses of marketing elements such as Reliability, Responsiveness, Assurance, Empathy, Tangible, Product Quality, and Price specifically in SBU Laboratory Cibitung PT. Sucofindo. Using 98 consumers as samples for this research, this study uses Importance Performance Analysis as analytical method that includes 35 attributes inside 7 variables. The research concluded that there are three indicators that are considered to be the most important which are: external appearance of PT. Sucofindo employees, Cleanliness of PT. Sucofindo facilities and good service by Sucofindo employees. The last research was titled “Quality in Construction: Identifying the Gaps” by Fischgrund and Omachonu (2014). The purpose is to know the quality gap in construction project which is an improvement from analysis gap declared by Parasuraman in 1985. This is a qualitative research using unstructured interview to 11 users of construction services and 4 construction companies. The result of this research shows that some clients believe that their expectations on construction works will be better if they have some knowledge of the industry. Construction companies also agree that they will improve their works if their clients are more knowledgeable. The gap between what the companies and the clients perceive as important and their perceptions on satisfaction create quality gap. This gap should be treated so that the quality given to the clients will be able to fulfill their expectations and therefore, customer satisfaction will arise.
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LITERATURE REVIEW Consumer Behavior Consumer behavior can be defined as mental, emotional, and physical activities of a person in choosing, buying, using, and throwing away products and services to satisfy needs and wants (Durmaz, 2014:194). Sangadji and Sopiah (2013:181) stated that many companies are successful nowadays because they are successful in fulfilling their customers’ hopes. Furthermore, Sangadji and Sopiah (2013:190) explained that buyers’ decision making process does not stop in the buying stage. They will do evaluation based on the consumption. This is the so-called post-buying alternative process, where the result is only satisfaction of dissatisfaction. Satisfied customers will repeat the consumption, while dissatisfied customers will not buy again. Kotler and Keller (2012:153) stated that the quality of products and services, as well as satisfaction of customers and the profitability of the company are closely related. Higher quality will result in higher satisfaction, and in many occurrences, it will support higher price and lower costs. In a business world, there is the well-known jargon: Customer Value Orientation. It is a business entity trying to create values that can satisfy customers’ needs and wants through adjustment in the development of its products and services, and so the creation of customers’ values (Jeong, Min, and Yoon, 2014:37). Housing Attributes Positive investment trends as well as the housing need for every person create huge opportunity for developers. Anastasia (2013:144-145) stated that there are several factors need to be taken care of by the developers, such as: 1. Environment Environment is everything around us, be it animate or inanimate objects as well as the atmosphere created by the interaction of those objects. Those living in housing area do not only expect for a good house, but also a safe and comfortable living area, complete with many facilities that can give off exclusive aura. Based on 1992 Government Regulation No. 4 Chapter 1 Verse 6, environment is a complete supporting facility consists of public and social facilities functioned as development for economic, social and cultural life. Facility is functioned to fulfill buyers’ needs. Public facilities include street, water, electricity, waste management, sport field, green open space; while social facilities include school, prayer site or building, market, graveyard, medical center, and government office. 2. Location Location is the whereabouts of the house. Some factors considered in choosing location are: Accessibility and closeness: distance to work place (-) and public transportation (+)
• Social factor: social economic status (+), external factor caused by social disturbance (-)
• Infrastructure: availability of public and private services (+) • Physical environment, which is the high (-) or low (+) density level of high rise buildings; or non-physical environment, which is the positive imaging (+), noise and pollution level (-) • City space: the image of city and government regulation 3. Physical Attribute Product attribute is defined as the representative of specific features or physical characteristics that are designed into goods or services. Physical attribute includes:
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• Physical Quality Generally, it is the quality of materials used in building, such as bricks, ceramic tiles, meranti wood windowsills and doors. Special physical quality needs relatively expensive price such as furniture from jati wood.
• Physical Design Composition and exterior shapes will contribute on the overall feel of the environment, since conformity in sizes, proportions, and physical design of the surrounding buildings will create good atmosphere. Three important things to fulfill in creating a building are strength, usefulness, and elegance. There are four factors to fulfill in making good building model which are aesthethics, structure, outer layer, and the building’s necessities.
4. Price Price is the money spent to get a product. Each consumer has different price sensitivity. In marketing, price is set based on the position the company wants in market, representative of its image and value given to customers, volume of sales and profit projected as well as the competitors in that business. Consumers can choose payment method as such:
• Cash, where consumers pay the price of the house exactly as the total price, so that in the future the customers do not have any liabilities to the developer • Housing loan (i.e. KPR – Kredit Pemilikan Rumah). Every developer offer different housing loan such as loan from public banks, loan from private banks, and loan from the developer (i.e. in-house loan) Analysis on Importance – Performance This technique was first established by Martilla and James in 1977 in an article titled “Importance-Performance Analysis” published in Journal of Marketing. In this technique, respondents are asked to score the importance and performance levels of a company. The mean values of importance and performance levels are analyzed and mapped in ImportancePerformance Matrix where x-axis shows perception and y-axis symbolizes expectation. The result can be in one of these four quadrants:
A. Concentrate Here There are factors perceived as important to customers but the company’s performance is not satisfying, thus the company needs to concentrate to allocate resources in increasing their performance.
B. Keep Up the Good Work There are factors perceived as important and company’s performance is sufficient to support them, thus the company need to keep up the good work.
C. Low Priority There are factors perceived as not too important and the company’s actual performance is low, thus the company does not need to prioritize or be concerned of these factors.
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D. Possibly Overkill There are factors perceived as not too important and the customers’ do not expect much on those. Thus, the company is better to allocate their resources spent for these factors for other high priority factors. RESEARCH METHODS This research is a descriptive research done using quantitative descriptive approach. Respondents used in this research project are the buyers of properties built by PT. Mitra Cipta Property. The number of respondents is 163 people in which 35 of them are buyers of De’ Royal Kedanyang properties and 128 of them are buyers of Griya Taman Asri properties. Number of samples taken from this research is 50% from the total number of respondents, which in this case is rounded up to 82 respondents. This research uses purposive sampling technique with only one criterion, which is the respondent chosen must have owned and settled in the property bought for at least 1 year. This research was done at De’ Royal Kedanyang and Griya Taman Asri housing, Gresik, within September 2016 to December 2016. The type of data used for this research is quantitative. Data collection was done using questionnaire to the buyers as well as library study for literature knowledge. This research uses several independent variables where each variable is independent of influence from other variables. The definition of operational variables in this research is shown below:
1. Environment (X1) Environment is measured from the availability of public and social facilities. The availability of public facilities includes water, electricity, telephone, waste management, sport field, and green open space. The availability of social facilities includes market, transportation modes, prayer site or building, office, school, recreational facility, hospital, and graveyard.
2. Location (X2) Location is measured with the time spent to go to various locations, such as office, mall or shopping center, transportation mode, police office, medical center, traditional market, school.
3. Physical attribute (X3) Physical attribute of housing consists of the housing model or type, area width, building size, exterior and interior facilities.
4. Price (X4) Price consists of payment system, down payment needed, and whether the property is directly livable after payment is done. This research uses Likert scale with the detail of the scale below: Importance level: -
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Very important (SS) with score 5 Important (S) with score 4 Neutral (N) with score 3 Not important (TS) with score 2
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- Very not important (STS) with score 1 Performance level – perception (realization): - Strongly agree (SS) with score 5 - Agree (S) with score 4 - Neutral (N) with score 3 - Disagree (TS) with score 2 - Strongly disagree (STS) with score 1 The data collected will be processed using validity test (i.e. valid when sig. value is less than 5%), reliability test (i.e. reliable when coefficient is greater than 6), and calculation of mean. RESULT AND DISCUSSION All the data gathered must first undergo the validity and reliability tests, ensuring that the data processed are solid thus, the results are reliable and applicable as well. For validity test, all items under Environment (X1 – public and social facilities), Location (X2), Physical Attribute (X3), and Price (X4) are all valid with sig. value < 0.05. Moreover, all variables’Cronbach Alpha are greater than 0.6. Therefore, all independent variables are valid and reliable to be processed further. Calculating the mean of each variable, it is known that public facilities scored 4.063 on importance and 4.030 on perception of performance. Social facilities is scored 4.130 on importance and 4.031 on perception of performance. Location is scored 4.078 on importance and 4.160 on perception of performance. Physical attribute is scored 4.159 on importance and 4.105 on perception of performance. Price is scored 4.073 on importance and 4.119 on perception of performance. Looking at those mean values, it can be said that all variables are scored high both on importance and perception. Data analysis of this research is through gap analysis to know the gap between the current condition and customers’ expectation on housing attributes. The result of gap calculation is presented at Table.1. Table.1 Gap Analysis Variables Expectation (Y) Perception (X) Gap (Perception – Expectation) Public facilities 4.063 4.030 - 0.033 Social facilities 4.130 4.030 - 0.100 0.082 Location 4.078 4.160 Physical Attribute 4.159 4.105 - 0.054 Price 4.073 4.119 0.046 Average 4.101 4.089 - 0.012 Looking closer on Table.1, public facilities, social facilities, and physical attribute are three variables where the customers rated importance higher than their perception on the company’s performance. It means the company needs to give more effort to satisfy the customers. Meanwhile, for location and price, the company’s performance is more than what the customers’ perceive on the importance of these variables. On average, the gap of [0.012] shows that the company’s performance is still below the expectation of customers. Next, a Cartesian diagram about housing attributes were created as shown in Figure.1 below.
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Figure.1 Cartesian Diagram Social facilities is at Quadrant A, where it is perceived as important yet company’s performance is still not up to par. Thus, social facilities need to be prioritized to be improved by the company. Physical attribute is at Quadrant B. It can be said that the existence of physical attribute is of concern to be maintained since it is perceived as important and the company’s performance can already fulfill the expectation. Price and Location is at Quadrant D. This condition shows that both variables can meet or even above customers’ expectation. Public facility is at Quadrant C which means that this variable is perceived as not too important and the company’s current performance cannot fulfill customers’ expectation yet. Since it is low both on expectation and performance, no improvement is urgently needed for this variable. For more detailed analysis on each variable, a Cartesian diagram is made for each so that it can be known which item falls into which quadrant as shown in Table.2 and Table.3. Table 2. Cartesian Diagram Result for Location and Price Quadrant A Quadrant B Quadrant C Location • Distance • Distance to • Distance to to office shopping center transportation modes • Distance to police office • Distance to medical • Distance to center traditional market Price • Down payment max. • Down • Housing loan for > 15% payment 10 years • House in livable within in 3 months of finishing installme down nt payment
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Quadrant D • Distance to school
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Table 3. Cartesian Diagram Result for Public Facility, Social Facility, and Physical Attribute Quadrant A Quadrant B Quadrant C Quadrant D Public • Electricity min. • PDAM Facilities 1300 KWh water source • PT.Telkom for landline • Sport field • Waste management • Green open space • School • Office • Market place Social • Public building • Prayer sites Facilities transportation • Recreationa modes l facilities • Public graveyard • Hospital • Area width min. 60 m2 • Up-to-date Physical • Building size min. 36 Attribute house model m2 • Interior facility • Exterior facility e.g.: e.g. kitchen gate Based on the Cartesian diagrams, some managerial changes are due to take place, expecially for the three variables where the company’s performance has not met customers’ expectation. Some of the applicable managerial changes are: • Social Facilities For housing development with many units (i.e. more than 250 units), the company needs to consider building schools (i.e. PAUD for babies and kindergartens) especially if the majority of clients are newlywed couples. For schools above those two levels, the clients are advised to find schools outside of the housing complex. For housing with less units, a survey is needed to make sure whether there are schools – PAUD, kindergarten, elementary schools, in vicinity. In building housing complex, the company should make access way easily accessible by public transportation modes. Moreover, the company can spare sufficient area in front of the complex so that public transportation can stop and take passengers there. In big-scale housing complex (i.e. over 500 units), the company can allocate sufficient area for graveyard. However, if the units are relatively not many, then the company should forge good relationship with graveyard people near the complex so that it is possible to use that graveyard for people living in the housing complex. • Physical Attribute When the company is ready to develop new housing project, it is of importance to note that the minimum area width is 60 square meters with the minimum building size of 36 square meters. Furthermore, it is important to take note of the exterior facility such as building a gate. CONCLUSION Based on the above result and discussion, there are some conclusions that can be taken as listed below: Importance attribute of housing used in this research includes public facilities, social facilities, location, physical attribute, and price. The score given is above
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4.00 and thus, it can be said that those items are considered important by the respondents 2. Performance attribute of housing used in this research includes public facilities, social facilities, location, physical attribute, and price. The score given is above 4.00 and thus, it can be said that the performance of those items are greater than the consumers’ perceptions. 3. Gap analysis result shows that two variables from housing attributes which are location and price have met consumers’ standard, while the other three attributes which are public facilities, social facilities, and physical attribute have not met consumers’ standard. 4. The company must consider to develop a new housing project similar to the existing one such as De’ Royal Kedanyang and Griya Taman Asri housing. Yet, it is better if there are enhancements in social facilities attribute while maintaining the physical facilities attribute. RECOMMENDATION Based on the above conclusion, there are some suggestions that can be given: 1. The company can utilize this research result as reference in decision – making in developing new housing project. Social facilities and physical attributes need more attention than the other three attributes. 2. Other researchers can do a wider research with various property companies’ consumers as respondents so that the result can represent wider range of consumers in property industry. REFERENCES Anastasia, N. (2014). Peta Persepsi Konsumen Terhadap Atribut Rumah Tinggal Di Surabaya. JMK, VOL. 15, NO. 2, SEPTEMBER 2013, 141-152 Durmaz, Y. (2014). The Impact of Psychological Factors on Consumer Buying Behavior and an Empirical Application in Turkey. Asian Social Science; Vol. 10, No. 6; 2014, 99.194-204 Fischgrund and Omachonu (2014). Quality in Construction: Identifying the Gaps. Irianto (2013). Penelitian Atribut Perumahan dengan menggunakan Analisis Importance-Performance Jeong, D.Y., Min, S.M., Yoon, D.J. (2014). Customer Orientation and Organizational Performance: Mediating Role of CRM. Advanced Science and Technology Letters Vol.57 (Business 2014), pp.35-39 Kotler, P., & Keller, K. (2012). Marketing Management. New Jersey: Prentice Hall. Oloke, Simon, dan Adesulu (2013). An Examination of The Factors Affecting Residential Property Values in Magodo. Ong, J.O., Pambudi, J. (2014). Analisis Kepuasan Pelanggan Dengan Importance Performance Analysis DI SBU Laboratory Cibitung PT Sucofindo (Persero). J@TI Undip, Vol IX, No 1, Januari 2014 Sangadji, E. M., & Sopiah. (2013). Perilaku Konsumen - Pendekatan Praktis Disertai Himpunan Jurnal Penelitian. Yogyakarta: CV ANDI OFFSET
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ANALYSIS THE EFFECT OF COMPENSATION AND MOTIVATION ON EMPLOYEE PERFORMANCE THROUGH JOB SATISFACTION IN PT. BERSIH BIJAK SEJAHTERA Hermand Michael Tulung, 2Denny Bernardus♠
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Ciputra University Surabaya INDONESIA Email:
[email protected]
ABSTRACT Basically an employee in implementing obligations is charged with expected to show a performance the best that could shown by the employee. Performance should be measured by the that it can be seen the extent to which the development of the performance of a clerk in particular and organization in general. The purpose of this research that is as follows: 1) To test the influence of compensation on job satisfaction in PT. BBS. 2) To test the influence of motivation on job satisfaction in PT. BBS. 3) To test the influence of job satisfaction on performance in PT. BBS. 4) To test the influence of compensation on performance in PT. BBS. 5) To test the influence of motivation on performance in PT. BBS and 6) To test the influence of compensation and motivation for the employee performance with satisfaction work as variable intervening in PT.BBS Approach research used in this research was quantitative. A population in this research were 105 people, who is an employee production line on PT. BBS are having tenure on the 1 year with total sample are 52 samples. Analysis techniques using path analysis. Based on the research done and discussion has been done so conclusions research results degradable as follows: 1) Compensation influences work satisfaction employees means that a compensation obviously may increase or decrease work performance, job satisfaction 2) Motivation influences an employee job satisfaction in PT. BBS. 3) Job satisfaction influences employee performance in PT. BBS, that means that higher satisfaction work in those things hit conformity of work, wages, promotion, colleagues and that supervision by company hence employee performance to increase. 4) Compensation influences employee performance in PT. BBS, that means that the more improved material compensation, social compensation and activity compensation, so the employee performance increased. 5) Motivation influences employee performance in PT. BBS are means that higher thrust in meeting the needs of physiological, a security needs, impulse social needs, encouragement of the needs of self esteem and encouragement soul actualitation and employee performance to increase. 6) Compensation and motivation impact on the employee performance with job satisfaction as variable intervening in PT. BBS. Keywords: Compensation, Motivation, Employee Performance and Job Satisfaction
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INTRODUCTION A good performance will encourage moral a clerk to do better that he had high achievement (Robbins, 2014:78). Performance is benchmark for its success employees in working company, in which the performance and improved they by itself the good company short term as well as the long term for maximum. The often done in an effort to the measurement of the employee performance by indicators both in quality, the quantity and period of completion work done employees. The performance of the employees can be achieved through a planning precisely in accordance with the provisions and hope employees in working company. This condition is making a reciprocal relation between employees and companies are important in the process of increasing employee performance. Research results Wahyono (2009) shows that simultaneously there are significant impact, variable extrinsic motivation for employee performance. A partial variable free of the external motivation and corporate culture significant on performance employee with variable dominant variable motivation external dominant influence on the performance of sugar factory workers Kebonagung, Malang. Research results Abdulloh (2006) shows that work satisfaction employees be important to increase employee performance and its effect in research is directly, but the work satisfaction, namely work itself has influence the most powerful compared with other indicators, namely the opportunity promotion, colleagues, and supervision. Performance achievement in an employee is not only a coincidence but a lot of factors affect, any one of them that give compensation. Company policy relating to compensation is part of a reciprocal relation between organization or company with human resources. The employees would be motivated to do the responsibility for their work if it understand and seen right will the needs of employees that fundamentally they work for get the money. For when compensation is provided precisely and right, so the employees will have performance and motivated to toward the goals company. But if compensation is provided inadequate or inaccurate, so employee performance will decline. Compensation be rights of the employees about what for workers as exchange over contribution to organization. In compensation there are system connecting it with performance. By compensating to workers awarded based on performance and not based on seniority or the number of working hours (Wibowo, 2007:134). The importance of compensation as one of indicators satisfaction in working hard estimated, because employees views about money or recompense directly seems very subjective and maybe is something that is distinctive in a job. Compensation important for employees as individuals because the size of the compensation reflect size value their work of employees itself, the family and social. Then compensation program also companies is important, with it reflects efforts organization to maintain human resources. Besides satisfaction work and compensation is one factor again that influence the performance that is motivation. In terms of occupation , motivation is one important factor in encouraging an employee to work. Motivation reflect thrust for someone to contribute by might by the organization to achieve its objectives. Motivation is also the driverwho created the excitement work for them to cooperate, perform effectively, and is integrating in all of an effort to reach satisfaction. The performance employees did not regardless of the company to create satisfaction work. Satisfaction own work can be defined as an emotional fun and loved her other good deeds with the discipline benchmarks, moral work and turnover employees. Satisfaction is basically general attitude towards their job someone, showing a difference between the amount of appreciation for workers and the amount they believed they were due to receive. Satisfaction employment was driving key moral work, discipline and work performance employees in
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support of the realization of the company. A clerk who work well and produce a good performance would be satisfied, for he has been able to provide hasi the best. Job satisfaction employees are the targets important in human resources management, because directly or indirectly will affect work productivity. A phenomenon can make damage to the companies condition is the low satisfaction work employees where arising such symptoms of them are lazy, many complaints, low work performance, training employees and other symptoms negative. But high satisfaction sought by companies from can be linked to a positive outcome for them. Job satisfaction high indicates a company has managed well and management effective Job satisfaction also reflects the emotional state employees where occurred and does not happen the common ground or between the gained employment services an employee of the company or organization by degree of value for services is desirable by employees concerned. Job satisfaction employees to reflect on the emotional state employees can be shown of the company in support of satisfaction at work, for example by giving appropriate salary for them, on the promotion clearly and variously shaped facilities support efforts to create satisfaction at work. PT. BBS for have employees performing good, motivated and compensation good, so that the employees would be satisfied in working and will give the best in the process of work. To get satisfaction work from the staff of this then the PT. BBS must be able to provide compensation according to work, in addition the performance of work also must be created to give flavor satisfied for employees that would give the results of the process work good. LITERATURE REVIEW According Simamora (2011:540) compensation is “What accepted by the employees instead of their contribution to the organization”. According Mangkunegara (2011:83) “Compensation too be defined as a process administration wage or salary involving consideration or balance calculation”. So it can be concluded that compensation is considered as something similar. In human resources management, a reward that money is in the form of compensation given to employees as the award of their services. Besides the prize wage or salary also classified as a form of compensation is provided for employees. Motivation deriving from latin movere, word is basically a motive which means encouragement, cause or reason someone do something. Thus motivation mean a condition that push or being because someone do a deed or activities (Nawawi, 2009). According Mangkunegara, (2012:61) defines that motivation is a condition or energy that drives self employees who directed or were loyal to achieve the purpose of the organization. While motive itself is an encouragement in self needs employees who need to be fulfilled so the employee can conform to its environment. So we can conclude that motivation is things that encourage somebody to perform a certain action in achieving the purpose. According Luthans (2011:243), job satisfaction is the result of perception employees about how well their work gives thing that is considered important. Locke in Luthans (2011:243 ), give a definition of satisfaction comprehensive work which includes a reaction or cognitive attitude, affective, and evaluative and states that employment is satisfaction. “The state of emotion which is excited or positive emotion derived from the assessment of work or work experience someone.” According Handoko (2011:193) job satisfaction is the emotional state of pleasant or unpleasant with which employees looked at their work. According Robbins (2014:101) stated that satisfaction of work as a general attitude of an individual against his job. Someone with the level of satisfaction that high employment has a positive attitude towards his job, someone who is not satisfied with his work has a negative attitude towards the job. Waldman in Koesmono (2005:170); performance was a combination behavior to the
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accomplishment of what is expected and his choice or part the terms of an existing task in each individual in the organizations. According Mangkunegara (2012:67); performance can defined as a result of a work as the quality and quantity of that can be attained by someone an employee in work in accordance with the responsibility of who is given. Cascio in Koesmono (2005:170) claim that performance is achievement employee of its duties that has been set. Soeprihantono (Koesmono, 2005:170) claim that performance is the result of the work of a employees over pereode certain compared to various the possibility, for example standard, target as specified first and had been mutually agreed upon. Another argument said performance be a function of motivation and the ability. To complete duty or work someone duly having degrees willingness and the level the ability certain (Rivai, 2013:309). RESEARCH METHODS Approach research used in this research was quantitative, to express influence two variables or more, where the value of masing-masing variable held by an individual. The application of the research is seeking variable influence the Job Satisfaction (Y), Compensation (X1), Motivation (X2), with variable bound the Performance (Z), and to examine and analyze some hypotheses which was formulated. All the data will be processed and uncultivated with a quantitative analysis. Focus on this research is to influence analysis was conducted either directly or indirectly between variables satisfaction, compensation, motivation and employee performance. Data analysis techniques used in research is path analysis. The analysis is a form of the application of multiple regression using the chart a guide to the testing of hypotheses complex. The path analysis used to test causation based on knowledge, the formulation theory and assumptions, can also be used to test hypotheses the study and menafsir the relationship. RESULTS AND DISCUSSION The analysis shows that the is the satisfaction of compensation to work employees in an employee of PT. BBS. Compensation is the whole of revenge services for employers and employees both pecuniary direct of money (financial) and indirect (non financial). By that definition, the more aware that something compensation obviously may increase or decrease work performance, job satisfaction, and motivation employees. “Therefore important that attention to the organization is right and fair, be further improved.” (Martoyo, 2007:116). Each company of the opinion that the company had satisfaction high so the company can be achieved well. But that raises the high job satisfactio is when the hope of employees as it is that employees natural whether material and non material. In order to promote job satisfaction, companies can choose some way appropriate for the situation and the company, of is doing promotional programs office and compensation. This is because each employee have hope to have a better life appropriate places and the responsibility employees in do their job. Compensation in recognition the success of some one which showed work performance high in pay the obligations in employment and post now, as well as recognition of the potential concerned in occupied a higher position in organization . The influence of compensation satisfaction to work with increased compensation is provided by the company, it will increase employment satisfaction employees. The compensation reflect status, recognition, and the meeting the needs of enjoyed by employees with his family. If it is accepted service employees bigger means more his the higher, status the better, and working needs will be enjoyed the more also . Thus satisfaction that is good. The significant influence and positive between compensation to work satisfaction employees in an employee of PT. Bersih Bijak Sejahtera show that under an increase of compensation and satisfaction verb be increased. Reality shows that amendments to compensation policy in this case of compensation material
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in salaries, bonus, incentive and comfortable office, and various forms of pension benefits for example, health insurance and support for enhancing job satisfaction of employees. Besides social compensation in this status, recognition as an expert in the field, recognition achievement, promotion, certainty tenure, recreation support to create satisfaction in working company. As for the last is about compensation activity, where compensation can give support for aspects a job that is not out with provide the opportunity to do a certain activity so as to give support efforts to company created satisfaction work to an employee. The results of the study Yusron Rozzaid (2014) obtained the result that compensation have leverage a significant impact on satisfaction work employees. The analysis shows that the is the satisfaction of the incentives to work employees in an employee of pt .Sage prosperous clean .The analysis showed that with the creation motivation demonstrated by the connection employee in regard confidence , trust and openness is fundamental consideration .Climate such organization considered in line with the productivity high and implementation of the effective strategy .One of these targets important to human resource management in an organization that the work satisfaction employees an organization concerned , more advanced would increase work performance. With satisfaction work is expected to reaching its objectives organization will better and accurate.For it is very important to the organization to give the propelling or motivation to karyawan-karyawannya work, so what will be achieved. Often the terms of satisfaction and motivation used in turn. Satisfaction or dissatisfaction individually employees in subjective derived from conclusion based on the contrast between what passes employees of the employees compared to what to expect, desired or expected someone. Job satisfaction seem to be affecting the presence of someone in the workplace, and wanted to make changes work, and also influences willingness to work. The clerk to work usually shows its support activity leading on the objective. Thus what is called with the motivation employees is his behavior directed at organization puspose and having activities which easily can be interrupted . The significant influence and positive shows that the work and motivation employees gratifications work employees in an employee of pt.Clean sage peace will increase.This shows that with an increase in on an impulse not need food, clothing, and housing, conducive to working, health insurance and benefits old age, relations with superior employees, cooperation with my work and a sense of responsibility, the potency advancement themselves, the ability to reach target and to complete the objectives and encouragement aktualisasikan themselves to support to create satisfaction work employees. Mangkunegara (2001:117) there are two factors affect satisfaction work, the factors that is myself employees and the job, which is complete degradable as follows: 1) Employees Factor, the intelligence (IQ), special skills, age, sex, the physical condition, education, work experiences, working time, personality, emotions, ways of thinking, the perceptions and attitudes of work. 2) Job factors, is a work, the structure of the organization, rank (group), position, quality supervision, financial security and ensure the labor, promotion of opportunity, social interactions, and working relationship. The analysis shows that the is the of the incentives to performance employees in an employee of pt .Sage prosperous clean .These results suggest with an increase in motivation employees in working which includes a physiological need of encouragement , the safety , kebutuhankebutuhan social , the need for of self respect and aktualisasikan soul and employee performance to increase .The employee performance has shown with an increase in quantity work in this ability plan , ability to carry out the orders or instruction. The presence of in things hit activity the employee in of the routine activities company and cooperation that is the ability employees in doing cooperation .Motivation formed from the attitude of a an employee in have a situation work
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.Motivation are the condition of the that drives self employee who directed to reach organizational goals .Mental attitude are the condition of the mental pushing themselves employees to try to achieve work performance in full .( mangkunegara , 2000: 68 ) .A leaders should in motivate appropriate must be able to see behavior shown by employees and chosen the way of what can used that they motivated to work. The motivation appropriate and precise with employees needs to be preserved that employees mengasilkan achievement can work in the interests company.In implementing management a manager must be able to motivate orang-orang working in order to reach the work performance high.Orang-orang was its important in any organization ( moekijat, 2005: 109).nMotivation have an important role in increase work performance employees.This is due to work performance employees directly a role in determining a desired goal by the company. The motivation must be able to move employees will work to work labih good and right to reach work performance high.With the performance of high and the results obtained in accordance with desirable company will cause the employees .Will be used by workers needs fisiologisnya , then lead to the needs of higher. The analysis shows that the is the work of satisfaction with the performance an employee at PT. Bersih Bijak Sejahtera. Thus it can be said that by changes worker satisfaction goes by it self have a positive impact on the performance. In other words more satisfied employees work in agency for this to maximize the capability of potential can be achieved in full. Satisfaction is basically condition of being felt employees in working in agency. Job satisfaction felt by employees to support in an effort to guarantee continuing to work company. Job satisfaction to support the company to maximize potentials so determine the performance employees. Job Satisfaction was one of the elements important role in organization, this is because satisfaction work can be influence behavior of individuals in implementing a job. According Robbins (2003:30) define satisfaction experience the difference between many for received in an attitude to a behavior so that in this case was believed that employees with more productive of on employees are not satisfied. According Luthans (2006) job satisfaction is the result of perception employees about how good job they give it was important. Memburga and Larsena (2007), that pleasure work referring to individual satisfaction – individual overall or less satisfaction with the work they do now certain company. The analysis shows that the is the compensation of the performance of employees in an employee of PT. Bersih Bijak Sejahtera. According to the analysis shows that the compensation in a company gonna be good if adjusted to the needs of employees. Having of different capabilities between one with another. To improve the ability of the employees, necessary role of a leader who have skills to coach, directing, and understand the desire – wishes and aspirations of its members. For work in an earnest manner, the orientation of a leader to influence and move its members deals very closely with style compensation is applied, as well as capable of propelling working spirit their employees to work in an earnest manner. Compensation based on their work is a program that is based on achievement in accordance with the responsibility of conducted by employees. The company would provide compensation either directly or indirectly to employees who can work with kind. To give a compensation given the company is a strategy company to motivate our employees to work better, and in addition, as an instrument for needs fulfillment. The greater the compensation
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good salary, allowance, incentives and insurance accepted, able to meet the needs of employees are satisfied with the results obtained and work performance will increase. The influence the also provides an overview of compensation material, compensation social and compensation the activity of giving support in an effort to create or increase of employee performance. Employees maybe the jobs work charged with good. And maybe not. That will happen if employees was not have the urge to work well for handle it, required leadership who able to move employee to excited in working. For that orientation a leader in influence and move inferiors are related to the compensation applied as said by Gibson, Ivancevich and Donnely (2009:5), that “How leader tend to meet a task theysubordinate, it most depends on compensation is provided in in order to improve performance the employees in the company.” CONCLUSION Based on the research done and discussion has been done so conclusions research results degradable as follows: 1) Compensation influences satisfaction an employee at PT. Bersih Bijak Sejahtera which means that the better compensation policy which includes compensation material, compensation social and compensation activity given company hence satisfaction verb be increased. 2) Motivation influences satisfaction an employee at PT. Bersih Bijak Sejahtera which means that higher thrust in meeting the needs of physiological, a security needs, impulse social needs, encouragement of the needs of self esteem and encouragement soul actualitation and employee performance to increase. 3) Satisfaction work influences employee performance in PT. Bersih Bijak Sejahtera, that means that sekmakin tinggnya satisfaction work in those things hit conformity of work , wages , promotion , colleagues and that supervision by company hence kinerkja employees alan increased. 4) Compensation influences employee performance in PT. Bersih Bijak Sejahtera, that means that the more improved material compensation , compensation social and compensation activity and the employee performance increased 5) Motivation influences employee performance in PT. Bersih Bijak Sejahtera means that higher thrust in meeting the needs of physiological, a security needs, impulse social needs, encouragement of the needs of self esteem and encouragement soul actualitation and employee performance to increase. 6) The compensation and motivation for the employee performance work through satisfaction in PT. Bersih Bijak Sejahtera.
REFERENCES Abdullah, Z. (2006). Pengaruh Stres Kerja Terhadap Kinerja Auditor Melalui Motivasi Kerja Sebagai Variabel Intervening (Studi Pada Auditor Intern di Pemerintah Provinsi Aceh). Jurnal Akuntansi ISSN 2302-0164. Vol. 2 No. 1. Adeoti, J.A and Isiaka, S.B. (2006). Non financial compensation and it’s impact on employee performance in selected nigeria firm. Nordic Journal of African Studies 12(2): 164–179 Aji, Hahal Syah, R. dan Kurniasih. (2012). The Intellectual Capital Effect on Financial Performance At Islamic Insurance, Jurnal Al-Isthihad Vol.VII Juli 2012. Anuar Bin Hussin. (2011). The Relationship Between Job Satisfaction And Job Performance Among Employees In Tradewinds Group Of Companies. Research Journal of Applied Sciences, Engineering and Technology 8(17): 1875-1883, 2014
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Dessler, G. (2011). Sumber Daya Manusia, Edisi Bahasa Indonesia, Jilid 2, Penerbit PT. Prenhallindo: Jakarta. Hamidi. (2014). Metode penelitian kualitatif: pendekatan praktis penulisan proposal dan laporan penelitian, Malang: UMM Press Handoko, T. (2011). Manajemen Personalia dan Sumberdaya Manusia. Edisi kedua, BPFE-Yogyakarta. Hasibuan. (2011). Manajemen Sumber Daya Manusia. Cetakan Kelima. Edisi Revisi. Bumi Aksara. Jakarta. Luthans. (2011). Manajemen Personalia Dan Sumber Daya Manusia, Edisi 2, Cetakan Ketujuh, BPFE, Yogyakarta. Mangkunegara. (2011). Manajemen Sumber Daya Manusia Perusahaan, Cetakan Kedua, PT. Remaja Rosdakarya Offset, Bandung. Mathis, R. (2013). Manajemen Sumber Daya Manusia, Edisi Pertama, Salemba Empat, Jakarta. Pantjadjati, S. (2003). Kajian Terhadap Kepuasan Kompensasi, Komitmen Organisasi, Dan Prestasi Kerja Rivai. (2005). Manajemen Sumber Daya Manusia dalam Bisnis Modern. Edisi keempat, Yogyakarta : Gajah Mada University Press. Robbins, S. (2014). Teori Organisasi. Edisi Ketiga, Cetakan Ketiga, Penerbit: Prentice Hall Inc. Santoso, S. (2012). Analisis SPSS pada Statistik Parametrik. Jakarta: PT. Elex Media Komputindo Simamora, H. (2011). Manajemen Sumber Daya Manusia. STIE YKPN; Yogyakarta. Solimun. (2013). Multivariate Analysis Structural Equation Modelling (SEM) Lisrel dan Amos. Fakultas MIPA, Universitas Brawijaya Swasto, B. (2011). Pengembangan Sumber Daya Manusia Pengaruhnya terhadap Kinerja dan Imbalan.FIA Unibraw Malang. Widjaja, T. (2010). Pengukuran Kinerja Dengan Balanced Scorecard, Harvarindo, Jakarta Yaseen, A. (2013). Effect of Compensation Factors on Employee Satisfaction- A Study of Doctor‟s Dissatisfaction in Punjab
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CREATE WEALTH LIKE A MARKETER AND MAINTAIN IT LIKE A MANAGER: INTRAPRENEURIAL SPIRIT IN PRACTICE 1
Evi Thelia Sari
STIE Mahardhika Surabaya INDONESIA Emails:
[email protected] ABSTRACT This study is to describe and explain how the intrapreneurial spirit can boost the wealth within the organization. Using the general traits of marketer and manager to be analogies of how the intrapreneurial spirit is used to create and maintain wealth. The article used literature review to propose a conceptual framework about intrapreneurial spirit in terms of wealth creation and maintenance. There are three issues raised in this study, first is the relevance between marketers, managers and wealth creation which shows that marketers’ traits have impacts to wealth creation but not managers’ for instance. Secondly, is the relevance between marketers, managers and wealth maintenance, which shows that marketers’ traits have limited impact towards organization’s wealth maintenance but the managers’ traits will take place as important in wealth maintenance activities. Thirdly, how marketers’ and managers’ traits have relevance with the intrapreneurial spirits, which means that intrapreneurial spirits are drawn in both traits groups either in wealth creation activities by marketers and wealth maintenance activities by managers. Keywords: marketers, managers, wealth creation, wealth maintenance, intrapreneurial spirit
INTRODUCTION Motivation in establishing a business varies according to the personal life, environment and values. Creating wealth may be one of the motivations among the entrepreneurs in many countries. They may start their own business because of dreams to have better life, richer and wealthier. It cannot be judged as a wrong motivation because the result of entrepreneurial activities in a country can boost the economy and obviously increase the quality of life, happiness and wealth of people impacted by the entrepreneurial organizations. Wealth as defined in many ways and one of the definition is by Heilbroner (1987) in Enderle (2009) as a fundamental concept in economics indeed perhaps the conceptual starting point for the discipline. Creating wealth is not the work of the entrepreneur as the owner of business entity only, but these days, the existence of intrapreneur is considered as important and supportive to the continuity of the business. In a transition economy, every firm needs to consider its networks (Peng, 2001). An entrepreneur, as a founder, should create its entrepreneurial organization successfully, because the business should be continued under various condition and run by the people who have the same spirit as the owner or founder. The problem of small, medium enterprises (SMEs) is commonly about how to make decision because the founder has only a few subordinates (Konorti, 2010). Practically, founders need
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people to share and continue their passion because founders do not have all the answers and should listen to the feedback to improve themselves or their business (Barringer & Ireland, 2012). The need of employees with entrepreneurial spirit then becomes urgent especially when the organization becomes larger. A larger firm will require more departments, such as finance, marketing, human resources, production, and others that applicable to the respected department. The most active department in creating wealth is marketing. Undoubtedly, marketers of a firm are recruited under many requirements, not only technical, theoretical but also practical. Most of them are hired if they have eagerness to work hard and learn, perseverance and persistence in pursuing the target. It doesn’t mean that other departments do not have targets or hired without strict standards as those for marketing department, but as wealth of a firm mainly comes from the ability to gain profit from sales, thus marketers are people whose job descriptions are mainly to sell products or services and get money from that activity. Scarborough (2011) also explained that marketing function cuts across the entire company and affecting every aspect of its operation as well as the company’s success. This article aims to describe and explain how the intrapreneurial spirit can boost the wealth within the organization and how the general traits of marketer and manager can be analogies of how a firm creates and maintains wealth. The further aim of this study is to develop a model of the relationship between intrapreneurial spirit, marketer, manager and wealth creation. LITERATURE REVIEW Wealth Wealth can be described in many forms, but it is important to relate the financial capital and human capital when mentioning wealth for entrepreneurial organization. Monetary is important but less effective if not combined with high quality of skills to use the financial or the capital (Markley & Low, 2012). Drucker (1987) in Konorti (2010) found that to create wealth, survive and sustain the business, it requires that small-medium enterprise (SME) establish the strategic initiative such as professional management to lead to competitive advantage. Wealth Creation Wealth creation Enderle (2009) proposed a wealth creation concept as shown in Figure 1 below:
Figure 1. Wealth Creation Source: adapted from: Enderle, George (2009:287)
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From Figure 1, creating wealth is not the same as possessing or acquiring but making something new and better. Wealth itself can be physical, financial, human and social capital either from a private wealth to a public wealth or other the way around. When one wants to create wealth, the process can be started by production to distribution or distribution to production. The aspect of wealth can be from material and then spiritual or vice versa. Wealth also has time horizon that sustainable in terms of expanding real freedoms that the people enjoy. However the motivation of people to create wealth usually is for self-interest, joy of finding, entrepreneurial spirit and service to others. Maintaining Wealth (Wealth Maintenance) Economists have adopted a wealth maintenance concept of income (Bragg, 2010). This concept underline that the income is the maximum amount to consume during a period and leave the company with some amount of wealth at the end of period. In other words, in micro level, wealth management is about how to manage financial and assets in a company, not limited in investing but includes managing all things regarding the company’s financial activities, so there must be planning and goals to reach. As there are five pillars of wealth management, wealth protection, wealth maintenance, wealth accumulation, wealth enhancement and wealth distribution, it shows that wealth management is not only about how to gain it, but also how to manage what a company has gained it considers as wealth, maybe it’s about money, human resources or else. A company will protect what it gets and while it protects, maintain wealth in terms of healthy financial position is the stepping stone towards wealth creation (Ee, 2008). If a company can maintain it well, especially about the financial things, the positive cash flow will help it to build wealth. Maintaining wealth needs persistence, discipline and good plan so the company will not waste the wealth carelessly for a short term planning and get some difficulties in the future. That is not the idea of wealth maintenance. Marketers’ Traits Marketing based on Scarborough (2011) is a process of creating and delivering desired goods and services to customers. It involves all of the activities associated with winning and retaining loyal customers. The effective marketing does not (always) require an entrepreneur’s large amounts of money, but it demands creativity, ingenuity and understanding customers’ (Scarborough, 2011). Marketing is viewed as the function to manage connection between the organization and the customers then it will contribute to financial performance, customer relationship performance and new product performance (Moorman & Rust, 1999). They also underlined that marketing function can contribute more for firm by expanding its connection through the service delivery and financial accountability. A study also shows the result that entrepreneurial firms are better in performance when marketing professionals were in senior executive positions, conducting marketing research as a regular activity and where marketing has the major role in innovation and strategic direction of the firm (Morris & Paul, 1987). Marketing then becomes an entrepreneurial process which three key dimensions such as innovativeness, risk taking and pro activeness that is not applicable for start-up ventures only but also for any size of organizations (Morris & Paul, 1987). It means, that firms with entrepreneurial spirit are indicated having marketing orientation in their operations. Marketers have important position in an organization. All the products or services, which produced by the organization, will be known by the consumers or society because of the marketers’ actions. Olensky (2015) in his article in Forbes, “4 Traits of Successful Marketing Leaders” listed 4 traits of the successful marketing leaders as: 1) revenue ownership and accountability, 2) smart adaptability, 3) customer centricity, and 4) team builders. Shortly, marketers will be revenue oriented, adaptable to a change creatively and smart, able to champion the voice of customer and able to work in a team whose focus is in a specific areas.
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Comstock et al. (2010) in their article published by Harvard Business Review wrote about the roles or marketers in a company as they realized that products would not sell themselves. Those roles are: 1. Instigator, marketers should think strategically and will be willing to push change. 2. Innovator, marketers expand beyond product features and functionality, pricing, delivery and customer engagement. 3. Integrator, marketers act as a translator making customer insight relevant and meaningful to people in the organization. 4. Implementer, marketers build coalition and persuade others using teamwork. Managers’ Traits Manager is the one who has subordinates, provides directions to any action, is the decision maker in any endeavor that the definition is according to the management as the process of setting and achieving organizational goals through its functions such as forecasting, organization, coordination, training and monitoring-evaluation (Popovici, 2012). The need of managers or professional managers becomes more specialized, so Drucker (1958) in Konorti (2010) stated that the professional managers do not depend on “opinion” and Schumpeter (1942) in Konorti (2010) argued that managers simply draw conclusion from known circumstances and the control function consists of correcting single deviation from a predetermined course. It means that managers will be able not only to plan, budget, organize, staff but also to control and solve problems. Those ability should be owned by managers who work in entrepreneurial firms. Rowe (2001) mentioned some characteristics of managerial leaders that in this article are considered as manager itself, are reactive, acting as regulators and conservators or the current state of their organization, involved in situations and contexts characteristics of day-to-day activities. Managers usually feel comfortable in functional areas of responsibilities and possess more expertise about their functional areas. They also focus on managing the exchange and combination of explicit knowledge and ensure the compliances to standard operating procedures. Regarding the wealth maintenance, Rowe (2001) underlined that managerial leaders or managers, will maintain the wealth that has been created and may even be a source of wealthdestruction in the long term, although they do not create wealth. Intrapreneurial Spirit Intrapreneurship is another issue after entrepreneurship. Entrepreneurship itself is defined as the process by which individuals pursue the opportunities no matter the resources they currently control (Barringer & Ireland, 2012). Another definition of entrepreneurship is translated from French which means “one who undertakes” or easier to say as “a doer” (Dollinger, 2008). Although it is not easy to define entrepreneurial, but some literatures underline that entrepreneurial has the linkage to personal need for achievement, locus of control and risktaking propensity (Dollinger, 2008). Personal need for achievement is identified as a strong desire to solve problems, achieve the goals that they enjoy to set up. Locus of control is associated with belief of fate or efforts, obviously the business person should believe his/her personal effort not fate. So, the third entrepreneurial definition is linked to the risk taking propensity as the result of the efforts. Although risk-taking propensity is not a distinguishing characteristic or entrepreneurs (Dollinger, 2008), but an entrepreneur must be better in risk-taking than others. As entrepreneurship generally refers to owning a venture, intrapreneurship is becoming very important in today’s economy to enable organization in developing new products or services and creating innovative and creative technology and systems. Intrapreneurship is defined as the development of internal markets and relatively business units that produce products, services, or technologies by employing the resources in a unique way (Dollinger, 2008). It is not about how to solve the current problem with more effective and efficient ways but should be about
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producing something new for organization and gives the freedom to initiate and try the new ideas. The existence of intrapreneurship in an organization is crucial because organization or firms are facing the changing external and internal environment thus intrapreneurship will provide an ability to adapt to the new environment. However, intrapreneurship has constraints because of the rules, procedures and bureaucracy that restraint the incumbent products or services and current situation from changes. Intrapreneurship defines as the initiation and implementation of innovative system and practices within an organization (Maier & Zenovia, 2011). Because intrapreneurship lies within an organization, some of the staff will take the role with a goal to improve the economically organization performance. Based on Antoncic & Hisrich, (2003) cited in Maier & Zenovia (2011), the decision an intrapreneur takes, uses he resources of the company and it is different than entrepreneur who uses their own resources to make a risky decision. The advantages of being an intrapreneur are regarding the ability to stay in a well-known environment, lower risk, using companies resources and access to customers and infrastructure (Maier & Zenovia, 2011). Besides those advantages of being an intrapreneur, Istocescu (2003) in (Maier & Zenovia, 2011), the existence of intrapreneurship helps to improve the economical and financial performance of the company where it lies in by using the application of a more efficient use of company’s resources and suitable employee motivational system. However, intrapreneurs in organization should be managed so that they won’t be disruptive to organizations. The characteristics of intrapreneurs, basically are as described by Wong (2008), such as: 1. Innovative for the gain of the company and its share holders 2. Like to push the envelope of the status quo 3. Like to reinvent 4. Put their entrepreneurial instincts to work within the business environment they are employed in 5. Turn work into play, analysis into creativity and dedication into passion. 6. The desire to leave a mark and make a difference 7. Need to find new challenges from time to time In “Perspectives on Employee Passion” by The Ken Blanchard Company (Wong, 2008), as an employees, a passion is defined as the positive state of mind resulting from perceptions of worthwhile work, autonomy, collaboration, growth, fairness and connectedness with leader, all of which lead to standards of behavior that include discretionary effort, long-term commitment to the organization, peak performance, low turnover and increased tenure with organization. The gains of intrapreneurial performance are possibly measured by number of new products or services created, revenue stream generated from entrepreneurial products or services and return on investment from entrepreneurial projects (Luke, et al., 2007). The measurement of intrapreneurs’ activities within organization are seemingly seen from the relevant business units, not viewed as a reflection on the organization as a whole, either for financial or non-financial objectives. RESEARCH METHODs This study is conducted in qualitative study and the collecting data method used is literature study. The literatures vary not limited by time range of publication or type of publication. The main variables to be analyzed here are the traits of marketer, traits of manager, wealth creation, wealth maintenance and intrapreneurial spirit. The data collected are then analyzed to raise a conceptual model and findings.
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RESULTS AND DISCUSSION According to the literatures studied in this article, some characteristics are drawn from various experts. 1. Marketers’ traits Marketers’ traits in this study are summarized from many literatures used. The traits are used to indicate marketers in order to successfully create wealth for organizational. Based on some literatures, below are traits that proposed here: a. Revenue ownership and accountability (Olenski, 2015; Moorman & Rust, 1999) Modern marketers need to show how marketing activities impact directly to the company performance by generating income, more customers and better image that can be considered as the wealth. Following the literature, the wealth refers mainly to income or other monetary things. Marketers also need to be accountable for company’s success in terms of revenue produced from sales. b. Smart adaptability (Olenski, 2015) Market sensitivity is another terms to explain about smart adaptability for a marketer. It is because of the changing situation in which the marketers usually face. The ability to adapt needs a smart and distinguished capacity. c. Customer Centric and Integrator (Comstock et al., 2010; Scarborough, 2011) Regarding the external changes in accordance with customers’ preferences and demand, a marketer needs to be focus on customers’ needs or wants. The Integrator as Comstock et al. said (2010), means that marketers act as a translator between customers’ needs or wants and the people within company to deal with the customers’ needs. Therefore, customers will be stimulated to buy the products or services offered and bring profit for company. d. Instigator The changes of customers and other situation externally urge the marketers to think strategically and do changes if necessary. The marketers should be brave to do it. e. Innovator and Creative (Comstock et al., 2010; Scarborough, 2011) Innovator here refers to the expansion beyond the product features by the marketers. They also expand their creativity in functions, pricing, delivery system and how to engage with customers because they have to be revenue oriented. Thus their creativity and innovations in the ways to accomplish marketing activities should exist. f. Risk taker (Morris & Paul, 1987) Marketers should have sense of risk-taking because it is one of entrepreneurial process to be pro activeness and apply it to the company. In accordance to the innovativeness and creativity, sometimes to create something new, a risk should be taken and marketers, mostly, are required to have this trait. g. Pro active (Morris & Paul, 1987) As it is relevant to the other traits proposed in this study, pro-activeness of marketers are very important to get the insight from customers and other environment elements and translate it into policies, strategies, ideas or opinions which can be handled by the people within company such as production lines or R & D officers to translate the wants or needs of customers to the real products or services. h. Team work (Morris & Paul, 1987) To create wealth, marketers cannot work alone. Team work and collaboration with colleagues either in the same or different departments in company are needed. As explained above, what the marketers catch from the customers will be transferred to other departments to accomplish as products or services. Therefore, marketers will work in team with other departments in company to successfully generate wealth through income from selling products or services made and prepared by other department 2. Managers’ traits
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Manager has subordinates and direct them to act and he/she often has to make decision according to the management’s process to achieve the goals. Generally, the basic traits of managers are: a. Directive (Popovici, 2012) Managers must be able to direct their subordinates to finish all tasks based on the company’s goals. Managers must understand the vision, missions, policies and goals of the company as a whole or departmental-based policies. To understand it, managers need to have the commitment to the company well. b. Decision maker (Popovici, 2012) Having known the policies based on company’s vision and mission, managers must be able to make decision as the subordinates have to proceed the process. The ability is not about how to make decision, but how to make right decision in the right time. c. Controller (Konorti, 2010) The decision that made by managers will be executed together with the subordinates and it should be controlled by the managers as well. The control is required in any management process because it is important to ensure all processes in the company are truly based on the plans. The control is not only about the finance, budget or monetary things, but also the staffs, infrastructures and systems owned by the company. This idea is mainly caused by the paradigm that managers work in known circumstances, thus the managers will have to solve the problem appeared in the control and evaluation. d. Reactive (Rowe, 2001) As the regulators and conservators, the managers become reactive because they have to work in day-to-day activities and based on the standard operating procedures. 3. Traits needs to create wealth Wealth creation as ultimate goal of entrepreneurs needs some traits to make it happen. Not only about financial, wealth can take form as human capital as well as other assets belong to company, but in this study mainly about the financial or monetary thing. a. Able to make something new (Enderle, 2009) Creating wealth needs ability to make something new not only ability to possess or require. The creativity and innovation then are going to be the important thing in this activity. b. Able to make something better (Enderle, 2009) Innovation and creativity are not enough to complete the wealth management process in the company. The other difficult thing is how to make the company better through wealth creation. New start-up venture focuses on making something new to get wealth, but the established company, based on its engagement to customers, the analysis of the environment, and even evaluation will always need to renew, revise and re-create the ways to gain wealth. So, the other trait needed for wealth creation is ability to make something better. 4. Traits needs to maintain wealth a. Professional managerial (Konorti, 2010) Maintaining and sustaining wealth needs professional management handled by managers to lead to company’s competitive advantage. b. Persistence (Ee, 2008) Maintaining wealth needs persistence to keep the company on the track in using the financial, human resources and other assets owned by company that considered as wealth. The managers, especially, as the controller, will pay attention for the running of company in daily basis. c. Discipline (Ee, 2008)
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As fundamental concept in economics, wealth needs the discipline to work with for company’s future performance. Standard of operating procedures are the framework in managing the wealth owned by the company. 5. Intrapreneurial spirit Breaking down from entrepreneurship, the term of intrapreneurship has the same spirit for contributing to the company’s success, however intrapreneurship is important thing these days because the entrepreneur as the founder of a company cannot work alone in daily basis with the same spirit. Entrepreneurs have basic traits, such as innovative, creative, risk taker, persistence, sensible to market change and customer oriented, while intrapreneurs are people who have entrepreneurs’ traits but they are working for an entrepreneur in a company scope. As wealth creation is no longer a basic work of an entrepreneur, intrapreneurs take in to account to handle the tasks from creating wealth to maintain and even expand the wealth. The spirit of intrapreneurs to boost their activities in running business and ensure the company runs well, raised in this study are: a. Initiative (Maier & Zenovia, 2011) Following the entrepreneurship traits, intrapreneurship also needs initiative to implement the system and practices in the company whatever the position of the employee is, in this study, either as marketer or manager, initiative is required. b. Implementation (Maier & Zenovia, 2011) The initiative must be followed by the dedicated implementation. Intrapreneur must eager to take action and duties based on planned strategies and goals. c. Ability to stay in known environment (Maier & Zenovia, 2011) All the initiatives and implementations by intrapreneurs in company, need a persistence to stay in known environment either the environment is advantageous or not for the company, the resistance in uncomfortable situation will make the strategies are done well as planned. d. Ability to use company resources (Maier & Zenovia, 2011) Even though the internal and external situation are good and profitable, the ability to use company resources is also required. It is necessary to avoid the waste because the employees have lack of knowledge about the assets or resources management. Intrapreneurs need the ability very much. s e. Have access to customers (Maier & Zenovia, 2011) One of the company’s wealth sources is its customers. The access to customers is required as it is important to understand what the customers wants and needs, then the people within organization will translate it into the products and services offered in the market. The ability to understand customers value is the reference to put the new ideas into action and satisfy the customers. Satisfied customers will tend to buy the products and services offered by the company and instantly, the income will flow into the company. The intrapreneurs within the company have the customer oriented sense while they work, regardless their positions directly related to customers or not. f. Have access to infrastructure (Maier & Zenovia, 2011) Having the customers and good financial performance should be supported by the good infrastructure to run the business well and satisfy the stakeholders. The intrapreneurs should have the access to infrastructures owned by the company and then exploit it in a responsible way. Infrastructure, as an important component of a company should be managed by the people who understand the characteristics of the company. g. Creative (Wong, 2008) All the resources of a company need creative people to manage and exploit it. The creativity tends to enhance the capability of the company to compete in the market and win the consumers’ hearts. The employees with intrapreneurship senses will ease the process of making things better and more valuable.
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h. Challenge seeker (Wong, 2008) Intrapreneurs are challenge seeker, because they have to think creatively and innovatively. The challenge they seek is about the ways of how to make the company better in the future. Thus, the challenge sometimes is not a thing focuses on threat or weakness but the opportunity and strengths of the company. i. Collaborative (Wong, 2008) The collaborative is the mind for intrapreneurs to enhance their capabilities in using resources and adapting to the environment internally or externally. Collaborative will create the various perception and maybe, bring the new ideas. j. Team work (Wong, 2008) Team work will be the thing the usually an intrapreneur considers, because team work make them work stronger, faster and smarter as many collaborative mindsets and perception involved into the team. Intrapreneurs are seldom to work individually. k. Commitment to organization in long term (Wong, 2008) The long term commitment to organization or company is very important to stay within an intrapreneur. As entrepreneur will be easily to leave their business even though in a risky situation, an intrapreneur will be required to do the same thing. Loyalty and dedication to the current company where the intrapreneur works in, is very important. They cannot just have the ideas for new products, services or methods to work and leave the company without beginning to implement and ending it with evaluation. Thus, usually, intrapreneurs are very loyal to the company and sometimes, they think as if the company belonged to them. Based on the theories and concepts that previously studied and stated by the experts, then this study needs to summarize and compile all the theories used. The findings, drawn qualitatively from the concepts in the literatures, are divided into three concepts, such as: the relevance between marketers, managers and wealth creation; the relevance between marketers, managers and wealth maintenance; and the relevance between marketers, managers and intrapreneurial spirits. All the three concepts underline the marketers and managers’ traits in terms of wealth creation, wealth maintenance and how those traits are supported by intrapreneurial spirits. The relevance between marketers, managers and wealth creation is underlined that marketers’ traits as the creator traits are important in this step. Wealth creation is the first step when a start-up business starts, thus it needs the “warriors” to fight in the competition as war field by understanding company’s customers and environments, then translate into understandable language and share it to other people in company to support the competition. When they win, they can contribute to company the wealth through sales they make. As the “warriors” marketers will use their strategies, “weapons”, energy and people during the fight until the wealth is created. Managers in the other side, are not the wealth creator because they have to play as regulator and controller for all activities done within the company. It does mean, managers are not important in wealth creation. Managers should be good team to marketers in terms of regulating and controlling the activities done by marketers to keep the company’s vision, missions, goals and strategies. Markovska (2008) stated that to survive, a company should follow the rules, such as being innovative, resourceful, finding and using allies, coalition, and have policies and procedures. It means, being innovative and creative is not enough without policies and procedures. The relevance between marketers, managers and wealth maintenance, as the second finding basically focuses on the role of managers as regulators and even controllers. The managers may not contribute too much in wealth creation compared to marketers, but managers will be able either to two-fold the wealth created by marketers or even destroy it before it can be
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used by the company. Good managers will play as protectors to the company’s wealth, either money, human resources or assets owned by company that considered wealth. Marketers, in the contrary, may have a small portion in the wealth maintenance part because of its nature to fight externally. They need to follow the rules in creating wealth so that the managers can support all the result as well as infrastructures that company owned and manage it to be useful for company, otherwise, managers will ignore the result gained by the marketers. The relevance between marketers, managers and intrapreneurial spirit, the third finding is about how the intrapreneurial spirit are spread into both marketers’ and managers’ traits in wealth creation and maintenance. Intrapreneurial spirit needs creativity, challengeseeker, initiative, collaborative, team work, access to customer and infrastructures and ability to implement the business and management concepts into the real, includes the planning to the evaluation and control process as well as having commitment to the company. The model raised in this study as shown in Figure 2 below: Intrapreneurial spirit Initiative Implementation Ability to stay in known environment 4. Ability to use company resources 5. Have access to customers 6. Have access to infrastructures 7. Creative 8. Challenge seeker 9. Collaborative 10. Team work 11. Long term commitment to organization 1. 2. 3.
Marketers’ traits 1. Revenue ownership and accountability 2. Smart adaptability 3. Customer centric and integrator 4. Instigator 5. Innovator and creative 6. Risk taker 7. Pro active 8. Team work
Wealth creation 1. Able to make something new 2. Able to make something better
Wealth maintenance 1. Professional managerial
2. Persistence 3. Discipline
Managers’ traits 1. Directive 2. Decision maker 3. Controller 4. reactive
Figure 2. Model of Intrapreneurial spirit in wealth creation and maintenance Source: Author
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Figure 2 is about the model Intrapreneurial spirit in wealth creation and maintenance as the result of the study. The intrapreneurial spirit will influence and be drawn to the marketers’ traits and managers’ traits. Marketers’ traits are then relevant to the traits used to create wealth and managers’ traits will be relevant to be used in maintaining wealth. Wealth creation and wealth maintenance are inseparable as both of them are included in wealth management. Without both wealth creation and maintenance, wealth management is not applicable. CONCLUSIONS The study about creating wealth like a marketer and maintain it like a manager with intrapreneurial spirit in practice of wealth management discussion, to describe and explain how the intrapreneurial spirit can boost the wealth within company using the analogies of marketers’ and managers’ traits in creating and maintaining wealth, concludes the results with three issues, the relevance between marketers, managers and wealth creation which shows that marketers’ traits have impacts to wealth creation but not managers’ for instance. Secondly, that in the relevance between marketers, managers and wealth maintenance, marketers’ traits have limited impact towards organization’s wealth maintenance but the managers’ traits will take place as important in wealth maintenance activities. Thirdly, the description of how marketers’ and managers’ traits have relevance with the intrapreneurial spirits, which means that intrapreneurial spirits are drawn in both traits groups either in wealth creation activities by marketers and wealth maintenance activities by managers and then it can boost the wealth creation in the next stage of company. LIMITATION OF THE STUDY The study uses literature study in qualitative approach which numbers of literatures are very limited. Notwithstanding, the trait components and model raised in this study can be ideas to further study using quantitative approach with exploratory factor analysis, multiple regression analysis or other techniques to generalize the results. The relevance items listed in marketers’ traits, managers’ traits, wealth creation, wealth maintenance, and intrapreneurial spirit are openly to be developed in the further study. . REFERENCES Barringer, Bruce R & R. Duane Ireland. (2012). Entrepreneurship: Successfully Launching New Ventures. Fourth Edition. Pearson Education, Inc: USA Bragg, Steven M. (2010). GAAP 2011: Interpretation and Application of Generally Accepted Accounting Principles. John Wiley & Sons, Inc: USA Comstock, Beth, Ranjay Gulati, Stephen Liguori. (2010). Unleashing the Power of Marketing. https://hbr.org/2010/10/unleashing-the-power-of-marketing. Accessed on 14th June 2017 Dollinger, Marc J. (2008). Entrepreneurship: Strategies and Resources. Fourth Edition. Marsh Publication: Illinois, USA Ee, Vincent. (2008) Five Pillars of Wealth Fundamental Elements of Your Financial Success. Asia Financial Planning Journal , Volume 09, Issue 04 (Dec., 2008). http://www.fa.com.sg/sites/default/files/files/interview_vincent_ee_%283pp%29.pdf . Accessed on June, 22th 2017 Enderle, Georges. (2009). A Rich Concept of Wealth Creation Beyond Profit Maximization and Adding Value. Journal of Business Ethics (2009) 84:281-295
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Konorti, Eli. (2010). The Relationship between Wealth Creation and Professional Management in Small-Medium Enterprises. The Journal of American Academy of Business, Cambridge. Vol. 16, Num. 1, September 2010 Luke, Belinda, Martie-Louise Verreynne, Kate Kearins. (2007). Measuring the Benefits of Entrepreneurship at Different Levels of Analysis. Journal of Management & Organization (2007) 13: 312-330 Maier, Veronica & Cristiana Pop Zenovia. (2011). Entrepreneurship versus Intrapreneurship. Review of International Comparative Management. Volume 12, Issue 5, December2011 Markley, Deborah M & Sarah A. Low. (2012). Wealth, Entrepreneurship and Rural Livelihoods. Choices, The Magazine of Food, Farm and Resources Issues. 1st Quarter 2012, 27 (1) Markovska, Monika. (2008). Intrapreneurship-Way of Work in Organizations for Improvement of Working Quality. Proceeding a 5th International Scientific Conference Business and Management 2008 Moorman, Christine & Roland T. Rust. (1999). The Role of Marketing. Journal of Marketing Vol. 63 (Special Issue 1999), 180-197 Morris, Michael H & Gordon W. Paul. (1987). The Relationship between Entrepreneurship and Marketing in Established Firms. Journal of Business Venturing 2, 247-259 (1987) Olenski, Steve. (2015). 4 Traits of Successful Marketing Leaders. Forbes, Jan 7, 2015. https://www.forbes.com/sites/steveolenski/2015/01/07/4-traits-of-successful-marketingleaders/#f1260513fde8 . Accessed on June 12, 2017 Peng, Mike W.(2001). How Entrepreneurs Create Wealth in Transition Economies. Academy of Management Executive, Vol. 15, No. 1. Popovici, Virgil. (2012). Similarities and Differences between Management and Leadership. Annals of the Constantin Brancusi, University of Targu Jiu, Economy Series, Issue 2/2012 Rowe, Glenn W. (2001). Creating Wealth in Organizations: The Role of Strategic Leadership. Academy of Management Executive, 2001. Vol. 15, No. 1 Scarborough, Norman M. (2011). Essentials of Entrepreneurship and Small Business Management. 6th Edition. Pearson: USA Wong, Wendy. (2008). Managing and Motivating Intrapreneurs. The Ken Blanchard Companie: UK Yu, Jim. (2014). Study: Marketers’ Roles are Changing. What They need to Succeed. http://marketingland.com/marketing-roles-rewards-featuring-adobe-insights-82485. Accessed on 14th June 2017
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KEDAI NOTJAP BUSINESS PLAN WITH CANVASS BUSINESS MODEL 1
Wike Laurenzia Warrauw
Ciputra University Surabaya INDONESIA E-mail:
[email protected]
ABSTRACT Food that contains carbohydrates are kinds of food that is loved by Indonesians. Always sought after to eat and make oneself feel full. People always look for this type of food to satisfy their hunger in the middle of their break time. Due to its popularity, it will attract people to start their own small to medium food business. Kedai Notjap is a new startup in carbohydrate and pork based food. Kedai Notjap work their best to create the best food, high quality taste and a unique yet stunning appeal for their customers. In order to compete with others pork based food restaurant, Kedai Notjap must attract people by creating a unique food, good taste, creative serving, wide range of menu and great verall appeal. Kedai Notjap provides questionnaires to collect informations such as; whether the food is at it’s best quality or not and to know what people want to see in our menu. Kedai Notjap is located in Mal Ciputra World and targeted the middle - up wealthy families In West Surabaya. Keyword: Menu variations, carbohydrate, pork based food INTRODUCTION This research was conducted based on the author’s experience when first observing the business opportunity at Ciputra World Mall Surabaya. At that time, the author realized that there had been no pork-based food available in the mall, thus this had motivated the author to design a business plan in form of attractive and unique pop up stand that sells pork-based foods. Food business is one developing businesses due to the everlasting food industry (Wijaya, 2015:2). Based on Statistics Indonesia, 2015, population of Surabaya reached 2,848,583 citizens with 1,406,683 men and 1,441,900 women, so it is concluded that people in Surabaya are still appropriate as target market. The author wants to make consumers interested with a unique concept of pop up stand that demonstrates how to prepare take-home food for consumers. The packaging is very simple and easy to carry so the consumers can choose whether they want to eat on the go or sit comfortably on the seats provided by the stand. The market target for this business idea, as desired by the author, is consumers with age range 16 to 54 years old, assumed that they are productive and have a desire to taste new food. By targeting this group of consumers, the author wants to introduce old fashion food or legacy food as well as to preserve it. Based on those considerations, the objective of conducting this research is to design a business plan under the name Kedai Notjap. LITERATURE REVIEW
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Osterwalder and Pigneur (2012:12) define business canvas model as portraying, visualizing, valuing, and changing business model. This concept can become a term or language for sharing ideas that allow us to easily describe and manipulate business model into new alternative strategies. Value proposition is the value that a business wants to give to its customer segments (Priyono, 2015). Regarding this, Osterwalder and Pigneur (2012:14) state that customer segment building blocks describes a group of people or different organizations a company wants to reach or service. Customer segments explains how a company chooses the most potential customer segment to choose in order to run business activities on target and be appropriate with the desired consumers target. Kodrat (2009:184) then adds that segmentation is a mapping strategy with clear market definition. Channel is a way to distribute products to the public (academia.edu). Mehta, et al. (2010:05) argue that finding the right channel to satisfy customers’ needs is a crucial part for the company in delivering its value propositions. Customer relationship is the kind of relationship built between company and customers of a specific market segment (Khairizza, et al., 2015). Elements of revenue streams is description of income flows generated by the company from each customer (Pratami, et al., 2016). According to Solihah, et al., (2014), key activities are important actions that a company must take in order to operate successfully. Key activities are required to create and deliver value propositions, reach the market, maintain good relationships with customers and ultimately generate revenue. Another term related to key activities, key resources, describe the most important assets required to enable a business model functions. These important assets can take form in physical assets, financial assets, and human resource (Solihah, et al., 2014). Additionally, key partnership is described as relationship with third party as main partner, which is very important to make a business model operates well (Solihah, et al., 2014). Marahakim and Wandebori (2012) explain cost structure as follows: “more distribution channel will cause an increase in operational cost such as accommodation. The salary for our clerical workers is also needed to be counted as a cost, while the board is acting as a shareholder”. Distribution channels lead to operational cost increase such as accommodation, workers’ salaries, and board as shareholders. RESEARCH METHODS The author used qualitative descriptive method for the research method. Questionnaire was distributed to 30 future consumers and students located in West Surabaya in 2016, treated as samples of this research. FINDINGS AND DISCUSSIONS Value Proposition By the time this research was conducted, there was no pop up stand that sold pork based food in the Ciputra World mall, which is why the author initiated to run a business plan in form of pop up stand that sells pork-based food with business canvas model. At that time, the stand was located in front of Contempo clothing outlet. With the total number of people in Surabaya reached 2.848.583, where 3.030.012 are Muslims and the other 818.550 are non-Muslims, the author considered this as a big enough opportunity to open a pop up stand at Ciputra World Mall which is located in West Surabaya. Kedai Notjap itself has also joined in food bazaar twice, held in Spazio and Lenmarc, so the product name is quite familiar already. By creating a unique and attractive stand, consumers themselves can witness the process of preparing food that they order. Seats are available at the pop up stand so the consumers can enjoy their food on the spot, or on the go as well. The target market is consumers around 16 years to 54 years old, since they are regarded as still in productive age and are curious of new food taste.
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Sumarsan (2013:78) explains SWOT analysis as a diagnosis of surrounding environmental factors. Internal factors of business are identified by their strengths and weaknesses, while external factors are determined by opportunities and threats exist in the business environment. The strengths of Kedai Notjap are its various foods, unique and interesting place and packaging, affordable price, and unique brand name that is easy to remember. This Kedai Notjap also has weaknesses, among others, weak brand image, poor time management, and inexperienced business owner. However, this business has opportunities to develop, such as innovating food menu to produce unique food products that can attract more consumers, and the absence of pop up stands with similar idea, which is selling carbohydrate foods in the mall. As for its threats, Kedai Notjap must pay attention to the competitors since they can challenge the existence of Kedai Notjap in form of increasing number of restaurants and raw material price. Customer Segment The location of the intended consumers can be determined by analyzing target market using segmentation, targeting and positioning of Kedai Notjap. Kotler and Armstrong (2012:214) explain about segmentation as dividing the market segment into smaller segments in terms of characteristics, or behaviors that require separate marketing strategies. Furthermore, they add that the best way to see market structure is that marketers should pay attention to different variables (Kotler & Armstrong, 2012:215). Market segmentation can be seen from several variables. The geographic variable of Kedai Notjap is 94% consumers are located in West Surabaya, therefore it is very appropriate to open a food stand in Ciputral World Mall since this mall is also located in West Surabaya. For its demographic variable, the percentage of consumers is 60% women and 40% men with age range 16 to 20 years old and the highest income for more than 2 million rupiahs. Meanwhile, for its psychographic variable, as much as 93% people are interested to try Kedai Notjap’s product. The market target of Kedai Notjap is consumers with age range 16 to 54 years old. Kedai Notjap attempts to create a unique and superior brand perception, product or business enterprise in the minds of its customers (Tjiptono & Chandra 2012: 162), by positioning itself as a pop up stand with strategic location for its consumers, and attract consumers directly by its appearance, its unique food preparation presentation, and its various food menu. Channels Channel is a relationship made by Kedai Notjap with external and internal parties. External relationship, for example, is the relationship with consumers, where Kedai Notjap will provide after sales service such as promotion for loyal customers. Internal relationship, for example, is relationship of Kedai Notjap pop up stand with its main kitchen to deliver order, take note on what is needed, and to bring order to the pop up stand. Customer Relationship Kedai Notjap attempts to strengthen relationship with its consumers by giving promotions for loyal customers. The promotions are various, such as special discounts to consumers who celebrate birthday (by showing their ID card), special discounts and promotions for church community on Tuesday, and special promo for senior consumers (buy one free one food or beverage) who come directly to the food stand and able to show their ID card. Revenue Stream The revenue of Kedai Notjap is obtained from selling made in the pop up stand and from its online business that also sells food and beverages. Key Resources
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The existence of high advanced technology has demanded culinary world to innovate continuously. Innovation done by Kedai Notjap is providing courier service to deliver food orders. Besides using high advanced technology, Kedai Notjap also needs potential and skilled workforce to support its performance, starting from cashier, food service and beverages stall, and all services. Key Activities Key activities include processes of standardizing all working performances, starting from the lowest division to the highest division, conducting workshops to improve its employees’ performance, evaluating employees’ working performance, and having morning briefing once in two weeks. These activities are conducted to improve the quality of Kedai Notjap. Key Partnership All raw material suppliers are included in key partnership sector. Raw material suppliers required by Notjap Store are suppliers from Genteng Surabaya market, Pabean Surabaya market, supermarkets, and print service business located in Lontar Street, Surabaya. Cost Structure Cost required by Kedai Notjap covers cost of renting stand or booth in Ciputra World mall, raw material purchasing, employee’s salary with 10% annual increase, religious festivity allowance, stand maintenance and renovation, and cost of employees facility. Investor Aspect Kedai Notjap is a business plan of running a pop up stand in Ciputra World Mall, Surabaya. If this business is to be established, it needs big investment, but if this business does not run well as expected, Kedai Notjap has provided a second plan to keep its name by selling the product through stand but with extreme promotion to make consumers aware of the existence of Kedai Notjap. In addition, if this second plan does not work well, Kedai Notjap still has a third plan by selling online with aim to make consumers aware of its name and product. Conclusions Kedai Notjap business design was done by implementing business canvass model with well calculation marketing. However, after conducting deeper review, this business is not recommended to open due to its high operation cost and the situation of Ciputra World Mall that is not as crowded as it is used too anymore. REFERENCES Academia.edu. Jurnal Model Bisnis Kanvas. 2015 http://www.academia.edu/15435087/JURNAL_Model_Bisnis_Kanvas Akselerasi.id. Business Model Canvas. http://akselerasi.id/media/Materi_13__Business_Model_Canvas.pdf BPS.2014.Surabaya Dalam Angka 2014. Surabaya: BPS Kota Surabaya. Kodrat, David Sukardi. 2009. Manajemen Strategi “Membangun keunggulan bersaing era global di Indonesia berbasis kewirausahaan”. Graha Ilmu. Yogyakarta. Kotler, Philip, and Armstrong, Gary. 2012. Principles of Marketing, Fourteenth Edition. Pearson Education Marahakim, Sutansyah and Wandebori, Harimukti. 2012. BUSINESS MODEL GENERATION OF MAJALAH EPIK. Marahakim and Wandebori/Journal of Business and Management, Vol. 1, No. 5, 2012:365-369
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Mohammad, R Khairizza, et al., 2015. Business Model Canvas Pada BMT Kanindo Syariah Malang. Jurnal ini merupakan bagian dari skripsi yang ditulis oleh R Khairizza Mohammad, NIM: 040914032, yang diuji pada tanggal 6 Februari 2015. Osterwalder, A., & Pigneur, Y. (2012). Business Model Generation: Membangun Model Bisnis. Jakarta: Elex Media Komputindo. Pratami, Ni Wayan Cahya Ayu, et al., 2016. Penerapan Bisnis Model Kanvas Dalam Penentuan Rencana Manajemen Usaha Jasa Pengiriman Dokumen Di Denpasar. JURNAL SISTEM DAN INFORMATIKA Vol. 11, No. 1, Nopember 2016. Priyono , Feliciana. 2015. AGORA Vol. 3, No. 2, (2015): ANALISA PENERAPAN BUSINESS MODEL CANVAS PADA TOKO MOI COLLECTION. Rajiv Mehta et.al. 2010. Managing International Distribution Channel Partners: A Cross Cultural Approach. Solihah, Eius.et.al. 2014. ANALISIS MODEL BISNIS PADA KNM FISH FARM DENGAN PENDEKATAN BUSINESS MODEL CANVAS (BMC). J. Sosek KP Vol. 9 No. 2 Tahun 2014 Sumarsan, Thomas. 2013. Sistem Pengendalian Manajemen Konsep, Aplikasi, dan Pengukuran Kinerja, Edisi 2. Jakarta: PT Indeks Tjiptono, Fandy dan Chadra, Gregorius. 2012. Pemasaran Strategik Edisi 2. Yogyakarta: ANDI Wijaya, Timotius. 2014. Tugas Akhir: Cakweria Food Truck. Surabaya: Universitas Ciputra.
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FEASIBILITY STUDY OF EXTRA NEUTRAL ALCOHOL DEVELOPMENT at PT. ENERGI AGRO NUSANTARA Geovanni Garias Pradhana, 2Christina Whidyautami♠
1
Ciputra University Surabaya INDONESIA Email :
[email protected] ABSTRACT The aim of this study is to determine whether it is feasible or not the development of Extra Neutral Alcohol in PT. Energi Agro Nusantara. This study uses qualitative descriptive method which has a primary data source. This study was conducted at PT. Energi Agro Nusantara and also PT. Indo Acidatama as a benchmarking company. Legal Aspect, Technical Aspect, Market Aspect and Financial Aspect are the aspects that was studied in this study. Benchmarking study was conducted at PT. Indo Acidatama by interviewing one of company member that in charge in Marketing, the result is as confirmation of the data that was taken from internal data of PT Indo Acidatama and also from Published data of External Entities. The Result of this study are as follows. Legal Aspect are feasible with the formal letter that issued by Ministry of Industrial Affair. Technical aspect is feasible by upgrading several equipment. Marketing Aspect is feasible by implementing penetration pricing strategy to enter the market. Financial Aspect is feasible by checking the Internal Rate of Return, Payback Period, Net Present Value, Benefit Cost Ratio, Profitability Index and Break-Even Point meet the requirement. Keywords : Extra Neutral Alcohol, Feasibility Study, Sugar Industry
INTRODUCTION The sharp decreasing of oil price in the world will have a significant impact to the growth of renewable energy such as ethanol. At the beginning ethanol as an alternatives energy is at the first place to change the fossil fuel energy, but currently it has been affected by the decreasing of oil prices. At that time, the ethanol price is cheaper than the oil price that increasing significantly. Every country has the ambition to conduct research and arranging regulation to use the renewable energy sources such as ethanol to replace the price of fossil fuel that becoming expensive day by day. But today the ambition is different because of the fall of oil prices, and currently the ethanol price is becoming more expensive than the price of fossil fuel that is decreasing day by day. PT. Energi Agro Nusantara (Enero) has been in ethanol fuel-grade market since 2014. Even though Enero committed to provide ethanol to fulfill the demand of fuel-grade ethanol in Indonesia, the oil company as the customers of Enero, has not implemented fuel-grade ethanol as the mixed of gasoline. Because of that reason, Enero exporting the product to the international market since 2014, but at the end of 2015, the molasses price was soaring high to Rp 1,800 per Kg, from Rp 1,000 per kg in 2013. It means the production cost is increasing sharply, the cost of raw material only is about Rp. 7,200 per liter of ethanol. In line with the fall of the ethanol price, Enero decided to stop the export because of the price of ethanol is lower than production cost itself.
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The ambition of Indonesia in implementing the renewable energy such as fuel-grade ethanol, that has been regulated in Regulations of Energy and Minerals Ministry no 15 2015 cannot be implemented. Enero has been appointed by government to provide fuel-grade ethanol to Pertamina. Pertamina itself has a doubt to implement offtake the ethanol because of cheaper oil prices currently. This condition increases the risk of fuel-grade ethanol continuity, hence Enero as the producer of fuel-grade ethanol has to has strategy to ensure the sustainability of the company. Enero has no other choice than developing Extra Neutral Alcohol (ENA) to ensure the sustainability of the company, ENA is high-grade ethanol with the lowest impurities, its usage is very wide such as for cosmetics industry, food and beverages industry, perfume industry and pharmaceutical industry. By diversifying the product, Enero will reduce the dependency to fuel market and ensure the operation stability of the plant, it means Enero as a company will grow well. LITERATURE REVIEW Previous Research Goncharuk, Anthony G. (2013) has conducted the research of benchmarking, organizational culture, strategic ideas, marketing business process and key marketing performance measures are becoming the object of benchmarking of the Ukrainian pharmaceutical companies. It has an aim to determine the best practices and possibilities of their use for the purpose of improving performance outcomes of companies participating in the research. The Research showed that the differences of mission, vision and strategic aim are applied to the three pharmaceutical companies. Market takeover has become the strategic aim of global company while retaining their market position has become strategic aim of the local company. The research showed that local company’s management does not consider marketing as a driving force of the development and sales growth, that is why company lacks of marketing culture and marketing department as such has been substituted with sales and distribution department. The Authors find the urge of structural changes in order to develop, yield profit and avoid attainment by local pharmaceutical company using the better practice of the global companies Feasibility Study A feasibility study has objectives to objectively and rationally discover the strengths and weaknesses of an existing business or proposed venture, opportunities and threats present in the environment, the resources required to carry through, and ultimately the prospects for success. In its simplest terms, the two criteria to judge feasibility are cost required and value to be attained. A good feasibility study has to provide a historical background of the business or project, a description of the product or service, accounting statements, details of the operations and management, marketing studies and policies, financial data, legal requirements and tax obligations. Generally, feasibility research predates technical development and project implementation. A feasibility research to study the project for success; therefore, recognized objectivity is most important factor in the credibility of the study for potential investors and lending institutions. It must be conducted with an objective, unbiased approach to provide information upon which decisions can be used. Financial Aspect Conducting feasibility study, financial aspect is the most important aspect. The Financial aspect providing quantitative indicator that will confirming whether the project is feasible or not. The indicator that will be used in financial aspect are as follow: Net Present Value is an indicator of the profitability of an undertaking that is calculated by reducing the present values (PV) of cash outflows (including initial cost) from the present
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values of cash inflows over period of time. Outgoing and Incoming cash flows can also be called as benefit and cost cash flows, respectively. Benefit Cost Ratio is a parameter for cost-benefit analysis, that try to summarize the overall value for money of a project or proposal. A BCR is the project or proposal benefits ratio, expressed in monetary terms, relative to its costs, also expressed in monetary terms. All benefits and costs should be stated in discounted present values. A BCR is a profitability index in forprofit contexts. Benefit cost ratio (BCR) takes into account the amount of monetary gain realized by performing a project versus the amount it costs to execute the project. The higher the BCR the better the investment. In general, is that the benefit is higher than the project cost is a well-design investment. Payback period in capital budgeting refers to the period of time required to recoup the funds expended in an investment, or to reach the break-even point. [1] For example, a $1000 investment made at the start of year 1 which returned $500 at the end of year 1 and year 2 respectively would have a two-year payback period. Payback period is usually expressed in years. Starting from investment year by calculating Net Cash Flow for each year: Net Cash Flow Year 1 = Cash Inflow Year 1 - Cash Outflow Year 1. Then Cumulative Cash Flow = (Net Cash Flow Year 1 + Net Cash Flow Year 2 + Net Cash Flow Year 3, etc.) Accumulate by year until Cumulative Cash Flow is a positive number: that year is the payback year. The internal rate of return (IRR) is a tool of calculating return rate. The term internal is the fact that its calculation does not include external factors, such as inflation or the cost of capital. Profitability Index is the payoff ratio of investment of a project proposal. It is a good tool for ranked the projects because it allows you to quantify the amount of value created per unit of investment. The break-even point (BEP) is the point at which revenue and expenses or cost are equal: there is no net loss or gain. A loss or a profit has not been made, although opportunity costs have been "paid" and capital has received the adjusted risk, expectation of return. Or it´s the point in which the total revenue of a business exceeding its total costs, and the business begins to create wealth instead of consuming it.[1] It is shown graphically as the point where the total cost and total revenue curves meet. In the linear case, the break-even point is equal to the fixed costs divided by the contribution margin per unit. The break-even point is gained when the profits generation match the total costs accumulate until the date of profit generation. Establishing the break-even point makes businesses in setting plans for the production level which it needs to maintain be profitable Marketing Aspect Marketing aspect are related to the question whether there is still a market opportunity for the product. The aspects can be seen by several things such as: a. Market potential, valued by the shape of the market chosen b. Quantity of potential consumers, these quantities can be measured by measuring and forecasting the supply and demand of the current product. c. Purchase power by calculating the development and the growth of the citizen d. Segmentation, target and product positioning e. Current competition f. Customer satisfaction of the current product. g. Marketing Management, consist of competition analysis Technical Aspect Based on Heizer and Render (2009), Production feasibility is to make sure whether the operation and production are feasible or not, on the daily routine operation and on the project basis. In terms of operation management, there are 3 things that has to be faced by the company,
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the first one is company positioning, design, operation. The implication for the feasibility study is giving the information about product strategy, technology, production capacity, layout for manufacture, production planning and product quality and also daily operation Legal Aspect This aspect will check the validity of the document related to the project and the company itself, this document checking is very important to check whether the project against the law or not. RESEARCH METHODS This type of research is qualitative descriptive study by in-depth interview. This research is gathered the data directly. This research conducted at PT. Energi Agro Nusantara as the object and PT Indo Acidatama as the chosen benchmark company Indo Acidatama has been chosen to be benchmark company because of this company is the only ethanol producer that has been listed and one of the biggest ethanol plant in terms of production capacity in Indonesia, which its quantity is reaching about 200.000 Litre per day. This study is using data collection method by in depth interview and observation. Data collection is interviewing the person that is expert as marketing in bioethanol and has been in this field for very long time. This study is to compare the performance of Indo Acidatama with Energi Agro Nusantara RESULT AND DISCUSSION Legal Aspect In Legal aspect, the ministry of industrial affairs has release the permit to develop the Ethanol Plant,with the details below : 1. Reducing the cost of production a. By installing bio methanated spentwash to reduce the waste water volume b. Conducting the integration of waste water treatment with the sugar mill c. Installing Yeast Separation System 2. To increase revenue of the company a. Installing CO2 Recovery Plant, to produce Liquified CO2 b. Bioethanol diversification, by producing industrial grade ethanol With the permission from the ministry of industrial affair, the legal aspect is feasible. Technical Aspect Current existing plant has the weaknesses that has implication on ethanol plant for producing ENA, it is because of its contaminant that will create the high acidity that will produce defect ENA. The other weakness is a lot of inefficiency of energy and steam, a below standard yield that has consequences of low rate ENA production. Considering the weaknesses above, there will be modification as follows : 1. Fermentation Section • Existing Fermentation Section will be converted to operate on PRAJ’s Combiferm Technology. • Existing Two Propagation Tanks will be operated as Yeast Vessel 4 with addition of New Coolers (PHEs) and Recirculation Pumps. • Existing Two Yeast Mud Tanks will be operated as Yeast Activation Vessels with addition of New Coolers (PHEs) and Recirculation Pumps. • Existing Six Fermentation Tanks will be operated as ‘Biostat Reactors’ along with its Accessories as it is. • Existing Three Storage Tanks will be operated as ‘Chemostat Reactors’ with addition of New Heat Exchangers and Recirculation Pumps. • Existing Single Storage Tank will be operated as ‘Beer Well’.
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•
New Yeast Culturing System consisting of Yeast Vessel 1, Yeast Vessel 2 and Yeast Vessel 3 will be added along with its Accessories. • Existing Chiller based Cooling Water System will be discontinued and Fermentation will be operated on Cooling Water based System to reduce Steam and Power Consumption by Chiller System. Existing Cooling Tower Capacity is found to be sufficient for this Modification. • Piping & Valves, Instrumentation & Control and Electricals will be modified / replaced to suit the Modified Process Philosophy. 2. Distillation Section • Existing Distillation System will be converted to PRAJ’s Multi Pressure Technology to Reduce • Steam Consumption by 1.2-1.3 Kg/Lit i.e. approximately 30-35% Reduction. • New Analyser Column, Degasifying Column and Aldehyde Column with its Accessories will be added to Existing Distillation Section • Fermented Wash will be supplied to New Degasifying Column instead of Evaporation Section after preheating it with outgoing Partially Concentred Spent Wash from Modified Evaporation Section. • Existing ‘Distillation Column’ will be used as ‘Pre-Rectifier Cum Exhaust Column’ along with its Accessories. • Heat Energy required for Existing Pre-Rectifier Cum Exhaust Column will remain as it was before. • Heat Energy from Top of the Existing Pre-Rectifier Cum Exhaust Column will be used to Supply • Heat to Existing Evaporation Section which in turn Supply Heat to New Analyser Column. • Heat Energy from Top of the New Degasifying Column will be used to Heat the New Aldehyde Column and thus Aldehyde Column does not require Additional Steam Supply. • Newly supplied Analyser Column, Degasifying Column and Aldehyde Column will operate under Vacuum. Required Vacuum will be created by Newly supplied Vacuum Pumps. • New Alcohol Scrubber will be supplied to strip out the traces of Alcohol from the OutgoingVapours to Vacuum Pump. Thus ensuring High Recovery of Alcohol 3. Evaporation Section • Existing Evaporation Section will be operated on Spent Wash from New Analyser Column of Distillation Section instead of Fermented Wash. • Out of Existing Four Evaporators, only Two Evaporators will be in operation at any point of time. Other Two Evaporators will remain as Stand-by. • Out of Two Evaporators which are in Operation, One will operate on Heat supplied by Existing Pre-Rectifier Cum Exhaust Column and Other Evaporator will operate on Heat supplied by Low Pressure Steam, which in turn will provide Heat required for New Analyser Column. • At regular intervals, Evaporators will be cleaned and Stand-by Effects will be taken on operation to avoid long shut down of the entire plant. • Suitable changes to be made in pipe routing to integrate Modified Evaporation Section and Modified Distillation Section.
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Final Solid Concentration o f Spent Wash will come down substantially, which shall be favorable to downstream Waste Water Treatment Plant i.e. Bio methanation. By modifying the current existing plant, the technical aspect is feasible for developing ENA product. Market and Marketing Aspect Current condition of the market in general is as below 1. Global market especially for Asia-Pacific, still need 1.5 Million Liter of ethanol, with the composition 63.9%=68.1% is ENA 2. Domestic Ethanol consumption is about 135-142 Million Liter just for ENA grade. Marketing mix for ENA project are as follow: 1. Product ENA that will be produced is as higher purities than existing market 2. Price The Price that will be released to the market is lower than existing market, this has to be done because Enero needs to penetrate the existing market, this strategy is possible because enero has the distribution channel of molasses as raw material which means it is easier to reduce cost and price. 3. Distribution Channel The Distribution channel will be through trader, and of course Enero will start opening direct sales to end user 4. Promotion The promotion will be conducted in 2 ways which are exhibition and cold calling, because the customers will be for industries. With the current condition of the market and the marketing mix strategy the Market Aspect is feasible for Enero developing ENA. Financial Aspect No
Deskripsi
1 a Net Present Value (NPV) b Benefit Cost Ratio (BCR)
c Payback Period (PP)
2 a Internal Rate of Return (IRR) b Profitability Index (PI) c Break Even Point (BEP)
Perhitungan 𝑁𝑁𝑁𝑁𝑁𝑁 = 𝐶𝐶0 +
𝐵𝐵𝐵𝐵𝐵𝐵 =
𝐶𝐶1 𝐶𝐶2 𝐶𝐶 + + ⋯+ 𝑡𝑡 𝑡𝑡 (1 + 𝑟𝑟)1 (1 + 𝑟𝑟)2 (1 + 𝑟𝑟)
𝑃𝑃𝑃𝑃 𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎 𝑘𝑘𝑘𝑘𝑘𝑘 𝑦𝑦𝑦𝑦𝑦𝑦𝑦𝑦 𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎 𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑 𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼 𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴
𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽ℎ 𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼 𝑃𝑃𝑃𝑃 = 1𝑥𝑥( ) 𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽ℎ 𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝐾𝐾𝐾𝐾𝐾𝐾 𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀 𝑁𝑁
𝐼𝐼𝐼𝐼𝐼𝐼 = −1𝑜𝑜 + �
𝑛𝑛 =0
𝑃𝑃𝑃𝑃 = 𝐵𝐵𝐵𝐵𝐵𝐵 =
𝐶𝐶𝑛𝑛 =0 (1 + 𝑟𝑟)𝑛𝑛
𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁 𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝐾𝐾𝐾𝐾𝐾𝐾 𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀𝑀 𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁𝑁 𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼
𝐹𝐹𝐹𝐹𝐹𝐹𝐹𝐹𝐹𝐹 𝐶𝐶𝐶𝐶𝐶𝐶𝐶𝐶 𝐻𝐻𝐻𝐻𝐻𝐻𝐻𝐻𝐻𝐻 𝐽𝐽𝐽𝐽𝐽𝐽𝐽𝐽 − 𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉𝑉 𝐶𝐶𝐶𝐶𝐶𝐶𝐶𝐶
Parameter Penilaian
Parameter Proyek
>0
37,213,537,590.50
>1
1.64
< 16 (umur ekonomis mesin industri menurut pajak)
3.04
> 10.25%
60.82%
>1
1.64
= 1 impas, < 1 laba
0.22
The indicators above show that all of them meet the requirement, which means the Financial Aspect of Developing ENA is feasible CONCLUSION Based on the overall feasibility study above, which are Legal Aspect, Technical Aspect, Market Aspect and Financial Aspect, it can be concluded that Developing ENA at Enero is feasible, if all the assumption can be fulfilled.
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REFERENCES Behrens,W., Hawranek, P.M. (1995) Manual for Preparation of Industrial Feasibility Studies. Vienna : UNIDO Chawla, Ankit. (2014) Feasibility Study Green Pool Commodity Specialist (2015) http://ciputrauceo.net/blog/2015/11/12/studi-kelayakan-bisnis Umar, Husein. (2007). Studi Kelayakan Bisnis Jakarta: PT Gramedia Pustaka Utama. Moleong, L. J. (2010). Metodologi Penelitian Kualitatif. Bandung: Remaja Rosdakarya. Rangkuti, Freddy. (2016) Teknik Membedah Kasus Bisnis Analisis SWOT. Jakarta: PT. Gramedia Pustaka Utama Ross, A. Ross., Westerfield, Randolph W., Jaffe,Jeffrey. (2013) Corporate Finance 10th Edition. USA : McGraw-Hill Sinaga, Dadjim,MM. (2013) Studi Kelayakan Investasi pada Proyek dan Bisnis dalam Perspektif Iklim Investasi Perekonomian Global. Jakarta: Mitra Wacana Media. Suliyanto. (2010) Studi Kelayakan Bisnis. Yogyakarta: Andi. Thomsett, Rob, 2002. Radical Project Management. Harlow/United Kingdom : Pearson Education Limited Turner, J. Rodney. The Handbook of Project-Based Management (2009). USA: McGraw-Hill. Team Fme. Porter’s Five Forces Strategy: Strategy Skills. www.free-management-ebooks.com, 2013 Wijatno, Serian (2009). Pengantar Entrepreneurship. Jakarta : Grasindo
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ROLE STRESS AND WORK-FAMILY CONFLICTS IN LIFE SATISFACTION AMONG FISHERMEN IN EAST JAVA PROVINCE Maya Ida Kesumawatie, 2Miya Dewi Suprihandari♠
1
STIE Mahardhika Surabaya INDONESIA Emails:1
[email protected], 2
[email protected] ABSTRACT This qualitative descriptive research wants to explore descriptive nonquantifiable phenomena of a diverse concept, the characteristics of a good and a service, Images, styles, ordinances of a culture, the physical model of an artifact and so forth. Each profession has different causes of role stress, so that each individual within the organization also has different levels of stress. Fisherman is one of the professions that are closely related to the stress condition due to the many role stress at work. The role of job stress arises because there are three commonly encountering conditions: role ambiguity, role conflict, and the weight of workload that leads to role overload. The severe thing experienced by fishermen in East Java province, became the research object. Keywords: role stress, work-family conflict, life satisfaction
INTRODUCTION Job stress arises as a result of the non-conformity between individuals and their work environment. Job stress is a stress arising from excessive workload and time pressures at the workplace. It also may arise from the interaction of individuals with work characterized by changes within the individual that drive it from normal function (Spector et al., 2000). Rahim (1996) states that stress associated with the role of a person in a job can have or have consequences on things that are not desired, both organizational and personal. Role conflict is a nonconformity in communicating expectations that impact on the performance of the role being played (Yousef, 2002). While, role ambiguity is the uncertainty about what action to take to complete a role (Peterson, 1996). Role overload itself, is defined as a number of demands that exist in a person's role (Schaubroeck, 1989). Job stress (role stress) experienced will result in conflict between work and family, because of the dual role as fishermen and as parents whose loads carried by those two types are heavy (Bedeian et al., 1988). Work-family conflicts occur when there is cumulative demands from roles at work and not work conflict with each other that makes it difficult to participate in other roles (Duxbury and Higgins, 2003). Roles in work include the role of superiors, subordinates, and colleagues, while the role in the family includes the role of husband and wife and parents. Work-family conflict can be felt by anyone, both men and men. In married couples who work and have children, the existing demands will feel more severe because they must balance between the demands of work and family demands. Gyllstrom (in Greenhaus and Beutell, 1985) found that a married person experiences a larger work-family conflict than an unmarried person. Because family activity plays a role in determining life satisfaction, so the work that affects family activity greatly will make the life satisfaction lower. Therefore, the work-family conflict
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will affect life satisfaction directly. Due to the big effects of stress on work-family conflict, and the effects of work-family conflict on the life satisfaction of fishermen, this study intends to examine these issues by raising the title, "The Role of Stress and Work-Family Roles Conflict on Life Satisfaction among Fishermen in East Java Province" with the problem studied here is to know how the role of stress and work-family roles conflicts have impact on life satisfaction among the fishermen. LITERATURE REVIEW Each job has its own cause or source of stress (Arnold et al., 1995). Role in the organization is one of the sources that potentially cause work stress (role stress). Robbins and Judge (2009) define the role of an expected pattern of peripheral patterns associated with a person who occupies a particular position within a social unit. Three important factors related to the role, which are considered as significant sources of stress are role ambiguity, role conflict and degree of responsibility for others (Arnold et al., 1995). Arnold et al. (1995) also revealed that when a person's role in the organization is clear and well understood, and when the expected expectations of a person are also clear and unconfirmed, stress can be kept to a minimum. Role stressors can produce stress on a person that are triggered by conflict, lack of clarity and too many roles a person has in an organization or social unit. Stress-related role (role stress) can have consequences for both the individual as well as for the organization as a whole. Job pressure such as role overload, role conflict and role ambiguity increase the stress that is negative (distress) experienced by someone (Schaubroeck, 1999). Senatra (1990) mentions that there are three potential consequences of role conflict and role ambiguity, namely job-related stress, job satisfaction, and the desire to leave the organization. Further, Senatra (1990) explains that the potential effects of conflict and ambiguity are costly, not only emotional consequences related to the individual, but also in organizational context, such as poor performance and high turnover which now, the role concept concerns on the negative effects of phenomena related to roles such as role conflict and ambiguity. Stress Management Stress is costly for both individuals and organizations as a whole so it must be managed well in the workplace to reduce the dysfunctional impact of the stress. The management needs to intervene in the effort to handle stress and have concern for the stress condition experienced by workers. Arnold et al. (1995) stated that when organizational-focused interventions aim to eliminate workplace or organizational stress sources, individual-focused interventions aim to help workers learn to cope with sources of stress, both from their work and from the organization. According to Robbins and Judge (2009), stress management can be done from two approaches, individual and organizational approach. The individual approach means that a worker can take personal responsibility to reduce his stress level through his strategies, such as time management, physical exercise enhancement, relaxation, and social network expansion. The organizational approach is done because several factors that cause stress (especially task demands and the role of organizational structure) are controlled by the management. Strategies that management can relate to stress management include improved selection of workers and job placements, realistic goal setting, redesign of work, increased employee engagement, improved organizational communication, and enforcement of corporate welfare programs. Work-Family Conflict According to Thomas and Ganster (1995), work-family conflict is a form of conflict between roles, in which the role of work and family pressure is contradictory. Duxbury and Higgins (2003) have similar definitions, but with added conflicts, where it is said that work-family conflict is a person's participation in a role that complicates participation in other roles. Another
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reference defined work-family conflict with work-life conflict, means that conflict occurs when work activities affect personal or family activities or vice versa (Reynolds, 2005) that comes from work-life conflict comes from the work environment and the family environment. Based on the statement, there are two types or direction of work-family conflict (Netemeyer et al., 1996), namely: 1. Work Interfering with Family (WIF), is a form of conflict between roles where the overall time and tension demands resulting from the work affect workers to fulfill family-related responsibilities. Grandey et al. (2005) show that for men, WIF is a unique and significant predictor of job satisfaction. This happens because the individual considers the role in the family as part of his identity (self-identity). 2. Family Interfering with Work (FIW), is a form of conflict between roles where the overall time and tension demands generated from the family affect workers to fulfill responsibilities related to work. Greenhaus and Beutell (1985) argue that work-family conflict has three major forms of role conflict: 1. Time-Based Conflict, as the results of time demands on one role affect involvement in other roles. These time demands can occur depending on the allocation of work time and family activities selected based on individual preferences and values. 2. Strain-Based Conflict. Stress generated from one role that influences other roles, thus affecting the overall quality of life. Stress perception of this role can arise from a person's predisposition in experiencing stress. In addition, individual abilities vary in the face of stress. 3. Behavior-Based Conflict, which is effective behavior for one role, but not effective for use for other roles. The ineffectiveness of this behavior can be caused by a lack of individual awareness of the consequences of his behavior to others. Ammons & Kelly (2008) found some work-family conflict antecedents, such as: 1. Time and work schedule 2. Marriage status, children and family 3. Level of education background 4. Negative punishment if the role demands are not fulfilled 5. Support from “significant other” 6. Personality. Work-family conflict experienced by workers influences not only the organization he is working at but also himself and his family. Work interfering with family can decrease the organization commitment and work satisfaction, increase stress level, and create intention to change jobs. along with work-family conflict, family interfering with work can increase the absence rate among the workers (Duxburry dan Higgins, 2003). Individually, work-family conflict can cause mood depression, psychological stress (burnout), decrease the life satisfaction and physical health (Duxburry dan Higgins, 2003). In families, parents who experience the pressure and tension related to job will influence their children indirectly because it can give impact to the caring pattern by parents (Clarke-Stewart dan Dunn, 2006). RESEARCH METHODS This research used qualitative descriptive research method as a research method based on postpositivism philosophy, used to examine the condition of natural objects, where researchers are as a key instrument, data collection techniques with triangulation and qualitative data analysis, more emphasis on meaning than generalization. The selected respondents are 83 fishermen.
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RESULTS AND DISCUSSION Respondents’ characteristics according to the last level of education shows that 69 people or 83% are senior high school graduates, respondents with final education level of junior high school as many as 14 people or 17%, and none of respondents with education level below junior high school. Respondents who have been working less than 2 years are 5 people or 6%, 2 years up to 3 years are 20 person or 24%, and more than 3 year until 8 years as many as 35 people or 42%, and the last characteristic is fishermen with working period of more than 8 years as many as 23 people or 28%. From the research that has been taken by conducting interviews and charging kuisoner then obtained the following results: 1. Stress Role Description To see the response to each role stress can be seen as follows: a. For statements about doing things that need to be solved differently are from 80 % of respondents and 20 % said they are still in difficulties and do not do things that need to be solved in different ways. b. For statements about accepting assignments without assistance to resolve them are agreed and done by 70 % of respondents while the rest, 30 % said they did not receive the assignment without assistance to solve it. c. About 70% of respondents agree for the working with two or more groups that apply different ways of work, while the other 30 % said that they do not work with two or more groups that employ a work different. d. For statements about accepting conflicting work requested by two or more people, 70 % of respondent are fine with that but the 30 % will not accept conflicting work requests from two or more people. e. For statements about doing something that the result can be accepted by one party but rejected by others 90 % are fine with that condition and 10 % are not comfortable to do that kind of tasks. f. About 85% of responents will accept the tasks without adequate resources and tools to run them, but the other 15 % will not receive tasks without the resources and tools to run them . g. About knowing that the fishermen have been reversed, 90 % and 10 % say it is still difficult, and the fisherman has indeed split the time well. h. For statements about knowing what is in charge (reversed), 70 % agrees and 30 % disagrees because fisherman knows what his responsibilities clearly but the difficulty is about weather that makes them decide to go home or continue work. 2. Work-Family Conflict Description To see the responses to each work-family about the work intervening of family and home life, the average response indicates a figure of 80 % of respondents, do not feel their work intervenes in family and household life except for them who are new to this kind of job. a. About 88% state that demands of the time the work brings difficulties for home care, family or personal responsibility. b. For statements about stress-induced work that bring difficulties to fulfilling the obligation of family activity, the average response indicates a figure of 83 %, which can be said that fishermen do not feel stressful work that later leads to difficulties fulfilling family and residual activity obligations due to family problems . c. For statements concerning liability to employment, fishermen want to change plans for family time, the average response is 68%, where it can be argued that fishermen do not want to change plans for family-related activities with respect to liability to work in the event of a change Deals with custom events in the family and the environment. d. For statements about job demands bring difficulties to relax with family at home, the
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average response indicates a 98 % figure where it can be said that fishermen have no difficulty relaxing with family at home because of job demands, this reaches the highest average due to climate change And weather factors in Indonesia. e. For statements about family demands interfering and disrupting work-related activities, the average responses show a figure of 90 %, which can be said that fishermen do not feel that family demands interfere with and interfere with work-related activities, this is understandable because of a single occupation Men sabagai fishermen. 3. Life Satisfaction Description a. For statements about in many respects, the present life has been considered not to be by 72% of respondents, because their strong desire is to have a stronger and weatherproof ships. b. For statements about the current pleasant living conditions, about 50 % of respondents said that the current living conditions are pleasant and sometimes unpleasant just because of natural factors. c. For statements about being satisfied with the current life, about 50 % of respondents said although they are satisfied enough with their current life, but they want the better one someday. d. About 60% of respondents are having the biggest desire in life in terms of being together with family and go back home from seas safe and healthy. e. A figure of 90% of the respondents said that long life does not change anything, but if it happens they want to be entrepreneurs in fisheries. To overcome the burden of stress role that is too high for the fisherman can do things as follows: a) Cooperative Agency that the relevant parties should get closer to the fishermen, such as providing counseling rooms, thus providing a stimulus for the fishermen who feel stress to come to consult and will create a sense of comfort for fishermen, as well as to build closeness of fishermen with the management of the Department of Cooperatives which party which is related. b) Working expectations to be achieved should be evaluated in order to always be realistic in accordance with the conditions that occur. Setting realistic and clear goals will greatly assist the fishermen in reducing the stress at work. While to overcome the conflict between work and family is higher then it can be done things as follows: a) Fishermen need to pay attention to the factors of work-family conflict and the trigger of the scope of work that can affect life satisfaction. For example by paying attention to the number of sailors in the workload that can burden and cause conflict in the family. b) The balance between work and life outside of work (work-life balance) is an important thing to be felt by everyone, because it concerns the life satisfaction of fishermen. For fishermen, this can be the basis for a strategy setting the time and the role individually and as a couple to avoid conflict between work and family. CONCLUSIONS The level of life satisfaction is strongly influenced by the psychological maturity of a person, so in general people who are older (based on respondents’ characteristics) have a higher level of life satisfaction than young ones, so the role of Role Stress and Work-Family Conflict on Life Satisfaction among fishermen in East Java Province can be applied. REFERENCES Ammons, S. K., and Kelly, E. L.(2008). Social Class and The Experience of Work-Family Conflict During The Transition to Adulthood. New Dimension Children Adolescent Development. Vol. 119. No. 71.
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Arnold, J., Cooper, W., and Robertson, P. (1995). Work Psychology Understanding Human Behavior in The Work Place. Second Edition. London. Pitman Publishing. Clarke-Stewart, A., and Dunn, L. (2006). Families Count: Effects on Child and Adolescent Development. New York: Cambridge University Press. Duxbury, L., and Higgins, C. (2003). Work-Life Conflict in Canada in The New Millenium: A Status Report. Journal of Applied Psychology. Vol. 132, No. 5. 321-339. Greenhaus, J.H., and Beutell, N.J. (1985). Sources of Conflict Between Work and Family Roles. The Academy of Management Review. Vol. 10. No.7. pp. 76-88. Netemeyer, R. G., McMurrian, R., and Boles, J. S. (1996). Development and Validation of Work-Family Conflict and Family-Work Conflict Scales. Journal of Applied Psychology. Vol. 81. No. 400. Peterson, M.F. (1996). Role Conflict, Ambiguity, and Overload: A 21-Nation Study. Academy of Management Journal. Vol. 38, No. 2. pp. 429-452. Rahim, A. (1996). Stress, Strain, and Their Moderators: An Empirical Comparison of Entreprenuers and Managers. Journal of Small Business Management. January. 46-58. Reynolds, J. (2005). In The Face of Conflict: Work-Life Conflict and Desired Work Hour Adjustments. Journal of Marriage and Family. Vol. 67. No. 1313. Robbins, S.P., and Judge, T.A. (2009). Organizational Behavior. 13th Edition. New Jersey: Prentice Hall. Inc. Schaubroeck, J. (1999). Antecedents and Consequences of Role Stress: A Covariance Structure Analysis. Journal of Organizational Behavior. Vol. 10. No. 1. pp. 35-48. Senatra, P. T. (1990). Role Conflict, Role Ambiguity, and Organizational Climate in a Public Accounting Firm. American Accounting Association. The Accounting Review. Vol. 55, No. 4. Spector, P.A., Chen, P.Y. and O’Connell, B.J. (2000). A Longitudinal Study of Relations Between Job Stressor and Job Strains While Controlling for Prior Negative Affectivity and Strains. Journal of Applied Psychology. Vol. 85, No. 2. 211-218.
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THE EFFECT OF PRODUCTS, SERVICES QUALITY AND PRICE ON CONSUMER'S PURCHASE INTENTION ON MELLOCREME CLOTHING PRODUCT OF ONLINE SHOP Mira Farina Kusuma Dewi, 2Tina Melinda♠
1
Ciputra University Surabaya INDONESIA Email:
[email protected],
[email protected] ABSTRACT The present research was aimed to examine the effect of product and service quality and price on consumer's purchase intention on Mellocreme clothing products online shop. The research approach used was quantitative. Sampling technique used was non probability sampling with purposive sampling method. The number of samples in this study were 50 respondents. Data collection methods in this study was using questionnaires measured by Likert scale and collected data were analyzed using multiple linear regression. Based on the results of the analysis that has been done, it was found that: (1) The quality of the product has a significant influence on consumer's purchase intention in Mellocreme clothing products online shop. (2) The quality of service has a significant influence on consumer's purchase intention in Mellocreme clothing products online shop. (3) Price has a significant effect to consumer's purchase intention in Mellocreme clothing products online shop. Keywords: Product Quality, Service Quality, Price, Purchase Intention INTRODUCTION The fashion industry in Indonesia is currently growing very rapidly. This condition is in line with the growing of the awareness of the fashion in the society that has led to the fulfillment of lifestyle in dressing, so it could be said that the need to dress today is not only to cover the body, but also as a means of communicating that can show lifestyle and identity to the wearer (Muslikhah, 2014). Since today’s development of fashion in Indonesia grows rapidly, the opportunities for the creative industries to produce fashion products is widely open. Various ways are done by the fashion industry to promote their products, such as selling in the boutiques or in social media. The way of promotion in social media is what can be said as the way of promotion which cheap, easy, and accessible to the public. However, people tend to have quite high mobility, so sometimes they do not have time to shop for clothes in clothing stores or malls. The alternative chosen by the community was by shopping for clothes online. This is supported by Pierce's statement in Verina saying that: “59 percent of Internet users said they purchase books or clothes online, followed by gifts (55 percent), travel (53 percent), electronics/appliances (47 percent), videos (46 percent), computers or peripherals (41 percent), software or games (40 percent), CDs (40 percent), and products for hobbies (38 percent), Which means that most consumers buy clothing products online "(Pierce, 2010, in Verina et al., 2014). Along with the development of fashion in Indonesia and the tendency of today's society to shop online, in November 2016 established an online shop for women's clothing, namely Mellocreme with casual and feminine concept that featured pastel colors with 20-35-year-old age segmentation. However, Mellocreme saw sales decline in January through April 2017. The
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decline in Mellocreme's sales was due to several possible factors. From the results of the initial survey that has been done, it was known that price and product and service quality has an important role in determining consumer's purchase intention when choosing Mellocreme products. Therefore, Mellocreme tried to explore these three factors as the weakness of Mellocreme that must be improved. LITERATURE REVIEW Previous Research Previous research used in this research was journal of Martono and Iriani (2014) with result which proves that variable of product quality, price, and promotion have significant influence to purchase intention of batik product of Sendang Duwur Lamongan. The second research used in this research was the journal of Sari (2016) with the result which proves that the brand image variable has no significant influence on consumer's purchase intention, but the variable of product quality and service quality have a significant influence. Future research is a journal belonging to Yogi (2016) which proves that the average consumer was considering the quality of the product when they intend to buy two-wheeled vehicles. The most recent research was a study by Hassan et al., (2014) which proves that service quality has a significant impact on purchase intention. Product Quality According to Mongi et al., (2013), states that product quality is the ability of a product to perform its functions that include durability, reliability, accuracy, ease of operation, and improvement and other attributes. When a product has been able to perform its functions, it can be regarded as a product that has a good quality. Service Quality According Arslan (2014), service quality is an assessment of the service in accordance with customer expectations. When a company or store provides good and has certain quality service, there is an increase in customer satisfaction to the company and consumer purchase intentions also increased. Price Kotler and Armstrong (2011) in Setiyaningrum et al., (2015: 128) defines price as the amount of money demanded for a product or service. More broadly it can be said that the price is the sum of all the value given by the consumer in order to gain a benefit on the ownership or use of a product or service. Purchase Intention Purchase Intention according to Martono and Iriani (2014) is the stage where consumers seek information to compare and think about the possibility that the product is able to meet his/her needs. Mellocreme Mellocreme is an online shop that move in the field of fashion, especially fashion for adult women. Mellocreme was established in November 2016 which was a joint venture with a friend, Nungki. The selection of business in the field of fashion was was based on interest in the field of fashion and opportunities that exist. Mellocreme carries the concept of casual and feminine that highlight pastel colors with segmentation age 20-35 years. RESEARCH METHODS The research approach was quantitative research. The population was followers of Mellocreme's Instagram of 151 followers. The sampling technique used in this research was non-probability sampling with purposive sampling method which became the technique of determining the sample with certain consideration (Sugiyono, 2014). The sampling criteria in this study were women with age 20-35 years and who ever asked about Mellocreme products through Line,
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Whatsapp, and Instagram. The number of samples used in this study were 50 respondents, the sample size was based on Roscoe's (1982) opinion in Sugiyono (2014: 90). Variables used in this research are: 1. Independent variable: • Product Quality (X1) • Service Quality (X2) • Price (X3) 2. Dependent variable: • Purchase Intention (Y) RESULTS AND DISCUSSION Tabel 1 Result of Validity Test Variable Item Correlation Coefficient Significant Explanation X1.1 0,685 0,000 Valid X1 X1.2 0,749 0,000 Valid X1.3 0,675 0,000 Valid X1.4 0,755 0,000 Valid X1.5 0,719 0,000 Valid X2 X2.3 0,923 0,000 Valid X2.4 0,922 0,000 Valid X3.1 0,763 0,000 Valid X3 X3.2 0,822 0,000 Valid X3.3 0,841 0,000 Valid X3.4 0,793 0,000 Valid Y1.1 0,654 0,000 Valid Y Y1.2 0,756 0,000 Valid Y1.3 0,818 0,000 Valid Y1.4 0,827 0,000 Valid Tabel 1 showed that instrument which used for each variable in this research was valid. Tabel 2 Result of Reliability Test Variable Cronbach’s Alpha Explanation Product Quality 0,761 Reliable (X1) Service Quality (X2) 0,825 Reliable Price (X3) 0,817 Reliable Purchase Interest 0,766 Reliable (Y) Tabel 2 showed that Cronbach’s Alpha was bigger than 0,6 so it can be said that the instrument used in this research was reliable. Tabel 3 Result of Multiple Linear Regression Analysis Variable Unstandardized Coefficient t Sig. Explanation B (Constant) 0,650 1,867 0,068 X1 0,240 2,607 0,012 Significant X2 0,190 2,278 0,027 Significant X3 0,385 4,040 0,000 Significant Table 3 shows that X1 variable which was product quality had a positive and significant influence on purchase intention, so it could be said that if product quality was improved then the higher consumer interest to buy Mellocreme. Variable X2 which was the quality of service had a
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positive and significant influence on purchase intention, so it could be said that if the quality of service was further improved then the higher consumer interest to buy Mellocreme. Variable X3 which was price had a positive and significant influence on purchase intention, so it could be said if the price was adjusted to the quality of product and service, the consumer interest in the product Mellocreme clothes would be increased too. Managerial Implications of Product Quality to Purchase Intention Before Research After Research 1. Not yet have a permanent tailor • Looking for tailors who have good sewing who has a sewing quality that in qualities accordance with Mellocreme • Compare the quality of the sewing with standardization. previous tailors, in order to work with Mellocreme. • If there is a tailor who can work with Mellocreme, then do not rule out if Mellocreme has a workshop for the production of the clothes itself. 2. Lack of quality control from • Mellocreme should do a re-checking of the internal parties of Mellocreme tidiness of sutures, such as whether or not there is a thread coming out of a seam or a tilted-looking suture. 3. Design or model clothes that • Mellocreme needs to make designs of still look less elegant and have a clothes with a model that is more elegant small number of model and unique. • Mellocreme should produce more fashion models, such as producing 5 - 7 shirt models in each collection to be launched every three or four months. Implication of Service Quality to Purchase Intention Before Research After Research 1. Mellocreme has not been • Mellocreme will respond to consumer responsive in serving consumer complaints and requests, which will issue complaints, such as complaints the latest products with different designs of about the model of clothes clothing in each collection every three or issued long enough from one four months. collection to the next collection. • Mellocreme will periodically record the products of the outfit, such as the designs of clothes, colors, and fabrics used. Implication of Price to Purchase Intention Before Research After Research 1. Consumers have not been • Mellocreme post a more close-up product convinced of Mellocreme image to make the material used more products because they have not visible and include additional captions on yet benefited from the product, photo captions on Instagram. as the material used on • Post testimonials from consumers who Mellocreme shirts is cold or have purchased Mellocreme products, so not. consumers are expected to be more
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•
convinced about the product because there is already a consumer experience buying Mellocreme outfits and can build more purchase intention. Provide endorse to a program that has good credibility. Consumers tend to be more confident to the online shop that once gave endorse to the program, because after getting the product, the program directly gives a review about the product.
CONCLUSION Based on the results and discussions, it could be concluded that: 1. Product quality (X1) has a significant influence on consumer purchase intention in Mellocreme's online clothing shop product. The increasing quality of Mellocreme products, such as fabrics used, sleek sewing, attractive colors, elegant looking products, and a variety of shirt models, has also increased consumer interest in Mellocreme shirts. 2. Quality of service (X2) has a significant influence on consumer purchase intention in Mellocreme online clothing shop products. The increasing quality of Mellocreme service, such as Mellocreme is responsive in serving the consumers and always giving the latest product info to the consumer, also increases consumer interest in Mellocreme shirt product. 3. Price (X3) has a significant influence on consumer purchase intention in Mellocreme's online clothing shop product. If the price is adjusted to the quality of the product and the quality of service, then the interest in consumer buying products Mellocreme clothes is increased. REFERENCES Arslan, M. (2014) ‘Impact of Brand Image and Service Quality on Consumer Purchase Intention: A Study of Retail Store in Pakistan’. Research on Humanities and Social Sciences, Vol. 4, No. 22. Hassan, H., Hashmi, M. S., & Sarwar Z. (2014) ‘Exploring the Impact of Retail Stores Service Quality on Consumers Purchase Intention: The Moderating Role of CSR’, MiddleEast Journal of Scientific Research 19 (4): 505-520. Martono, Moh., R. A. P. & Iriani, S. S. (2014) ‘Analisis Pengaruh Kualitas Produk, Harga, dan Promosi Terhadap Minat Beli Konsumen Produk Batik Sendang Duwur Lamongan’, Jurnal Ilmu Manajemen, Vol. 2, No. 2. Mongi, L., Mananeke, L. & Repi, A. (2013) ‘Kualitas Produk, Strategi Promosi dan Harga Pengaruhnya Terhadap Keputusan Pembelian Kartu Simpati Telkomsel di Kota Manado’, Jurnal EMBA, Vol. 1, No. 4. Muslikhah, R. S. (2014) ‘Pengembangan Industri Fesyen Sebagai Industri Kreatif Unggulan Untuk Mendorong Pembangunan Ekonomi Indonesia’. Available at http://rianamuslikhah.blogspot.co.id/2014/08/pengembangan-industri-fesyensebagai.html (Accessed: November 8th2016). Sari, R. D. A. (2016) Analisis Pengaruh Citra Merek, Kualitas Produk, dan Kualitas Layanan Terhadap Minat Beli Konsumen Pada Produk Smarthphone Samsung. Surakarta: Universitas Muhammadiyah Surakarta. Setiyaningrum, A., Udaya, J. & Efendi. (2015) Prinsip-Prinsip Pemasaran. Yogyakarta: Andi. Sugiyono. (2014) Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung: Alfabeta.
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Verina, E., Yulianto, E. & Latief, W. A. (2014) ‘Faktor-Faktor yang Mempengaruhi Keputusan Pembelian Pada Toko Fashion di Jejaring Sosial Facebook (Survei pada Konsumen Toko Fashion di Jejaring Sosial Facebook yang berlokasi di Indonesia)’, Jurnal Administrasi Bisnis (JAB), Vol. 10, No. 1. Yogi, K. S. (2016) ‘An Empirical and Fuzzy Logic Approach to Product Quality and Purchase Intention of Customers in Two Wheelers’, Pacific Science Review B: Humanities and Social Sciences xxx, pp. 1-13.
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FEASIBILITY STUDY VANNAMEI (Litopenaeus Vannamei) SHRIMP FARMING BUSINESS ESTABLISHMENT IN REMBANG Mohammad Habibul Ghoni, 2J.E.Sutanto♠
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Ciputra University Surabaya INDONESIA ABSTRACT The feasibility analysis of shrimp farming business establishment aims to analyze the feasibility of shrimp farming business establishment in Rembang in terms of aspects of industrial environment, market and marketing aspects, technical aspects, legal, human resources, and financial aspects. The unit of analysis used in this study are individuals (informants) as much as 6 informants. The feasibility study examined establishment of this business through six aspects, namely, the industrial environment aspects, market and marketing aspects, technical aspects, legal aspects, human resources, and financial aspect. Six aspects indicate that business establishment of vannamei shrimp farming in Rembang is acceptable and feasible for execution. To calculate the feasibility analysis of investment, used four methods of analysis, using the PP (Payback Period) which paid-back after 1 year and 4 months, PI (Profitability Index) value is 3,17, NPV (Net Present Value) in fifth year is Rp 646.792.562,- , and IRR (Internal Rate of Return) reach 42,89%. Overall results indicate that the business establishment of vannamei shrimp farming in Rembang is acceptable and feasible for execution. Keywords: Feasibility Study, Business Establishment, Family Business, Analysis
INTRODUCTION The sea is a liaison that has various functions related to several economic sectors. These include the economy of the farmers and their families, the fulfillment of the market for shrimp, the sustainability of cold storage, and the national income. Likewise with a variety of sea products that are currently popular as one of the main sources of nutrition besides chicken and beef. According to data from the Badan Pusat Statistik the level of consumption of fish and shrimp is higher than the level of chicken and beef consumption in almost last 10 years. Announced by Republika Online, "the last three years shrimp exports to the US are controlled by India, but in 2016 shrimp exports from Indonesia are number one in the US", said Nilanto Perbowo at the office of KKP Jakarta. This is certainly one of the proud achievements as a country with a more dominant maritime territory and with untapped potential. Furthermore, the government's target in the future is an increase in exports by 300% by 2019 (Ministry of Industry, 2015). Seeing optimism The government makes the authors think what can be done to realize the government target, because with the availability of vast land that stretches along the coast, it seems that the target is not impossible to be realized. Especially with the increasing number of new methods in cultivation, which allows farmers to obtain multiplication results with minimal land. Another important point is that Indonesia has a geographical area where
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Indonesia is an EMS-free country (Early Mortality Syndrome) that attacks other shrimp producing countries such as Thailand, China and India (KKP, 2015). Shrimp farming continues to dominate cultivation of crustaceans, with three main species Penaeus monodon, P.chinensis, and P.vannamei. Litopenaeus vannamei is a commercially cultivated shrimp species. The vannamei shrimp have a growth rate such as tiger shrimp that is 1 - 1.5 g / week but can be treated with high stocking density (60 - 150 / m2) and some even reach 400 / m2, can live in the salinity range from 0.5 to 45 ppt , Low protein requirement in feed 20-35%, and has a relatively higher survival rate of 85% compared to tiger shrimp which only has 60% (Briggs et al, 2004). The vannamei shrimp farming business in Indonesia is very promising because it is supported by large aquaculture fields. Broader agricultural land that is exploited will bring environmental changes, will lead to various diseases both infectious diseases and non-infectious diseases. Technical studies of shrimp farming need to be done so that shrimp farms can continue and reduce the negative impact on the surrounding environment and prevent the spread of disease (Sumardi et al, 2008). The vannamei shrimp farming is a capital-intensive venture so it is necessary to study the financial aspect to find out how feasible vannamei farming is in its current state. The author has some land in Rembang, Central Java that is potentially converted to shrimp farming location and wants to pursue shrimp farming business seriously. But on one occasion there must be a few things to ensure that all land conversion processes go well. Therefore, the authors feel the need to conduct feasibility studies more focused on technical aspects as well as financial aspects with the title Feasibility Study Vannamei (Litopenaeus Vannamei) Shrimp Farming Business Establishment In Rembang. LITERATURE REVIEW Business Feasibility Study Business feasibility study is a study that aims to decide whether a business idea is feasible to implement or not. Business ideas are eligible to apply if they can bring greater benefits to all stakeholders rather than their negative impact (Suliyanto, 2010). The business feasibility study according to Husnan and Muhammad (2009) is a study of whether the project is built within a certain time or not. Feasibility studies can be used as a clearer focus for businesses or business plans that have a logical sequence that allows to reach targets or avoid companies from uneconomic investments. This research requires cost, but the cost can be minimized with analysis of this feasibility study. The category of business feasibility study is divided into three categories (Subagyo, 2011), namely: new business establishment (creating a new business), business development (developing of business), and the purchase of business existing (business acquisition). The feasibility study category that will be conducted on this occasion is a business feasibility study in developing the business because the researcher has an existing business and has plans to be developed further. According to Suliyanto (2010) at the stage of forming a new business (creating new business), the aspects that need to be addressed are (1) Legal Aspects, (2) Environmental Industry Aspects, (3) Marketing and Market Aspects, (4), (5) Management and Human Resources, and (6) Financial Analysis. In the business development phase, the aspects analysis that will be discussed in business feasibility study is (1) Environmental Industry Aspect, (2) Marketing and Market Aspects, (3) Technical and Technological Aspects, (4) Management and Human Resources Aspects, (5) Financial Analysis. The legal aspect is still used in business development studies in this research because development is done elsewhere and requiring some new permits. Market and Marketing Aspects Market is a group of buyers and sellers of goods or services. As a group, the buyer determines how much demand the goods and as a group of others, the seller determines how much the supply of goods (Mankiw, 2009).
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Analysis of market and marketing aspects plays a very important role in the development of business because the main source of income comes from the sale of products produced. The analysis of the market aspect analyzes the number of products that competitors offer. While the analysis of marketing aspects to analyze the way or product strategy produced can be up to the consumer with more efficient than competitors (Suliyanto, 2010). The marketing strategy of conventional goods, shopping goods and special goods varies. If the product is manufactured in the form of conventional goods then the distribution strategy for manufactured goods is available wherever it is very important. Whereas if the product is a special item then the promotion strategy to ensure goods to be sold very special becomes very important. As well as industrial goods consumption goods can also be divided into several classes (Suliyanto, 2010): (1) Raw materials, (2) Semi-finished materials, (3) Inventory operations. Marketing strategy that supports the achievement of marketing in accordance with the wishes, namely (Purwana, 2016): Strategy (1) Segmenting (market segmentation), (2) Targeting (market setting), (3) Positioning (market positioning), or it is known by STP Strategy. Environmental Aspects and Industrial Structure Every business must have consideration on the environmental aspects of the industry. This is because the environmental factors of many or few industries have a considerable influence on the smoothness of business / business. The analysis done in the environmental aspects of the industry is PEST analysis (political, economical, social and cultural, and technological) and the five power analysts (Suliyanto, 2010). According to Porter in (Suliyanto, 2010) divides the five forces that determine the level of competition in an industry, namely: (a) entry of newcomers, (b) threat of substitution products, (c) bargaining power of buyers, (d) Bid on suppliers, (e) Competition among existing competitors. To formulate a marketing strategy, is supported by SWOT analysis (Strength, Weakness, Opportunity, Threat) that is comparing internal company environment condition (strength and weakness) with external company environment condition (opportunity and threat) (Kodrat, 2009) . Financial aspect Financial aspect is a very important aspect in preparing or running a business. In preparing a business, the financial aspect becomes the main reference to the business either to be created or that has been made to assess whether the business is feasible to run or not. A profit-oriented business will decide to run a business idea if the business is financially profitable, while a nonprofitiented business requires a financial feasibility study to answer the question of whether the business idea will continue to run in an effort to carry out its social mission with revenue Which he received (Suliyanto, 2010). The financial aspect includes information and data from all other aspects to be incorporated in the financial statements. The financial statements will be analyzed by means of investment valuation criteria, namely: Net Present Value, Internal Rate of Return, Payback Period, and Profitability Index (Muslich, 2009). Technical Aspects Frequent business / business failure is unable to face technical problems. Therefore, technical aspect analysis is used to answer the question of whether the business is technically feasible or not (Suliyanto, 2010). Things that need to be analyzed in technical aspect in this research are: (1) selection of business development location, (2) determination of business place layout, (3) selection of machine and equipment (4) Determination of optimal production scale Aspects of Management and Human Resources Human resource aspect is an important aspect and needs to be analyzed as well as development materials from a business / business. The role of human resources is no longer as a technical exercise, but as a partner in the company to be actively involved in the effort to realize
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competitive advantage (Kodrat, 2009). Discussion in the aspect of human resources includes: organizational structure, procurement of labor, and compensation and benefits. RESEARCH METHODS This research is an applied research, that is research which concerns the application of a theory to solve a certain problem (Kuncoro, 2009). Applied research is conducted with the aim of applying, testing and evaluating the ability of a theory applied in solving practical problems (Neolaka, 2014). The place of study is determined based on the location of the shrimp farming business that is Rembang district and begins in September - December 2016. The sampling method uses Saturation Sampling because the population is small. Where Saturation Sampling method is sampling method by including all member of population as sample (respondent) research. This method aims to obtain data effectively and accurately in accordance with the needs required by researchers, so the data obtained is really accurate. Interview conducted to technician from PT. CP Rembang as a cultivation construction advisor, some local village apparatuses, other shrimp entrepreneurs in areas adjacent to target locations, feed suppliers as well as shrimp seeds, then middlemen that accommodate the crops. The unit of analysis used in this study is the individual (informant). Individual analysis units are selected to explore individual knowledge and opinions as supporting data in the analysis. Informants used are parties directly related to the establishment of shrimp farming business in Rembang that are technicians from PT. CP Rembang as a cultivation construction advisor, some local village apparatus, other shrimp entrepreneurs in the area adjacent to the target location, feed suppliers and also shrimp seeds, the big middleman that accommodates the crops. Data collection methods in this study using data promer and secondary. Primary data is data obtained by self through interview, observation and questionnaire (survey). Secondary data is data obtained from second source through document / literature study. Data analysis from this research is done by analyzing every aspect that is studied, that is environmental aspect and industrial structure, market and marketing aspect, legal aspect, technical aspect, human resource aspect, and financial aspect. The data can be declared valid if there is no difference between the reported by the researcher with what actually happened to the object under study. According to Yin (2009), there are four kinds of testing to validate data through construct validity, internal validity, external validity, and reliability. RESULTS AND DISCUSSION Environmental Aspects and Industrial Structure PEST (Politic, Economy, Social, Technology) 1. Politic Political factors are quite influential on the shrimp farming business, because so far the role of government is good and focus to improve fishery performance, especially the main export commodities of Indonesian fishery which is shrimp. In 2016, Indonesia ranks first to export shrimp products to the United States. This is certainly not separated from the efforts of the Ministry of Maritime Affairs and Fisheries that continue to encourage the fishery sector improved so that performance increases every year. As for several priority program plans from the KKP (Ministry of Marine Affairs and Fisheries) for 2017, there is a pro policy on the shrimp farming sector, such as the procurement of 1000 windmills, the construction of 20 cold storages, optimization of fish factory sellers and the provision of some fisheries supporting tools such as “keramba” and others. The target of the cultivation sector in 2017 also increased from 19 million tons to 22 million tons or increased 3 million tons from the previous year.
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Target and optimism of the government would be advantageous for shrimp farming which national shrimp industry become one of Indonesia's superior export products that can compete in the international market and its proof that the potential of the fishery sector, especially shrimp is still very big. 2. Economy Indonesia's economic growth in 2016 has increased compared to growth in 2015 ranging from 4.7% to 5%. In accordance with the Decision of Central Java Governor concerning Minimum Wage of Rembang from year 2016 equal to Rp 1,300,000,- become Rp 1,408,000,- in year 2017 or increase about 8%. But this has little impact on business because this type of cultivation is not labor-intensive but capital-intensive, the operators required in the cultivation process amounted to three people, so the increase in Minimum Wage has not been assessed to have significant impacts. . In 2016, shrimp production in other countries declined and this is predicted to occur in 2017, so for Indonesia it is an advantage that domestic shrimp sales will be better in the global market, and this is why by 2016 Indonesia led the Market Shrimp in the United States because India was in trouble. 3. Social Shrimp is a favorite food in the world as well as in Indonesia. Indonesians like to consume shrimp or processed products. As shrimp paste is an original Indonesian product that is actually made from a type of rebon shrimp, it can be found in most cuisines in Indonesia. Likewise with petis that can be found especially in East Java who likes to process petis into typical foods such as rujak cingur, tahu tek, tahu campur, lontong kupang and many other dishes that use petis. This proves that the taste of shrimp is very popular and in accordance with the culture in Indonesia. Shrimp is also protein-rich type of food that are very good for children during growth. Of course if the child's growth is good, then the child will become more active and tend to excel. In addition, awareness of the quality of our food is improving now, so food suppliers should also be more careful to provide quality materials and conform to good standards. In shrimp culture industry, it is mandatory for the farmers to avoid the use of antibiotics, because antibiotics can leave a bad residue if consumed in the long run. 4. Technology Technological growth today are very rapid, there are already many new technologies found to facilitate people in the activity, as well as in the shrimp industry. Shrimp cultivation that initially only uses traditional systems, along with technological developments started semi intensive cultivation system, intensive, and even recently there is a cultivation using superintensive system. In addition to improve cultivation process, the latest cultivation system also applies environmentally friendly concepts by providing cultivation waste management. In addition, this new technology also makes land productivity better. For example, the land used for cultivation farms is generally 0.5 Ha per pond, but now more directed to a narrow land like 0.1 ha but capable of producing shrimp with larger tonnage. One technology that will be used in this cultivation is the use of geomembrane for aquaculture ponds, because it provides more water stability than soil ponds, more efficient investment when compared to concrete ponds, and also its long economic life is about three years when compared with a plastic sheet just two years. Aquaculture cultivation is also an aspect that is currently being developed by researchers because contamination of the environment today has become something that should be minimized because it can have a wide impact for farmers and surrounding communities. One of the simplest wastewater treatment technologies available is storing wastewater to precipitate all the dirt and hazardous residues, then in biofilter-filled shelters such as shells, water hyacinths, or inserts.
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Five Forces Analysis The description of the five forces in the business can be seen in Figure 1 below.
Figure 1. Five Forces Analysis In Figure 1 above describes the conditions of the five forces in the industry. The buyer is one aspect in the industry that is very important because the company will get the proceeds from the buyer. With the highest value among other indicators, it indicates that buyers can easily find alternatives to other crops if the shrimp that has ever been purchased is unsatisfactory or unfavorable. So one of our business strategy is to accelerate the harvest process that can impact on the results of shrimp are more fresh, clear, and also clean. So that will make the buyer satisfied and will always looking for us when the harvest time is coming. Among the five indicators above, which has the lowest value is the level of competition between competitors. Shrimp is a commodity of the world, which the level of competition is at the inter-state level. Therefore, what is happening in the field is togetherness fellow shrimp farmers, to increase productivity for shrimp production so Government target can be achieved. With such low levels of competition, shrimp business players will be able to focus more on quality improvement, rather than having to think about how to find a market to sell their crops. It is also that makes research on shrimp farming technology in this country continues to grow. In fact, Indonesia is currently the record holder of the largest tonnage per 1000m2 that is 15 tons of shrimp using super-intensive cultivation system. That is a remarkable achievement needs to be proud of for the national shrimp industry. The summary of the five forces above shows that the threat of competition among shrimp farmers is low. TThe bargaining power of buyers and suppliers is in the medium category, so it will not have a significant effect on this business, then the threat of substitution is also considered low, because the shrimp has a clear position in the minds of consumers and difficult to be replaced by other products. The threat of newcomers is in the medium category, where newcomers will not be too difficult to plunge in this industry, because the support from the government is good enough that would make it easier for prospective newcomers in accessing capital, the science of cultivation techniques, as well as information availability of land which are eligible. Nevertheless, the presence of newcomers do not harm this cultivation business, as long as communication can be well established so that there is a preventive action if one of the neighbors infected by a disease, and not harm other cultivators. SWOT analysis Next is to project the SWOT analysis to find out the internal and external conditions of this business after establishment. Identification of S (Strength), W (Weakness), O (Opportunity), and T (Threat) are as follows:
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1. Strengths: a. Cultivation technology is modern b. Harvest is faster and more efficient c. More quality crops 2. Weaknesses: a. No product differentiation b. Ponds are limited c. Sales are still through intermediaries 3. Opportunities: a. Local and export markets are still big. b. Technology that continues to grow, facilitate the cultivators c. Shrimp as a processed product have high demand 4. Threats: a. The rise of other country's shrimp productivity b. Price fluctuations of shrimp c. High investment for new technology use, can slow down business growth Market and Marketing Aspects STP (Segmenting, Targetting, Positioning) Segmenting Our shrimp buyers are buyers from Rembang, Tuban and Lamongan area. Buyers from that region mostly big buyers which have export market and have a big cash capability, thereby reducing the risk of default, although the case is very rare in the shrimp industry. That regions are also the closest region of the cultivation location, so it will be easy to reach the location when harvest time is coming. However, because we also harvest the small shrimp, sometimes the price at individual buyer will be better and in terms of harvest costs will be less because the buyer only takes the quantity of about 30-50 kg which no need to pay for extra worker, because it can be done by the operator itself by capturing using net. Here is the market segmentation that will be displayed in Table 1. Table 1. Segmentation of Rembang Shrimp Farming Shrimp Size Above 150 pcs/kg Below 149 ekor/kg Buyer Individual
1
4
Restaurant
2
5
Cold Storage Company
3
6
Source: Processed Data (2017) Targeting For targeting, we will focus on the number 1, 6 that is in Table 1, for the shrimp with 150 pcs / kg will be sold to individual, because in general the quantity of that size is not too big that is about 3 - 5 Kwintal, so cold storage companies will usually provide a lower price considering transportation costs will be as great as if taking 4 tons, although sometimes if there is a shrimp rarity then cold storage will dare to put a high price to get the shrimp with such small size. As for the harvest with size below 149 pcs / kg will be sold to cold storage that most will be exported. With a price of around Rp 57,000 / kg for that size, selling to cold storage will be
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more profitable because large quantity can be sold immediately in one harvest, it does not happen if the buyer is an individual. Positioning The positioning of this cultivation business compared to traditional ponds in the Sarang area is "Quick harvest, clean shrimp and not pale". Positioning is based on our real superiority compared to traditional cultivators in the area. So that, we will be more easily remembered by the buyer. Technical Aspects Business Location Our cultivation business is located in Sarang District of Rembang Regency. This location is chosen considering that the location is a land of our own, which will minimize some risks and make it easier for us to manage and utilize.. The location is also strategic in terms of feed and seed supply, since the warehouse of the feed and also hatchery used in the process of shrimp cultivation is located in the center of Rembang Regency. Likewise with easy access road because access is available for trucks that can go directly to the location of cultivation. Business Layout Design of the layout becomes quite important because it will consume big costs in the making, The ease of cultivation process will also determined by a well planned layout. For cultivating process, we will use geomembrane in accordance with the benefits of cost and durability
Figure 2. Kedai Ketan N Layout Aspects of Management and Human Resources At the beginning of this business the organizational structure used is a simple organizational structure, the top owner is only assisted by three operators to help for cultivation operations. While all other purposes such as financial problems will be handled by the owner themselves. Organizational structure like this has advantages that all activities can be monitored and also can be followed up immediately if there are things unappropriate. However, this organizational structure also has a deficiency in which the owner becomes the main focus of decision making, if the owner does not present, the other work beside cultivation process will be chaotic. The salary given has been able to reach the Regional Minimum Wage of Rembang Regency which is Rp 1.408.000,Financial aspect The financial aspect is the last aspect used to assess the business development worth doing or not. Financial aspect analysis is divided into three categories, namely normal conditions,
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optimistic conditions and pessimistic conditions. Normal conditions are the most likely conditions to occur. Optimistic conditions are the best conditions that can be achieved, while pessimistic conditions are the worst conditions that may befall the company.
Provision PP PI NPV
Table 2. Feasibility of Financial Aspects Normal Provision PessimisticCondition Condition PP < 4 Years 1 Year 4 Months 1 Year 3 Months PI > 1 3,17 NPV 5 Years > Rp 646.792.562 Rp 0
IRR
42,89% In pessimistic conditions the four provisions of eligibility are met
3,88 Rp 901.689.099
50,91% In normal condition the four provisions eligibility are met
Optimistic Condition 1 Year 3 Months 5,06 Rp 1.320.921.349 61,85% In optimistic condition the four provisions eligibility are met
Source: Processed Data, 2017 CONCLUSSION Environmental Aspects and Industrial Structure Based on the results of industrial environmental analysis can be seen that the political situation in Indonesia is enough to support the national shrimp industry, Indonesia's economic conditions will also be projected to increase from year to year, while from the social point of view that the high demand of shrimp consumption in Indonesia indicates that shrimp has become a favourite product and already integrates with the culture in Indonesia, while the effect of technology on shrimp farming itself has a good impact, the more technological advance makes it easier for farmers to get satisfactory results. Based on PEST analysis, it can be seen that PEST factors are quite easy for the establishment of shrimp vannamei business in Rembang. Based on the results of Five Forces Analysis, it can be seen that from the five strengths in the industry, the three biggest strengths are bargaining power of buyers, bargaining power of suppliers, and the threat of newcomers, while the threat of substitution products is not very influential and the competition between the existing competitors are very low. Market and Marketing Aspects Currently the level of shrimp consumption both locally and globally continues to increase, as well as increased production each year. This indicates that the market for shrimp is still not experiencing a saturation point even in the prediction will still continue to increase considering the shrimp is in great demand because it is a delicious and nutritious food. Research on the establishment of shrimp farming business in Rembang uses STP analysis, it is generated that this business will target individual buyers and buyers of large parties such as cold storage companies. That two target markets are chosen to meet the needs of local markets and export shrimp markets. The positioning of this business is "Quick harvest, clean shrimp, not pale", the tagline is chosen because of the strength of this cultivation, when many shrimp suppliers from various cultivators, the tagline will be able to make the buyers remember our shrimp and will always wait for the next harvest from this farm. Technical Aspects Shrimp farming can not be separated from the technical aspects which for intensive cultivation system it is absolutely mandatory. The selected location is a safe location in terms of illness,
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and also safe from the social aspect. Likewise, easy road access will facilitate all the needs both when preparation, cultivation process, and harvesting. Geomembrane technology will be able to help produce clean and bright shrimp, with a fast harvesting. Climate at the cultivation site is also quite stable where the average temperature is 23 ° C which is the optimal temperature of shrimp culture and maximum temperature of 33 ° C. Rainfall is also considered moderate with 4 to 5 wet months so it will facilitate when doing the distribution of seeds on time, because the drying process can be done optimally. Aspects of Management and HR (Human Resources) A simple organizational structure has been established which is accompanied by the terms and expertise of the operators. The salary given to 3 operators is in accordance with the Minimum Wage of Rembang Regency and there are also bonus to be provided in accordance with the performance of each operator to be assessed from the respective managed ponds. In addition, intensive mentoring will also be done by experienced technicians. Financial aspect The projected financial statements projected income statement and cash flow statement from 2017-2021. The method used is PP (Payback Period), PI (Profitability Index), NPV (Net Present Value) and IRR (Internal Rate of Return). All of these investment assessment criteria show positive results in both pessimistic, normal and optimistic conditions. Based on the results of feasibility analysis that has been made, it can be seen that the business feasibility criteria of the financial aspects have been met.. REFFERENCES Adiwijaya, D., I. Sumantri dan Supito. (2008). Penerapan teknologi Budidaya Udang Vannamei Semi Intensif pada Lokasi Tambak Salinitas Tinggi. Media Budidaya Air Payau Perekayasaan. Lombok. Avnimelech, Yoram dan Ritvo, Gad. (2002). Shrimp and Fish Pond Soils: Processes and Management. Elsevier. Briggs, Mathew, dkk. (2004). Introduction and Movement of Penaeus vannamei and Penaeus stylirostris in Asia and The Pacific. Bangkok : FAO. Callinan, Richard, dkk. (2006). Australian Prawn Farming Manual. Brisbane : Department of Primary Industries and Fisheries. Dewi, Santi. (2010). Studi Kelayakan Pembangunan International Student Housing UI. Jakarta: Universitas Indonesia. Herlianto, D. & Triani P. (2009). Studi Kelayakan Bisnis. Yogyakarta: Graha Ilmu. Husnan, S. dan Muhammad. (2009). Studi Kelayakan. Yogyakarta: Graha Ilmu. Ireland, R.Duane, Hoskisson, Robert E., Hitt, Michael A. (2013). The Management of Strategy Concepts and Cases, 10th edition. Canada: Nelson Education, Ltd. Kartajaya, Hermawan. (2010). Grow with Character. Jakarta: PT Gramedia Pustaka Utama. Kasmir. (2006). Kewirausahaan. Jakarta : PT RajaGrafindo Persada. Kasmir dan Jakfar. (2007). Studi Kelayakan Bisnis. Jakarta: Penerbit Kencana Prenada Media Group. Kemenperin. (2015). Target Ekspor Realistis. kemenperin.go.id. Diakses tanggal 24 Oktober 2016. KKP. (2015). KKP Nyatakan Udang Indonesia Bebas EMS. Diakses tanggal 24 Oktober 2016. Kodrat, David Sukardi. (2009). Manajemen Strategi: Membangun Keunggulan Bersaing Era Global di Indonesia Berbasis Kewirausahaan.Yogyakarta: Graha Ilmu. Kodrat, David Sukardi.(2010). Manajemen Eksekusi Bisnis. Yogyakarta:Graha Ilmu. Kuncoro, M. (2009). Metode Riset untuk Bisnis dan Ekonomi. Edisi Ketiga. Jakarta: Erlangga. Kunvankij, P dan Chua, T. E. (1986). Shrimp Culture: Pond Design, Operation and Management. FAO Corporate Documen Respository.
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Latt, U Win. (2002). Shrimp Pond Waste Management. s.l. : Aquaculture Consultant Mananda, I Gusti. (2011). Studi Kelayakan Pendirian PT Medussa Multi Business Center (MMBC) Sumanda Tour & Travel Di Bali (Kajian Aspek Pasar dan Finansial). Bali: Universitas Udayana. Mankiw, Gregory N. (2009). Principles of Economics: Pengantar Ekonomi Mikro. Edisi 3.Jakarta: Penerbit Salemba Empat. Marindro, I. 2008. Waspada terhadap Musim Hujan. marindro-ina.blogspot.com. Diakses tanggal 23 Januari 2017. Mulyatiningsing, Endang. Metode Pengumpulan Data. staff.uny.ac.id. Diakses tanggal 23 Oktober 2016. Muralidhar, M., M. Kumaran, B. Muniyandi, N. W. Abery, N. R. Umesh, S. De Silva, dan S. Jumnongsong. (2010). Perception of Climate Change Impacts and Adaptation of Shrimp Farming in India: Farmer Focus Group Discussion and Stakeholder Workshop Report (2nd Edition). Network of Aquaculture Centers in Asia-Pasific. India. Muslich, Mohammad. (2009). Manajemen Risiko Operasional : Teori dan Praktik. Jakarta: Bumi Aksara. Neolaka, Amos. (2014). Metode Penelitian dan Statistik. Bandung : PT. Remaja Rosdakarya. Ohangbon, Charles. (2012). Feasibility Study of African Restaurant in Helsinki. Helsinki: University of Applied Sciences. Pongsiri. (2013). Market Feasibility for New Brand Coffe House : The Case Study of Thailand. Thailand: International Journal of Social, Behavioral, Educational, Economic, Business and Industrial Engineering Vol:7, No:8. Pribadi, Januar, Kurniawan dan Mawardi, M Ilyas. 2003. Standard Operasional dan Prosedur (SOP) Udang Putih (Litopenaeus vannamei). Lampung : PT. Central Pertiwi Bahari, 2003. Purwana, Dedi. (2016). Studi Kelayakan Bisnis. Depok : PT. Rajagrafindo Persada. Ramlah, Siti. (2007). Studi Kelayakan Pendirian Usaha Pengolahan Lemak dan Bubuk Kakao di Kabupaten Luwu Utara. Makassar: Universitas Hasanuddin. Rangkuti, F. (2011). Analisis SWOT: Teknik Membedah Kasus Bisnis. Jakarta: PT Gramedia Pustaka Utama ; Jakarta Rivai, Veithzal. (2009). Manajemen Sumber Daya Manusia untuk Perusahaan. Edisi Kedua.Jakarta: Raja Grafindo Persada. Sathirathai, Suthawan dan Barbier, Edward B. (2001). Valuing Mangrove Conservation in Southern Thailand. Contemporary Economic Policy Vol. 19, No. 2. April 2, 2001 Subagyo, Ahmad. (2011). Modul Studi Kelayakan Bisnis. Jakarta: PT Elex Media Komputindo. Suliyanto. (2010). Studi Kelayakan Bisnis: Pendekatan Praktis. Yogyakarta: Penerbit Andi. Sumardi, dkk. (2008). Pengaruh Perubahan Suhu Terhadap Virulensi White Spot Syndrom Virus (WSSV) Pada Udang Putih. Lampung : Universitas Lampung. Sutanto. (2009). Perubahan Cuaca Ekstrem, Penyakit Udang Merebak. koralonline.com/artikel/12. Diakses tanggal 23 Januari 2017. Tengtarto, Jaya Adi Gama. (2014). Studi Kelayakan Pengembangan Bisnis PT. J. Surabaya: Universitas Ciputra. Umar, Husein. (2005). Studi Kelayakan Bisnis: Teknik Menganalisis Kelayakan Bisnis Secara Komprehensif. Jakarta: Gramedia. Viroonkul, Poonsub, dkk. (2009). Good Aquaculture Practices for Marine Shrimp Farm. Bangkok : National Bureau of Agricultural Commodity and Food Standards. Wyk, Peter Van. (1999). Economic of Shrimp Culture in Recirculating Aquaculture System. [book auth.] Peter Van Wyk, et al. Farming Marine Shrimp in Recirculating Freshwater System. Florida : Harbor Branch Oceanic Institution.
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Yin, R. K. (2009). Case Study Research Design and Methodhs, 4th edition. California: Sage Publication. Yudisti, Willyarta. (2012). Kajian Teknis dan Finansial Usaha Pembesaran Udang Vaname (Litopenaeus Vannamei) di PT. Suri Tani Pemuka. Jakarta: Sekolah Tinggi Perikanan.
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OPTIMAZING ACCOUNTING INFORMATION SYSTEM BY USING SIX SIGMA DMAIC METHOD TO GET FINANCIAL BENEFIT (CASE STUDY PT. PHILIPS INDONESIA - SURABAYA) 1
Nanik Kustiningsih
STIE Mahardhika Surabaya INDONESIA Email :
[email protected] ABSTRAK This research aims to optimazing accounting information systems in order to get soft saving on a manufacturing business in the field of payment information system that occur in the Surabaya region, especially at PT. PHILIPS INDONESIA which is now using the information system which is very nice but it is not used optimally, in practice there are still many transactions still use the data manually, the numbers of documents used resulted in the process did not run effectively and efficiently. this research aims to analyze the computerized information system for the payment of the invoice that still uses a manual transaction. This research used six sigma DMAIC Methods. DMAIC is a cycle of improvement based on performance data, which not only can be applied to the improvement of the quality but can be applied also in cost savings and can be used to enhance, optimize and stabilize the design and business processes of the company, from this study are expected this information system is used to its full potential get cost of avoidance saving as well as their better control on the payment cycle and the procedures to be standardized and of the financial will avoid the losses that are not supposed to happen (cost of avoidance), as well as cost savings. Key words : Accounting Information System, Six sigma, soft saving INTRODUCTION Nowadays business players in Indonesia are increasingly aware of the changing business patterns of information systems that exist along with the rapid progress of information technology. In the increasingly fierce industrial world competition, companies must be able to survive and compete with similar companies. Therefore, companies will be better if adopting a system that has been proven to have benefits for the companySix sigma is a method of improving quality and process by using structured tools and statistical measurement. At first this method was applied by Motorolla in 1985 and managed to bring huge profits for the company. The success of Motorolla applying six sigmase to bring great profits to make six sigmaterus developed in recent years. General Electric, Boeing, Ford, Toyota, Bank of America and Allied Signals are examples of companies that follow Motorolla's trail to implement six sigma.PT. Philips Indonesia, a multinational electronics company that has a vision to become a global player in the leading lighting business (lighting), including Indonesia. As a market leader, the company is also always innovate with the vision to be the best in class (best in their class/level on lighting business)PT. Philips Indonesia with a wide range of operational activities have had already a system and is very good that is ERP-SAP but in operational practice the activities or transactions are still done manually performed by suppliers who do not use PO
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(Purchase order) are:Supplier related to the distribution or import-export activities (shipping liner, forwarders, shipping)2. The bill payment from the government (PLN, PDAM, Telkom, etc.)3. Other - Other (Hotels, etc.)4. Unexpected (hospitals, pharmacies, laboratories, etc.) The project background of this research was triggered by :1. The number of manual transactions2. The existence of double invoicing / billing from suppliers3. The existence of cost of avoidance savng4. delay / long process of document to the finance section5. The high cost of the 3rd party (outsourcing) Researchers focused research on number of suppliers who use manual transaction, in this study the authors limited to point no. 1 supplier related to distribution activities or suppier related to exports and imports (shipping liner, forwarders, shipping) which is under global agreement) Although it has become a market leader, with the distribution to 225 destination countries and 1656 transactions and has 27 vendors, but in the process of transactions there is still a process done manually where it potentially leads to inefficient processes in terms of costs incurred or mistakes in transactions Resulting in a loss to the company. The purpose of this research is to examine the application of Six Sigma method to minimize invoices without PO or improve manual payment payment process by using PO flow and its suitability. LITERATURE REVIEW 2.1 Accounting Information System Accounting Information System is a functional information system underlying other functional information systems such as financial information systems, marketing information systems, production information systems and human resource information systems. Other information systems require financial data from accounting information systems. This can indicate that if a company that will build a management information system, it is advisable to build an accounting information system first. Important functions formed by SIA in an organization include: Collecting and storing data about activities and transactions. Processing data becomes into information that can be used in decision making process. Precise control of the assets of the organization 2.2 Six Sigma Six sigma is a method or technique of dramatic quality control and enhancement applied by the Motorola company since 1986, which is a new breakthrough in the field of quality management. The principle of Motorola's six sigma control and enhancement quality is able to respond to the challenges commonly faced in the industry, and Motorola proved for 10 years after the implementation of the six sigma concept has been able to achieve 3.4 DPMO quality level (Defect per Million Opportunities - Failure per million opportunities) (Gasper, 2002) 2.3 Six Sigma Improvement Model In Six Sigma there is a 5 phase cycle of DMAIC (Define, Measure, Analyze, Improve, Control) which is a continuous improvement process towards the target of six sigma. DMAIC is systematically based on knowledge and facts. DMAIC is a closed-loop process that eliminates unproductive process steps, often focusing on measuring new measurements and applying technology for quality improvement toward a six sigma target. Some level of sigma attainment:
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Tabel 1. Tabel konversiSix sigma sederhana. Sigma
Yield
DPMO 691.462
1-Sigma
31,0%
( Sangattidakkompetitif ) 308.538 ( rata
2-Sigma
69,2% rataindustriIndonesia )
3-Sigma
93,3%
4-Sigma
99,4%
66.807 6.210 ( rata rataindustriUSA )
5-Sigma
99,97%
230
99,99966
3,4
%
( industrikelasdunia )
6-Sigma
Source : Vincent Gasperz (2002) RESEARCH METHODS The type of research used by the authors is descriptive qualitative research and tend to use analysis and further highlight the process and meaning where the DMAIC method used as the basis in this study. The operational steps of DMAIC are as follows:Stage Define (D), this stage is the stage where this is the first step in starting a six sigma project. In this stage it is necessary to define some matters relating to the criteria of selecting a research object and identifying the problem as a Project back groundPhase Measure (M), this stage is the second operational step in Six Sigma project which includes Measurement and Set-up target where the tools used are Primary Metric and Secondary Metric and Pareto diagramAnalyze Stage, this stage is the third stage in the DMAIC cycle. At this stage in doing data analysis and identify the cause of the problem by brainstorming with the company where the tools used are 5 WhyImprove Stage, Once the root of the problem is known, then the next step is to perform corrective action planning to overcome or prevent the occurrence of problems that become the focus of Six Sigma project. In brief the focus of this Improve phase is the Implementation PO Flow and Improvement actionStage Control, This stage is the last operational stage in Six Sigma project. At this stage will be made a system control mechanism to control every transaction process so that inefficient activities can be minimized, while this phase includes the standardization of the efficiency and culture of the organization. The roadmap of Six Sigma project which is used as the basis in this research is as follows:
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DEFINE Progress : Pre-Project & Kick off project Tools : Project back ground & Project charter
MEASURE Progress : Measurement, Set-up target Tools : Pareto diagram, Primary Metric, Secondary Metric
ANALYZE Progress : Analyse data Tools : 5 Why
IMPROVE Progress : Implementation PO Flow Tools : Improvement action
CONTROL Progress : Control Tools : Standardization, Saving, Behavior
Figure 1. RoadmapSix Sigma project Source : Team Six Sigma RESULT AND DISCUSSION Fase Define At this stage the problem is defined as the six Sigma project. The purpose of this project is to minimize invoices without POs. It aims to reduce the risk of double payment (due to double invoice) by using 3 paths to match SAP to get better suitability and control. The focus of this project is to minimize the number of manual payment requests by 30% In December 2015. The goal of this project is to replace the current manual requisition creation with the standard PO according to flow (SAP) and become easier and to reduce the number Payment requisition manually per month. The benefits of this project are Conformity, avoid double payment and cost savings and reduce costs on the charge invoice and also the first project in APAC Fase Measure Based on data obtained from January to July 2015 for the amount of manual payment requisition (Invoice Without PO) then tabulated with target KPI which became the focus of Six Sigma project. The result of tabulation which is Primary metric as project trigger can be presented in the following picture:
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Figure 2. Invoice Without PO vs KPI target Source : Data Processed While the number of non PO vendors from january to july month which tabulated KPI target which is Secondary metric which also as trigger of project can be presented in the following picture:
Figure 3. Vendor non PO vs KPI target Source : Data diolah The number of problems that occur for Non PO Supplier include several things consisting of distribution cost of 27 suppliers, Government Bill as many as 8 suppliers, Unpredictable as many as 9 suppliers and Other as many as 16 suppliers. Based on these calculations, the distribution cost is the Opportunity Improvement and the biggest problem that must be resolved immediately, because based on pareto law when 80% problem is solved then the remaining 20% will finish by itself. The graph of the problem that occurs for Supplier non PO is as follows:
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Figure 4. Grafik Supplier Non PO Source : Data diolah Fase Analyze Based on phase of measure distribution cost become focus because the impact is dominant (27 supplier). From the results of Brainstorming with 5 way tools to find the root cause of Manual payment requisition in Philips Surabaya, the results obtained are a mapping from the root of the problem and the answer. The mapping is as follows: Tabel 2. Mapping Tools 5 Way Problem Difficulties of apply PO by system (1) Alot of Manual payment requisition (2)
Why-1 NO support from vendor
Why-2 No one vendor under global agreement use PO
Why-3 No Vendor socialization on implementation PR/PO process
SAP system not accommodate
data not maintenance in SAP
No12 NC created in SAP system
High cost charges of Infosys (3)
More expensive compare to using PO by system
complexity of account to be fill & mistake by human error
Alot of manual activities process
Late Payment (4)
Late Approval
Late submission
More time consuming for manual check / ensure correctness of paper work
Double Payment (4)
Double Invoice
Supporting document in copy
Lack control process
Not compliance (5)
High risk of loss money
Less control
All vendor in manual transaction (PR/PO process not implemented yet)
Source : Data Processed
Fase Improve After the root of the problem is known, the next step is to do a corrective action plan to overcome or prevent the problem that becomes the focus of Six Sigma project. At this stage is a
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mapping of the Action Plan where it is used as a basis for improving the process. The mapping can be presented in the following table: Tabel 3. Mapping Action Plan Potential Root Cause No Vendor socialization on implementation PR/PO process
No
Problem
1
Difficulties of apply PO by system
2
Alot of Manual payment requisition
No12 NC created in SAP system
3
High cost charges of Infosys
Alot of manual activities process
4
Late Payment/ double payment
5
Not compliance
Lack control process/ More time consuming for manual check / ensure correctness of paper work All vendor in manual transaction (PR/PO process not implemented yet)
Action Vendor socialization Material master upload in system by create 12 NC per destination in SAP Define posibility to simplify the process (using PR/PO) Involving all key parties to handle all process end to end customer
PO implementation
Source : Data Processed Based on table 4.2, known problems of the object of research, the root cause of the problem and its action plan. The details of each Action plan are as follows • Vendor Sosialiation Prior to the socialization, Vendors were not aware of the PR / PO process. After the Vendor's socialization is fully aware of the PR / PO process. Socialization is done by holding a meeting agenda with vendors. The target for vendor socialization is achieved which can be realized in October 2015 and the benefits obtained are the vendor is very aware with the program. • Material master upload in system Prior to the Six Sigma project there was no barcode for 12 NC, Code No Dept and No Account in SAP, this is because the code has not been uploaded. Or in other words Optimise the accounting information sistem by material master upload in the system
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Figure 5. No output Purchase Record before the barcode 12 NC uploaded Source :Output SAP As after the Six Sigma project is implemented and The barcode (12 NC), Departement Code and Account are created in accounting information system ERP_SAP , the output of the purchase record is as follows:
Figure 6. output Purchase Record available in the system after 12 NC uploaded Source :Output SAP The target for master uploaded in system material is achieved which can be realized in October 2015 and the benefit is the data well recorded in ERP_SAP information system • Number of Manual Payment of Requisition Prior to the run of its Six Sigma project many processes are running manually causing the charge invoice is high enough. Once on its run the Six Sigma project, the process becomes more Simple, robust process and better control. The benefits of this Action plan is to reduce cost and documents to be more concise. The target for the Number of Manual Payment of Requisition is achieved which can be realized in November 2015 and the benefits are cost reduction and concise documents. • End to End process, from customer to customer Before the Six Sigma flow project involves only Supply Chain and only the F & A departments, this is still lacking in terms of involvement and monitoring. The flow is as follows:
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Figure 7. Flow End to End customer to customerafter project Implemented Source : Data Processed The target for End to End process, from customer to customer is achieved where it can be realized in November 2015 and the benefit is reducing the risk of double invoice • PO Implementation Prior to implementing the project, payment is handled via manual payment request. The form of payment form is as follows:
Figure 8. Manual payment requisition by excel Source : Data sekunder After the Six Sigma project is implemented, the payment is handled through 3 ways of matching or matching between PO, receipt of goods and receipt of invoice. The form of payment form is as follows:
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Figure 9. Purchase Order form after project Source: Data Processed The target for PO Implementation is achieved where it can be realized in November 2015 and the benefits are suitability with standard form PO and reduce risk on double invoice Fase Control The control stage is the most important step because it is a repeat of unwanted processes where the benefits of continuous improvement must be obtained. In this section a control plan is made to the process. To ensure consistent PO procedures and formats are implemented consistently, the project team regularly conducts evaluations and discussions on the performance of processes that are the object of the Six Sigma project. The procedure is finally standardized into a detailed and standard documentation so that it really becomes an important grip for every transaction. Included is a flow chart diagram that after the improvement becomes more timelines but reduces the potential problem because the flow is too simple. Finally, the performance of the Six Sigma team shows the results achieved until December 2015 that is achievement of 47% where the expected target is 30%. The results are summarized in the scorecard graph as shown in the following figure:
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Number of Vendor Non PO KPI value
Jan Dec
60
KPI target
Feb
50 40
Nov
Mar
30 20 10
Oct
Apr
0
Sep
May
Aug
Jun Jul
Figure 10. Scorecard Grapht till Desember 2015 Financial Benefit obtained with the implementation of Six Sigma project are:A) Eliminate Double invoice / Payment for 508 K EURB) There is a saving on infosys charges of 2 K EURC) Intangible Benefit (compliance and better control)D) The first pioneer project in the Asia Pacific region (compared to other philips branches)E) Standarization and Learning process CONCLUSION Based on the data that has been analyzed along with the discussion that has been described in the previous chapter, the authors draw the following conclusions:1. Distribution cost is an Opportunity Improvement because it is the biggest problem compared to other problems.2. Difficulty applying PO by system is because No socialization to Vendor about implementation of PR / PO process. As for the action plan related to this is the socialization of vendors3. The large number of Manual payment requisition is because there is no 12 NC code available in the SAP system. As for the action plan related to this is to upload 12 NC on the master material in SAP system.4. The high cost of invoice charge is due to the number of manual process activities. As for the action plan related to this is to determine the possibility to simplify the process (using PR / PO)5. Late payment / double payment is due to Lack of control process / More time required to verify / verify work paper correctness manually. As for the action plan related to this is Involving all the major parties to handle all the process end to end customer6. Incorrect payment form is due to most of distribution supplier in manual transactions (PR / PO process not yet implemented). As for the action plan related to this is the implementation of PO 6. Suggestions From the results of the discussion and conclusions from research, can be stated the key to the success of the Six Sigma project is consistent with corrective action. The advice given by the researcher is to continuously improve the quality of operating system and transaction information by focusing on financial benefit, to achieve the company vision in undergoing competitive competition. One effort to improve the quality of operating system and transaction information focused on financial benefit are the continues improvement in this research. REFERENCES Breyfogle III, Forrest W. 2003. Implementing Six Sigma: Smarter Solutions Using Statistical Methods 2 nd ed. John Wiley & Sons Evans, Lindsay. 2007. Pengantar Six Sigma : An Introduction to Six Sigma and Process Improvement, SalembaEmpat, Jakarta. Federico, Mary, and Renee Beaty. 2004. Rath& Strong's Six Sigma Team Pocket Guide. McGraw-Hill
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Gaspersz Vincent. 2008, TheExeceutive Guide To Implementing Lean Six Sigma, GramediaPustakaUtama George, Michael L., Rowlands, David, Price, Mark and John Maxey. 2005. The Lean Six Sigma Pocket Tool Book. McGraw-Hill. Gitlow, PhD., Howard S., and David M. Levine, Ph.D. 2005. Six Sigma for Green Belts and Champions. Prentice Hall. Hendradi C.Tri.2007. Statistik Six Sigma dengan Minitab : PanduanCerdasInisiatifKualitas 6 Sigma, Penerbit ANDI, Yogyakarta Hidayat, Anang. 2009. Strategi Six Sigma. PT Elex Media Komputindo. Jakarta "KunalGanguly. 2012. Improvement Process For Rolling MillThrough The Dmaic Six Sigma Approach". International Journal Pande, Neumann, Roland R.Eavanagh.2002. The Six Sigma Way Bagaimana GE, Motorola & Perusahaan TerkenalLainnyaMengasahKinerjaMereka. ANDI. Yogyakarta Pande, Pete dan Larry Holpp. 2005. What is Six Sigma (BerpikirCepat Six Sigma), Penerbit Andi, Yogyakarta. Pande, Peter S., Neuman Robert P, dan Roland R. Cavanagh. 2002. The Six Sigma Way: Team Fieldbook, An Implementation Guide for Process Improvement Teams. McGraw-Hill. Pete & Holpp.2002. What Is Six Sigma. ANDI. Yogyakarta Singgih S. 2007. Total Quality Management (TQM) danSix Sigma, Elex Media Komputindo, Jakarta. Stagliano, A.A., 2004. Rath& Strong's Six Sigma Advanced Tools Pocket Guide. Penerbit Andi, Yogyakarta. Stagliano, Agustine A. 2004. Rath& Strong's Six Sigma Advance Tools Pocket Guide. McGrawHill, 2004. Thomas Pyzdek. 2002, Six Sigma Handbook, PenerbitSalemba
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7P MARKETING STRATEGY TOWARDS CUSTOMER SATISFACTION AND LOYALTY AT FITNESS CENTER X ON SURABAYA Stephanie Lauren Tessie, 2Denny Bernardus♠
1
Ciputra University Surabaya INDONESIA Email:
[email protected],
[email protected] ABSTRACT On uncertainty business weather, we need to use integrated marketing mix to get customer ‘s satisfaction and then we can get our customer’s loyalty. Marketer must understand what is the right marketing strategy that used to maintain the business. Marketing mix always be flexible and adapt to every business and country. On manufacture there are 4 aspect of marketing mix. In service industry we need more than that. Marketer need to consider people factor and intangible characteristic of service product. So we know modified marketing mix with 7p’s with people, physical evidence and process in addition. On this research, the Author analyze current marketing mix that used by Fitness Center X and analyze how it can impact on customer’s satisfaction and loyalty. The author found the marketing mix that used by Fitness Center X can impact on customer’s satisfaction and loyalty but it have some pro’s and con’s from the respondent. On this paper, author gather information from five respondent that contribute on Fitness Center X plus one fitness expert. The respondents are active member, ex-member, active trainer, ex-trainer and fitness expert. The author use triangle method to analyze respondent information. The author found that the product need more improvement on sport equipment and exercise menu to compete with competitor. On people strategy, the author found that some trainer didn’t have certified license and the exercise room is relative narrow and hot. The author use information from fitness expert and marketing literature to make some recommendation for new integrated marketing mix for Fitness Center X based on information from respondents. Keywords: Marketing Mix, Fitness Center, Satisfaction, Loyalty, Service industry, Product, Price, Place, Promotion, People, Physical evidence, Process.
INTRODUCTION The number of people who began to be aware of healthy lifestyles and began to exercise regularly, the more prevalent business opportunities in the field of sports is one of the providers of body fitness services or better known as a fitness center. In Indonesia, the fitness center business is also mushrooming in big cities such as Jakarta, Bandung, Surabaya, Semarang, and other cities. For most people of the city, fitness is a new vehicle as a means of sport that is comfortable and practical on the sidelines of busyness and work routine. Fitness can be done by all circles whether students, students, or executives, interested in becoming a fitness center with
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various purposes. Among others who want to tighten and build muscle, streamline the body, or just keep fit. The number of sports center facilities with a variety of well-known brands sparked increasing competition among corporations, various services and marketing companies are doing to survive in this business. Improved services are provided so that customers feel comfortable about the services provided and for customers to be loyal to the company. Table 1 Data Franchise Fitness Center
Source : www.waralaba.com, 2013 Location choosing is important aspect in fitness center industry to approach the target market. The pricing strategy is necessary aspect to determint profit business and competitiveness advantage. There is come competitor that very strong and close to Fitness Center X. Table 2 Membership Price of Fitness Center Comparison on Surabaya 2016 Fitness Center Admin Fee Membership Fee (/month) Rp. 199.000 Rp. 385.000 – Rp. 446.000 (one club) Rp. 580.000 (all club) Rp. 625.000 (VIP club) Rp. 684.000
Rp 280.000 (one club) Rp 495.000 (all club)
Rp. 25.000
Rp. 475.000 (Regular) Rp. 250.000 (Student) Rp. 600.000 (Temporary)
sources: www.harga.web.id In business the products or services quality, cannot be separated from the quality of services provided. Quality is key to customer satisfaction and loyalty. If the consumer is satisfied then he will show the possibility to buy again the product, even forward the information to others around him. While dissatisfied consumers will do the opposite. In this case the service is considered very necessary to pay attention to the quality of the service itself, because satisfied consumers are likely to make use of further services. Service is not just how employees deal with customers but applies as a whole, is the provision of good facilities and qualified employees can improve customer satisfaction. Fitness Center X is a body fitness services company located in Surabaya city, located in G-Walk area of West Surabaya and has approximately 600 to 700 member each year. Fitness Center X owners have started this service business since last July 2013, due to the existence of business opportunities in this field. According to the database of number of members on each month, there is an increase and decrease in member visits. This is due to the number of similar businesses that lead to competition between companies. The existence of competition between similar companies
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trigger members to try to other fitness centers or decide to switch back using the fitness center in Fitness Center X and because there is a gap in this service. In its development, this becomes a big enough problem for the businessman provider of sports facilities (fitness center). Here's the monthly Fitness Center X's data from August 2015 to July 2016: Customers measure the performance or achievement of the company in different ways, or can also misrepresent the quality of the service. It will certainly attract consumers to make purchasing decisions is the quality of products or services offered by the company. Companies that are able to compete in the market are companies that can provide quality products or services. Service is an absolute must by every company. Fitness center services should not only fixated on sports infrastructure but also provide services to improve the satisfaction of its members. It can be utilized by service providers to provide services that meet the expectations of the community as users of sports services. The development of the industrial sector including sports services cannot be separated from the demand to keep paying attention to the quality of service. Exceptional service should pay attention to the price, due to the speed of service requested by the customer that the more expensive tariff is charged to the service that requires the quickest solution. Location becomes a determinant for consumers in reaching the intended service, strategic location close to the market and easy to reach become the reason for consumers to become customers who will make repeat purchase continuously. Determining the location of a place for each business is an important task for marketers, because wrong decisions can lead to failure before the business begins. Choosing a trading location is an important decision for a business that must persuade customers to come to the business place to meet their needs. With the right company location determination, it will be able to serve customers satisfactorily, acquire enough manpower, acquire good goods at competitive prices, and enable the expansion of the company. Price is also very determine customer satisfaction in the use of these sports services, because the amount of member fees set related to the level of income owned by the customer. The higher cost of fitness services will result in customers having to think twice in the use of the fitness services, and vice versa if the cost of the use of fitness services is lower then customers tend to utilize the services of fitness without doing more consideration. The membership price is Rp 700.000, - for 10 class sessions and Rp. 2,838,000, - for 12 personal trainer sessions. Meanwhile, incidental or per-time is Rp 275.000, - for Personal trainer and Rp 100.000, - for class, Fitness Center X gives competitive membership price. The company provides a fairly competitive price against its members to remain loyal. A consumer-oriented company should always think about satisfaction, and what services are favored by consumers so that it is not only satisfied that it can, but be loyal and return to the company to make purchases or re-consumption. LITERATURE REVIEW Service Marketing Zeithmal and Bitner (2003: 3) describe the services marketing are all economic activities whose results are physical or construction products, which have time consumed along with time produced, and provide added value in the form (convenience, convenience, health, etc.) Which is essentially intangible. Service marketing can also be interpreted as "any action or deed that can be offered by a party of other parties that is essentially intangible and does not produce something" (Amstrong & Kotler, 2006). Marketing services are economic activities in the form of intangible products that the process of production and consumption together and not give ownership of something. According to Kotler and Keller (2009: 39-42) services have four different characteristics that greatly affect the design of marketing programs, including intangibitity; inseparability; variability/ heterogeneity/inconsistency; perishability. Marketing Mix Marketing mix strategy was first introduced by Borden inspired by Culliton’s (1948) research on good business executives described as a mixer ingredients that combine various strategies to
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achieve goals and face competition. Borden uses business mixer ingredients concept in marketing program and successfully formulate the concept of marketing mix and element of marketing mix element (Borden, 1965) Marketing mix according to Bordern (1965) is a combination of various strategies of marketing programs that are used to achieve goals. McCarthy (1964) categorizes the marketing mix element to 4p and defines the marketing mix as a control variable that can be coordinated and combined by the company to satisfy the target market. Armstrong and Kotler (2006) add the definition of marketing mix as a set of controlled marketing variables and combined by the company to respond to market target demands. In the beginning, the Marketing mix introduced by Borden (1965) consists of 12 elements: 1) Product planning, 2) Pricing, 3) Branding, 4) Channel of distribution, 5) Personal selling, 6) Advertising, 7) Promotion, 8) Packaging, 9) Display, 10) Servicing, 11) Physical handling, 12) Fact finding and analysis. In the next several periods McCarthy (1964) grouped 12 elements of borden into 4P marketing mix consisting of several categories: product, price, place, and promotion. Each category is a combination of several marketing program elements. For example promotion mix consists of marketing advertising program lever, publicity (branding), personal selling, sales promotion (Amstrong & Kotler, 2006). McCarthy's 4P concept got some criticism. Some studies suggest that 4P is still too simple and lacks all the needs of the target market (Kent, 1986). Some argue that 4P is less effective in service marketing areas because it does not consider participant factors in which the service industry makes market targets very often in contact with participant Booms and Bitner (1981). Therefore, in marketing services Booms and Bitner add 4P concept to 7P by adding Process, Physical Evidence, participant. Product Goods or services sold in the market to be consumed by consumers to meet their needs are called products (Amstrong & Kotler, 2006). In addition, the product according to David Cravens (1996: 3) is anything that has value in a target market where its ability to provide benefits and satisfaction including objects, services, organizations, places, people and ideas. Product decisions include the determination of physical offerings, brands, packaging, warranties and after sales services. Product development can be done after analyzing the needs and wants of the market. According to Borden (1984), products should be quality that can attract customer loyalty, among others through the design and the name of the product. Price Price is the value charged to the service or product provided to the customer. Price has a significant impact on customer psychology and influences the decision to buy back the product (Kotler et al., 2008). Product pricing decisions depend on many factors, including customer purchasing power, product costs, and product shipping costs (Parasuraman & Grewal, 2000). Price is the main factor behind customer satisfaction and loyalty, where customer satisfaction and loyalty will be easy to get if the customer feels that he has benefited from the product he bought (Peter & Donnely, 2007). Place The place in the marketing mix is called the distribution channel, the channel where the product reaches the consumer. The definition of Sumarni and Soeprihanto (2010: 288) about distribution channels is a channel used by producers to channel the product from producer to consumer or user industry. According to David W. Cravens (1996: 27) the distribution is an organization network that performs functions that connect manufacturers to end users. Promotion According to David W. Cravens (1996: 76) promotion is to inform people about products and convince buyers in the target market of a company, channel organization and the general public to buy their goods. Included in promotional activities include advertising, direct selling, and publicity.
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Participant In marketing services, the marketing mix concept framework was added by Booms and Bitner (1981) with participant, physical evidence, process. Adding 7P to the service industry. Booms and Bitner (1981) explains that the participant aspect is all human beings who play a role in the distribution of value services called personnel and other customers In the service industry (especially in high contact service such as restaurant, education, barber shop, consulting, fitness center) where direct service production is consumed by consumers, the role of personnel is very important in influencing consumer perceptions about product quality (Rafiq and Ahmed, 1995). In the service industry, employees inherit the product and product quality can not be separated with the quality of its service providers. (Berry, 1984). Therefore, it is very important for the company to pay attention to the quality of the employees and monitor the performance of the employees that can improve the quality of service. Participant concepts also include customers who buy services and other customers. Marketing managers should focus not only on customerservice provider interactions, but also on the behavior of relative customers (Rafiq and Ahmed, 1995). For example, the number, type and behavior of other customers in a restaurant will affect the customer's appetite. Physical Evidence Physical evidence according to Boomers and Bitner (1981) refers to an environment in which services are delivered from service providers to consumers and visible goods that facilitate performance and communication in service. Physical evidence is an important aspect of the service industry because consumers need visible clues to assess service quality. The more intangible the services offered, the more the need for higher physical evidence to make services more visible (Shostack, 1979). As an example of the banking industry, providing credit card and ATM card services and savings account books as physical evidence to make banking services visible and consumers can trust the bank. The physical environment (building, decoration, furniture, layout) is also a consumer assessment tool for assessing service quality as examples such as the comfort of the physical environment in restaurants, hotels, retailing, tourist resorts is a tool that determines good or bad service quality (Rafiq and Ahmed, 1981 ). Process The procedures, mechanisms and flow of activities required in service delivery refer to the process concept in the 7P concept framework developed by Booms and Bitner (1981). As an example of the process of taking your own food at Mc Donald's fast food outlet, consumers have to queue up for order and then serve the food within 3 minutes and then the consumer is free to eat wherever they want. This process is very different from the process of receiving food at full-service restaurants served by waiters and have to wait for about 20-30 minutes of food. This service process will be assessed by consumers in terms of convenience, convenience, speed, accuracy of the process (Rafiq and Ahmed, 1991). Customer’s Satisfaction Customer satisfaction can be the basis for the realization of loyal or loyal customers. Philip Kotler (1997) suggests that consumer satisfaction is the level of one's feelings after comparing perceived performance or results compared with expectations. Satisfaction is defined as a person's pleasure or disappointment of comparing perceived product performance in relationships and expectations. In Kotler's other opinion of satisfaction, it is a function of perceived performance and expectations. If the performance of a product or service is lower than expected, consumers will feel dissatisfied. If performance is as expected then consumers will feel satisfied, if performance exceeds expectations, then consumers will feel very satisfied (funed) (Kotler, 2001). The concept of customer satisfaction is abstract. Many experts provide definitions of customer satisfaction. Day (in Tjiptono, 2004: 146), defines customer satisfaction or customer dissatisfaction is the customer response to the perceived nonconformity evaluation
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between the previous expectations and the actual performance of the perceived product after usage. Customer satisfaction will be influenced by product delivery system, product or service performance, corporate image, product / brand image, price value associated with value received by customer, employee achievement, competitive advantage and weakness. This is in line with what Philip Kotler, 1993 (in Pratiwi, 2010: 37) states that the key to retaining customers is customer satisfaction. Satisfied customers will: repurchase, inform the company about good things to others (recommendations), pay less attention to competitor brands and advertisements, and buy other products from the same company. Customer’s Loyalty Customer loyalty is the reaction or result of the creation of customer satisfaction as the implementation of the success of quality services in meeting customer expectations (Pratiwi, 2010: 41). Loyal customers are those who are enthusiastic about the brand or the products they use. Customers who are loyal to the purchase decision, no longer consider the factors that are distinguished in the determination of choice because it has been embedded in him that the product or service purchased in accordance with expectations and needs. Customer loyalty reflects the intended behavior of a product or service. The intentions behaving here include the possibility of upcoming purchases or renewal of service contracts or vice versa, as well as how customers will switch to service providers or other brands (Selnes, 1993, in Sinaga, 2010: 44). Retailing behavior in strong brand sensitivity behavior is categorized as loyalty, in which consumers tend to buy or reuse the same brand and consider brand choice to be very important to them. In contrast, repeat purchases in weak brand sensitivity situations are categorized as inertia, ie consumers tend to buy back the same brand, but they do not consider brand names important, because they can not distinguish between different brands (Fibrianto, 2011: 35). Griffin argues (in Musanto, 2004) that a customer is said to be loyal or loyal if the customer shows a regular purchase behavior or there is a condition in which the customer requires at least two times at a certain interval. RESEARCH METHODS This study uses a consumer approach in which a qualitative descriptive approach that presents a systematic review of scientific information derived from the subject or object of research (Sanusi, Anwar, 2011: 13). Research Subject The total subjects of this study were 5 people: one active member of Fitness Center X randomly selected, one ex-member of Fitness Center X who used to be an active member and now has moved to the competitor's fitness center X which will also be selected randomly , One Fitness Center X employee who will be randomly selected to find out the conditions internally, one exemployee of Fitness Center X who is now a competitor of Fitness Center X, and one Fitness Expert resource person to cross check the findings of the average consumer With the expert in their field to get the results that not only meet the expectations of consumers, but also in accordance with the theory from the point of view of an expert. Research Object The object of this study is the marketing strategy of Fitness Center X. The research on the object is devoted to the customer's loyality through customer satisfaction by using the marketing mix (marketing mix method) or 7P. RESULT Data Gathering To test the research framework, the researcher assesses the perception of fitness center X members about the marketing mix strategy. Then the researchers assess the level of member
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satisfaction and member loyalty level. To assess the perception of fitness center X members, researchers used descriptive qualitative approach where respondents' perceptions on aspect aspects in marketing mix strategy described based on information from respondents in accordance with the study criteria. The data collected are primary data that comes from interviews with resource persons, the interview process is determined in accordance with the schedule of resource persons and the desired source Qualitative research is used to examine the condition of natural objects, where researchers are key instruments (Sugiyono, 2010: 15). The goal is to understand a phenomenon by emphasizing the process of deep communication interaction between researchers with the phenomenon studied (Herdiansyah, 2010: 9). This study uses a consumer approach in which a qualitative descriptive approach that presents a systematic review of scientific information derived from the subject or object of research (Sanusi, Anwar, 2011: 13).
Informan Active Member Ex-member
Fitness Experience 2 years
Tabel 3. Respondent Data Name age Jabatan / pekerjaan
Coding
Heny
35 Yo
Housewife
AM
4 years
Shandy
36 Yo
Housewife
EM
Active Worker
2 years
Elga Rahman
24 Yo
AK
Ex-Worker
4 years
25 Yo
Fitness Expert
10 years
Ahmad Agung Susana Tatto
Supervisor Knowledge Division & Development Training Department Fitness Center X Personal Trainer at Celebrity Fitness Fitness Consultant & Personal Trainer, Director Fitness Center X
37 Yo
EK FE
Sources : Informan Data Interview result is analyzed by data triangulation method to obtain validity and reliability of information to be analyzed by writer. Respondent response to markting mis In this study, the results of the interviews were analyzed by citing information from informants. Then the researcher summarized the assessment of 7p marketing mix into the pros and cons categories. The following is the presentation of the summary results and cons of respondents' assessment of Marketing Center X's marketing mix. Table 4. Marketing Mix Pros and Cons at Fitness Center X Marketing Mix Strategy
Pros
Cons
Product
- Focus TRX suspension - Effective functional training - Brand Fitness Center X is quite familiar in western Surabaya
- Need update the popular training variation, the completeness of the product is still lacking - Fitness Center X does not have insurance services for members
Price
- Competitive price around
- Increasing Price policy charged on long-time
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Rp 700.000,- per 12 sessions - Easy payment method
member , the price of services for each session is less favored for members who are actively practicing
Place
- Strategic location near where the target consumer lives - Easy and safe vehicle access
Promotion
- Provide an attractive sales promotion - Spread flyers to public places (Church) , use social media to communicate marketing messages and sales promotions
Range of flyer spread is still in narrow scope Trainer friendly and polite
People
-Trainer friendly and polite - Trainers have a high commitment in training - Trainer look attractive and convincing
- Only a few trainers with complete certificate in accordance with standard fitness training requirements issued by APKI (Association of Indonesian fitness trainers)
Physical evidence
- Clean exercise room - Comfortable lobby Certificate stamped in lobby
- Narrow exercise room - Selection of yellow color for the blinding room of the eye when exercising
Process
- Fun training process
- Consultation with less active trainers
Source : Internal Data Analysis. Respondent Satisfaction and Respondent Loyalty Based on the results of interviews with active members and ex-members, researchers can describe the satisfaction felt by consumers and consumer loyalty in fitness center X. The following explanation from the source of consumer satisfaction on Fitness Center X services and the reasons: "Yes I am satisfied" (AM, C-5, 112) "Yes I am satisfied" (EM, D-5, 112) "Some are satisfied and some are not. Customer is satisfied usually because of the results obtained from the TRX exercise. But for the unsatisfied usually due to the less widespread and less clean "(AK, E-5, 110) "For ministry not all members are satisfied" (EK, F-5, 110) The informants largely describe that consumers are satisfied with Fitness Center X. As for the dissatisfaction of members due to less widespread and less clean place according to active employees. For more details, the following explanation of satisfaction and dissatisfaction reasons member on Fitness Center X service: "Because the trainer is patient and really really in training. The number of members who exercise only 15 so I get enough attention from trainers and trainers can know one by one member and direct well "(AM, C-5, 114) "Yes satisfied, from the aspect of the product TRX is very successful in maintaining ideal body weight and lower blood sugar. Besides, the Trainer is patient, patient and caring in my training. Then from Fitness Center X location adjacent to where I live. An intensive collective training process with 15 members only. "(AM, C-6, 118)
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"Because the trainer is professional and TRX can provide optimal results on my body health. My weight became ideal and my body was tight again. In addition, my friends and relatives practice a lot here, so it's like my private firness place. "(EM, D-5, 114) "... But there needs to be additional additional classes like boxing and zumba" (EM, D5, 116) ".... But for the unsatisfied usually due to the less widespread and less clean "(AK, E-5, 110) "Updates to sports equipment, bathroom cleanliness, dressing room and room should be maintained from morning to night, when making policies should be negotiated first with employees and also members" (EK, F-5, 112) The informants describes the satisfaction of Fitness Center X service because the TRX training effectiveness performed by the member gives optimal result and helps the member achieve their training goal. The dissatisfaction caused by the lack of variation of the exercise menu, the lack of exercise area, the cleanliness of the room that is less awake throughout the day, less terupdatenya sports equipment, policy making is less open. Loyalty behaviors undertaken by members may be in the form of recommending Fitness Center X to their colleagues. Here's a description of the loyalty behavior of members from resource persons: “Yes”(AM, C-6, 122) “Yes” (EM, D-5, 122) "Yes. Many brothers, friends and fellow members are invited to join in Fitness Center X. besides many members who educate their friends about the importance of regular exercise for health and fitness body "(AK, E-6, 120) "Willing" (EK, F-6, 120) Based on the informant's information, member's loyalty can be realized in the behavior of recommending Fitness Center X service to colleagues, relatives, and friends. In addition, many members are educating friends and relatives about the benefits of regular exercise for the health of the body and the benefits of TRX training to their relatives. 7Ps Integrated Marketing Mix Recommendation for Fitness Center X Based on the results of interviews and analysis of the pros and cons of marketing mix strategy the researcher can propose some proposed improvement of marketing mix to fitness center X as follows: 1. Provide a certified and experienced fitness trainer with at least a minimum of one year training experience with CFT, CPR, STS, SNA certification. (People and physical evidence) 2. Adding a popular and popular community training program that is Zumba, Strong by Zumba, Yoga, and Boxing (product). With the provision of experienced trainers and additional programs, the quality of services offered will increase. This is in accordance with marketing expert's statement,"Because of the simultaneity of production and consumption, the firm's personnel occupy a key position in influencing customer perceptions of product quality. In fact, those products are inseparable from the quality of the service providers (Kotler and Keller, 2013: 45)." 3. With the addition of programs and using an experienced fitness trainer, operational costs will also increase. Due to maintain a qualified trainer, the trainer's allowance is quite high. Therefore, researchers suggest the application of higher pricing when compared with competitors. (Price) 4. To provide differentiation, a safe service for the elderly member can be a differentiator with competitors. Researchers provide input to the fitness center to add a medical check up process before the exercise to determine the physical readiness of members before doing
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the exercise. This process has never been done by another fitness center. This is expected to reduce the risk of accidents during sports such as heart failure in the elderly member. This process can be done by testing blood pressure, heart rate test and member breathing test. (Process) 5. To maintain the comfort of exercise, researchers suggest fitness center X to choose a new, wider place with a fresh air circulation and cleaner bathroom facilities. (Physical evidence) 6. If you can choose a new location, the researcher suggests choosing a location adjacent to a shopping center, place of worship or school. This is because the place becomes a place of day-to-day activities target market, especially housewives. (Place) 7. Researchers also proposed the design of the exercise to be more private as a differentiator with competitors. Fitness center X can create new procedures by limiting maximum number of members in a class maximum of 20 people. (Process) 8. To support the private class, the fitness center can design a more private room with the use of window film for exercise activities are not visible from outside the room. (Physical evidence) 9. To convince the member that the quality of professional trainer, fitness center X can display the certificate of trainer certificate and the hall of fame of the trainer with its portfolio so that member is confident and believe in the quality of fitness service. (Physical evidence) 10. Social media is currently the fastest and cheapest communication channel in delivering promotional messages. Target fitness center market in western Surabaya the majority often use Instagram as a means of social with their colleagues and relatives. Fitness center X can use Insta story some sports activities together by members then distribute the activity to members who are on the move with the permission of members of course to maintain privacy. Instastory is distributed is expected to attract follower members to be interested in fitness center X. (promotion) Summary Based on the results of the study, it can be seen the effectiveness of marketing mix that has been developed by fitness center X can give satisfaction to its members and later can increase the loyalty of its members. But there are still some cons of some marketing mix strategy fitness center X which became the concern of members in choosing a fitness center. The most important cons of here is the experienced and certified trainers are still lacking in the fitness center X. The experienced fitness center switched from the fitness center X because of the difference in benefits. In addition, the other marketing mix cons is the practice menu only one variant. Sometimes members want to try the fun and relaxing exercise menu. Many members who train in fitness center with varied program will be a one stop training center and he will usually move there. In this research there is something quite interesting, the biggest motivation of fitness center X members is to keep the body fit and body posture to stay ideal. In addition, the reason of customer satisfaction is more care and politeness from trainer in smaller class, it is necessary to build a private class service consisting of 15-20 people. Private class can give more attention to the members during practice. Another differentiation that X gyms can offer is to keep exercise safe by adding a medical check-up before exercise to save a heart attack and retiree. The suggestions in this study are as follows: 1. The theoretical suggestion of this research is the highly developed services industry in Indonesia needs more research developed for marketing services. The application of 7P is a strategy that consists of several dimensions. Each of the 7p dimensions must relate to one another mingle and balance each other to cover the weakness and increase the company's strength. In the next research needs implementation of quantitative test to know the
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significance of influence 7P marketing mix towards satisfaction and loyalty society in Surabaya. 2. Suggestions for practitioners, especially the management of the fitness center X are those that provide something different from competitors when offering a higher price. Offer higher prices with higher quality also for customers to repeat training. Means of advice to make differentiation is to provide safe services for elderly members with a medical check up process before the exercise, create a private class with 15-20 people so that trainers can focus more on all members, providing experienced and certified trainers so that members can reach Their goals are happy and optimal. REFERENCES Armstrong, Kotler (2015), “Marketing an Introducing Prentice Hall twelfth edition” , England : Pearson Education, Inc. Armstrong, G. and Kotler, P. (2013). Principles of Marketing, 14th ed., Prentice- Hall, Englewood Cliffs, N.J. Badan Penelitian dan Pengembangan Kesehatan Departemen Kesehatan Republik Indonesia (2013). Riset kesehatan dasar nasional. Berry, L.L. (1984), “Services marketing is different”, in Lovelock, C.H. (Ed.), Services Marketing, Prentice-Hall,Englewood Cliffs, NJ, pp. 29-37. Booms, B.H. and Bitner, M.J. (1981), “Marketing strategies and organization structures for service firms”, in Donnelly, J.H.and George, W.R. (Eds), Marketing of Services, American Marketing Association, Chicago, IL, pp. 47-51. Borden, N.H. (1965), “The concept of the marketing mix”, in Schwartz, G., Science in Marketing, John Wiley & Sons, New York, NY, pp. 386-97.Cravens, D. W. & Piercy, N. F. (2007). Strategic Marketing (9th ed.). MC Graw Hill. Culliton, J.W. (1948), The Management of Marketing Costs,Division of Research, Graduate School of Business Administration, Harvard University, Boston, MA. Djaja S, Soemantri S, Irianto J. (1986-2001) Perjalanan transisi epidemiologi di Indonesia dan implikasi penanganannya, studi mortalitas-survei kesehatan rumah tangga. Herdiansyah, Haris. (2010). Metodologi Penelitian Kualitatif untuk Ilmu-ilmu Sosial. Jakarta: Salemba Humanika. Kent, R.A. (1986), “ Faith in the four Ps: an alternative”, Journal of Marketing Management, Vol. 2 No.2, pp. 145-54. Kotler, P. H., & Bowen, J. T. (2010). Marketing for Hospitality and Tourism (5th ed.). New Jersey: Pearson Education. Kotler, Keller. (2012), Marketing Management: 14 Edition, New Jersey: Prentice Hall, Pearson Hall, Pearson Education, Inc. Kotler, Philip and Keller, Kevin Lane (2013), Manajemen Pemasaran, Jilid 1, Edisi 13, Erlangga. Kotler, Philip & Armstrong, Gary. 2014. “Principles of Marketing” (14thEdition). Pearson, New Jersey McCarthy, E.J. (1964), Basic Marketing, Richard D. Irwin, Homewood, IL. McCarthy, E.J. dan Perreault, W.D. Jr (1987), Basic Marketing, 9th ed., Richard D. Irwin, Homewood, IL. Moleong, Lexy J. (2013). Metode Penelitian Kualitatif. Bandung: PT. Remaja Rosdakarya. Rafiq, M. dan Ahmed, P. (1995). Using The 7Ps As A Generic Marketing mix: An Exploratory Survey of UK and European Marketing Academics’, Marketing Intelligence and Planning, 13(9):4-15. Sekaran, U. (2011). Research Methods for Business : A Skill Building Approach 2nd Edition, John Wiley and Son. New York.
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Shostack, G.L. (1979), “The service marketing frontier”, in Zaltman G. and Bonoma, T. (Eds), Review of Marketing, American Marketing Association, Chicago, IL, 1979, pp. 373-88. Siregar, Syofian. (2013). Statistik Parametrik untuk Penelitian Kuantitatif. Jakarta : PT. Bumi Aksara Sugiyono. (2010), Metode Penelitian Pendidikan Pendekatan Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta. Tjiptono, Fandy dan Gregorius Chandra (2011). Service, Quality, Satisfaction Edisi kedua. Yogyakarta: Andi Wahyuni, A. (2012). Kajian Bauran Promosi Di Perguruan Tinggi “X”. Jurnal Liquidity, 1(2), 175-182. World Health Organization (2014). Global database on body mass index. An interactive surveillance tool for monitoring nutrition transition. Zeithaml, V. and Bitner, M. (2003). Services Marketing: Integrating Customer Focus Across the Firm, Second Edition, Irwin McGraw-Hill.
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MARKETING STRATEGY DESIGN IN PT. MITRA JASA ENGINEERING USING SWOT AND QSPM METHODS Didit Setyo Nugroho, 2Tommy Christian Efrata♠
1
Ciputra University Surabaya INDONESIA Emails:
[email protected] ABSTRACT The growing number of manufacturing industries in East Java and the large number of industrial estates under development suggest a huge opportunity for the contractor services industry to gain market share. The existence of these opportunities is also offset by the increasing number of service contractors who established their companies. The tight competition makes the company PT. MitraJasa Engineering to have a proper and effective marketing strategy in order to win the competition. The purpose of this research is to design the right marketing strategy at PT. MitraJasa Engineeringusing SWOT and QSPM methods. The design of the marketing strategy uses two alternative strategies, the first alternative strategy is to use the old strategy used by the company and the next alternative using the strategy obtained from the analysis of internal and external factors of the company. Both alternatives will be juxtaposed in the QSP matrix to be processed to produce alternative strategies which are selected. Results of QSP matrix analysis show that alternative strategy of SWOT analysis result is the most appropriate strategy used in PT. MitraJasa Engineering with a total value of TAS is greater i.e. 5.370. Key Words: IFE Matrix, EFE Matrix, SWOT, QSP Matrix, Marketing Strategy
INTRODUCTION The growing number of manufacturing industries in East Java and the large number of industrial estates under development suggest a huge opportunity for the contractor services industry to gain market share. The above opportunities prove that opportunities from the construction industry will continue to grow along with economic growth in Indonesia. PT. MitraJasa Engineering is a company located in Gresik City. This company is engaged in construction services that stood since 2010 with the name of CV. MitraJasa Engineering, as time goes by and its increasing quality, in 2012 the company changed its legal entity into PT. MitraJasa Engineeringto be increasingly trusted by consumers to use the services company. PT. MitraJasa Engineering has the company's objectives stated in its vision of "Becoming a leading national private construction services company that can meet the needs of customers in the field of construction, production and suppliers services by paying attention to product quality and good corporate governance." In an effort to achieve the vision PT .MitraJasa Engineering has its missions such as "Prioritize customer satisfaction and trust through professionalism. Become a company known as a construction service company that holds integrity values, respected, qualified, and put the principle of zero accident. Providing welfare to
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employees, managers, and shareholders.Working with national and international construction companies in increasing competencies in the era of globalization. Currently, the organizational structure of PT. MitraJasa Engineering is all filled by Human Resources (HR) who hasbackground in engineering. So in the process of project work, PT. MitraJasa Engineering always get a very good appreciation, not even rare PT. MitraJasa Engineering get awards from the project employer. But the weakness of PT. MitraJasa Engineering is the management of corporate marketing strategy is still very simple. Since the company was established, PT. MitraJasa Engineering does not have marketing management as the reference in corporate promotional activities. The strategy used by the company in reaching the market share is simply by using the word of mouth communication and using the relation of the company owner. The lack of company knowledge about marketing management makesthe company’s promotional activities run without direction. Without a clear management and marketing strategy, the company is also unaware of the company's internal conditions and also the opportunities that exists in the market. This condition can affect companies because similar construction companies are more ready to grab market share of PT. MitraJasa Engineering. Starting from a very simple marketing strategy at PT. MitraJasa Engineering, this research will use SWOT method in analyzing factors from internal and external point of view of the company to know and to use QSPM method to assist in the determination of alternative marketing strategies between simple marketing strategy that used by company (using word of mouth and link from the owner) and the strategy obtained from the analysis with SWOT method. RESEARCH METHODS 1. Type of Research This type of research uses a qualitative research paradigm. This qualitative research is descriptive research using case study method, because the problem under study is a case study about the company PT. MitraJasaEngineering as well as describe the company's competitive strategy through SWOT and QSPM analysis. According to Sujarweni (2015: 24), case study method is a research on human(can be a group, organization or individual), event, in-depth background.The purpose of this research is to get an in-depth picture of a case under study. This descriptive research was chosen to find the right marketing strategy solution by finding or deeply digging the information needed from the informants. According to Bungin (2011: 69) descriptive research format is more appropriate when used to examine the problems that require in-depth study to obtain a solution from a study or to solve existing problems. 2. Subject and Research Object Research object is what is being targeted in the research being carried out by the researcher or concretely illustrated in the problem formulation (Bungin, 2011: 78). The object studied in this research is PT. Mitra Jasa Engineering. Subjects in this study are also called informants. Sampling technique in this research uses purposive sampling. According to Sugiyono (2013: 368), purposive sampling is a technique of sampling data source based on certain considerations. Subjects taken in this study are similar companies, the expert and also the internal company. 3. Data Collection Method Methods in this research using explorative methods on the source and using descriptive analysis. Data collection in this research usinginterview technique and also documentation. According to Setyadin in Gunawan (2015: 160), an interview is a conversation directed at a particular problem and an oral questioning process in which two or more people are
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physically opposite. Interviews conducted to obtain data or information as much as possible and as clear as possible to the subject of research. The type of interview conducted in this study is semi-structured interview technique. In this study the researcher will use documentation as the evidence to strengthen and complement the interviews to informants. According to Sugiyono in Gunawan (2015: 179), document study is a complement of the use of observation and interview methods in qualitative research. The documentation used in this study is an official document originating from PT. MitraJasa Engineering. 4. Data Collection Method To strengthen the validity of the data, researcher used data triangulation as a process to establish the degree of trust (validity) and degree of consistency (reliability). According to Gunawan (2015: 219), triangulation is a means of obtaining data that is perfectly valid using a dual method approach. RESULTS AND DISCUSSION 1. Results of SWOT Analysis 1. Strength A. PT. MitraJasa Engineering has experienced staff. B. The accuracy and quality of the work has a good track record in the company of the project giver. C. The company's commitment to maintain zero accident. D. Completeness of certificates of companies both in terms of material and human resources (Human Resources). E. The number of link companies make services that can be done PT. MitraJasa Engineering more diverse. 2. Weakness A. Lack of sales force makes PT. MitraJasa Engineeringwork less than maximal in marketing the company. B. The lack of marketing tools makes PT. MitraJasa Engineeringnot optimal in marketing the company. C. The enterprise management system is still very simple. D. Lack of company knowledge about the new groove system in becoming a vendor or get a project. E. Only have an office in Gresik so rarely get information and conditions from outside. 3. Opportunity A. Many governmental development plans such as power supplementation projects. B. There is an increase in the construction of multi-storey buildings. C. The need for periodic maintenance of tools and machinery in oil and gas processing companies. D. The well-known performances of the company make the company will be a reference. E. There is an expansion of industrial area in Gresik and East Java City, making many big industrial companies start to build their company. 4. Threat A. The number of competitors is very much. B. High competition makes price competition tighter and reduces the value of profit. C. The high political factor in determining the contractor to work on the project. D. The existence of MEA makes the foreign workers and many foreign goods entering Indonesia.
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E. Easy for people who have experience to enter in this industry. 2. IFE Matrix Analysis Results Based on the results of IFE matrix processing obtained the total value of IFE Matrix with a total score of 2.71. The value is derived from the sum total of the multiplication of the weight of each factor that exists on the rating of each factor. Table 1. IFE Matrix
3. EFE Matrix Analysis Results Based on the results of the EFE Matrix processing obtained the total value of EFE Matrix with a total score of 2.68. The value is derived from the sum total of the multiplication of the weight of each factor that exists on the rating of each factor. Table 2. EFE Matrix
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4. QSP MatrixAnalysis Results The result of QSP matrix analysis obtained from the discussion with the procurement of PetronasCarigali shows the value of TAS (Total Attractiveness Score) of conventional strategy is 4,260 while the TAS value (Total Attractiveness Score) from strategy obtained through SWOT analysis is 5,370.The data shows that the strategies obtained through SWOT analysis are more effective for the activities and marketing strategies of PT. MitraJasa Engineering due to higher score than conventional strategy. Table 3. QSPM Matrix
CONCLUSION AND RECOMMENDATION 1. Conclusion This study aims to choose which strategy is more effective and efficient with internal condition of PT. MitraJasa Engineering and also in accordance with existing external situations. There are several stages to find the appropriate strategy for the PT. MitraJasa Engineering. Researcher refers to David's theory (2011: 177) about the stages of formulating a strategy. Researcher was first required to analyze internal factors and also external factors of the company through a SWOT analysis that would result in other alternative strategies. And also the points of the SWOT analysis are then used as IFE and EFE matrices. The matricesare useful for determining the weight value to be included in the QSP matrix. The QSP matrix aims to see which strategy has the greatest TAS value considered the most appropriate strategy for PT. MitraJasa Engineering. Based on the research that has been done then alternative strategy is selectedwhich has the highest TAS score with the value of 5.370. With the result, the problem formulation of this
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research has been resolved because the chosen strategy is the strategy obtained from SWOT analysis by considering internal and external factors. In this study researcher also gets a lot of recommendations from the informants. It can be seen from the many changes and developments of the strategy of PT. MitraJasa Engineering previously With the development or improvement strategy PT. MitraJasa Engineering are expected to be able to take advantage of existing opportunities so that PT. MitraJasa Engineeringcan be more easily in conducting marketing activities that will impact on increasing the number of clients. 2. Recommendation In this study there are many improvements for the strategy of PT. MitraJasa Engineering. So the researcher provides suggestion so that managerial implication in this study can be run by PT. MitraJasa Engineering, the suggestions include: A. PT. MitraJasa Engineeringneeds to complete the certification for materials and services. B. The collection of documents and certification of the company should be made as attractive as possible so that the employer will immediately understand what the company has. C. Have a useful marketing team to find data about the user or new project that will run. D. Maintain good relationship with the user or consultant. E. Always follow the development of the purchasing system at the employer company. F. Quality of work should take precedence. With the revamping of marketing activities at PT. MitraJasa Engineering and SWOT analysis results, then the suggestion that also needs to be applied is the company should focus on the field of ability to be a specialization company in order to maximize the services that the company is working on. For further research, researchers can increase the number of informantsso that the results of research becomes more diverse and will create a new more varied strategy. And also the next researchers are expected to have an alternative backup strategy if this strategy couldn’t be implemented maximally. The limitations of this study are the results of this study couldn’t be applied to companies other than contractors, because the factors and informants studied are those that are related to contractor companies. REFERENCES Abadi, A. Zangi. and Ahmadi, Dariush. 2012. Strategic Planning for Waste Management: A Case Study of Shiraz Waste Management. Iran: Growing Science Ltd. Abya, Hamid, et al. 2015. Strategic Planning for Tourism Industry Using SWOT and QSPM. Iran: Growing Science Ltd. Afrizal. 2015. Metode Penelitian Kualitatif. Jakarta: PT. Raja Grafindo Persada. Amir, M. Taufiq. 2011. Manajemen Strategi Konsep dan Aplikasi. Jakarta: PT. Raja Grafindo Persada. Anderson, Torben Juul. 2013. Strategic Management. United Kingdom: Cambridge University Press. Badan Pusat Statistik (BPS). 2015. Realisasi Investasi Modal Dalam Negeri Menurut Provinsi. Diakses dari: https://www.bps.go.id/linkTabelStatis/view/id/1336. Diakses pada tanggal: 06 April 2016 pada pukul 19.38.06 WIB.
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Badan Pusat Statistik (BPS Jatim). 2015. Pertumbuhan Ekonomi Jawa Timur Triwulan III-2015. Diakses dari: http://jatim.bps.go.id/Brs/view/id/322. Diakses pada tanggal: 03 April 2016 pada pukul 19.30.59 WIB. Bungin, Burhan. 2011. PenelitianKualitatif :Komunikasi, Ekonomi, Kebijakan, danIlmuSosialLainnya. Jakarta: KencanaPernada Media Group Cakrawijaya M Amin, RiyantoBambang. 2014. Evaluasi Program Pembangunan InfrastrukturPerdesaan di DesaWonokerto, KecamatanTuri, KabupatenSleman. JurnalPerencanaan Wilayah dan Kota – Vol. 25, No. 2. David, Fred R. 2011. Strategic Management Concept and Cases. New Jersey: Pearson Education. Digilib.its.ac.id. Jumlah Kontraktor Jawa Timur. Diakses dari: http://digilib.its.ac.id/public/ITSMaster-7042-3104203011-bab1.pdf. diakses pada tanggal: 10 April 2016. Fahmi, Irham. 2015. Manajemen Strategis Teori dan Aplikasi. Bandung: CV. Alfabeta. Gunawan, Imam. 2015. Metode Penelitian Kualitatif Teori dan Praktek. Jakarta: PT. Bumi Aksara. Harrison, Jeffrey S. And John Caron H. St. 2014. Foundations in Strategic Management. 6th International Edition. USA:South-Western, Cengage Learning. Jaya, Dwiandira A.A.N.B. et al. 2014.PengaruhPendapatanAsli Daerah PadaBelanja Modal DenganPertumbuhanEkonomiSebagaiVariabelPemoderasi.EJurnalAkuntansiUniversitasUdayana 7.1. Kotler, Philip danAmstrong, Gary. 2009. Prinsip – PrinsipPemasaranJilid 2 EdisiDuaBelas. Jakarta: Erlangga Kotler, Phillip dkk. 2012. ManajemenPemasaranPersoektif Asia, BukuDua. EdisiPertama. Yogyakarta : Andy Padmalia, Metta. 2014. AntesedendanDesenden Dari KegembiraanHatiPelangganMelaluiAnalisis Moderator. Salatiga. Rangkuti, Freddy. 2013. SWOT Balanced Scorecard. Jakarta: PT. Gramedia Pustaka Utama. Rangkuti, Freddy. 2015. Analisis SWOT: Teknik Membedah Kasus Bisnis. Jakarta: PT. Gramedia Pustaka Utama. Robinson, Richard B. And Pearce II, John A. 2013. Manajemen Strategis: Formulasi, Implementasi, dan Pengendalian Edisi 12-Buku 1. Jakarta: Salemba Empat. RusnanidanAndini, IsnaniYuli.2014. StrategiPemasaran Batik Madura DalamMenghadapiPemasaran Global.Jurnal “PERFORMANCE” Bisnis&Akuntansi Volume IV, No. 2. Sistem Informasi Kawasan Industri Jawa Timur (SIKI Jatim). 2015. Daftar Nama Kawasan Industri. Diakses dari: http://www.siki.jatimprov.go.id/index.php?act=detil&id_kawasan=005&pos_x=7.144830989653611&pos_y=112.64597940375097&id=027. Diakses pada tanggal: 03 April 2016 pada pukul 21.22.39 WIB. Solihin, Ismail. 2012. Manajemen Strategik. Jakarta: Erlangga Sujarweni, V. Wiratna. 2015. Metodologi Penelitian Bisnis dan Ekonomi. Yogyakarta: Pustaka Baru Press. Sugiyono, 2012.MemahamiPenelitianKualitatif. Bandung: Alfabeta Sugiyono, 2013.MetodePenelitianManajemen. Bandung: Alfabeta Permatasari, Desy Erika. 2015. Penentuan Strategi Bisnis Manajemen Hotel Dalam Menghadapi Persaingan (Studi Kasus di Quds Royal Hotel Surabaya). Jurnal Administrasi Bisnis (JAB) – Volume 27 No. 1. Yulita, U. Veranda. Et al. 2013.AnalisisStrategiPemasaranPerumahanBekasiTimurRegensi 3. JurnalSistemIndustri – Volume 7 Nomor 1.
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Usman, Yulita Veranda. et al. 2013. Analisis Strategi Pemasaran Perumahan Bekasi Timur Regensi 3. Jurnal Sistem Industri – Volume 7 nomor 1. Walukow, Merlina Ivoletti. and Pangemanan, Ahane Anneke. (2015). Developing Competitive Strategic Model Using Quantitative Strategic Planning Matrix (QSPM) Approach for Handicrafts Ceramic Industry in Pulutan, Minahasa Regency. Indonesia, Bali: Elsevier Procedia 2nd Global Conference on Business and Social Science. Widiasanti, Irika dan Lenggogeni. 2014. Manajemen Konstruksi. Bandung: PT. Remaja Rosdakarya.
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THE ABILITY OF CASH FLOWS STATEMENT IN PREDICTING THE PROFIT OF THE GO-PUBLIC COMPANIES 1
Eni Wuryani
Universitas Negeri Surabaya INDONESIA Email:
[email protected] ABSTRACT It is important for the companies to be able to predict the profits in any business progress. Therefore, attempts to analyze the cash lows should also be conducted for that purpose. The study has its purpose to analyze the ability of cash flows in predicting the company’s profit. The data used consists of the entire annual financial statements taken from the go-public companies as listed in the Indonesian Stock Exchange (Bursa Efek Indonesia or BEI) in 2014-2016. These listed companies are of 225 companies for analysis. It has its independent variable that is cash flow statement using the proxy of operating cash flow, investment cash flow, cash flow financing. The dependent variable is in the form of profit. All these data were analyzed using multiple linear regressions. From the analysis, it was found as the following. It indicates that cash flow statement is proved to be able to predict the companies’ profit. Furthermore, it is the fact that all the information contained in the financial statements of cash flows can be expected to assist the investors in making decisions whether they continue to invest their capital. . Keywords: Cash Flow, Operating Cash Flow, Cash Flow Investment, Financing Cash Flow, Income, Multiple Regression Liner, Go Public Company, Indonesia
INTRODUCTION Cash flow statement represents the company's ability to generate cash, plan, control incoming and outgoing cash. Therefore, it can also provide information to assess a company's ability to generate cash and cash equivalents, develop models to assess and compare the present value of future flows of various companies. In this respect, historical cash flow information can become an indicator of the amount of time and certainty of future cash flows, as well as check the accuracy of estimated future cash flows and determining the relationship between the profitability and net cash flow and the impact of price changes. Some benefits of cash flows as based on The Indonesia Association of Accountants or IAI (2009), cash flow statement can provide information that allows the users to evaluate the changes in net assets, financial structure (including liquidity and solvency) and the ability to influence the amount and timing of cash flows in the context of adaptation to changes of circumstances and opportunities. In addition, high profit does not guarantee that the company is
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in good shape if there is not enough cash to pay obligations as they are in maturity date because the company would complicate it to keep operating. Cash in this case is the most liquid working capital needs to be utilized properly in order to get maximum results and suitable for the company’s needs. Harahap (2008: 255) states that the cash flow statement is a report that provides relevant information about the cash receipts and disbursements in a given period by classifying transactions in operational activities, financing, and investment. A good company condition can be seen from the financial statements, a complete financial report consisting of the balance sheet, income statement, statement of changes in equity, cash flow statement and notes to the financial statements (IAI, 2009). Recognizing the inherent weaknesses in the income statement, the researchers used the cash flow statement as a predictor of the profits. The investors or users of financial statements need more cash flow information for cash describe the company's ability to survive and not be affected by problems such as measurement of profit. In the income statement shows income earned in one period. SFAC No. 2 describes the characteristics of accounting information to be used in decisionmaking, in this statement; there are two main characteristics that make accounting information useful in decision-making, namely the relevance and reliability. Relevant accounting information is capable of influencing economic decisions users by helping them evaluate past events, present, and future. While reliable accounting information is reliable information about the condition and showing the actual performance of the company (FASB, 1980). OBJECTIVES OF THE STUDIES This study attempts analyze the ability of a cash flow statement in the earnings forecast. In this effort, cash flows are measured by operating cash flow, cash flow investing, and financing cash flows. MATERIALS & METHODS Signaling Theory Signaling Theory as described by Spence (1973) is that a good quality company can differentiate itself with a company of poor quality through a credible signal to the capital markets on the quality of its performance. This theory explains the urge companies to provide information to external parties. Signals can be given that the information contained in the financial statements. Given this information, it is expected to assist investors in making decisions in investing. Signal theory provides accounting information and it can reduce the information asymmetry between management and investors. The disclosure of financial statements, one of which in the form of a cash flow statement, can be a good or bad signal which will affect the decision of investors to invest in companies that generate profits. The cash flows are disclosed in the financial statements can help investors in making investment decisions. Cash flows for the year can be used by investors to predict company’s profit. Thus, the cash flow is good for the investors in getting confidence that the investment is right. Financial Statements Financial statement is a report containing the financial information of an organization. It is published by the company as the result of the accounting process. It is intended as a means of communicating financial information primarily to external parties. Financial report is a report that is designed for decision makers, especially outside the company, the financial position and results of operations of the company (Soemarsono, 2004: 296). Financial statement has a purpose to provide information about the financial position, financial performance and cash flows of the entity that will benefit the majority of users in making economic decisions report. The financial statements also show the results of management
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accountability for the use of the resources entrusted to them. In order to achieve the objective of financial statements, financial statements provide information about an entity that includes the assets, liabilities, equity, and income, and expenses, including gains and losses, contributions from and distributions to owners in their capacity as owners and cash flow. That information, along with other information contained in the notes to the financial statements, the report helps users predict future cash flows and in particular, the timing and certainty of cash and cash equivalents acquired (IAI, 2009). Francis et al. (2004) divides the two major groups of financial reporting quality attributes, the attributes of accounting-based and market-based. Financial reporting quality attributes based accounting is accrual quality, persistence, predictability, and income smoothing. For the quality attributes, it is a fact that a market-based financial statement includes value relevance, timeliness, and conservatism. Francis et al. (2008) found that companies that show good earnings quality tends to provide greater voluntary disclosure of the companies with poor earnings quality. Yet, McNichols (1989) find that management earnings forecast prediction contains errors related to historical stock returns, where managers neglect to include the information that is contained by the stock price into their profit predictions efficiently. The prediction error may arise from errors of judgment about the prospects of the company's business manager. Also an uncertain operating environment can aggravate knowledge information manager, which also leads to errors of judgment about the prospects of the business manager (Hirshleifer, 2001). The users of financial statements according to the Framework for the Preparation and Presentation of Financial Statements of Financial Accounting Standards paragraph 9 (IAI, 2009), it is stated that users of financial statements include present and potential investors, employees, lenders, suppliers and other business creditors, customers, governments and other agencies and the public. Components of the complete financial statements according to IAS 1 paragraph 49 (IAI, 2009) consists of the following: a. balance sheet, b. income statement, c. statement of changes in equity, d. cash flow statement, e. notes to the financial statements. Based on the Statements of Financial Accounting Concept 2 Qualitative Characteristics of Financial Information (Qualitative Characteristics of Accounting Information) this statement aims to provide quality characteristics that must be possessed by the accounting information so that the information becomes more useful. a. Relevance of information Relevant information if the information is said to have benefits, according to the actions to be taken by users of financial statements. In other words, the relevant information is the ability of a manager to influence decisions or other financial statement users that the existence of such information or support is able to change their expectations about the results or consequences of any actions taken. b. Feedback value and predictive value of the relevant elements Information can make different decisions by improving the ability of decision makers to predict or to correct their initial expectations. Information effect on human behavior and because different people may react differently to the information, the financial information can be evaluated by means of forecasting the extent of truth on the basis of that information. Predictive value is an important consideration in separate accounting information relevant and irrelevant.
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c. timeliness Timeliness is an aspect of relevance supporters. When information is not available when needed or available after a period after reporting that information has no value for future action. Such information has relevance and benefits low. Timeliness means that the availability of information in decision making before the information is lost influence capacity in influencing the decision. d. Reliability of information Reliability is the quality of information that can lead to the use of accounting information, which is highly dependent on the correctness of the information produced. Reliability of the information is highly dependent on the ability of information to appropriately describe the circumstances / events that are described in accordance with the actual conditions. e. representational faithfulness Representational faithfulness relates to the degree of correspondence between the measurement or description of the phenomena described. In accounting phenomena described are economic resources, obligations, transactions and events that change resources and obligations of the entity. Sometimes the information is not reliable due to errors of interpretation. Statement of Cash Flows In Indonesia, the cash flow statement should be reported in 1994 by Statement of Financial Accounting Standards (SFAS) No. 2 paragraph 1. It states that the company should prepare a cash flow statement and should present the report as an integral part of the financial statements for each financial statement presentation period (IAI, 2009). This policy is of course related to the benefits that can be taken by users of financial statements, especially investors and creditors. IAI (2009) explained that information about a company's cash flow is useful to users of financial statements as a basis for assessing the company's ability to generate cash and cash equivalents and assess the need for the company to use the cash flow. A company’s cash flow information can help in predicting future earnings (Sloan, 1996). Kieso and Weygandt (2002: 373) also argue that the statement of cash flows is useful to help investors, creditors, and other parties in assessing the entity's ability to generate cash flows in the future. Simply put cash is important. If the company does not have enough cash, then the employee's salary cannot be paid, the debt cannot be paid, dividends cannot be paid, and the equipment cannot be bought. Cash flow statement shows how the cash is used and where the cash is coming from. Employees, creditors, shareholders, and customers have an interest in this report because they can see the cash flows that are occurring in the company. By examining the company's investment activities (purchases and sales of assets other than products) and financing activities (borrowing and repayment of loans, investments by owners and distributions to owners), one cash flow statement readers can better understand why assets and liabilities increases or decreases during a period. Components of Cash Flow Cash flows from operating activities IAI (2009) explains that the amount of cash flows arising from operating activities is an indicator that determines whether the operating company can generate sufficient cash flows to repay loans, maintain the operating capability of the enterprise, pay dividends and make new investments without recourse to external sources of financing. Information about the specific
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components of historical cash flow along with other information is useful in predicting future operating cash flows. Cash flows from operating activities are primarily derived from the principal revenue-producing activities of the company. Therefore, cash flow is generally derived from transactions and other events that affect the determination of net profit or loss. IAI (2009) describes examples of cash flows from operating activities are as follows: 1) Cash receipts from sales of goods and services 2) Cash receipts from royalties, commissions, and other income. 3) Cash payments to employees. 4) cash receipts and payments by insurance companies for premiums and claims, annuities and other insurance benefits. 5) Cash payments to suppliers of goods and services. 6) Cash payments or receipts back (refund) for income tax unless specifically identifiable as part of the financing and investment activities. Harahap (2008: 256) also describes that operating activities are principal revenue-producing activities of the company and other activities that are not investing activities and financing activities, transactions and other events that cannot be considered as investment or financing activities. Here are the characteristics of the transaction cash inflows and cash outflows operating activities: Cash flows from investing activities IAI (2009) states that the separate disclosure of cash flows arising from investing activities is important because the cash flows reflect the cash receipts and disbursements in connection with resources that aims to generate income and future cash flows. According to IAI (2009) cash flows arising from investing activities are: 1) Cash paid for purchase of fixed assets, intangible assets and other long-term assets, including capitalized development costs and self-constructed assets. 2) Cash receipts from the sale of land, buildings and equipment and intangible assets and other long-term assets. 3) Acquisition of shares or other financial instruments 4) Advances and loans made to other parties as well as the repayment (unless committed by a financial institution) 5) Cash payments in connection with futures contracts, forward contracts, option contracts and swap contracts except when the contracts are carried out for the purpose of trafficking (dealing or trading) or if the payments are classified as financing activities. Cash flows from financing activities According to IAI (2009), a separate disclosure of cash flows arising from financing activities is important because useful in predicting claims on future cash flows by the suppliers of the company's capital. Financing cash flow is the cash flow generated from the issuance of new shares or bonds, dividend payments, stock repurchases, debt borrowing or repayment of debt. According to IAI (2009) Cash flows from financing activities are as follows: 1) Cash received from issuance of shares or other capital instruments. 2) Cash payments to shareholders to withdraw or redeem shares of the company. 3) Cash received from issuance of bonds, loans, notes, mortgages and other loans. 4) Repayment of loans. 5) Cash paid by the tenant (lessee) to reduce the balance of liabilities relating to finance lease (finance lease).
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Method of Preparation of Cash Flow Statement IAI (2009) revealed two alternative presentations of the net cash flow from operating activities. In this case, cash flow operating activity is what distinguishes the direct method and the indirect method. Direct method is essentially a re-examination of every profit and loss accounts with the aim to report how much cash is received or incurred in connection with the account (Stice et al., 2009). The indirect method starts with net income reported in the income statement, and adjust this accrual rate for everything that does not affect cash flow (Stice et al., 2009). The adjustment is in three basic things: 1) Income and expenses not involving cash inflows and outflows. 2) Gains and losses due to investing activities or financing activities 3) Adjustment for change-change in current assets and liabilities indicating the sources of noncash income and expenses. Both methods produce the same amount of the net cash flows used in operating activities. The indirect method is preferred and used by many companies because it is relatively easy to use and reconcile the differences between net incomes to net cash flows from operating activities. The users of financial statements mainly used more direct method because this method directly reported source of cash inflows and cash outflows without having to be confused with the adjustment to net income. Profit One of the main objectives of the company's operations is to get a maximum profit. It is important for management to predict their profit expected by the company. SFAC No. 1 states that earnings information is used to assess the performance of management help predict the long-term earnings capacity, forecast earnings estimate risk in borrowing or investment (FASB, 1978). Income prediction is important because it provides information to investors and creditors that help them predict the amount, timing, and uncertainty of future cash flows (Kieso and Weygandt, 2002). Febrianto and Widiastuty (2005) describe that the third number the accounting profit gross profit, operating income and net income is useful for measuring the efficiency of managers in managing the company. Investors and creditors believe that the preferred performance measure in assessing the company's performance is a measure of performance that is able to describe the condition and future prospects of the company better. This company is based performance assessment through the information on the income statement that presents information in gross profit, operating income and net income. Gross profit is the difference between the company's revenue minus the cost of goods sold. Cost of goods sold are sacrificed all costs, for companies invoice calculation starts from the stage when the incoming raw materials to the plant, processed, until sold. All costs directly associated with the creation of these products are classified as cost of goods sold (Febrianto and Widiastuty, 2005). Operating profit is gross profit margin to operating costs while operating costs are those costs associated with the operation of the company or the costs that often occurs in the company and operative. Moreover, these costs are assumed to have a relationship with income generation. Among the operating expenses are the cost of employee salaries, administrative costs, travel expenses, advertising and promotion costs, depreciation costs and other (Febrianto and Widiastuty, 2005). Net income indicates the difference between the total income of the company's operations and non-operating companies. Thus, the actual net income is income that shows the profits to be retained in the company and which will be distributed as dividends. Each of the
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earnings results has its own information content that can be used to predict earnings and future cash flows (Febrianto and Widiastuty, 2005). Company conducts operations aim to maximize profits in order to maintain the viability of the company (Bringham, 2006: 69). Prediction of corporate profits is very important to be done in determining the company's stock price in the future (Sundaresh, 2008). High profits can be seen from the performance of the company, the higher the profits, the better and the company’s performance. The information about profit contained in the income statement often be paid attention by investors (Beattie et al, 1994). Cash Flow Statement on Earnings All companies need cash for the same reasons however different their principal revenueproducing activities (revenue producing activities). If the company can manage the operational and investment, it can easily obtain funding to be used in the operations of the company, it will affect the performance of the company in generating profits. According Manurutng (2009) are usually cash and net income move together, the high cash flow tends to cause an increase in profit and vice versa. Patmono (2004) examined the cash flow statement and the ability of earnings forecast where cash flows are comprised of the operating activities, investing and financing activities. These are used in predicting earnings in which it can show that, it is either used alone or together with cash flows from operating, investing and financing influence significant impact on future earnings. Investment analysts use more financial information relating to receipts and disbursements that better reflect liquidity than income information. Wulandari (2005) analyzed the cash flow within the company forecast earnings. The results of the tests have been carried out. It indicates that the cash flow can simultaneously predict earnings, partially only operating cash flow are having a significant impact on corporate profits in the future of cash flow from operating activities that show the company is able to operate as a profitable read by investors. Yaniartha (2010) examined the predictive ability of earnings and cash flows in predicting earnings and cash flow in the future. This research results show that (1) the ability of earnings to predict earnings predictors of one year to the next is not better than the ability of earnings to cash flow predictor (2) the ability of predictors to predict cash flow cash flow next year better predictor than the current capability cash to earnings (3) the ability of earnings does not provide incremental prediction of the cash flow predictor. The ability of current cash flow is not better predictor than cash flows in predicting future cash flows in accordance with the theory set forth in SFAS # 2 regarding the usefulness of the information flow cash is useful to assess the company's ability to generate cash and cash equivalents and enables users to develop models to assess and compare the present value of future cash flows. Wardani (2013) examined the model comparison of aggregate and disaggregate models of operating cash flow to predict future earnings. The results showed that the model of aggregate and disaggregate models of operating cash flow cannot explain future earnings consistently, but disaggregate models of operating cash flow can predict future returns better than the model of aggregate cash flow operating activities due to disaggregate models consisting of components accrual and the separation of net CFO is a major component of the activity is the company’s contributor with greatest value in the statement of cash flows operating activities that affect the company's profit. Dwiati (2008) examined the ability of cash flow, earnings, and accruals to predict future cash flows and future earnings. The results showed that the cash flow and earnings and cash flow can also predict future earnings. Cash flow can predict earnings due to the cash receipts and disbursements, especially from operating cash that will affect profit or loss. For that reason, the hypothesis can be stated as follows:
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H1: Cash flows affect the income Operating Cash Flow to Profits True operating activity is information about some transactions such as the sale of goods, receivables, and other income and payment-load liability. Yuliafitri (2011), Nuraina (2011) gives the result that operating cash flow effect on earnings. In theory, if the value of cash flows from operating activities showed a high value, it can be said that the income earning of the company is greater than the liability of the company in that period. Earning will create revenue stream inflow while the load will create cash flow exit. Nuraina (2011) examined the ability of operating cash flow in predicting future operating earnings. The results of the study stated that the current cash flow can be used for predicting future operating earnings. Transactions in operating cash flow entering the determination or the determination of net income (net income). So the higher the cash flow from operating activities shows the company is able to operate profitable, because of the operation of any enterprise activity can generate cash well. Yuliafitri (2011) also examined the ability of operating cash flow and earnings in predicting future cash flow on companies listed in Indonesia Stock Exchange. The results showed that the effect of operating cash flow in one year forecast earnings to future operating cash flow. It can affect the determination of net profit or loss for the company's largest revenue comes from its operating activities. Operating cash flow statement can be used to assess how can the company generate any income in cash and cash equivalents for the company which will affect company profits will be accepted. The second hypothesis can be stated as follows: H2: Operating cash flow effects earnings Investing Cash Flow to Profits Investment activities are the acquisition and disposal of long-term assets and other investments not included in cash equivalents (IAI, 2009). Cash flows from investing activities can be considered for forecasting earnings, cash flow investment as can be demonstrated on the acquisition and disposition of corporate assets where fixed assets are the resources that support the company to get income. In the previous study, Patmono (2004) gave the result that the investment cash flows have an impact on earnings. In theory, if the value of the cash flows from investing activities showed high value which can be said that the result of the acquisition of the fixed asset sales has higher value than the purchase of fixed assets. That is, the result of the acquisition of the asset sales or profit increases due to the decrease effect. Proceeds from asset sales will create cash flow while asset purchases will create cash flow of the company. Therefore, the third hypothesis can be stated as follows: H3: The cash flow affects investment earnings Financing Cash Flow to Profits Financing activities are activities that result in changes in the number and composition of capital and loan companies. Previously, Patmono (2004) provide results that financing cash flows have an impact on earnings. The higher total financing cash flows shows that a high proportion of ownership will have an impact on investor confidence and the effect on earnings of the company. It is stated that the higher the financing cash flows shows that the company has a lot of action relating to the capital increase and the payment of long-term debt, so the picture of capital and the obligation will show a high proportion of ownership. The sale of shares will
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create cash flow stream for the company, while the long-term payment obligations will create cash flow out of the company. Based on the above description, the hypothesis is formulated as follows: H4: Financing cash flows affects the income METHODS FOR EXPERIMENTAL This study uses SPSS regression for analysis and the data are the entire annual financial statement data publicly traded companies as listed on the Indonesian Stock Exchange (BEI) in 2010-2012. There are 225 data used in this research. The data used in this research is the documentation of data, using purposive sampling in getting the data. The independent variable is that the cash flow statement using the proxy operating cash flow, investment cash flow, cash flow financing, and the dependent variable in the form of profit. Cash Flow The independent variable is the cash flow. Cash flow is a report that provides relevant information about the cash receipts and disbursements of a company in a given period to classify transactions for operations, finance and investment. Cash flow in this study is divided into three namely operating cash flow, cash flow investment and financing cash flows. Operating Cash Flow Operating activities according to IAI (2009) is the principal revenue-producing activities), and other activities that are not investing activities and financing activities. In cash flows from operating activities include the sale of merchandise or services, revenues from subscriptions, royalty income, commission fees, other remuneration, interest income and dividends. Cash out flows of activity include payments to suppliers, employee payroll, tax payments, and interest payments and other costs. Cash Flow Investment Investing activities according to IAI (2009) are the acquisition and disposal of long-term assets and other investments not included in cash equivalents. Cash inflow of activity investment is the sale of fixed assets and sale of long term investments. On the other hand, cash outflow from investment activities is the purchase of fixed assets, and the purchase of long-term investment. Financing Cash Flow Financing activities according to IAI (2009) are activities that result in changes in the number and composition of capital and loan companies. Cash inflow from financing activities is namely the issuance of new shares and the issuance of debt (bonds). Cash outflow from financing activities are dividend payments, withdrawal of shares (treasury stock), and the payment of long-term debt. Profit Earnings are the net profit. Net income is the excess of revenue over expenses charged which is a net increase of capital, net of tax Regression Analysis The analysis model used is a model of multiple linear regression analysis. This multiple regression analysis is used for testing how the direction of the dependent variables is and how the independent variables are towards the dependent ones. The analysis used for testing such formula can be seen as follows:
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Profit = β0 + β 1AKOt + β 2AKIt+ β 3AKPt + e Description: Profit : Net profit β0 :Intercept β 1,β 2,β 3 : Slope from the regression AKOt : Cash flow AKIt : Investment cash flow AKPt : Financing cash flow e : Error term RESULTS AND DISCUSSION Results The results from a description of each of variables are presented in Table 1. Table 1. Results of descriptive statistic testing Source: SPSS Output Data processed N Min Max Mean Operating 18.368.4 225 169.889.532.129 36.897.407.979,44 cash flow 63 Investme nt cash 225 413.897 182.029.127.313 25.492.244.658,77 flow Funding 225 82.706 153.223.344.000 25.273.666.157,44 cash flow 63.591.2 Profit 225 2.065.884.091.526 67.453.174.074,25 18
Std. Deviation 41.291.023.449,142 32.453.814.690,500 32.113.124.599,151 200.794.900.518,146
Based on Table 1, the results of the analysis using descriptive statistics to operating cash flow indicates the minimum value of Rp 18,368,463 achieved by PT. ATPK Resources; The maximum value of Rp 169 889 532 129 achieved by PT. Bank Bumi Arta with an average value of 36,897,407,979.44 and has a standard deviation value of 41,291,023,449,142. The results of the analysis using descriptive statistics on investment cash flow indicates the minimum value of Rp 413 897 achieved by PT. ATPK Resources; The maximum value of Rp 182 029 127 313 achieved by PT. Nusantara Infrastructure with an average value of 25.492.244.658,77and has a standard deviation of 32,453,814,690.500 value. The results of the analysis using descriptive statistics to financing cash flows show the minimum value of Rp 82 706 achieved by PT. Harato Tarinka; The maximum value of Rp 153 223 344 000 achieved by PT. Bank Agroniaga with an average value of 25,273,666,157.44 and has a standard deviation of 32,113,124,599.151 value. The results of the analysis using descriptive statistics on earnings showed a minimum value of Rp 63,591,218 achieved by PT. Centris Multi Pratama Persada; The maximum value of Rp 2,065,884,091,526 achieved by PT. Arpeni Pratama Ocean Line with an average value of 67,453,174,074.25 and standard deviation values sebesar200.794.900.518, 146. Classical Test Assumptions Normality Test Results Normality test results it is necessary to test the data statistically using Kolmogrov- Smirnov test. Based on Table 2 obtained a significant value of un-standardized residuals subsequent to the data by using a log10 transformation is equal to 0.128 or 12.8% so un-standardized residuals can be said to be normally distributed because of significantly greater value than the value of significant level of 0.05 or 5%. Autocorrelation Test Results
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Autocorrelation test aims to test whether the linear regression model is no correlation between the errors in period t with bullies bully error in period t-1 (previously). To test whether autocorrelation can be detected with a test run statistical tests. A regression equation is said to be free if the autocorrelation test results of the run's tests of significance greater than 0.05. Based on the test results of the test run in table 2 note that the significance of the unstandardized residual value of 0.946 is greater than 0.05 means are random. It can be concluded that the regression model in the study free of autocorrelation. Here Kolmogrov- Smirnov tests results: Table 2. results of Normality and Autocorrelation test
Asymp. Sig. (2-tailed) Unstandardized Residual
Normality test
Autocorrelation test
One Sample KS
Runs Test
0.128
0.946
Sources: Data Output SPSS processed Test Results multicollinearity Multicollinearity can be seen from the value of tolerance and VIF. Both of these measurements indicate each independent variable Which explained by other independent variables. Values used to indicate the presence of multicollinearity is tolerance value <0.10 or equal to the value of VIF> 10 And vice versa if the VIF <10 then there is no multicollinearity. As in Table 3, it can be seen that the value of the entire known tolerance values above 0.1 and VIF values below 10 so it can be concluded that the regression model is free from multicollinearity. Test Results heterocedastity Based on Table 3, it obtained the significance of un-standardized residuals of each independent variable amount of more than 0.05, so it can be concluded that the regression model does not occur heterocedastisity. The following are the test results and test multicollinearity Heterodasidacity: Table 3. Test Results and Test Heteroskidastity Multicollinearity Multikolinearity test
Heteroskedacity test
Indep Variables
Tolerance Value
VIF Value
Description
Sig. (2-tailed) Unstandardized Residual
Operating cash flow
0.803
1.246
No multicolonearity
0.962
Investment cash flow
0.797
1.255
No Multicolonearity
0.152
Funding 0.801 1.248 No Multicolonearity 0.810 cash flow Test Results of multicollinearity Multicollinearity can be seen from the value of tolerance and VIF. Both of these measurements indicate each independent variable Which explained by other independent variables. Values used to indicate the presence of multicollinearity is tolerance value <0.10 or equal to the value of VIF> 10 And vice versa if the VIF <10 then there is no multicollinearity. As in Table 3, it can be seen that the value of the entire known tolerance values above 0.1 and VIF values below 10 so it can be concluded that the regression model is free from multicollinearity.
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Test Results heterocedastity Based on Table 3 obtained the significance of un-standardized residuals of each independent variable amount of more than 0.05, so it can be concluded that the regression model does not occur heterocedastisity. The following test results and test multicollinearity Heteroskidastity: Table 4. Test Results and Test Heteroskidastity Multicollinearity heterocedastity test Multikolinearity Test Independent variables
Tolerance Value
Operating cash 0.803 flow Investment cash 0.797 flow Funding cash 0.801 flow
VIF Vale
Description
Sig. (2-tailed) Unstandardized Residual
1.246
No multikolinierity
0.962
1.255
Noi multikolinierity
0.152
Tidak terjadi 0.810 multikolinieritas Source: Data Output SPSS processed
1.248
Linear Multiple Regression analysis Multiple linear regression analysis was intended to examine the extent to which and how the direction of the independent variables affect the dependent variable. Therefore, researcher conducted a data transformation using the formula log10 transformation of the regression equation is mathematically formulated as follows: Β1AKOt LogLABA = β0 + + + β2AKIt β3AKPt + ε The results obtained by multiple linear regression analysis the magnitude of the constants and regression coefficients for each variable are as follows:
Exogenous Variable
Endogenous Variable
Cash flow Operating cash flow (X1) Investment cash flow (X2) Financing cash flow (X3)
Profit Profit Profit Profit
Table 5. Testing the Path Coefficient Estimation tpCoefficient statistic value
Description
9,870
167.459
0,000
Significant
0,0000000000007843
7,258
0,000
Significant
0,0000000000001060
0,768
0,443
Tidak Significant
0,0000000000004535
3,261
0,001
Significant
Based on Table 4 the results of multiple regressions, the cash flow statement can predict earnings with significant value of 0.000 which is smaller than the significance level of 0.05. Based on these results Hypothesis 1 is accepted. Furthermore, based on the partial test, the operating cash flow affects earnings with a significance value of 0.000. The significant value is 0.000 which is smaller than the significance level of 0.05 so that Hypothesis 2 is accepted.
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Investing Cash Flows has no effect on earnings with a significance value of 0.443. Significance value of 0.443 is greater than the significance level of 0.05 was concluded reject Hypothesis 3. Acrua financing cash impact on earnings with a significance value of 0.001. 0.001 significance value is less than the 0.05 level so it can be concluded receive Hypothesis 4. DISCUSSION Based on the regression test simultaneously the proxy statement of cash flows into operating cash flow, investment cash flow, cash flow funding has an influence on earnings. The results of this study support the research Patmono (2004), Wulandari (2005), Wardani (2013), Dwiati (2008). These results endorse the Signaling Theory signal is given in the form of the information contained in the financial statements of the consolidated cash flow can be predicting earnings. Given this information, is expected to assist investors in making decisions in investing. Operating cash flow to earnings The results of statistical calculation provide indication that operating cash flow has a partial effect on earnings. It also provides results that operating cash flow relationship with profits is a positive effect. That is, the higher the total current year operating cash flow, the higher profits to be received by the company due to the higher total cash flows from operating activities shows that the company is able to operate profitable, because of the company operating activities generate cash well so that will affect the profit. The value of cash flow from operating activities showed a high value, it can be said that the result of the revenue gains from the company greater than the burden of the company during the period. Cash flows operating activities recorded revenue and expenses arising from the main operations of the company so that the cash flow operating activities may affect the profit contained in the statement of income as an indicator of the income statement are income and expenses. The results of this study support other research Nuraina (2011), Yuliafitri (2011) operating cash flow has an influence on earnings. Operating activities are principal revenueproducing activities of the company (the principal revenue-producing activities), and other activities that are not investing activities and financing activities. Cash flow of investment to profit The results of statistical calculation provide the result that investment cash flow cannot predict earnings. Statistical test results no effect between investment cash flow to earnings. This is due to investment activities are the acquisition and disposal of long-term assets and other investments not included in cash equivalents. Furthermore, cash flow investment is the purchase and sale of financial instruments with the aim not to be traded. That is, not including the sale of the company's business segments is traded each period. So it has no effect on earnings. Investment activity is not a routine activity. The results of this study support the research conducted by Patmono (2004). Investment cash flow may indicate about the acquisition and disposition of assets of the company in which the fixed assets are supporting resources in getting company higher earnings. If the value of the cash flows from investing activities showed high value which can be said that the result of the acquisition of the fixed asset sales with higher value than the purchase of fixed assets. Financing cash flows to Earnings Statistical tests showed the results of financing cash flow affects earnings. It also provides results of the relationship between financing cash flow relationship and profits in which it has a positive effect. That is, that the higher total cash flow funding will increase profits. An increase in cash flow from financing activities will attract investors to buy the stocks and it can increase the company's stock price, which in turn also affects the profit. Thus, the higher total financing cash flows shows that a high proportion of ownership will have an impact on investor confidence and the effect on company profits. Conversely, the smaller the total financing cash flows shows the proportion of ownership is low, so it will have an impact
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on investor confidence and the effect on company profits. Heightened financing cash flows shows the company has a lot of action relating to the capital increase and the payment of longterm debt, so that the capital and liability picture will show a high proportion of ownership. The results of this study support the results of research conducted by Patmono (2004). Financing activities are activities that result in changes in the number and composition of capital and loan companies. Where in the financing activities, is the true information about some transactions such as the issuance of new shares, issuance of debt (bonds), dividend payments, withdrawal of shares and the payment of long-term debt. Issuance of new shares and the issuance of debt (bonds) which describes the composition of the company's capital occur. Yet, dividend payments, withdrawal of shares, and the payment of long-term debt companies describe loans. CONCLUSIONS It can be concluded that this study can predict the cash flow statement and earnings. Cash Flow Statement with the measurement of operating cash flow has a positive effect on earnings. It indicates the higher the total current year operating cash flow, the higher the profit is for the company because the higher total cash flows from operating activities also shows that the company can be profitable in operation because of its ability to get more revenue for paying all the liabilities they have in their operation. It can also create a stream of revenue inflows while the load will create cash flow. The presence of incoming and outgoing cash flow will affect corporate profits. However, investment cash flow has no effect on earnings. It is due to cash flow investment that includes the purchase and sale of financial instruments that are not traded goals. That is, not including the sale of the company's business segments is traded each period. Thus, it has no effect on earnings. In this case, operating activities are activities that are routine, while investment activity is not a routine activity. The relationship of financing cash flow has a positive effect on earnings. This means that the higher total cash flow funding will increase the profits to be received by the company. Due to the higher total financing cash flows shows that a high proportion of ownership that will have an impact on investor confidence and the effect on company profits. The increase of financing cash flows shows the company has a lot of action relating to the capital increase and the payment of long-term debt, so that the capital and liability picture will show that a high proportion of ownership. The sale of shares will create cash flow stream for the company, while the long-term payment obligations will create cash flow out of the company. ACKNOWLEDGMENT The researcher would like to express her thanks and appreciation to all parties related to the fulfillment of this research. Therefore, she feel indebted to all who had helped in gathering the data, those who also helped to the participants in getting the data from the go-public- companies. Due to their efforts and sincere involvement, the researcher could finish this research. REFERENCES Beattie, V., S. Brown, D. Ewers, B. John, S. Manson, D. Thomas and M. Turner (1994), ―Extraordinary Items and Income Smoothing: A Positive Accounting Approach‖.Journal of Business Finance and Accounting, Vol. 21, N.º 6 (September), pp. 791-811. Brigham, Eugene F and Joel F.Houston, 2006. Dasar-Dasar Manajemen Keuangan. alih bahasa Ali Akbar Yulianto, Buku satu, Edisi sepuluh, PT. Salemba Empat, Jakarta. Dwiati, Agustina Ratna (2008). Kemampuan Arus Kas, Laba, Dan Akrual Untuk Memprediksi Arus Kas Dan Laba Masa Depan. Journal Vol 5, No 1 (2014) Universitas Brawijaya.http://jamal.ub.ac.id/index.php/jamal. Diakses 19 Juli 2014.
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Febrianto, Rahmat & Erna Widiastuty. 2005. Tiga Angka Laba Akuntansi: Mana Yang Lebih Bermakna Bagi Investor?. Solo. Simposium Nasional Akuntansi VIII : 159-169. Financial Accounting Standard Board. 1978. Statemen Of Financial Accounting Concept No 1, FASB Publication. Financial Accounting Standard Board. 1980. Statemen Of Financial Accounting Concept No. 2 – Qualitative Characeristics Of Accounting Information. Connecticut: Fasb Publication. ________________________________,1987. Statement Of Financial Accounting Standart No. 95 Connecticut: FASB Publication. Francis, J. R., Nanda, and P. Olsson 2004. Costs of Equity and Earnings Attributes, The Accounting Review. 79: 967-1010. _________________________________. 2008. “Voluntary disclosure, earnings quality, and cost of capital”. Journal of Accounting Research 46 (1): 53–99. Harahap, Sofyan Syafri. 2008, Teori Akuntansi. Penerbit PT. Raja Grafindo Persada, Jakarta. Hirshleifer, D. 2001. Investor psychology and asset pricing. Journal of Finance 56 (4): 1533– 1596. Ikatan Akuntansi Indonesia. 2009, Standar Akuntansi Keuangan PSAK No. 2. Salemba Empat, Jakarta. -----------------------------------. 2009, Standar Akuntansi Keuangan PSAK No. 1. Salemba Empat, Jakarta. Kieso, Donald E., Jerry J. Weygandt, and Terry D. Warfield, 2002. Akuntansi Intermediete, Terjemahan Emil Salim, Jilid 1, Edisi Kesepuluh, Penerbit Erlangga, Jakarta. McNichols, M. 1989. “Evidence of informational asymmetries from management earnings forecasts and stock returns”. The Accounting Review 64 (1): 1–27. Nuraina Elva, 2011. Laba, Arus Kas Operasi dan Akrual Sebagai Penentu Laba Operasi Masa Depan. Jurnal Dinamika Manajemen.JDM Vol. 2, No. 1, 2011, pp: 62-69 (online) http://www.google.com . Diakses 19 Juli 2014. Patmono, Asih. (2004). Kemampuan Laporan Arus Kas Memprediksi Laba. Journal JAAI volume 11 no. 1, juni 2007: 21– 33. Universitas Sebelas Maret. (online)http://dglib.uns.ac.id. Diakses 18 Februari 2014. Sloan, R.G. 1996. “Do Stock Prices Fully Reflect Information in Accruals and Cash Flows about Future Earnings?” The Accounting Review 71. Journal. (onlie) http://www.google.com. Diakses 20 Februari 2014. Soemarso. 2004. Akuntansi Sebagai Pengantar : Salemba Empat. Jakarta. Spence, Michael. 1973. Job Market Signaling, The Quarterly Journal of Economics, Vol 97, No 3 (Agust.1973), pp. 355-374. Stice, Earl K., James D. Stice and K. Fred Skousen. 2004. Akuntansi Intermediate, Edisi Lima Belas, Buku 1, Alih Bahasa oleh Salemba Empat, Jakarta Sundaresh, R., Steve, R & Philip, S. 2008. The Financial Analyst ForecastingLiterature: A Taxonomy with Suggestions for Further Research. InternationalJournal of Forecasting. Vol. 24, pp: 34-75. Wardani, Utami Budi (2013). Perbandingan Model Agregat Dan Model Disagregat Arus Kas Aktivitas Operasi Untuk Memprediksi Laba Masa Depan. Journal Undip. http; //eprints.undip.ac.id/39401/1/WARDANI.pdf. Diakses 12 Mei 2014. Wulandari, Rahaju Mulyo (2005). Analisis Kemampuan Arus Kas Dalam Memprediksi Laba Perusahaan. Journal JAAI volume 15 no. 1, juni 2008: 34-36. Universitas Sebelas Maret. (online) http://dglib.uns.ac.id. Diakses 6April 2014. Yaniartha, p. D’yan. 2010. Kemampuan Prediksi Laba Dan Arus Kas Dalam Memprediksi Laba Dan Arus Kas Pada Masa Mendatang. Journal Akuntansi. Universitas Udayana. (online) http://www.google.com. Diakses 14 Maret 2014.
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Yuliafitri, Indri. 2011. Analisis Faktor-Faktoryang Mempengaruhi Laba Dan Arus Kas Masa Depan Pada Perusahaan Go Public.Jurnal Investasi. Vol 7 No. 1 Juni2011. Hal 14-30. Diakses 19 juli 2014.
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THE DEVELOPMENT OF FINAL EXAM REGISTRATION INFORMATION SYSTEM (SIPUAN) AS THE IDEA OF ENTREPRENEURIAL INFORMATION TECHNOLOGY 1
Mohammad Idhom, 2Ronggo Alit
1,2
1,2
Informatic Departmen Faculty Of Computer Science University Of Pembangunan Nasional “Veteran” Surabaya INDONESIA 1
Emails:
[email protected], 2
[email protected] ABSTRACT Institutions of higher education in particular have a responsibility in producing graduates who are qualified in the various fields of science. College doing curriculum development as the basis for the student/i in the educated, in a curriculum there are plans of study that will be evolved by the student/i. State where students will come/i undertake final project/Thesis that begins with the submission of the proposal for the appointment of the supervisor, then to carry out the test of the final project/Thesis to the examiners. By doing business in the field of ideas pengembangann TI in particular the development of Final Exam Registration Information System (SIPUAN) with a way to combine multiple components of information systems to build the basic idea of the IT business and meets the specific needs of customers is expected to enhance the potential of the IT product/service in the market and by understanding their needs, then it can fulfill value is customers and with it so will encourage them to continue to purchase products that have been produced. Keywords: Information Systems, Final Exam Registration, The Basic Idea Of The IT Business INTRODUCTION The development of information technology that rapidly affect many areas of both the world of business, services, education and more. No exception education especially higher education was one area that was heavily influenced by the development of information technology. Globalization demanding education colleges to be able to manage the information properly, so that the information needs of each stakeholder can be fulfilled quickly and precisely (Choldun, 2006). College of information technology do not develop properly will be increasingly left behind. Final project/Thesis is written reports the results of research conducted by the student with the guidance of a lecturer and maintained before the Board of examiners. Final project/Thesis is also used as one of the conditions for obtaining the degree of Bachelor. Faculty of computer science of the University of Pembangunan Nasional "Veteran" East Java in managing thesis still use the manual way, so will spend much time and effort. It can enlarge the opportunities of the occurrence of an error in the delivery of information, ultimately information becomes inaccurate. Application of oral exam registration information systems at the Faculty of computer science of
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the University of Pembangunan Nasional "Veteran" East Java will provide a solution so that the implementation of the new directives will be more service maximum. (Jogiyanto, 2005) in his book entitled information systems Design and Analysis suggests that information system is a system in an organization to meet the needs of daily transaction processing, supporting operations, managerial and kegiatanstrategi nature of an organization and provides a certain outside parties with reports – laporanyang is required. Things – it is possible as the answer to the problems occurred with regard to the registration of final exam. The system that already exists in the Department of computer science University of Pembangunan Nasional "Veteran" East Java specifically in Engineering Informatics Courses, can be developed and look for the flaws of the system that has been running sub, where the system is already at this time or called by Student Guidance information system (SIBIMA) as the answer to the problems occurred with regards to the final task of guidance and practice of Fieldwork , starting from the title selection, scheduling, Supervising Lecturer determination test, and jugapenentuan the schedule of activities in accordance with the guidance of Lecturers and students/i, from the existing system, then the system needs to be developed is how to make a system that can help in the oral exam registration can be named Final Exam Registration information system (SIPUAN). INFORMATION SYSTEMS The design of the system before the system developed for real, then the first rangangan created from the design of the system, namely the global picture of the system to be developed further. The purpose of the system design are generally gives an overview to the user about the system to be built. Components of the information system will be built, among others, are: a. Model sistem b. Input sistem c. Output sistem. d. Database. From most representations of the above components will not be able to give you details to the user about the system to be built. The methodology used to provide to the user the depiction, among others, data flow diagrams, design of interfaces, table structure, and table relationships.(Teguh Cahyono, 2013) (T. Cornford & M. Shaikh, 2013) Information systems can improve organizational management in operating and help ease the work. This is achieved by collecting, storing, and processing and sharing data and information. The statement pointed out that the study of the information system requires four different purposes but are interrelated, are as follows: 1. Computer-based digital technology, used to handle information. 2. The user becomes part of the information system. 3. Complete the tasks that are expected for the needs and specific requirements. 4. Build the system. There are two approaches in defining the system, namely the emphasis on procedure and emphasis on components or elements to it. Systems approach that put more emphasis on the procedure defines a system as follows: "a system is a network of procedures which are interconnected, gathered together to perform an activity or to complete a certain goal". A systems approach is the work of the procedure more emphasis the operation in the system. A system approach to a greater emphasis on elements or components defining a system as follows: "the system is a collection of elements that interact to accomplish a particular purpose". A systems approach is a set of elements or components or subsystems-subsystem definition is wider and more accepted because it is in fact a system composed of several subsitem or systemsystem parts. Components or subsystems in a system-subsystem cannot stand on its own,
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everything is interconnected and interacting to form a single entity so that the target system can be achieved. Information is data that is processed into a form that is more useful and more meaningful to who receives it, whereas the data is a source of information describing an event (the facts). Information system, according to Leitel and Davis in his book "Accounting Information System" defines that: "information system is a system in an organization that meet the needs of daily transaction processing, supporting the operation, activities and strategies of the managerial nature of an organization and provides a certain outside parties with the necessary reports". A common definition, information system is defined as a system in an organization who process data into a form that is more useful to achieve a goal. (Jogiyanto, 2005) Scott (1996) says that the system composed of the elements – elements such as input, processing, and output as shown in Figure 1. According to (Jogiyanto, 2005) in his book entitled information systems analysis and design explained that: "the system is the network of procedures which are interconnected, gathered together to do an activity to complete certain suatusasaran"
Figure 1. Block Of Information Systems (Scott, 1996) According to Kenneth c. Laudon and Jane p. Laudon (2008), the information system is a set of interconnected components, assembled (or get), process, store, and distribute information to support decision-making and supervision in an organization. Al Fatta (2007) suggests that the components that make up an information system consisting of: a. the hardware, namely hardware components to complement the activities incorporate the data, processing data, and output data. b. software, namely programs and instructions given to a computer. c. Database, i.e. a collection of data and information that is organized so that it is easily accessible sedemikaian users of information systems. d. telecommunications, namely communication system between users connecting with computer systems together into a network of effective work. e. men, the personnel of information systems, including admin, analysts, programmers and operators. In a study conducted by (William Kurniawan, Adian Fatchur Rochim, & r. Rizal Isnanto, 2011) in the era of information technology today, where all activities are performed quickly, easily, effectively and efficiently, so that the College should be able to provide a wide range of information relating to the study of the student body. One of the kinds of information is provide information about seminars and final assignment so that students can find out the title of the final project that already exists or can create new final assignment title. With this application it is expected a favorable information about the title of the final assignment which is beneficial for students who will craft a final project and College. THE CONCEPT OF DEVELOPMENT The concept of development of the IT business ideas by using the six components of the information technology and industrial classification. Six information technology component of the Study is to develop the basic idea of the six components of the IT business IT: hardware, people, data, network, software, and procedures.
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Figure 2. Six Components Of Information Technology (Sumber Anthony Kirby Garcia) (Wibisono, 2014) Hardware is any artifact in the form of information technology hardware that stores data. People are the ones who use the artifact information technology to solve their problems. People can be a collection of individuals working independently and may also be an individual in a group. The data is the basic format of all forms of information, whether structured or unstructured, stored in hardware. The data can be a bit of information, files or folders. Network is any hardware device that bridges the data transfer between the hardware. The software is any software or hardware that is running the network. While the procedure is any business process that runs in the top of the software. (Wibisono, 2014) UNDERSTANDING CUSTOMER VALUE According to b. Fieg, quoted by Scott Robinette and Claire Brand (2001:27), "Value is determined on the customer's terms in the context of his or her unique needs." According to this definition, each customer has its own terminology regarding a bid value, where the value can meet the specific needs of the customers. By understanding their needs, then the company can meet the value is customers and with it so will encourage them to continue to make purchases against the company's products. Kotler (2005:68), stating that "Customer value is the difference between the evaluation of the prospects for all benefits and all the costs of a particular bid and other alternatives that are well thought out." The definition indicates that Kotler disclosed customer value concerning the benefits and tradeoffs, where the customer will compare the earnings from benefits and sacrifices made. When the perceived benefits greater than the sacrifice then most likely he will choose the value of the offer, and so any contrast when the perceived benefits less of a sacrifice that is done then the customers will leave the offer of the company. RESEARCH METHODS As for the methodology used in the peneltian working on this research are: 1. A Survey Of The Field. At this stage to preserve a survey to get the data – data administration of partners who are willing to become a place of case study research and data mining. 2. Study of Literature At this stage the collected documents, references, books, Ebook from the internet, or other sources that are required to design, build, test, validate, and document applications. 3. Analysis and design of the application
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From the results of the study of leteratur and lapanganwill survey results be made public a description of system design, system architecture, as well as performed needs analysis system, additionally also done preliminary design applications to be created, so that will be generated and the interface design process that is ready to be implemented. 4. Development The Application. At this stage are the most numerous takes because models and design that have been made are implemented to build the application. Application development dilaksanankan collectively and then integrated gradually. 5. Test and evaluation application. At this stage, the application of which has been completed is going through some sekenario trials and trial results will be evaluated to determine whether the application Worth released or need dimaintenance more. 6. The Preparation Of A Book Report. At this stage is the last stage of research. Next drafted a report that can describe the whole process of research. From the preparation of the report is expected to make it easier for readers who want to refine and develop this application further in subsequent studies. DISCUSSION Flowchart SIPUAN SISTEM INFORMASI BIMBINGAN MAHASISWA TINGKAT AKHIR (SIBIMA V2.0) Dosen
Koordinator PKL/Skripsi
Koordinator Prodi
Login
start
Login
T
T
Benar
Memasukkan Data Master Mhs dan Dosen
Benar
Y
Y
Melihat Statistik Bimbingan
Menu Hak Akses Koordinator Prodi
Mengisi form apakah jumlah bimbingan sesuai atau tidak
Melihat Statistik Bimbingan Dosen
Mendaftarkan PKL dan Skripsi
Mendaftarkan Jadwal Ujian PKL dan Skripsi
Data Rekapitulasi Mahasiswa Hasil Konfirmasi Nilai Bimbingan PKL dan Skripsi
Konfirmasi Acc Nilai
Data Konfirmasi Dosen Pembimbing
ACC Nilai Update Data Terbaru Sesuai Tidak Sesuai
Tidak Sesuai
Proses Input Data Nilai PKL dan Skripsi
Sesuai
Pendaftaran Ujian Lisan
Figure 3. Flow SIPUAN On the context diagram Figure 3 above, explain that there are 3 users who are involved in the system, such as: Lecture At this lecturer, user can do see statistics guidance as well as being able to do the approval of ACC value.
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a. Progdi Coordinator This Progdi Coordinator in user can do see statistics guidance and could see the confirmation value Practice and thesis. b.PKL/Skripsi Coordinator This PKL/Skripsi Coordinator in user This, could do a master data input activities of students and professors, as well as be able to register the PKL/Thesis and exam schedules can register PKL/ Thesis. CONCLUSION With business in the field of ideas pengembangann TI with a way to combine multiple components of information systems to build the basic idea of the IT business can increase the potential of the IT products/services on the market. But there are some disadvantages of this model, namely the emergence of the need to train users of the product if the product/service that is generated is completely new. The weakness of the other if the product is really new is the vagueness of the market because of the ignorance of the market will be the IT business products/services such. REFRENCES Al Fatta, H. (2007). Analisis dan Perancangan Sistem Informasi untuk Keunggulan Organisasi Perusahaan dan Organisasi Modern. Ed 1. Yogyakarta: Penerbit ANDI Choldun, Muh. Ibnu.(2006). Perancangan Sistem Informasi Akademik dengan Mengimplementasikan ERP.Prosiding Konferensi Nasional Teknologi Informasi & Komunikasi untuk Indonesia ITB. Jogiyanto. (2005). Sistem teknologi informasi. Yogyakarta: Andi Yogyakarta. Laudon.Kenneth C. & Laudon, Jane P. (2008) Sistem Informasi Manajemen. Palgrave: Basingstoke. Rifki Kurniawan, Adian Fatchur Rochim, & R. Rizal Isnanto. (2011). Perancangan Sistem Informasi Seminar Dan Tugas Akhir Jurusan Teknik Elektro Universitas Diponegoro . Semarang: Universitas Diponegoro. Scott, George M. (1996). Principles of Management Information System. Cetakan Ketiga. Penerbit PT Raja Grafindo Persada. Jakarta. T. Cornford, & M. Shaikh. (2013). Introduction to information systems. London: University Of London. Teguh Cahyono. (2013). Perancangan Sistem Informasi Penjadwalan Seminar Ujian Akhir Dan Kerja Praktek ( Studi Kasus Prodi Teknik Informatika Jurusan Teknik Universitas Jenderal Soedirman ). Yogyakarta: Teknik Informatika Uad Yogyakarta. Wibisono, A. (2014). Mengembangkan Ide Kewirausahaan Teknologi Informasi Di Jurusan Sistem Informasi Its. Seminar Nasional Sistem Informasi Indonesia, (Pp. 1-5)
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THE MARKETING STRATEGY FOR THE GROWTH OF BEU PHOTOGRAPHY AND VIDEOGRAPHY USING 7P Rheza Fernando Wibisono, 2Charly Hongdiyanto♠
1
Ciputra University Surabaya INDONESIA 1 Email:
[email protected],
[email protected] ABSTRACT BeU Photography and Videography is a photography and videography business that provides services for pre-wedding, wedding, company profile, music video, and live event. The company is established by Rheza Fernando in 2012. The company is currently facing profit decline which is caused by a low market price in Surabaya and the business needs to renew the marketing strategy to increase the sale. From the two reasons stated before, the researcher is now focused to decide the marketing strategy using 7P for the business. The purpose of this research is to fully understand and acquire information to make a marketing strategy using 7P. The research uses qualitative method and in-depth interview & documentation as its data collection method. Research result as follows, deep understanding about 7P in service industry and decides what the marketing strategy for photography industry in East Java. Research result is 7P in photography industry is important except place component. And the marketing strategy to face price problem in East Java is written in this research. Keywords: Marketing Strategy, 7P, Photography and Videography, Surabaya, Indonesia
INTRODUCTION Growth of business in the service sector is increasing. As we can see, so many service businesses fill the activity of economy, hospitality, tourism, pleasure service business, including photography and videography business. The photography and videography business is growing rapidly in all forms such as pre-wedding, wedding, music videos, and profiles. In 2016, the number of weddings in Surabaya is almost up to 3,000. (BKKBN, 2016). Based on an interview, request for wedding photography and videography is in a high number. In 2014, the number of exhibition halls for wedding is almost 1,000 (Ayu, 2014). Data from BPS Indonesia said that in 2016, the percentage of service business in Indonesia is 14,71% (BPS, 2016). Even the percentage in creative economy, manufacture, and construction is lower than the percentage of service industry. The percentage of service in industry in 2016 is increasing 10% from 2015 (BPS, 2015). BeU Photography started to operate in 2012. In two years, BeU Photography and Videography operated and grew independently to become a new business. In 2014, the owner of BeU Photography and Videography named Rheza Fernando joined a workshop in Singapore held by D’zign for You which is one of the most popular photography and videography company in
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Singapore. Noticing that this thing will be opportunity to grow the company, the owner of BeU Photography and Videography made good impression to the CEO of D’zign for You. This became the reason that D’zign for You asked the CEO of BeU Photography and Videography to become the crew for D’zign for You. In November 2015, CEO of D’zign for You appointed the CEO of BeU Photography and Videography to become branch manager of D’zign for You in Indonesia. BeU Photography and Videography is a company in the middle up class market. It is important to know excellent strategy at facing the competitors in Indonesia. Marketing is one of the most important things in a strategy, so marketers should pay attention on the supporting components in marketing mix in 7P, which stands for place, price, people, process, physical evidence, product, and promotion. Marketing mix is a set of controllable marketing tools used by a company for creating a desired response in the targeted market. (Khan, 2014). BeU Photography and Videography’s experience, customers from Jakarta and Bali were willing to pay more than the customers from Surabaya, while the company’s main office in Indonesia is located in Surabaya. To collect more data about the problem, the researcher conducted an interview with couples who want to take the pre-wedding package and to the photographers. From the interview, we found out that people in Surabaya tend to give price to service products lower than the quality of the product. People in Surabaya tend to less appreciate products of service. And by showing the website and the portfolio, the participant rates the price for the product much cheaper than the standard price for BeU Photography and Videography. This means that the quality and the price are not adequate. With the problem found, the researcher formed a research with the title “THE MARKETING STRATEGY FOR THE GROWTH OF BEU PHOTOGRAPHY AND VIDEOGRAPHY USING 7P”. LITERATURE RIVIEW Marketing Marketing is a comprehensive concept that involves various marketing activities included in the marketing system. Marketing is one of the main activities carried out by the employer to maintain their life, to grow, and to gain profit. Marketing is a process that aims to satisfy the needs and desires of consumers. Marketing has been seen as an important element in establishing and building companies. With the business environment and the increasingly competitive nature of the market, it changed from a sales market into buyers in market. Marketing is not limited to the business world, because in fact every relationship between individuals and organizations, or between individual and individual that involve the exchange process, is a marketing activity (Kotler, 2012). Kevin Kane Keller said, marketing is about identifying and meeting human and social needs. One of the shortest good definitions of marketing is “meeting needs profitably.” (Kotler, 2012). According to Andrew Whalley, marketing is commonly misunderstood as an ostentatious term for advertising and promotion. In reality it is far more than that. This perception is not in many ways unreasonable, advertising and promotion are the major way in which most people are exposed to marketing. Andrew Whalley wrote that marketing has three levels. First, marketing is everything. Marketing is not a function anymore. It is a way of doing business. It is the process by which a company decides what it will sell, to whom, when & how and then does it. Then, the second level is marketing as strategy. The second layer is about segmenting the market, deciding which customers to target, and deciding what message you want the targets to associate with you, it is called positioning. The third level of marketing is about the day to day operational running of marketing. It encompasses the control of the marketing mix and the processes within a business that help create and deliver that company’s products and services to the customer (Whalley, 2012).
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Marketing Strategy 1. Product Product can be defined as to satisfied necessity and need, include physical goods, service good, idea, products, organization, and information. (Greg, Mark, 2011). 2. Place Ketler and Armstrong said that place is activities that companies produce products for target consumers (Kotler, Armstrong, 2012). 3. Price Price is everything that must be paid by consumer in exchange for products (Grewal, Levy, 2011). 4. Promotion Promotion is the design and dissemination of persuasive communication about a product to attract consumers (Tjiptono, 2015). 5. Process The process of service is the way in which the service is delivered to the end customer (Shah, 2012) 6. People People are becoming an important factor in the service industry because the people who activating interaction service processes (Shah, 2012) 7. Physical Evidence Oesman said, the physical evidence is an environment where the service is delivered and the place where companies and customers interact and physical components, performance and communication facilities (Oesman, 2010). RESEARCH METHODS Research Design The research is using the qualitative method to approach the survey. Qualitative research is especially effective in obtaining culturally specific information about the values, opinions, behaviors, and social contexts of particular populations. The strength of qualitative research is its ability to provide complex textual descriptions of how people experience a given research issue. It provides information about the human side of an issue (Edward, Holland, 2013). The main reason on why the researcher uses qualitative method is to obtain deeper and more details about the company reason problem. The problem is the product and the quality for photography in Surabaya is not worth the price. Research Object and Research Subjects Research subject is a single member of selected group of people, events, or things of things of interest that the research wishes to investigate (Sekaran, Uma, et al, 2013). Research object has particular variable to be learned and to get conclusions (Sugiyono, 2013). The subject in the study will be explained table 1. The subject is divided into three categories. First category will be the consumer candidates in Surabaya, the second category will be the photographers in Surabaya, and the third category will be the expert in marketing strategy. The criteria to choose the subjects will be explained in table 3.1. Criteria will be explained on each subject categories. Table 1 Subject Criteria Criteria Photographers - 5 years minimum in opening Photography Company. - Middle high level of economy. - Price range between Rp 10,000,000 – Rp 25,000,000.
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Candidate Consumer Marketing Expert
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Pre-wedding, wedding, and company profile photography and videography.
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Couple who are going to marry. Middle high level of economy. Expert in marketing. University Lecturer in marketing major Or has experience in marketing over 20 years and already has own company over 10 years.
Source: Processed Data Data Collection Method This research is using two data collection methods, which are face to face interview and documentation as secondary data. Face to face interview has a distinct advantage of enabling the researcher to establish rapport with potential participants and gain their cooperation. This interview yield highest response rates in survey research. They also allow the researcher to clarify ambiguous answer and when appropriate, seek follow up information. Disadvantages include impractical when large samples are involved, time consuming, expensive in terms of training the interviewer to minimize bias, and geographical limitations. In this research, the researcher would use interview as the primary data and documentation as the secondary data. This research is using semi structural interview. This type of interview has advantage because semi structural interview is recommended when the researcher has developed enough of an understanding of a setting and the topic of interest to have a clear agenda for the discussion. DATA ANALYSIS AND MARKETING STRATEGY DATA ANALYSIS 1. Product In the photography industry, product is important to focus on. Quality must be maintained to stay in premium product by selecting the customer segmentation. If photography company takes all segments in production, middle high customer would dismissive the premium product. Marketers or company also needs to know what the market needs and what the market wants. 2. Place In a photography industry or media art industry, place is not that important, because marketing tools for photography industry, is more important in social media and word by mouth. If Photography Company wants to expand their market, the company does not need to open marketing office to another city, but it is better to make relation or partnership with another photography company in another city or another country. Photography Company needs to come to “jemput bola”, it means that the company needs to actively come to the customer. 3. Price It is important to have research in the market before setting the price for the product. But the main problem to photography companies in East Java is the price in East Java which is too low for premium quality. One of the factors of this problem is customer in Surabaya tend to push the price. The customers in Surabaya want to have premium quality for the product but with cheap price. 4. Promotion Promotion is also important in photography industry. Physical promotion like exhibition is not efficient anymore. In photography industry, promotion by social media like Facebook,
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Youtube, Instragam, etc, are much more efficient and more low cost. Another promotion tools for photography industry is using word of mouth. 5. Process Every company needs to give the best service, both in process or after sale. Every company needs to predict who the customer is and what the customer want. After sale process is important. Good relation with customer after sale also can be the tools and good strategy for the promotion to the company. 6. People Companies should treat customers, employees, and all stakeholders fairly with high ethical and integrity norms. It is important to share the company vision and value to the employees to make them loyal to the company, and it is important to teach honesty to the employee. By giving the value and teaching the employee honesty, employees also give the company advantages in the process and the outcome. Employees can work with their heart and employees can make the name of the company become positive to the customer or to the customer candidate. 7. Physical Evidence Physical evidence is important for the customer candidate. One of the factors on why customers want to choose Photography Company is because of the company’s portfolio and the company’s track record. Excellent track record is important because by having good track record, the name of the company would be positive. Marketing Strategy 1. Product BeU Photography and Videography will maintain the product in premium quality. By being stable in premium quality, BeU Photography and Videography can maintain the segment in middle high and can maintain premium both in product and the name of the company. 2. Place BeU Photography and Videography will not concentrate to open or relocated the office, but instead make relation with another photography company in another city or another country. By having relation, the company can have advantages in marketing, sales, and physical evidence. 3. Price The strategy to give worthy price to the customer is, to make a good relationship with the customer first, tell them about the process to make good photography product, then tell them about the price. But if the customer cannot be affected by telling the process, photographers will have to give the worth quality according to the price. 4. Promotion One of the strategies for promotion, word of mouth for photography industry is having good relation to the customers in process and after sale. A good relationship will make the customers promote the company to their family or even their friends. 5. Process BeU Photography and Videography must put attention in process with the customer and after sale process. A good process in doing the project and after sale, the customer will appreciate what the company did for them and the customer can recommend the company to their friends or family. 6. People The researcher as the CEO of BeU Photography and Videography must give comfort work zone and work procedure to employees. In photography industry, employees are really
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important to maintain. Excellent employee’s skill determines excellent product. The company should teach the employees about the value of the company, the value of loyalty, and honesty. 7. Physical Evidence BeU Photography and Videography must be selective with customers and the product. By being selective, the company will have an excellent and premium portfolio. Perfection in processing until finishing should be done by the company. Being stable in making an excellent product will influence the decision from the customer. Table 2. Managerial Implication No. Before After 1 BeU Photo and Video sometimes The Company will be stable to do accepted production lower than the premium quality and selective the company standard. customer and the product. 2 The researcher as the CEO of BeU BeU Photography and Videography Photography and Videography does not need to relocate the would like to relocate the marketing department to another city, marketing department to another but make a relationship with another city because of pricing problem. photography company in another city. 3 The company is facing price BeU Photography and Videography problem. Consumer in East Java will not tell to the customer about the tend to price photography too low. price first. Instead, BeU Photography and Videography will tell about the value of the process and the premium quality photography. 4 BeU Photography and The company will use customers as Videography is concerned to do an unofficial sales marketing by promotions just in exhibition and making a good relation after sale. social media. 5 BeU Photography and The company will increase and Videography is always concerned maintain the value of the company by about giving best service in giving the customer the best service process. both in process and after sale process. 6 The company did not give the BeU Photography and Videography exact value and vision of the will not only hire the employee, but company. the company will also teach them value, vision, and honesty. 7 BeU Photography and The company will increase the Videography will be stable to quality of the portfolio and be more maintain good physical evidence selective in making the physical as the portfolio. evidence. Source: Reseacher Data CONCLUSION Conclusion Marketing strategy is important to run a business, in service, trading, or manufacture business. 7P which stands for product, place, price, promotion, process, people, and physical evidence, are important factors in marketing strategy. Each component of 7P is connected to each other and one component will support another component. If one of the components cannot be used to increase the sale, the companies will try to increase the sale by using other 7Ps’ component. But in photography or media art industry, the component
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that is important to be used in marketing strategy are product, price, promotion, process, people, and physical evidence. Place is not that important because in an industry like photography or media art, it is more efficient to use social media and word of mouth as the type for a company’s marketing. Unfortunately, the main problem for photographers in East Java is the low price for photography and videography. Customers in East Java tend to push the price lower. The customers want premium product with lower price. This problem makes photographers in East Java compete in price, setting aside the other components of 7P. Suggestion Having good relationship with customers and having an excellent product is really important in the photography industry. The strategy to give worth price to the customer is build relationship with the customer first, and then give the customer value of the product and the value of the process in making the product, then photographer will be able to tell the customer about the worth price for the product. To maintain continuous buying, photographers should build a good relationship with the customer after sale. By building good relationship with customer, photographers can use customers as their marketing or promotion, which is called word of mouth.Next researcher should focus on each single component from 7P to provide more marketing strategy in photography and media art industry. Research for marketing strategy from photographers in another city should be done to compare with the market for photography in East Java. Research Limitation The researcher only managed to conduct interview with photographers in East Java. It is also important to conduct interview with photographers from another city or country, so that the research and the problem can be comparable. REFERENCES Ayu, Riana Putri. (2014). Analisis Marketing Mix 7P Terhadap Keputusan Penggunaan Jasa Fotografi dan Sinematografi di CV. AKHMADMAXI. Journal. II-1 – II-5. Grewal, D. ; Levy, M. (2011). Marketing, 3rd edition. McGraw Hill. New York. Harrington, Robert J. ; Ottenbacher, Michael C. ; Fauser, Simon. (2017). Marketing Mix Dimensions among McDonald’s, KFC, Burger King, Subway, and Starbucks. International Journal. Emerald Publishing. 554 – 556. Kerin, Roger ; Hartley, Steven. (2010). Marketing Thirtheenth Edition. McGraw Hill. New York. 122. Kotler, Philip ; Keller, Kevin Lane. (2012). Marketing Management 14th edition. Pearson Education. 32 & 122. Londre, Larry Steven. (2017). Several Concepts, Terms and Useful Definitions Help Explain and Aid in the Understanding of Marketing and Related Activities, including Marketing Concepts, Marketing Objectives, Strategies and Tactics, Marketing Mix (4P’s), and the Nine P’s (9P’s) of Marketing. International Journal. Londre Marketing Consultant. 6 – 9. Noor, Agus Mentari. (2016). Pengaruh Bauran Pemasaran (7P) Terhadap Keputusan Konsumen untuk Menggunakan Jasa Hotel Grand Sawit di Samarinda. Jurnal. Universitas Mulawarman. 1032 – 1033. Ren, Haijuan. (2016). Research on Leisure and Fitness Business Marketing Structure. International Journal. Sias International University. 1137 Shah. (2012). The Extended Services Marketing Mix Used By Restaurant And Banking Industry, Review Of Literature. Volume 1 – 2.
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Suherly, H. ; Affif, Faisal ; Arief, Helmi ; Guterres, Alexandre Desousa. (2016). Marketing Performance as the Impact of Marketing Mix Strategy (7P) with Determination of Market Attraction and Company’s Resources. International Journal. United Kingdom. 573 – 574. Sugiyono. (2013). Metode Penelitian Pendidikan (Pendekatan Kuantitatif, Kualitatif, dan R&D). Bandung. Alfabeta. Sugiyono. (2014). Metode Penelitian Manajemen. Cetakan ketiga. Alfabeta. Bandung. Whalley, Andrew. (2012). Strategic Marketing 1st Edition. The eBook Company. 35 – 37.
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DETERMINING SOP IN BILLING SYSTEM AND RECEIVABLE PAYMENT BASED ON CUSTOMER RELATIONSHIP MANAGEMENT STRATEGY WITH QSPM METHOD FOR UD SEMANGAT BARU Sherly Wijaya, 2Tommy Christian Efrata♠
1
Ciputra University Surabaya INDONESIA Email :
[email protected] ABSTRACT Account receivable is a current asset that valuable in the company. Because of that, administration procedure needs to be done rightly so that it can be accountable. The problem is occurring due to no Standard Operating Procedure applied in the administration system at UD. Semangat Baru. That cause the account receivable system in the company is running ineffective which leads to lots of account receivable that has not paid yet even after the due date. The problem proposed as how to determine SOP in the billing system and receivable payment based on Customer Relationship Management Strategy with QSPM method at UD. Semangat Baru. Research method that applied is descriptive qualitative from the result of interview and data that needed. This research approached with the purpose to show the fact and give result that accountable. The sampling method used is non probabilistic with the purposive technique. This method is used because the population of the informant is limited to the purpose of this research. The result of this analysis is CRM that can be applied the best at UD. Semangat Baru is CRM Collaboration. This is showed by the result of the Quantitative Strategic Planning that the Total Attractiveness score of the CRM collaboration is 4,533 which more than the CRM analytics that get the Total Attractiveness score only 4,233. Keywords : Standard Operational Procedures, Customer Relationship Management, SWOT, Internal Factor Evaluation, External Factor Evaluation, Quantitative Strategic Planning Management.
INTRODUCTION Distributor is an individual or a company that distributes products (Shodiqin 2016). Distributor distributes their products start from small market to end user. Producer need distributor to help distribute their product that has been produced. Producer can save their sales cost because they do not need to deliver their products directly to consumer / end user. In this era, there are a lot of aggressive competitors that can run the business better which stated that the distributor need to improve their business performance to be able to survive in this industry. Distributor able to improve their business performance by having a good management operation and the condition
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that shows a company has a good management operation is a good Standard Operation Procedures (SOP) must be applied. It because the benefit of SOP is as a system or information that makes employee do their job according the rules that applied in the company and also will give the equal result if it is being done by the other employee. Based on Amere (2012) and Akyar (2012), a good SOP is not only listing what must being done as the activity of their work but also stated the employee qualification standard that required to do the job. UD Semangat Baru is a trading enterprise that distribute house ware product to outer island in Indonesia. UD Semangat Baru sell imported and local goods and the house ware that made form plastic, aluminum, stainless, glass, porcelain, melamine, and many others. UD Semangat Baru has over 100 suppliers of producer from high, middle, and low producer. Moreover, UD Semangat Baru also starting to develop their house ware own brand since the last 4 years. Designing SOP is important for UD Semangat Baru because since 20 years they started the business, there is no control over the internal management in the company. Similar thing with Akyar (2012) point of view that stated, SOP in companies nowadays are run not from standardized system management but only from habit. The habits which happened in the company that already run in a long run become the culture of the company that usually hard to change. However, changes still needed in order to get SOP that could become grading line to value the effectiveness and efficiency of the company performance. At the moment, UD Semangat Baru does not have written SOP. The employee only doing things that they usually done and there is no control to minimize the fraud that may occurs. In order to minimize the opportunity of fraud, this research is focusing to determine SOP in billing system and receivable payment which is part of administrative activity which has the highest risk of fraud because it is related with money and cash. SOP needed in UD Semangat Baru as a guide to perform internal controls on the company as to reduce the risk of fraud and congestion receivables that can harm the company. Account receivable is current asset that material when reviewed from the entire corporate wealth (Riwayati 2013). Therefore, proper administrative procedures must exist to be accountable in accordance with the actual conditions. In this research, SOP determine based on Customer Relationship Management (CRM). CRM need to be applied because there are problems that occur in the process of receivable collection. CRM also have an important role in today’s competitive business environment. This is because CRM will bring the ability to build, manage, and strengthen good relationship with potential customer and current customer as a strategy in managing business relationships. CRM is divided into 4 CRM strategies that each have key data that must be obtained as a reference analysis. The four existing CRM strategies are strategic CRM, operational CRM, analytical CRM, and collaboration CRM. Moreover, not all CRM type can be applied because each type has their own purpose and function. Between 4 CRM strategies, it will be discussed, sorted, and selected with the owner of UD Semangat Baru whichever CRM that is suitable for UD Semangat Baru according to the purpose and function of CRM strategies. The evaluation process in this research also using QSPM method to evaluate and compare the most suitable strategy to UD Semangat Baru’s billing system and receivable payment. QSPM is the most suitable method for evaluation process in choosing strategy rather than SWOT, SPACE, and BCG. This is because QSPM is a high level analysis tool for evaluating possible strategies by comparing alternative actions. There are several steps to complete QSPM method such as SWOT analysis, internal factors and external factors. These steps indicate that by using QSPM method, SWOT and SPACE method also being done here. The use of QSPM method requires intuitive judgment and good assumption. Weighting requires subjective decisions but the process must use objective information. Therefore the discussion between researcher as a strategic planner and owners of the company as a person who is very understanding about the company need to be done in order to the formulation of the right strategies.
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RESEARCH DESIGN
RESEARCH METHODS This research is using descriptive qualitative research. Qualitative research is a study that sees social reality as something that is complex, dynamic, holistic and meaningful (postpositive paradigm). The use of this method can make the data obtained becomes more complete, deeper, and credible in achieving research objectives. Moreover, Descriptive research is a study conducted to find out independent variables that produce descriptive data in the form of written or spoken and observable behavior of the subject itself (Djaelani 2013). Thus it can be said that qualitative descriptive research is a method that describes the research procedures that use
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descriptive data in the form of written and oral words from people who can observed. In qualitative descriptive research will be collected the result of interviews in the form of words that produce information and data required. This research approach is used with the aim to reveal facts and circumstances that occur and produce data as it is and can be justified. The benefit of using descriptive qualitative methods in this study is to get depth information about the current state of UD Semangat Baru and to get an overview of the steps of making the SOP as well as the correct billing system and receivable payment. Data Collection The interviews conducted in Surabaya are within the period of July to August 2016. Interviews were conducted by using digital voice recorded. There are 3 participants that involved in these interviews. First interview is from the owner of UD Semangat Baru who knows the ins and outs of his business. Second informant is from comparison company who is the owner of PT Sumber Untung and the third informant is from the project development manager of PT Jatim Petroleum Transport. The question asked to the informant from comparison company and the owner were different. Informant form the comparison company were asked about knowledge and thought about SOP and what they think about CRM in receivable payment process. However, the owner of UD Semangat Baru was asked about the strength, weakness, opportunities, and threat about her business. Moreover, discussion is conducted with the owner of UD Semangat Baru to do weighting for IFE and EFE so that the researcher able to process the data and put all the identification from IFE and EFE to the QSPM. Data analysis In this research there are 6 steps to do to be able to analyze the data before making the SOP. After the interviewed, firstly SWOT need to be done to be able to identify specific the internal factors and external factors from UD Semangat Baru business. Secondly, IFE (Internal Factor Evaluation) matrix needs to be done to weight the strengths and the weaknesses that exist in the company. Thirdly, EFE (External Factor Evaluation) Matrix needed to be able to identify and weight the opportunities and threats that exist in the company. Fourthly, CRM analysis needed to identify the suitable CRM that can be implemented in UD Semangat Baru. Then, QSPM needed as the analysis method that weighting the objective strategy decisions that suit in UD Semangat Baru. Moreover, analyze the integration of the result of the chosen CRM with the SOP in billing system and receivable payment in UD Semangat Baru.
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RESULTS SWOT
IFE Matrix Internal Factor Evaluation Matrix can be done after knowing the internal factors of the company. Weighting process, rating, and scoring are the result of discussion between the researcher and the owner of UD Semangat Baru. IFE calculated by comparing one factor with another. When considered more important, score 3 is given. When considered important, score 2 is given. Then, when it is considered less important, score 1 is given.
From the result of weight processing and rating, then the score can be calculated. The result of internal factor can be seen in the table below
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To assess the level of influence on the billing ang payment system. The rating level is rated 1 to 4. The value 1 indicate major weakness, value 2 indicate minor weakness, value 3 indicate minor strenght, and value 4 indicate major strenght. The score of IFE matrix on UD Semangat Baru is 2,578 which indicate that UD Semangat Baru is strong enough internally. However, this value indicate that UD Semangat Baru need to improve to develop internal strategic position. EFE Matrix External Factor Evaluation Matrix can be done after knowing the external factors of the company. Weighting process, rating, and scoring are the result of discussion between the researcher and the owner of UD Semangat Baru. EFE calculated by comparing one factor with another. When considered more important, score 3 is given. When considered important, score 2 is given. Then, when it is considered less important, score 1 is given.
From the result of weight processing and rating, then the score can be calculated. The result of internal factor can be seen in the table below
To assess the level of influence on the billing ang payment system. The rating level is rated 1 to 4. The value 1 indicate firm response to extrenal factor is superior, value 2 indicate firm respone
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is above the average, value 3 indicate the avegare respons, value 4 indicate bad response. The score of EFE matrix on UD Semangat Baru is 2,522 which indicate that UD Semangat Baru has a good response to the opportunities and threats that exist. Same as internal strategy, the position of extrenal strategy also need to be improved. Customer Relationship Management Researcher and informan was discussing about the 4 types of CRM and taking consideration about which CRM that suitable to be applied to UD Semangat Baru. Based on the funtion and purpose of each CRM, researcher and informant decided that CRM analytical and CRM collaboration is suit best in UD Semangat Baru. QSPM QSPM matrix analysis is used to select the strategy to be used based on alternatives of existing strategies. Alternative selection based on the views of researcher and the results of interviews and discussion with the owner of UD Semangat Baru. Alternative strategies selected, grouped into 2 group of analytical CRM dan CRM collaboration.
Internal and external factors that give effect and attractiveness are given score 1 (not interesting) to score 4 (very interesting). Information data in QSPM is directly from IFE and EFE matrix. QSPM analysis result conducted through discussion between researcher and owner of UD Semangat Baru by determining the value of Attrectiveness Scores (AS) is shown in table below. It can be seen that CRM collaboration has total attractiveness score 4,533 and CRM analytical with the amount of total attractiveness score 4,233. From this data it can be concluded that CRM collaboration is more attractive to internal factors and external factors in UD Semangat Baru compared to analytical CRM. Criterias CRM collabotaion based on Buttle (2015) are • Service application such as emails, discussion forums, e-communities, and else to facilitate interaction between customers and companies.
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•
Facilitates the interaction with customers through all channel such as letters, faxes, phone, web, and email. • Intergrate the data so that the company can serve and facilitate the customer better. The most important is 2 key criteria that need to be applied in CRM collaboration are customer get ease in accessing information about the company and maintain customer by listening and trying to meet the customers needs and wants.
CONCLUSION This reseach explains the process in determination Standard Operating Procedure of billing system and receivable payment based on CRM with QSPM method at UD Semangat Baru. First, the researcher must analyze the current state of the company. In this study, the condition of the company is assessed through a SWOT analysis to determine the strenght, weaknesses, oportunities, and threats that occur in the company. Then, IFE and EFE matrix is done to get the result of weight assessment to know the position to internal and external factor of company. After that, the discussion to analyse the function of each CRM that suit to be applied in UD Semangat Baru. Lastly, QSPM need to be done by giving attractiveness value on every aspect of IFE matrix and EFE matrix multipied by attractiveness value rating to get total attractiveness value. The sum of all total attractiveness value between the chosen CRM strategy determines the most attractive strategy to implement in UD Semangat Baru. From the process of determining CRM strategy, chosen CRM element need to be applied in billing and payment system. Decision making process has been done in this research. The decision making needs to pay attention to the good and the bad from internal and external aspect through Quantitavive Strategic Planning Matrix. With the decision making process that has been done, the value of learning to desicion making is to consider the good and the bad so that the decision can be a wise decision. Moreover, anticipate strategy can be prepared due to the weakness and threat could be harm the company. REFERENCES Akyar, I. (2012) Standard Operating Procedures (What are They Good For?). USA: Intech. Amere, G. (2012) ‘Reviewing The Value of a Standard Operating Procedure’, Ethiop Journal of Health Science, XX (3), pp.205-208. Badan Pusat Statistik. (2016).’Jumlah Rumah Tangga ,2000-2016’. http://www.bps.go.id/linkTableDinamis/view/id/851 Budihardjo, M. (2014) Panduan Praktis Menyusun SOP. Jakarta: Raih Asa Sukses. Buttle, F & Maklan, S. (2015) Customer Relationship Management : Concepts and Technologies. London & Newyork: Routledge. Candra, S & Linda. (2014) ‘QSPM and 7C’s Strategy for e-SCM Implementation Strategy (Case Study: XYZ Plastic Corporation)’, International Journal of Multimedia and Ubiquitous Engeneering, IX, (1), pp.11-16. Creswell, J, W. (2007) Qualitative Inquiry and Research Design. USA: Sage Publications, Inc. David, F,R (2011) Strategic Management: Concept and Cases’ South California: Prentice Hall Pearson, pp.80-192. David, M, E., David, F, R., and David, F,R. (2016) ‘The Quantitative Strategic Planning Matrix: A New Marketing Tool’, Journal of Strategic Marketing, pp. 1-10. Djaelani, A.R. (2013) ‘Teknik Pengumpulan Data Dalam Penelitian Kualitatif’, Jurnal Ilmiah, XX (1), pp. 83. Gupta, M., Shri, C., and Agrawal, A. (2015) ‘Strategy Formulation for Performance Improvement of Indian Corrugated Industry: An Application of SWOT Analysis adn QSPM Matrix’, Journal of Applied Packaging Research,VII, (3), pp. 60-73.
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Hajikhani, A & Jafari, H, R. (2013) ‘Developing a Mix Method of SWOT, BSC & QFD toward Strategic Planning’. Interdisciplinary Journal of Contemporary Research in Business, V (1), pp. 481-483. Medan Bisnis. (2016) Harian Medan Bisnis. Permintaan Peralatan Rumah Tangga Tinggi. http://www.medanbisnisdaily.com/news/read/2013/08/29/47598/permintaan-peralatanrumah-tangga-tinggi/#.VxsfekugHx4 Moleong, L,J. (2014) Metode Penelitian Kualitatif. Edidi revisi. Bandung: Remaja Rosdakarya. Mulyadi. (2016) Sistem Akuntansi. Edisi ke-4. Yogyakarta: Salemba Empat. Osita, I, C.,Onyebuchi, I, R,.and Justina, N. (2014) ‘Organisation’s Stability and Productivity: The Role of SWOT Analysis an Acronym for Strenght, Weakness, Opportunities, and Threat’. International Journal of Innovative and Applied Research,II (9), pp. 25-28. Puspitasari, N, B., Rumita, R., dan Pratama, G, Y. (2013) ‘Pemilihan Strategi Bisnis dengan Menggunakan QSPM (Quantitative Strategic Planning Matrix) dan Model MAUT (Multi Attribute Utility Theory) (Studi Kasus Pada Sentra Industri Gerabah Kasongan, Bantul, Yogyakarta), Jurnal Teknik Industri. VIII. (3). pp. 170-180. Ragin, C,C. (2014) The Comparative Method: Moving Beyond Qualitative and Quantitative Strategies. California: UC Press. Riwayati, S. (2013) ‘Analisis Pengendalian Piutang Trehadap Resiko Piutang Tak Tertagih Pada PT XYZ, Jurnal Akuntansi. V. (2). pp. 152-163. Setianingrum, A & Ong, J, O. (2013) ‘Selecting Alternative Strategy Using Quantitatie Strategic Planning Matrix (QSPM), International Journal of Engineering and Technology. pp. 1-8. Shodiqin, A. (2016). ‘Pengertian, Fungsi, Tugas dan Contoh Distribusi (Distributor) Langsung dan Tidak Langsung’. Available at: http://Ilmuekonomi.net (Accessed: 26 September 2016). Soemohadiwidjojo, A, T. (2014) Mudah Menyusun SOP. Jakarta: Penebar Plus. Sugiyono. (2014) Memahami Penelitian Kualitatif. Bandung: Alfabeta. Tesch, R. (2013) Qualitative Research: Analysis Types and Software. USA: Routledge. Widiasmara, A. (2014). ‘Analisis Pengendalian Intern Piutang Usaha Untuk Meminimalkan Piutang Tak Tertagih (Bad Debt) Pada PT. Wahana Ottomitra Multiartha, Tbk Cabang Madiun. Yin, R, K. (2014) Case Study Research: Design and Methods. USA: SAGE Publications, Inc.
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DEVELOPING INFORMATION RESEARCH SYSTEM AND COMMUNITY SERVICE (SIRIP) USING LEAN STARTUP APPROACHMENT 1
1,2
Sugiarto, 2Chrystia Aji Putra
Universitas Pembangunan Nasional “Veteran” Jawa Timur
INDONESIA Emails:
[email protected], 2
[email protected] ABSTRACT Information System Research and Community Service (SIRIP) is a solution system for all universities in order to support their Tridharma Perguruan Tinggi at point B and C, which are each lecturer are obliged to conduct research and community services (litabmas) each year. Development of this SIRIP program is expected to grow outside UPN Veteran Jatim institution. Because at the Research Institution and Community Service of UPN Veteran Jatim (LPPM), the program has been applied, which creates maximum result and helps LPPM officer to conduct data entry and monitoring of Litabmas activities. Using Lean Startup Aproachment, it is expected that this SIRIP can be a Pioner Startup on SIMLITABMAS field of study by Instituti Internal version. So that university will no longer have difficulties to report to the central about their proposed research data and community service that has been conducted by the internal campus. Keyword: Sistem Informasi, Lean Startup, UPN Veteran Jatim. INTRODUCTION The university’s assignment is to facilitate and accommodate all activities of Tridharma Perguruan Tinggi which is held both by lecturer and students. Universitas Pembangunan Nasional “Veteran” Jawa Timur is a university which has an institution that accommodates two of three Tridharma Perguruan Tinggai activities. It is LPPM (Institution of Research and Community Service). The activities that are hosted by LPPM are research and community service. Some activities of Tridharma Perguruan Tinggi are educational and teaching activities, research, and community service. Every academic member within university’s scope is obliged to conduct Tridharma Perguruan Tinggi. Academic member referred to are Lecturer and Student. Each lecturer are obliged to conduct TridharmaPerguruan Tinggi by doing their obligation as Lecturers. Each student are obliged to conduct TridharmaPerguruan Tinggi by doing their obligation as Student through their education. LPPM is an institution which holds the mandate to accommodate research activity and community service within Universitas Pembangunan Nasional “Veteran” Jawa Timur. In order to hold the mandate well, the research and community service within the collage environment are accommodated by a system which arrange a groove and display information report which is wanted by its user. One of activities management standard to be achieved is Process Standard, which is all activities must be planned, conducted, controlled and improved according to a sustainable research system quality improvement.
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Basically Information Research System and Community Service is used so it can facilitate its user, which are Lecturer, Students, Research Reviewer and other parties. Other process that can be conducted are monitoring and reporting implemented activities. This system is expected to become media for all academic member in doing their research and community service. This information systems is already exists and applied in LPPM UPN Veteran Jawa Timur, so the process of Tridharma Perguruan Tinggi and students community service (KKN) will be done easier and documented well. The problem faced by the university or other college is similar, that is why Information Research Systems and Community Service (SIRIP) fit perfectly to assist the specific chronology problem especially at private collage. Marketing and developing SIRIP require certain pattern to develop its computer science and marketing management aspects to several institutions. In order to be able selling and developing this SIRIP application writer tries to lift it up as stratup business. The problem need to be avoided is stratup tend to have difficulties to gain user after creating a products that have been made. Because they do not conduct customer development study to raise market acceptance before produce the product. Then failure happens because there is no user using the product or want to pay for them, eventually company will spend a large number of money and a long time for nothing. A product can be called a success if it is needed by user and able to solve their problems. In startup world there is a term “get out of the building”, popularized by Steve Blank which means an entrepreneur can not build a product isolated from their market. By using Lean Stratup Approchment it is expected to ease development and marketing this SIRIP application. Concept of Lean Startup is risk minimalize methods in building business, especially by relying on iteration (repetation steps) from product to market to gain good quality feedback as soon as possible and frequently form the market. Key principle of Lean Startup is to reduce waste. Lean Startup process reduces waste by increasing contact frequency with customer, so that testing can be done and incorrect market assumption can be avoided early. Using this Lean Startup concept it is expected that SIRIP can grow and help more institution outside UPN Veteran Jawa Timur. INFORMATION SYSTEM Information is data that is processed into more valuable and meaning for its recipients, while data is source of information which describe an scene (group of facts). Information system, according to Leitel and Davis on their book “Accounting Information System” define it as “Information System is a system within an organization which unites daily transaction management needs, backs up operational, spatially managerial, and strategic activities of an organization and provides necessary reports or other outer parties”. In common definition, information system is a system within an organization which process data into more useful form to achieve a purpose (Jogiyanto,2005) This system is consists of several element such as process and output, as seen as Picture 1 (Scott,1996). According to (Jogiyanto,2005) in his book named Analysis and Design of Information System, it is explained that : “System is a network of interrelated procedures, gather together to conduct an activity to fulfill a certain goal”.
Figure 1. Research Design.
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LEAN STARTUP According to Eric Ries, book writer of The Lean Startup. It defines Startup as “a startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty. startups are designed for the situations that cannot be modeled, are not clear-cut, and where the risk is not necessarily large - it's just not yet know”. According to Steve Blank, academics and entrepreneur on Silicon Valley defines Stratup as “an organization formed to search for a repeatable and scalable business model ”. According to Paul Graham, founder of one of the best startup accelerator in the world, defines Startup as “A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit." The only essential thing is growth. Everything else we associate with startups follows from growth”. From definitions above it can be concluded that Startup is a new company that is designed to grow fast. Lean Startup will teach differences between activities that give added value or “junk”, and shows how to create a product. Surely Lean Startup takes more on science and entrepreneurship context than manufacturing system. Lean startup use progress control unit known as validated learning. Customer feedback is used to move every iterations possible to evolve quicker than traditional way.
Figure 2. The Learn Startup Process From Picture 2 above, it can be explained that Lean Startup is started with an idea that can be developed into community solution form, then developing that form with information technology approach in form of information system. Within that creating information system process there are several codes must be written and concluded to conduct measure process to evaluate the solution of that information system. When a system is ready to use, then back up data can be inserted to completing and testing the system. Last step is to test and market out the system using Learn approachment, which will produce a feedback from user outside the location where it is produced. CUSTOMER DEVELOPMENT Steve Blank was the first to introduce Customer Development concept in a book called, “The Four Steps to the Epiphany”. Customer Development is questioning your core business assumption. Customer Development is a four step workframe to find and validate that you have
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identified market for your product, build a right feature product to solve customer need, test the right method to achieve and converse customer, and using the right resource to enlarge business scale.
Figure 3. Customer Development Model There are 4 steps mapping problems, hypothesis to solve problems, and how startup use test of the problem solving. Most of the test are done manually with a few or even no touch of any information technology. 1. Describing phenomenon or problems which startup faced on the market . For example. An university has several potential lecturer to conduct research within internal community, but there are obstacles in managing entry data from all departments or study programme. 2. Formulating causal hypothesis to explain problem statement. Human resources at institution which hold research is still less or less effective work while correcting data from writer. 3. Explaining hypothesis to help solving problems and predicting its implemented result with new approachment. Mapping all fields available at the university is necessary in order to coding on file collecting. 4. Measuring predicted performance based on experimental test. Opening new registration using the same model and scheme but different on file collecting process using labeling on each available documents. Startup then can change hypothesis and start over again. Through this repeating process (iterative), slowly your new company can start to define what technology feature can be build to solve problems. From the explanation above it is obvious that there is not any kind of technology used in problem solving process. Startup can use any available tools (such as Facebook/Twitter) to test its concept and gain feedback/market validation soon. Beside, it is very important or startup to gain feedback rom market or real customer who is actually paying the startup to solve their problems. In above example, we will ask startup to collect hypothesis as mentioned above to know how many customer appreciate your services. This hypothesis is a base for business model, if this kind of approachment model have not reach maximum result, then it can be linked by making a supporting information system or existing problems. Customer Development is not a once done process, startup team must be involved continuously as long as it lived. Because they fix their understanding about customer, their problem, motivation and budget, etc. DISCUSSION 1. Data Flow Diagram SIRIP Using this SIRIP structural approachment it will make a design analysis with Data Flow Diagram (DFD) in several level, such as :
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Figure 4. Context Diagram SIRIP On diagram context Picture 3 above, it explain that there are 6 users involved on this system, they are:
c. Officer The task of this Officer user is as administrator of this information system, where all master data are processed and officer registration can have full access. This officer can conduct distribution of student community service (KKN) and plotting research reviewers’ names and community service to assess lecturer proposal which have entered SIRIP. d.Lecturer As this Lecturer user, it can conduct research and community service proposal, and also see update information linked to Research and Community Service (Litabmas). When a lecturer have entered their independent research proposal, then after login this lecturer can also see whether their proposal status is accepted or not. e. Student As this Student user, it can conduct registration and enter proposal for Student Community Service (KKN), also apply their KKN activities proposal. After performing KKN registration, the student can see their groups data, location and supervisor, so that he/she is no longer need to come to the secretary of LPPM UPN “Veteran” Jatim to ask about the matter. f. Supervisor Lecturer (DPL) As DPL User, it can perform to seek information linked to KKN, DPL is a lecturer who is plotted by LPPM officer to conduct their task as DPL on KKN location as specified. g. Reviewer As Reviewer User, it can do assessment on research proposal and community service. This Reviewer is a lecturer who has been plotted by LPPM officer and approved by its superior. h.Head of LPPM
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As Head of LPPM User, it can only see all report that has been conduct by the ongoing system. So that this Head of LPPM can see this report up to date. 2. SIRIP BUSINESS MODEL CANVAS Business Model Canvas is popularized by Alexander Osterwalder based on his book named Business Model Generation. On Business Model Canvas, there are nine which described main elements of each business. Those nine elements are : a. Problem & Existing Alternative Startup It must identify three main problems which will be solved. Startup also has to acknowledge what kind of effort other people do to solve similar problems. b. Customer Segment & Early Adopter Startup This model writes on who are market target of the business initiated at. From that determined market target which ones are considered early adopter. c. Value Proposition, This model must be able to writes on what makes them different from others (differentiation). What makes them stand out and what first problems will be solved and for whom that solution is for. d. Solution, This model consists at least three features of the product based on problems that want to be solved. e. Customer Relationship This model contains of what substance belongs to this startup but no other startup has. f. Revenue Stream, This model contains of how this startup works to earn money and grows. g. Cost Structure This model must know how much expenditure that is going to happen, not in five years, but in each month. h. Key Resource, This model contains of activities on your measureable startup’s performance. i. Channel, Product marketing channel of the startup, such as through SEO, Blogs, Website, Facebook Ads, printed ads, events, words of mouth, partnerships and friends. Here is picture of Canvas Business Model of SIRIP
Figure 5. Canvas Business SIRIP
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CONCLUSION Lean Startup can help all process needed to develop SIRIP outside Institution of UPN Veteran Jatim. Using this canvas business, in the future SIRIP will have broader view for development model on information system or touch of technology on information. So that the university using this SIRIP will always gain newest information and update on bug which is in this Information System. REFERENCES Cooper, Brant, Vlaskovits, Patrick. The Entrepreneur’s Guide to Customer Development: A cheat sheet to The Four Steps to the Epiphany. (P. 17). Eric Ries. 2011. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. (P. 18). Steve Blank and Bob Dorf. The Startup Owner's Manual: The Step-By-Step Guide for Building a Great Company. Suhendri. 2014. Membangun Bisnis Startup Menggunakan Metode Lean Startup. Binus University. Jakarta Tritoasmoro Iwut Iwan. 2016. Adaptasi Implementasi Lean Startup untuk Meningkatkan Kesuksesan Kewirausahaan Akademik. Proseding Universitas Malang, Vol. 1, (Hal. 290297). Rianto, Eru Puspita, S.Kom,M.Kom, Wiratmoko Yuwono,ST “Sistem Informasi Inventarisasi Alat / Barang Di Smkn 1 Jenangan Ponorogo Berbasis Web” 2011, Mahatma Rein. 2013. Mempelajari konsep Lean Startup. Diambil dari : https://startupbisnis.com/mempelajari-konsep-lean-startup-customer-development-script/ (diambil pada 22 Juni 2017) Next Dev. 2016. Mengenal Lean Canvas, Model Bisnis Canvas. Diambil dari : http://thenextdev.id/new/update/index.php/2016/03/26/mengenal-lean-canvas-modelbisnis-untuk-startup/ (diambil pada 22 Juni 2017)
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PENERAPAN STRATEGI AIDA BERBASIS ONLINE TERHADAP PENJUALAN PRODUK CRISPYMUNCH Lavinia Nova Lukito, 2Trianggoro Wiradinata♠
1
Ciputra University Surabaya INDONESIA E-mail:
[email protected] &
[email protected] ABSTRACT This research aims to implement online-based AIDA strategy on Crispymunch selling. Crispymunch is a food and beverage company which especially produces cassava crispy snack which is different from others: premium quality, unique variety of taste, and interesting concept and brand. However,in this startup phase,some problems are still faced by Crispymunch if it is sold offline because it still does not have good brand-awareness or its product is still not known yet by society and its package is less interesting. But as time goes by,Crispymunch attempts to market its product via online on Bukalapak,Tokopedia,Instagram, also Line and Whatsapp for personal contact. After online selling, the sales increasing because customers often use social media, easy to compare product, can be done everytime and everywhere. Based on fact and phenomenon of selling in a company, the evaluation and the implementation of AIDA strategy should be done to know everything that influences the processes passed by customers on online purchasing and implement it on Crispymunch selling. AIDA Theory is a phase to know the process of how a customer eventually accepts a promotion on media, thus AIDA theory can be used to help finding the factors that influencing promotion processes on media used by a company, and implement its result to increase the product purchasing intention. This research uses theoretical framework related to AIDA theory, information from previous researches, and information of Crispymunch customer to-be, marketing expert, and foodblogger. This research uses qualitative method using semi-structurized interview as the method of data collection. On the other hand, for testing the validity and reliability of research result, this research utilizes source triangulation method. Data obtained from interview are reduced and analyzed to implement AIDA Strategy which suits the targeted market. The result of this research is the plan of AIDA strategy implementation which suits Crispymunch selling. Keywords: AIDA, food and beverage, marketing strategy, online business INTRODUCTION Indonesia is one of developing countries in Southeast Asia which ranks 4th nation with the largest population (BPS, 2015). In Indonesia, Small and Medium Enterprises (SME) has an important role for national economic development. Each year, Indonesian SME statistics is always increasing so that it could be a chance of business market target. This could be seen in Figure 1. Growth and competition of food industries is also increasing, as
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could be seen in Figure 2. Technology had developed to become more sophisticated, that lead to the ease of purchase transactions through online shops (Mulya, 2011: 14). Online marketing and purchasing are now having a great potential, because Indonesian internet user is always increasing and online shopping had become a habit. This can ease the promotion and distribution network. This phenomenonis even utilized by some famous brands for their marketing and sales through social media such as facebook, instagram, website, twitter, blog, and blackberry messenger’s mobile advertising (Handayani, 2010: 34). According to Rico (2014), instagram has 150 million active users each month. Every day, there are 16 billion of shared photos and 1,2 billion of liked photos. This unpaid media is of course very useful and potential to promote and sell products. Crispymunch is a starter company of snack industries in Surabaya which sells opak or cassava chips. In order to achieve its premium class target, the value offered by Crispymunch is not only of product quality but also new and interesting flavor variants. There area lot offlavour variants, such as original, balado, BBQ, roasted rib, roasted corn, cheese, and seaweed. Crispymunch is marketted through the internet, especially in bukalapak and tokopedia buying and selling forum, instagram account, Line, and WhatsApp. The researcher had seen the increase of Crispymunch’s sale through online marketing. Because of that, the researcher aimed to understand online purchase intention and the effectiveness of online promotion. The researcher had done pre-survey on ten customers who had bought Crispymuch’s products before. It was found that online promotion media is more effective than the offline one. According to the customer, the most interesting media used is instagram. There are some factors that encourage the customer to buy the product through online media. They can purchase the product anytime, and can make comparisons before purchasing. AIDA theory studies customer’s series of process in buying a product. It begins with attention phase, then interest phase, desire phase, and the last is action phase in which the customer make a decision (Miles, 2014: 146). In order to test the hypothesis arose from pre survey results, the researcher intended to do a research titled “The Implementation of Online-Based AIDA Strategy on Crispymunch’s Product Sales”. LITERATURE RIVIEW Online Purchase Intention According to Delafrooz et al. (2011: 2839), online purchase intention is the strength of a customer’s intentions to perform a specified purchasing behavior via internet. This statement shows that online purchase intention is the strength and tendency of purchase behavior through the internet. According to Kotler and Keller (2012: 237), there are some basic concepts of alternative evaluation that underlies the customer’s purchase intention, such as: a.The customer tries to fulfill his needs b. The customer seeks for a particular benefit or solution from the product c.The customer views each product as a group of attribute with different abilities in giving benefit to satisfy the need. Online Marketing Strategy through Instagram There are some ways to plan a marketing strategy through social media according to Garst (2015: 28-31), such as: (1) choosing a suitable social media with the market target; (2) using the social media collection as platform; (3) planning a content making; (4) planning content promotion. According to Zimmerman (2015: 148-151) strategies of using social media especially instagram as marketing media are:
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a.Sharing company’s internal stories such as daily activities, events, and highlighting the customer or staffs, in order to increase customer’s trust. b. Using hash tags to reach and join with the followers, the potential customers, and market of industry. c.Implementing “Call to Action” (CTA) in every post, attracting the customers to join with various events. d. Tag or mention other instagram users to help the message’s dissemination. e.Endorsement or endorser’s support such as celebrities or famous person to increase the brand awareness and achieve the product’s market target. Promotion through Online Media Promotion is an incentive to a producer, distributor, retailer, and non-profit organization. It is used to change a brand’s perceived price or temporary company value (Shimp, 2010: 46). In accordance with the theory of Kotler and Keller (2012: 513), the benefits of promotion are as follows. a. Ability to be attention getting: ability to get the attention and lead the customer to the product. b. Incentive: includes some concessions, incentive, or contributions that add the value to the customer. c. Invitation: includes different invitations to be involved in current transaction. AIDA Theory AIDA phases aimed to know the process of the customer in accepting a promotion through a media. a. Attention Attention is the early phase in AIDA theory, where the seller should be able to make the customer realize the existence of the product. This phase could be illustrated with customers following the account that had their attention. This is in accordance with the statement of Miles (2014) and Rico (2014: 18) that follower is an individual who pays a higher attention in something. b. Interest Interest is the second phase, where the seller had already got the attention. The phase indicates that the customer had an interest in posted product. The presence of interest in social media could be illustrated with early information search about the product. It could be done through comment feature or direct message. c. Desire Desire is the next phase after interest. In this phase, the seller’s account had already got the attention and interest of potential customer. Therefore, an emotional bonding to that account’s posts had been created. The bond is getting stronger and attracts the customer to seek further information about the product. This can be illustrated with the potential customer contact the available contact person of that account. d. Action Action is the last phase of this theory. In this phase, there is a decision making and action that caused a transaction between the seller and the buyer. In a social media, this can be illustrated with the presence of order and product payment. Brand Awareness The definition of brand awareness according to Aaker in Octavianti (2012: 184) is the customer’s ability to identify a brand as a part of particular product category. Customer’s Perception According to Sarwono (2012: 86), perception is an understanding created just after someone receives a stimulus from his surroundings through a thinking process.
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Customer’s Trust According to Chou, Chen, and Lin (2014), trust is someone’s act of expectation in an online situation that is full of uncertainty. Seller is expected to be able to give comfort and securities while the customer shops. RESEARCH METHODS This research used qualitative method. According to Sugiyono (2012: 9), qualitative research method is used to study the natural condition of an object. In a qualitative research, the researcher is the key instrument. The data was collected through triangulation technique. The data was analyzed by inductive analysis and the research is pointed mainly to the meaning instead of generalization. This research was done in Surabaya, because the product and research object is still distributed in Surabaya. This research was done in April until August 2016. Informants of this research are as follows. (1) Potential Customer: Crispymunch’s potential customers are chosen as informant of this research in order to know their response about marketing and sales through social media. They are also chosen in order to get explanations about what affects Crispymuch’s AIDA phases in social media. The informant’s criteria are: older than 17 years, using instagram social media, ever done an online shopping, and also never bought and consumed Crispymunch before. (2) Marketing Expert: Expert is someone who has expertise in marketing management, especially e-business. Expert informant was chosen by these criteria: a lecturer or expert in marketing field, understand the practical and theoretical concepts of ebusiness, understand the details of business especially in food and beverage, had a minimum 2 years experience in managing a business. (3) E-commerce Expert: Food blogger was chosen as an informant considering the knowledge and the experience in using social media for product marketing. The criteria of food blogger are: actively done blogging through social media for at least one year, discussed food related content, had at least 50 thousand follower accounts, and at least 500 likes for each photos. Data Collection Method The data collection method in this research is interview. Interview is a technique of data collection which done by asking questions directly to the informant (Bungin, 2011: 100). In this research, the interview technique was semi-structured interview that helps the researcher to search the information from the informant. The researcher had prepared the topic and questions list before the interview. Validity and Reliability Validity test in this research was done by triangulation. It was done by checking the proofs from various sources and use them in building a theme justification coherently. Triangulation technique used in this research was source triangulation. The data credibility was tested by checking it on some sources (Creswell, 2012: 286). The data was then described and categorized according to the similarity and specifications. Triangulation source was done by checking potential customer, expert, and food blogger’s answers related to the social media used by Crispymunch. They also asked to identify the weakness and make an alternative promotion model and effective online selling to eliminate the existing weakness. The reliability test in this research was using dependability technique. In this technique, the researcher tracks overall research process by looking for the answers’ consistency along the data collection process (Creswell, 2012: 288).
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RESULT AND DISCUSSION Attention The first thing to be concerned in the effort of gaining potential customer’s attention is choosing the suitable social media with company’s market target (Garst, 2013: 28). The statement is in accordance with the interview result. From the interview result, it was known that Crispymunch had already using a suitable social media, which is instagram. All of the respondents are using that social media as well. According to Diamond (2013: 11) the visual appearance is the first thing that gives first impression. It will also make the message stronger. Analysis of the interview result showed that the potential customers are still uninterested. This is because the visual appearance of the account is still low, from its photos and also packaging. According to Zimmerman (2015: 148), one of instagram’s marketing strategy is by using hash tags to reach and join with the followers, who are the potential customers of the industry. This is in accordance with the result of interview, which showed that the potential customer is usually find an online shop account from hash tags of related products, from the friends who follow or post the product, or appears in the explore section. This is also strengthened by the statement of expert and food blogger who said that a social media account will be easier to find by the potential customer through good promotions, advertisement, and endorsement. Interest Interest in AIDA marketing theory is a phase in which a company should be able to maintain the liking by using informative advertisement, so that it can persuade the customer about the importance of company’s product (Rawal, 2013). One indication of interest phase is the presence of interactions among potential customers. According to Jantsch (2015: 17-20), the way to use instagram social media as marketing media is by creating a positive brand and interesting content. The content should be interesting and has a particular characteristic so that it can be easily remembered by the market target in social media. According to the interview result with potential customers and food blogger, there are some things that make the potential customers interested and want to know more about the product. They are trend and popularity, world of mouth from potential customers’ circle, and the product’s appearance or packaging. Desire The third phase of AIDA marketing theory is Desire phase. According to Rawal (2013), in this phase the company begins to offer its product very convincingly to the customers in order to buy the product. From the interview result, after knowing detailed information about the product, customer will make a consideration before buys. Here, the task of the company is to convince the customer. According to Barnes (2015: 17-20), good content of social media is a content that is interesting, cultivate curiosity, and views the consumer’s perspective about products or company. Based on the analysis result there are some things that increase the intention of customer to purchase the product. They are priority level of the need or urgency, promotion, interesting product appearance, good quality that could be seen through reviews and testimonials, and also the trust level towards the seller. Trust is someone’s act of expectation to the seller in an uncertain online situation in order to get shopping comfort and securities (Chou, Chen and Lin, 2014). Meanwhile, Jantsch (2015: 17-20) said that the seller should has some attitudes including honesty, good interaction with the customer, and transparency. In accordance with the analysis result, criteria of trusted seller are able to give the best service, answering the questions clearly, giving the proofs of shipment, responsible, and of course be honest in doing the responsibilities.
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Action After through the Desire phase of AIDA marketing theory, the last task of promotion is to trigger an action of potential customer; in this context is to do the transaction (Rawal, 2013). The decision of buying a product online is affected by all the phases that had been described before. If the product and service fulfills the potential customer’s need and trust qualifications, the transaction will occur. According to the potential customers and expert, there are some factors that affect the online purchase decision. They are product quality and trusted seller. If both of is fulfilled, transaction will occur and the potential customer will decide to purchase the product. In detail, the service should be done well and suitable with the criteria of trusted seller. The seller should also be able to convince the potential customer to buy the product. After the purchase, it’s better for the seller to keep servicing the customer by asking for feedbacks and giving some information about the product. In Desire and Action phase, Crispymunch used Line and WhatsApp as easy and safe communication tools. Respondents said that Line and WhatsApp are good as communication tools since they have private characteristics so that transaction could be done safely and trusty. Implementation Plan Based on the interview result, analysis, and evaluation, there are some things that could be done by Crispymunch in order to improve the social media account, and also to increase online purchase intention. The effort that could be done by company is to get the attention from potential customers. This includes the increase of visual appearance (photos, captions, and interesting placements), decrease following, and increase followers to show the seller’s popularity. The solution to make potential customers interested with the product is by making trend or hype in target market, uploading customer’s testimonials that can increase the trust, and to improve the product’s appearance or packaging. After the potential customer become interested, seller should be able to make the customer desired to purchase the product. To increase this, the efforts that could be done are making promotion programs that increase the urgency to buy the product, managing the product’s appearance to be interesting, posting the reviews and testimonials as the proofs of product’s quality, and also increasing the trust towards seller. In the last phase, the factors that can affect the decision of product purchase are visual factors, urgency level, product’s physical aspects, and trusted seller. If the preceding three phases (attention, interest, and desire) are successfully passed, there will be a transaction. Planning for the last phase should ensure that the three phases were done well so that the product purchase intention could be increased. CONCLUSION AND SUGGESTION C onclusions Based on the analysis and discussion, it could be concluded that Crispymunch had already used a suitable social media that is instagram. It is widely used by the target market, and even all respondents used that social media. Attention from the potential customers is still low. The respondents mostly know the product from word of mouth. The way of customers in finding the online shop is from hash tags related to the product, from the friends who follow, or from explore section. The cause of low attention from potential customer is because of low visual appearance of account, both from its photos or packaging. Therefore, things that could be done in order to increase attention are by doing promotions from advertisement and endorsement. By that way, the product will be known by more people and the visual appearance quality could be improved. In the interest phase, the factors that can make the customers interested and want to know more about the product are trend and popularity, word of mouth from circle target market,
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and the appearance of product or packaging. Things that should be done are making trend or hype through events or promotions that can make the product become famous, uploading testimonials that can increase the trust, and also improving the product’s appearance. In desire phase, the company offers its product very convincingly so that the customers are willing to purchase, and after knowing detailed information about the product, the consumer will study or consider the purchase. Here the task of company is to convince the customer. Things that could be done to increase the purchase intention are urgency, promotion, and product appearance, outstanding quality from review and testimonials, and trust towards seller. The action phase is expected to trigger potential customer’s act, which is transaction. It is affected by all phases that had been passed. If the product and service given by the seller could fulfill the potential customer’s need and trust qualifications, transaction will occur. Things that could be done are convincing the customers about the product and giving good sale and post sale service, so that repeat order could occur. Suggestion Based on the analysis and discussion, suggested AIDA marketing strategies that are suitable for Crispymunch are as follows. a. Crispymunch should increase its brand awareness and create hype or trend by applying theme for booth, uniform and packaging, and showing premium quality product in its social media. b. Crispymunch should increase the promotion to make the product better known by the public. Online promotions can be done using advertisement, endorsement, cooperate with Gojek to facilitate customers to get the product, and promote discounts to increase product's purchase intention. c.Crispymunch can improve the appearance and content of its social media by increasing the number of posts, posting high quality photos, posting product testimonials and product related info, using clear captions, and trying to increase followers and reduce following. d. Crispymunch should set aside more funds to rent some booths and involved in a bazaar, so Crispymunch can provide tester for potential customers. REFERENCES Afrizal. (2014). Metode Penelitian Kualitatif. Jakarta : Rajagrafindo. Barnes, S. (2015). Like, Follow, Share:Social Media Marketing to Maximize Your Online Potential. California, USA: Tycho Press. Bugin, B. (2011). Metodologi Penelitian Kualitatif. Jakarta: Rajawali Pers. Chou, S., Chen C, W.,& Lin J, Y. (2014) Female Online Shoppers Examining the Mediating Roles of e-satisfaction and e-trust on e-loyalty development. Journal Emerald Group Publishing Limited. Creswell, J. W. (2012). Research Design: Pendekatan Kualitatif, Kuantitatif, dan Mixed (3rd ed.). Yogyakarta: Pustaka Pelajar. Delafrooz et al. (2011). Understanding Consumer’s Internet Purchase Intention in Malaysia. African Journal of Business Management. 5(3) Diamond, S. (2013). The Visual Marketing Revolution. USA: Pearson Education, Inc. Garst, K. (2015). Creating Your Social Media Strategy. Dalam M. Meyerson, Success Secrets of the Online Marketing Superstars. USA: Entrepreneur Press. Handayani, S. (2010). Laris Manis Jual Beli Lewat Kaskus – The Largest Indonesian Community. Yogyakarta : Mediakom.
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Hassan, et al. (2015). Strategic Use of Social Media for Small Business Based on the AIDA Model. Procedia Social and Behavioral Sciences. doi: 10.1016/j.sbspro.2015.01.363 Ioanas, E., & Stoica, I. (2014). Social Media and its Impact on Consumer Behaviour. International Journal of Economic Practices and Theories,4(2). Jantsch, J. (2015) Total Online Presence: The Seven Essential Stages. Dalam M. Meyerson, Success Secrets of the Online Marketing Superstars (hal. 17-23). USA: Entrepreneur Press. Kotler, P. T., dan Keller, K. L. (2012). Marketing Management (14th ed.). New Jersey : Pearson Education, Inc. Kotler, P. T., dan Keller, K. L. (2012). Management Pemasaran (14th ed.). Jakarta : PT. Index. Miles, J. G. (2014). Instagram Power. New York: Mc Graw Hill Education. Mukhtar. (2013). Metode Praktis Penelitian Deskriptif Kualitatif. Jakarta: Referensi. Mulya, P. (2011). Forum Manajemen Vol. XXV. Jakarta : Prasetiya Mulya Business School. Octavianti, M. (2012). Menumbuhkan Kesadaran Merek Produk Melalui Media Sosial : Studi Kasus mengenai Optimalisasi Penggunaan Twitter Sebagai Upaya Menumbuhkan Kesadaran Merek Maicih Keripik Singkong Pedas Asli Kota Bandung. Jurnal Ilmu Komunikasi, Vol.2, No.2, Oktober 2012: 178-194. Pride, W. M., dan Ferrel, O. C. (2012). Marketing (16th ed.). Boston: Cengage Learning. Rawal, M. P. (2013). AIDA Marketing Communication Model :Stimulating A Purchase Decision In The Minds Of The Consumers Through A Linear Progression Of Steps. Irc’s International Journal Of Multimedisciplinary Research In Social & Management Sciences, Issue: 1, Volume: 1, ISSN: 23208236. Sarwono, S, W. (2012). Pengantar Psikologi Umum. Jakarta: PT Rajagrafindo Persada. Serfiani, et al. (2013). Buku Pintar Bisnis Online dan Transaksi Elektronik. Jakarta: PT. Gramedia Pustaka Utama. Shimp, T. A. (2010). Integrated Marketing Communication in Advertising and Promotion (8th ed.). Canada: Cengage Learning. Simamora, B. (2011). Panduan Riset Perilaku Konsumen. Jakarta : PT. Gramedia Pustaka Utama. Sugiyono. (2012). Metode Penelitian Kualitatif dan R&D. Bandung: Alfabeta. Yulihasri, et al. (2011). Factors that Influence Customer’s Buying Intention on Shopping Online. International Journal of Marketing Studies, 3(1). Zarrad, H., dan Debabi, M. (2012). Online Purchasing Intention : Factors and Effects. International Business and Management, 4(1). Zimmerman, S. B. (2015). Instagram for Business: How to Brand Your Business and Build a Loyal Following. Dalam M. Meyerson, Success Secret of the Online Marketing Superstars (hal. 146-152). USA: Entrepreneur Press.
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Attachment
Figure 1.1 Projected population Source : bps.go.id
Figure 1.2 Growth of the food industry in 2010-2014 Source : Badan Pusat Statistik
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DETERMINING A SUITABLE PROMOTIONAL MIX FOR SILK- PRINTING INDUSTRY R-R TO RAISE THE BUSINESS’ TURNOVER 1Lucya Kumala Sari, 2Hermeindito Ciputra University Surabaya INDONESIA Email:
[email protected],
[email protected] ABSTRACT This research aims to compose a suitable promotional mix for Silkprinting Industry R-R. Elements of the promotional mix which were researched in this article includes advertising, personal selling, sales promotion, public relations and direct marketing. This research is a qualitative research with triangulation method. The data was gathered with in-depth-interviews with open-ended questions towards 3 groups of informants, which include regular customers of the silkprinting industry, professional workers of the silk printing industry and the owner of the Silk-printing Industry R-R. There are a total of eight informants participated in this research. According to the results of this research, there are other promotional mix elements which are effective and applicable for Silk-printing Industry R-R to attract the customers’ interest which will raise the business’ turnover. The additional promotional mix elements include advertising, specifically online promotion, personal selling, public relations and sales promotions. Keywords: promotional mix, silk-printing industry, customers’ interest, business’ turnover
INTRODUCTION Silk-printing Industry R-R is a company built in 2014. The company revolves around silkprinting, particularly on t-shirts, which also includes other medias such as plastic bags, caps, et cetera. The area where this company is located is a developing area, with only a few big competitors doing business in the same field, which is silk-printing. With this kind of advantage, the company has a great prospect with so much potential to grow, even before another big player arrived. As a business, Silk-printing Industry R-R has the need to promote their service. However, their marketing activities are considerably narrow, which usually only involves personal selling and mouth-to-mouth promotion. Nowadays, with how high the competitiveness and customer profile that is ever changing shows that a customer is the most important asset to a company. That is why, the competitive advantage, which results from practice that was designed to raise the customer’s satisfaction, or in other words, a customer-centric approach, is figured to increase financial performance and profitability of a company (Kosan, 2014).
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A promotion is one of the most significant element of marketing activities. In this world, multinational companies and even small-medium enterprises accepted the fact that there is no other alternative except promotion to communicate with consumers and to motivate them to buy any product or service they’re offering. In this competitive world, a company needs to be sensitive and sharp to identify the many factors affecting the market to survive (Abedin & Ferdous, 2015). The determination of the most suitable, effective and influential promotional mix have a strong, important and useful for decision makers and marketing planners. This is one of the main reasons why we took this topic. The other reasons includes a relatively stagnant turnover, how big the market’s potential and how low he competition is in Lombok. LITERATURE REVIEW Previous Research Marketing strategy is ever changing, along with the development of science and technology. Which is why to compose a promotional strategy, there are a few aspects that must be noted, such as the market, leadership, positioning and our company’s competitive advantage. Marketing Strategy Promotion is an integrated and comprehensive word, which includes all advertising activities, publicity, public relations, personal selling and sales promotions. In this ever competitive world, if a company wants to succeed, the company has to be ready and responsive to the factors that affect the market (Abedin & Ferdous, 2015). Nowadays, the service industry has been playing an important part of the economy of a country. In Indonesia, the service sector has been growing in a significant pace, which is shown by the increase of the service industries such as restaurants, tourism, banks, etc. The marketing of a service is a social and managerial process, where individuals and groups gain their needs by doing trades with other individuals or other groups (Iqbal, 2013). Promotional Mix Nowadays, marketing is more than providing something. It is all about providing a channel of information to the customers. In other words, modern marketing is something more than producing products with a high quality and a suitable price for the customers. A company has to communicate with its customers and potential customers. Customers are exposed by thousands of promotional activities daily. Companies has to compete for their attention with promotional activities (Familmaleki et al., 2015). Companies use many kinds of instruments to promote their products. Promotional mix is one of the term used to describe the tools used by a business to communicate the values of their product or service to the customers effectively (Familmaleki et al., 2015). The main promotional tools used are advertising, personal selling, sales promotion, direct marketing and public relations. The combination of these tools result in a promotional mix which is used for a company’s promotional strategy. Advertising is a paid non-personal communication about a company, product, service, or an idea by a sponsor. Personal selling, unlike the other tools, includes a direct link between sellers and potential customers. Personal selling is often called as the most effective element of a promotional mix in building the customers’ preference, faith, and their action in certain stages in making their purchase decision. Sales promotion is defined as one of the marketing activities used producers to induce and provide more values to their customers to stimulate the customers’ purchase decisions. Public relations is a conscious and coordinated effort of a company to maintain a good relationship between the shareholders of the company. Direct marketing is a promotional element which is done by using a direct channel to communicate with other customers by not using other mediators (Dixon-Ogbechi et al, 2014).
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Customers usually share their opinions, news, and information with others This interpersonal communication can be described as ‘word of mouth’. Word of mouth (WOM) is defined as an informal communication between customers about the ownership, use, or characteristic of a product and/or a service or other sellers (Berger, 2014). Some researches show that WOM that is intentionally looked for has more impact than unintentional WOM (Martensen & Grinholdt, 2015). RESEARCH METHODS This research is done with the qualitative approach, which took place in Mataram, where the Silk-printing Industry R-R is located. The sampling method used in this research is a non probability sampling, where every individuals has the same chance to be chosen as a sample (Herdiansyah, 2012). The data was taken by interview with open-ended questions which is done to 3 parties, the owner of the Silk-printing Industry R-R, Professional Human Resources, and customers of the silk-printing industry. The interview is about the elements of the promotional mix. The data is then analyzed by analyzing every aspect of the promotional mix which is gathered from the results of the interview from the 3 parties. The criteria of the informants used in this research is as follows: - Owner of the Silk-printing Industry R-R. - Professional Human Resources, whom has the minimum 5 years experience of work in the silk-printing industry. - Regular customers of the silk-printing industry. The data from the interview is then compared and checked with each party’s data and the data gathered from other source, which is the theory. RESULTS AND DISCUSSION From the data gathered, compared and analyzed, the resulting data is shown in the table below. Table 1. The Number of Informants with Positive Opinions About Each Elements of The Promotional Mix Customer SDM Owner Advertising
50%
100%
-
Personal Selling
75%
33%
+
Sales Promotion
75%
66%
+
Public Relations
100%
66%
-
Direct Marketing
100%
100%
+
The table above shows that the opinions about advertising is quite diverse, where most of the informants, 5 of 8 informants (62.5%), think advertising is quite effective in appealing to customers, with how wide the coverage is. This result is supported by the theory, where the theory states that one of the advantage of the advertising is the wide coverage. Besides, the company can also decide on the specifics of the message they are trying to send (Afande & Maina, 2015). Advertising in social medias also has their own advantage, which is the diversity of the customers accessing them. This diversity also means a wider coverage of the market (Paquette, 2013).
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Most of the customers (75%) state that the use of personal selling is quite effective to appeal to the customers. However, the cost needed is quite high. This result is supported by the theory, where the theory states that personal selling is one of the most expensive way to promote something, but effective in connecting the customers with the product and/or services of a company. Personal selling is one of the most effective way to build a relationship with the customer, thanks to its interactive aspect (Afande & Maina, 2015). Overall, the result about sales promotion is 6 of 8 informants (75%) state that sales promotion is quite effective in appealing for potential customers. This result is supported by the theory, which states that one of the purpose in doing sales promotion is to appeal to new customers and to introduce a new product. By doing sales promotion, the appeal of a product will increase, however, the cost is quite high (Afande & Maina, 2015). The opinions about the public relations is quite diverse, where 6 of 8 informants (75%) state that public relations is quite effective to appeal customers, just like advertising, thanks to its wide coverage. This statement is supported by the theory. The theory states that public relations is a relatively cost effective way to reach a wide group of people. However, its main weakness is the company will not be able to arrange what the media will cover about the company (Familmaleki et al., 2015). All of the informants in this research state that direct marketing is effective for a silk-printing industry. Direct marketing is usually stated as a tool that can promote the building of a relationship because of one of its advantages, which is the company can get a response from their target customer, which results in an exchange of views and/or communication. This communication will help the company to investigate and fix the problems that happened by reviewing the customer service or composing a special price for regular customers (Afande & Maina, 2015). Before this research is done, the promotional tools used by Silk-printing Industry R-R only revolves around direct marketing and word of mouth. After analyzing the result of this research, it is decided that the responses from the customer and the owner has the biggest value in determining an appropriate promotional mix. This is based on the assumption that the customer is the main target of a promotional mix, whereas the owner is the one that understands the status of the Silk-printing Industry R-R the most. According to the result of this research, there are some additional promotional tools that should be done by Silk- printing Industry R-R. These tools will be shown on the table below. Table 2. Managerial Implications of the Promotional Mix Promotional Mix Before Research After Research Direct Marketing Direct Marketing Word of Mouth Word of Mouth Online Promotion Personal Selling Public Relations Sales Promotion The additional promotional tools will mainly revolve around internet and the use of social media and websites, considering the industry’s budget. Two of the most expensive tools, which are sales promotion and personal selling, will be done according to the financial situation. Sales promotion will be done by composing a special price for the regulars, and personal selling will be done only to b to b customers.
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CONCLUSION According to the result of this research, there are a few conclusions, such as: - The result of this research shows that advertising is an effective promotional tool to appeal to the customers. Its main advantage is its wide coverage. - This research shows that personal selling is proven to be an effective tool to appeal to the customers, however, the cost needed is quite high. The main advantage of this tool is its interactive aspect with the customers. This tool is especially effective for the service industry. - The result of this research shows that sales promotion is an appealing tool for the customers, however, the cost needed is quite high. This tool is proven to be difficult to do in the service industry because of the difficulty in deciding a price. - This research shows that public relations has a similar advantage to advertising, which is its wide coverage. However, this tool also has a main weakness being the inability of the company to arrange what the media will cover about the company. - This research shows that direct marketing is the first choice for an effective promotional tool thanks to its advantage being its efficiency and ability to exchange information between the company and the customer directly. - The result of this research shows that there are other promotional tools that can be done by Silk-printing Industry R-R, such as online promotion, personal selling, public relations, and sales promotion. REFERENCES Abedin M. Z & Ferdous L. (2015). Promotional Strategies of Telecommunication Industries and Customers Perception: A Study on Airtel Bangladesh Limited, Global Journal of Management and Business Research: E Marketing, 15(3), pp. 74-91. Afande, F. O. & Maina, M. P. (2015). Effect of Promotional Mix Elements on Sales Volume of Financial Institutions in Kenya: Case Study of Kenya Post Office Savings Bank, Journal of Marketing and Consumer Research, 11, pp. 64-91. Dixon-Ogbechi B. N, Jagun S. O, Ighomereho S. O, Rahim G. A & Haran E. M. (2014). Determination of Promotional Strategy for Organizations in The Nigerian Insurance Industry Using The AHP Model, International Journal of the Analytic Hierarchy Process, pp. 1-5. Familmaleki M, Aghighi A & Hamidi K. (2015). Analyzing The Impact of Promotion Mix on Consumer’s Purchase Decision, Advanced Social Humanities and Management Journal, 2(1), pp 72-81. Herdiansyah, H. (2012). Metodologi Penelitian Kualitatif untuk Ilmu-ilmu Sosial. Jakarta: Salemba Humanika. Iqbal, M. A. (2013). Perkembangan Strategi Pemasaran dalam Industri Jasa, Jurnal Ekonomi, 4(2), pp. 145-150. Kosan, L. (2014). Accounting for Marketing: Marketing Performance Through Financial Results, International Review of Management and Marketing, 4(4), pp. 276-283. Martensen, A & Gronholdt, L. (2015). The role of social ties in word-of-mouth effectiveness: a segmentation approach, Innovative Marketing, 11(1), pp. 7-16. Paquette, H. (2013). Social Media as a Marketing Tool: A Literature Review, Major Papers by Master of Science Students, 2, pp. 1-26.
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THE EFFECT OF BRAND IMAGE, PERCEIVED PRODUCT QUALITY AND RECOMMENDATION (ELECTRONIC WORD- OF-MOUTH) TOWARD PURCHASE INTENTION OF X DESIGNS’ WEDDING INVITATIONS PRODUCTS Erine Raharjo, 2Tommy Christian Efrata♠
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Ciputra University Surabaya INDONESIA ABSTRACT Internet has changed people habits to socialize. Nowadays, people use social media in internet to socialize, it also changes the way companies promote their products and brands. One of the popular social medias that also used widely as a media campaign in Indonesia is Instagram. Learning about the influence of brand image, perceived product quality and recommendation/eWOM on Instagram that influence to puchase intention is expected to add more comprehension in purchase intention as well as providing input for business promotion strategy through social media. This is a quantitative research that examines the purchase intention of X designs’ wedding invitation vendor in Surabaya. The collection of data was done by spreading online questionnaires randomly on 230 respondents who were Instagram users who had left comments on some posts on the X designs’ Instagram account. The collected data is 40, then it is analyzed by using multiple linier regression analysis method. The result is brand image and perceived product quality have no effect on purchase intention, only recommendations/eWOM has influence on purchase intention. The findings will benefit wedding invitation industries and marketers to have better understanding of the factors that affect the purchase intention in Instagram and to be more competitive in the modern era as now. Keywords: brand image, perceived product quality, recommendation/eWOM, purchase intention, purchase intention in social media Instagram INTRODUCTION The rapid changes of the world affects people, MarkPlus highlighted significant rise in middleclass economic group in Indonesia (Kartajaya & Setiawan, 2014). It also affects their lifestyle, they tend to take the risk to buy expensive stuff though they couldn’t afford it. The changes also happen to marketing in digital era as it is now. Marketers is expected to be smarter in the way they promote products because nowadays, consumers do a lot of window shopping, the definition of shopping changed from buying to just browsing (Mulyadi, 2017). In these digital era, there are too much information for everyone, almost every industry becomes red ocean. The one which lasts is the one which changes the marketing strategy of their products. In the digital era, especially in Indonesia whose population reaches 262 million, the internet users have reached 132,7 million. Their social habits is changed, for now they tend to use social media to socialize via internet. Social media users in Indonesia have reached 106 million, 92
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million of them using social media via smartphone (Hootsuite & We Are Social, 2017). They tend to use popular social medias such as Facebook, Instagram, Google etc. One of the popular social media for promotion is Instagram. The media which was acquired by Facebook in 2012 has a feature to share photos and videos. Based on research from BMICG (2017) about social media preference in Indonesia 2017, 80% of consumers in Indonesia are severely affected by social media in determining product to be purchased. In terms of looking for products, 35% of consumers tend to use Instagram than Facebook. Promotion trends on instagram are also used by vendors in the wedding industry such as venue vendors, decorations, bridal, to wedding invitations. One of the companies with wedding invitation products which targeted middle-up market that also use Instagram is X designs. The company was established in 2014 in Surabaya and focus on using promotion via online. In Instagram, as a promotion, X designs has been trying to post contents that can lead to create brand image, consistently posts product photos as well as being reviewed by Bridestory and Weddingku – some of renowed wedding consultants in Indonesia. The promotions may generate purchase intentions, and subsequent purchase intentions will result in a purchase decisions. Therefore it will be examined the influence of brand image, perceived product quality and recommendations/eWOM towards purchase intention of X designs’ wedding invitations products. LITERATURE REVIEW Brand Image and Puchase Intention Brand is defined as a name, word, sign, symbol or design or combination of all that is meant to identify the goods and services of the seller and to differentiate them from competitors (Kotler, Armstrong, & Sabran, 2008). There are 3 sources of brand recognition through marketing communications, family and friends community recommendations, the last is through the experience itself. In strengthening a brand name in the minds of consumers, the important factor is brand image (Zamrudi, Suyadi, & Abdillah, 2015). Brand image is also defined as consumer perception in general and feelings about a brand, in which brand image can affect consumer behavior (Zhang, 2015). Brand image according to Kotler and Keller (2012) in Romadon, Kumadji and Abdillah (2014) are beliefs about a brand that is in the minds of consumers. Through marketing communications, the brand began to be known to consumers, amid hundreds of other brands that consumers meet every day (Kartajaya & Setiawan, 2014). All aspects of the promotion received by consumers also affect the consumer's impression of the brand image. Consumer impression includes brand credibility and company reputation. Brand credibility and reputation enhance and influence the likelihood that the brand can be a consumer choice (Walsh, Shiu, & Hassan, 2012). The more relevant a brand with its consumer personality, the stronger the consumer's interest to buy (Thamizhvanan & Xavier, 2013). According to Aaker (1991), consumers have a tendency to buy products with a wellknown brand, this is because of consumer perception that the famous brand has good quality and reliable when compared with unknown brand (Romadon, et al., 2014). Brand image according to Biel (1992) in Romadon, et al. (2014) consists of three aspects, Corporate Image, User Image and Product Image. In this study, the definition used to explain the brand is the definition of brand image by Romadon, et al. (2014) with the indicators that compose them include corporate image, user image and product image. So it can be concluded that the brand image has an influence on consumer’s purchase intention. Therefore the hypothesis formulated by researchers is as follows.
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H1: Brand image affects purchase intention significantly. Perceived Product Quality and Purchase Intention Product quality can be defined as a product characteristic that depends on its ability to satisfy customer needs expressed or implemented (Kotler, et al., 2008). In relation to the study of consumer behavior, product quality can not be separated from consumer perceptions about the quality of a product (perceived product quality). According to Tsiotsou (2006), consumer perceived product quality have a direct influence on purchase intention. Perceived product quality is consumer perception about product quality, where perception about product quality is composed by character or feature of product itself (Everard & Galletta, 2006). According to Kotler, et al. (2008) perceived product quality is the ability of the product to show various functions including resilience, reliability, accuracy, and ease of use. Consumers who like to shop tend to choose quality when faced in choosing a seller/store where they will make a purchase. In the context of online buying, consumers who like to buy goods online are significantly more concerned with quality (Thamizhvanan & Xavier, 2013). With good quality, consumer tendency to buy will be higher. In this study, perceived product quality is using the definition of product quality perception by Becker (2000) which describes that consumer perceptions about product quality are measured by intrinsic and extrinsic signs, intrinsic signs include the product characteristics obtained sensitively. Extrinsic marks include information about products obtained from the medias. According to Becker (2000) and Everard, et al. (2006), the indicators that make up the perceived product quality consist of three factors, namely search quality cues (marks on product displays obtained when consumers pick and choose products), experience quality cues (the experience consumers gain about using products) and credence quality cues (consumer confidence about a product about information provided by others through the media about the product). Therefore it can be concluded that there is a relationship between the perceived product quality and purchase intention. The hypothesis formulated from the relationship between perceived product quality and purchase intention is as follows. H2: Perceived product quality affects purchase intention significantly. Recommendation/eWOM and Purchase Intention In this modern era, recommendation or word-of-mouth refers to electronic- worth-of-mouth (eWOM), which is defined as a positive or negative statement made by the consumer about a goods/service/company available to a wide audience via internet (Abubakar, Ilkan, & Sahin, 2016). Recommendations also have an important role in creating a relationship with purchase intention. Park, Wang, Yeo & Kang (2011) also explained that eWOM is a form of communication on the internet but it is not a face-to-face communication or through words directly. The high use of the internet makes the media of communication as a medium that accommodates word- of-mouth to be a useful source of information and has an influence on consumers as well as commodities (Pervin, 2014). To make a purchase, consumers tend to use many sources of information such as seller history, advice from friends and messages from sellers (Guo, Wang, & Leskovec, 2011). By using social media, consumers can create content and offer valuable advice to others (Hajli, 2014). In the wedding industries, some account that often provide product recommendations in Instagram are Weddingku and Bridestory. Social communication in the form of online reviews, posts and WOM will play a big role in encouraging consumer purchase intention (Priyanka, 2013). This communication is believed to have a high degree of persuasion because of its credibility and trust. EWOM consists of reviews from various people from different social classes and different locations with limited social ties. Social influences can increase the preference for goods / services that will ultimately increase trust in the seller (Xu, 2014). MarkPlus's research shows that 9 out of 10 people trust more about the recommendations of others than the claims made by brands (Kartajaya & Setiawan, 2014). Erkan (2015) describes that social media
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provides support to the public to use the true identity which by using the actual identity, wordof-mouth made become more credible. The relationship between consumers and brands in social media, such as by giving like, share and commenting will be seen by friends of consumers and it is meant by electronic word-ofmouth (Hoffman & Fodor, 2010 and Erkan, 2015). In relation to the study of consumer behavior, according to Park, et al. (2011) there are three indicators that can compose eWOM's impact on consumer behavior that is, the effect of positive comments/reviews, the effect of reliable comments and the overall effect of existing reviews. So the hypothesis formulated from the relationship between recommendation/eWOM and purchase intention is as follows. H3: Recommendation/eWOM affects purchase intention significantly.
Figure 1. Research Model Source: Data Processed, 2017 RESEARCH METHODS This research is a quantitative research. Data collection was done by distributing questionnaires via online to 230 Instagram users who left comments on X designs’ Instagram account from September 25, 2014 to January 19, 2017. Based on sampling theory from Sekaran (2013), the sample required in this study is 40. This research was conducted during April 2017. The questionnaire uses Likert five-point- scale with the value of 5 = strongly agree, 4 = agree, 3 = neutral, 2 = disagree, 1 = strongly disagree. The definition of purchase intention is an idea that gives consumers the courage to buy, which can be measured by consideration of buying a brand and expection in buying a brand. Indicators for purchase intention in this research adopted from Abubakar, et al. (2016) are consideration in buying certain brand, willingness to recommend to others, expection to buy a brand. Brand image means beliefs about a brand that is in the minds of consumers, where the beliefs include beliefs about the company, products and users of the product. Indicators for brand image using corporate image, user image and product image taken from Romadon, et al. (2014). Definition of perceived product quality is the consumer's perception of a product as measured by the intrinsic and extrinsic factors of the product. The indicators for perceived product quality were adopted from Everard, et al. (2006), namely, search quality cues, experience quality cues and credence quality cues. And the last, definition of recommendations / eWOM is a form of communication on the internet medium but not face-to-face communication that can be measured by its impact on consumer behavior. Indicators for recommendations/eWOM adopted from Park, et al. (2011) are the effects of positive comments/reviews, the effects of the reviews and the effects of the comments. This research use multiple linear regression analysis method to analyze data.
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RESULTS Through respondents’ demographic profiles data in Table 1, it can be understood that X designs consumer is dominated by female consumer with age range 25 y.o. - 34 y.o. (72,5%), with education field not related to art (70%). Consumer X designs are mostly employees (40%) and entrepreneurs (37.5%) domiciled in Surabaya and its surrounding areas (65%) with middle economic level with average daily spending between Rp25,000,00 to Rp200,000,00 (87,5%). They are also active internet users who use the internet more than 4 hours per day (72,5%). Table 1. Demographic Profiles of Respondents Fre % Fre % q. q. Age Gender < 25 y.o. 10 25 Female 40 100 25 - 34 y.o. 29 72, Domicile > 34 y.o. 5 1 2,5 Surabaya and 26 65 surrounding 14 35 Educati Outside Surabaya and on surrounding Related to 12 30 Daily art Not spending related to art 28 70 < Rp25.000,00 2 5 Rp25.000,00 35 87,5 Jobs Rp200.000,00 Students 3 7,5 3 7,5 >Rp200.000,00 Employee 16 40 Daily internet Usage Entrepren eur 15 37, <3 3 7,5 Housewif 5 hours e 3-4 5 12, 8 20 hours Not 5 working >4 1 2,5 29 72,5 hours Source: Data Processed, 2017 The first test in processing the data is validity test. The result of this test is all independent variables and dependent valid (sig. Pearson corelation = 0,000). The next test is reliability test to know whether the indicators used are reliable or not. The result is all indicators used reliable with Cronbach alpha > 0,6 that can be seen on Table 2. Table 2. Reliability Test Result No Variab Cronbach Explanati . le Alpha on 1. Brand Image 0,892 RELIABL E 2. Perceived Product 0,870 RELIABL Quality E 3. Recommendation/e 0,893 RELIABL WOM E 4. Purchase Intention 0,863 RELIABL E Source: Data Processed, 2017
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The next is the classical assumption test, the first is multicollinearity test. The result as seen as Table 3, there is no multicollinearity problem (VIF < 10). Table 3. Multicollinearity Test Result Model Collinear ity VIF Brand Image 2,944 Perceived Product 3,389 Quality Recommendation/e 1,293 WOM Source: Data Processed, 2017 Next performed normality test, the result as seen on Table 4 is no problem of normality found (sig. > 0,05). The third is linearity test, at Table 5, the result is no linearity problem (sig. linearity < 0,01). And the last test is a heteroscedasticity test that can be seen on Table 6, the result is no heteroscedasticity problem (sig. t > 0,05). Table 4. Normality Test Result One-Sample KolmogorovSmirnov Test Unstandardized Residual Test Statistic .134 Asymp. Sig. (2.069c tailed) a. Test distribution is Normal. b. Calculated from data. c. Lilliefors Significance Correction. Source: Data Processed, 2017 Table 5. Linearity Test Result Independent Variable Depend ent Variabl e Brand image (X1) Purchas e Intention Perceived Product Quality ( Y) (X2) Recommendation/eWOM (X3) Source: Data Processed, 2017
Sig. Linearity
0,001 0,000 0,000
Table 6. Heteroscedasticiy Test Result Model Sig. (Constant) Brand Image Perceived Product
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Quality 7 Recommendation/eW 0,41 OM 7 Source: Data Processed, 2017 The next is multiple linear regression analysis that can be seen on Table 7. The value of sig. F in the simultaneous test is 0,000. That means there are independent variables that affect the dependent variable. Table 7. Multiple Linier Regression Test Result Model Sig. t F (Constant)
0,96 0,00 1 0 Brand Image 0,16 9 Perceived Product 0,81 Quality 7 Recommendation/e 0,00 WOM 1 Source: Data Processed, 2017 On the partial test results in Table 7, only recommendation variables that have sig. t < 0,05 (sig. t = 0,001) which means that variables affect the purchase intention. The other two variables, brand image (sig. t = 0,169) and perceived product quality (sig. t = 0.817) have no effect on purchase intention. In conclusion, H1 and H2 are rejected, while H3 is accepted. DISCUSSION In this study, the cause of the brand image has no significant effect on purchase intention allegedly because X designs have not been able to create a strong brand image in the minds of consumers. This result supported previous research conducted by Chin & Harizan (2017) about cosmetic product in Malaysia and Wani, et al. (2016) about online shopping in India. Brand image formed in the minds of consumers is dominated in terms of products offered by X designs, this can happen because of several things. Firstly, X designs consumers who are independent and logical-minded career women tend to focus more on the products offered than the image of X designs company which is a new company and has a lot of competitors in this field. The second is the product offered X designs belonging to the category of tertiary products made in accordance with consumer demand, so that the user image displayed is influenced by the desired image by consumers, not just from the typical image of the product made by X designs. So it can be concluded that in X designs which is a company with wedding invitation products, brand image does not affect consumer interest to use the product invitation wedding. In this study, which allegedly caused the perceived product quality has no significant effect on purchase intention allegedly because consumers tend to see X designs wedding invitation products based on the attractiveness of the product. This result is supported to previous study by Santoso, et al. (2016) about food private label in Bogor, Indonesia. Consumer X designs who are young women who use the internet daily in a high frequency will have enough time to search and compare products they want. In addition, as consumers who use the internet with a long duration, women who are consumers X designs already really understand about products that are marketed online. For them the quality of products that are marketed online is not
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enough just shown, stated and informed by the manufacturer / marketer of the product. Consumers are more logical and observant in perceiving the quality of the product by searching for as much information related to the product. So for consumer X designs, product quality perceptions displayed by X designs themselves on social media accounts Instagramnya not enough to affect consumer interest to use the product invitation wedding. In this study, the things that allegedly caused the recommendation / eWOM factor had a significant effect partially on the purchase intention among others is the object of this research is the social media account Instagram of X designs. This result supports previous research by Abubakar, et al. (2016). In general, social media is a container that connects users with one another to socialize therefore the influence of this socialization can also affect users, the Instagram socialization is more directed to Instagram feature that is to share photos and videos. In this case, X designs majority consumers are people who use the internet daily with a long duration, so there is a possibility that they also use the internet to socialize and seek information. The second thing that allegedly caused the recommendation / eWOM factor to influence purchase intention partially is consumer who is woman in productive age group which also an active internet user. This consumer group tends to be more easily influenced by positive reviews of accounts relating to vendors of wedding consultans like @bridestory and other consumers who have already used X designs wedding invitation products. This is indicated by the answer to the statement relating to the recommendations/eWOM in this study. In addition, the high frequency of internet usage indicates that consumers tend to do more socialization on online media and accessing wider information. Although influenced by information on social media, consumers who are women have not yet fully rely on that information in determining purchasing decisions. It is known from the results of respondents' answers that have a lower level of approval on related statements in relying on reviews and comments than any other statement. So it can be concluded that the recommendation / eWOM affects consumer interest to use product X designs, which uses social media Instagram as a medium of promotion. Limitations in this study were the research questionnaires only distributed to respondents who had previously left a message related to asking prices on X designs’ Instagram account from September 25, 2014 to January 19, 2017, the long range between 2014 and 2017 makes it possible to the respondents to be at the different level of decision making. And the second is that this study only examines X designs’ Instagram and its related contents (such as uploads by X designs or @bridestory consumers related to X designs wedding invitation products). CONCLUSION This research is conducted to test and explain things that have an effect on consumer purchase intention. In this research the things studied are brand image, perceived product quality and recommendation / eWOM, to purchase intention. Based on the results of data analysis by using multiple linear regression analysis in this study, it can be concluded that the brand image and perceived product quality has no effect on purchase intention. This is due to the absence of brand image and perceived product quality intact in the minds of consumers X designs. Consumers who are career women with high frequency of internet usage is more easily influenced by the recommendations / eWOM on the internet. Therefore, in this study recommendation has an effect on purchase intention. Based on the result of this research, brand image and perceived product quality is known not to influence purchase intention, only recommendation / eWOM that influence purchase intention. Researchers suspect that both of these (brand image and product quality perceptions) have not been created so strongly in the minds of consumers compared with recommendations / eWOM.
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Furthermore, both of these can be improved by X designs so as to give a significant influence on purchase intention. The reason is that in previous research, brand image and perceived product quality can influence consumer purchase intention, although this does not happen in this research. Based on the result of this research, brand image and perceived product quality is known not to influence purchase intention, only recommendation / eWOM that influence purchase intention. Researchers suspect that both of these (brand image and product quality perceptions) have not been created so strongly in the minds of consumers compared with recommendations / eWOM. Furthermore, both of these can be improved by X designs so as to give a significant influence on purchase intention. The reason is that in previous research, brand image and perceived product quality can influence consumer purchase intention, although this does not happen in this research. Suggestion for further research is to do research with the same model on different objects. The purpose is to find out whether the model in this study is widely applicable or not. Allegedly, by doing further research, it can be complete the understanding about things that influence consumer’s purchase intention in social media, especially Instagram.
REFERENCES Abubakar, M., Ilkan, M., & Sahin, P. (2016). eWOM, eReferral and Gender in the Virtual Community. Marketing Intelligence and Planning , 34 (5), 692-710. Becker, T. (2000). Consumer Perception of Fresh Meat Quality : A Framework for Analysis. British Food Journal , 102 (3), 158-176. BMICG. (2017, Maret 6). Social Media Behaviour & Buying Decision 2017. Retrieved Maret 7, 2017, from slideshare.net: https://www.slideshare.net/ BMICG/social-mediabehavior-buying-decisions-2017?qid=cbfeb3ce-3885- 49cc-9aa479595b767a79&v=&b=&from_search=2 Chin, T. K., & Harizan, S. H. (2017). Factors Influencing Customers’ Purchase Intention of Cosmetic Product in Malaysia. International Journal of Business and Innovation, 3 (1), 1-15. Erkan, I. (2015). Electronic Word of Mouth on Instagram: Customers' Engagements with Brands in Different Sectors. International Journal of Management, Accounting and Economics , 2 (12), 1435-1444. Everard, A., & Galletta, D. F. (2006). How Presentation Flaws Affect Perceived Site Quality, Trust and Intention to Purchase from Online Store. Journal of Management Information Systems , 22 (3), 55-95. Guo, S., Wang, M., & Leskovec, J. (2011). The Role of Social Networks in Online Shopping : Information Passing, Price of Trust, and Consumer Choice. California: ACM. Hajli, N. (2014, March). A Study of the Impact of Social Media on Consumers. International Journal of Market Research, 56 (3) , 387-404. Hoffman, D. L., & Fodor, M. (2010). Can You Measure the ROI of Your Social Media Marketing? MIT Sloan Management Review , 52 (1), 41-49. Hootsuite & We Are Social. (2017, January 24). Press Release: New Research Reveals Global Social Media Use Increased by 21 Percent in 2016. Retrieved March 18, 2017, from Hootsuite: https://hootsuite.com/ newsroom/press- releases/digital-in2017-report Kartajaya, H., & Setiawan, I. (2014). WOW Marketing. (Y. Savitry, Ed.) Jakarta: PT Gramedia Pustaka Utama. Kotler, P., Armstrong, G., & Sabran, B. (2008). Prinsip - prinsip Pemasaran : jilid 2 (Vol. 2). Jakarta: Erlangga.
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Kotler, P., & Keller, K. L. (2012). Marketing Management (14 ed.). Pearson Education Limited. Mulyadi, I. (2017, Januari 25). Ad Madness. Retrieved Februari 28, 2017, from Marketing.co.id: http://www.marketing.co.id/iklan-dan-promo-dalam-dunia- saratdata/ Park, C., Wang, Y., Yao, Y., & Kang, Y. R. (2011). Factors Influencing eWOM Effect Using Experience, Credibility, and Susceptibility. International Journal of Social Science and Humanity , 1 (1), 74-79. Pervin, N. (2014). Electronic Word-of-Mouth: Applications in Product Recommendation and Crisis Information Dissemination. Thesis submitted for the Degree of Doctor of Philosophy .
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DESCRIPTIVE ANALYSIS OF JOB SATISFACTION, EMPLOYEE ENGAGEMENT, AND ORGANIZATIONAL COMMITMENT IN XMG REAL ESTATE BROKER 1
Ambrosius Wishaldi Limiadi, 2David Sukardi Kodrat♠ Ciputra University Surabaya INDONESIA Email:
[email protected] ABSTRACT
This study aims to describe the following conditions of job satisfaction, employee engagement, and organizational commitment in XMG’s real estate agents. Firstly, the job satisfaction (X) is described within these nine influential factors, such as: pay, promotion, supervision, benefit, rewards, operating conditions, coworkers, nature of work, and then communication. Then, the employee engagement (Y) is described within these ten influential factors, such as: career development, training, leadership, work environment, recognition, management, alignment, infrastructure, performance measurement, and communication. Lastly, the organizational commitment (Z) is described within these categories, such as: affective commitment, continuance commitment, and then normative commitment. The analytical tool used to describe in this study is the standard statistical analysis with mean, standard deviation, mode, and median in each of the influential factors. The population for this study is the entire real estate agents in XMG, which is 42 people, and the sample size is 32 people determined by using non-probability purposive sampling in which only those who have worked since before March 2017. Based on the results of the analysis, it has been described that the job satisfaction is qualified as moderately high, where the highest satisfaction is seen in the nature of work factor, and the lowest is in the pay factor. Then, the employee engagement has been described and qualified as moderately high, where the highest engagement came from the leadership factor, and the lowest is in communication factor. Lastly, commitment has been qualified as moderately high which the highest form commitment is affective commitment and the lowest form of commitment is continuance commitment. Keywords: Descriptive analysis, job Satisfaction, employee engagement, organizational commitment, real estate broker INTRODUCTION XMG is a real estate brokerage company established in 2012 and in the last 5 years, there has been a decline in the number of broker recruitment as well as an increase in the turnover rate of existing broker in the company. There are external and internal reasons why this problem occurs. Externally, the competition in brokerage industry has increased tremendously within the last few years, and thus all the offices are competing to offer a better commission deal to recruit brokers including from the competitors. Internally, the brokers who resigned from XMG reported some dissatisfaction in the commission deal. Many of them also admitted to have other jobs that required higher priority than this brokerage job.
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In order to resolve this issue, the management of XMG then decided to switch to a new system that provides a higher commission percentage to brokers, and also offers a new career path to reduce the turnover rate. In the period of January to May 2017, this new system has been proven effective to increase the number of broker recruitment to XMG. Therefore, the management of XMG needs to further assess the internal conditions of brokers in order to evaluate the improvement from the new system. The purpose of this study is to provide a descriptive analysis of the current job satisfaction, employee engagement, and organizational commitment conditions of the existing brokers in XMG. LITERATURE REVIEW Previous Research Goetz et al. (2015) conducted a research to explore the working atmosphere and satisfaction of employees at various health institutions in Kenya. The researchers used a questionnaire with Likert scale and then analyzed the responses with statistical analysis model including mean value and standard deviation to describe the satisfaction. Vaksalla and Hashiman from University Sains Malaysia (2015) also conducted a research on how hope, personal growth initiative, and meaning in life predict work engagement, and the researchers also used the same method with questionnaires and Likert scale. Every variable was then described using statistical analysis using mean value and standard deviation. Cullinan et al. (2008) conducted an exploratory research on the effects of organizational commitment in three American-based companies. The researchers also used the same quantitative methods and statistical analysis to describe the organizational commitment conditions. These previous researches on job satisfaction, employee engagement, and organizational commitment used different sampling methods, but all used the same instruments and statistic analysis to gather and analyze the data. Hence, this descriptive study is using the suitable sampling method to the population of XMG, and the research instrument is a set of three questionnaires with Likert scale. Xavier Marks Graha (XMG) PT. HSC is a real estate brokerage company established in 2012 and located in Surabaya. In the first 5 years, the company is using a franchise brand, and then changes to new XM system in the beginning of 2017. Hence, the company is currently using the brand XMG. This change is due to a problem in decreasing broker recruitment and retention. The prospect in real estate business is still very promising as more and more competitors begin to open new offices. Therefore, this study is important to provide detail description of the internal conditions of brokers working in XMG so that the management can plan the best strategy to recruit and retain its brokers. Job Satisfaction H.L. Kaila (2015) in “Organizational Psychology” quotes Stephen P. Robbins the definition of job satisfaction as the positive feeling when an employee receives the suitable reward according to his expectation. According to Kaila, there are some influencing factors to job satisfaction that will be used as variables in the instrument of this study, such as pay, promotion, supervision, benefits, rewards, operating conditions, coworkers, nature of work, and communication. Employee Engagement Kular et al. (2008) quotes William Kahn the definition of employee engagement as the full participation and expression of the employees in performing their work physically, rationally, and emotionally. Saks (2006) proposes a theory that employee engagement is a way the
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employees respond to the things that they have received from the company. For example, when a company has provided well-equipped facilities, employees then will show a higher engagement with an extra effort to maximize that given tools to reach the company’s goals. In this study, the questionnaire includes 10 factors in employee engagement (Kaila, 2015), such as career development, training, leadership, work environment, recognition, alignment, management, infrastructure, performance measurement, and communication. Organizational Commitment H.L. Kaila (2015) defines organizational commitment as an indicator whether an employee will stay in the company after a period of time. Natalie J. Allen and John P. Mayer are quoted in Kaila (2015) to define organizational commitment into 3 categories, such as: continuance commitment, normative commitment, and affective commitment, and they conclude that employees with continuance commitment will stay in the company because they have to, and those with normative commitment feel that they have to stay, while those with affective commitment will remain in the company because they want to. Kaila (2015) quotes Richard T. Mowday that those employees with affective commitment will bring positive contribution and productive work to achieve the goals and values of the company as if those are their own. RESEARCH METHODS This research study is a descriptive analysis to provide detail description on the current job satisfaction, employee engagement, and organizational commitment conditions of real estate brokers in XMG. The total current population of brokers in XMG is 42 people, and using the non-probability purposive sampling (Sarwono, 2006: 17), the sample for this research study is determined to include brokers who have been recruited before March 2017. Thus, the total participants are 32 people with 10% degree of confidence (Sarwono, 2006: 120). The instrument for this research study is a set of questionnaires using 7 point in Likert scale. First, the questionnaire for job satisfaction (X) includes 9 influencing factors with 4 statements for each factor. Second, the questionnaire for employee engagement (Y) includes 10 influencing factors with 3 statements to describe each factor. Lastly, the questionnaire for organizational commitment (Z) includes 3 categories with 8 statements in each category. In addition, participants also provide their gender, age, and working duration. After collecting the data, these sets of data are tested for their validity and reliability using Pearson Correlation and Cronbach Alpha, respectively (Sugiyono, 2015: 176). Sugiyono explained that the set of data is valid when the significance level is less than 0.05 (α = 5%), and it is reliable if the Cronbach Alpha value is higher than 0.6. For the descriptive analysis, the central tendency of these sets of data is determined by calculating the mean, median, mode, and the degree of variance is determined by calculating the standard deviation (Sugiyono, 2015: 253). Variable X Job Satisfaction
Variable Y Employee Engagement
Variable Z Organizational Commitment
Descriptive Analysis 1. Mean 2. Standard Deviation 3. Mode 4. Median
Figure 1. Research Model Structure
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RESULTS AND DISCUSSION The total number of participants in this study is 32 brokers in XMG, and the demography of these participants is summarized in Table 1. Majority of the participants are 75% male, 56% in the age range of 21-30 years old, and 54% with less than 1 year to 2 years work duration. Table 1. Summary of Participants’ Demography Gender Age Range (Year) Work Duration (Year) 1< 2< 3< t 21- 2636- 41M F >46 t ≤1 t ≤ t ≤ t ≤ >4 25 30 40 45 2 3 4
Demography Num. of Participants
24
8
8
10
5
6
3
12
5
3
8
4
All the data are then tested for their validity and reliability, and those that do not pass are removed from further analysis to describe the results of the study. The results from the descriptive statistical analysis are summarized in Table 2, and overall, the average condition for all job satisfaction, employee engagement, and organizational commitment are qualified as moderately high. None of the variables are qualified less than neutral, and the degree of variance among the data are fairly homogenous. Tabel 2. Results of Descriptive Statistic Analysis Std. Average Job Satisfaction Mode Median Mean Dev. Percentage 4 4 4.57 1.54 65 % Pay 6 6 5.22 1.40 75 % Promotion 6 6 5.52 1.46 79 % Supervision 4 4 4.60 1.41 66 % Benefit 4 5 4.93 1.54 70 % Reward Operating 6 5 5.22 1.39 75 % Cond. 6 6 5.44 1.29 78 % Coworkers 6 6 5.63 1.04 80 % Nature of work 6 6 5.24 1.51 75 % Communication Average 5.15 74 % Employee Engagement Career Development Training Leadership Work Environment Recognition Alignment Management Infrastructure Performance Measurement
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Mode
Median Mean
Qualification Moderately High High High Moderately High Moderately High High High High High Moderately High
Std. Dev.
Average Percentage
Qualification
6
6
5.17
1.48
74 %
Moderately High
6 7
5 6
5.05 5.66
1.30 1.45
72 % 81 %
Moderately High High
6
6
5.48
1.29
78 %
High
4 6 6 6
5 5 6 5
4.75 5.16 5.60 5.15
1.53 1.47 1.33 1.25
68 % 74 % 80 % 74 %
Moderately High Moderately High High Moderately High
5
5
5.16
1.28
74 %
Moderately High
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4 Communication Average
5
4.68
1.41 5.19
Organizational Std. Mode Median Mean Commitment Dev. 6 6 5.21 1.31 Affective Com. Continuance 4 4 4.35 1.58 Com. Normative 6 5 4.83 1.56 Com. Average 4.76
67 % 74 %
Moderately High Moderately High
Average Percentage 74 %
Moderately High
62 %
Moderately High
69 %
Moderately High
68 %
Moderately High
Qualification
Job satisfaction is described in these 9 factors, such as: pay, promotion, supervision, benefit, rewards, operating conditions, coworkers, nature of work, and communication. Overall, the average satisfaction level is moderately high with the highest satisfaction in the nature of work and the least satisfaction in the financial income. Employee engagement is described in the following 10 factors: career development, training, leadership, work environment, recognition, management, alignment, infrastructure, performance measurement, and communication. Overall, the average engagement level is moderately high with the highest engagement reported in leadership and the least engagement observed in communication. Organizational commitment is described in these categories, such as affective, continuance, and normative commitment. Overall, the commitment level is moderately high. The affective commitment has the highest average while the continuance commitment is the lowest. Table 3. Average Percentage of Job Satisfaction, Employee Engagement, Organizational Commitment in XMG Brokers Gender Age Range (Year) Work Duration (Year) 1< 2< 3< Job Satisfaction t 21- 26- 36- 41t L P >46 t≤ t≤ t≤ >4 25 30 40 45 ≤1 2 3 4 64 71 57 65 72 73 62 70 63 74 60 59 Pay 73 79 66 74 86 76 76 75 79 60 70 86 Promotion 79 80 73 81 84 81 74 87 67 85 71 81 Supervision 65 67 65 61 74 71 60 74 57 79 57 60 Benefit 70 72 70 64 82 73 69 81 59 62 63 75 Reward Operating 73 79 74 69 79 83 71 83 70 68 68 73 Condition 77 79 75 76 85 74 88 85 76 65 72 80 Coworkers 87 75 80 80 89 78 84 83 79 76 75 Nature of work 78 76 77 69 82 74 81 82 65 78 67 79 Communication 75 Average 73 77 70 71 81 77 73 80 69 72 67 74 Gender Employee Engagement Career Development
Age Range (Year)
L
P
2125
2630
3640
4145
>46
76
68
77
75
74
71
68
Work Duration (Year) 1< 2< 3< t t t≤ t≤ t≤ >4 ≤1 2 3 4 81
70
79
63
75
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Training Leadership Work Environment Recognition Alignment Management Infrastructure Performance Measurement Communication Average
72 81
71 80
69 82
69 80
77 83
78 82
71 76
75 90
63 79
76 89
71 70
76 70
80
74
77
82
75
74
81
85
70
87
70
79
66 73 79 73
73 76 82 74
67 69 75 70
62 76 82 75
72 79 78 70
72 75 80 75
73 67 90 83
78 85 84 78
56 68 74 76
59 56 89 78
64 70 73 63
68 68 83 74
73
75
72
76
69
73
79
76
66
88
70
73
67 74
67 74
69 73
63 74
65 74
68 75
73 76
72 80
62 68
56 76
64 68
70 74
Gender Organizational Commitment Affective Commitment Continuance Commitment Normative Commitment Average
Age Range (Year)
Work Duration (Year) 1< 2< 3< t t ≤1 t ≤ t ≤ t ≤ >4 2 3 4
L
P
2125
2630
3640
4145
>46
74
75
74
76
75
77
67
81
66
64
73
77
61
64
58
64
56
66
63
60
56
63
64
68
69
68
72
70
61
67
74
67
60
74
72
77
68
69
68
70
64
70
68
69
61
67
69
74
The average results from this study are also arranged based on the demography of the participants in Table 3, and all these three conditions appear to be moderately consistent despite the gender of the participants. On the other hand, the age and work duration show a certain degree of variation in the results. In job satisfaction, the three least satisfied factors are pay, benefits, and rewards, especially in the 21-30 years old age group. Therefore, the new system that offers a higher commission rate has not yet been effectively experienced by majority of the brokers in XMG. Also, with the increase number of brokers, the management needs to concern the maximum capacity of rooms, facilities, and all the other benefits provided in the office because when the number exceeds the capacity, they will experience greater discomfort and become more dissatisfied. Lastly, reward program offered for brokers is held for the period of 1 year with high target. This can potentially cause a great dissatisfaction when a broker failed to achieve the target despite already working so hard in that year. Therefore, it is recommended to have a shorter-term reward program to allow the brokers to strive for moderate target and thus, their confidence can grow to achieve higher target. In employee engagement, majority of the factors, 7 out of 10, appear to have moderately high levels, and only 3 factors have high levels. This result indicates that majority of brokers in XMG have yet to fully engage in their work. One of the potential reason is due to the sudden increase of new recruits in the beginning of the year that the leaders of company focus mainly in supervising and training the new brokers. As shown in Table 3, the variance in engagement based on the work duration is higher in comparison to other demography factors. Hence, the leaders of XMG have to develop a schedule to build and maintain personal, one-on-one relationship with every broker in the company so that each of them can have the sense of belonging and then be more engaging in the office.
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In organizational commitment, real estate broker is generally perceived as a part-time job so the moderately high commitment level is as expected for this profession. The highest commitment is seen in the affective category, especially those who have worked in XMG less than 1 year as shown in Table 3. The affective commitment level drops after 1 year because these brokers have become less dependent on the leaders to train and help teaching them. On the other hand, continuance and normative commitment starts lower in the beginning of their career and then increase over time. Lower commitment can potentially lead to high turnover rate. In order to raise the commitment level in the beginning of career, XMG can filter out applicants by asking them to pay an investment to join the initial training program. Therefore, only those who are serious will apply for the job and they will have higher motivation to earn their investment back. Also, this will prevent them to resign at the early stage of their career. H.L. Kaila (2015) in “Organizational Psychology” also quotes Herzberg’s Two-Factor theory that financial income can remove employee’s dissatisfaction, but doesn’t automatically improve the satisfaction level. Therefore, even though real estate brokers have achieved their financial target, the theory suggests that at the very best they will not feel dissatisfied. Locke’s Value Theory in Job Satisfaction (Kaila, 2015) also appears to be varying in different age group because the young brokers might have higher ambition and idealism. When they did not achieve the expected value, then their satisfaction level decreases.
CONCULSION This study has successfully provided a detail description on the internal conditions of job satisfaction, employee engagement, and organizational commitment in XMG real estate brokers. In job satisfaction, the result shows average 74% (moderately high) with the highest average in the nature of work and the lowest in income. The participants also show 74% average in employee engagement with the highest in leadership factor and the lowest in communication. Lastly, the organizational commitment shows 68% average with the highest in affective commitment and the lowest in continuance commitment. All these three conditions are appeared to have a moderately high level so the management of XMG has managed the company well in the past, and in order to improve the recruitment and retention rate, some specific areas need urgent attention such as remuneration system in job satisfaction, communication in engagement, and retention through continuance commitment. REFERENCES Cullinan et al. (2008) ‘Organization-Harm vs. Organization- Gain Ethical Issues: An Exploratory Examination of the Effects of Organizational Commitment’, Journal of Business Ethics, 80, pp. 225-235. Goetz et al. (2015) ‘Working Atmosphere and Job Satisfaction of Health Care Staff in Kenya: An Exploratory Study’, BioMed Research International. Kaila, H.L. (2015) Organizational Psychology. New Delhi: I.K. International Publishing House Pvt. Ltd. Kular et al. (2008) Employee Engagement: A Literature Review. London: Kingston Business School. Saks, A.M. (2006) ‘Antecedents and Consequences of Employee Engagement’, Journal of Managerial Psychology, 21(7), pp. 600-619. Sarwono, J (2006) Metode Penelitian Kuantitatif dan Kualitatif. Jogjakarta: Graha Ilmu Sugiyono (2015) Metode Penelitian dan Pengembangan. Bandung: Alfabeta Vaksalla, A. & Hashimah, I. (2015) ‘How Hope, Personal Growth Initiative and Meaning in Life Predict Work Engagement Among Nurses in Malaysia Private Hospitals’, International Journal of Arts & Sciences, 08(02), pp. 321-378.
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THE EFFECTS OF PRODUCT QUALITY AND SERVICE QUALITY ON LOENPIA NYONYA GIOK’S CONSUMERS SATISFACTION IN PTC 1
Eduardo Sugiarto
Ciputra University Surabaya INDONESIA Email:
[email protected] ABSTRACT The purpose of this research is to find out the effects of product quality and service quality of Loenpia Nyonya Giok’s consumers satisfaction. There are two methods of data collection in this research. First, direct observation where the researcher observes events and conditions in research object. Second, documentation where the researcher collects questionnaire to 88 random respondents. Data processing method is statistical method where the researcher uses multiple linear regression analysis. Population of this research is consumer of Loenpia Nyonya Giok, while purposive sampling method is used to determine the sample size, which is 88 respondents. The research shows that based on the t-test, product quality has significant at 0.000 < 0.05, so the product quality affects Loenpia Nyonya Giok’s customer satisfication. Next, the t-test shows that service quality is significant at of Loenpia Nyonya Giok’s customer satisfaction showed significant result at 0.003 < 0.05, so service quality affects Loenpia Nyonya Giok’s customer satisfication. Keywords: Product Quality, Service Quality, Customer Satisfaction.
INTRODUCTION Business is an activity where a company offers goods or services to meet consumer needs. Food business is one of business activities that everyone desperately needs, even supported by the growing number of culinary businesses in Surabaya. These have motivated all business entrepreneurs to innovate both in the form of products, packaging, and marketing ways. Innovation is required in business word from time to time, to enable the business to adjust with society developments as well as to meet consumer needs. Product quality and service also influence the level of costumer’s satisfaction in buying a product. Kotler and Armstrong (2014: 28-29) state that product and service quality, customer satisfaction, and corporate profitability are three things that are closely tied together. Product and service quality themselves have a very important role in achieving the level of customer’s satisfaction in a business. According to Statistics of Surabaya Municipality, the number of culinary businesses in Surabaya has increased; therefore, many entrepreneurs are now competing to improve their product and service quality in order to survive in this increasingly fierce business competition. Loenpia Nyonya Giok is a food and beverage business established in 2003 in Surabaya. This business focuses on snacks, with products such as spring rolls, risoles, croquettes, and solo sausages. Since its establishment, many similar products or even replacement products have constantly emerged. This business sells its products directly to its consumers and owns several
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branches spread in Surabaya, which are in Kedungdoro street, Gwalk-Citraland, Royal Plaza Mall, Surabaya Wholesale Center, Pakuwon Trade Center, Pasar Atom Mall, and Ranch Market Galaxy Mall. Promotions are done through online and printed promotion as well as partnering with Go-Food and Go-Jek. In terms of product and service quality, Loenpia Nyonya Giok always tries to give the best for its consumers, with expectation for them to repurchase the products. The objectives of this are: 1. to find out how significant product quality influences customer’s satisfaction for Loenpia Nyonya Giok in PTC. 2. to find out how significant service quality influences customer’s satisfaction for Loenpia Nyonya Giok in PTC. 3. to find out how significant product and service quality simultaneously influence customer’s satisfaction for Loenpia Nyonya Giok in PTC. LITERATURE REVIEW Some related literatures are used as references for this research. The first research is from Tronvoll (2012) on the model of consumer behavior from a service point of view. This research aimed to propose conceptual model derived from consumer complaints as a dynamic process in accorandce with the service, by examining general behavioral model from consumer complaints in relation to the perspective of service logic, in order to describe the dynamic concept of service. The results of this research were models in three categories of behavior in consumer’s complaints, namely no complaining response, communication complaining responses, and action complaining responses. The second research is from Djekic, et al., (2016) entitled Cross-Cultural Consumer Perceptions of Service Quality in Restaurants. This research aimed to present the results of research on analyzing consumers’ perceptions towards restaurant service quality in four European cities, namely Serbia, United Kingdom, Greece and Portugal. This research was quantitative in nature with questionnaire as technique of data colletion. The questionnaire was distributed to 802 respondents, selected randomly in those four cities. The result reveals that service and food quality were the most influential factors with two other supporting factors, location and interior. The third research is from Bujisic, Hutchinson and Parsa (2014) entitled The Effects of Restaurant Quality Attributes on Customer Behavioral Intentions, with aim to examine the relationship between restaurant quality and consumer behavior. This research used experimental design on two different restaurants, and the findings later revealed that type of restaurant influenced consumer behavior. RESEARCH METHODS This research used causality research design with quantitative approach. According to Sanusi (2011: 14), causal research design is a research designed to examine the possibility of causal relationships between variables. According to Cooper and Schindler in Indrawati (2015: 184), quantitative research approach attempts accurately measure behavior, opinions, and attitudes. The author chose causal research design since this research examined the effect of product quality and service (independent variables) on customer satisfaction’s level (dependent variable) for Loenpia Nyonya Giok. Sanusi (2011: 87) states that population is all components of an element with certain characteristics used to draw conclusions. Population of this research was all consumers of Loenpia Nyonya Giok who purchased the product at Pakuwon Trade Center Surabaya branch, with the average number of consumers as much as 720 people per month. Indrawati (2015: 169) explains that non-probability sampling is a sampling technique that does not allow all population members to have an equal chance to be selected as research sample, and
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Putra (2013: 69) describes purposive sampling as samples selected with a specific purpose that must be explained by researcher to his or her informants before conducting research. Purposive sampling technique was used in this study since the entire population had been recognized and was expected to add validity for the research results. According to Sanusi (2011: 104), the data source is divided into two as follows: 1. primary data source, where the data are first noted and obtained by the researcher so its accuracy and validity are guaranteed. The author used questionnaire to gather data in this research. 2. Secondary data sources, where the data already exist and be obtained by other parties. Secondary data are usually take form of literature and related previous research articles. The number of population for this research was 720, obtained from the average number of visitors per month, with a tolerance limit of 10% (0.1) and formulated as follows: n=
720 1 + (720 (0.12))
= 87.8
Based on the above calculation, the sample size used in this research was 87.8, rounded up to 88. FINDINGS AND DISCUSSIONS 1. Validity and Reliability Test Utama and Mahadewi (2014: 140) explain a measurement scale as valid if the scale is used to measure what supposed to be measured. Validity test is used to find out whether the question on a questionnaire is able to uncover something that is measured by that questionnaire. Questions can be said as valid if the Pearson correlation sig is lesser than 0.05. The followings are the results of validity test for product quality (X1) and service quality (X1) and customer satisfaction (Y). Results of data processing showed that the entire independent and dependent variables were valid since the sigs were lesser than <0.05.
No. 1.
2.
3.
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Table 1. Validity Test Instrument Sig. Level (2-tailed) Product quality X1.1 0.001 X1.2 0.003 X1.3 0.000 X1.4 0.000 X1.5 0.000 X1.6 0.038 X1.7 0.000 Service quality X2.1 0.001 X2.2 0.000 X2.3 0.000 X2.4 0.000 X2.5 0.000 X2.6 0.000 X2.7 0.000 X2.8 0.017 X2.9 0.004 Consumer satisfaction Y1.1 0.000 Y1.2 0.000 Variable
Conclusion Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid Valid
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Y1.3 Y1.4 Y1.5 Y1.6 Y1.7 Y1.8
0.009 0.000 0.000 0.000 0.001 0.001
Valid Valid Valid Valid Valid Valid
Table 2. Reliability Test Variable Cronbach’s Alpha Product quality (X1) 0.706 Service quality (X2) 0.810 Consumer’s satisfaction (Y) 0.812 Reliability test is a measuring tool that is used consistently and can give the same information results when used repeatedly (Ghozali, 2013: 42). In this research, reliability test was done by using Cronbach’s alpha. The results showed that Cronbach’s alpha value for each variable was greater than 0.6 so that it is concluded that the results of SPSS is reliable (Ghozali & Priest, 2013: 42). 2. Classic Assumption Test Table 3. Normality Test One-Sample Kolmogorov-Smirnov Normality Test Unstandardized Residual N 88 Normal Parameters a,b Mean 0.0000000 Std. 2.07911878 Deviation Most Extreme Differences Absolute 0.098 Positive 0.084 Negative -0.098 Test Statistic 0.098 Asymp. Sig. (2-tailed) 0.036c a. Test distribution is Normal. b. Calculated from data. c. Lilliefors Significance Correction.
Normality test was done to find out whether the regression model had normal distribution or not. This test used Kolmogorov-Smirnov and the result was 0.036. Table 4. Heteroscedasticity Test Coefficientsa
Model 1 (Constant) x1total
Standardized Unstandardized Coefficients Coefficients B Std. Error Beta -2.074 1.148 0.125 0.052 0.299
t -1.807 2.412
Sig. 0.074 0.018
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x2total
0.035
0.046
0.094
0.758
0.451
Heteroscedasticity test was performed to indicate that the presence or absence of residual variants was different from that of another observation, by using spearman correlation with SPSS system. The result showed that there was no heteroscedasticity since the result obtained was greater than 0.05. Table 5. Linearity Test (X1) ANOVA Table
ytotal x1total
* Between Groups
(Combined) Linearity Deviation Linearity Within Groups Total
from
Sum of Mean Squares Df Square 333.183 13 25.629 289.806 1 289.806
F Sig. 4.531 0.000 51.240 0.000
43.377
12 3.615
0.639
418.533 751.716
74 5.656 87
0.802
Table 6. Linearity Test (X2) ANOVA Table
ytotal x2total
* Between Groups
(Combined) Linearity Deviation Linearity Within Groups Total
from
Sum of Squares Df 398.549 14 302.173 1
Mean Square F Sig. 28.468 5.884 0.000 302.173 62.459 0.000
96.377
13
7.414
353.167 73 751.716 87
4.838
1.532
0.126
Linearity test was performed to state that the relationship between one dependent variable and the independent variable was linear. In SPSS processing results, it was shown that X1 to Y had a linearity of 0.000 and devitation from linearity was 0.802. For the results of X2 to Y, the linearity was 0.000 and devitation from linearity was 0.126. It is concluded that X1 and X2 are linear to Y. Table 7. Multicolinearity Test a Coefficients Collinearity Statistics Model Tolerance VIF 1 x1total 0.668 1.498 x2total 0.668 1.498 a. Dependent Variable: ytotal
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Multicollinearity test aimed to test whether there is a relationship between independent variables. The test used Variance Inflation Factor (VIF), and the results of SPSS showed X1 was 1.498 and X2 was 1.498, and the results of X 1 and X 2 were not greater than 10. Thus it is concluded that there is no multicolinearity. Table 8. Autocorrelation Test Model Summaryb Std. Error of the Estimate Durbin-Watson 2.10344 2.146
Model R R Square Adjusted R Square a 1 0.707 0.500 0.488 a. Predictors: (Constant), x2total, x1total b. Dependent Variable: ytotal
Autocorrelation test aimed to determine whether multiple linear regression model had correlation between residual observations. This test used Durbin Watson test and the auto correlation did not happen if dU < dW <4-dU met. After processing the data in SPSS software, it was seen that Durbin Watson was 2,146 and when calculated using aforementioned condition, then 1.6999 < 2146 < 2.3001 or the autocorrelation did not happen. 3. Multiple Linear Regression Analysis Table 9. Multiple Linear Regression Analysis Coefficientsa Unstandardized Coefficients Model B Std. Error 1 (Constant) 0.686 0.244 x1rata 0.524 0.093 x2rata 0.268 0.086 a. Dependent Variable: yrata
Standardized Coefficients Beta
t 2.809 5.608 3.113
0.530 0.294
Sig. 0.006 0.000 0.003
Based on the data (Y = 0.686 + 0.524 X1 + 0.268 X2 + e) it is concluded that the regression coefficient value of product quality variable equal to 0.524 is positive value with sig value 0.000, so it can be said that product quality variable has effect on consumer satisfaction. The greater the product quality, the greater the consumers’ satisfaction towards the product. Later, the coefficient of service quality is 0.268 which has positive value with sig 0.003. Hence, it can be said that service quality variable has effect on consumer satisfaction. The better the service the quality, the greater the consumers’ satisfaction. T-test was performed to compare whether there was a partial relation to the two independent variables being similar or different. Based on SPSS test results, the result of X1 sig value was 0.000 and the X2 sig value was 0.003. It is concluded that the relationship between independent variables has partial effect. 4. F Test Table 10. F Test ANOVAa Model
Sum Squares
of df
Mean Square
F
Sig.
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1
Regression 7.006 2 Residual 5.213 85 Total 12.219 87 a. Dependent Variable: yrata b. Predictors: (Constant), x2rata, x1rata
3.503 0.061
57.120
0.000b
F test was used to test the effect of independent variables on the dependent variable simultaneously. Data processing result from SPSS showed the sig. value was 0.000, thus it can be concluded that independent variables have simultaneous effect on dependent variable.
5. Correlation Coefficient Test (R) and Determination (R2) Table 11. Correlation Test (R) and Determination (R2) Model Summary Model R R Square Adjusted R Square a 1 0.757 0.573 0.563 a. Predictors: (Constant), x2rata, x1rata
Std. Error of the Estimate 0.24764
According to Susetyo (2010: 115), correlation coefficient is a number that indicates the high level of relationship between two or more variables. Multiple linear correlation only limits its discussion on the relationship between two variables. Correlation coefficient (R) is the level of relationship closeness between independent variables with dependent variables with value from 0 to 1. In this research, the R value was 0.757 so it can be said that independent variables are tied up with dependent variable. According to Sugiyono (2011: 153), coefficient determination (R2) measures how capable a model explains variation of dependent variable with coefficient value from 0 to 1. The result showed that the value was 0.573 which means that the independent variables, namely product quality (X1) and service quality (X2) have percentage of 57.3%, while the other 42.7% is explained by other variables which are not discussed in this research. Discussions Based on t-test done in SPSS, the effect of product quality (X1) on consumer satisfaction (Y) was 0.000, lesser than 0.05. According to Kotler and Armstrong (2012: 283), product quality is the ability of a product to demonstrate its functions and benefits to consumers, including its overall durability, reliability, accuracy, ease of operation and reparation. Based on the data and theory it can be concluded that the product quality (X1) has partial effect on consumers’ satisfaction (Y) for Loenpia Nyonya Giok’s product (in PTC). Next, the effect of service quality (X2) of consumer’s satisfaction (Y) was 0.003 or lesser than 0.05. According to Khan and Fasih (2014), service quality influences consumer’s satisfaction. If the service provided by a company is very good, consumer’s satisfaction will arise. On the other hand, if the service receivedis poor, consumers will find other company with service that meet their expectation. Based on the data and theory, it can be concluded that service quality (X2) has partial effect on consumers’ satisfaction (Y) for Loenpia Nyonya Giok’s product (in PTC). The results of F test performed with SPSS showed that the value was 0.000 or lesser than 0.05, so it can be concluded that product quality (X1) and service quality (X2) as independent variables have simultanoues effects on consumer satisfaction (Y). These results are consistent with past research conducted by Djekic, et al., (2016), entitled Cross-Cultural Consumer
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Perceptions of Service Quality in Restaurants that proves that service quality and food quality are main factors that affect consumers’ satisfaction. Table 12. Research Implications
CONCLUSIONS AND SUGGESTIONS Based on the research results, it can be concluded that produt quality has partially positive effect on consumers’ satisfaction for the product of Loenpia Nyonya Giok (in PTC). Since the sig value was 0.000 or lesser than 0.05, the first hypothesis of this research was accepted. Next, service quality also has partially positive effect on consumers’ satisfaction for the product. Result of significance test or t-test can be seen that service quality partially have positive effect to customer satisfaction in Loenpia Nyonya Giok (PTC). Since the sig value was 0.003 or lesser than 0.05, it can be concluded that the second hypothesis of this research was also accepted. Lastly, product quality and service quality have simultaneously positive effects on consumers’ satisfaction for the product of Loenpia Nyonya Giok (in PTC), as seen from the sig value of 0.000 or lesser than 0.05. Therefore, it can also be concluded that the third hypothesis of this research was accepted as well. For Loenpia Nyonya Giok, in order to improve and maintain the quality of its existing products, the company needs to add more varied menu by considering consumers’ tastes, improve service quality to make consumers satisfied with the services provided, and pay attention to the employees’ appearance to maintain the company standard of neatness and cleanliness. REFERENCES Ghozali, and Imam. 2013. Aplikasi Analisis Multivariate Dengan Program SPSS Edisi Ketujuh. Semarang: Penerbit Universitas Diponegoro Indrawati. 2015. Metode Penelitian Manajemen and Bisnis: Konvergensi Teknologi Komunikasi and Informasi. Bandung: PT. Refika Aditama Kotler, P., and Armstrong, G. 2012. Prinsip-prinsip Pemasaran. Edisi 13. Jakarta: Erlangga ___________________, G. 2014. Principles of marketing (15th Edition). New Jersey: Pearson Putra, Nusa. 2013. Metode Penelitian Kualitatif Manajemen. Jakarta: PT. Raja Grafindo Perkasa 52 Sanusi, Anwar. 2011. Metode Penelitian Bisnis. Jakarta: Penerbit Salemba Empat Sugiyono, 2011. Metode Penelitian Kuantitatif, Kualitatif, and R&D Edisi 14. Bandung: Alfabeta ________, 2011. Metode Penelitian Kuantitatif, Kualitatif, and R&D Edisi 14. Bandung: Alfabeta
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Susetyo Budi, 2010. Statistika Untuk Analisis Data Penelitian. Bandung: PT Refika Aditama Utama, I. G., and Mahadewi, N. M. (2012). Metode Penelitian pariwisata & Perhotelan. Yogyakarta: Penerbit Andi. Utami, W. Christina. 2012. Manajemen Ritel: Strategi and Implementasi Ritel Modern Edisi 2. Jakarta: Salemba Empat
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RISK MANAGEMENT ANALYSIS IN DETERMINING THE LEVEL OF TRUST OF THE CLIENTS WHO USES THE DELIVERY OF GOODS THROUGH ONLINE APPLICATION. (A CASE STUDY OF DELIVERY SERVICE USING GO-SEND) 1
Alexander Wirapraja, 2Imam Wijoyo STIE IBMT Surabaya INDONESIA
E-mail :
[email protected],
[email protected] ABSTRACT Nowadays the development in the modern era is fast and it has not been realized that it has changed the pattern of the lifestyle of the society, so that the companies which provide service have to change the pattern of their sales service to become instant service. And in order to fulfill the need of fast service in Indonesia, a new way of delivering goods has been presented and this is also considered a new inovation in sending goods within the city. People can make use of Go-Send application. Because of it, goods can be delivered in shorter time or faster when compared to other transportation companies. The problem in this research is how to analyse the risk in using the application so that in the end, the result that is expected is to increase the trust from the customers. The methodology used is by the literature review. In collecting the data, the writer uses emphirical research sources. It is done by collecting the data and information related to the system of delivering the goods. The sources are from national and international research journals, books, newspaper, and magazines. Results of the research are the risk management analysis in using Go-Send application so that the objectives that is going to be achieved is to increase the customers’ trust. Key words : Go-Send, Customers’ trust, Risk Management INTRODUCTION Nowadays the developement in the modern era is fast and it has not been realized that it has changed the pattern of lifestyle of the society. This has forced companies which provide service to change their way of sales service to become instant and fast service in order to fulfill those needs. Life style pattern is seen and taken by the transportation business “players” or particularl by the business in delivering the goods. Widagdo (2012) defines transportation or delivery service is the mutual agreement between the carrier and the sender, where the carrier is bound himself to organize and to carry the goods and/or passanger from one place to certain destination safely, whereas the sender bounds himself to pay transportation fee. Regarding the progress in tranportation, not long ago, precisely early 2015, in Indonesia there has been a new model of transportation called Go-Jek which is under a company called P.T. (Private-Limited) Go-Jek Indonesia. In the application of Go-Jek, there is a delivery or transportation service for sending goods called Go-Send. Go-Send is also a new inovation in sending goods, because it can deliver goods in a faster way when compared to other transportation company. In its development, transportation or delivery of goods especially for delivery of goods or documents in short distance, consumers are given alternatives to use the service that can be
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accessed and tracked or seen on line through private cell-phones. The application can be used easily. It is used by the input of data such as the address where the goods are to be taken and the destination address, all of which are connected through GPS (Global Positioning System), then customers are asked to give the details of the goods, all information are needed including the point of departure address and destination address. The application will automatically search for the courrier whose position is at the nearest location to the sender, and when the courier is found, the application will directly inform the details to the clients or customers’ cell phones. And customers will be waiting for the confirmation from the selected courier about the goods that is being sent. When the courier arrives, the client or customer just has to wait, until the goods is already in the agreed destination written on the application and of course the tarif charged to the customer has been arranged by the application according to the distance that has been done until to the destination when the process of the deliver has been done. Considering sometimes the urgent needs and the importance of understanding the risk that is going to happen to the goods or documents that are being sent are important; therefore, the aspect of risk management becomes the main principles in this process. In this case, the level of courier’s honesty is at stake in doing the process from the beginning until the end result. What is expected is the level of trust from the customers or clients so that they will repeat the transactions using the application again. LITERATURE REVIEW The Definition of Delivery Service The understanding of delivery service according to Kamus Besar Bahasa Indonesia (KBBI) or Indonesian Language Big Dictionary, the word delivery comes from the word deliver or “kirim” and it means to send or to deliver. It is a process or way of sending something using the middle man or courier. Whereas another definition of delivery service of goods according to Moenir (2014) is the activity that is done by someone or a group of people on the basis of materical factor that is done through system, procedures, and certain methods with the objective to fulfill other people’s interest and intention according to his/her right. During the process of delivery, the fee or the tariff is decided based on several factors which is stated by Salim (2006) which is: the delivery tariff is a list that contains prices for all the users of transportation service that is arranged regularly. The burden of the price is calculated according to what the traffic will bear. The applicable tariff types that exist can be grouped as follows: 1. Tariff by routes is tariffs based on transport routes according to operational ulitization and transport mode operated by taking into account the distance served by the local transport modes. (km/miles) 2. Local Tariff is the tariff applicable to certain region. For example, the bus tarrif that is only applicable particularl in DKI Jakarta. 3. Differential Tariff is the freight rates where there are differences in tariff rates by distance, weight of charge, speed or the special nature of the transported load. 4. Container tariff is the rate applied to carry the box /container on the truck based on the size of the box/container picked up. The container tariff is also known as COFC (Container on Flat Car). Definition of Risk According to Lokabal (2014), risk is something that leads to uncertainty over the occurence of an event over a certain period of time in which the event causes a loss, whether it is a minor loss that is not meaningful or a major loss that affects the survival of a company. Risk in general is seen as something negative, such as loss, danger, and other consequences. The loss is the form of uncertainty that should be understood and should be managed
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effectively by the organization as part of its strategy, so that in the end as the result, risk management can add to more value and can be used to achieve the organization’s goal. Risk management according to Hidayat (2015) is an attempt to know, to analyze, as well as to control risk in each company’s activity with the aim of obtaining higher effectiveness and efficiency. The following things are things related to risk: 1. Uncertainly about something 2. Undesirable events 3. Something that goes beyond original purpose 4. Possible adverse events The meaning of Data and Information The meaning of data according to Kamus Besar Bahasa Indonesia (KBBI), the Big Indonesian Language Dictionary, is the explanation or real material that can be used to analyze the material or conclusions. According to Turban (2010), data is the basic description of things, events, activity, and recorded transactions, that are grouped and kept but not yet organized. They will be used to convey certain meanings or purposes. Based on the data collection, data can be differentiated into two kinds of data which is primary data and secondary data. Primary data is the data that is obtained or collected by people who have done the research or the concerned people need it. Primary data can be called as original data, or new data. Whereas the secondary data is the data that is obtained and collected from available and sources, this data can be obtained from library or from reports or documents from previous research. Secondary data can be called as existing data or available data. The meaning of information according to experts is firstly the understanding of information according to O’Brien (2010), is the data that has been changed into context that has meaning and useful for certain end users. Second is the understanding about information according to Turban (2010), it is the data that has been organized and that’s why it has meaning and value for the receiver of the data. In the above research McLeod (2009) stated that there are 4 dimensions of information which are: 1. Relevance Information is considered relevance if it is relevan and related to the problem that is being faced. 2. Accuracy Information that is available must be accurate and can be used as the long-term economic forecast, and statistical reports. 3. Punctuality Information should be available in order to make decision before the existing problem is developing or the disappearance of opportunity, the users should be able to obtain information that can unravel or solve the problem that is happening at the moment. 4. Completeness Users should be able to obtain information that provide a complete picture or image on certain problems as well as to provide alternative solutions. Customers’ Trust Customers’ trust according to Mowen (2002) is the knowledge that is owned by the customers and all the conclusion that is made by customers or consumers about objects, its attributes, andits benefits. What is meant by object in this research are in the form of products, people, and everything where someone put the trust and attitude towards them. Kinds of trust There are 3 (three) kinds of trust according to Mowen (2002) which are: a. Object attribute trust
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The knowledge about an object has certain special attribute which is called object attribute trust. Object attribute trust relates or connects an attribute to the object, such as someone, goods, or service. Through object attribute trust, consumers or customers state what they know about something about the variation of its attribute. b. Attribute benefit trust Someone searches products or services that can solve the problem and can fulfill his/her needs or in other words, the products or services have attributes that will give benefits that can be recognized. The connection or relation between attributes and benefits describes the second kind of trust. Attribute benefit trust is the consumer’s or customer’s perception of how far certain attributes produce or deliver certain benefits. c. Trust the benefit of the object The third kind of trust is formed by connecting the object and its benefits. Trust the benefit of the object is the customers’ perception about how far the products, people, or certain services will be giving certain benefits. RESEARCH METHODS The approach that is used is literature review. In the process of collecting the data, the writer uses Literature Review by collecting data and information related to the system of transportation of goods. The source is from research journals, whether from national research journal as well as international research journal, text books , newspaper, and magazine. Cooper in Creswell (2010) explains that literature review has several objectives which are to inform to its readers the results of other researches that is closely related to the current research at the moment, it alsoconnects the research with availabe literature and at the same time it is also filling in the gaps of previous researches. Literature review contains reviews, summary, and writer’s thought, or ideas about several literature resources (articles, books, slides, information from internet, and et cetera) about the topic that is being discussed, This literature study aims to obtain an several analysis of the possible risks that may occur in the process of delivery from order receipt to completion the delivery process DISCUSSION The shifting of the lifestyle of Indonesian society and the ever-increasing technological development resulted in the increasingly unstoppable use of the internet and the shifting population that tends to use mobile phones can be seen based on the data from the Indonesian Internet Service Providers Association (APJII) year 2016 which states that the amount of 63.1 million population or 47.5% like to use mobile gadget in doing the internet access and 67.2% or 50.7% uses mobile and computer in doing the internet access. Table 1. Behavior of internet users in Indonesia No
Device 1 2 3
Mobile Mobile & Computer Computer
Total user (Million) 63.1 67.2
Percentage (%) 47,6 50,7
2.2
1,7
Source : APJII, Processed by researchers Apart from the dependency in the use of electronic devise, it can be redefined what content is often accessed based on the data from APJII year 2016. Above 90%, the content that
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is frequently accessed are social media content, entertainment, news, education, commercial, and public service such as written on the table Table 2, Contents accessed by internet users in Indonesia in year 2016 No Contents Total (Million) Percentage (%) 1 Social Media 129,2 97,4 2 Entertainment 128,4 96,8 3 News 127,9 96,4 4 Education 124,4 93,8 5 Commercials 123,5 93,1 6 Public 121,5 91,6 Service Source : APJII, Processed by researchers Experience is something that is able to create positive attitude towards customers, causing a sense of satisfaction, or customers’ satisfaction, in addition to the positive feelings built on a particular product or brand, experience will build customer trust. Mowen and Minor (2002) states that consumers’ trust is all the knowledge that is owned by the consumers and all the conclusion made by the consumers/customers about the object, attribute, and benefits. Trust is the cognitive knowledge of an object, then attitude is a feeling or affective response that is owned about the object. Consumers or customers will form trust in a product and then develop an attitude. If the attitude is positive, there will be loyalty to the product or brand. How to form customer trust as revealed by Morgan and Hunt (1994) outlines that trust is a key variable in developing a long lasting desire to continue maintaining long term relationships. Trust will build consumers’ perception, whether the brand has integrity, competence, and benevolence, and others that will affect attitudes and behavior. Customer trust is considered to be able to affect the image and cause the customer to have a high sense of loyalty towards Go-Send. This is reinforced by Bloemer and Schroeder (2002) who found that trust influences commitment and commitment influences word of mouth (WOM), repurchase intention and price intensity. Garbarino and Johnson (1999) found that trust influence customer commitment and trust and customer commitment influence future intention. As one of the commercial services, Go-Send is one of the features in Go-Jek application developed by P.T. Go-Jek Indonesia where the role and the important task is to carry the concept of Personal Online Booking (POB) in delivering goods and document quickly which is in less than 3 (three) hours time and to any destination as long as they are still in the same city. Although it carries the concepts of Instant Courier) the payment rate charged to the user is based on the distance or proximity of the distance indicated on the application so that the courier can not determine by himself the delivery rate that will be charged to the user. The concept of E-commerce that is carried by Go-Send is to use the concept of business to customer (B2C) where each feature and electronic transactions that occur through the GoSend application features which is accessed through Go-Jek features is being supervised directly by P.T. Go-Jek Indonesia. This is proved by the existence of some terms and conditions that must be fulfilled by the user in utilizing the application and as a step by P.T. Go-Jek Indonesia itself in minimalizing the possibility of the risk to happen. The terms listed on the official page of P.T. Go-Jek Indonesia regarding the terms of delivery of goods through Go-Send feature is as follows: 1. Customers must provide complete and accurate information about the kind of goods to be delivered.
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2. Go-Send does not provide special box for delivery and customers is responsible to pack the goods which is going to be delivered. Special packaging and wrapping is suggested for the fragile or non-durable items such as cakes, ice-cream, food, and fresh flowers. Go-Send shall not be liable for any damages or alterations that may occur upon the delivery of such goods. 3. Go-Send will do the taking of the goods and make the shipment and delivery of the goods on the same day with the estimated delivery time up to 3 (three) hours since the goods were taken. 4. Go-Send will not cater the delivery service for the following item: a. Goods prohibited by the authority to be owned or to be circulated. b. Animals and real plants. c. Things that are dangerous, flammable, smell , and stink need special handling. d. Things or goods that its dimension should not exceed the length of 70 cm (length), 50 cm x 50 cm width, 50 cm height or goods that do not weight more than 20 kgs. While Go-Jek on its official page itself is willing to provide compensation in case of the unexpected things happen during the delivery of goods or documents through Go-Send features by providing insurance that can be used by users by following the terms and conditions as under: 1. Make sure the user fills in the item description column clearly and correctly because replacement of damaged or missing items will be based on the note in that column. 2. The amount of replacement will be based on the price of normal goods on the market. 3. The insurance provided will be maximumly Rp 10.000.000,-4. If the goods are damaged, the user must store the goods immediately and report to Go-Send call center (021-5025-1110) right way within the maximum period of 48 hours after delivery is done. Some steps to implement Risk Management for delivery of goods or documents that can be applied by P.T. Go-Jek Indoensia on its Go-Send feature through the writer’s analyazis which in to follow langkah-langkah di bawah ini: 1. Mistake on the delivery destination The risk that usually happens is a mistake on the destination of delivery. In order to anticipate this, then the user is asked to fill out the retrieval address and the destination address completely and the user will receive confirmation from Go-Send driver who will take the item or the document. During the process of shipping or the process of taking the goods / documents, the user can monitor or can track through Go-Jek application on users’ private cell phone , so that the last position of the driver can be seen whether the paths or routes are in accordance with the route or path that is determined by the application or the driver goes through alternative path or route, or driver does not reach the desired destination. 2. Human Resource Management In recruiting the driver, P.T. Go-Jek Indonesia is recruiting through the media on the official page of P.T. Go-Jek’s web site and the driver candidate can fill out the available column and P.T. Go-Jek Indonesia will make a call if it is necessary for recruiting the prospective driver.The requirement to register to be a driver is that the potential driver is asked to complete the various requirement as below 1. Has motorcycle which is manufactured above year 2011 2. Has valid ID (KTP) 3. Has valid driving license type C (SIM C) 4. Has motor vehicle registration (STNK)
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5. Hasr valid good behavior statement (SKCK) , the original or legalized one 6. Is able to work 10 hours per day and 5 days in a week. 7. Preferable the age is below 35 year-old 8. Cell Phone RAM at minimum is 1 Giga Byte 9. Cell Phone screen is minimum 5 inch And for drivers who have registered to be Go-Jek drivers, P.T. Go-Jek is obligated to provide rules that must be followed by the driver along with the sanctions if they violate the rules and P.T. Go-Jek also explains the task analysis, job descriptions, benefits and obligation by Go-Jek drivers. Go-Jek also has provided the procedure or (Standard Operating Procedure) for the driver from the beginning of the order process up to the end of the order of Go-Send as shown in the picture below:
Figure 1. Go-Send Flow in Go-Jek Driver Application Source : Go-Jek 3. Competition among shipping companies With the increasingly swift era of information and technology, there are also companies that provide similar services, then PT. Go-Jek Indonesia does not want to operate only on a feature, that is Go-Send. In addition to Go-Send feature, there are also other features that can be utilized by users according to the needs and want of the users which are overall available and can be accessed through one Go-Jek application. 4. Damaged to the goods or documents sent P.T. Go-Jek Indonesia has provided the applicable terms and conditions regarding the damage handling procedure that will possibly happen and P.T. Go-Jek Indonesia on its own is willing to give compensation in the form of incurance claim against the damage that happened by the way of reporting to Go-Send call center not more than or maximumly 48 hours after the delivery is done. 5. Theft of goods and documents sent To minimize the risk of the theft of goods that are sent, in Go-Send feature there is application review of the driver along with the commentary fields that can be filled by
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the user if users want to express their disappointment, they can fill in the form and PT. Go-Jek Indonesia is going to examine and investigate and an action by giving strict sanctions to the driver who is perceived to perform the action. 6. System Malfunction If an application erro happens due to the system-error on the user’s phone, the user can re-install it without worrying about losing the data from the last transaction. It can certainly be done by typing in the user’s name and password account and also the cell phone number and email account that has been used for the previous application and the user can do the management and arrange the account through the menu of our own account on Go-Jek application which is accessed through each individual cell-phone. 7. The lost of Electronic gadget (Cell phone) Supposedly the gadget is lost, or the cell-phone of the user is lost, the user still can use the application on the desktop / computer as an alternative for the user to be able to track and trace the condition of the goods or document which is sent. 8. Data Loss One of the way that PT. Go-Jek can do to avoid the loss of the data that can result bigger loss for the company, PT. Go-Jek uses the Cloud computing for server management using the internet as the center of the data server and to process the data, so that all memories of the users and even the soft-ware are not located on the computer but they are all integrated directly by using cloud computing. It is for the purpose that all the memories from users and the software itself is not stored in the computer but it is integrated directly using the cloud system with the medium of computer and it is connected by the internet connection. PT. Go-Jek Indonesia also diligently performs system up-dates and system maintenance periodically to avoid loss of data and customer information such as Go-Pay balance, and customer transaction record along with the description of the transaction history. The Go-Send driver or courier must be pro-active in responding to the services of the customer either at the time of the order taking or during the delivery of goods or documentations in order to increase the customers’ confidence to the company.This matter has actually been arranged through procedure and the regulation that is given by PT. Gojek Indonesia as shown in the table below: Table 2 Procedures and general requirement of Go-Jek drivers Bid Order Procedure Procedure After Bid order General Term 1. Ensure that the 1. Telephone the customer 1. Take good care mobile battery is after getting the order of Go-Jek fully charged and 2. Speak in a good and attributes. They ensure to carry polite language should not be power bank 3. Ensure the customer’s lent to other 2. Fill the mobile pick-up address is people. internet quota correct 2. Take good care 3. Dress neatly and 4. Promise to pick up in an of drivers’ wear shoes and use estimated time of 15 account. It (helmet attributes minutes should not be and jackets) Go-Jek lent to others or 4. Make Sure the to be spread to transportation unit in others. Prime condition 3. All kind of services given by Go-Jek are free
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of charge. 4. Contactcall center in number (021) 5023 3200 5. Safety First Source : Go-Jek Based on the above thing, the implementation of risk management becomes very important to re-manage the risks that happen during the delivery process starting from the order stage until the documents arrive to their destinations, particularly managing the risk management to protect the consumers. With the implementation of risk management, consumers will feel that they are more protected and risk management is expected to minimize the possibility of cases or problems that are not desirable to happen. CONCLUSION Based on the discussion that has been done, conclusion can be drawn as follows: 1. The shifting of lifestyles of society that is instant and quick can lead to accurate data and accurate information and it plays an important role in increasing the competitive power of the company that provides the service. 2. Due to the rapid data exchange and information, it is required that the application management is well managed. 3. The security factor is not the only one from the human resources factor which is the drivers but also on the data and information security presented by Go-Send application. 4. Risk management is an important aspect in achieving the trust of customers or users who use Go-Send fiture in entrusting the delivery of goods or documents by using this application. 5. The advantages of using risk management analysis are to increase revenue, shareholder value, and risk management analysis can create a robust risk management infrastucture in order to improve Go-Jek competitiveness. 6. REFERENCES Abbas Salim. 2006. Manajemen Transportasi, Jakarta: PT.Raja Grafindo Persada. Alur proses order pada Aplikasi Go-Jek dapat diakses di https://driver.gojek.com/hc/id/articles/115007224867--Kurir-Khusus-GO-SEND-Sameday-MekanismeMenjalankan-Order diakses pada 06 Juni 2017, 19.43. Bloemer, Josee and Gaby Odekerken-Schroder. 2002. Store Satisfaction and Store Loyalty Explained by Customer and Store Related Factors. Journalof Consumer Satisfaction, Dissatisfaction and Complaining Behavior, 15: 68-83. Cooper, D R. and Emory, C W., 1995, Business Research Methods, 5th edition, Richard D. Irwin Inc. Creswell John W., 2010, Research Design : Qualitative, Quantitative, and Mixed Methods Approaches, 3th, terjemahan Achmad Fawaid, Yogyakarta Garbino, Ellen and Mark S Johnson. 1999. The Different Roles of Satisfaction, Trust, and Commitment in Customer Relationships. Journalof Marketing 63: 70-87 Hidayat, Nur, 2015, Corporate Tax RISK Management : Manajemen risiko perpajakan perusahaan, Jakarta :Kompas Gramedia. Lokobal, Arif, Marthin D.J. Sumajouw & Bonnie F. Sompie. 2014. Manajemen Resiko Pada Perusahaan Jasa Pelaksana Konstruksi di Propinsi Papua (Studi kasus di kabupaten Sarmi), Jurnal Ilmiah Media Engineering Vol 4 no 2. McLeod, R dan Schell, G.P, 2009, Sistem Informasi Manajemen, Jakarta: Salemba Empat.
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Moenir. 2014. Manajemen Pelayanan Umum di Indonesia, Jakarta : PT. Bumi Aksara Morgan, Robert M., dan Shelby D. Hunt, 1994, "The Commitment-Trust Theory of Relationship Marketing", Journal of Marketing, Vol. 58, July, pp. 20- 38. Mowen. J.C. dan Minor, M., 2002, Perilaku Konsumen, Jilid 1, Jakarta: PT Penerbit Erlangga Survei internet APJII 2016 (dapat diakses di https://apjii.or.id, diakses pada 3 April 2017, 07.00. Turban, E., Linda Volonino 2005, Information Technology For Management, 7th Edition, John Wiley & Sons, Asia. Widagdo, Setiawan 2012, Kamus Hukum, Penerbit Prestasi Pustaka, Jakarta Zeithaml, V.A & Bitner, M.J. 1996. Service Marketing. New York : The McGraw Hill Companies, Inc.
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THE IMPLEMENTATION OF KNOWLEDGE MANAGEMENT FOR THE PROFESSION OF MANAGEMENT CONSULTANT 1
Handy Aribowo, 2Erni Halim STIE IBMT Surabaya INDONESIA
Emails:
[email protected],
[email protected] ABSTRACT The right strategy to have strong competitive power needed by the company in order to face the tight business competition by using or hiring management consultant is one of the strategy to face the business competition. Management consultant are able to assist companies in dealing and handling with the business problems as well as to expand the business of the company. The method that is used in the research is in the form of literature study taken from books which writes about business research and librarian, as well as the emphirical studies from the journals related to business research and librarian for national and international scale. The conclusion herewith from this research among others: Knowledge Management is the compulsory capital that must be owned by a management consultant in handling clients in very competitive era, that are very harsh. Knowledge Management is indeed needed along with the information technology and communication advancement, as well as the implementation of Knowledge Management that can form skill owned by management consultant and consultant managment so that both are able to obey and operate based on etical code of the profession. Keyword : Knowledge Management , Capability, Skill, and Etics Code
INTRODUCTION The tight business competition right now demand each company to have a certain strategy that can be shown off the competitive advantage in particular way so that the company can have competitive power with other companies. Competition right now happens not only among products and services, but the competition happens also across products and services, for example, services like transportation facility services, where air travel or flights or airline service compete tightly with train services, and sea-transport service. In addition to those kind of transports, ‘ojek’ transport service that is still conventional , right now, have a heavy competition in form of on-line transport service, even or worse, on-line transport service in certain regions of Indonesia face objection and defense from the regular ‘angkot’ (city transport) and drivers of the conventional taxis.
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In order to have a competitive power that is strong in business competitions, the company are required to be able to implement the right and efficient strategies. However, it happens that the strategies can not be done well because of several or many other factors. One of those factors is the problems happen in a company ; therefore, strategies that are planned to be discussed arranged cannot run. In order to overcome the problems, other alternative solution is required in order to plan and arrange competitive strategies that can bring up specific competitive advantage. However, sometimes, with the limited time and limited human resources owned by the company, the company are not able to resolve the problems and the problems are likely to even get more protracted and they spread to other problems. One of the alternatives is in a form of assistance from other party such as service from management consultant. One of the expectation by a client from the management consultant is the ability to give input or advice to the problems faced by the client, which certainly the problems are about management area, where the role of a management consultant plays importantly in solving the problem or he is the problem solver to help the client who is facing the problem. In addition to solving the problem, the service of a management consultant can also be used by the companies for the purpose of doing a business development strategies, where in this situation, analysis are required as well as to see the business trend seen from management consultant point of view. The profession of management consultant demand to convince the clients about their contributions. They certainly have to have concept, methodology , and tools for the purpose of giving solution to the problem. Also, a consultant need to have solution to the problem that the client is facing where the solution is in the form of advice that is objective and perspective to outsider. Although the concepts, the methods, and the tools as well as the solution from the management consultant towards the clients are still functioned as the second opinion, the concept, methods, and the tools and the solution to the problem have very strong base; therefore, they can be used by the client as the solution to the problems. The process of concepts, methods, and tools as well as the solutions that are owned b the management consultant requires technical things and strategic things to get it. As for the technics and strategy to achieve them, it can be used or gained through the implementation of Knowledge Management. The implementation of knowledge management is the need that is very basic from the management consultant profession. According to Praharsi (2016) it is said that Knowledge Management is the steps that are systematic and effective in managing the knowledge owned by the companies to create competitive advantage. Management consultant who has the responsibilities to solve the client’s problem as well as to develop the client’s business, is demanded to be able to manage and operate Knowledge Management, because one of the source of solving the problem and developing the business from client, the main source is the knowledge management which is possessed and mastered by the management consultant. Based on the description of the background, the formulation of the statement of the problems studied in this research, are as following: (1) How is the role of knowledge management in supporting the job to the profession of the management consultants described or explained ? (2) How is the implementation of knowledge management to the management consulting profession be described ? The purpose of this research are : (1) To provide an overview on how important the role of knowledge management is in supporting the job of the management consultant profession. (2) To provide an overview on how to implement the knowledge management to the management consulting profession. LITERATURE REVIEW Management Consultant There are several definitions about management consultant, such as Institute of Management Consultant (1996) which defines that management consultant as one of the business entreprise
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consulting services that are managed and performed by independent and eligible or qualified parties, individually or by group. Kubr (2000) defines that Management Consultant is a profession where someone becomes a partner who helps his/her clients to solve management and business problems, to help organization to achieve the objectives, to help identify new opportunities, increase study capabilities, and make changes. According to Ahuja (in Aribowo 2014) defines Consultant Management as the ones who offers consultation service to all fields related to the field of management. Apart from it, the understanding of management consultant is a profession that provide independent advices, that has particular capabilities in management field in order to achieve organizational goals and objectives through solutions to business and management issues, identification and measurement of new opportunities, learning and implementation of change. Accoring to Ray (2005), a management consultant is not one of the employee or staff of a company, but he/she is working independently and can be contracted to handle certain tasks and the management consultant is paid hourly or per hour, depending on the agreement. The business that can be assisted or helped by management consultants in their mission to develop the business of companies are among others business in : Marketing, Finance, and Accountancy, Tax & Taxation, Laws, Information Technology , Human Resources Management, and Production and Operation. Knowledge Management Every person in this world has to own knowledge, knowledge is like a life to humans in his life. The meaning of knowledge according to Laudon (2008) is the physiological cognitive events that occur in the human mind. As for knowledge according to Soleh (2015) is the capability to take effective action (Soleh 2015). Addleson (2000) sees the knowledge from two point of views. First, the knowledge as First, knowledge as a physical being and is described as an asset. Second, the knowledge as a process, and is created when somebody interacts and shares his/her knowledge with someone else or with people from other group. Types of Knowledge according to Suparna (2005) is devided into : a. b. c. d.
Fact, consist of observed objects and verbal information Concept, consist of concrete concept and formed concept Procedure, consist of linear sequence and dual discrimination Principles, consist of natural rules and rules of activity
Tiwana (2002) defines knowledge management as the organizational knowledge management in order to create value and to produce competitive advantage or prime service. As for American Productivity and Quality Centre (APQC) in Sangkala (2007) defines knowledge management as the strategy and process of indentifying, capture and dig out knowledge for the purpose of imcreasing and improving business competitive power. Knowledge management is the management using knowledge as the focus (Yadi, 2016). Knowledge management can be understood as an effective action in managing and make the best use out of the information to become knowledge to create company competitive advantage (Praharsi, 2016) RESEARCH METHODS The method that is being used in this research is in the form of literature review. According to Jesson et al (2011), the literature review is a written product which opens up a topic or result of a published research . without any description of a scientific methodology. Cooper in Creswell (2010) explains that literature review has several objectives that is to inform to the readers the
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results of other researches that is related closely with the current or existing research conducted at this moment, to connect research with the available literatures and filling in the gaps in previous researches. So the research, through the literature study, aims to provide a model or a description on how the knowledge management for the profession of management consultant is implemented. Data that is managed to be collected in this research come from National or International scale of Journals that discuss about business research and librarian, who is chosen subjectively by the researcher. In addition to the research, this research is also supported by data and information that are available in the public such as supporting books, newspaper, magazines, research publication report by emphirical studies from the competent institution. In this research, the researcher reassemble important ideas from the National and International journals, supporting books, newspapers, magazines, research publication report that is choosen by means of logical thinking, systematical and critical argumentative thinkings. Result of the Research and Explanation The tight competition in various different business industries makes the company have to have its own strategy in order to win the competition. One of the ways that can be used by the companies in their strategies to win the competition is to use or hire the service of a management consultant. Management consultant can be used as the second opinion in order to overcome and solve business problems as well as to develop business. For that reason, somebody has to participate and choose seriously the profession of a management consultant. He/she has got to own competencies and qualifications that are quite sufficient or expert and he/she has got to own a very good and mature experience in handling the business problems of his/her cliets, as well as expanding the clients’ business. Also one of the tools that can be used by management consultant is the capacity of the knowledge that is owned by the management consultant in order to handle the client business problems. According to Berglund and Werr in Rupidara and Prajudo (2003), in doing his/her profession , a management consultant is indeed in need to be able to convince his/her client about his/her contributions, so that clients do not spend money uselessly when clients are using the service or management consultants. The focus of Knowledge Management according to Tuomi (1999) is on the management of knowledge resources such as skills, competencies, expertise, product knowledge ( product design and document) and organization assets (identities, language, and motive system). Then, as the focuses or important points on the implementation of Knowledge Management according to Dewiyana (2004) can be explained as follows: a.
The availability of serious effort to increase cognitive systems (organization, human resource, computer, or the combination of human and computer system). b. The availability of knowledge assets that are managed, that come from inside the organization or outside the organization, individual person, and group. c. The availability of supply process, the process itself, storage, and the use of the knowledge in order to achieve certain objectives. d. The availability of knowledge distribution and spread and the experience sharing, either from the direct access to database and through the sharing and collaboration towards internal and external environment of the organization. e. The availability of activities and innovation to create new knowledge. In the era that is full of technology advancement and information improvement, knowledge management is really needed by the business society including all kind of management consultant profession, especially in giving advices that can improve and increase the clients’ competitiveness that is being handled by the management consultant. According to Chao in Muluk (2004), if an organization want to retain or keep their competitive advantage that they
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already own, the company has to be able to manage information. Choo in Muluk (2004) even also adds that information technology advancement and communication bring serious consequences and it is important to push to the need of knowledge management. According to Rupidara and Prajudo (2003), in general, the knowledge can be gained from various learning resources and should be developed continuously for the sake of doing the consultation process. Besides that thing, according to Berglund and Werr (2000) that in the process of convincing the client about the importance of the offered knowledge, management consultant generally combines between the new aspects (novelty) and something that is common (familiarity). Knowledge management also has to pay attention to the point of view from up-to-date side, so that it is a must to always renew the knowledge to follow the trend of the development of the era. For that reason, the management consultant are competing harder to improve their level of knowledge that is owned by them as one of the capital and “amunition” in solving the business problems of the clients. The increase of the level of knowledge can also be used to expand or develop the clients’ business. They should prevent their solution in such a way so that the solution given by the management consultant in handling the clients’ business problem or in developing the clients’ business is not “old-fashioned or out-of –date” and therefore not suitable with the development of the era , or they are not suitable to the current situation or the situation and condition that happen in the companies owned by the clients. According to Aribowo (2014), the facility to improve and increase the knowledge, and to update the knowledge, tools and methodology in giving advice from the management consultant to the client in management field are among others by attending seminars, attending training, and also following the development on management world through books, magazines, newspaper, scientific journals, internet, and television. What is required by in the knowledge by a management consultant according to Siagian (1997) are among others: a. To have expertise in one field of management activities. b. To have broad understanding on the technical fundamental or basic management. c. To be able to appreciate management theory and organization. d. To understand human factors, and process which can influence working methods, organization motivation, commitment, team work, and interaction. e. To be able to appreciate the roles and functions of typical and specific business and environmental factors which can influence how an organization operates. f. To master knowledge in business administration field including basic accounting, laws, and commercial activities. Related to the knowledge owned by a management consultant, particularly by the local management consultant, particularly, with the existing competition and with the differences in their characteristics between the local management consultant versus foreign managment consultant. Tossin (in SWA magazine 2006) explains that in handling the client’s problem, local consultant are more superior in local knowledge such as in knowing the market condition, consumers, politics, economics, and also the fee of local consultant is relatively lower when compared to foreign consultant. Whereas, foreign consultant have excessive or more access to vast information in the field of information and broad networks. One of the implementation of knowledge management is the formation of skill that is owned by management consultant which is expected to be made as an asset and “ammunition” in solving the problems as well as in developing the business of the client. The skills from the management consultant is expected to give value and changes that is moving forward to the expansion of the clients business towards better things. The implementation of the value and better changes are among others can be done through certain ways such as through system development, solution, support, services and others. Beside that, the implementation of the knowledge management from management consultants happens when the consultant gives
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advice on how to solve the problems and how to develop the clients’ business where knowledge, tools, and methodology that is given have to be adjusted with the situation and condition of the clients. It must be avoided to say that knowledge, tools, and methodoloty given is the ones that are just the same to the methodology given to all other clients that have been previously handled by the management consultants. Because every problem handled has its own characteristics, and its own uniqueness, and they also happened to different situations and conditions. The profession of a management consultant can be compared and equalized to the term of a “docter” who gives medicine to suit the patients, its dosage of the medicine given to the patient having the sickness or illness will be different according to the analysis. Therefore, expertise in analyzing in the correct way in prescribing the dosage of medicine has to be correct and accurate and exact so that the illness of the patient can be cured. As for the skills that are needed by the management consultant according to Siagian (1997) are among others: 1) the ability to analyze, 2) the ability to diagnose, 3) the skill in decision making, 4) the skill in interaction, 5) the skill in doing persuasive action, 6) the skill to communicate, 7) the skill in marketing, 8) the skill in selling. According to Rassiel (2004) that in the global management consulting company like Mc. Kinsey, in solving the client’s problem, there are 3 main characters to the problem solving which consist of 1) based on the facts, 2) Well and tightly structured, and 3) Supported by hypothesis. One of the main things that must be owned by a consultant is the ability to maintain integrity in keeping the trust from the client. In doing and working on his /her profession as the management consultant, integrity is closely related to the etical code, so that one of the knowledge that must be owned by a management consultant in doing his/her profession is etics code of management consultant. The situation that creates etics in the activities done by management consultant profession is about the confidentiality or secret, disputes on the goals and objectives and purposes of each person or department, information from insider / or closely related family members, qualifications , salary, compensation or bonus or fees, personal relationship, objectivity, and loyalty (Siagian, 1996). To keep the clients’ secret confidentially is the implementation or the practice of etical codes of the management consultant. The secret or the confidential things of the clients must always be kept confidential or keep them as secret. Even when the client is no longer having a cooperation again with the management consultant or the clients has nothing to do with the management consultant anymore. Even it exists several individual consultant or the institution or foundation on management consultant that possess a high idealism as not to accept clients from the same or similar industries or with the clients that are in the middle of being handled by another management consultant. The elements of etisl code of management consultant are among others Klien, Engagement, Fee, and Profession (International Finance Corporation, 2016). Whereas, there are other reasons which is behind the importance of etics code for the profession of management consultant according to International Finance Corporation (2016), among others are: 1. Education effect, is the etics code which provides guide lines to the members of institution about actions, and etical behaviors which are accepted by society. 2. Doubt clearance, which is etics code to reduce the area where someone has to fight his/her doubt. 3. Visible and impersonal standard which is etics code to help consultants in making the decision. 4. To gain the trust from business and society. There has been an organization of consultants located in Indonesia which is called Ikatan National Konsultan Indonesia or in brief name it is called Inkindo. Inkindo is an organization formed as the result of the combinations of Indonesian consultants ties IKINDO (Ikatan Konsultan Indonesia), and the combinations of Technical consultant association of development
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of Indonesia or PKTPI (Persatuan Konsultan Teknik Pembangunan Indonesia) which has been founded since year 1979. The etical code of Inkindo among others are as following: 1. Upholds the honor, the glory and the reputation of the consulting profession in employee relationships with the people who assign the work or the task and with the fellow consultants and the community. 2. Behaves and works honestly and impartially, and work with dedication of serving the employeer and the communities. 3. Exchanges knowledge of his field of expertise in a fair way with the consultants and professional associates and to improve the community’s knowledge of the existence of the consulting profession so that people appreciate more and better of the work done by the consultants. 4. Respects the principle of remuneration process for the consultant fee that is sufficient and adequate so that it is believed to be really professionally and morally accountable to ensure that consultants can carry out the duties entrusted by complying to all requirements related to the expertise, and competence, and high integrity of the consultants. 5. Appreciates and respects the professional reputation of the co-consultants or colleagues, as well as any employment agreement related to his profession. 6. Gets the job primarily based on professional skill standards without going through unfair competitions. 7. Works together as a consultant only with co-consultants or other experts who have high integrity. 8. Implements the principle of sustainable development in all aspects of the consultants’ services as an integral part of his /her responsibility to others, to the wider life environments, and to the future generations. Etics code that a management consultant should have according to International Finance Corporation (2006), are among others : First, he/she has to have a high moral integrity. Second, he/she has to be open minded, transparant, and honest. Third, he/she can appreciate time. Fouth, he/she can keep clients’ secret. Fifth, he/she can uphold clients professional etics. Sixth, he/she can support the best practice. Seventh, he/she can maintain client’s reputation, and eight, he/she obeys and follows the rules and laws. By obeying the etic codes of professions, when the management consultant is handling and solving the client’s business problem , there will be guarantee that the management consultant will not deviate from regulation and laws; then, the clients will feel secure and comfortable and calm when client use the consultant’s service. CONCLUSION The conclusion from the research are as following: 1. Strict business competition and the limited internal knowledge resources owned by the company are the major problem; therefore, the service of the consultant management is highly needed. The service is needed to be used as second opinion in helping or assisting the clients to face the business competition. 2. Knowledge is needed on the profession of management consultant in order to be able to manage the knowledge resources during the consultation process, and knowledge can be obtained from various learning sources and knowledge needs to be developed continuously through following the seminar, training, and following the development of management world through books, magazines, newspapers, scientific journals, internet, and television. 3. Knowledge capacity is one of the main indicator to be able to compete among fellow management consulting profession in providing or giving the management consulting services to clients. 4. Implementation of knowledge management for the profession of management consultant is the improvement of skills owned by management consultant which is expected to give value
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and to change the client’ business development, and to obey the ethical code of professional management consultant in order to make client feel comfortable and calm when hiring and using the service of the management consultant. REFERENCES Bawden, David. (1996). “Information Policy or knowledge locy?” dalam Understanding Information Policy. London: Bowker Saur. Dewiyana, Himma. (2004). Perpustakaan dalam konteks knowledge management studi kasus Perpustakaan Universitas Indonesia. Depok: Universitas Indonesia. Cresswell, J. (1998) “Research Design : Qualitative & Quantitative Approaches”. Thousand Oaks, CA : Sage Publications. Griffin,Ricky W (2004), “Manajemen”, Erlangga, Jakarta (Terjemahan) Kubr,M (2000) “Management Consulting : A Guide to the Profession” Geneva International Labour Office Pendit, Putu Laxman (2001). Manajemen Pengetahuan dan Kompetensi Profesional Informasi. Disampaikan dalam Seminar IMPI, Bank Indonesia Jakarta, 10 Nopember 2001. Ray, Douglas (2005), “Memulai dan Menjalankan Bisnis Konsultan”, Cetakan Perdana, Abdi Tandur, Jakarta. International Finance Corporation. (2006), “Standar Etika Konsultan” makalah dalam Workshop Konsultan 2006 11-13 Juli 2006. Surabaya : International Final Corporation dan Peac Bromo. International Finance Corporation. (2006), “What Is Consultant” makalah dalam Pelatihan dan Sertifikasi Modul I : Dasar-dasar konsultan UKM dan Industri Perbankan 19-21 Desember 2006. Surabaya : International Final Corporation dan Peac Bromo. Pelatihan dan Sertifikasi Konsultan Keuangan UKM (BDS Finance) Modul 1 : Dasar-dasar Konsultan UKM dan Industri Perbankan, 19-21 Desember 2006, Peac Bromo. Angkatan XIV. Tiwana, Amrit (2002). The Knowledge Management Toolkit: Orchestrating it, Strategy, and Knowledge Platforms. 2nd ed. New Jersey: Prentice Hall.
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THE EFFECT FACTORS OF ATTITUDE TOWARD BEHAVIOR, SUBJECTIVE NORM AND PERCEIVED BEHAVIOR CONTROL ON INTENTION OF STOCK INVESTMENT BY INDIVIDUAL INVESTOR IN JAKARTA Arya H. Satmata, 2Tommy C. Efrata♠
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Ciputra University Surabaya INDONESIA Email:
[email protected]
ABSTRACT This study aims to determine the influence of Attitude Toward Behavior, Subjective Norm, and Perceived Behavior Control to the intention of stock investment. Attitude Toward Behavior has four indicators: expectations, intention, good / bad feelings, and feelings of likes / dislikes. Subjective Norm also has four indicators: the influence of important person, the influence of near person, the influence of the community, and the freedom in making the decision. Likewise, Perceived Behavior Control also has four indicators: confidence in ability to invest, perception of ease / difficulty in investing, perception about the condition of self to invest, and perception of the ability to make profits in the investment. Finally, intention has three indicators as the willness to do best effort, the plan to act, and the intention to act. In addition of these three main variables, as further analysis will be examined also the influence of demographic factors and stock training as control variables. Data analysis was done by using qualitative method that is Partial Least Square (PLS). The population in this study is the individual investor of mirae asset securities located in Jakarta city on April 2017. While the sample used amounted to 200 respondents with sampling technique as simple random sampling method. Based on the results of the analysis, it is known that the most positive factor is the Attitude Toward Behavior factor, followed by the Subjective Norm factor. As for the Perceived Behavior Control factor has no effect on the intention of individual investor in stock investment. The control variables also have an effect weakly on the intention in stock investment. These variables are gender, age, income, and number of stock training ever joined. Men have more intention in stock investment. The older of customer’s ages, the less intention to stock investment. The greater of customer's income, the less intention to stock investment. And the more training of customer joins, the more intention to stock investment. Keywords: Attitudes toward Behavior, Subjective Norms, Perceived Behavior Control, Intention, Stock Investments, Stocks Training, Demographic Factors.
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INTRODUCTION After the monetary crisis of 1998, the stock market in Indonesia has begun to appear the result of its investment. It can be seen from the data of JCI (Composite Stock Index in Indonesia) which reached revenue of 635% in 18 years in January 1999 to December 2016 period. That means the average return on JCI investment per year is 10,81% per year . For long-term investment, this figure is quite good when compared with other investments such as doposito, property or gold. However, it was not followed by the intention of Indonesian people to invest in the stock market. This can be seen from the data owned by OJK (Financial Services Authority) and KSEI (PT Kustodian Sentral Efek Indonesia) in 2016, which shows that from 60 million banking customers in Indonesia, only about 490 thousand individual stock market customers or about 0, 81% of the total banking customers in Indonesia. And of the 135 million number of banking accounts in Indonesia, only about 618 thousand stock exchange accounts or about 0.45% of the total banking accounts in Indonesia. From these data, this research tries to study the psychology factor that is predicted as the strongest factor influencing Indonesian people to invest in stock market. These psychological factors will be analyzed using the theory planned behavior (TPB) introduced by Azjen (1987). In the theory of planned behavior, it is stated that before a person (stock investor) engages in behavior (investing in stock market), there is a preceding variable of intention. And the intention influenced by Attitude toward Behavior, Subjective Norm, and Perceived Behavior Control. In addition, the further analysis will be done by taking the other factors (as control variables) that can better explain the real reality. These factors are demographic factors and stock training factors. OBJECTIVES: 1. Analyze the effect of Attitude toward Behavior on the intention of stock investment. 2. Analyze the effect of Subjective Norm on the intention of stock investment. 3. Analyze the effect of Perceived Behavior Control on the intention of stock investment.
LITERATURE REVIEW In studying of intention in investing action, some researchers have conducted prior research using psychological factors, demographic factors as well as training factors or investment knowledge of a person as factors influencing their intention in investing. Theory of Planned Behavior by Ajzen (1987) explains that a person's behavior is determined by an intention. Intention is a function of behavior. This intention is determined by three things: Attitude toward Behavior, Subjective Norm and Perceived Behavior Control. Theory of Planned Behavior states that three things of determine the intention is the main point that is able to predict a behavior. Therefore the intention can indicate the behavior that will be done by someone. This may explain that if a person who has an intention in investing then most likely he will take actions to achieve his desire to invest, such as attending training and seminars about investing, receive a good investment offer, and then make an investment. Philmore & Broome (2010) in his research concluded that Attitude toward Behavior is the most significant factor of student intention to invest. This study concludes that the paradigm t in the minds of students have a major cause in determining their decision to invest. This study concludes that factor of attitude towards investment decisions have a significant effect. However, the study found that Attitude toward Behavior variables can not operate on their own but also depend on social influences as well as individual experience and control behavior. David Wanyoike (2016) in his study also concluded that Perceived Behavior Control and Subjective Norm were found to have a greater influence on employee intention in purchasing
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health insurance than Attitude toward Behavior. This study concludes that an individual who is influenced by Subjective Norm from their internal environment is a significant factor in decision making. Phan & Zhou (2014) in his research supports the hypothesis that intention in investing between individuals is driven by Attitudes toward investment, Subjective Norm and Perceived Behavior Control. According to him intention in investment has a strong impact because of the influence of factors Perceived Behavior Control then the Subjective Norm factor. Barber & Odean (2001) conducted a study to determine the behavior of investors based on gender factor differences (gender). Quantitatively, this research concludes that male behavior tend to risk seeker whereas female investor behavior tend to risk aveter. Kiran & Rao (2004) conducted a quantitative study to identify investor segmentation based on demographic conditions. One such condition is the age factor. The results of this study is the age factor is strongly influential on the risks taken in investing. Where at the age of 41-50 years, people will avoid the risk in investing. Shum & Faig (2005) examines the large influence of one's earnings of stock ownership in the stock market. This quantitative study concludes that as income increase, the sensitivity of earnings to risk in the stock market will decrease and intention in investing in the stock market will increase. Therefore, factor of income will be used as an indicator that affects the variable of intention in stock investing. Research by Komang (2015) aims to determine the effect of investment knowledge on student intention to invest their money in the stock market. Research conducted using this quantitative method successfully proves that knowledge of investment is positive significant on student intention of investment. HYPOTHESIS: H1: Attitude towards Behavior has positive significant effect on intention of stock investment. H2: Subjective Norm has positive significant effect on intention of stock investment. H3: Perceived Behavior Control has positive significant effect on intention of stock investment.
RESEARCH METHODS A. DESIGN SAMPLING Data collection was collect from 200 individual customers of Mirae Asset Company in Jakarta on April 2017. The sampling method used in this research is simple random sampling technique. By determining the magnitude of error (significance) of 5%, then the value of Power (P) = 0.95 and Effect size (F2) = 0.1. Then by using L-table with 5% significance level and value u = 3, then the value of L is 19.76. So with the formula we get the sample size: N = (L / F2) + u + 1 = (19.76 / 0.1) + 3 + 1 = 200 (rounded). The research instruments used in this study for data collection is an online questionnaire or commonly called the online questionnaire. And in this case researchers used google docs as an online questionnaire. B. INDICATORS Attitude Toward Behavior has four indicators: (1) expectations, (2) interest, (3) good / bad feelings, (4) and likes / dislikes. Subjective Norm also has four indicators: (1) the influence of important person, (2) the influence of near person, (3) the influence of the community, and (4) the freedom in making the decision. Likewise, Perceived Behavior Control also has four indicators: (1) confidence in ability to invest, (2) perception of ease / difficulty in investing, (3) perception about the condition of self to invest, and (4) perception of the ability to make profits
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in the investment. Finally, intention has three indicators as (1) the willness to do best effort, (2) the plan to act, and (3) the interest to act. C. ANALYSIS This study used correlation analysis and Partial Least Square (PLS) analysis. Correlation test is intended to determine the relationship between two variables studied. While the PLS analysis is intended to confirm the theory and can also be used to explain the presence or absence of the relationship between latent variables with its indicators. Data analysis was performed using VPLS 1.4 software. The results of the analysis presented are the values of Convergent Validity, Discriminant Validity, Composite Reliability, and Cronbach Alpha on outer model measurement; Values of R2, f2, and t-test on inner model measurements; As well as create an equation of the path diagram results that have been calculated by the PLS program. With these analyzes then will be known the significance of the parameters that exist and will be used to test the hypotheses proposed in this study RESULT AND DISCUSSION Figure-1 shows that the variable Attitude toward Behavior has the greatest effect that is 1.738 to the variable Intention of stocks investment. While the Subjective Norm variable has an effect of 0.734 and Perceived Behavior Control variable has a negative effect of -1.555. In addition the model diagram has a value R2 of 0.671. This figure explains that the variability of dependent variables can be explained by the variability of these three independent variables as 67.1%.
Figure 1: Visualization Results of Path Diagram
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A. INNER MODEL By evaluating the model and measurement on the inner model, the following equation will be generated as the result: η1 = 1,738 ξ1 + 0,734 ξ2 – 1,555 ξ3 Information: η1 = Variable Intention of Stock Investment ξ1 = Variable Attitude toward Behavior ξ2 = Variable Subjective Norm ξ3 = Variable Perceived Behaviour Control Negative value on the Perceived Behavior Control variable means that the variable has a negative effect on the intention of stock investing. But the significance of these effects should be tested first using the t-table value. If the value of the t-stastistic variable is greater than the ttable value, then the negative result has a meaning. On the other hand, if the t-statistic is smaller than the value of t-table then negative coefficient value can be ignored, so it has no meaning or no significant effect. B. OUTER MODEL After evaluating the model and measurement on outer model, there will be some equation as follows: X1 = 0,781 ξ1; X2 = 0,825 ξ1; X3 = 0,707 ξ1, X4 = 0,792 ξ1, X5 = 0,533 ξ2, X6 = 0,621 ξ2, X7 = 0,521 ξ2, X8 = 0,605 ξ2, X9 = 0,520 ξ3, X10 = 0,811 ξ3, X11 = 0,619 ξ3, X12 = 0,655 ξ3, Y1 = 0,793 η1, Y2 = 0,820 η1, Y3 = 0,845 η1. Information: X = Indicators affect to independent variables Y = Indicators affect to dependent variables η1 = Variable Intention of Stock Investment ξ1 = Variable Attitude toward Behavior ξ2 = Variable Subjective Norm ξ3 = Variable Perceived Behaviour Control These equation shows that all loading factor from each indicator to its variable is bigger than 0,5. This result indicates that all indicators for each variable, both independent variables which are Attitude toward Behavior, Subjective Norm, and Perceived Behavior Control as well as dependent variable on Intention of Stock Investment is valid. C. TEST RESULT OF HYPOTHESIS The results of path coefficients and t-statistic values obtained through the bootstrapping process with the number of samples for resampling of 500 and repetition of 300 times by PLS program are shown in Table-1 as follows: Table-1 : Hypothesis Test Results Using t-Statistic Test
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Using a significance level of 5% or a confidence level of 95%, then precision or inaccuracy limit of (α) = 5% = 0.05 result t-table of 1.960; So the results of hypotheses tested in this study are: 1. Attitude Toward Behavior has significant positive effect on Intention of Stock Investment. 2. Subjective Norm has significant positive effect on Intention of Stock Investment. 3. Perceived Behavior Control has no significant effect on Intention of Stock Investment. Perceived Bahavior Control has negative path coefficient to intention investment variable of stock. It means that in fact the PCB variable has a negative effect on the variable of intention in stock investing. However, due to its t-statistic value is smaller than t-table, the negative coefficient value can be ignored, so it has no meaning or no significant effect. D. CONTROL VARIABLES In table-2 it can be seen that majority control variable has f2 value which is too small and can be ignored. But there are four control variables that have the value of f2 above the threshold. These four variables are; Gender with a value of f2 is 0,024; Training stock with value f2 is 0,038; Income with a value of f2 is 0.012; and age with a value of f2 is 0.012. Although they have a f2 value above the threshold but its value is weak. So the effect on the intention of stock investing is also weak. Table-2 : Correlation of Control Variables With Coefficient of Determination (R2) & Effect Size (f²)
The gender variable has a negative correlation of -0.141 which means that men have more intention to invest in stocks than women. While the Stocks Training variables have a positive correlation of 0.176 which means that the more often a person conducting stock training is also greater intention of stocks investment. For income variables that have negative correlation of 0.151, means that greater the income a person actually has smaller intention of stocks investment. The last is the age variable that has a negative correlation of -0.123 which means that the older the age of someone, the less intention of stocks investment. However, the effects of the four control variables is only weak due to the small f2 value.
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LIMITATIONS 1. The sample of respondents in this study is individual customers of Mirae Sekuritas company in Jakarta, where all respondents already know about stock investments and have ever conducted transactions in the stock market. 2. Sample of respondents taken in the period April - May 2017, when stock market conditions are bullish (up). So the conclusions of this study may not be applicable to other periods where the stock market is in bearish condition (down) or sideways (flat). 3. Test the validity and reliability is done with the data used, that is as much as 200 respondents. Academically, a validity and realibility test should be performed first before analyzing all data. 4. This research model is only measured using three independent variables with coefficient of determination R2 equal to 0,671 of variable Intention of stocks Investment. While control variables that can actually explain the determination of 0.329 were not included in the main model in this study due to limited information available.
SCOPE FOR FUTURE RESULT 1. Perform research by looking for any mindsets that negatively affect to intention of stocks investment that prevents people from investing in stocks. 2. Next research is expected to be performed on a sample of respondents who are not stock customers where they have never conducted any transactions on the stock market or even not knowing about stock investments.
CONCLUSION This study concluded that Attitude toward Behavior and followed by Subjective Norm have significant positive effect to intention of stocks investment. So the results of this study strengthen the existing theories from previous studies. However, it was found that Perceived Behavior Control had no effect on the intention of stock investing. These findings contradict but refine the previous theories that Perceived Behavior Control will have a significant positive effect on intention of stocks investment if a person has never invested in stocks. But if a person has been or is still investing in stocks that means the person already knows how to control the actual behavior (not just perception) of the stock investing action, then Perceived Behavior Control has no effect on intention of stocks investment The results of this study also concluded that gender, age and stock training have an effect on the intention of stock investing. So the results of this study strengthen the existing theories from previous studies. That men have a greater intention than women to invest in stocks, the older a person's age, the less their intention in stock investing, and the more stocks training that a person participates makes greater intention in stock investing. However, it was found that the amount of salary income had a negative effect on the intention of stock investing. These findings contradict but refine previous theories that income will have a positive effect on intention of stocks investment if their knowledge of stock investments is good enough. But this result does not apply to people in developing countries like Indonesia where the knowledge of the most people about stock investments still very less. Precisely in Indonesia salary income will have a negative effect on the intention of stocks investment.
REFERENCE Brad M. Barber & Terrance Odean, “Boys will be Boys: Gender, Overconfidence, and Common Stock Investment”, The Quarterly Journal of Economics, February 2011
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David Wanyoike, “Psychological Factors and Investment Decisions Among United States International University Students Nairobi Country, Kenya”, United States International University Africa, 2016 D. Kiran & Prof. U.S. Rao, “Identifying Investor Group Segments Based on Demographic and Psychographic Characteristics”, Sri Sathya Sai Institute of Higher Learning, 2014 Icek Ajzen, “The theory of planned behavior”, Organizational Behavior and Human Decision Processes, December 1987 Luh Komang Merawati, “Kemampuan Pelatihan Pasar saham Memoderasi Pengaruh Pengetahuan Investasi dan Penghasilan Pada Minat Berinvestasi Mahasiswa”, Jurnal Ilmiah Akuntansi dan Bisnis, Juli 2015 Pauline Shum and Miquel Faig, “What Explains Household Stock Holdings?”, Journal of Banking and Finance 30 (9), September 2006 Philmore Alleyne & Tracey Broome, “Using the Theory of Planned Behavior and Risk Propensity to Measure Investment Intentions among Future Investors”, Journal of Eastern Caribbean Studies, March 2011 Sugiyono, “Metode Penelitian Kunatitatif Kualitatif dan R&D”, Bandung Alfabeta, 2008 Tahira Hira & Cäzilia Loibl, “Gender Differences in Investment Behavior”, NASD Investor Education Foundation, August 2006 Zinkhan, George M., and Kiran W. Karande, “Cultural and gender differences in risk-taking behavior among American and Spanish decision makers”, Journal of Social Psychology, 1991
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FACTOR ANALYSIS OF STUDENT’S STARTUP BUSINESS EXECUTION IN CIPUTRA UNIVERSITY Kartikasari Gunawan, 2Thomas Stefanus Kaihatu♠
1
Ciputra University Surabaya INDONESIA Email:
[email protected],
[email protected]
ABSTRACT This research has purpose to know what factors form the start up business of Ciputra University’ students. Those factors are: planning factor, competencies factor, funding source factor, business environment factor, education factor, family factor, and technology factor. This research is using quantitative method with the respondents are students in Ciputra University. There are some criterias for the chosen of sample which are the respondent must be Ciputra University’ students that already have executed business and they must already taken the entrepreneurship education for more than five semesters in Ciputra University. The result of this research by spreading the questionnaire, students of Ciputra University which are the respondents in this research agreed that those seven factors can form the execution of the start up business. The respondents agreed that all of planning factor, competencies factor, funding source factor, business environment factor, education factor, family factor, and technology factor form the execution of the start-up business. Keywords: factor analysis, execution, start-up business, student of Ciputra University
INTRODUCTION Entrepreneurship is an important profession for advancing Indonesian economy (Kodrat and Christina, 2015:5). More entrepreneurs will be more new businesses. Increasing in new businesses can make entrepreneurs hiring people to help to run the business. The impact of an increase in job vacancies, the unemployment rate at Indonesia can be suppressed. Decrease in the number of unemployed in Indonesia can advances the Indonesian economy (Ciputra, 2009: 7). According to statistic brain which are an online statistic database managed by Seth Harden and based at Los Angeles, there are 25% of the total start-up business failed to continue its execution in the first year, 27% of total startup business Who failed to continue its execution in the second and 21% of the year Total start-up business that failed to continue its execution in the third year. Based on that phenomenon regarding the decline in the number of start up businesses that are able to sustain, it need some factors to help the businesses to sustain to keep executing the businesses. Based on several studies and literature, there are several factors that
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form business execution. These factors include: Planning Factor, Competency Factor, Source of Funding Factor, Business Environment Factor, Educational Factor, Family Factor and Technology Factor. The limitation of this research is Ciputra University environment. The reason researchers use Ciputra University as a research area because Ciputra University is an officially registered entrepreneurship education institution. All students of Ciputra University are required to have a business project and project process activities monitored from the process of ideation to the execution of the business project.
LITERATURE REVIEW Previous Research Research from Hormozi et al. (2011) entitled "Business plans for new or small business: paving the path to success" has the purpose of demonstrating that business planning can help run a business and drive the success of a business. Research by Cai et al. (2010) with a research entitled "Research on the affecting mechanism of entrepreneurial environment on new firm performance" has the purpose to know the environmental relationship to the new business performance of SMEs scale. Competency factors are evidenced by Mitchelmore and Rowley (2013) with a study entitled "Entrepreneurial competencies of women entrepreneurship pursuing business growth". It was also one of the factors forming a business execution evidenced by Mitchelmore. Research by Atherton (2012) with the title of research "Cases of start-up financing: An analysis of new venture capitalization structures and patterns" has the purpose to know the diverse funding issues and useful to support the execution of a business. Research conducted by Setyawati (2015) with a study entitled "Exploration of the determinants of the success of start-up business in Surabaya city", has the purpose to prove that education factors affect business execution. Family factors also become one of the factors that form the business execution as has been said by Koranti (2013) through research entitled "Analysis of the influence of external and internal factors on entrepreneurship interest". Technological factors are also one of the factors that form business execution, this is evidenced by research from Watkins et al. (2014). Entrepreneurship Entrepreneurship in terminology refers to the nature, character, and attributes of a person who has a strong willingness to realize innovative ideas applied to the real world and can develop the idea with firmness. According to Ciputra (2012) an entrepreneur is someone who is able to use maximally all existing resources both human and natural resources and with creative and innovative process able to create a product or service useful for society. Business Stages Uman et al. (2011) explains that the implementation of entrepreneurship concept passes through several stages as follows: 1) Start-up, in this stage someone has a very strong desire to be able to prepare everything related to new business opportunities. 2) Execution stage, empowering the aspects contained in a business. These aspects are aspects of human resources, capital aspects, organizational aspects, and aspects of leadership. In addition to empowering these aspects, employers must begin to take risks and take decisions and evaluate them. 3) The stages of sustaining the business, the results that have been achieved are used as a reference for conducting further developmental analyzes in accordance with circumstances and conditions so that the turnover, quantity, and quality of sales can survive.
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4) Developing stage, in this stage there is an effort to expand the business or increasing quantity and quality of products and services. Start-Up Business According to Ries (2013) start-up companies or pioneering companies are newly established companies and are in a development and research phase to find the right and most appropriate market that has been planned before the business executes. From the result of theoretical study and empirical study about business execution start up hence can be formulated factors and indicators used in research as follows: 1. Planning factors with indicators of knowledge about the market, products, business procedural, and competitors 2. Competency Factor with indicators of communication, management and business, entrepreneurial, and internal relations 3. Source of Funding Factor with indicator of funding source from capital, debt, and venture capital. 4. Business Environment Factors with indicators can share information on the business world, share business networks, and business community activities. 5. Educational Factors with curriculum indicators of educational institutions, mentors from educational institutions, facilities provided by educational institutions, and atmosphere of entrepreneurship in educational institutions. 6. Family factors with family support, family-owned information support, and the experience felt by family members in the business world. 7. Technological factors with indicators of social media and website usability for the marketing process and ordering of products or services, the use of management information systems to facilitate business activities, as well as the importance of technology in facilitating business operational processes.
RESEARCH METHODS This research uses a quantitative approach. The notion of quantitative is a research based on systematic, planned, structured and using numbers as the main data (Sugiyono, 2011). The place of study is at Ciputra University as a University or an authorized educational institution that uses an entrepreneurship curriculum that is appropriate to this research topic. The population in this study has several criteria, among others: 1.Ciputra University’ student at sixth semester who has business project 2.Ciputra University students who have received regular education of entrepreneurship for more than two years 3.Ciputra University students who routinely conduct consultations with business mentors that have been provided by Ciputra University 4. Project business in the stage of execution: there are activities and routine business activities 5. A stable business project in the execution process 6. The business project recommended by the project lecturer / assistant lecturer of the project in accordance with the five criteria above. From those criterias, the total population in this study is 352 students from 147 business projects (SEP, 2016). According to Martono (2011), the total population of 352 students, for determining the number of research samples can use slovin formula with 78 respondents as a sample. For primary data collection, the researcher will use the research instrument using Likert scale to measure the agree or disagree attitude of the respondent (Herlanti, 2014). Likert scale is also
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used to measure the level of approval of a statement or option in accordance with predetermined criteria (Amir, 2015). Data Analysis Method in this study, the method used to analyze the data is by using factor analysis using SMARTPLS software (Aprilia & Ghozali, 2013). The purpose of using factor analysis methods is to summarize and reduce existing variables into smaller numbers (Abdillah & Jogiyanto, 2015). Factor analysis model according to this research is using confirmatory factor analysis by using second order confirmatory factor analysis. The second order confirmatory factor analysis method is done in two stages. The first stage by performing a latent latent construct test into its indicator. The second stage by testing the latent construct to dimensional construct (Sarjono & Julianita, 2015) Confirmatory Factor Analysis This research uses Confirmatory Factor Analysis. Confirmatory factor analysis is a factor analysis technique in which a priori based on known theories and concepts understood or predetermined, then made a number of factors to be formed, as well as what variables are included into each factor that is formed and is definitely the goal . The formation of confirmatory factors (CFA) is deliberately based on theories and concepts, in an attempt to derive a new variable or factor representing some item or sub-variable, which is an observable variable or an observable variable. Basically the purpose of confirmatory factor analysis is: first to identify the relationship between variables by conducting a correlation test. The second objective is to test the validity and reliability of the instrument. In testing of the validity and reliability of the instrument or questionnaire to obtain valid and reliable research data with confirmatory factor analysis. First Order Construct According to Abdillah and Jogiyanto (2015) on the first order construct, test the measurement model from the latent-dimensional construct to the indicator. Here are the steps: 1. Validity Test Table 1: Validity Test Requirement Validity Parameter Requirement >0,7 Convergent Validity loading factor AVE >0,5 Discriminant Validity
Cross Loading
>0,7
2. Reliability Test Table 2: Reliability Test Requirement Parameter Requirement Cronbach's Alpha Composite Reliability
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3. Significance Test of Reflective Indicators Test the significance of the reflective indicator by using outer loading test. If the t-statistic value has a greater value than the t-table (t-table = 1.96 with the alpha value = 5% or 0.05) then the measurement model is acceptable. Second Order Construct In the second order construct, the test of measurement model from the latent construct to its formative dimension construct by using outer weight test. In the second construct, it is necessary to evaluate the bound construct using the coefficient of determination (R2) and the tstatistic value for the significance test between the constructs. Table 3: Second Order Coefficient of t-statistic 2 Determination (R ) >1,65 Sig. Level 10% Sig. Level 5% > 1,96 > 2,68 Sig. Level 1%
RESULT AND DISCUSSION Evaluation of Measurement Models Figure 1 shows a confirmatory factor analysis test for a second order construct that will be done through two levels, that is, the analysis of the latent-dimensional construct to its indicators and anailysis is done from the latent construct to its dimensional construct. The measurement model in this research uses first order reflective indicator and latent formative latent construct. In analyzing second order confirmatory factor analysis, it is suggested to use repeated indicator approach (hierarchical component model). Using this approach, each indicator of the latent construct will be used as an indicator of the second order construct.
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Figure 1: Measurement Model in Partial Least Square (PLS)
First Order Testing The first order test will be performed on the first order reflective indicator by using convergence validity test (factor loading and AVE), discriminant validity, reliability (cronbach's alpha and composite reliability) and t-statistic first order test. Here is an evaluation of measurement models for reflective indicators that include validity and reliability tests: Convergent Validity Convergent validity includes factor loading and Average Variance Extracted (AVE) as a form of validity test. Below is the explanation:
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A. Loading Factor Testing of Loading Factor is done on seven variables, among others, as follows:
Table 4: Loading Factor Measurement Model
Convergent Validity
Measurement Model
Convergent Validity
Measurement Model Convergent Validity Measurement Model Convergent Validity Measurement Model Convergent Validity
Result Indicator
Loading Factor
X1.1 X1.2 X1.3 X1.4
0,867 0,868 0,879 0,876 Result
Indicator
Loading Factor
X2.1 X2.2 X2.3 X2.4
0,926 0,949 0,957 0,949 Result
Indicator
Loading Factor
X3.1 X3.2 X3.3
0,960 0,848 0,963 Result
Indicator
Loading Factor
X4.1 X4.2 X4.3
0,920 0,913 0,836 Result
Indicator
Loading Factor
X5.1 X5.2 X5.3
0,825 0,963 0,959
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable Acceptable
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable Acceptable
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable
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Measurement Model
Result Indicator
Loading Factor
X6.1 X6.2 X6.3
0,956 0,951 0,912
Convergent Validity Measurement Model
Result Indicator
Loading Factor
X7.1 X7.2 X7.3
0,879 0,976 0,979
Convergent Validity
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable
Critical Value
Model Evaluation
≥ 0,7
Acceptable Acceptable Acceptable
B. Average Variance Extracted (AVE)
Table 5: Average Variance Extracted (AVE) Variable
AVE
Planning Factor (X1) Competency Factor (X2) Source of Funding Factor (X3) Business Environment Factor (X4) Educational Factor (X5) Family Factor (X6) Technology Factor (X7) Execution (Y)
0,761 0,893 0,855 0,793 0,843 0,884 0,895 0,507
Critical Value
Conclusion
≥ 0,5
Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable
C. Discriminant Validity The following is an explanation of the validity of the discriminant that includes the value of cross loading Table 6: Cross Loading Indicat or
(X1)
(X2)
(X3)
(X4)
(X5)
(X6)
(X7)
X1.1 X1.2 X1.3 X1.4 X2.1 X2.2
0,867 0,868 0,879 0,876 0,480 0,410
0,378 0,327 0,374 0,386 0,926 0,949
0,518 0,502 0,444 0,463 0,637 0,695
0,757 0,778 0,626 0,623 0,522 0,498
0,470 0,501 0,412 0,442 0,370 0,417
0,412 0,441 0,369 0,378 0,434 0,423
0,482 0,482 0,462 0,472 0,514 0,460
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X2.3 X2.4 X3.1 X3.2 X3.3 X4.1 X4.2 X4.3 X5.1 X5.2 X5.3 X6.1 X6.2 X6.3 X7.1 X7.2 X7.3
0,379 0,309 0,525 0,480 0,528 0,686 0,701 0,747 0,510 0,494 0,440 0,397 0,463 0,434 0,429 0,537 0,569
0,957 0,949 0,704 0,648 0,712 0,439 0,457 0,514 0,361 0,405 0,344 0,364 0,355 0,449 0,401 0,463 0,494
0,752 0,734 0,960 0,848 0,961 0,455 0,538 0,537 0,408 0,601 0,549 0,405 0,380 0,424 0,338 0,475 0,503
0,504 0,474 0,540 0,532 0,522 0,920 0,913 0,836 0,624 0,644 0,592 0,434 0,461 0,448 0,418 0,534 0,570
0,379 0,360 0,488 0,552 0,543 0,615 0,658 0,530 0,825 0,963 0,959 0,365 0,408 0,374 0,351 0,476 0,465
0,362 0,344 0,416 0,384 0,389 0,405 0,407 0,458 0,346 0,404 0,368 0,956 0,951 0,912 0,728 0,742 0,750
0,433 0,405 0,468 0,373 0,455 0,468 0,457 0,517 0,370 0,462 0,426 0,709 0,748 0,743 0,879 0,976 0,979
Reliability The following values are observed in the reliability test which includes values of cronbach's alpha and composite reliability. Table 7: Reliability Test Cronbach's Variable Alpha Planning Factor (X1) 0,904 Competency Factor (X2) 0,934 Source of Funding Factor (X3) 0,955 Business Environment Factor (X4) 0,960 Educational Factor (X5) 0,868 Family Factor (X6) 0,896 Technology Factor (X7) 0,913 Execution (Y) 0,962 Composite Variable Reliability Planning Factor (X1) 0,941 Competency Factor (X2) 0,958 Source of Funding Factor (X3) 0,959 Business Environment Factor (X4) 0,971 Educational Factor (X5) 0,920 Family Factor (X6) 0,927 Technology Factor (X7) 0,946
Critical Value
≥ 0,7
Conclusion Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Conclusion Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable Acceptable
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Execution (Y)
0,962
Acceptable
Outer Loading (First Order)
Indicator X1.1 X1.2 X1.3 X1.4 X2.1 X2.2 X2.3
Table 8: First Order Outer Loading Indicator Indicator t-statistic t-statistic 19,565 28,810 X2.4 X5.1 20,214 68,867 X3.1 X5.2 12,080 12,844 X3.2 X5.3 11,760 60,653 X3.3 X6.1 30,649 27,274 X4.1 X6.2 41,628 26,349 X4.2 X6.3 27,212 13,986 X4.3 X7.1 X7.2 X7.3
t-statistic 11,935 76,293 52,573 70,006 59,344 34,078 15,431 179,713 196,522
Second Order Testing The second order test will be done on the latent formative second order construct by using hypothesis test through resampling method (bootstrapping). Hypothesis Test of Formative Indicators Table 5.23 shows that all first order constructs are construct construct dimensions of successful execution constructs (second order) with t-statistic> 1.96. The latent variables that constitute the successful execution constructs are planning variables, competence variables, funding source variables, environmental variables, educational variables, family variables, and technological variables. Table 9: Second Order t-Statistic Indicator t-statistic Planning Factor (X1) 4,879 Competency Factor (X2) 5,324 Source of Funding Factor (X3) 6,765 Business Environment Factor (X4) 7,375 Educational Factor (X5) 4,588 Family Factor (X6) 8,717 Technology Factor (X7) 7,725
Table 10: Second Order R Square Variable R Square Planning Factor (X1) 0,635 Competency Factor 0,570
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(X2) Source of Funding Factor (X3) Business Environment Factor (X4) Educational Factor (X5) Family Factor (X6) Technology Factor (X7)
0,648 0,714 0,530 0,515 0,609
The conclusion of this analysis is that if the result of hypothesis testing on the outer model is significant, all first order constructs constitute construct dimension of success execution (second order). Conclusion Based on the results of the analysis conducted by the researchers, all research variables in the form of Planning Factors, Competency Factors, Funding Source Factors, Education Factors, Family Factors, and Technological Factors formed the start-up business execution of students at Ciputra University. Based on the measurement model in Partial Least Square (PLS) the sequence of factors that shape the start-up business execution of students at Ciputra University ranging from the highest to the lowest are: Competency Factor (X2), Planning Factor (X1), Technology Factor (X7) Source of Funding (X3), Environmental Factor (X4), Family Factor (X6), and Education Factor (X5). REFERENCES Abdillah, W., & Jogiyanto. (2015). Partial Least Square (PLS). Alternatif Structural Equation Modeling (SEM) dalam Penelitian Bisnis. Yogyakarta: ANDI. Aprilia, K., & Ghozali, I. (2013). Generalized Structured Component Analysis. Semarang: Badan Penerbit Universitas Diponegoro. Atherton, A. (2012). Cases of Start-up Financing: An Analysis of New Venture Capitalisation Structures and Patterns. International Journal of Entrepreneurial Behavior & Research , 28-47. Cai , L., Zhu, X. M., Ci , Q. G., & Zhao, B. (2010). Research on the affecting mechanism of entrepreneurial environment on new firm performance. Journal of Chinese Entrepreneurship , 116 - 128. Ciputra. (2009). Ciputra Quantum Leap. Jakarta: Media Elex Komputindo. Ciputra, & Tanan, A. (2012). Ciputra Quantum Leap 2. Jakarta: Elex Media Komputindo. Herlanti, Y. (2014). Tanya Jawab Seputar Penelitian Pendidikan Sains. Jakarta: Syarif Hidayatullah. Hormozi, A. M., Sutton, G. S., McMinn, R. D., & Lucio, W. (2002). Business plans for new or small business: paving the path to success. Management Decision, 755-763. Kodrat, D. S., & Christina, W. (2015). Entrepreneurship: Sebuah Ilmu. Jakarta: Erlangga. Koranti, K. (2013). Analisis Pengaruh Faktor Eksternal dan Internal terhadap Minat Berwirausaha. PESAT (pp. E1-E8). Bandung: Jurnal Elektronik Gunadarma. Mitchelmore, S., & Rowley, J. (2013). Entrepreneurial Competencies of Women Entrepreneurs Pursuing Business Growth. Journal of Small Business and Enterprise Development , 20, 125-142. Ries, E. (2011). The Lean Start Up. New York: Crown Publishing.
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Sarjono, H., & Julianita, W. (2015). Structural Equation Modeling (SEM). Sebuah Pengantar, Aplikasi Untuk Penelitian Bisnis. Jakarta: Salemba Empat. Setyawati, C. Y. (2015). Eksplorasi Faktor Penentu Keberhasilan Bisnis Start-Up di Kota Surabaya. Management Dynamics Conference , -. Sugiyono. (2011). Metode Penelitian Kuantitatif. Bandung: ALFABETA. Watkins, T.A., Russo, M.J., & Ochs, J.b. (2014). Can students in technology entrepreneurship courses help forster start-ups by the unemployed? Journal of Small Business and Entrepries Development. 348-264.
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BALANCING BUSINESS DIMENSIONAL AND FAMILY DIMENSIONS IN FAMILY BUSINESS: OWNERSHIP APPROACH 1
David Sukardi Kodrat♠
Ciputra University Surabaya INDONESIA Email:
[email protected]
ABSTRACT To balance between business dimension and family dimension with ownership approach should consider three factors: (1) family control, (2) shareholders liquidity, and (3) growth capital. Family control has an influence on the ability to control the company. Shareholders liquidity has influence on the voting rights of shareholders. Last is the growth capital that has an influence on operationalize the company efficiently. Using Sharma's performance matrix, the best type of family business is a professional family business (FB) rather than a family business with family oriented (Fb) or a family business with Business oriented (fB). Although the FB has difficulty balancing the business dimension and family dimension. Keywords: Family Control, Shareholders Liquidity, Growth Capital, Sharma Performance Matrix
INTRODUCTION Family business is different from non family business. In the family business there is a business problem itself (same as non family business) related to competition with competitors either a kind or not the same. The uniqueness in the family business is the existence of family problems and ownership (Davis, 1999). Family issues related to family business are genogram, influential people, and regeneration process. The ownership issue associated with the family business is the controlling shareholder and continues on the offspring. Composition of ownership in family companies in the world as much as 68% of the total go public company is a family ownership. The majority of large companies in the Indonesia Stock Exchange (IDX) about 80% controlled by the family (Atmaja, 2016). This amount of ownership provides sufficient authority to regulate the performance of the company. This means ownership is closely related to the performance of the company and causes to decrease of the agency problem. In general, how to analyze a family business is treated the same as a non-family business. Whereas the purpose of family business is a multi-dimensional goal. There is a business dimension that pursues profitability and growth but behind it there is a family dimension that prioritizes harmony among family members. For that reason, in this literature study will discuss balancing the business dimension and family dimension in family business. LITERATURE REVIEW
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Family business dominates the global economy (LaPorta, Lopez-deSilanes, and Shleifer, 1999). This family business is different from a non-family business organization because of the overlap between the family system and the work system. These controlling family members significantly influence the company's strategic objectives and direction and will ultimately determine the company's performance and viability. To achieve longevity and prosperity, family firms must achieve the efficiency and effectiveness of business goals. In addition, family firms also pay attention to family oriented goals such as harmony, transition generation, and ownership issues. The purpose of family business is a multi-dimensional goal. Often in family businesses, the goals for family harmony, reputation, and continuity are more important than more businessfocused goals such as profitability, growth, and survival. Company performance based on business dimension and family dimension can be grouped into four orientation (Ward, 1987) that is: (1) Fb – Family Business with Family Oriented, (2) fB – Family Business with Business Oriented, (3) FB - Professional Family Business, and (4) fb – Family Business Without Orientation. Sharma (2004) developed a basic matrix to demonstrate the performance of family firms based on family dimensions and business dimensions. High performance in the family dimension helps build capital capacity and emotional resilience in the family, while high performance on the business dimension builds financial capacity. Companies that acquire a high level of emotional and financial capital will increase resilience to overcome challenges and build opportunities as families and corporations undergo different stages of life (Hoy and Sharma 2010). In other words, cell I (FB) as shown in Figure 1 is the ideal position for a family company. However, from time to time, the family company may find itself in one of the other three cells.
CELL 1 (+) Performance on a business dimension (+) Performance on a family dimension FB Emotional capital is high High Financial Capital
CELL 2 (+) Performance on a business dimension (-) Performance on a family dimension fB Emotional capital is low High Financial Capital
CELL 3 (-) Performance on a business dimension (+) Performance on a family dimension Fb Emotional capital is high Low Financial Capital
CELL 4 (-) Performance on a business dimension (-) Performance on a family dimension fb Emotional capital is low Low Financial Capital
Figure 1: Sharma Performance Matrix Source: Sharma, Blunden, Labaki, Michael dan Algarin, 2013 From the results of the research indicates that family firms with clear goals in one dimension or another dimension (Fb or fB) tend to perform better on selected dimensions. In professional family business (FB), the corporate leaders work hard to balance between family goals and business goals. This position is the most challenging. Although constant competition to achieve family and business goals requires serious attention, these ambiguous companies will perform better than family business with family oriented (Fb) or family business with business oriented
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(fB) (Basco and Pérez Rodriguez 2009). The results of Kusumawati (2014) showed that firms with high family ownership had lower agency conflict rates than those with low family ownership. The results of research conducted by Athalia Hidayat and Edward Luwinar on the influence of family control on the financial performance of the company show that: (1) the financial performance of family buainwaa is lower than non-family business, (2) the financial performance of family business under the leadership of the CEO of the next generation lower than the performance of a family business that has a professional as a CEO as well as those still led by the founder (family founder) and (3) the company with the founder as the founder chairman and the next generation as the chief executive (descendant CEO) has the lowest financial performance compared to other board of commissioners-directors (Atmaja, 2016). This is in line with the theory that parents tend not to bear their children. ANALYSIS AND DISCUSSION To balance the family dimensions and business dimensions there are 3 important things that need to be analyzed. First is the family control. The dimension of control is the level of family involvement in: ownership, management and governance functions as shown in Table 1. The level of family control determines the extent to which the family has the potential to exercise power and influence strategic decisions. In the early stages of family business, management and ownership are concentrated in the same person. At the growth stage of family business, there is a change of family control as a result of company transition from one generation to the next which requires big capital for company growth. There is evidence to suggest that corporate performance is affected differently by family involvement in ownership, governance and management determined by the complexity and size of the firm. In small companies, families typically dominate ownership and management teams to help the company's performance as a result of very efficient and slim governance. However, in larger companies it is necessary to open ownership to outsiders to finance growth and encourage company performance. In addition, the complexity of managing large companies requires expertise to manage them so it needs to open management positions for non-families.
Attribute
Table 1: Family Control Dimensions Opportunities
Management 100% non family
100% family Ownership Family with minority stake 100% family Governance 100% nonfamily 100% family
Challenges
Superior management expertise, Agency conflicts: control of given the broader population of nonfamily managers, expensive managers to select from incentives, loss of family-firmspecific culture Efficient leadership, preservation Lack of expertise among family of tacit knowledge managers, conflicts (e.g., altruism) Access to nonfamily capital and Reduction of family influence and opportunities for growth reduced focus on family goals; short-termism Powerful position of family, tight Abuse of power, limited growth control of the firm and its values opportunities Independent advice and control
Loss of family influence
Ensured family control
No access to external expertise and control
Source: Zellweger, Thomas, 2017: 10
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The control dimension is determined by the number of family controls while the complexity dimension measures the complexity of the family control. The complexity of family control increases as the number of family owners and managers increases. The owner-manager constellation shows a fairly simple form of governance with one person having multiple roles as owner and manager. The advantages of this form of governance are the speed and efficiency of decision making, and the absence of owner-manager agency problem. The challenge is the lack of access to external advice and external capital to fund growth and related to succession issues.
Attribute No. of Family owner
No. of Family managers
Table 2: Complexity of Family Control Opportunities
Challenges
1
Efficient and fast decision making Lack of external capital, undiversified owner wealth
2-5
Committed and patient owners
Conflicts with potentially severe consequences because of deadlock
5 or more
Committed and patient owners
Coordination among owners, lack of identification with the firm
1
Efficient leadership, few control problems
Lack of expertise and dedication in later generations, succession problems
Several
Support, commitment, trusted relationships
Relational and task conflicts
Efficient leadership and control
Role overload, responsibility
Culture of commitment and support
Relational conflicts, coordination and communication, identification with the firm
Configuration Owner-manager Cousin consortium
Source: Zellweger, Thomas, 2017: 11 As the number of owners and managers increases, the need to coordinate, communicate and improve family governance is increasing. This need is followed by an increased potential for conflict as shown in Table 2. The main issue of family ownership is that with only 51% ownership, the family can already control a company. That is, the majority shareholder can enjoy private benefits of control at the cost of minority shareholders. The second is the shareholder liquidity. Periodically shareholders in family companies need liquidity to meet family needs. However, growing companies need additional capital. In this difficult situation, conflicts will occur between meeting the needs of the company's capital and the liquidity needs of its shareholders. At large companies usually have made liquidity plans for shareholders. Funding from this liquidity plan comes from internal funds in the balance sheet or from free cash flow of a business, or from external debt or equity capital. There are two approaches to making a liquidity plan (fbcg, 2017): (1) providing a total exit for shareholders wanting out, (2) providing money for those who want to remain shareholders but also seek some personal funds; and (3) a combination Both of which must be determined as part of a family shareholder agreement. "Total exit" is done by entering into a sale and purchase agreement, in which there is pricing and terms of payment. Therefore, a formula for assessment and payment requirements that
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ensures business continuity is required. However, most families will remain shareholders and the owners' family feels a commitment to protecting other interested parties such as employees, communities and future generations of family owners. The valuation of formula is calculated based on the profit and / or book value that has occurred. Payment terms are usually between three to ten years, secured by an interest-paying note, with conditions that restrict payments in case of a company's cash flow issue. The seller's shareholders do not retain the voting role, but may receive a provision that boosts the payout if the business is to be sole in the near future (fbcg, 2017). The more complicated is the means to provide partial liquidity that is the ability to sell a portion of one's shareholdings. The main issue is how the sale of some shares will affect the family's harmony and governance structure. For example, if someone sells half of his shares, does he still have a full vote in the Family Council? Or, will he still receive all the same benefits, like shareholder meeting costs? If large families, corporations can make occasional public bidding for redeem shares. Certain sums are set aside for this purpose and sales are proportionally received to one's holdings. This buyback event can not occur regularly or often without causing significant tax losses. In other cases, the family business "makes the market" in the company's stock by connecting potential buyers and sellers in the family. Still others maintain a standing redemption fund, ready to make purchases at specified prices and terms. Family businesses take this approach in collaboration with their advisers to avoid triggering tax problems. Dividend distribution or partial distribution of corporate profits is a more general way to provide shareholder liquidity. The drawback is everyone has to get a dividend whether they want it or not, the business retention of capital for growth is compromised and possibly high tax costs. Another liquidity plan is to allow shareholders to borrow against their shares. Corporations set up arrangements with banks and guarantee their loans. The advantage is that shareholders do not have to give up their positions of ownership, and corporations usually do not have to have cash first. The disadvantage is that the borrower may overextended and the corporation may be forced to provide collateral. To reduce this risk, some liquidity plans only guarantee about 50% of the value of the stock. Other methods of increasing liquidity (fbcg, 2017) are: (1) taking the business public, (2) having a standby buyer (3) creating an employee share ownership plan / ESOP) and (4) forming a family trust fund Individual needs. Generally, liquidity based on time dimension is divided into 3 namely: immediate, curret, and ongoing. For ongoing can be done by investing in liquid security. This Immediate happens when the shareholder dies or there is a dispute between shareholders so that his share ownership is sold. Current arises from shareholders to meet basic needs. Without flexibility, they are difficult to increase the value of the company. Third is growth capital. Growth of working capital is an excess of current assets from current liabilities is beneficial to operationalize the business today and provide future funding needs. The need for working capital funding is derived from internal cash flow or by optimizing shortterm debt. The more competitive, the greater the need for funds. Good cash management can help solve problems by matching funding needs with cash flow, optimizing processes, and changing performance metrics to build a cash culture and reduce service costs. CONCLUSION To balance between business dimension and family dimension with ownership approach should consider three factors: (1) family control, (2) shareholders liquidity, and (3) growth capital. Family control has an influence on the ability to control the company. Shareholders liquidity has
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influence on the voting rights of shareholders. Last is the growth capital that has an influence on operationalize the company efficiently. All three models can be modeled below:
Family Control Family forces/ Personal constraints
Business tasks / Market constraints
Capital Requirement
Shareholder Liquidity
Growth Capital
Figure 2: Balance of Family Dimensions and Business Dimensions Source: Aronoff, Craig E and John L. Ward. 2011. Using Sharma's performance matrix, the best type of family business is a professional family business (FB) rather than a family business with family oriented (Fb) or a family business with Business oriented (fB). Although the FB has difficulty balancing the business dimension and family dimension. REFERENCES Aronoff, Craig E dan John L. Ward. 2011. Financing Transitions: Managing Capital and Liquidity in the Family Business. USA: palgrave macmillan. Atmaja, Lukas Setia. 2016. Family Control: Madu atau Racun. Koran Sindo, 19 Agustus 2016. Basco dan Pérez Rodriguez, M.J. 2009. Studying the Family Enterprise Holistically: Evidence for Integrated Family and Business System, Family Business Review 22(1): 82 - 95 Davis, J.A. 1999. Preparing Family Business Cases, Harvard Business School Note 9-800-021. fbcg – The Family Business Consulting Group. 2017. Family Shareholder Liquidity, www.thefbcg.com/Family-Shareholder-Liquidity/ Di akses pada tanggal 23 Juli 2017 Hoy, F., dan Sharma, Pramodita. 2010. Entrepreneurial Family Firms. New York: Pearson Prentice Hall. Kusumawati, Ivana Teddy dan Juniarti. 2014. Pengaruh Family Control terhadap Profitabilitas dan Nilai Perusahaan pada Industri Dasar dan Kimia, Business Accouting Review, Vol. 2., No. 1. LaPorta, R., Lopez-de-Silanes, F., and Shleifer, A. 1999. Corporate Ownership Around the World, The Journal of Finance 54: 471 – 517 Sharma, Pramodita. 2004. And Overview of the Field of Family Business Studies: Current Status and Directions for Future, Family Business Review 17 (1): 1 – 36. Sharma, Pramodita; Robert Blunden, Rania Labaki, Nava Michael dan Juan O. Rivera Algarin, 2013. Analyzing Family Business Cases: Tools and Techniques, Case Research Journal: 1 – 20. Ward, J. 1987. Keeping the Family Business Healthy: How to Plan for Continuing Growth, Profitability, and Family Leadership. San Francisco, CA: Jossey-Bass. Zellweger, Thomas. 2017. Managing the Family Business: Theory and Practice. UK: Edward Elgar publishing Limited.
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EFFECT OF EMPLOYEE MOTIVATION, ORGANIZATIONAL CULTURE AND LEADERSHIP ON EMPLOYEE PERFORMANCE PT. L Laksa Adi Hanom Tengtarto, 2Trianggoro Wiradinata♠
1
Ciputra University Surabaya INDONESIA Email: 1
[email protected] ABSTRACT The purpose of this research is to analyze the influence of employee motivation, organizational culture and leadership on employee performance of PT L. This research uses quantitative approach with Multiple Linear Regression Analysis roomates aims to know the influence of employee motivation (X1), organizational culture (X2) and leadership (X3) on employee performance (Y). In this study included in the population are all employees of PT.L. As many as 124 people. The sample in this research is 95 respondents obtained by Slovin formula with Simple Random Sampling method. Technique of collecting data by using questioner with Likert scale (1-5). The results of this study indicate that motivation, organizational culture and leadership have simultaneous influence on employee performance in PT. L. Partially, organizational culture variables influence employee performance while motivation and leadership variables have no significant effect on employee performance PT.L. Keywords: performance, motivation, organizational culture, leadership.
INTRODUCTION Human resources (HR) is a valuable asset for the company, where the entire process of the company always involves this human resources. Any process of achieving company goals can not be separated from the HR element. Decision-making, decision-making process, until the assessment and evaluation process can not be separated entirely from the human element. Successes and failures of a company are often influenced by people in it or from other factors that result from human actions or decisions within the organization. Good performance of the organization can be achieved if the employee's performance works well. Well-motivated employees, organizational culture in a healthy company, and good employee leadership have a profound effect on employee performance within the company. PT. L is one of the medium-sized companies that produce working gloves. The number of employees of this company has reached approximately 160 employees. This diverse employee education background causes the company to be able to direct employees from the company in order to have a common vision to achieve the company's goals. At PT. L there are performance problems that are less than the maximum. Performance is less than the maximum is one of them caused by the timeliness of coming to work or absenteeism with or without explanation. Total from absenteeism, skipping and late from the last three months between 15% - 20%. Many of the employees who often permit or skip for no reason when approaching a holiday or red date It poses a problem in the work at PT. L.
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The above problem is a problem owned by PT. L. These problems are based on an inflexible leadership, lack of motivation, and an unfavorable organizational culture. PT. L. is aware of the problem and is eager to change the existing system better to improve employee performance outcomes as well leader. Problems 1. Is Air employee motivation influence on employee performance PT L.? 2. Is Air organizational culture influences the performance of employees of PT L.? 3. Is ber leadership influence on the performance of employees of PT L.? LITERATURE REVIEW Previous Research In the research of Aristayudha and Netra (2013) in his research on "The Influence of Organizational Culture, Leadership and Motivation on Employee Performance at PT BPD Bali Branch of Renon" stated that Organizational Culture, Leadership and Motivation influence simultaneously to Employee performance in Bank BPD Bali Branch Renon. Research from Aristayudha and Netra is used as a reference because the topic of research in accordance with the topic of the researcher is the influence of organizational culture, leadership and motivation on the performance of the employee. Work motivation Motivation is an individual encouragement of employees who function to raise the spirit of his work to achieve the best performance. According to Winarno (2011) in general motivation has a number of functions, among others as follows: Encourage the emergence of behavior or deeds. Without motivation will not arise an act, such as work, motivation serves as a steering, which means directing the action to achieve the desired goals and motivation serves as a mover, meaning to move a person's behavior. Job motivation can be viewed as a feature that exists in the prospective workforce when accepted to work in a company or organization. According Siagian (2009), defining work motivation is as a driving force for a person to contribute as much as possible for the success of the organization to achieve its goals, with the understanding that the achievement of organizational goals means also achieved personal goals of members of the organization concerned. Theory of Requirement According to Abraham Maslow in the quote (Robbins and Judge, 2008: 226), employees basically work to meet the following needs: a. Physiological needs are the need to eat, drink and get a place to live. b. The need for security is freedom from threats, for example: criminals, and other environmental disturbances. c. Social needs are the need for friends, affiliations, interactions, loving and being loved. d. The need for self-esteem is the need for self-esteem and respect from others. e. The need for self-actualization is a necessity to accentuate themselves or use all their abilities to achieve high achievement. In an effort to fulfill all of his needs a person will behave that is influenced or determined by the fulfillment of his needs Organizational culture Organizational culture has a very strategic role to encourage and improve the effectiveness of organizational performance. According to Susanto (2006: 112) the role of organizational culture is as a tool for determining the direction of the organization, directing what can be done and what not to do, how to allocate resources and manage organizational resources, as well as a tool to deal with the problem of opportunities from the internal circle as well external. Susanto (2006: 112) says there are four roles of organizational culture, namely: 1. Has a significant influence on the economic performance of the organization.
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2. Become a more decisive factor in determining the success or failure of the organization in the next year. 3. Can drive long-term economic performance improvements if the organization is composed of people who are eligible. 4. Formed to improve company performance. Organizational culture permeates organizational life and affects every organizational life. Therefore, organizational culture has an enormous influence on the fundamental aspects of organizational performance (Robbins, 2006: 284). The statement has been widely accepted and supported by several studies linking performance with organizational culture. Leadership Leadership is a process of influencing or giving an example by a leader to his followers in an effort to achieve a planned goal. Some researchers have written the definition of leadership style, such as leadership is the ability of a leader to influence subordinates, leadership is a process that affects the activities of a group in achieving goals, and leadership is the ability to encourage a number of people to work together to achieve a goal (Mulyanto, 2012; Gary, 2010; Djumino, 2012). According to Gary (2010) leadership is a deliberate process of a person to emphasize his strong influence on others to guide, structure, facilitate activities and relationships within groups or organizations. The definition of leadership according to Gary (2010) is more appropriate because leadership is a process undertaken by a leader in order to be able to build good relationships with his subordinates. From some definitions according to experts can be concluded that leadership is a process of influencing others or activities of an organized group to achieve a goal. Style / Leadership Type Different styles are required in different situations and each leader is required to know when to approach the appropriate one. Each leader has a different style of personal leadership and this becomes a leadership strategy. (Lunenberg, 2011). Base is the foundation of autocratic leadership style, bureucratic, laissez-faire, and democratic. In the style of democratic leadership, as is known as a participative style. Encouraging staff to be part of decision makers; Informing staff of informing something that influences their work and sharing in decision-making and responsibility in solving the problem. Democratic leaders plan development to help staff evaluate the performance they have. Performance An organization, be it government or private, always driven by a group of people who play an active role to achieve the goals to be achieved from the organization. The purpose of the organization would not be achieved if the performance of members or employees is not maximal. According Pabundu (2010) performance is the results of job functions / activities of a person or group in an organization that is influenced by various factors to achieve organizational goals within a certain period of time. Various types of work performed by employees, of course, require clear criteria, because each type of work has different standards about the achievement of the results. The more complicated type of work, then the Standard Operating Procedure (SOP), which is set to be an absolute requirement that must be obeyed. The success of an organization is influenced by the performance (job performance) employees, for that each company will seek to improve the performance of employees in achieving organizational goals that have been set. A well-grown and well-preserved organizational culture will be able to spur the organization toward better development. On the other hand, the leader's ability to drive and empower employees will affect performance. RESEARCH METHODS
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Research variable The independent variables in this research consist of motivation, organizational culture and leadership. The dependent variable in this research is employee performance. Population and Sample The population in this research is non-staff employees of PT.L per October 31st, 2016 with 124 employees. Based on Slovin calculation with total population 124 employees, it is concluded that the sample size is 94.65 which then rounded to 95 respondents. The sampling method used was simple random sampling. Simple Random Sampling used in this study because The population of the sample is a non-staff employee whose working authority is relatively the same. Method of collecting data Data Type The type of data used in this study is quantitative research is to obtain data in the form of numbers or qualitative data that is incurred (Sugiyono, 2014) Data Source This study uses primary data that is data obtained from respondents through questionnaires. Data Retrieval Techniques Using questionnaires with a series of systematically arranged questions, then sent to the respondent. Scoring method using Likert scale. The method of measurement is to confront a respondent with a question and then be asked to give an answer "Strongly Agree", "Agree", "Neutral", "Disagree" and "Strongly Disagree". The answers are given a score of 1 for "Strongly Disagree" to score 5 for "Strongly Agree". Data Analysis Analysis of Multiple Linear Regression with the formula of multiple linear regression equation used in this study are as follows: Simultaneous Significance Test (F Test) The conclusion that can be drawn from the F test is if the significance value in the F test is smaller than 0.05 then it shows that there is a significant influence between Motivation, Organizational Culture and Leadership simultaneously to the Performance of PT.L. Individual Significance Test (t test) The conclusion that can be drawn from the t test is if the significance value in the t test is smaller than 0.05 then shows that there is a significant influence between Motivation, Organizational Culture and Leadership partially on the Performance of employees of PT.L. RESULTS AND DISCUSSION Multiple Linear Regression Test Multiple linear regression analysis is used with the aim to know whether there is influence of free variable to dependent variable. Summary of data processing results using SPSS program is as follows Table 1. Constants and Regression Coefficients Variable Constants Motivation (X 1) Cultural Organizations (X 2) Leadership (X 3)
Regression Coefficients
Sig
1,477 0.123 0.519 -0,050
0.000 0.322 0.000 0.591
Based on the above table, the resulting regression model is: Performance = 1,477 + 0,123 Motivation + 0,519 Organizational Culture - 0,050 Leadership
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1. The constant of 1.477 suggests that if the independent variable is considered constant, then the average Performance is 1.477 points. 2. The coefficient of Organizational Culture variable is 0,519 which means if assumed that both other variables are fixed, with the increase of Organizational Culture variable by 1 point then the value of Performance variable will increase by 0,519 points. 3. Leadership coefficient variable is -0,050 but because sig. T test for leadership value> 5% then the leadership variable has no significant effect on employee performance. F Test F test is used to find out whether the independent variable has a significant simultaneous effect on the dependent variable. The criterion of F test is if the significance value in F test is smaller than 0.05 then it shows that there is significant influence between Motivation, Organizational Culture, and Leadership simultaneously to PT.L Employee Performance and vice versa. Based on the F test in Table 5.9. Above indicates that a significant level value of 0,000, which is smaller than 0.05, which means that the variables Motivation, Organizational Culture, and Leadership simultaneously have a significant effect on Employee Performance. T Test T test is done to know the significance of independent variable to dependent variable. The t test criterion is if the significance value at t test is smaller than 0.05 then it shows that there is significant influence between Motivation, Organizational Culture, and Leadership partially on Employee Performance PT.L. The following test results t: Through the statistical test t can be known which independent variables that individually affect the dependent variable. If the significance <0.05 then the variable influences the dependent variable significantly. The result of statistical test t is as follows: 1. Motivation variables have a significance value of 0.322 (sig.> 0.05) which means that the Motivation variable has no significant effect on the Performance variable partially. 2. Organizational Culture Variable has significance value 0,000 (sig. <0,05) which mean Organizational Culture variable significantly influence to variable of performance partially. 3. Leadership variables have a significance value of 0.591 (sig.> 0.05) which means Leadership variables have no significant effect on performance variables partially. Effect of Motivation on Employee Performance The result of t test in the research shows that the motivation variable has significance of t test = 0,322 which have value ≥ 0,05. It can be concluded that the motivation variable (X1) partially has no significant effect on employee performance (Y). From the results of the study can be concluded the initial hypothesis about motivation partially affect the employee's performance can not be accepted. Table 2. Respondents' Answer Tabulation on Motivation (X1) Std. No. Question Mean Deviation 1 I feel I have earned a salary that meets my needs 2,74 0,761 I feel that I have been facilitated by security equipment 2 2,82 0,812 and given safety allowance 3 I can establish a harmonious working relationship 3,60 0,791 4 I get the award according to my achievement 3,24 0,884 5 I find an interesting and challenging job 3,44 0,908 3,17 In this study motivation does not significantly affect employee performance, this is not in accordance with the theory of motivation and performance. The incompatibility of this theory is due to questionnaire questions focused on basic needs such as salaries and benefits while respondents are the lowest level employees where the need for salary and facilities and benefits
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becomes important. The low mean value for questions regarding salaries and safety benefits in Table. With a score below 3 indicating that salaries and benefits become employee priorities. The Influence of Organizational Culture on Employee Performance The result of t test in the research shows that the organizational culture variable has significance of t test = 0.000 which has value ≤ 0,05. It can be concluded that the organizational culture variable (X2) partially significant effect on employee performance (Y). From the research results can be concluded the initial hypothesis about organizational culture partially influence on employee performance is acceptable.
No. 1 2 3 4
Table 3. Respondents' Answer Tabulation on Organization Culture (X2) Std. Question Mean Deviation I feel that disciplinary regulation has referred to the 3,32 0,902 organizational discipline culture I love the culture of organizational discipline culture I feel the organization can adapt to changing issues and environments I run the organizational discipline culture on an ongoing basis
3,55
0,649
3,38
0,760
3,42
0,708
3,42 The Influence of Leadership on Employee Performance The result of t test on the research shows that leadership variable has significance of t test = 0,591 which have value ≥ 0,05. It can be concluded that leadership variable (X3) partially has no significant effect on employee performance (Y). From the results of this study can be implied the initial hypothesis of leadership partially influence on employee performance is not acceptable. Table 4. Respondents' Answer Tabulation on Leadership (X3) No. 1 2 3 4
Question I feel that leaders can help me with my similar conditions and problems I was involved by the leaders in taking action / policy I was given different authority from other employees by the leader I feel the leaders is taking action to develop my skills
Mean
Std. Deviation
3,80
1,088
3,33
0,916
2,79
0,999
3,69
0,968
3,40 In this study leadership has no significant effect on employee performance, this is not in accordance with the theory of leadership and performance. On questionnaire question about the difference of authority of employees has a mean value that is quite low when compared with other questionnaire question that is 2.79. The mismatch of this theory is caused by the questionnaire question "I am given different authority with other employees by the leader" is less suitable for use against respondents considering the level of position of each respondent is more or less the same and at risk of causing multiple interpretations CONCLUSION
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Based on the results of research and discussion, researchers get some conclusions. This conclusion will answer the problem formulation and some other things gained during the research took place, among others: 1. Motivation, Organizational Culture and Leadership has a simultaneous effect on the performance of employees at PT. L. 2. Motivation does not significantly affect employee performance in PT. L. No significant effect was due to the questionnaire focused on basic needs such as salaries and benefits, while respondents were employees of the lowest levels where demand for salary and allowances and benefits are very important. A low mean score for questions regarding salaries and safety benefits with values below 3 (2.74 and 2.82) indicates that salaries and benefits are an employee priority. 3. Organizational culture significantly influence employee performance in PT.L. In Table 5.3. Indicated that the average is 3.42. In this variable, the average value of all statements is almost the same between 3.32-3.55. This happens because the dominant respondents choose to agree and quite agree in this statement so that the respondents consider the organizational culture of the company quite well. 4. Leadership does not significantly influence the performance of employees at PT. L. No significant effect was due to the questionnaire about the difference in mean values of authority employees have a fairly low when compared to other questionnaire is 2.79. Questions regarding the differences of authority is less suitable for use with respondents given the level of office of each respondent about the same and the risk of causing multiple interpretations REFERENCES Aristayudha, A.A.N.B dan Netra I.G.S.K. (2013), Pengaruh Budaya Organisasi, Kepemimpinan dan Motivasi terhadap Kinerja Karyawan pada PT. BPD Bali Cabang Renon, Jurnal Ekonomi dan Bisnis Universitas Udayana Bali, Indonesia. Gary, Y. (2010). Kepemimpinan dalam Organisasi, Edisi Kelima. Jakarta: PT. Indeks Lunenburg, F. C. (2011), Understanding Organizational Culture: A Key Leadership Asset; National Forum of Educational Administration and supervision; Journal Volume 29, Number 4. Robbins, S.P. (2006). Perilaku Organisasi. Edisi kesepuluh. Jakarta: PT Indeks Kelompok Gramedia Robbins S.P. dan Judge T.A. (2008). Perilaku Organisasi, Edisi Duabelas, Penerbit Salemba Empat: Jakarta. Siagian, S. P. (2009). Kiat Meningkatkan Produktivitas Kerja. Jakarta. PT Rineka Cipta Sugiyono. (2014). Metode Penelitian Kuantitatif, Kualitatif dan R&D. Bandung : Alfabeta Susanto. (2006). Strategi Organisasi. Yogyakarta: Amara Books. Winarno. (2011). Pengembangan Sikap Entrepreneurship dan Intrapreneurship. Jakarta: Indeks.
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ANALYSIS OF INTERNATIONAL MIGRANT WORKERS (CASE STUDY OF WORKER OF MADURA ORIGIN) 1
R.M Moch Wispandono, 2Makhmud Zulkifli, 3Eni Sri Rahayu N, 4Deni Setya Bagus Business and Economic Faculty University of Trunojoyo Madura INDONESIA E-mail:
[email protected] ABSTRACT As international migrant workers they should equip themselves with the necessary education and skills to compete with other overseas workers. This means that international migrant workers need to improve their quality and ability to compete in jobs in the global job market. In addition it is also required a high work motivation to produce a satisfactory performance. The capabilities needed to support performance are cognitive, affective, and psychomotor abilities. These three abilities together with their work motivation are instrumental in digging and analyzing international migrant workers from the island of Madura. Based on the results of qualitative research using interview technique and observation on three informants who had worked abroad as nursing, baby sitter, and housekeeper whose data validity of interview result is measured using triangulation method shows different ability in running his job (though having the same work motivation) resulted in the resulting performance is also different. Low performance due to lack of ability in cognitive, affective, and psychomotor aspects resulted in workers who could not compete with other workers. This is evident from the lack of contract extension for low-performing workers. It is therefore recommended for prospective international migrant workers to equip themselves with sufficient capacity through trainings undertaken by Balai Latihan Kerja (BLK)/. Keywords: International migrant, ability, motivation, performance, competitive.
INTRODUCTION The many problems faced by labor in Indonesia such as: the low quality of labor, the unequal labor force, the unequal distribution of labor and unemployment must be seriously handled by the government, the private sector, and the public through a study, Studies, and scientific discussions that can provide input to the government in making the right policy in the field of employment. However, it is not an easy task to solve the problems of employment in Indonesia. This is because of problems from the side of its own workforce other than the outsider of labor. In terms of its own workforce the problems that arise are the low quality of education and skills possessed in addition to the bad mental attitude that most Indonesians have shown in the form of: quick surrender, low fighting power, and not future-oriented. These problems lead to low competitiveness in the world of work, especially in the global job market today. The low competitiveness of Indonesian human resources can be seen from The Human Capital Report
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2016 released by World Economic Forum (WEF) which shows the competitiveness of Indonesian human resources is so low because it is in the order of 72 of 130 countries. This sequence puts Indonesia under the shadow of other ASEAN countries such as Singapore, Malaysia, Thailand, the Philippines, and even we are outranking Sri Lanka that has penetrated the top 50 ranks. On the other side to get the solution from economic crush of worker's family and to get around unemployment because of the very small number of employment and unbalanced with number of worker in Indonesia, they work abroad as international migrant worker with low education and skill that can be categorized As uneducated and untrained workers who most of them work as casual labor (such as factory workers, construction laborers, housemaids, rubber tappers, etc.). As international migrant workers they should equip themselves with the necessary education and skills to compete with other overseas workers. This means that international migrant workers need to improve their quality and ability to compete in jobs in the global job market. One of the solutions to improve the quality of the workforce is through empowerment of workers through the Training Center organized by the government and private (Indonesian labor service delivery companies), especially the improvement of quality for people who lower high school education level because they usually only have low skills And unable to continue to higher education. Training Center is one of human resource competency development instruments that is expected to transfer knowledge, skills, and productive work attitude with various curriculum and existing programs. Development of human resources at the Training Center through training activities is a nonformal education program. According to the Law of the Republic of Indonesia No.13 Year 2003 article 1 clause 9 job training is the whole activity to give, gain, improve, and develop work competence, productivity, discipline, attitude, and work ethic at certain skill level and skill according to level And job and job qualifications. Through job training is expected to equip, improve, and develop work competencies to improve the ability, productivity, and prosperity of prospective workers. Madura Island is known as an island whose people like to wander both domestically and abroad. Maduranese are known to be wanderers since time immemorial because the jobs in the island of Madura are very limited due to the fact that their land structure is not good for farming, nor is there a rapidly growing industrialization that can provide jobs for Maduranese. Even though the existing suramadu bridge operated since 2009 has not had a significant impact on economic and industrial growth on the island of Madura. Various studies ever conducted on Maduranese (De Jonge, 1989; Warsono, 1992; Suhanadji, 1998) who have been migrants show that their reasons for being migrant workers are: (1) to improve the family economy, (2) low level of education to find employment in Indonesia, (3) they do not have Expertise to work in his area, (4) easy to find employment abroad without high education certificate, (5) high salary / wage earned to become overseas migrant worker, and (6) join husband work abroad. Based on the above background then the question of this research is: What is the ability of the competitiveness of international migrant workers coming from the island of Madura? LITERATURE REVIEW Migration is a demographic component that influences the population dynamics in addition to fertility and mortality. According to RozyMunir (2000) migration is the migration of residents with the aim of settling from one place to another beyond political or state boundaries or administrative boundaries or inner boundaries of a country. Migration is often interpreted as a relatively permanent move from one region to another. There are two important dimensions that need to be reviewed in the migration review, which is the time dimension and the dimension of the region. For the time dimension, the exact size does not exist because it is difficult to
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determine how long a person moves a residence to be considered a migrant, but usually used the definitions specified in the population census. According Rogler, Lloyd (1994) there are two approaches in assessing the phenomenon of international migration: the theoretical approach that explains the initial process and causes of the initiation and theoretical approaches that describe the process after the migration (continuation). One example of migration theory that uses an initiation approach is neo-classical theory. This theory states that the main cause of labor migration is due to differences in wages (income) between different regions. If these wage differentials continue to be allowed then it is ensured that migration flows from low wage regions to higher paying areas will be even greater. The higher the migration it will be ensured the greater the remittance obtained by the country of origin. Analogue with this theory is the findings of research conducted by Lee (1966) and Zelinsky (1971) in the wirawan (2006). Both researchers said that the main motive that causes a person to migrate is an economic reason. While the theory that explains the international migration of the continuation approach states that as a result of migratory flows there is a network of migrants involving interpersonal networks between the migrant population in the place of origin and destination. This migrant network provides assistance to potential migrants from the home areas in both information and financial form. Dual labor market theory argues that international migration is only caused by pull factors from developed countries as the recipient country of migration. This theory explains that the labor market can be divided into two segments namely the main segments and additional segments. The main segment has the characteristics of capital-intensive production methods and is dominated by skilled labor, while for additional segments it is characterized as having laborintensive and predominantly labor-less labor methods. International migration occurs when there is demand for labor in additional segments of the recipient country. Based on a research report entitled IMD World Talent Report 2015 presented by the Institute of Management Development (IMD) by conducting surveys in 61 countries including Indonesia for talented and skilled talent ranking in 2015 aimed to assess the extent Where a country is attractive and able to retain the talented and skilled workers available in the country to participate in the economy of a country - shows that Indonesia is downgrading. In 2014 Indonesia was ranked 25th but in 2015 Indonesia's ranking fell by 16th place to rank 41. The position of Indonesia is far below the position of neighboring countries such as Singapore, Malaysia, and Thailand. This ranking is based on the calculation results with certain weights that consider the three factors of development and investment factors, factors of attractiveness of a country, and the factors of human resource readiness. Each factor is subdivided into several other details. For the first two factors, Indonesia has the same relative rank as the previous year. However, for the third factor, the readiness of human resources is the most dominant factor contributing to the declining rank of Indonesian skilled workers in 2015. In 2014, Indonesia is still ranked 19th of 61 countries for this factor. However, in 2015, Indonesia's workforce readiness ratings fell to rank 42. The readiness factor of Indonesian workers is still less able to compete with other countries in 2015. For this factor, Indonesia only excel in the quantity (growth) of labor force where Indonesia Ranked fifth. Other indicators such as education system, managerial education, senior manager's competence, international experience, and language skills are ranked above 30. Even for financial skills, Indonesia is ranked 44th. This shows that the performance of human resources in Indonesia is still low. Given that the actual performance is also a behavior in work, and behavior is a function of the relationship between the organism and the stimuli in the form of both physical and socio-cultural environment leading to a fulfillment then the performance is formed from the combination of such relationships. That is, there are individual characteristics and characteristics of the environment that shape performance.
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From an individual point of view, performance can be formulated as a result of multiplication between motivation and ability. Morf (in Ancok, D. 2007) mentions motivation and ability as competence. Motivation with regard to desire or willingness to perform work. It is the duty for the leadership to create the willingness of his subordinates. Without a willingness to work, even if an employee has the ability to work, then the expected performance will not happen. Vice versa, although an employee has a willingness to work but does not have the ability to work, the expected performance will not happen. Both become the main elements for the creation of the expected performance. To support the importance of competence, findings from research conducted by Rahman, Hesham (2002) can be used as a reference. They found that the individual performance in a successful group was negatively related to the business dimensions (from -0.09 to -0.22), and positively correlated with the ability dimension (from 0.40 to 0.29). While the individual performance in the failed group was negatively related to the ability dimension (from -0.36 to 0.33), and positively correlated with the business dimension (from 0.32 to 0.33). One of the breakthroughs that can be done to overcome the problem of the quality of Indonesian workers in order to improve performance and competitive is through the improvement of the role of vocational training center (BLK). BLK's contribution in improving migrant skills is in the form of providing and training the world's workforce. Through training, the demand to improve the quality of human resources in order to be able to compete to enter the local and global work market can be achieved. This is because the training can improve, and develop work competencies to improve the ability, productivity, and welfare of prospective workers. Ontologically, the definition of training as stated by Friedman and Yarbrough (in Dessler, 2015) is as follows: “Training is a process used by organizations to meet their goals. It is called into operation when a state of affairs is a state of affairs. The trainer's role is to faciliatate trainees' movement from the status quo to the ideal”. The definition indicates that training is a learning effort, organized by organizations (government agencies, non-government organizations, corporations, etc.) to meet the needs or to achieve organizational goals. The background of establishing a BLK in the labor service environment is due to the classic problems that arise in employment in Indonesia that are prospective applicants / job seekers many who do not have adequate capabilities as requested by the users. The existence of encouragement and demand from the world of work (the users) so that the government can facilitate the availability of job seekers who can meet the qualifications they need is another reason for the existence of BLK. This is in line with the basic task of the UPTD BLK Dinsosnakertrans Bangkalan which has the task of performing some technical activities in the field of skills training, knowledge, and administration, and management of the Training Center which is under and responsible to the Bupati through the Head of Social Service, Manpower and Transmigration. The tasks carried out by UPTD BLK Bangkalan above can not be separated from the UPTD functions contained in the local regulation (Bangkalan District) no. 16 year 2011, where there are various functions inherent in the BLT UPTD, among which are: Collection of materials operational implementation of service activities and dissemination of information field training; Preparation of methods, curriculum, schedule and training aids; The empowerment of training facilities; Collection of materials for the implementation of coordination and cooperation with related institutions and other institutions in the field of labor training; Collection of materials for the implementation of supervision, evaluation and reporting in the field of labor training. Competency-based training organized by BLK Dinsosnakertrans Bangkalan District is held annually in accordance with the budget received from the central government. So far BLK Dinsosnakertrans Bangkalan District has conducted training for 7 (seven) vocational areas
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where each capacity training is 16 participants per batch. In one year BLK Dinsosnakertrans Bangkalan District conducts training five times (armed forces) for each area of competence. Thus, since it was established in 2012 until the middle of 2016 BLK Dinsosnakertrans Bangkalan District has graduated 1,485 trainees. The target of the training in the BLK is not to seek work for the graduates but instead to seek skills trained for about one month on weekdays with the duration of the training starting at 08.00 to 16.00 or the equivalence of the training being held for 240 hours per force. Training participants in BLK Dinsosnakertrans Bangkalan District is not limited only Bangkalan residents but may be from outside Bangkalan district as long as the relevant has a KTP and aged about 18 years up to 35 years. RESEARCH METHODS The analytical unit in assessing international migrant workers is migrant workers who have worked overseas for at least 3 years. A minimum 3 year limit is intended to extract information from them about all the abilities and motivations they have and do during the work (migration process) in a country. For example: how they are able to carry out the job that is his responsibility until the employer is satisfied with the results of his work. In addition to the criteria of at least 3 years, the selection of informants also concerns the level of education, gender, and domicile in the destination countries: Saudi Arabia, Oman, and Kuwait. This is because most Madurnese prefer to work on the peninsula of Arabia or the Middle East (Arab countries) for religious reasons in which the Maduranese are known as tribes who are devout to religion (Islam) so it is appropriate that they work in an Arabic country that is identical to Islam . Determination of informants in this study was conducted by purposive sampling by taking informants of different destination countries. Taking informants from Maduranese tribe is because the Maduranese known as immigrants since a long time ago. Even according to the results of a study in 2016 as many as 50% of Maduranese migrate to work outside the island of Madura. It is interesting to find out, however, that if a migrant worker is a woman it will be seamlessly permitted by her husband or family. In determining the amount and timing of interacting with data sources, researchers used the sampling concept recommended by Lincoln and Guba (in Sudarwati, 2014), ie maximum variation sampling to document unique variations. The researcher will stop the data collection if from the data source is no longer found new variety. With this concept, the number of data sources is not the main concern, but rather the complete acquisition of information with the diversity that exists. Data collection is done by unstructured interview technique and observation (observation). This is done to avoid the rigors of the interview. Even interviews in this study are often done spontaneously, ie not through an agreement of time and place first with the informant. In this way researchers always try to take advantage of opportunities and the most appropriate places to conduct interviews. This study uses primary data and secondary data. Primary data obtained through the results of in-depth interviews directed directly to research samples and government agencies related research topics, namely the Office of Social-Manpower, and Transmigration. Secondary data used is real time and valid data obtained through desk review policy Bangkalan regency and references related to the research topic The trustworthiness of the data in this study was conducted with four criteria as recommended by Lincoln and Guba. They are: credibility, transferability, dependability, and confirmability. In order to increase the degree of confidence in data acquisition, done by triangulation method. Triangulation method is the technique of checking the validity of data that utilizes something else outside the data for the purposes of checking or as a comparison of the data. Four common types of triangulation are the use of sources, methods, researchers and theories (Patton, 1987; Moleong, 1999; Sutopo, 2002: 78). In this research the validity or stabilization and the truth of
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information is achieved by using two triangulation techniques namely: Source triangulation and triangulation of researchers. The data analysis in this research is through an analytical work process consisting of three activities. The process occurs simultaneously as an interconnected before, and after data collection. The three activities are data reduction, data presentation, and conclusion drawing (Koentjaraningrat, 1986: 269). This process of analysis is carried out simultaneously with the data collection process. Three components of the above analysis, the activity is in the form of interaction with the data collection process so as to form a cycle that is done continuously. With this form the researcher keeps moving between the three components with the data collection component during the research process. After rough data in the form of notes written from the field, interviews, photographs, library books, and other references collected then data reduction begins. Furthermore, the data is processed and summarized in accordance with the research questions, then just made a final report of writing. FINDING AND DISCUSSION Delivery of Indonesian labor abroad mostly to meet additional market segments. That is, they work as uneducated and trained workers. As a result labor migration abroad has problems. The problems that arise, among others, are due to the lack of work skills possessed, resulting in a lack of maximum productivity of their work in various countries often resulted from the wage earned by Indonesian migrant workers under the wages received by migrant workers from other countries. This condition proves that the Indonesian government has not been maximized to empower the migrants although the Indonesian embassy has been extending the work system to better understand how the employer wants employment (ELSAM, 2002). In addition, international migrants are faced with different working environment situations in their hometown. They are required to quickly adapt to their new work environment abroad. Taking into account the above conditions, in this study the analysis of international migrant workers is directed by using the approach: the ability and motivation of migrants. The use of both approaches is consistent with Vroom theory developed by Morf which states that the factors that affect a worker's performance are ability and motivation based on re-research conducted by Rahman, Hesham (2002). Capability Approach Man created by Allah SWT equipped with the ability to meet the needs of his life. Various abilities possessed by humans can be grouped into cognitive, affective, and psychomotor abilities. These three abilities play a role and influence in determining a worker's performance. Cognitive Ability Cognitive abilities are oriented toward thinking skills that include intellectual ability, ie remembering, understanding, applying, analyzing up to the evaluating capabilities that require workers to link and incorporate some ideas, ideas, methods or procedures learned to solve problems in the job. Cognitive ability refers to the ability in the field of mastery of knowledge owned by a worker. In carrying out any work and from any profession cognitive ability is required to expedite a worker's work. Ibu Latifa (a migrant worker from Bangkalan who works in Oman) before becoming a migrant worker has equipped himself with knowledge about the work to be handled in the destination country. This is evident from the essence of interview result as follows: "I before going to have attended a training organized by BLK. In the training for 2 weeks I was given the material knowledge of how to run the job of caring for the elderly. So when in Oman country I'm not confused anymore with my job as a nursing nurse,
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including when there is a problem in doing my work I can solve that problem based on the knowledge I get when I attend " A similar but not the same experience was experienced by Farida's mother (a migrant worker from Sampang who works in Kuwait). Ibu Farida who previously worked as a baby sitter in Surabaya went to work in Kuwait as a baby sitter so that when she attended training before leaving for destination country she followed it only for formalities only. This is revealed from the following interview summaries: "Since I went to Kuwait to work as a baby sitter, the work I have handled there is nothing new for me. My love for a baby who supports me works maximally to care for my employer's baby. Moreover my employer is a good man. " Different things experienced by Saodah (migrant workers from Pamekasan working in Saudi Arabia). Saodah who went through PJTKI had problems in doing the job as a housemaid. This is revealed from the following interview summary: "Although I have attended training held by PJTKI but when I run a job at home employers in Saudi Arabia I have problems when told to cook Arab cuisine. Frankly in Indonesia I never cook " The various answers given by the informants above show that not all informants have cognitive abilities appropriate to those required by the work undertaken by the informant. Cognitive disadvantages in carrying out the work cause not maximal performance that causes low worker competitiveness. This is evident from that experienced by Zaroh, namely he does not renew his contract term. While Latifa's mother and Farida's mother because they have adequate cognitive skills in carrying out their work then the term of his contract is extended. Affective Ability Affective ability refers to the domains associated with attitudes and values. Affective domains include behavioral traits such as feelings, interests, attitudes, emotions, and values. Some experts say that a person's attitude can be predicted when someone has a high degree of cognitive power. The affective ability of the worker appears in various observable behaviors ranging from being able to receive or pay attention to something, responding (meaning "active participation"), judging or appreciating, organizing or organizing, to characterizing a value. This affective ability also plays a role in performance formation. This can be seen from the results of interviews conducted on the three informants above. In relation to this ability the results of interviews with Latifa's mother can be summarized as follows: "As I work for caring for the elderly, my priority is my caring and compassion for her to have a passion for life. This is evident when I feed him the food that is happily responded to. Similarly, when I cleanse his body with tenderness, he seems happy. " While the results of interviews with Farida's mother about this cognitive ability can be described as follows: "It's impossible to take care of a baby without any love for him. Moreover, babies can not understand the words of adults. But with touch and love the baby can feel my warmth and concern for him. This is reflected from the baby's face when I am nearby. " While Saodah has different experiences about this affective ability. Saodah has a view that can be written as follows.
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"Actually I'm not interested in working abroad as a housemaid because I know the job as a maid must be very much. Starting from sweeping, mopping, cooking, washing, ironing, etc. Imagine working in an employer's house with a family member of 9 people and having only one maid ". It is not surprising then that Saodah's contract term was not extended by her employer and was forced to return to Madura because Saodah was in terms of Cognitive ability, affective inadequate as a migrant worker. Psychomotor Ability The psychomotor domain is a domain related to skill or ability to act after a person receives a particular learning experience. Psychomotor learning results are actually a continuation of the results of cognitive learning (understand something) and the results of affective learning (newly seen in the form of behavioral trends). The psychomotor aspect is related to physical activity, such as running, painting, washing, cooking, sweeping, and so on. The results of skills learning (psychomotor) can be measured through: (1) direct observation and behavioral assessment during the process of running the work, (2) after the training, by giving the test to learners to measure knowledge, skills and attitude, 3) some time after work finishes the job. The three informants have different psychomotor abilities because the job objects are handled differently. Suppose Ms. Latifa does the job of caring for the elderly. At the time of the interview while he was performing the activities of undressing, washing the body, dressing, hair washing and feeding his elderly parents, it was apparent that Latifa's mother was skilled in carrying out the activity so that it could be imagined with the same work done in the State Oman then Latifa's mother could be said to have excellent psychomotor ability. Similarly, Farida's mother when she conducted the interview while carrying out the activities of caring for the baby from her new siblings 3 months of giving birth, which is to prepare for bathing, bathing the baby, trim her hair, put on baby clothes, powder the baby, until her baby nephew 3 months It appears that he is deft (skilled) in caring for and caring for babies. Moreover, it appears that in taking care of the baby, Farida's mother did so lovingly so that the baby's face look happy to be treated by Farida's mother. Therefore, it can be dianalogkan when Farida's mother runs a job as a baby siiter in Kuwait then his psychomotor abilities the same as when he runs activities nursing his nephew who is 3 months old. A different thing is found in the third informant, Saodah. When the observation is not directly done when he asked his parents to cook food it appears that he is in the cooking process does not memiki skills required for it. For example, when frying crackers and tempeh, the fire stove was raised and as a result fried crackers and tempeh into black bitter (burned, Javanese term). Therefore, it is only natural that his presentation in Saudi Arabia does not extend his contract term. Based on the findings of the three informants mentioned above for the above three can be stated that the above three functions play a role and influence on the formation of a worker's performance and this is in accordance with that stated by Ulrich (Dessler, 2015) based on performance theory proposed by previous HRM experts that one of the factors Contributing to a person's performance is the ability he or she possesses in carrying out the work in hand. Motivation Motivation that comes from word to movere has a sense of encouragement to do something to meet the needs. Everyone has a different motive for doing things, but basically doing something in order to meet an urgent need. Similarly, international migrants from Madura who are willing to sacrifice to work far across the sea, hundreds or even thousands of kilometers traveled by
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leaving family, relatives, neighbors in his village no other in order to meet the needs of his life that is felt not fulfilled if for example they To migrate and work only in Indonesia. The results of previous research as stated at the beginning of this paper indicate that their motive as an international migrant worker is one of them is in order to improve the welfare of the family, which nota bene want to get a salary / wage is greater than if working in Indonesia. This indicates that the fulfillment of physical needs, such as: clothing, food, boards (houses) are the main reasons they work abroad. This is only natural because there is no one in the world who does not want to have enough money to be able to buy food, clothes, houses, and so much better and better. Similarly, the results of interviews and observations of the three informants of this study showed no different motives. Mrs. Latifa, for example. He is willing to part with family and relatives in his hometown just for the sake of having money to meet the needs of the family. This is summarized from the interview: "Alhamdullilah while working 6 years in Oman country I can raise a lot of money to meet the needs of children and families. I can buy a motorcycle, build a house, send my children to school, and meet their food needs. More money from my work in Oman I tube for family purposes in the future " Similarly, Farida's mother has a similar motivation to Latifa's mother. Mrs. Farida is willing to work in Kuwait thousands of kilometers away from Madura because in a country rich in wealth due to the sale of oil mines so that the level of prosperity of the population is higher than the population of Indonesia dare to give salary / wage to large migrant workers. This is felt as a blessing for Farida's mother revealed from the interview result which summarized as follows: "I am very happy to work in Kuwait for a far greater salary rewards than working as a baby sitter in Indonesia. Alhamdullilah the term of my former employment contract was extended to 2 times. Actually want to be extended again the contract but due to family reasons in Madura then I was forced to go back to Madura. Hopefully next time I can still go back to work in Kuwait ". While Saodah also have the same reason with the two informants above. He wants to work abroad because he wants to earn the great salary he needs to help the family economy. Unfortunately he worked in Saudi Arabia for only 3 years and his contract term was not renewed by his employer because his employer was disappointed with Saodah's performance in performing his job as a housekeeper. Based on the expression of the three informants above can be stated that their motivation to work there is to meet the physical needs, namely: clothing, food, and boards. These physical needs are perceived by them as primary needs (principal) that must be fulfilled even by working away from home. Fulfill the physical needs of migrants as primary needs in accordance with motivational theory developed by A. Maslow. Maslow in his theory expressed as the hierarchical model of human needs explains that human life basically has five tiered needs (hierarchy) that start from physical needs, the need for security, social needs, reward needs, and actualization needs of. According to A. Maslow man will not move to a higher level of need before the needs at the previous level are met. Thus, if we observe the motives of migrants working abroad then they are only at the level of fulfilling the most basic needs of the hierarchy of human needs proposed by Maslow. For the needs of security, social, and other needs for them difficult they get even though these needs they need to be met. This is because they are in a new social environment that actually requires them to quickly adapt to the social environment in the destination country. The
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example of Latifa's mother at the beginning did not yet know the culture held by the people there so that he was assisted by his employer must understand how the condition or environment of the community there. While in the country of Oman, Latifa's mother seldom talks or talks with neighbors. Different cultures cause Latifa's mother to have difficulty adapting so that she rarely communicates with Oman citizens, other than her employer and family. A similar experience has also been experienced by Farida and Saodah's mothers where they find it difficult to adapt to their new environment different from their home country. In such conditions, psychological social problems are very potential to emerge. In addition, migrants belong to a group that is classified as risky to be treated unfairly. This phenomenon encourages migrants to build social networks in the destination areas. These efforts can lead to the development of relationships with the natives of the destination area as well as fostering the fraternity of migrants into new communities. These social networks have different characteristics and strengths in their survival and welfare improvement efforts. For example, Indonesian migrant workers who work as domestic servants in the Arab country have a new social network completely different from the old network while still living in the area of origin The existence of a social network formed by migrants proves that while in the country people need social needs to be met. This is in accordance with the nature of human beings as social creatures that require interaction and communication between people with each other. CONCLUSION Based on the analysis of international migrant workers (case study of migrant workers from Madura island) it can be concluded that the extension of the contract period can be done if the migrant worker has a good or satisfactory performance in the eyes of the employer. While performance is a function of ability and motivation. Thus if a migrant worker wants to have a high performance then the concerned should improve his ability, both cognitive, affective, and psychomotor skills. In addition must have good skills, then the motivation of work also contributes to the formation of performance. A worker who has low work motivation then it can be ascertained the performance will be low. The results of this study support the motivational theory proposed by Vroom, Morf, Ulrich, and A. Maslow. The essence of their theory is that the formation of performance is necessary for the improvement of competitiveness in the struggle for the labor market. Based on the results of this study also can be concluded that not all international migrant workers from the island of Madura have no competitiveness with other workers. For workers who have good cognitive, affective, and psychomotor skills as well as high motivation in work support for high performance creation. It is therefore recommended for prospective migrants who will work abroad to pay attention to both factors. REFERENCES Dessler, gary, 2015. Human Resource Management. 14th Edition. Florida International University. Ding LU, 2002. Rural urban income disparity: impact of growth, allocative efficiency, and local growth welfare, China economic review 13, pp. 419-429. Dinsosnakertrans Kabupaten Bangkalan, 2015. Profil Unit Pelaksana Teknis Dinas Balai Latihan Kerja. Djamaluddin Ancok, 2007. A positive psychology approach in building a quality society. Proceedings of the National Conference on Stress Management, Bandung. ELSAM, 2002. Migrant Labor Migration Statistics in Singapore, Newsletter May-June edition Fendy Levy Kambey and Suhartono, 2013 "The Influence of Coaching, Training and Development", Journal of Management and Organizational Studies, Vol. 10: 2. Pp 149.
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Jonge HD. 1989. Madura dalam empat zaman: pedagang, perkembangan ekonomi, dan islam. Jakarta [ID]: Gramedia. Magnus Blomstrom, et.al. 2003. Japan's New Economy: Continuity and Change in the Tweenty First - Century. Oxford University Press Mondy, R Wayne, 2008. Human Resource Management, Volume 1 Ten edition, Erlangga, Jakarta. Munir, R. 2000. "Migration", Demographics Basics. Edition 2000. Lembaga Publisher UI: Jakarta Muhidin, Syarif, M. Fadhil Nurdin and Teti Asiati Gunawan (2003), "The Study of the Problems of Indonesian Migrant Workers (TKI) of West Java in Saudi Arabia and Hong Kong as the Formulating Materials of PERDA" in Sosiohumaniora, Vol.V, No.1 Peirce, Neal. R., with Curtis W. Johnson and John Stuart Hall., 1993. Citistatees: How urban America can prosper in a competitive world. Washington, DC: Seven Locks Prijono Tjiptoherijanto. 2000. "Urbanization and Urban Development in Indonesia". Www.geocities.com Ravenstein, 1985. Migration Theory. Center for Population Research UGM. Yogyakarta Rahman, Hesham., 2002. Does the structure of an urban system affect income disparities? Journal of regional science, Vol. 42, No. 2, pp. 389-410. Rogler, Lloyd. 1994. International migrations: A framework for directing research. American Psychologist, Vol 49 (8), Aug 1994, 701-708. Http://dx.doi.org/10.1037/0003066X.49.8.701 Solimano, 2001. The International Mobility of Talent: Types, Causes, and Development Impact. Oxford University Press, New York. Sudarwati, Yuni, 2014. INDONESIA'S EFFORTS TO FACE MIGRATION OF LABOR IN THE ASEAN ECONOMIC COMMUNITY 2015. Journal of Economics & Public Policy, Vol. 5 No. 1, June 2014 15 – 28 Suhanadji. 1998. Migrasi dan adaptasi orang Madura di Surabaya (kajian perilaku ekonomi migrant madura di keluraahan Sidotopo, Kecamatan Semampir, Kotamadya Surabaya). [tesis]. [Internet]. [30 September 2011]. Jakarta [ID]: Universitas Indonesia. Dapat diunduh dari http://digilib.ui.ac.id/opac/themes/libri2/detail. jsp?id=77600&lokasi=lokal. The Institute of Management Development (IMD), 2015. “IMD World Talent Report 2015” a research report. Todaro, Michael P. 2006. Economic Development in the Third World, Jakarta: Erland Warsono. 1992. Strategi adaptif migran madura di Surabaya khususnya bagi golongan kenek. [tesis]. [Internet]. [16 November 2011]. Jakarta [ID]: Universitas Indonesia. Dapat diunduh darihttp://eprints.lib.ui.ac.id/12757/1/81906%2DStrategi%20 adaptif%2DTOC%20(T9624).pdf. Wirawan, 2006. The psychology of Indonesian prejudice: a collection of empirical studies of prejudices in various aspects of Indonesian life. Publisher RajaGrafindo Persada, Jakarta. Regional Regulations / Legislation Regional Regulation of Bangkalan Regency no. 16 in 2011 Law of the Republic of Indonesia No. 13 of 2003 Act No. 6 of 2012 on Ratification of International Convention On The Protection Of The Rights Of All Migrant Workers And Members Of Their Families
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FEASIBILITY STUDY OF HUMAN RESOURCES INFORMATION SYSTEM APPLICATION IN PMC HOSPITAL JOMBANG 1
Randi Andika Hutama, 2Denny Bernardus♠ Ciputra University Surabaya INDONESIA Email:
[email protected]
ABSTRACT PMC Hospital Jombang is the largest D type hospital in Jombang regency. Most of companies in Jombang mainly use manual system in processing employee data; therefore, it may cause errors while creating report and takes more time to prepare data. The company needs to apply a system to support Human Resource Department (HRD) to overcome this problem. A trial has been performed on the system by input several data such as employees’ data, length of employment contract for old employees, follow-up training, rules violations, and assessment of performance. Based on the implementation and trials of the system, the employee information system at PMC hospital has been able to provide expected result of information that needed by the management. Furthermore, reports that can be generated from the system are attendance reports, assessment of performance reports, reports of violations and training reports. Keywords: Employee, Information system, Violation
INTRODUCTION The development of science and technology, including the world of information technology has been increasing rapidly which affects the improvement of services to most of business companies. There are only few company or institutions that take advantage of the advancement in information technology to complement and support the business. It encourages government and private institutions to do various ways to support their business and begin to take advantage of advancement in information technology to support the management to deliver the information effectively. Management activities which supported by technology and information are not only require hardware but also software. They help to support the information system running expeditiously; therefore they must be suitable or compatible. Hardware will determine the speed of access while the software provides an important role for the smoothness of institutions’ activities, such as the ability to perform data processing, storage, and access required information promptly and accurately. The presence of software is expected to store existing data so that they can be easily accessed and processed. The activity of data accessing and processing becomes an important component related to the development and advancement of many institutions. One of the institutions is in the health sector such as hospital. As a public health service, hospital, will serve patient transactions and daily monitoring activities. The provision of services and actions in many cases will affect the
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patient's condition. Fast response is required because of involvement in patient’s life. If the hospital has wider range of services, there will be more complexity in types of actions and services that need to be delivered in an integrated coordination. It is not only to provide services, but also to manage funds to finance the operations. Due to this situation, hospital needs to install Hospital Information System (SIRS) to handle the data processing activities which done manually beforehand. Information technology is potential to increase efficiency and effectiveness in the institution. Efficiency is a institution's ability to generate an output data from existing input data. While effectiveness is the ability of institution to use the right way to get maximum results. Effectiveness and efficiency in the hospital is required because they need to provide accurate data. Each of patients has a data which must be recorded then later will be accessed continuously, especially for outpatients and referral patients. Therefore, it is considered as a big opportunity for IT providers. The significance of this research in hospital sector is to indicate that hospital is very prospective institution to apply this information system. According to BPS 2010, the total population in Jombang is 1.2 million people. Nowadays in Jombang and surrounding areas there are about 13 hospitals. LITERATURE REVIEW The Business Feasibility Study The business feasibility study is very important and become fundamental of decision-making to implement SIRS. A feasibility study is undertaken to observe whether SIRS is needed by the employee to make their work become more effective and efficient. Furthermore, whether the resources need such as human resources, hardware, materials and management systems can be provided to make the business runs well and gives positive results. If the value of cash flow earned by the business is greater than its investment value, then the project is feasible to run (Zubir, 2013). Database System (Database System Management) DBMS is one of elements in the database system. DBMS is a software that provides facilities (which are available and can be used) to perform the functions of setting, monitoring, controlling, processing, and coordinating all processes / operations which occured in the database system. (Sutabri, 2013) BPM (Bussines Process Management) According to Burlton (2012), business process is an efficient method to integrate an institution based on its pretension and necessity. BPM is a holistic management approach to improve business effectiveness and efficiency which attempts to achieve innovation, flexibility, and integration with technology. BPM tries to make continuous improvement process or refers to an ‘optimization process’. System A group of elements which closely related to each other, which have a function to achieve a particular goal simultaneously (Sutabri, 2013). Information Information as data has been processed in such a way to increase the knowledge of someone who use the data (McFadden, 2011). RESEARCH METHODS The research approach used in the development of this business is a type of applied research. Applied research according to Kuncoro (2009: 7) is a research that concerns the application of theory to solve certain problems.
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The location of the research is in PMC Hospital Jombang. The study was conducted from August 2016 to December 2016. The sampling method used in this research is Purposive Sampling which chooses informants according to objectivity and criteria. This method is attempt to obtain the data effectively and accurately in accordance with the researchers’ requirement, so that the data obtained is accurate and useful. The interviews were conducted to employees in the IT department, the owner of the PMC Jombang hospital, the financial clerk, 2 PMC hospital administrations and 2 patients at the PMC hospital. The unit of analysis used in this study is individual. Individual analysis unit is selected for feasibility analysis of IT system in hospital based on technological aspect and organizational aspect. Data collection methods in this study use primary and secondary data. Primary data is obtained by interview, observation and questionnaire (survey). Secondary data, is obtained from document or literary study. Data analysis from this research is conducted by analyzing every aspect, such as technological and organizational aspect. The data can be declared as valid if there is no difference between researchers’ report with actual condition of the object during the study. According to Yin (2009), there are four kinds of test to validate data such as internal validity, external validity, and reliability. RESULTS AND DISCUSSION The final result of this study indicate that there is a centralized integrated system to store and access the data. The system uses PHP programming base. Figure 1 represents the implementation of department details
Figure 1. Details of Department In Figure 2 we can see the implementation of transaction of mutation
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Figure 2.Transaction of Mutation
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CONCLUSION The results of research from a business feasibility study that discusses "Feasibility Study Application of Human Resource Management Information System at PMC Hospital in Jombang" conclude the following: The feasibility of information application from technological aspects in terms of facility and infrastructure readiness has been relatively adequate. The server used is already qualified. The hardwere specification used is also suitable for information system. From investment feasibility aspects can be reviewed that the company with an investment of Rp. 150.000.000 is being able to apply a paperless and appropriate support system. So that invested cost is relatively suitable between input and output. The feasibility of the system application which is reviewed from organizational aspects indicates that it is become easier to search required data and information related to the personnel system. The reporting activity of entire personnel can be processed promptly by selecting the criteria of making the report. It also helps to generate required report which corresponds with period report related to the personnel system. Furthermore, the system facilitates personnel data management including updation of each employee data and storage. In addition, it helps each head of department to make assessment of employees in such effective ways. REFERENCES Ahmadi, Hossein dan Nilashi Mehrbakhsh (2014). Organizational decision to adopt hospital information system: An empirical investigation in the case of Malaysian public hospitals. Malaysia : international journal of medical informatics 84 (2015) 166–188. Anwar, M. Khoirul dan Assianti, Oetojo S. (2004). Aplikasi Sistem Informasi Manajemen Bagi Pemerintah Daerah di Era Otonomi Daerah. Yogyakarta: Pustaka Pelajar. Burch, J. G., Grudnitski, G.; 1989; Information System Theory and Practice, 5thEdition; John Wiley & Sons, Inc. Davis, R. Bagozzi, and P. Warshaw, “Users acceptance of information technology: A comparison of two theoretical models,” Management Science, vol. 35, no. 8, pp. 9821003, 1989.
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Handiwijoyo W (2009), Sistem Informasi Manajemen Rumah Sakit. Jakarta : Jurnal EKSIS Vol. 02, No. 02, 5 Januari 2017. Ismail, Nurul Izzatty dan Abdulloh. (2014). Adoption of Hospital Information System in Malaysian Public Hospital. Malaysia : Procedia - Social and Behavioral Sciences 172 ( 2015 ) 336 – 343. Kadir, A. 2014. Pengenalan Sistem Informasi. Yogyakarta: Andi. Kodrat, David Sukardi. (2009). Manajemen Strategi: Membangun Keunggulan Bersaing Era Global di Indonesia Berbasis Kewirausahaan.Yogyakarta: Graha Ilmu. Kuncoro, M. (2009). Metode Riset untuk Bisnis dan Ekonomi. Edisi Ketiga. Jakarta: Erlangga. Laudon, C.L.; Laudon, J. P,; 2012; Management Information System Managing The Digital Firm; Prentice Hall; Upper Saddle River. McFadden, F. R.; Hoffer, J. A.; Prescott, M. B.; 1999. Modern Database Management; 5th Edition; Addision Wesley. McLeod, R. 2004. Sistem Informasi Manajemen(7th ed). Prentice-Hall Inc, New Jersey. 411 pp. Momjian, B.; 2000; PosgreSQL: Introduction and Concepts; Addison-Wesley. Nurhayati, Sri. (2009). Analisis Strategis Sistem Teknologi Informasi Dengan Pendekatan Analisis SWOT (Studi Kasus : Divisi IT Rumah Sakit Mata Cicendo Bandung). Yogyakarta : UPN ”Veteran” Yogyakarta. O’Brien, J. A.; Marakas, G. M.; 2011; Management Information System; McGraw-Hill; New York. Putra, E. (2013). Pengertian Database itu Apa? Fungsi dan Komponennya pada Database Management System (DBMS). Diambil dari http://ilmudatabase.blogspot.com (Diakses tanggal 05 Januari 2017). Rudyanto A. (2011). Pemrogaman Web Dinamis Menggunakan PHP dan MySQL. Yogyakarta: Andi. Shneiderman, “Designing the User Interface: Strategies for Effective Human – Computer Interaction (3rd edition),” Addison–Wesley Publishers, Reading, MA, 1997. Stallman, R.; 1999; The GNU Operating System and the Free Software Movement; Open Source: Voices from the Open Source Revolution; 1st Edition;O’Reilly. Diambil dari http://www.oreilly.com/opensources/book.stallman.html(Diakses tanggal 05 Januari 2017). Suliyanto. 2010. StudiKelayakan Bisnis: Pendekatan Praktis. Yogyakarta: Penerbit Andi. Sutabri, Tata, S.Kom., MM. (2005). Sistem Informasi Manajemen. Yogyakarta: Andi. Umar, Husein, 2007. Studi Kelayakan Bisnis. Edisi ketiga revisi. Jakarta: PT. Gramedia Pustaka Utama. Weske, Mathias. 2007. Business Process Management: Concept, Languages, Architectures. New York: Springer. www.bps.go.id (2016). Yin, R. K. (2009). Case Study Research Design and Methodhs, 4th edition. California: Sage Publication. Yunus, Norain Muhammad (2013), Acceptance of Total Hospital Information System (THIS). Malaysia : International Journal of Future Computer and Communication, Vol. 2, No. 3, June 2013. Zubir, Zalmi (2006), Buku Studi Kelayakan Usaha, Lembaga Penerbitan Fakultas Ekonomi Universitas Indonesia.
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FEASIBILITY STUDY OF ESTABLISHING RE:DO ARCHITECT FIRM IN SURABAYA 1
Reynaldo Febrianto Iskandar Ciputra University Surabaya INDONESIA
Email:
[email protected]
ABSTRACT Property growth in Surabaya continues to grow as the population grows where many of them are looking for homes. In addition, the development of creative industries in Surabaya also makes people more aware the needs of design and change many lifestyles of the community. It is seen from the many cafes and restaurants with thematic design. As researcher who work as freelance architect, must begin to take advantage of existing opportunities by starting an architect firm. To begin with, calculated preparation is needed to reduce and control the risks involved. Preparation is done with research on the feasibility of establishing an architect firm conducted in Surabaya. The research was done with qualitative method by analyzing five aspects, they are market aspect, legal aspect, technical and technological aspect, management aspect, and finance aspect. Research is also conducted by interviewing two interviewees who can represent the benchmark that RE:DO company wants to achieve. Market aspect analyzed using STP (segmenting, targeting, and positioning) and marketing mix. Legal aspects are analyzed by regulations that affect company. Technical and technological aspects analyze the company workflow, five dimensions of service, and technologies required. Management aspects are analyzed using five forces analysis, PEST (politic, economy, social, and technology), SWOT (strength, weakness, opportunity, and threat) and organizational structure. Last, the financial aspects were analyzed with net present value, internal rate of return, payback period, and profitability index. The results of this study indicate that the RE:DO company deserves to start and run from all the research aspect. Keywords: Feasibility Study, Establish, Company, Architect, Architectural, Service, Market, Legal, Technical and Technological, Management, Finance
INTRODUCTION Surabaya as the second largest city in Indonesia is a busy and bustling metropolis. Not only the second largest city alone, Surabaya is also a city with the second largest business development in Indonesia. Surabaya is located on the north coast of East Java which is strategic location geographically and make Surabaya a gateway to eastern Indonesia. This strategic location made Surabaya since 413 AD, became an international trading port city. Until now, Surabaya remains a busy city. Many people from other regions are moving to Surabaya to work so that population growth in Surabaya is increasing. Recorded until the end of
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November, the growth of Surabaya residents as many as 30,675 people who moved to Surabaya and 28,289 babies born in Surabaya. This makes people who move and live in Surabaya vary ethnically. Ethnic in Surabaya there are Malays, Chinese, Nusantara, Arab, India, East Asia, Europe, etc. However, racial, ethnic and religious conflicts occur very little. This makes Surabaya a dynamic and plural city. With the rapid growth of the population and the relatively stable city, many people decided to live in Surabaya. This certainly makes them have to find a place to live. This is evidenced by the rapid property growth in Surabaya which is indicated by the increasing property prices. Recorded, property prices in Surabaya in the early trimester of 2013 increased by 12% compared to 2012. In addition, in 2013, construction sector growth reached 9.11% based on data from the Central Bureau of Statistics. Based on data from urbanindo.com, the most sought property in Surabaya is home. This is because the mindset of the people of Surabaya who prefer a house rather than an apartment. The development of existing property is influenced by the rapid economic growth in Surabaya. In fact, data from Jawa Pos stated that the projected economic growth in East Java reached 5.61% in 2016. Surabaya as an international trading city of colonial and plural cities, makes Surabaya rich in art and culture, one of which is architecture. The architectural style is very diverse, there are art deco, indische, Chinese, eclectic, etc. Growth of art in Surabaya can also be felt up to now. The creative industry is very developed, ranging from culinary, fashion, crafts, furniture, to architecture and interior. Recorded, the creative industry contributes 7% of Surabaya Gross Regional Domestic Product or about Rp. 12.3 trillion. Many new cafes and restaurants whose buildings and interiors are designed with concept. Not only that, many people now do not want their house as boring as before, they have started thinking of comfort and aesthetics. These things make researcher1 who now work as freelance architects, should be able to capture the opportunities that exist. Researcher1 have five years of architectural work and have enough experience, it is time to start the company's own architect. Previously, researcher1 have done many home projects, housing, hotels, and interiors. This study aims for researcher1 to have calculated preparation in starting an architect firm, so the risks that will occur can be reduced and controlled. LITERATURE REVIEW Previous Research The first study was Abou-Moghli and Al-Abdallah's "Market Analysis and the Feasibility of Establish Small Business" in 2012. The purpose of this study was to examine the relationship and effects between market analysis and feasibility in the opening of small business in the service sector in Jordan. This research is done by using descriptive method with four reference variables, namely location, demand, price, and competitor. The population study consisted of 163 cases and the researchers used 42 questions with close ended questionnaire, with realibility coefficient of 83.43%. Then, the analysis is done with simple regression analysis and stepwise multiple analysis. The results show statistically closely the relationship between location, demand, price, and competitors with the feasibility of opening a small business. The second study was "Feasibility Study of E-Insurance in Iranian Insurance Company (Asia Insurance Co.)" conducted by Alipour, Dorodi and Pishgahi in 2011. This study aims to study the feasibility of electronic insurance services in Asian insurance companies. This study uses the methods and theories conducted by other insurance companies. This study uses the TELOS model where there are technical, economic, legal, operational, and seasonal aspects. Data were obtained through 27 questions on a questionnaire survey at Iran Insurance Company (Asia Insurance Company). The conclusion of this research information is done with descriptive and inferential statistics. The results of this study indicate that the economic factor becomes the most important, then operational, legal, and then seasonal factors. The conclusion of this study
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recommends Asian insurance companies to work with electronic insurance services within their departments. The third study is "Carwash Mobile Feasibility Analysis in Bandung" conducted by Blue, Fitria, and Bakar in 2014. The purpose of this research is to evaluate the feasibility of mobile carwash business in Bandung. The research method used is literature study, data collection, and data processing. Analyzes were conducted on market, technical, legal, human resource management, and financial aspects. Data collection was done by interview with the manager of car washer company competitors in the area of Bandung, East Java. The results of this study explain the relation of market, technical, legal, human resource management, and finance aspects to the plan of opening carwash mobile business in Bandung. The conclusion of this research is that this effort is feasible to run. The fourth research is "Business Development Feasibility Study at PT Dagang Jaya Jakarta" conducted by Nurjanah in 2013. The purpose of this research is to know the feasibility of business development conducted by PT Dagang Jaya. This research method uses analysis based on the aspects of business feasibility study, namely financial, market and marketing aspects, management and human resources, legal, technical and operational, environmental, and economic and social. The results of the analysis of each aspect show a positive result which states that the development of this business is feasible to run with one way is to increase the number and variety of products distributed by the company. The fifth study was "Feasibility Study of Cigarette Factory Establishment in Bojonegoro, East Java" conducted by Saputra, Surjani, and Soegiharto in 2013. The purpose of this research is to evaluate the feasibility of establishing a tobacco factory in Bojonegoro. The research method is done by five steps, namely initial observation, problem identification, determining research objectives, conducting library study, data collection, data processing and analysis, and finally draw conclusions and suggestions. The data collected in the form of primary data and secondary data. Primary data was collected from direct observation from the source by interviewing and sharing questionnaires to 150 smoker respondents in Bojonegoro. The results of this study explain the relationship between the plant establishment plan with the aspects of market, technical, management, and finance. The results of the sensitivity analysis, the most sensitive variables are selling price, selling rate, and labor cost. The conclusion of this research is that this business has a very good prospect to run. Architectural Service Service is any action or for work offered by one party to another that is intangible in principle and does not cause any transfer of ownership (Philip Kotler, 1997). Its production may be related and may not be related to a physical product (Murti Sumarni, 2002:17). Architectural service is simply designing a good architecture and in accordance with the needs of clients. While, the purpose of architecture is (1) Controlling the physical from external factors, such as: climate, disaster, crime, noise, etc.; (2) Facilitate and as a forum for the whole set of activities that require space and are expressed in a certain pattern of behavior; (3) Social milieu, which is the building duty in relation to social functions; (4) As a cultural symbol, a tool for communicating values (Norberg-Schulz, 1963). The function of using the services of architects according to the Association of Indonesian Architects are (1) Architects are trained to receive explanations from clients and can see the whole concept. They are aware of the important needs for designing flexible buildings that can adapt to changing needs of the inhabitants; (2) Architects can save clients money by maximizing investment from clients. A well-designed building can reduce current costs and increase its value over the long term. (3) Architects can save time by organizing and coordinating key elements in the project. (4) Architects can help their client's business. They
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create an overall built environment, interior and exterior, comfortable and functional for the users and occupants of the environment. Feasibility Study A feasibility study is an activity that studies in depth about an activity or business to be run, to determine whether or not a business is viable (Kasmir and Jakfar, 2012). Running a new business as well as developing a business will have the possibility of failure to meet company goals. To avoid the possibility of failure before establishing or developing a business, it is necessary to study the business (Kasmir and Jakfar, 2012:6). The business feasibility study not only analyzes feasible or unfeasible business built, but also when operationalized on a regular basis in order to achieve maximum profit for an unspecified time (Umar, 2005). Market Aspect Market aspect analyzed with STP theory and marketing mix. STP contains segmenting, targeting, and positioning. Segmenting is a heterogeneous market-sorting activity into homogeneous market units. Segmenting sees available markets for the company's industry, then divides them based on variables that will be adjusted to the company's target. Targeting is the activity of assessing and selecting one or more market segments to be entered by a company. Positioning is designing supply and corporate image to occupy a position of competition and position in society. Marketing mix contains 4P, that is product, price, place, and promotion. Products are goods or services to be produced or sold (Philip Kotler, 2010). Price is the quantity of payment or compensation given by one party to another in return for goods or services (Robert M. Schindler, 2012). Place is the location for the company to sell its products. Promotion is the way companies can communicate their products, with the purpose of giving a positive influence on consumer decisions. Legal Aspect Legal aspects analyze the legality needed to run a business. Legal provisions may vary according to the area of business or business location is run. The existence of regional autonomy causes the provision of law and licensing between one region with another different region (Suliyanto, 2010:15). For architect firm, which need to be studied are business license (SIUP), Indonesian Architect Association (IAI) regulations, Surabaya city government regulations, building management permits (IMB), and tax obligations. The business license takes care of the need to open a legal entity. Indonesian Architects Association takes care of the need for profession of architect. The Surabaya city government regulation governs urban planning and technical requirements in designing buildings. Building management permit describes the required picture requirements for building a building. Tax obligations regulate individuals or legal entities to pay contributions to government. Technical and Technological Aspect Technical aspect analysis is all matters pertaining to the technical business development process and its operation after the project is completed. In this aspect it examines the company's workflow, the five dimensions of service, and the technology required for the operation of the company. The workflow discusses how firms operate efficiently and systematically. Five dimensions of service is a multidimensional research instrument (i.e. questionnaire or measurement scale) designed to measure service quality by capturing respondents' expectations and perceptions along the five dimensions of service quality (A. Parasuraman, L.L. Berry and V.A. Zeithaml, 1996). Five dimensions of service contain: (1) Reliability, the ability to perform the promised service dependably and accurately; (2) Assurance, the knowledge and courtesy of
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employees and their ability to convey trust and confidence; (3) Tangibles, the appearance of physical facilities, equipment, personnel and communication materials; (4) Empathy the provision of caring, individualized attention to customers, (5) Responsiveness, the willingness to help customers and to provide prompt service. Technology discusses hardware and software that will be needed in the company's operations. Management Aspect In this aspect there are five forces analysis, PEST, SWOT, and organizational structures. Five forces analysis discusses the five forces that affect industry and business strategy, namely: (1) Threat of New Entrants; (2) Bargaining power of buyers; (3) Bargaining power of suppliers; (4) Threat of substitute products or services; (5) Rivalry among existing competitors (Michael Porter, 2008). PEST describes the macro environment that can affect the company's micro environment, namely: political, economic, social, and technology. SWOT is an effective and efficient way to observe the internal and external environment of the company (Philip Kotler, 2011: 51). Internal environment in question is the strength and weakness of the company, while the external environment is an opportunity and threat from outside that affect the company. The organizational structure addresses the arrangement, hierarchy, and allocation of human resources so that the company can run effectively, efficiently and flexibly. Financial Aspect Financial analysis is an activity of assessing and determining the units of rupiah against the aspects deemed worth making in the business analysis phase (Sofyan, 2003). This aspect will calculate NPV (Net Present Value), IRR (internal rate of Return), PP (Payback Period), and PI (Profitability Index). Net present value is a method that calculates the difference between the current investment value and the value of net cash receipts in the future. IRR is the interest rate that keeps the cash outflow the same, or the interest rate that makes or causes the NPV equal to zero. Payback period can be obtained by calculating the number of years required for the amount of cash flow equal to the initial investment value. According to the profitability index method, a business can be calculated by dividing the present value of cash in flow with present value cash out flow from the business. RESEARCH METHODS Research approach used is applied research, survey approach, descriptive explanation level, and type of qualitative data. Time of study is conducted within 4 months between January 2017 April 2017 or during this thesis research. The research was conducted to the property industry practitioners who use the services of architecture and society of Surabaya with the method of interview and direct observation. This research use interview method and sampling method used is purposive sampling. This technique is a non-probability technique in which the units are examined based on the assessment of the researchers. The purpose of using this method is for research to really focus on the company. The data in this research are qualitative data obtained from several sources. Primary data in the form of interviews, market observation, survey, and projection of internal data of the company. Secondary data is literature study. Market aspect analyzed with STP and marketing mix. The legal aspect analyzed all the permits required for the establishment of architect firm in Surabaya. Technical and technological aspects are analyzed with workflows, five dimensions of service, and required technology. Management aspects are analyzed with five forces analysis, PEST, SWOT, and organizational structure. Financial aspects were analyzed with NPV, IRR, PP, and PI. RESULTS AND DISCUSSIONS
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Market Aspect The following are STP results from the company RE:DO. Segmenting is divided by: (1) Economy class: low, middle, and high; (2) Project scale: small, medium, and large; (3) Ownership: individuals, corporations, and governments; (3) Architectural style: classical, ethnic, modern tropical, industrial, and contemporary; (4) Project function: residential, office, retail, food and beverage, exhibition, hotel, apartment, shopping center, religion, school, entertainment, industry. From the existing segment, the company sets targets, as follows: residential with modern tropical dan contemporary architectural style; and office, retail, food and beverage, exhibition, religion, school, entertainment projects with contemporary architectural style. The positioning to be achieved by the company is a company that produces a luxury design that shows individuality of design for people who have architectural design needs that are more specific than the average person. The company also has a tagline that represents the company's positioning desire, which is "How much you yearn for your sanctuary?" The tagline describes how the client wants to be the most important place to him, how designing should be for the place that is most important to him. The following are the marketing mix results from the company RE:DO. Products and services are architectural design ideas and interior design through architectural shopdrawings and 3D images, and coordination services between architects, clients, and all parties in the project (contractor, mechanical, electrical, plumbing, structural expert, interior). The price for the design is a relative thing because the judged is the idea. The offered price is Rp. 500.000,-/m2 for building area. Price is calculated based on operational cost and profit to be taken. From the interviews and observations, the location is not the main thing for the architect firm, but only for the company's bonafide. Office design should be able to reflect the architect firm. Then, in the IAI code of ethics, architects can not be promoted with advertising, then the effective way of promotion is with digital media (website and instagram), business cards, and words of mouth. Legal Aspect To start a company, need a Business License (SIUP). To make SIUP need to follow some requirements and collect some documents. And, for the architect firm required IAI certification and become its members. Certificate of expertise from IAI has three stages, namely: (1) Arsitek Pratama, first level; (2) Arsitek Madya, second level; (3) Arsitek Uttama, the highest level. The Arsitek Pratama has the most restrictions on handling projects to the Arsitek Utama who can handle any type of project. In operation, it is necessary to follow the applicable local rules. Architects must follow the Urban Spatial Detail Plan (RDTRK), where they are set zoning zones according to urban development plans. Then, there are some border lines that governs the planning of a project. Border lines are set: (1) Fence Border Line (GSP), set the distance between road and fence; (2) Building Border Line (GSB), set the distance between buildings with limits of lots or streets. Then, there are rules governing the appropriation of a project. Zoning regulations consist of: (1) Building Ground Floor Coefficient (KDB), is the ratio of the entire ground floor area of the building to the land area; (2) Building Floor Area Coefficient (KLB), is the ratio of the entire floor area of the building to the land area; (3) Green Coefficient (KDH), the ratio of the entire open space area outside the building, intended for plantation, to the land area; (4) Basement Site Coeffisient (KTB), is the ratio of the basement site to the land area; (5) The maximum height of high rise buildings; (6) Number of floors of basement; (7) Specific provisions applicable to the location concerned, eg. distance to the electric tower; (8) Amount of vehicle parking. Then, there are building technical requirements that govern the safety and sustainability of the building. It is regulate the strength of building structures and building utility systems from mechanical, electrical and plumbing, fire and evacuation systems. In addition, amenities and circulation are also governed by heating, ventilation, and air conditioning (HVAC), human
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horizontal ciruluation, vertical circulation (ladder, elevator, elevator), and vehicle circulation. Then, the architect must create a drawing for the IMB where there are drawing requirements to be collected. In addition, there is a taxpayer regulation for the company. The tax liability to be borne by the company is personal income tax (PPH 21), income tax on delivery of services (PPh 23), and corporate income tax (PPB). Technical and Technological Aspects The first thing that needs to be analyzed is the workflow of the company. Company operations start from consultation / tender and site survey to get data from client and site. After that, the brainstorming company goes into the design process until it prints the image for presentation to the client. After that, the client provides feedback for the revised design. Once approved by the client, then start shopdrawing for construction and coordination of the team on site until the project is completed. Because the company is engaged in services, it is necessary to analyze five dimensions of service. (1) Reliability: the ability to perform tasks as promised by making SOPs and attending all required meetings of the project. (2) Responsiveness: speed of service by making the time table given to the client. (3) Assurance: invites teams to participate in site surveys, attending meetings, and undertaking studies on the updated and realistic-learning architecture. (4) Empathy: rules to always speak good, proper, and polite Indonesian. The company will also provide rendering of framed rendering images and routinely inquire about the convenience and state of the building to the client as a form of concern. (5) Tangible: office building will be designed with creative. Everyday attire is semi casual sleeves, trousers, and shoes; While attire for meetings are office clothes, trousers, and shoes. The technology used is divided into hardware and software. Hardware required is three computers, an A3 printer, a fingerprint device, CCTV, an HDTV, and offline network system. Software needed is AutoCAD, SketchUp, 3D Max (or equivalent rendering program), photoshop, MS Word, MS Excel, MS Power Point. Aspek Manajemen To find the right management system, it is necessary to analyze internal and external factors of the company. The first is the five forces analysis. Data obtained from a questionnaire filled by two resource persons who work as an architect, then the number of values averaged. Indicators of the threat of new entrants are services, products / services, service prices, capital requirements, and government policies. An indicator of the bargaining power of a buyer is the purchasing power of the buyer, other product information, the cost of switching to another service, the buyer's choice. Indicators of the bargaining power of suppliers are the number of suppliers, the interests of the supplier's products, the differentiation of the supplier's products, the supplier's information. Indicator of replacement product's bargaining power is a replacement product, replacement product quality, replacement product price, replacement product market share. Indicators of the competitor's product bargaining power are the number of competing products differentiated, industry growth, fixed costs, resignation inhibits. Here's a graph of five forces analysis:
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Figure 1. Graph of Five Force Analysis results Source: processed data (2017) Next is PEST analysis. (1) Politics in Indonesia is relatively stable and the government led by Joko Widodo gives positive potential for business. (2) The economy is certainly influential. Increased economic growth will make purchasing power increase as well. (3) Social. With the growing population, the demand for shelter will also increase. (4) Technolgy will certainly facilitate the operational and educational public about architecture. Next is SWOT analysis. (1) Strength: The company has a good portfolio, has a strong network, has a strong differentiation. (2) Weakness: still do not have a clear system, still tend to one man show, still not formed organizational structure, capital is still weak. (3) Opportunity: more and more cafes and new restaurants are located, property in Surabaya that tend to stable and still able to rise again, awareness of the design community will increase along with the progress of technology and information, Surabaya society pattern mostly still to reside at home Rather than apartments, the central government's program in infrastructure mega-projects will provoke economic and property growth. (4) Threat: Asian Economic Community (MEA) makes architects in Indonesia have to compete with the market with architects from abroad, many upper-class people in Surabaya are more confident to choose the architect from Jakarta, the price of expensive architectural books and lack of interest in reading Surabaya society slow down the progress of architecture in Surabaya, there are still many people in Surabaya who have not dared to take home design differentiation from home mostly. Of the SWOT indicators, then the sources fill out the questionnaire and then the sum of the values averaged to produce Graph 1.2 which is recommend to use aggressive strategy. Here is the ideal organizational structure for the company RE:DO:
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Figure 2. Graph of Five Force Analysis results Source: Processed data (2017)
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Figure 3. Organizational Structure RE: DO Architect Consultant Studio at the developing stage Source: Observation Financial Aspect In financial terms, records are made. To be analyzed with NPV, IRR, PP, and PI. NPV optimistically generates Rp 672,272,242, - where the value is greater than 1.
Then, IRR optimally produces IRR of 24,10% which results is bigger than corporate credit rate. 1,500,000 NPV 1,300,000 1,100,000 900,000 700,000 500,000 300,000 100,000 -100,000 -300,000 0 2.5 -500,000 -700,000 -900,000 -1,100,000 -1,300,000 -1,500,000
IRR calculated using the formula Discount rate 5
7.5
10 12.5 15 17.5 20 22.5 25 27.5 30
True IRR
Figure 1.4 Graph of Five Force Analysis results Source: Processed data (2017) Then, the PP on the optimistic calculation projected the investment will return within 3 years 10 months 18 days.
PI for optimism, in the fifth year the number is 1.79 where this number is greater than 1. Table 1. Profitability Index (optimism) Treasury Investation PI Year 0 0 0,00 Year I 309.680.000 0,21 Year II 696.888.000 0,46 1.503.200.000 Year III 1.198.260.800 0,80 Year IV 1.862.038.080 1,24 Year V 2.694.040.448 1,79 Source: Processed data (2017) From the results of the calculations it shows the RE:DO business is feasible to start and run. CONCLUSION
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After analyzing these five aspects, it can be concluded that the business plan of RE:DO is feasible to be opened and run. REFERENCES Badan Pusat Statistik (2014). Pertumbuhan Jumlah Penduduk Indonesia. Accessed 1 April 2017, dari www.bps.go.id UrbanIndo (2013). Analisa Properti di daerah Surabaya, Jawa Timur. Accessed 1 April 2017, dari www.urbanindo.com Norberg-Schulz, Christian (1963). Intentions in Architecture. Oslo: Universitetsforlaget. Kotler, P., G. Armstrong. (2012) Principles of Marketing, 13th edn, Pearson International Education. New Jersey, USA: Pearson Prentice Hall Porter, Michael. (2012). The Esessential Guide to Competition and Strategy. USA: Harvard Business Review. Sofyan, I. (2003). Studi Kelayakan Bisnis. First Edition. Yogyakarta: Graha Ilmu. Parasuraman, A.; Zeithaml V.A.; and Berry, L.L. (1996). The Journal of Marketing, 31-46. American Marketing Association Sumarni, Murti (2002). Manajemen Pemasaran Bank. Yogyakarta: Liberti
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MARKET SEGMENTATION ANALYSIS WITH CLUSTER ANALYSIS APPROACH OF CUCI HOUSE LAUNDRY 1
Kadek Ayu Windasari
Ciputra University Surabaya INDONESIA Email:
[email protected] ABSTRACT Market segmentation is a process of simplification from heterogeneous group to homogeneous group. Setting the right market segment helps the company to understand its customers' needs. Since the laundry business in Bali has rapidly increased, companies need to know the market segment in order to position their product. With market segmentation, companies can open new branch that fits the needs of customers in that location and suits their characteristics. The purpose of this study was to classify customers on Cuci House Laundry in Denpasar based on demographic and behavior approaches. Samples from this study were customers of Cuci House Laundry age 16 to 49 years old who stayed in the South and East Denpasar, selected by applying purposive sampling technique. Data were collected by distributing questionnaires to 100 samples using cluster analysis approach with K-means method. The findings show three clusters formed, namely segment 1 Price Sensitivity Customer, segment 2 Customer Value, and segment 3 Quality Customer, where there are differences in variables of benefits and attitudes in each cluster. Keywords: Market Segmentation, Cluster Analysis, Laundry
INTRODUCTION The higher the increased number of service customers, the greater the market share of a service business. This also applies to laundry service business. In Denpasar, numerous laundry businesses are competing with each other to develop their business and provide the best service for their customers. Denpasar is a city with very high mobility rate, where its population consists of students and newcomers in big numbers, preoccupied with their works and daily activities, hence disallowing them to do their own chores. This situation is considered as opportunity for laundry service business to rapidly develop, and thus has made the entrepreneurs aware that laundry service is a very promising business to run. Cuci House Laundry is one of the laundry companies determined to “Make Your Life Better” feels obligated to be more creative to compete in this tight business competition. Cuci House provides laundry service for both individuals and companies. Therefore, this company, founded by Kadek Ayu Windasari on July 10, 2013, has interesting offers in form of laundry and ironing services for two different segments, namely private laundry per kilo and premium laundry with competitive price and quality. Cuci House Laundry provides 2-hour laundry service and only uses one machine for each customer. Previously, the owner of Cuci House Laundry had yet conducted market segment analysis due to the lack of human resource responsible for measuring service quality. There was a specific hotline number for customer care, yet the customers had not used this facility properly and no critic or suggestion ever received through this hotline number. However, there were complaints on the service quality directly received by the
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company from June to August 2016. On the premium service segment, eight customers complained about the service and five customers complained about the color after washing quality, while on the private service segment, seven customers complained about the increased price from Rp. 7.000 per kg to Rp. 8.000 per kg. Recognizing the importance of knowing the customer satisfaction of service in the sustainability of this business, an interesting business plan must be made to make more customers choose and use the business, and therefore to increase customers’ satisfaction. Customer satisfaction depends on the customer's assessment of the services provided, so it is necessary to have awareness on the quality of service that has been and will be given, and the customer expectations of the facilities provided. In today’s fierce market competition, using a marketing strategy without differentiation from competitors blurs the company market segment. Jonathan (2007) supports this situation by saying that 95% of new launched products failed because their company could not read the market and thus had weak positioning. Failures in reading the market, such as mapping the segment and establishing the market target, can cause the implementation of marketing technique to fail. Based on the above explanation, the researcher conducted this research with the following title “Market Segmentation Analysis with Cluster Analysis Approach of Cuci House Laundry” Review of Related Researches Roy and Jushermi (2014) conduct a research entitled “Analysis on the Effect of Lifestyle Segmentation on the Customers’ Use of Service and Satisfaction at the Simply Fresh Laundry Service in Pekanbaru” with aim to determine the effect of lifestyle dimensions, namely activities, interest and opinions, on customers’ use of service and satisfaction at the Simply Fresh Laundry in Pekanbaru. The variables are lifestyle segmentation and decision to use service and satisfaction. Non-probability sampling is used to select 150 customers as samples, while the data are gathered through questionnaires and later be analyzed using AMOS 22 structural equation model. The findings show that two structural equations are generated, where variable of opinion has the most dominant influence on the customers’ decision to use service from Simply Fresh Laundry, while activity has the most dominant influence on the customers’ satisfaction for this business service. Thus, in general it is concluded that decision to use the service holds very important role in influencing customers’ satisfaction when using the service from Simply Fresh Laundry, while opinion has dominant influence on the decision to use the laundry service. Other research conducted by Noviani (2012) entitled “Analysis on the Effect of Price and Service Quality on the Costumers’ Satisfaction at Kita Jaya Laundry”. This research aims to determine the effect of price and service quality on the customer satisfaction at Kita Jaya Laundry. The variables studied are price, service quality and customer satisfaction. This research uses simple regression analysis and multiple regression with random sampling technique by distributing questionnaires to 100 samples. The findings show that price and service quality have effect on customer satisfaction. Employee’s low performance can be improved by encouraging creative and innovative behavior variables. The research then concludes that price and service quality have simultaneous and significant effect on consumer satisfaction, thus price and service quality are both factors that have equal effect in increasing consumer satisfaction. RESEARCH METHODS The population in this research was the customers of Cuci House Laundry with the total number of 1.750 customers. The researcher then set the following criteria for determining sample: (1) had to be between 16 to 49 years old, and; (2) had to be a customer of Cuci House Laundry Bali, either the customer for per kilogram segment or premium segment.
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This research is quantitative in nature, since the data used in this research were in form of quantitative data, or qualitative data which were later converted into numbers (Sugiyono, 2012:3). The primary data were taken from the respondents through questionnaires and interview with samples as respondents. The secondary data were taken from Cuci House Laundry’s internal data, year 2016. Method used in this research was a prior segmentation, since the number of segments was already set before the data analysis was begun. In addition to that, the researcher already knows what target to be achieved through this research since this company has been into business for four years. The researcher measured the data by using Likert scale. The method of measurement was by asking the respondents to answer questions with “totally agree”, “agree”, “neutral”, “disagree”, and “totally disagree”. All answers were then converted into 1 for “totally disagree” to 5 for “totally agree”. Demographic factor and usage rate variable on the behavior variable are categorical attributes in this research. The respondents were asked to give information related to their age, work, income, education, and usage rate. The data analysis process in this study used non-hierarchical method or k-means clustering method to group the research object based on the formed variables, and cross tab analysis or cross tabulation analysis to profile the object in each cluster. Unlike the hierarchical approach that combines object-by-object which has similar characteristics that establish a hierarchy, k-means clustering method processes all the indicators used in segmenting or clustering all at once, where the process begins by determining the number of desired clusters (Rangkuti, 2011:113). This method was used due to its high efficiency level and its ability to describe the characteristics of each segment compared to hierarchical method. However, to be able to use non-hierarchical method, the researcher is expected to already know the number of desired cluster to form. In this study, the researcher set three fixed clusters where the clusters were determined based on the researcher’s need by referring to a priori segmentation method. The clusters would be formed by subjective considerations in accordance with the purposes of research, where these three-fixed clusters allowed the researcher to categorize all segments based on the quality level: high, medium, and low. Results The three fixed clusters were used to structure the analysis, where the crosstab analysis was conducted later (see Appendix 5) in order to profile the respondents based on the formed clusters. Table 1 shows the characteristics of each cluster based on categorical data. Table 1. Characteristics of Cluster Variable Category cluster 1 cluster 2 cluster 3 N = 59 N = 10 N = 31 Age 16-25 Years 22.0% 20.0% 25.8% 26-35 Years 45.8% 20.0% 32.3% 36-45 Years 27.1% 50.0% 38.7% > 45 Years 5.1% 10.0% 3.2% Work Student .0% .0% 6.5% College student 5.1% 20.0% .0% Government employees 23.7% 10.0% 9.7% Private employees 42.4% 30.0% 51.6% entrepreneur 27.1% 40.0% 29.0% Etc. 1.7% .0% 3.2% Education SD 1.7% .0% 3.2% SMP .0% 10.0% 3.2% SMA 20.3% 60.0% 38.7%
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Income
Intensity of laundry per week Intensity of replacing vendor
Diploma Bachelor
Rp.2.000.000 1-2 times a week 3-4 times a week > 5 times a week 1-2 times a year 3-4 times a year > 5 times a year
28.8% 49.2% 1.7% 8.5% 18.6% 71.2% 39.0% 27.1% 33.9% 78.0% 18.6% 3.4%
.0% 30.0% .0% 20.0% 50.0% 30.0% 40.0% 40.0% 20.0% 70.0% 30.0% .0%
32.3% 22.6% 6.5% 16.1% 22.6% 54.8% 45.2% 38.7% 16.1% 87.1% 12.9% .0%
The results of demographic and behavioral analysis reveal the form of three fixed clusters. The researcher then consulted the results with experts to discuss the suitable and representative names for each formed cluster: Cluster 1: Value Customer Of all three fixed clusters, Cluster 1 has the highest number of respondents which is 59% of the samples (59 respondents). This cluster dominates all the variables, i.e. benefit sought variable and consumer attitude variable. This indicates that all respondents in this cluster were perfectionist and had high expectations of the laundry services they used, including the economical, ergonomic and aesthetic aspects. They expected laundry service they chose provides satisfactory service such as perfumed and spotless laundry, perfect pressing and neat fold, attractive and practical packaging, provides pick and delivery service, washing repeated warranty for laundry with unsatisfactory results, and competitive price. Characteristics of respondents in cluster 1 were respondents with age between 26 to 35 years old and most of them had bachelor degree. They worked as civil servant with monthly income above Rp. 2.000.000. All respondents were active laundry service customers with laundry frequency five times a week. Most respondents also changed their laundry vendor five times in a year. They chose laundry service to do their laundry since they were busy with their activities and had children who needed fresh clothes almost all the time. Cluster 2: Price Sensitive Customer Cluster 2 consists of 10% of the samples (10 respondents); hence, the smallest cluster of all. This cluster supports past research (Luthfianto, 2014; Rizani & Satria, 2013) on the price factor as one of the important factors considered by the customers when deciding to use laundry service. The cluster analysis result showed this cluster had low economic and ergonomic values. This suggests that this cluster has a high sensitivity to service price, or in other words, price can have larger portion than other factors in influencing the customers to choose and use laundry service. Respondents in this cluster were those between 36 to 45 years old with high school diploma. Most of them worked as small medium enterprise entrepreneurs with income ranged between Rp 1,000,000 to Rp 2,000,000. Most of them were average users with intensity of laundry service around three to four times a week and changed vendor three to four times a year. They desired quality service with affordable service. However, they were unlikely to have an attachment to a particular vendor, so it would be difficult for them to recommend a laundry service to their colleagues or relatives. Cluster 3: Quality Customer
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Cluster 3 is the second highest cluster with 31% of the samples (31 respondents). This cluster shares almost similar characteristics with cluster 1. However, the respondents in cluster 3 were not too perfectionist and did not have too high expectations of the laundry services, as shown by the score of mean benefit sought and their responses which were neutral to positive. Still it does not mean that they did not pay attention at all to the laundry service quality. The customers in this cluster were college students and young executives between 16 to 25 years old with diploma degree. They cared for their physical appearance and preferred suitable laundry service for their shoes, dress and suits. Most of them worked as employees of private companies with income above Rp. 2.000.000. Compared to the respondents in cluster 1, they seldom used laundry service with intensity of laundry once or twice a week, and changed laundry vendor once or twice a year. They also would not mind to pay more for their laundry, as long as its service meets aesthetic criteria such as perfumed laundry, clean, and neat. All respondents in cluster 3 were the laundry service users with medium to high intensity, thus having medium possibility in doing laundry service compared to the respondents in cluster 2. Conclusion By referring to the discussions, it is concluded that clustering the market segment can be done through K-Means method. In this research, the clustering was done based on demographic data and attitude variables, resulting three fixed clusters namely cluster 1 Value Customer as the highest number of respondents (59 respondents), cluster 3 Quality Customer as the second highest or middle cluster with 31 respondents, and cluster 3 Price Sensitive Customer as the smallest cluster with 10 respondents. At glance, there was no difference of characteristics between cluster 1 and 3, yet the researcher found out that the customers in cluster 1 tended to care about their laundry vendor. For example, when they felt dissatisfied with the service provided, they complained about it to their vendor and did not change the vendor, since this cluster still needed quality service with affordable price. While for the customers in cluster 3, they did not hesitate to change their vendor since they were willing to pay for perfect service. Thus, it is very possible for the laundry services to set high price if they are able to provide excellent service (premium service for premium segment). REFERENCE Larsen, N. (2010). “Market Segmentation”. Aarhus School of Business. Noviani (2012). “Analisis Pengaruh Harga Dan Kualitas Pelayanan Terhadap Kepuasan Konsumen Pada Kita Jaya Laundry”. Roy, J (2014). “Analisis Pengaruh Segmentasi Gaya Hidup Terhadap Keputusan Penggunaan Dan Kepuasan Konsumen Jasa Simply Fresh Laundry Di Kota Pekanbaru”. Rangkuti, F. (2011). “Dongkrak Penjualan Melalui Marketing Strategy & Competitive Positioning: Mengukur Segmentasi, Targeting, dan Positioning Menggunakan SPSS. Jakarta: PT. Gramedia Pustaka Utama”.
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FORMULATION OF GOOD FAMILY BUSINESS GOVERNANCE FOR COMPANY SUSTAINABILITY (CASE STUDY ON CV K) Khusnul Qotimah, 2Tina Melinda♠
1
Ciputra University Surabaya INDONESIA Email: 1 [email protected] , 2 [email protected] ABSTRACT This study aimed to formulate good family business governance in CV. K. The governance elements studied in this research included accountability, transparency, fairness, participatory, and consensus oriented. Three tools were used to formulate good family business governance for CV. K., namely family constitution, family meeting, and family council. This research is qualitative in nature with triangulation method. Data were collected through interview with three groups of informants: expert, first generation, and second generation and the total number of informants was four informants. The research show that five elements of governance have not been fully applied to the CV. K, many things need improvement in supporting the implementation of five elements of governance at CV. K., and tools applied to the CV. K were family meeting and family constitution. Keywords: Family Business, Governance, Family Constitution, Family Meeting
INTRODUCTION Family company is an interesting phenomenon in business world. Many companies around the world are family company and have big contribution to their country. In Indonesia, of 95% or 159,000 out of 165,000 existing companies are family companies (CNN Indonesia, December 02, 2014). Since a family company is a company owned and controlled by particular family, family’s vision, mission and issues heavily influence the management and performance of either small or big company. Three main issues often arise in the family business are family issue, ownership issue, and business issue, and can be found both in the first generation or the next generation. Those issues are actually similar with issues found in non-family business companies. To address these issues, a family company must have good management system or good family business governance in order to be able to provide effective protection to all family members, including those who are not active in the business themselves. That is also to make sure that the business can fulfill the family and company interests. CV. KS is a company owned and managed by the researcher’s parent, MT, and has been operating for more than nineteen years. The company manufactures plastic packaging for industries (factories and end users). Currently, the first and second generation manage this company. During management process, conflicts happened due to buck-passing. The owner’s unprofessional attitudes also cause insignificant business development. If the conflict continues and good family business governance is not implemented immediately, it is worried that this family business will not survive anymore. Family’s internal conflict has negative impact towards its members’ emotional health and thus towards the company performance. Therefore,
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a good governance is highly needed by the company. The implementation of good corporate governance can help maintaining good relationship among the company stakeholders, as well as increasing the company profit and maintaining good performance. LITERATURE RIVIEW Review of Related Researches Research conducted by Botero, et al., (2015) entitled “Family Protocols as Governance Tools, Understanding Why and How Family Protocols are Important in Family Firms” aims to find out how family protocol as a tool of policy in corporate governance can help solving intra family conflicts and increasing the probability of family business sustainability. This research uses the theory of equity and organizational justice as theoretical framework and explains why protocol development can help family company to survive. This research’s contribution is as reference to integrate the practitioners and academics’ works to understand family protocols, describe how and why protocols help family and business relationship, and present a procedural model for family protocols development to manage relationships between family and business. Family Business Governance Aronoff (2011:2) explains that many family businesses are unknowingly doing business without clear pattern, thus worsening communication and decision making process and later destroying the company’s common good. Family business governance is an effective governance system to empower leadership in both family and business in order to family business’ unique strengths: a strong synergy, unity in family business ownership, and good family company management. Aronoff (2011:8) describes family company governance in three circles based on its three main components: family, owners or ownerships, and management of family company. Elements of Governance One of the values in running or maintaining family governance that cannot always be visible to all members but in fact is one of the most important, is that a value of opportunity for the family to appreciate their working togetherness experience in order to achieve family target and desire (Aronoff & Ward, 2011:12). Key elements of this value are accountability, transparency, fairness, participatory, and consensus oriented or consensus building. Khan (2014:12) refers accountability to necessity and responsibility in providing explanation or reason for all company activities and decisions taken by the company. This kind of transparency also demonstrates company’s ability to provide information about company activities or financial performance, including future planning and challenges faced when running a business strategy to all company stakeholders. Aronoff and Ward (2011:6) add that in building a family company that can operate smoothly and well, equity is needed within the company. In company governance process, equality among family members or more specifically among brothers can be defined as equal share for all family members involved in the company. Additionally, equality can also be interpreted as equal treatment among family members. Poza and Daugherty (2014:6) define participatory as a natural process to include all family members involved in the company in management team, board member, or as company shareholder. Later, Aronoff and Ward (2011:13) explain consensus building as one of the efforts of a family to show their shared responsibility for everyone who is involved in the family business. RESEARCH METHODS This research chose qualitative approach. This research attempts to understand scientifically of a phenomenon happens in particular social situation, by emphasizing the process of deep communication interaction between the researcher and the phenomenon being examined. Case study was chosen as the method of this research, and the research sites were in Pasuruan and Surabaya. The researcher conducted interview technique by visiting the respondents. This
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process took time from November 2016 to January 2017. The informants were selected by conducting purposive sampling technique, a technique to select data sources with particular consideration (Sugiyono, 2012). Four people were selected as informants, the company founders (Mr. and Mrs. MT), second generation (DP), and informant expert (second generation that has implemented good corporate governance). Data were collected through interview, observation, and documentation. In this study, the researcher implemented check and recheck procedure to ensure that the data reliability. Data Analysis Accountability Accountability refers to the necessity and responsibility to provide explanations or reasons for all company activities and decisions. Accountability can be assessed from several aspects, namely establishment of corporate goals, company annual report, job description, and management structure and system. Setting goals of a family company includes all short term, medium term, and long-term targets. These targets are interpreted in form of corporate goals that are later communicated to all stakeholders and management. Financial report aims to communicate accounting information to help users make business decisions that are relevant to the company for maintaining and improving its financial position and performance. Job description is a list of job duties, responsibilities, job descriptions that are related to other jobs, working conditions, and required supervision responsibilities. Structure of company organization is a concept created to improve company performance through periodic supervision of corporate performance, and ensure accountability of working management. Transparency Transparency means that decisions taken by the board are appropriate and follow the rules. To maintain objectivity in doing business, company must provide relevant materials and information in a way that the stakeholders easily access and understand. Transparency can be assessed from several aspects, namely accounting system development, company transparency development through website, and wide enterprise management development. According to GEMI (Global Environmental Management Initiative) in Buntoro (2014), one of the things that can be observed to assess attention and transparency of a company according to the GEMI (Global Environmental Management Initiative) is the development of accounting systems based on accounting standard and best practices to ensure the quality of financial reporting and disclosure. For transparency through its website, the company’s family of the interviewees in this research has not been actively using information technology. However, the interviewees consider the use of technology important to support transparency. According to COSO Standard of Enterprise Risk Management Integrated Framework (in Wiryani, 2014), ERM is a process influenced by the board of directors, management and other personnel, applied in strategy setting that covers all aspects of a company. This process is designed to identify potential events that may affect the entity and to manage risks, in order to provide certainty for achieving the entity’s objectives. Fairness In building a family company that operates smoothly and well, equality in a family company and among brothers of the family can be interpreted as equal share of profit among all family members who have been in the company, as well as equal treatment among family members. Fairness can be observed from two aspects, namely equality in giving opinion and equality in family company compensation system. National Governance Committee (NCG, 2012) explains that fairness can be done by giving opportunity to minority shareholders to express opinions, thus giving equal treatment to the stakeholders and employees. CV. K is already committed to the principles of fairness based on the NCG since its establishment.
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Compensation is a form of return given by a company for its employees. It is undeniable that for all family members, compensation is also an important factor for them to decide whether they join the company or not. Fair and equal compensation for all family members involved in the company also has significant influence for the company sustainability. Participatory Participation is one of the main keys of good governance. This is a process of involving men and women, either directly or through institutions or representatives, in determining some steps that must be done through decision-making. To make sure that participation runs well, such form of participation must be informed and organized to the family members. The participation of each individual can vary because every individual certainly has a different way of thinking with its own positive values. If the positive values of each individual’s way of thinking can be well collaborated, idea can be well collaborated, it can get maximum results for the company when formulating strategies and making decision. Consensus Oriented Consensus is a fundamental aspect that combines family members’ commitment to continue and develop family business being inherited from the previous generation. Without a commitment among family members involved in a family company, the company cannot sustain. Consensus in the family company will also minimize conflict that can arise between individuals. Therefore, consensus significantly affects the survival of a family company. Table 1 displays the findings and implications in relation to the formulation plan of good family business governance that is proposed to CV. K. Table 1. Formulation Plan of Good Family Business Governance at CV. K Elements of Prior Research After Research governance Accountability
Transparency
• The financial statements were still prepared by staff; therefore, its accuracy is doubted • Long-term goal was already set • SOP already existed in accordance with ISOO
• KQ as the second generation begins to take over task in presenting real financial statements. • Defining performance evaluation constructively • Formulating business development in the coming year • Communicating vital company future planning • Shows an understandable assessment of the company's position and its prospects • Developing individual skills • Evaluating long-term goals and setting shortterm goals together • Evaluating SoP of each divisions and giving performance evaluation for each divisions in based on the SoP. • Developing an integrated financial system to present accurate financial statements. • Creating company website • Conducting meetings to identify risk per division and involving all management staff
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Fairness
Participatory
Consensus Building
• Calculating and re-analyzing the compensation system provided • Regulating the rights and obligations of each individual • Listening to all opinions and taking into account all opinions without distinction or distinguishing • Giving fair compensation to all parties, family members and employees, by taking company’s financial strength into account • Formulating strategic planning together • Making the design of a succession process and knowledge transformation • Reviewing shared vision and mission • Increasing each individual's commitment
Some differences between family business companies and non-family business companies are the existence of corporate governance mechanism and other unique tools used by family companies. The following tools have unique functions for family company to improve communication among family members and avoid conflict (Alderson, 2015:149): Family Constitution, Family Meeting, and Family Council. Writing family company constitution is one of the important tools in family governance to prevent and solve conflicts. This constitution is a written document that can be changed and changed to the latest version. This document has significant value to prevent and condition conflict before it can damage the company, by approving company rules since the beginning before negative emotions among family members escalate. Family meetings is also one of main devices of family business. This kind of meeting can be done in non-formal way, does not need regular schedule, and can be held anywhere. It can occur during family lunch or dinner, when family members have opportunities to talk about their business plans. Family council is commonly recommended by the consultants to improve communication and effectiveness in decision-making. Table 2 describes the process of implementing principles of Good Family Governance and three governance tools in CV.K from 2015 up to 2017. Table 2. Process of Implementing Principles of good family governance and three governance tools at CV. K 2015 2016 2017 * Accountability The job structure was not available yet, the division of task was also unclear. No vision and mission. Transparency No financial reports
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Accountability Already has vision and mission as it is now. Organizational structure has existed, yet there are dual positions Transparency Has created financial statements in the form of balance sheet reports, income statements and cash flow statements, yet the accuracy only reached 50%
Accountability Recruiting staffs Communicating planning formulation
Transparency The existence of an integrated financial system that can present a variety of real financial statements Creating company website
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Formulating wide risk management Fairness Recalculating compensation Dividing the dividend Participatory Creating succession and strategic planning process
Fairness The opinions of the second generation were heard Participatory The second generation (DP) entered the workforce, while KQ had just begun working Consensus Oriented The second generation still followed the first generation
Fairness The input of the second generation has been used Participatory The second generation made important decisions Consensus Oriented The second generation has begun to think about the company's survival and voiced her opinions
Consensus Oriented Reviewing consensus and increasing commitment.
Family Constitution Not available
Family Constitution Not available
Family Meeting Conditional, informal, done when there was a problem in business, and only 3 people got involved
Family Meeting Conditional, informal, done when there was a problem in business, and only 3 people got involved Family Council Not yet, and not required
Family Constitution Following professional sessions on family business Formulating process (currently still draft table of contents) Family Meeting Holding a family meeting with all family members with formal, structured, and clear meeting agenda Family Council Not yet, and not required
Family Council Not yet, and not required Conclusion This case study examines the formulation of Good Family Business Governance with CV. K as the examined family company. Family company is a company with high uniqueness as well as high level of complexity. Five principles are required in family corporate governance, namely accountability, transparency, fairness, participatory, and consensus oriented. Accountability refers to the necessity and responsibility to provide explanations or reasons for all activities and decisions taken by the company. At CV. K, the observable accountability before the research was conducted is the company’s vision and mission and organization structure although there double post existed in the structure. To maintain objectivity in doing business, company must provide relevant material and information in a way that stakeholders can easily access and understand, since it is the essence of transparency. Before this research was conducted, the aspect of fairness of CV. K’s financial statements only achieved 50% since the statements were written by staffs. Fairness itself is equity in a family company. Before the research was conducted, CV. K has already listened to the second generation’s opinion. Participation is a process to involve all family members, men or women, either directly or by institution or representative, in deciding steps to conduct through decisionmaking activity. For CV. K, its second generation has already participated in making important decision. Consensus building is used to make decision, where many opinions and recommendations are generated within the process.
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REFERENCES Otuo Serebour & Monia Castellini , (2015),"Corporate governance in an emergent economy: a case of Ghana", Corporate Governance, Vol. 15 Iss 1 pp. 52 - 84 Permanent link to this document: http://dx.doi.org/10.1108/CG-04-2013-0051 Alderson, Keanon. (2015),"Conflict management and resolution in family-owned businesses", Journal of Family Business Management, Vol. 5 Iss 2 pp. 140 - 156 Permanent link to this document: http://dx.doi.org/10.1108/JFBM-08-2015-0030 Andypratama, Lukas William & Ronny H. Mustamu. (2013). Penerapan prinsip – prinsip Good Corporate Governance pada Perusahaan Keluarga Studi Deskriptif pada Distributor Makanan. Surabaya : Jurnal Publikasi Jurusan Manajemen Universitas Kristen Petra. Aronoff, Craig E., dan Ward, John L.2011. Family Business Governance : Maximizing Family and Business Potential. First Edition, United States : Palgrave Macmillan. Aronoff, Craig E., dan Ward, John L.2011. Family Meeting : How to Build a Stronger Family and a Stronger Business. First Edition, United States : Palgrave Macmillan. Botero, Isabel C., Gonzalo Gomez Betancourt, Jose Bernardo Betancourt & Ramirez Maria Piedad Lopez Vergara , (2015),"Family protocols as governance tools", Journal of Family Business Management, Vol. 5 Iss 2 pp. 218 – 237 . Permanent link to this document: http://dx.doi.org/10.1108/JFBM-01-2015-0001 Bungin, H. Dan M. Burhan.2011. Penelitian Kualitatif : Komunikasi, Ekonomi, Kebijakan Publik Ilmu Sosial Lainnya. Edisi Kedua. Jakarta : Kencana Prenada Media Group. Dewanto, Wawan, Tirdasari, L. Nyanyu.2012. Entrepreneurship and Technology Management Research Group, Family Business Succession in Indonesia: A Study of Hospitality Industry. GEMI. (2011, September). Transparancy: a path to public trust. Retrieved from gemi.org retrieved April 12, 2011 Gonzalo Gómez Betancourt et al.(2014),"Emotional intelligence in family firms", Journal of Family Business Management, Vol. 4 Iss1 pp. 4 - 23 Permanent link to this document: http://dx.doi.org/10.1108/JFBM-08-2013-0020 Hoy, F dan Sharma,P. 2010. Entrepreneurial Family Firm. New York: Pearson Prentice Hall IFC Corporate Governance .2016. Family Constitution Case Study 2: The CarjavalGroup.http://philippines.smetoolkit.org/philippine/en/content/en/6741/FamilyConstitution-Case-Study-2-The-Carjaval-GroupKNKG. (2012). Prinsip dasar dan pedoman pelaksanaan GCG di Indonesia. Komite Nasional Kebijakan Governance. Jakarta. Kodrat, David Sukardi. 2010, Manajemen Eksekusi Bisnis, Yogyakarta : Graha Ilmu. Lieyanto, Andy & Ratih Indrayati. (2014). Penerapan prinsip – prinsip Good Corporate Governance pada Perusahaan Keluarga PT. Prima Raya Abadi Surabaya. Surabaya : Jurnal Publikasi Jurusan Manajemen Universitas Kristen Petra. Moleong, J. L, (2004), Metode penelitian kwalitatif. Bandung: Remaja Rosada Karya. Muntean, Susan Clark (2016),"Political behavior in family- and founder-controlled firms", Journal of Family Business Management, Vol. 6 Iss 2 pp. 186 - 206 Permanent link to this document: http://dx.doi.org/10.1108/JFBM-02-2015-0009 Mulyana, D, (2010). Metode Penelitian Kualitatif. Bandung: Remaja Rosdakarya Poza, E. J. (2009). Family Business. South Western: Cengage Learning. Puhantara, W (2010), Metode Penelitian Kualitatif untuk bisnis. Yogyakarta: Graha Ilmu Sugiyono, (2012), Memahami Penelitian Kualitatif. Bandung: Alfabeta Supriadi, D, (2011), Pokoknya Kualitatif : Dasar - dasar merancang dan melakukan penelitian kualitatif. Jakarta: PT Dunia Pustaka Jaya Stewart, Christian G. (2013). How to Craft your own Family Constituion. http://www.familylegacyasia.com/whitepaper_pdf
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Steffen Großmann Arist Von Schlippe , (2015),"Family businesses: fertile environments for conflict", Journal of Family Business Management, Vol. 5 Iss 2 pp. 294 - 314 Tunggal, H.S. (2013). Internal audit & Corporate Governance. Jakarta: harvarindo.
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