THE EFFECT OF MANAGEMENT SYSTEM ON CORPORATE PERFORMANCE (A Study of 179 Companies, Manufacturing Sector, Listed on the Jakarta Stock Exchange Year 1998 - 2000)
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Date
2015-08-04
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2015 International Conference of Organizational Innovation (ICOI 2015), International Association of Organizational Innovation, USA; Airlangga University, Surabaya, Indonesia; Huaqiao University, China; Chang Jung Christian University, Taiwan ROC
Abstract
This study proposed the concept of management system as one of the variables that
are considered to have an influence on the resulting performance of the company,
meant that by applying the participatory management system, which is considered as
the most ideal management system, the performance of the companies have a
tendency to be better when compared to the company which implements a non -
participatory management system.
This study has three main objectives, namely: (i) analyze the extent to which the
implementation of the Management participatory system by a number of companies in
the manufacturing sector, (ii) analyze the performance of a number of manufacturing
companies ranging from 1998-2000, and (iii) analyze the influence that occurs
between the implementation of management system to the company performance.
Measurement tool for management system, implemented by the company, using a
questionnaire “Profile of the Organizational Characteristic” developed by Rensis
Likert (1986). Corporate performance measurement using two items of financial
performance, namely Return on Investment (ROI) and Return on Equity (ROE) .
These results indicate that : (i) only 7 % or 25 companies that implement participatory
management system of the 28 sampled companies, (ii) the performance of the
resulting company is generally very low, the average values for the ROI are -7.81 and
ROE is -118.8 , (iii) there is no significant relationship between the application of the
management system to company's performance, it can be known through the scale
coefficient of determination (R2) of 0.109 or 10.9 % of ROI and 0.018 or 1.8 % for
ROE.
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Keywords
Management System, Authoritative, Benevolent Authoritative, Consultatif, Participative, Company Performance, Go-Public, Profile of the Organizational Characteristic.