The Relevance of Financial and Non-Financial Compensation on Professionalism and Lecturers Performance: Evidence from Makassar Private Universities (Indonesia)

Muhammad Hamzah Idris, Djabir Hamzah, Indrianty Sudirman, Nurdjanah Hamid


This study aimed to test empirically the effect of financial and non financial compensation on professionalism and lecturer’s performance. The study population was all lecturers who are certified, public and private lecturers at the private universities in Makassar (Indonesia). Stratified proportional random sampling was used to obtain the total sample of 111 lecturers’. Covariance-based SEM (SEMPLS) with a WarpPLS 5.0 used in this study. The results of the study provide evidence that financial and non financial compensation has a positive and significant effect on the lecturer’s professionalism. Financial compensation has a positive and significant effect on the lecturer performance but non financial compensation did not. The level of professionalism has a positive and significant effect on the lecturer’s performance. Professionalism can be evident as a mediating role in explained effect of financial and non financial compensation on lecturer’s performance.

Full Text:



Akhter, N., Ijaz, M., Siddiqi, U. I., Shouqat, U., & Raza, A. (2016). Impact of Compensation Discrimination on Employees Performance in Engro Food Limited, Alhamd Food Limited and Leader industry Sahiwal of Pakistan. International Review of Management and Business Research, 5(2), 547

Alam, S. (2015). Effects of Conflict Mediation Role and Ambiguity Role in Leadership and Communications to Organizational Commitment and Performance of Private Higher Education Lecturers in Makassar. Doctoral Program of Economics and Business Sciences Hasanuddin University. Makassar

Angrist, J. D., & Acemoglu, D. (2001). Consequences of Employment Protection? The Case of the Americans with Disabilities Act. MIT. USA

Armstrong, M. (1999). Hand Book of Human Resource Management Practice (7th ed.). London; Kogan Page Ltd.

Arwildayanto. (2013). Human Resource Management Higher Education Cultural Approach Professional Lecturer. Alfa Beta Bandung.

Baron, R. M., & Kenny, D. A. (1986). The moderator-mediator variable distinction in social psychological research: Conceptual, strategic and statistical considerations. Journal of Personality and Social Psychology, 51, 1173-1182.

Bellois, D. (2003). The role of professional code in work performance. Journal of Management Sciences, 6(11), 41-59.

Borman, W. C., & Motowidlo, S. M. (1993). Expanding the criterion domain to include elements of contextual performance. Personnel Selection in Organizations; San Francisco: Jossey-Bass, 71.

Boyt, T. E., Lusch, R. F., & Naylor, G. (2001). The role of professionalism in determining job satisfaction in professional services: A study of marketing researchers. Journal of Service Research, 3(4), 321-330.

Burki, S. J., Perry dan, G. E., & Dillinger, W. R. (1999). Beyond the Center: Dezentralizing the State. The World Bank, Washington DC

Dali, N., & Mas'ud, A. (2014). The Impact of Profesionalism, Locus of Control, and Job Satisfaction on Auditors' Performance: Indonesian Evidence. International Journal of Bussiness and Management Invention, 3, 63-73.

Dali. Nasrullah, Armanu, Margono Setiawan & Solimun, (2013). Professionalism and Locus of Control Influence on Job Satisfaction Moderated By Spirituality at Work and Its Impact on Performance Auditor. International Journal of Business and Management Invention, 2(10). 1-11.

Darling-Hammond, L. (2000). Teacher quality and student achievement. Education policy analysis archives, 8, 1.

Dessler, G. (1998). Human Resource Management (vol. 2). Prenhallindo, Jakarta

Gibbs, B. (1994). Professionalism: The first ethical code. Career management journal, 16, 171-184.

Hackman, J. R., & Suttle, J. L. (1977). Work design. Improving life at work: Behavioral science approaches to organizational change.

Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2013). A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). Thousand Oaks: Sage

Hall, R. (1968). Professionalism and bureaucratization. American Sociological Review, 33, 92-104.

Hameed, A., Ramzan, M., & Zubair, H. M. K. (2014). Impact of compensation on employee performance (empirical evidence from banking sector of Pakistan). International Journal of Business and Social Science, 5(2).

Harefa, A. (1999). Awakening the Spirit of Professionalism. Jakarta: Gramedia

Hasanuddin, R., & Sjahruddin, H. (2017). The Structure of Emotional Intelligence, Spiritual Intelligence and Its Relationship with Work Enthusiasm and Auditor Performance. World Journal of Business and Management, 3(1), 67.

Kalbers, L. P., & Fogarty, T. J. (1995). Professionalism and its consequences: A study of internal auditors. Auditing, 14(1), 64.

Kaplan, L. S., & Owings, W. A. (2001). Teacher quality and student achievement: Recommendations for principals. NASSP bulletin, 85(628), 64-73.

Kerr, S. (1975). On the folly of rewarding A, while hoping for B, Academy of Management Journal, 18(4), 769-83.

Kock, N. (2010). Using e-collaboration WarpPLS in studies: An overview of the main five analysis steps. International Journal of e-Collaboration (IJEC), 6(4), 1-11.

Kock, N. (2011). Using e-collaboration WarpPLS in studies: Descriptive statistics, settings, and key analysis results. International Journal of e-Collaboration, 7(2), 1-17.

Kock, N. (2013). Using WarpPLS in E-Collaboration Studies: Descriptive Statistics, Settings. Interdisciplinary Applications of Electronic Collaboration Approaches and Technologies, 62.

Kwon, K. J., Ko, K. H., Kim, K. W., & Kim, J. A. (2010). The impact of nursing professionalism on the nursing performance and retention intention among psychiatric mental health nurses. Journal of Korean Academy of Nursing Administration, 16(3), 229-239.

Luthans, Fred, (2005). Organizational Behavior (10th, ed,), Translated by: Vivin Andhika Yuwono; Shekar Purwanti; Th. Arie Prabawati; And Winong Rosari.Perb Publisher Andi, Yogyakarta.

Mondy, R. W. (2008). Human Resource Management (Vol. 1, 10th, ed.). Erlangga, Jakarta.

Nyström, S. (2009). The dynamics of professional identity formation: Graduates' transitions from higher education to working life. Vocations and Learning, 2(1), 1-18.

Nzulwa, J. (2014). Motivational Factors Affecting High School Teachers' Professional Conduct and Work Performance: A Case of Public High Schools in Nairobi City. International Journal of Humanities and Social Science, 4(3), 60-66.

Omenn Strunk, K., & Robinson, J. P. (2006). Oh, won't you stay: A multilevel analysis of the difficulties in retaining qualified teachers. Peabody Journal of Education, 81(4), 65-94.

Peterson, S. J., & Luthans, F. (2006). The impact of financial and nonfinancial incentives on business-unit outcomes over time. Journal of applied Psychology, 91(1), 156.

Republic of Indonesia. (2005). Law of the Republic of Indonesia number 14 of 2005 on Teachers and Lecturers. State Secretariat. Jakarta

Rivai, V. (2011). Human Resource Management for Companies from Theory to Practice. PT. Rajagrafindo Persada, Jakarta.

Rusydi, M. (2014). Influence Leadership and Empowerment to Competence and Job Performance. Doctoral Program of Economics Faculty of Economics and Business Universities Hasanuddin. Makassar.

Schmidt, F. L., & Hunter, J. E. (1998). The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings. Psychological bulletin, 124(2), 262.

Sholihin, M., & Dwi, R. (2013). SEM-PLS with WarpPLS 3.0. Andi. Yogyakarta

Sofyan, A. (2012). Analysis of the Effect of Grant Allowance Certification and Education and Training of Lecturer Performance Improvement and Performance Faculty at University of North Sumatra. Graduate School of University of North Sumatra.

Stajkovic, A. D., & Luthans, F. (2003). Behavioral management and task performance in organizations: conceptual background, meta‐analysis, and test of alternative models. Personnel Psychology, 56(1), 155-194.

Surbakti, A. (2011). Influence Analysis of Compensation, Training and Motivation on Performance Lecturer at Computer Science High School (STIKOM) Medan (Doctoral dissertation).

Tanjung, B. N. (2015) the Effect of Principal Leadership, Compensation, and Work Motivation on Teacher Professionalism at Private High Schools in Medan. IOSR Journal of Humanities and Social Science (IOSR-JHSS), 20(5).

Thompson, A. A., & Strickland, A. J. (2001). Strategic management: Concepts and cases. McGraw-Hill/Irvin.

Uno, H. B., & Lamatenggo, N. (2012). The theory of performance and measurement. Jakarta: Bumi Aksara.

Wayne, A. J., & Youngs, P. (2003). Teacher characteristics and student achievement gains: A review. Review of Educational research, 73(1), 89-122.

Whitmore, J. (1997). Coaching Performance. Jakarta : Gramedia Pustaka. Utama

Yousaf, A., Yang, H., & Sanders, K. (2015). Effects of intrinsic and extrinsic motivation on task and contextual performance of Pakistani professionals: the mediating role of commitment foci. Journal of Managerial Psychology, 30(2), 133-150.



Copyright (c) 2017 Journal of Asian Development

Journal of Asian Development  ISSN 2377-9594   E-mail:

Copyright © Macrothink Institute 

To make sure that you can receive messages from us, please add the '' domains to your e-mail 'safe list'. If you do not receive e-mail in your 'inbox', please check your 'spam' or 'junk' folder.