Employee engagement as a driver of performance improvement: A case study of foreign companies in Indonesia

Abstract

This study investigates the mediating role of employee engagement in the relationship between innovativeness and intrinsic motivation on employee performance in foreign companies in Indonesia. Data were collected through online surveys targeting permanent employees, resulting in 296 valid responses. Partial least squares structural equation modeling (PLS-SEM) was employed for data analysis. The findings reveal that innovativeness does not significantly affect employee performance either directly or through employee engagement. In contrast, intrinsic motivation positively influences employee performance both directly and through the mediation of employee engagement. These results suggest that enhancing employee engagement can improve the performance of employees in foreign firms. These findings are valuable for decision-makers seeking strategies to increase competitiveness in dynamic business environments.