ANALYSIS IMPACT OF TRAINING ON EMPLOYEE PERFORMANCE AND JOB SATISFACTION

Destita Shari;
Universitas Nahdatul Ulama Surabaya

1.1 Research Background

Due to the fast pace global and technological development, the firms are now facing new changes as
well as challenges. Technological advancements have molded the need of capabilities and competencies required
to perform a particular task. The vast growing of economy in Indonesia resulted in a tough market competition.
Managers now started to realize that employees’ involvement in a company should stay in current with the new
knowledge and technology development based on what is needed by the company.
As the knowledge keeps on developing, thus the company is demanded to encourage the employees to
become more skillful and well-trained in order to accomplish the assigned tasks. Thus, to cope with these change
and challenges, the company should be able to provide more improved and effective training programs, because
training can help the employees to become more confidence and in turn will resulted in high job satisfaction at
work.
Employee is the blood stream and the most valuable assets of any business who will run the company.
The life of the company lies within the performance of the employees. In order to be functioned effectively, it is
the task of the human resource department to choose the appropriate person for the job. Employee development
is one of the most important function of the company, therefore, aside of selecting the right people, the company
itself should have plan to enhance the skills of the employees.
According to McKinsey (2006) states that improved capabilities, knowledge and skills of the talented
workforce proved to be a major source of competitive advantage in a global market. In addition to that, Meyer
and Allen (1991) continues that to develop the desired knowledge, skills and abilities of the employees, and to
perform well on the job, it requires effective training programs which will also affect the employee’s motivation
and commitment.
There is a direct relationship between employee development and employee performance. Thus, it is
essential that training is provided to ensure that employees can perform to the best of their ability for their own
development and to contribute to the growth of the company. Employee development means to encourage the
employees to acquire new or advanced skills and knowledge by providing learning and training facilities, and
place where such new ideas can be applied. Training has been known as equipment to set the tone of a business
and an important part in facilitating the success of the business.
According to Smith (2012), corporate training programs are designed in order to improve or sharpen
the skills of the employees in a centralized and unified manner. From the training program, the employees are
expected to perform better and becoming more contributive to the company. Based on Khan’s view (2011),
nowadays training has become the most important factor in the business world because training can help to
increase the effectiveness of both employees and the company itself. Providing the employees with training
allows them to develop their individual skills that will be able to lead to the overall success of the company.
According to Singh and Mohanty’s (2012) point of view, knowledge and skills of the employees have
become increasingly important to the performance, competitiveness and advancement. Whether the intention is
for increased sales, more efficient and effective production, better use of technology, or to produce reliable team
that can overcome its own obstacles, training can provide ways to help in achieving those goals. It should be
noted by the company that they first should find out the company’s training needs, enroll and choose the
appropriate employee on the right courses for the job.
When talking about employee performance, Champathes (2006) defines that when employee
performance would increase, this will lead to the organization effectiveness. Another supporting statement from
Elena (2000) implies that employee development activities are very important for the employees, as the activities
are performed; it indicates that organization cares about the employees and wants them to develop.
Unfortunately, business owners often find that the available training is too general and not appropriate to the
individual needs of the company. Small companies sometimes cannot afford to give the staff a spare time from
work to attend the training program during working hours.
There are hundreds of training companies ready to help small to big companies in developing and
enhancing the skills of the employees. Nonetheless, some employees might perform below expectations, even
after the training is given. The problem while designing training starts here. Sometimes managers give
trainings for the employees without analyzing what skills should be developed and needed within the company.
In relation to the discussion above, some employees may not have the intention to join the training
program knowing that the not well-designed training would be useless because the company is putting the
wrong people on the wrong place. This will leads to the feeling of less satisfy about the company and resulted
in high employee turnover and absenteeism. If there is a high employee turnover and absenteeism, the
company will put so much expense as they are doing the recruitment and selection process. These problems
will affect to the smooth running of a company because new hired employees cannot work directly as
professionals.
 In this research, the writer chooses PT. X in doing the analysis. PT. X is a multinational company which
has more than 3,000 employees spread around Indonesia. The head office is in Surabaya, with the total amount
of employees around 1,500 people. PT. X held much training to the employees; therefore the company was not
selective in choosing the training program. The company never make a list of training, and which one is the most
crucial and needed by the company that should be prioritized.
The biases happened especially when PT. X spend time and money the inappropriate training program
which sometimes very costly; the company did not communicate the benefits by joining such training; and there
is rare monitoring for continuous implementation in the daily work after the training program is given; thereby
having no impact to the overall performance of the company.
Due to the facts and concerns about training, the writer is interested to conduct a research in a field of
Human Resource Management with the title of, “Analysis Impact of Training on Employee Performance and
Employee Satisfaction”. This research study is aiming to help PT. X in finding the appropriate training program
which will have a good feedback to the employees and the company as a whole.

1.2 Problem Identification

Based on the above assumption, this study will identify several issues related to corporate training to
the employee performance and employee satisfaction, namely:
1. Is there any significant effect of training on the employees’ performance in PT. X?

2. Is there any significant effect of training on employee satisfaction of employees in PT. X?

3. Is there any significant effect of employee satisfaction on performance of employees in PT. X?

1.3 Research Objectives

According to the explanation above, the writer hope that this research paper will give a positive input
to PT. X and help the company in how to design an effective and efficient training for the employees. The
purposes of this study are as follows:
1. To understand the significant effect of training on the employees’ performance in PT. X.

2. To understand the significant effect of training on employees’ employee satisfaction in PT. X.

3. To understand the significant effect of employee satisfaction on employees’ performance in PT. X.

1.4 Benefit of the Research

This research analysis is expected to provide benefits to related parties, including:

1. The Company (PT. X).

The results of this study are expected to provide advice to be taken into consideration of the company in carrying
out the corporate training program and motivation towards its employees.

2. The Academic Party.

This research result might be used as an additional information and reference material especially for the under-
graduate students that are preparing for their final report projects.

3. Future Research.

The research results are expected to give guidelines in helping those who planned to hold a training in order to
make it more meaningful and have a good impact to the company and to the employee’s competency itself.

1.5 Scope of Study

 This study is emphasizing on corporate training and motivational strategies of only one subsidiary company of
PT. X.
 This study is aimed in understanding several factors in corporate training and motivation that may affect job
 performance.
 The study does not look at the financial aspects of corporate training cost analysis and salary of the employees.
CHAPTER II
LITERATURE REVIEW
2.1 Previous Researches

Raja Abdul Ghafoor Khan, Furqan Ahmed Khan, and Dr. Muhammad Aslam Khan (2011, has been
done research entitled “Impact of Training and Development on Organizational Performance”. The research’s
resulted that training and development has a positive effect on company performance. Sometimes companies
find it difficult to manage the time between the work and the training. Thus, the research is emphasizing towards
On the Job Training, because it is the most effective one and it also saves time and cost. Finally the company
can perform better as a whole.
Tightly related to the discussion above, Afshan et al., (2012) has been finished doing the research
entitled “Impact of Training on Employee Performance: A Study of Telecommunication Sector in Pakistan”.
The research is mainly focusing on how significant the impact of training is and how effective the training does
towards the employee performance. The results of the research are:
 Training has been given a primary importance so that the company can achieve the desired goals.

 Training need analysis is recommended to minimize the biasness while selecting the right candidates to be
involved in the training.
 It is better to clearly communicate to the employees about the benefits of the training so that they are willing to
participate wholeheartedly.
 If possible, the trainer should be from within the organization to make the trainees’ feel more comfortable in
discussing about the company’s issues and problems.
 Before and after training assessment is highly recommended to ensure about the effectiveness of the training
program.
A similar study had ever been undertaken by Permitasari under the title “Pengaruh Dimensi Pelatihan
terhadap Kinerja Karyawan pada Badan Pusat Statistik Kabupaten Magetan”. The result showed that the
training material, training tools, training methods, the trainer and the trainees have an impact to the employees’
performance simultaneously.
Other study had also been carried out by Andy Cosh et al., (2003) with the research title “The
Relationship between Training and Business Performance”. The research’s result is training has a significant
impact to the people’s performance. The amount of training held by the companies may vary, depending on
how big the firm is and in what sector the company’s is doing. It is likely that the amount of training a firm is
undertaking is tightly related to its ambitions towards the future growth.
Another similar research has been done by Rony Salinding (2011) under the title “Analisis Pengaruh
Pelatihan terhadap Produktifitas Karyawan pada PT. Erajaya Swasembada Cabang Makassar”. The research
resulted that training methods, training content, and the skill of the trainer have a great impact on the employee
performance. The training methods help the employee to have easier understanding about the training material
and contents. The skills that carried out by the trainer have been proven that it makes the trainees feel
comfortable, easily understand and applied the skills during and after the training program.

2.2 Training

Training is known as the educational process, where people can learn new information, re-learn and
reinforce existing knowledge and skills, and most importantly have time to think and consider what new options
can help them to improve their effectiveness at work. Training can give the employees the confidence to do their
job well.
Mainly the training is to train employees for doing a specific job or to rise up skill, knowledge, and
behavior of an employee. If a person is available internally from the organization that is competent enough for
training, then an in-house training could be arranged otherwise organization need to hire an expert from outside
the organization or external parties.
In short, the definition of training is a process to share skill and knowledge to extend and develop
capabilities for better job performance. Tightly related to the discussion above, Shaw (2013) implies that an
effective training saves labor by reducing time spent on problem-solving activities and also saves money in the
long run by producing a better workforce.
When discussing about training, Chrisogonus D. Pramudyo (2007) states that training is a process which
is designed to change the employees’ performance appraisal. According to Gary Dessker (2006), training is a
process of learning about the skills which is needed by the employee to do the work. Referring to some theoretical
views above, it is clear that training is an effort in order to increase the human resource and should be done
continuously. As the business keeps on developing, thus the employees should continuously develop their skills
and knowledge.
There are three requirements that should be fulfilled due to the training program. According to
Hariandja (2002), the three requirements are:
  A training program should be able to help the employees in enhancing their knowledge and skills.

 A training program should result a change in working behavior, towards information, and knowledge applied
in the daily working situation.
 A training program should be related to a specific job.

There are four things that a company should consider before conducting training, there is training
process, training materials, training candidates, and what skills should be trained based on the company needs.
Barak, Maymon and Harel (1999), states that training also has a significant impact on employee’s performance.
Firms can develop and increase the skills quality or competencies of the following employees by providing
comprehensive training and development program. Indeed, previous researches shown that when a company
investing in training the employees in problem-solving, teamwork and interpersonal relations will resulted in the
beneficial firm outcomes.
Based on Adrew E. Sikula’s (in Lisa Herdiana, 1981:227) view,

“Training is a short-term educational process utilizing a systematic and organizedprocedure by which non
managerial personnel learn technical knowledge and skills for a definite purpose. Development, in reference to
staffing and personnel matters, is a long-terms educational process utilizing a systematic and organized procedure
by which managerial personnel learn conceptual and theoretical knowledge for general purpose”.
According to Tannenbaum’s (1992) view, effective training programs are systematic and continuous.
In other words, training must be viewed as a tool to the continuous improvement rather than an infrequent and/or
a haphazard event. In conclusion, training is an effort to develop the knowledge and skills of the employees in
order to accomplish the tasks effectively and efficiently. Previous researches have been shown that training has
a good impact to the employee performance when the training is done appropriately.
2.2.1 Purpose of Training

Employee training should be done appropriately and continuously. The training program should be
designed carefully and depending on the skills needed by the company for the current situation and in the future.
The purpose of the training is for enhancing the technical skill, theoretical skill, moral and conceptual so that
the employee can reach the optimum results.
Employee training needs a huge investment of time and money, therefore the costs are a long-term
investment for the company because well-trained employees can work more efficient, effective and have better
results which will also impact in the increase of company’s competitive advantage. According to Mangkunegara
(2006), the purpose of training are increase the work productivity; increase the work quality; as a tool to help the
employees would reach a greater work achievement.
By doing an appropriate training program, it is guaranteed that there will be employees with good skills
and well-trained, and can help to increase the probability of the employee will stay longer in the company. The
employees will develop faster and better if they are being trained on the right hand. According to Carrel (in
Mangkuprawira 2002), the main purpose of training are to have better performance; increase the employees
skills; avoid the managerial obsolescence; and better in problem-solving activities. Carrel also recommend that
when a company is going to have a training, it is better to first communicate about what is the target of the
training itself.
Considering about the importance of training, a manager should develop an effective training program.
There are processes required in order to have an effective training program. Hariandja (2002) suggests that a
manager should first analyze the company’s needs; determine suggestions and training materials; determine the
training method and learning principals; and evaluating the training program.
Referring to some theoretical views above, it can be concluded that training is designed to stabilize the
employees, so that the company can reduce the turnover rate. By training and development program, the job can
be done effectively and efficiently. Training also can help to reduce the numbers of errors happen within the
company.
2.2.2 Benefits of Training

Staying competitive is the key to sustainable business. Training the staff and keeping them up-to-date
and motivated with industry trends and new technologies is essential to achieving that goal. Staff will benefit as
well by learning new skills and becoming a valued asset in any organization. Training brings direct benefits to
business and can be calculated as a return on investment. Most business people provide on-the-job training,
particularly during induction. A routine investment in ongoing training almost always shows a positive return on
investment, including improved work quality and productivity.
Hiring and retaining high quality employees is a good policy, but investing in developing their
knowledge and skills will tremendously increase their productivity. Training is commonly considered only for
new employees. This is a big mistake; the most successful institutions realize that ongoing training for existing
employees results in measurable results for the company.
According to Michael C. D. (2012), there are numerous benefits of investing in employee training,
including:
 Increased job satisfaction and morale among employees. This has an added benefit of making the company more
attractive to prospective employees.
  Ongoing training helps the employee adjust faster to the corporate culture and job expectations.

 Professional development and training enhances the company’s ability to make technological advances by having
sufficient knowledgeable staff.
 Training helps to build a more effective, efficient and highly motivated workforce , which boosts the sense of
pride in the company.

Training can help the employees to take more responsibility for the present time and in the future. Thus,
there are some reasons why training becomes a critical part in human resource management activity. According
to Mangkunegara (in Rony, 2006), the reasons why training should be held are as follows:
 New Employees: new hired employees really needs training and orientation program. They need the goals, rules
and employment guidelines which is being applied in the company. Therefore, they have to understand the
obligations, rights and a clear job description.
 New Inventions: The rapid development of knowledge and sophisticated technology, requires the employees to
be able to adjust with those changes.

2.2.3 Training Method

According to Hasibuan (2003), training method is intended as a systematic way that can give a broad
description in order to organize training in order to encourage participants to develop cognitive and
psychometric aspects in the completion of tasks and jobs assigned. Continuing about the training methods
discussion, a journal published by the Trainer Development Conference, there are ten training methods that can
be used by a company, the methods are as follows:
Training How to do Advantages
Method it?

A person or a
team member
perform a task It may
and explain it provide a
to the rest of hands-on
the training experience
member. (audio –
Demonstration visual
usually experience),
followed up and training
by having a participants
Demonstration practice task. may get
This method is plenty of
useful in attention
teaching a from the
skill when instructor.
plenty of time
is available.

A planned It broaden
conversation the
(exchange knowledge
Discussion ideas or by allowing
viewpoints) the multiple
on a particular points of
 or selected view to be
topic, guide expressed
by a trained and it allows
discussion all learners to
leader. become more
expressive in
sharing
opinions and
able to
respect other
people’s
different
viewpoints.

The point
Realistic may be
situation or a relevant to
series of the real life
actual events experiences
presented to of the
the learners, learners. It
Case Study either orally or forces all

by handout, to learners to be
analyze the more
problems and decisive in
find the best decision
solution. making
process.

This method
is the most
Simulation realistic and
hands-on
method is
because the
used to learners
directly feel
recreate
by seeing and
environments doing. It is
probably the
where
most
Simulation participants
involving
type of
experience the
experiential
potential learning.
situations
which might
happen.

Brainstorming Brainstorming Everyone’s

 is a good ideas are
method in counted and
problem no one is
solving being
situations. All ignored and
the group this saves
members time because
should suggest all the ideas
ideas of of possible
possible solutions are
solutions, in a gathered
rapid-fire quickly.
order, either
oral or
written.

2.3 Employee Performance

The most vital problem in a company is its employee performance. High employee performance is a
total expectation from the company. It can also be defined either as skill of person in doing his job and tasks.
According to Hawthorne studies and many other research works on productivity of worker highlighted
the fact that employees who are satisfied with their job will have higher job performance, and thus supreme job
retention, than those who are not happy with their jobs. Based on Kinicki and Kreitner (2007), states that
employee performance is higher in happy and satisfied workers and the management find it easy to motivate
high performers to attain firm targets.
Tightly related to the discussion above, Pfeffer (1994) states that well-trained workforce is more capable
of achieving performance targets and gaining competitive advantage in the market. Employee’s performance is
important for the company to make every effort to help the low performers. Performance is classified into five
elements: planning, monitoring, developing, rating and rewarding.
The word “performance” is come from the word Job Performance or Actual Performance. According
to Byar and Rue (in Sutrisno, 1984) explains that achievement or performance as a degree of skill in how people
accomplish the tasks.
Based on Hameed and Waheed’s view (2011), employee performance means employee productivity
and output as a result of employee development. In this research paper, there are two kinds of employee
performance indicators used to measure the degree of employee performance; they are input factors (skills and
behavior) and output factors (quality and timeliness).
2.3.1 Input Factors
2.3.1.1 Skills

Tightly related to the discussion above, Tharenou et al. (2007) training can be viewed as an investment
in human capital which is a tool for the employees to be able to acquire unique knowledge, skills and abilities
that add value to the firm. With one’s skills and abilities, it enables them to achieve organizational goals, thus
will resulted in positive organizational – level outcomes.
According to Hameed and Waheed (2011), skill growth means to increase in the skill inventory level
of an employee. The skill growth is possible through training and coaching. The skill level will affect on the
employee performance. Employee performance will affect the organizational effectiveness. The degree of skills
also depends upon the individual employee, how much curiosity to learn. (a) How much curiosity to learn an
individual employee?; (b) How to learn to develop themselves?.
2.3.1.2 Behavior

Employee behavior is defined as an employee’s reaction to particular situation at workplace. The

employees need to behave sensibly at workplace, not only because one wants to get appreciation and respect
from others, but also to maintain a healthy work culture. In relation to behavior, Okanya (2008), the desired role
behaviors should then lead to positive organizational outcomes.
Most importantly, one needs to adhere to the rules and regulations applied in the workplace. One should
remember that office is not a place where people can shout on fellow workers, spread rumors, criticize your boss,
 and so on. Such behavior is counted as unprofessional.
2.3.2 Output Factors

2.3.2.1 Quality

The quality of work is the result of the hard work of the employees in accordance with the company
goals. If the end result being achieved by the employees considered good by the company, this means that there
is a level that shows the process of the work or the result being achieved for a job which is nearly perfect.
2.3.2.2 Timeliness

Employees can work according to the standard working hours which being set by the company. By
working under the specified standard time, then it can be said that the employee performance is good. Timeliness
can also be mean as being discipline at work. With timeliness, it means that a level which indicates that a job
can be accomplished faster than the specified time, then the employees’ performance has been good.

2.4 Job Satisfaction

Job satisfaction is a non-monetary reward that a worker aimed for apart from his/her direct income as a
consequence of his/her productive activity.
Previous research has shown many factors that affecting job satisfaction. These factors can have positive
and negative impact on employee’s job satisfaction in an organization. However, the importance of the various
factors appears to change from one situation to another. That is, individuals who perform the same job in the
same environment and at the same time do not all derive the same degree of satisfaction.
According to Mullins (2006), job satisfaction is affected by a wide range of variables including
individual, social, cultural, organizational and environmental factors. In this research, there are four indicators
being used. The explanations will be as follows:
2.4.1 Salary and Fringe Benefits

The early understanding of pay (pay and salary are often used interchangeably) in any organization was
that of paying individuals so they could satisfy their needs, such as buying food and clothes. However, pay can
mean much more than merely being able to satisfy physical needs. According to Locke (1976), pay can be seen
by one worker as a symbol of achievement and as a source of recognition. Much more than that, Aksu and Aktas
(2005) states that employees are very sensitive to salary issues because of impact on living standards and its
importance in providing a sense of security.
Several researchers have been investigated about salary and its effects on job satisfaction. This attention
was due to the old belief that to satisfy the workers, one should pay them more. Another view from Luthan
(2005), salary is a tool for achieving both people’s lower and higher needs.
In relation to the discussion above, according to Rollinson (2008), he stated that there seems to be a
connection between salary and satisfaction when an employee perceives their salary to be equitable with respect
to what others receive. Based on Williams’ et al. view (2006), he reported that fairness and equity is a more
important determinant of pay than the actual level of pay.
Nevertheless, a low salary is not the only factor that can drive one into dissatisfaction. There are still
some other factors that still cause dissatisfaction, such as lack of autonomy, fairness, opportunities for
advancement and recognition.
2.4.2 Promotion Opportunity

Promotion refers to the act of moving an employee up to the organizational hierarchy, usually leading
to an increase in responsibility and status and a better remuneration package. Promotion is also an important
aspect of a worker’s career and life, affecting other facets of the work experience. With regard to this discussion,
Vroom (1982) argued that promotional opportunity is a goal most desires by the workers and that
an individual’s performance is related to the degree to which the individual believes that being promoted is
related to performance on the job and how strongly the individual desires the promotion.

Studies of employee satisfaction have identified promotional opportunities as an environmental

antecedent to job satisfaction. For example, if a job offers the opportunity of promotion in the future, it provides
more satisfaction. If the opportunity for such promotion is limited, this reduces satisfaction. According to
Schneider et al. (1992), states that employee who perceives few opportunities for advancement have negative
attitudes toward their work and their organizations.
2.4.3 Relationship with Co-Workers

According to Rollinson (2008), the factor of relationship with co-workers reflects the extent to which
members of an individual’s workgroup are perceived to be socially supportive and competent in their own tasks.
Indeed, the social context of work is likely to have a significant impact on a worker’s attitude and behavior.
Based on Ellickson and Longsdon’s (2001) view, the relationship with co-workers factor was found to be one of
the most important factors on job satisfaction.
 In relation to the discussion above, Price and Mueller (1981) stated that whatever the position of workers
in an organization, whether managers or blue collar workers, the nature of the relationship between co- workers
is fundamental to the achievement of job satisfaction. Having the support of other workers, both superiors and
subordinates, will generally create feeling of satisfaction within the organization.
2.4.4 Workplace Facilities

Working facilities are tools being served by the company in order to help all the activity runs well.
According to Simanjuntak (1985), in supporting the improvement of employees’ productivity and performance,
the company could support them by giving such facilities:
a. Dealing with employee well – being. The company can give more facilities in terms of salary (such as
incentives) and also social security such as life insurance.
b. Dealing with working environment, including technology (computers, photocopier, fax) and production
system, tools and production utilities being used and the level of safety at work.
c. The working condition itself, such as lighting, AC, working space (some people are just feeling uncomfortable
sitting too close to each other).
2.5 Relationship between Variables

2.5.1 Training and Employee Performance

In the development of organization, training plays a vital role, improving performance as well as
increasing productivity, and eventually putting companies in the best position to face competition and stay at the
top. Based on April’s view (2010), this means that there is a significant difference between the
organizations that train their employees and organizations that do not. Training is type of activity which is
planned, systematic and it results in enhanced level of skill, knowledge and competency that are necessary to
perform work effectively (Gordon, 1992).
2.5.2 Training and Employee Satisfaction

According to Moses (1999), one of the most difficult thing people cope with in today’s workforce is the
constant feeling of needing to sell oneself with no time to achieve personal or professional goals. Training can
bring a big impact in alleviating such feelings. Based on Garger’s view (1999), employees have difficult times
caring about the company they work with, if they do not believe the company also cares about them.
Tightly related to the discussion above, according to Jurkiewicz (2000) stated that there are two factors
which will impact the employees’ satisfaction and commitment, there are the feelings where the organization
can rely on to carry out its commitment to the employees and feelings that every single person is an important
part of the organization. Gerbman (2000) continues that there should be a win-win solution where not only the
aining
company needs the employees in reaching the success, but also employees need to feel like they are making a
difference in achieving the company’s objectives.
In relation towards the relationship between training and job satisfaction, Moses (2000) states that
people enjoy feeling that their work has a purpose and their activities have significant impact to the company.
Companies utilizing training or employee development program are experiencing higher employee satisfaction
with lower turnover rates. Wagner (2000) states that although salary and fringe benefits play bigger role in
recruiting and retaining employees, people are also seeking for opportunities in learning new things, challenge
of new responsibilities, and the prospect of personal and professional growth.
Supporting employees through career planning and development has made their workforce more
motivated and invested in the company in meeting its goals and objectives. The Gallup Organization, through its
poll called “Employees Speak Out on Job Training: Findings of a New Nationwide Study,” (in Wagner, 2000)
found that the level of employee satisfaction and employee retention is increasing when a company is willing to
train its workers. Satisfied employees lead to satisfied customers, which is definitely a financial benefit to the
company.
2.5.3 Employee Satisfaction and Employee Performance

According to Robins (1999) states that the first view about the relationship between employee
satisfaction and employee performance can be summarized as: “productivity of a happy worker is higher”.
Previous researches have been shown that there is a significant impact between satisfaction and performance. A
satisfy employee will lead to higher productivity, organizational responsibility, physical and mental health,
so an employee will work with better mood and eager to learn more skills.
There are many reasons that show satisfaction as a result of good performance and awards also have
significant role in it. The rewards will satisfy employees. According to Dizgah et al. (2012), there are three
theories: performance lead to satisfaction; satisfaction lead to performance; award is a medium between
satisfactions and performance. Award is not only promotes the performance, but also the affect the degree of job
satisfaction. Stirs and Porter (1991) states that: “the higher motivation and more positive attitude toward job, the
higher performance one will have, and vice versa”.
2.6 Framework
 Workplace

Employee
Satisfaction

H2

Tr
H3

H1

Employee
Performance

Behavior

2.7 Hypothesis

The hypotheses in this research are as follows:

H1: Training has positive impact towards employee performance.
H2: Training has positive impact towards employee satisfaction.
H3: Employee satisfaction has positive impact towards employee performance.
CHAPTER III

RESEARCH METHODOLOGY

3.1 Research Design

The research begins with the literature based study to give out the conceptual role of training in general.
Next, a specific literature in regard to the rest of the variables which will be tested, which are the literature of
job performance and job satisfaction are carried out to give a better and clear understanding about the indicators
which are being measured in each variables.
This research is using quantitative methods. According to Hopkins (2000), quantitative research’s aim
is to determine the relationship between one thing (an independent variable) and another (a dependent or outcome
variable) in a population. Based on Aliaga and Gunderson’s view (2000), quantitative research is explaining
phenomena by collecting numerical data that are analyzed using mathematically based methods.
Tightly related to the discussion above, Trochim (2006) stated that quantitative research focuses on
analyzing numerical data. The approach often follows particular scientific methods (e.g. design, sampling,
measurement). Quantitative research designs are either descriptive (subjects usually measured once) or
 experimental (subjects measured before and after a treatment).
This type of research being used is the causal research which is one of conclusive research type where
there are two or more variables with a causal relationship. Causal research attempts to establish cause-effect
relationships among the variables. In this study, the effect of training on performance and job satisfaction will
be observed in one division of a multinational company in Surabaya. (di bidang gas).
3.2. Population and Sample

3.2.1. Population

Population is a group of individuals or items that share one or more characteristics from which data can
be gathered and analyzed (investorwords.com). According to Rony (2011), population is all the objects and
subjects with certain characteristics which will be analyzed. It is the group of people whom the researcher hopes
to apply the result of the research.
The most important thing is that the researcher has to determine the population before the sample is
taken and the treatments are given. Based on the research title, the participant will be the employees of PT X. PT
X has the total population of nearly 3,000 workers spreading all around Indonesia, and approximately 350
workers in Surabaya area. To be involved in the survey, the participants (respondents) had to be the employee
of PT X, already work at least for three years in the company, ever involved in training program either from
internal party or external party.
3.2.2. Sampling

Sampling is a process used in statistical analysis in which a predetermined number of observations will
be taken from a larger population. According to Wilford (2008), sampling may be defined as measuring a small
portion of something and then making a general statement about the whole thing.
Sampling is a part of statistical practice concerning in the selection of an unbiased or random subset of
individual observations within a group of individuals intended to yield some knowledge about the population of
concern, especially for the purposes of making predictions.
When taking a sample from a larger population, it is important for the researcher to consider how the
sample be drawn. The methodology used to sample from a larger population will depend on the type of analysis
being performed. In this research, the sampling technique used is simple random sampling.
According to Daniel (2012), simple random sampling is a probability sampling procedure that gives
every element in the target population, and each possible sample of a given size, an equal chance of being
selected. There are some major steps in selecting a simple random sampling:
a. Define the number of population.

b. Identify an existing sampling frame of the target population.

c. Determine the sample size.

d. Randomly select the targeted number of population elements.

The technique which is typically being used is the last one, which is called as “the lottery method”. The
lottery method is consist of a table of random numbers and randomly generated numbers using a computer
program. The lottery method is also known as the “blind draw method” and the “hat model”.
In relation to the discussion above, Hair et al. (1995, in Ferdinand, 2006) states that the determination
of the number of respondents plays an important role in the estimation and interpretation results, especially when
the researcher is using the analysis method of Structural Equation Modeling (SEM). The ideal size of respondents
is depending on the number of indicators, multiplied by 5 – 10. Thus, the respondents for this research are as
follows:
 Minimum Sample = The amount of Indicator X 10

= 11 X 10

= 110

Then Hair et al. (1995, in Ferdinand, 2006) also states that the sample size which is suitable for using
SEM is 100 – 200 samples. In regard with Hair’s opinion, this research will use 100 sample sizes from the
respondents.
3.3 Research Instrument

According to Wilford (2008), research instrument is a tool for gathering the data in research which is
being used as a basis for drawing conclusions or making some inferences. There are several types of research
instruments, some of these tools are questionnaires, interviews and empirical observations as they conduct the
proposed study.
In this research, the researcher chooses to use the questionnaire method as a tool to gather the data.
 Based on Sobrepena’s view (2011), questionnaire is a tool of research for obtaining the data; this method will
really help especially for the respondents who are beyond the physical reach from the researcher. There are some
guidelines in using the questionnaire method: clarity of language; singleness of purpose; relevant to the objective
of the research; correct grammar.
Tightly related to the discussion above, Sobrepena (2011) also stated that by using questionnaire
method, it is easier to test for the reliability and validity; less time-consuming than interview and direct
observation. In this study, the list of questionnaire method consists of:
Variables Indicators

Training  Training Method

 Training Benefit

 Training Purpose

Employee Performance  Input Factors:

a) Skill

b) Behavior

 Output Factors:

a) Quality

b) Timeliness

Employee Satisfaction  Salary and Fringe Benefits

 Promotion Opportunity

 Relationship with Co-Workers

 Workplace Facilities

3.4 Operational Definitions of Variables

3.4.1 Training Variable

When talking about training, according to Pramudyo (2007:16), states that training is a process which
designed to change the employees’ performance appraisal. The research will use three indicators of training
which will be explained further below:
a) Purpose of Training.

According to Mangkunegara (2006:52), the purpose of training are increase the work productivity; increase the
work quality; as a tool to help the employees would reach a greater work achievement.

b) Benefits of Training.

Staff will benefit as well by learning new skills and becoming a valued asset in any organization. Training brings
direct benefits to business and can be calculated as a return on investment.

c) Training Method.

According to Hasibuan (2003:77), training method is intended as a systematic way that can give a broad description
in order to organize training in order to encourage participants to develop cognitive and psychometric aspects
in the completion of tasks and jobs assigned.
3.4.2 Employee Performance Variable

The most vital problem in a company is its employee performance. High employee performance is a
 total expectation from the company. It can also be defined either as skill of person in doing his job and tasks. In
this research paper, there are two kinds of employee performance indicators used to measure the degree of
employee performance; they are input factors (skills and behavior) and output factors (quality and timeliness).
a) Input Factors

 Skills: The skill level will affect on the employee performance. Employee performance will affect the
organizational effectiveness.
 Behavior: Employee behavior is defined as an employee’s reaction to particular situation at workplace. The
employees need to behave sensibly at workplace, not only because one wants to get appreciation and respect
from others, but also to maintain a healthy work culture.
b) Output Factors

 Quality: The quality of work is the result of the hard work of the employees in accordance with the company
goals.
 Timeliness: Employees can work according to the standard working hours which being set by the company.

Timeliness can also be mean as being discipline at work.

3.4.3 Job Satisfaction Variable

Job satisfaction is a non-monetary reward that a worker aimed for apart from his/her direct income as a
consequence of his/her productive activity. In this research, there are four indicators being used. The
explanations will be as follows:
a) Salary and Fringe Benefits.

Employees are very sensitive to salary issues because of impact on living standards and its importance in
providing a sense of security.

b) Promotion Opportunity

Promotion refers to the act of moving an employee up to the organizational hierarchy, usually leading to an
increase in responsibility and status and a better remuneration package.

c) Relationship with Co-Workers

The social context of work is likely to have a significant impact on a worker’s attitude and behavior.

d) Workplace Facilities

Working facilities are tools being served by the company in order to help all the activity run well, dealing with
employee well-being, working environment, and the working condition itself.

3.5 Technique of Data Analysis

This research paper will use Structural Equation Modeling (SEM) as the technique in analyzing the
data. SEM has become one of the techniques of choice for researchers across disciplines and increasingly is a
‘must’ for researchers in the social sciences. According to Suhr (2000) states that SEM is a methodology for
representing, estimating, and testing a network of relationships between variables (measured variables and latent
constructs).
According to Joreskog and Sorbom (2004) states that SEM is a double variable technique which can be
used to describe the linear relationship among the observation variables simultaneously, which also involves the
latent variable which cannot be measured directly. In relation to Joreskog and Sorbom’s view, according to
Anglim (2007), SEM can be used to estimates the relationship between latent variables, allows for explicit tests
of competing models, explore direct – indirect – and total effects, and also explore multivariate relationships in
an integrated manner.
Tightly related to the discussion above, Sitinjak and Sugiatro (2006) states that the latent variables are
abstract concept (construct) which can be concerned and can only be observed in an indirect way through its
effect on the observed variables (indicator variables).
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