Uplifting Indonesia’s Capital Market Industry through its People

Human resources practitioners are working hard to create a more effective and efficient workforce as the market conditions change rapidly and competitive pressure continues to strike. As the competition becomes a global issue, organisations need to be supported by the efficient human resources with sufficient competence and attitudes that are in line with its business needs. Indonesia Stock Exchange (IDX) is just like any other organisation regarding this matter, yet on the other hand, it also has a complete set of unique characteristic due to its role as Indonesia’s Capital Market Regulator. Besides ensuring an organized, fair and efficient market in Indonesia’s capital market sector, IDX also acts as an agent of growth of the national economy by being the source of financing outside the banking industry for both local and foreign investors.

Recognized as one of the best place to work in Asia by HR Asia last year, along with its accomplishments on the record-breaking rise of Jakarta Composite Index (JCI) of 6.355 and 37 additional listed companies which is above other countries in South East Asia, IDX needs to put more focus not only to its strategy but also to its people to continue its success this year. Moreover, in this volatile, uncertain, complex and ambiguous (VUCA) era, any organisations are becoming increasingly reliant on employees who are willing to perform the extra-role behaviour

Following to this issue, I did a research in IDX mainly focusing on the antecedents of Organisational Citizenship Behaviour (OCB)—individual behaviour that is discretionary, not directly or explicitly recognised by the formal reward system, and in the aggregate promotes the effective functioning of the organisation. It’s a unique aspect of individual actions at the workplace that arise from individual aspirations to contribute more than required as well as showing that their behaviour is not tightly linked to the organisation's reward system only. Example of organisational citizenship behaviour varied from helping others with work-related problems, polite manners to prevent work-related problems with other employees, willingness to tolerate less than the ideal situation without filing complaints and active participation in an organisation’s advancement.

In this research, I looked for the effects of a wide range of factors, i.e. job satisfaction, organisational justice, organisational commitment, task feedback, perceived organisation support, supervisory support, as well as transformational and transactional leadership for people to perform those extra-role behaviours. Looking at which factors predict OCB will thus enable organisations to create policies and practices that not only fit the culture but also enable organisations to reach their goals.

So, the following question is, what matters the most?

Affective Commitment—the ‘feels like home’ element

In seeing this factor, we cannot put aside on the fact on the changing nature of career due to the rise of millennials. Their participation in the workforce can be a bit of challenge as they are increasingly become the majority of the workforce and predicted to continue in the following years ahead. As much as they give new opportunities and a bit of fresh air to the organisation, this is still the generation who have been exposed to the success of entrepreneurs under their 30s. Hence, a life-long career in one organisation that focuses on the traditional vertical move is no longer suit the time. Even when they choose professional career track, they still have the tendency to take a lateral move across organisations in a relatively short period, in which referring to a low organisational commitment.

Therefore, an organisation should create policies and perform HR practices focus more specifically in increasing its people’s affective commitment—an individual’s emotional attachment, identification, and involvement in the organisation that drives their membership in the organisation owing to his/her internal desire—instead of the organisational commitment in general. Rather than creating reward programmes that tie employees for a long term such as deferred reward and series of loans, organisations should focus on creating a working environment where employees can feel as if they are at home and identify themselves as part of the big family of one organisation. Becoming part of a family also means having clear alignment between what they do on a day-to-day basis and the organisation vision. Thus, defining shared mission can also help to increase affective commitment, as employees are found to value their job based on how much they actually create an impact on the business, even bigger, to the society.

Moreover, an organisation can implement practices which show their attention for not only employee welfare but also well-being, such as providing flexible working arrangement. When employees perceive that they are valued and respected, they are more likely to reciprocate by acting appropriately and showing positive behaviour towards the organisation, including being committed and behaving positively towards the organisation, in this case, performing an extra-role behaviour. Moreover, it is also important to make employees feel included by involving them in decision-making processes by having polls related to relevant decisions that can impact them and implement annual employee satisfaction surveys instead of focusing solely on performance appraisal.

The importance of Meritocracy—fair process, fair leader, fair decisions

Considering that both distributive and interactional justice show a substantial relation to people’s willingness to perform extra-role behaviours, it is worth noting that besides ensuring that HR policies and practices are perceived as fair and carried out equitably, the way employees are treated during the implementation of policies, which reflects the interpersonal treatment from their managers, also plays an essential role. In essence, first line manager holds a significant role in this matter. They need to firmly understand that the way employees feel about the organisation might be manifested in the form of extra-role behaviours, so it is critically important to create equitable rewards system and deliver fair treatment amongst their team.

In an organisational level, implementing training programmes for managers and supervisors are also help to improve their skills and ability to develop a supportive management technique and fairly distribute rewards can be one of the options to be explored. A platform for leaders in every level to share on how each other work so they reach mutual understanding in how they lead and communicate their team can also be an option.

The Leaders they can look up to

Lastly, the result suggests that the organisation should focus more on cultivating transformational leadership behaviour. The managers and supervisors’ good examples can inspire the employees to perform similarly. Thus, it is suggested the HR department create a comprehensive training programme for managers to build the skills and competencies to become transformational leaders who will be able to articulate a vision, present an appropriate model, emphasise the alignment of group goals, provide intellectual stimulation, and have a high-performance expectation. Their behaviour can cascade down to their subordinate by performing those traits.

At the minimum level, any organisation should not inhibit organisational citizenship behaviour by not allowing their employees to participate in a wider scope than their job description or by focusing on rewards that are linked to organisational outcomes. Taken together, all three major factors suggest the important role of supervisors and managers in determining employees’ OCB. They need to have mutual respect and trust in their subordinates to develop a supportive environment, which can improve employees' affective commitment, make decisions and policies equitably, and behave as a transformational leader.