Exploring the Relationship of Competency, Management Best Practices, and Employee Performance in a Palm Oil Mill Company

Abstract

In managing human resources, management is required to find appropriate competency development. The
employees need to know what competency indicators they have and should have. It needs to be done to encourage
the best practices provided by management to improve employee performance. The research aimed to identify the
competency of human resources and management best practices related to advancing employee performance in a
palm oil mill company. The research applied a quantitative approach. The studied company was Talopino palm oil
mill unit in Seluma Regency, Bengkulu, owned by PT Perkebunan Nusantara VII Lampung (PTPN VII Lampung).
The research was conducted from July to November 2019. The used data were primary and secondary data.
Primary data were obtained by interviews and questionnaires with 76 employees in the company. The indicators
were adapted from several previous researchers. The research analyzed the data using the Likert scale and Partial
Least Square Structural Equation Modeling (PLS-SEM). The result shows three implications. First, competency
affects employee performance in the palm oil mill company. Second, competency has an insignificant result on
management best practices. Third, management best practices affect employee performance. The research can
provide information to companies in enhancing the employees’ competency with strategic steps in the era of
globalization.