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Journal of Economics, Management, Entrepreneurship, and Business Abnus Publisher

The Effect of Performance Measurement System and Trust to Management on Individual Loyalty

2026-05-29
Published
14-27
Pages
OPEN
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MM
Maryani Maryani
Faculty of Economics and Business, University of Lampung, Indonesia
RG
Rindu Rika Gamayuni
Accounting Department , University of Lampung, Indonesia
FD
Fajar Gustiawaty Dewi
Accounting Department, University of Lampung, Indonesia
Abstract

Purpose: This study examines how performance measurement systems (PMS) influence employee loyalty, both directly and through the mediating role of trust in managers, within the banking sector. Although prior research has extensively documented the link between PMS and organizational outcomes, limited attention has been given to how PMS shapes relational dynamics—particularly trust and loyalty—among lower-level banking employees, a gap this study seeks to address.

Research Methodology: Data were collected through a survey distributed via Google Forms to banking sector employees, yielding 105 valid responses. The data were analyzed using SmartPLS to test the proposed direct and mediated relationships.

Results: The findings show that PMS significantly enhances employee loyalty, both directly and indirectly through its positive effect on trust in managers. This suggests that well-designed PMS shape employee behavior through performance accountability while also strengthening the relational foundation between employees and management, thereby reinforcing loyalty.

Conclusions: The results indicate that performance measurement systems serve not only as mechanisms for evaluating employee performance but also as strategic tools for fostering trust in managers, which ultimately strengthens employee loyalty within banking organizations.

Limitations: The study's findings are limited by its sample scope, and future research should test these relationships across broader occupational and sectoral contexts.

Contributions: This study extends management accounting literature by identifying trust in managers as a mediator between performance measurement systems and employee loyalty. The findings also emphasize the importance of transparent and fair PMS in strengthening employee trust and loyalty.

Banking Industry Employee Loyalty Performance Measurement System Trust in Managers
How to Cite
Maryani, M., Gamayuni, R. R., & Dewi, F. G. (2026). The Effect of Performance Measurement System and Trust to Management on Individual Loyalty. Journal of Economics, Management, Entrepreneurship, and Business, 6(1), 14-27. https://doi.org/10.52909/jemeb.v6i1.301
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How to Cite

Maryani, M., Gamayuni, R. R., & Dewi, F. G. (2026). The Effect of Performance Measurement System and Trust to Management on Individual Loyalty. Journal of Economics, Management, Entrepreneurship, and Business, 6(1), 14-27. https://doi.org/10.52909/jemeb.v6i1.301
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