Determining Leadership Styles to Support Civil Servant Relocation: A Case Study of Indonesia's New Capital Plan

Abstract

This study intends to investigate the impact of leadership style on civil servants' (in 4 ministries representatives of the Indonesian government) readiness to change and relocate to the future capital of Indonesia (Ibu Kota Nusantara / IKN). The quantitative approach was used from the data survey from 62 high-level civil servant representatives using a questionnaire. The collected data was analyzed using the SPSS software and exploratory factor analysis (EFA). The findings also indicated that, out of the 12 indicators of leadership style measured in this study, persuasion and integration leadership style should be considered crucial and important factors in shaping supportive behavior in the context of readiness for change. Making the relocation process successful requires avoiding the type of initiation structure leadership style. The finding of this study reveals that to choose the best leaders, the Indonesian government is urged to use these two criteria (persuasion and integration leadership style), especially for those in charge of facilitating the relocation process to IKN. Additionally, to demonstrate their confidence and make full use of their resources, leaders who are in command must be able to anticipate that the relocation of civil servants would go smoothly with less risk.

1. Introduction

In most instances, particularly in developed countries, a high degree of bureaucracy determines the culture of government officials; one such nation is Indonesia (Rauch & Evans, 2000). Since public servants are not prepared for the change process, many HR programs constantly fail to produce the desired results (Yean et al., 2022). The relocation program either fails because it is not in line with the organization’s objectives or is just viewed as lip service, especially in industrialized countries confronting issues (2005; Nasi, 2011). In the instance of Indonesia, many public entities, particularly at the ministry level, have demonstrated success in adopting many HPWS-based settings since the reformation era in 1998. (Ali et al., 2017). Therefore, any effective HR program should not face resistance to change from civil authorities. The Indonesian president announced in 2022 that Indonesia would have a new capital in Borneo by the year 2024. Called Ibukota Nusantara (IKN), which translates to “New Indonesia Capital,” the civil servants, particularly those working at the ministry level, are expressing their opposition through various responses and nonsocial media. However, as mentioned before that the culture of civil servants is created, therefore positive initiatives such as relocation to new places would not be a big problem for those who are ready to serve their country. This relocation plan undoubtedly has advantages and disadvantages, one of which is related to civil servants’ readiness for the changes they will encounter. Employees’ willingness for change and the appropriate leadership model are the main determinants of how well they work after being relocated. Civil servants’ performance may suffer from a lack of adaptability to change and inflexible leadership traits. The organizational changes from the old to the new environmental adaption system are affected by the fall in civil servant post-relocation performance because organizational change is a change that may not generate the desired results and does not promote a sustainable transformation.

The success of reforms and relocation has been greatly influenced by people’s capacity for change (Armenakis et al., 1993). Two behaviors—both positive and negative—that appear when improvements are made serve as indicators of this. Positive conduct is characterized by an ability to adapt, and negative behavior is characterized by a drive to resist change. Positive behavior among employees can help them become more change-ready, enabling change to achieve the desired results (Kamar et al., 2020; Novitasari et al., 2020). Empirical studies found that one of the important factors in determining the success of relocation is leadership style (Aardenne, 2011). It is assumed that the right leadership style will enhance the readiness to change individuals in receiving a relocation decision. In the Western world, transformational leadership creates a positive climate in the HR relocation program (Krishnan & Scullion, 2017). According to numerous research, transformational leadership significantly affects worker productivity through the variable of readiness to change (Hutajulu et al., 2021; Katsaros et al., 2020; Martono et al., 2020). According to several findings, transformational leadership has a considerable impact on employee productivity as well as readiness to change (Astuti & Khoirunnisa, 2018; Kamar et al., 2020; Novitasari et al., 2020). Models of the relationship between the factors mediating change preparedness and the relationship between transformational leadership and employee productivity are provided by several studies. Indonesian leadership has a distinct style that sets it apart from other Asian and Western leadership practices in general (Irawanto et al., 2011). According to GLOBE Project (Global Leadership and Organizational Behavior Effectiveness), Indonesian workers anticipate that their leaders will look out for them personally and demonstrate this approach in a very charismatic manner. Followers must be led by leaders who are visionary, inspiring, performance-oriented, and collaborative since these traits are highly valued. The LBDQ-XII is the only non-experimental questionnaire created to analyze desired leader behavior utilizing a sample base in a variety of global cultures that is valid, trustworthy, and published by a skilled team (Minelgaite & Littrell, 2018) and consists of 12 indications, namely representation, demand reconciliation, tolerance of uncertainty, persuasiveness, initial of structure, tolerance and freedom, role assumption, consideration, production emphasis, predictive accuracy, integration, and superior orientation.

Without a doubt, the employee will negatively respond to this relocation plan in Indonesia due to the high level of uncertainty present there, especially in a new site. The likelihood that the public sector workers will accept the change will increase with their support and the appropriate degree of leadership style. As a result, this study will investigate whether 12 LBDQ XII factors are required to facilitate the readiness for change when moving to the new Indonesian capital. The National Planning Bureau has designated four ministry organizations as the top priority in the 2024 relocation program, and these organizations make up the study’s sample.

2. Literature Review

2.1. Indonesia Leadership Style Based on GLOBE Project

Leadership is viewed as an interdependent relationship between leaders and followers that shapes how each party behaves in regard to the other. This relationship-based perspective explains why a leader’s actions may be recognized and valued in one cultural context but may be misconstrued by another set of cultural values (House et al., 2004). The concept of effective leadership is needed (Nurani et al., 2021) in responding to the challenges of the new capital relocation process for Indonesian civil servants. GLOBE (Global Leadership and Organizational Behavior Effectiveness), which is used in 67 nations worldwide, is one of the concepts of global leadership. The standard and foundation for study on all facets of global leadership in the context of human resource development continue to be GLOBE. Managers demonstrate a higher level of readiness to embrace and use a charismatic leadership style that is counterbalanced by a particularly strong humane orientation (Irawanto, 2009). According to GLOBE’s research, followers in Indonesia expect their leaders to show them individual, compassionate attention and to convey this approach in a highly captivating way. In the discourse on the development of strategic and effective leadership theory, Irawanto et al. (2012) in-depth examined paternal leadership models that are valuable for effective implementation in Indonesia. It is hoped that the development of leadership theory will continue to be expanded, especially during the relocation process of Indonesia’s new capital. GLOBE projects have 12 indications, namely representation, demand reconciliation, tolerance of uncertainty, persuasiveness, initial structure, tolerance and freedom, role assumption, consideration, production emphasis, predictive accuracy, integration, and superior orientation.

Representation measures the extent to which the leader positions himself as a representative of the group. Demand reconciliation reflects how well the leader can dampen various demands and reduce the chaos that occurs. Tolerance of uncertainty describes the extent to which leaders can tolerate uncertainty. Persuasiveness measures the extent to which leaders use persuasion and arguments effectively to demonstrate strong convictions. Initiation of the structure measures the extent to which leaders clearly define their own roles. Tolerance of freedom reflects the extent to which the leader allows scope for subordinates to take initiatives, decisions, and actions. Role assumption measures the extent to which the leader carries out a leadership role actively rather than handing over leadership to others. Consideration describes the extent to which the leader values the comfort, welfare, status, and contribution of his subordinates. Production emphasis measures the extent to which leaders apply pressure or power to obtain productive results. Predictive accuracy measures the extent to which leaders demonstrate foresight and the ability to predict outcomes accurately. Integration reflects the extent to which leaders maintain tight-knit organizations and resolve conflicts among members. Superior orientation is the degree to which the leader maintains good relations with superiors, has influence with them and strives for higher status (House et al., 2004).

2.2 Leadership and Readiness to Change

To keep up with the changing and complex business environment of today, organizational transformation has become a crucial component of the organizational life cycle. Organizations must change to respond to internal and/or external changes, but putting changes into practice can be challenging. Up to 70% of all big change projects fail, according to research (Cartwright & Schoenberg, 2006; Katsaros et al., 2020). As a result, it is claimed that change is so difficult to achieve that doing so successfully requires a miracle. The ability of a company’s personnel to adapt is crucial to its success or even survival in this constantly changing environment (Katsaros et al., 2020; Nadkarni & Herrmann, 2010). To sustain a competitive advantage, they must be open to change and flexible, especially since civil servants will be transferred to IKN as a human resource asset. Few studies have examined the function of leadership in enhancing employee readiness for change, despite several studies looking at the influence of organizational characteristics, capabilities, and resources on employee change readiness. Similarly to this, numerous studies have examined how willingness to change affects the link between transformational leadership and employee job performance (Katsaros et al., 2020; Yukl, 2010). Performance is a goal-oriented system that makes sure all organizational procedures are in place to maximize employee, team, and overall organizational efficiency (Armstrong, 2000). As a result, management must take practical and well-considered action to rescue the company from the crisis quagmire that nearly sank some weaker portions of the organization.

Individual readiness for change is seen in empirical data as a crucial need for managing fruitful change (Weiner, 2009). Individual readiness for change is described as beliefs, intentions, attitudes, and behaviors to respond to change and is the potential to achieve change successfully (Weiner, 2009). This behavior shows the acceptance or rejection of change (Bernerth, 2004) and the effectiveness of beginning change (Armenakis & Harris, 2009). Individual openness to change can therefore be seen as a key component in the success of moving the capital from Jakarta to IKN. Individuals’ level of change readiness can be seen in their decision to support, simply implement, or outright reject a change when it occurs (Holt et al., 2007). This can only happen if employees have faith in the managementset change objectives and the capability of organizational elements to keep up with change (Holt et al., 2007), including the capability of employees and organizational leaders to lead the implementation of change. According to experts, when employees are highly adaptable, they will make more change-related efforts and exhibit higher tenacity in the face of challenges, all of which eventually help to improve the success of change implementation (Abdel-Ghany, 2014). Therefore, the leadership element is crucial in guiding civil servants to ensure that they can function effectively despite the challenging aspects of the changes they encounter.

3. Research Methods

This study adopts a quantitative approach by surveying respondents from 4 different ministries that prioritized relocation to the new capital of Indonesia in 2024. Data collection was carried out by researchers through the distribution of online questionnaires to 100 respondents using purposive sampling of high-level civil service representatives, and 62 valid answers were analyzed. The leadership style based on the GLOBE project using LBDQ-XII (Leadership Behavior Description Questionnaire XII version) by Ohio State University (House et al., 1999) consisted of 100 items. Readiness to change based on Hanpachern et al. (1998) consists of 3 indicators (resisting, promoting, and participating) using 14 items Likert scale. Data analysis methods using descriptive statistics and Exploratory Factor Analysis (EFA).

4. Results and Discussion

Table 1 shows that 58% of respondents are men and the remaining respondents are women. 32% of respondents were in the 36−40 age range, and 45% were beyond the age of 41. In this data set, we can conclude that generation X is more prevalent than generation Y. A master’s degree was held by 27.5% of respondents, while 45% of respondents had an undergraduate degree as their highest level of education. 67% of the respondents in this survey were structural officials, with the remaining respondents being at the level of functional officials. This is because, based on the characteristics of the respondents, they are generation X, who has had a long working period compared to generation Y, so they certainly occupy high positions. The factor loading value of a measurement item is used in factor analysis to determine the validity of the item. Items with a loading factor of greater than 0.5 are considered to be valid. According to Hair et al. (2014), items with low validity (loading factor 0.5) should be removed from the measurement model to ensure that only items with high validity are used to compute the factor score for each variable. Table 2 and Figure 2 report the findings of the loading factor test on the measuring items for 12 categories of leadership. After all measurement items are confirmed to be valid, then an evaluation of the reliability of the research instrument is carried out on 12 types of leadership. Reliability evaluation is done by looking at the composite reliability value. Variables are declared to have reliable research instruments if the variable’s composite reliability value is more than 0.7.

Figure 1: Research Model

Table 1: Respondent Demography

Table 2: EFA Results

Figure 2: Visualization of Testing Results of the Effect of Dominant Leadership on Supporting

Based on the results of the factor analysis in Table 2, the loading factor values for each type of leadership are obtained. The loading factor value indicates the role of each type of leadership on the overall leadership of the research respondents. A high loading factor indicates the dominance of this type of leadership compared to other types of leadership. The results of the factor analysis show that the three types of leadership with the highest loading factors are the initiation of structure (0.904), persuasion (0.896), and integration (0.867). Thus it can be concluded that the types of leadership that dominate the research respondents are the initiation of structure, persuasion, and integration leadership types.

The Kaiser-Meyer-Olkin (KMO) test measures how data is suited for factor analysis. The test measures sampling adequacy for each variable in the model and the complete model. For Bartlett’s test of sphericity, if it is significant <5%, it means that the sample is sufficient and spread. The result of the KMO test can be seen in Table 3 and Table 4.

Table 3: Results of The Kaiser-Meyer-Olkin (KMO) Test of Leadership Style

Table 4: Results of The Kaiser-Meyer-Olkin (KMO) Test of Readiness to Change

The effect of persuasion, structure, and integration on readiness to change is analyzed using path analysis with the maximum likelihood estimation method, the software used is AMOS 24.0. The magnitude of the effect is obtained from the standardized path coefficient, while the significance of the effect is seen from the p-value of the test results. P-value < 5% indicates a significant influence of the independent variable on the dependent. The results of the analysis of the readiness to change indicator factor show that supporting has the highest loading factor value (0.925) compared to other indicators, so it can be concluded that supporting is the most dominant indicator in readiness to change. After the factor analysis was carried out and the scores for the dominant factors were obtained, the influence of structure, persuasion, and integration leadership was tested on supporting as a dominant indicator of readiness to change and on readiness to change as a whole. The results of testing the influence of structure leadership, persuasion, and integration on supporting are visualized in Figure 2 and Figure 3.

Figure 3: Visualization of the Results of Testing the Effect of Dominant Leadership on Readiness to change

Figure 2 shows a visualization of the dominant leadership influence on support. The number on the arrow shows the standardized β coefficient, which represents the magnitude of the influence of the type of leadership on support. Table 5 shows in detail the value of the β coefficient and the p-value of the test results. A p-value lower than the degree of research error (α = 5%) indicates a significant influence of leadership on support. Table 5 shows the β coefficient on the influence of persuasion on support is 0.293 with a p-value of 0.011, indicating a positive and significant influence. Based on the test results, it was found that persuasion leadership plays a role in increasing attitudes to support changes in the framework of welcoming the relocation of civil servants to the IKN. Similar results were also found in the influence of integration leadership on supporting indicators where the β coefficient was 0.298, and the p-value was 0.010. The results of testing the influence of integration leadership on supporting indicators show that integration leadership plays a positive role in shaping attitudes to support the relocation of civil servants to the IKN. Different results are shown in the initiation to structure leadership where the β coefficient is 0.085 and the p-value is 0.461 which indicates that there is no significant effect of the initiation to structure leadership on the attitude of civil servants’ support towards change. After testing the influence of the three dominant leadership styles on the supporting indicators, we test the influence of the three dominant leadership styles on the overall readiness to change.

Table 5: Results of Testing the Effect of Dominant Leadership on Supporting

Based on the test results in Table 6, it was found that results were similar to the results of testing on the supporting indicators where persuasion leadership (β = 0.322, p-value = 0.002) and integration (β = 0.03, p-value = 0.977) played a significant role in bringing about readiness to good change to the relocation of civil servants to the IKN. Initiation to structure in Table 6 was also found to have no significant effect (β = 0.003, p-value = 0.977) on civil servants’ readiness to change in their relocation to the IKN.

Table 6: Results of Testing the Effect of Dominant Leadership on Readiness to Change

Persuasive leadership plays a significant role in increasing attitudes to support changes in the framework of relocation of civil servants to IKN. In preparing civil servants to be ready for change and supporting the IKN relocation program, leadership is needed that can use persuasion and arguments effectively with high confidence. A leader needs to take persuasive steps and have the ability to communicate actively and be able to inspire to carry out organizational goals properly. Although civil servants are indeed obliged to obey and follow all decisions made, some have concerns related to the inadequate readiness of IKN infrastructure. Therefore, the leader’s role is not only in persuading and giving orders but also setting an example to subordinates as well as being a key factor in the process of relocating civil servants to IKN.

Leadership in integration has a positive influence on how supportive public servants are of changes necessary for relocation to IKN. Leadership with the ability to always try to resolve conflicts is required to support the IKN relocation program and to get civil servants ready for change. A leader must be able to foster and maintain harmony while bridging gaps between group members and within an organization’s workforce. Although, in general, developing an integration is not an easy thing to achieve, a leader should be able to do it within the context of an organization. Additionally, the relocation planning process that will start in 2024 also raises various concerns for employees. So that leaders must be able to consider various possibilities and make decisions wisely.

The leadership of the program has no discernible impact on the support for change among civil servants in terms of attitude. Civil servants truly do not want a leader who is meticulous and follows the task’s direction as they prepare to relocate. To effectively perform company operations, executives must establish precise work standards. This is related to the initiative of structural factors. In particular, a procedure has been set up so that the initial relocation process, resources, infrastructure, internet, and numerous needs may be properly handled when moving civil servants to IKN. In addition, the determination and planning mechanisms have also been created and allocated, so that the work and operational standards that must be followed have been determined.

5. Conclusion

It is concluded that during this phase of preparation, the leaders who are responsible for facilitating the socialization of the relocation process must have the ability to lead through positive persuasion, as it is crucial to get the civil servants on board with the relocation process and ready for change. Additionally, to demonstrate their confidence and make full use of their resources, leaders who are in command must be able to anticipate that the relocation of civil servants would go smoothly. The results also demonstrated that to complete the relocation process, the initiation structure leadership style should be avoided. Having looked at these positive signs, the results showed that basically among 12 LBDQ XII factors, persuasion and integration style are to be found important in making the supportive behavior in the readiness change perspectives. Therefore, it is advised that the Indonesian government select the right leaders with these two criteria, especially for those who are responsible for making smooth the relocation process.