Search

An increasingly complex and competitive organization environment, demanding every organization to be more responsive in order to survive and grow. Extrinsic motivation, compensation, transformational leadership is some of factors which is can give impact to the employee innovation behavior. The object for this study is PT. Idefta Nusantara. Population and samples in this study is the employees of PT. Idefta Nusantara. The data used in this research is the data collected from the questionnaire method, which has provided a list of questions by researchers. The data will be processed by path analysis method, using the validity and reliability test and classic assumption test with SPSS version 22. The results of this study show the hypothesis can prove that the role of transformational leadership and compensation can give effect to innovation behavior through extrinsic motivation as intervening variable; it can be measured by comparing the value of transformational leadership (X1) and compensation (X2) on innovation behavior (Y) directly with the value of its total influence. If the total influence value of each exogenous variable is bigger than its direct influence on the endogenous variable, then the extrinsic motivation can be identified as the intervening variable. Based on the analysis, direct influence of transformational leadership (X1) is 0.231 and compensation (X2) is 0.158. While total influence of transformational leadership (X1) to innovation behavior (Y) is 0,112 + 0,330 = 0,442 and influence of compensation (X2) to innovation behavior (Y) is 0,590 + 0,330 = 0,920. From the calculation result showed that the total influence of transformational leadership (X1) and compensation (X2) variables is bigger than the direct influence to the two exogenous variables on innovation behavior (Y). These results indicated that extrinsic motivation (X3) can be an intervening variable between innovation behavior (Y) with transformational leadership (X1) and compensation (X2). This paper would help leaders in this sector to develop a better understanding.