Determinants influencing productivity in unicorn startups: Roles of new ways of working and work engagement

Abstract

Despite its growth, Indonesia’s startup industry struggles with high failure rates; this industry relies on employee productivity and promoting new work methods that reshape modern workplaces. The study aims to examine the impact of new ways of working on employee productivity and work engagement in Indonesian unicorn startups post-pandemic while also observing the current situation using importance-performance analysis. The data analysis uses structural equation modeling (SEM) with partial least squares (PLS) and Smart-PLS software. This study analyzes survey data from 56 leaders of Indonesian unicorn startups. It delves into the complex relationships between these variables based on the leaders’ perspectives. According to the findings, new ways of working impact employee productivity (β = 0.521; p-value < 0.05), new ways of working impact work engagement (β = 0.856; p-value < 0.05), work engagement impact employee productivity (β = 0.379; p-value < 0.05), and new ways of working impact employee productivity through work engagement (β = 0.325; p-value < 0.05). The findings indicate that new ways of working significantly affect work engagement and productivity. It also identifies work engagement as a key driver of employee productivity. Interestingly, the effect of new ways of working on employee performance is also mediated by work engagement, highlighting the relationship between these factors.