Analysis of Human Resources Competence for Improving Business Performance in The Masaran Sragen Batik Industry Centre

: The research aims to identify and analyse human resource competency variables in order to improve performance in Sragen Regency's batik industry centre, Central Java. The research methods used were quantitative and qualitative data collection techniques through questionnaires, observation, interviews, and documentation. Employees from the Sragen batik industry centre participated in research activities 100 personal. Data analysis procedures included validity testing, reliability tests, confirmatory factor analysis, and connection analysis of human resource competencies in order to improve Batik's business performance. Based on the results of the analysis, the intrinsic variable is the character of competence that a person has which is inherent in motivational factors within a person and the extrinsic is the character of motivational competence from the influence of factors outside of a person's personality and both have an influence on improving the performance of batik businesses.


INTRODUCTION
Batik as a treasure of the archipelago is a historical fact, proving the existence of Indonesian culture.To support the development and preservation of national batik, the government provides regulations: (a) Minister of Home Affairs number 53/2009 on the use of batik in government agencies; (b) Minister of Trade number 86/2015 on the import of textiles, textile products, and motifs to maintain domestic batik production and marketing (Adcharina et al., 2020;Agus et al., 2015).To support regulations for the development of batik enterprises, MSMEs must be prepared and improved by providing various facilities to ensure competitiveness, such as human resource skills.Batik MSMEs must be ready to prepare the quality of competent human resources as a driving force for the continuity of batik business activities.This is to mobilise, maintain, and improve the quality of human resource performance for performance improvement.Decreased employee morale, decreased work productivity, high turnover, decreased work motivation, low employee creativity, undisciplined work hours, and high absenteeism are indications that problems regarding human resources (Suranto et al.,2023).
The portrait of problems that occur for entrepreneurs in the Masaran batik industry centre is 102 MSMEs, out of 170 batik MSMEs.The condition of Masaran batik MSMEs (Adcharina et al., 2021) is currently growing after COVID-19; therefore, a solution is needed and urgently resolved so that employees can return to work normally, work according to targets, increase their productivity, increase sales, and increase production.Several approach strategies are carried out by batik MSMEs through development activities, skills training, and work ethic (Agung, 2012;Astria et al.,2017;Parashakti et al.,2019;Adcharina et al.,2017).In addition to regulations on the use of batik clothing for state civil apparatus, the Sragen district government also provides technical guidance for batik businesses and builds building facilities for training, technical guidance, and marketing activities for spiritual and capacity building and batik centre building.This is carried out so as Sragen batik MSMEs continue to grow and develop, creating superior and capable business actors through knowledge and skills for employees.
MSMEs management should formulate competency criteria that must be owned by batik MSMEs so that they recruit employees with the appropriate knowledge, skills, and behaviour, such as: having participated in specific training, having certification, having incentive standards, having wage standards, having conducted technical guidance, supporting the work climate, having motivation, having skills and knowledge, having a minimum standard of education, and having good worker behaviour (Suranto et al.,2023).
The success of MSMEs does not depend on only employees but also leaders who have a style of leading groups that are able to provide exemplary work (Agus et al., 2019;Algahtany et al.,2018;Liana et al., 2018).Likewise, a cool, conducive organisational climate that is able to generate employee motivation determines the success of the business (Fitriansyah et al., 2023).Prospective employees who have special skills or training in batik also have an influence on improving business continuity because employees have the skills, knowledge, and attitudes that are built in order to improve performance (Rustan et al., 2023).Certification of certain competencies is able to improve the skills and abilities of employees as a measure of the extent to which a person's ability to use their knowledge and abilities (Rustan et al., 2023).Incentives and wages provide separate motivation and enthusiasm for employee performance (Fiitriansyah et al., 2023).
MSMEs management can conduct training for employees as a period of job orientation through technical guidance, which is interpreted as guidance, in order to improve knowledge, skills, attitudes, and behaviour in order to improve performance (Fitriansyah et al., 2023;Suranto et al., 2023).The work climate is interpreted as someone doing work that is expected to be comfortable, productive, and professional.MSMEs can implement a good work climate as a working relationship among employees that is increasingly cool and conducive to work motivation will be able to improve (Liana et al., 2018).Leadership motivation will support the creation of a conducive climate and high work motivation for employees (Neneh & Dzomonda, 2021).
This qualitative and quantitative approach to research was conducted at the Masaran Sragen batik industry centre, which is very urgent in the context of research on improving the quality and competency criteria of human resources (HR).The research target is to provide solutions by making improvements to superior HR competencies so that employees are normally able to carry out work activities (Fitriansyah et al., 2023;Suranto et al., 2023).
Strategies to improve employee performance can be developed through skills, improving knowledge, and being a driver to do work to be more productive and on target (Rustan et al., 2023).The research target is an analysis of human resource competencies for the continuity of batik business performance, so that the advantages of the research are used as evaluation and input for improving batik MSME policies regarding variable HR competency criteria for improving batik business performance (Neneh & Dzomonda, 2021;Adcharina et al., 2020).The results of the analysis are used as improvements in increasing employee work productivity, employee morale, reducing turnover, reducing high absenteeism, and, besides that, as a solution to the problems that occur.
Indonesia's Human Development Index (HDI) in 2023 reached 74.39, an increase of 0.62 points (0.84 percent) compared to the previous year (73.77).During 2020-2023, Indonesia's HDI increased by an average of 0.72 percent per year.The increase in HDI in 2023 occurred in all dimensions, including longevity, healthy living, knowledge, and decent living standards.The growth of HDI 2023 has accelerated from the previous year.All dimensions of HDI have increased, especially decent living standards and knowledge (Badan Pusat Statistik [BPS], 2023).Therefore, HR in MSMEs must be ready to compete in the global arena, at least having standardisation for HR needs.The variables studied are HR characteristics (both intrinsic and extrinsic) and business performance.(Suranto et al., 2023;Arif & Zulfikar, 2020;Kristiana & Desnormasari, 2018;Rahmita et al., 2020).
In order for Indonesians to benefit equitably from the demographic dividend, the government needs to ensure that certain enabling conditions and policies are in place and operating effectively (Kristiana & Desnormasari, 2018;Marihot, 2021).Indonesia is still in the period to enjoy the demographic bonus.If it can be utilised optimally, then Indonesia can accelerate economic growth and improve people's welfare (Rahmita et al., 2020;Marihot, 2021).The quality of Indonesia's workforce is arguably weak.This is because of the number of workers in Indonesia in February 2020, which reached 137.91 million people; the working population was only 131.03 million people.The structure of the labour force is still dominated by people with low levels of education (elementary school and below), which causes the value of the industry to be weak (Marihot, 2021;Sita et al., 2018).
Human resources in batik MSMEs must have certain competency standards, which are the ability of individuals to carry out a job correctly and have excellence based on matters relating to knowledge, expertise, and attitude (Suranto et al., 2023;Rustan et al., 2023).Competence is an ability or proficiency that describes a person's qualifications or abilities, both qualitative and quantitative, from knowledge, skills, and cognitive, affective, and psychomotor behaviours at their best (Suranto et al., 2023;Nawawi, 2006).
In addition to specific training competencies, special certifications to support the quality of human resources are also considered.Certification and knowledge of production, marketing, managerial, affective, cognitive, and psychomotor knowledge of work effectiveness will generate positive characteristics such as creativity, participation, deepening knowledge, discipline, responsibility, commitment, work enthusiasm, and work motivation.Sufficient knowledge will improve work performance, productivity, work discipline, low absenteeism, minimal production damage, low work errors, low accident rates, being imaginative and capable at work, minimal waste of raw materials and production time, easy practice according to production operation standards, making the right decisions, and the spirit of initiative (Sita et al., 2018;Nawawi, 2006;Robbins & Timmoty, 2018;Suranto et al., 2023) Employees who have received technical guidance on work systems, production systems, and marketing systems will have special knowledge, experience, and skills.Technical guidance for small entrepreneurs, especially in business management, is carried out so that the products produced can be in accordance with what the community needs, and the business can be managed effectively and efficiently by applying good management functions and business functions (Nawawi, 2006;Robbins & Timothy, 2018) .Meanwhile, the intrinsic and extrinsic motivation of employees will foster innovation in producing goods and services and develop various ideas and new business ideas for MSMEs (Suranto et al., 2023;Robbins & Timothy, 2018).Skills as practical activities are defined as the implications of activity; skills are behaviours that are acquired through stages of learning, derived from movements, through the process of coordination and integration for a specific purpose (Nawawi, 2006).To improve performance, knowledge and skills in production, marketing, management, and finance can improve performance and develop the individual abilities required to complete job tasks (Robbins & Timothy, 2018).Behaviour is a variable that contains a person's personal characteristics in daily activities (Suranto et al., 2023;Robert & John, 2021;Nuzulul, 2022).
Characterised by financial resources being a challenge for many MSMEs, participants recognised the importance of offering competitive compensation packages and non-monetary benefits to attract and retain talent.Some MSMEs implemented performance-based incentives, profit-sharing schemes, and flexible compensation structures to motivate employees and reward outstanding performance (Nuzulul, 2022).Therefore, the implementation of career development programmes such as education and training, promotion, or mutation will provide an opportunity for each employee to understand more about the work they do (Pratiwi & Hartono, 2021).
Marketing performance is a measure of achievement obtained from the overall marketing process activities of a company or organisation.There are three indicators used to measure marketing performance in this research (Agusty, 2002) sales volume, or the number of product sales successfully achieved by the company.The second was customer growth, which was successfully achieved by the company.The third was the amount of product sales profit successfully obtained by the company (Agusty, 2005).
Therefore, improving the quality of human resources for organisations is very important as a potential driver of all organisational activities to achieve goals.One of the ways that organisations do this is by paying attention to the maximum needs of employees.Employee performance is influenced by many factors, including motivation, training, skills, and so on.The planned research is urgent to do for the Masaran batik industry centre in order that the results of the formulation of criteria and competencies for human resources become superior in the batik business (Suranto et al.,2023).This research has a novelty in formulating of HR competency criteria for performance improvement that is: (a) flexible, which can be applied to batik or similar MSMEs; (b) applicable, which can be applied to batik or similar MSMEs; and (c) visible, which is the HR criteria needed for batik MSMEs.

Study Aim and Hypothesis
The purpose of this research is the identification, analysis, and development of employee competencies needed to improve business performance in the Sragen batik industry centre.Hypotheses were developed and formulated as a goodness of fit model (feasible and good) for an increase in business performance in batik.

Design
The research design uses a sequential explanatory model.It is a mixed method that combines qualitative and quantitative research methods sequentially and supports each other, where the first stage is carried out with a qualitative method approach and the second stage is carried out with a quantitative method (Adcharina et al.,2020).Qualitative and empirical inquiry studies examine phenomena in the context of real life for batik entrepreneurs and utilise sources, including informants.

Extrinsic Human Resources
Quantitative analysis will examine the correlation between variables to find and explain a relationship and method implementation.The results of the research are used as a model formulation for batik business development.The research framework is in accordance with Figure 1, and the hypothesis developed is that the intrinsic and extrinsic HR variables, which have their respective manifest indicators, are expected to affect the performance of MSMEs.
Based on the concept that has been explained regarding the influence of intrinsic and extrinsic characteristics, they are expected to influence each other.Intrinsic indicators consist of 7 manifest variables with codes I-1 to I-7, and extrinsic indicators consist of 5 manifest variables with codes E-1 to E-5, and performance with codes p-1 to p-4.Whether intrinsic and extrinsic variables affect business performance, this model structure can be described in Figure 2:

Participants
Respondents in this research were employees of the Sragen batik industry centre.The sampling technique is random, with a total of 100 employees working at the Sragen batik centre, both questionnaires and interviews to provide input on HR criteria according to the views of HR (employees).

Instruments
The data collection technique in this research used a questionnaire, carried out using several question instruments.Before being used as a test tool, a reliability test was carried out on all scales to be used.Reliability and validity tests use Cronbach's alpha standards (Adcharina et al.,2020).The next step is to try out the questionnaire items on 30 respondents to determine their validity and reliability.Furthermore, valid and reliable questionnaire items were filled out by 100 respondents.Each variable has a number of sub-variables in the form of items.The training variable has 6 questions, certification has 6 questions, incentive standards have 8 questions, wage standards have 6 questions, technical guidance has 4 questions, work climate has 6 questions, work motivation has 6 questions, knowledge skills have 6 questions, and education has 6 questions.Then, the GOF model analysis is carried out by looking at the standardised criteria in Table 1.

Data Analysis
Based on the analysis of the validity and reliability of the questionnaire, all variables are declared to be valid and reliable in Table 2; the alpha validity value exceeds 0.3 (Dyah & Agustinus, 2018), (Soegiyono, 2016) and reliability exceeds 0.7.In the path analysis of the MSME performance improvement model variables, items that have a positive correlation with the criterion (total score) and a high correlation indicate that the item has high validity as well.The minimum requirement to be considered eligible is r > 0.3; thus, all items are valid.In table 2, it is known that the question items used to measure the intrinsic, extrinsic, MSMEs performance variables of MSMEs are declared valid, with the Cronbach's alpha coefficient > 0.7 and the Cronbach alpha coefficient values of variable X1 of 0.871, X2 of 0.835, and variable Y of 0.874> 0.70.In Table 3, it is known that the question items used to measure the variables of instrinsic, extrinsic, performance of MSMEs are declared reliable; the Cronbach's alpha coefficient is > 0.7.Based on the analysis, the results obtained show that the relationship between indicators (manifest variables) and latent variables can be presented in Table 4.In Table 4, it is known that the loading of each indicator on its variable is > 0.5 with a significance of < 0.05 (5%).This means that all indicators are significant in measuring latent variables, so the structural analysis continues with the structural hypothesis.Both intrinsic and extrinsic variables have a great influence on improving the performance of MSMEs.Furthermore, when conducting path analysis, the results of the coefficient of direct influence of exogenous variables on endogenous variables can be seen in Table 4.To analyse the significance of the causality relationship among latent variables, it can be seen from the CR value or based on the p-value as shown in Table 5.  namely: (1) The knowledge variable has a significant effect on the intrinsic to extrinsic variable with a path of 0.663, a CR value (6.990) > the critical Z (1.96), and a significance level of 0.000 <0.05; (2) The behaviour variable has a significant effect on the intrinsic to performance variable with a path coefficient of 0.793, a CR value (9.016) > the critical Z (1.96), and a significance level of 0.000 <0.05; (3) The knowledge variable has a significant effect on the extrinsic to performance variable with a path coefficient of 0.594, a CR value (5.000) > the critical Z (1.96), and a significance level of 0.000 <0.05.
Based on Table 5, it is known that intrinsic, extrinsic variables have a direct influence on the performance of MSMEs.Based on path analysis by connecting the variables of the relationship between intrinsic, extrinsic to MSMEs performance, the three of them have a very strong relationship, influence, interaction, and connection.

Results
Based on the hypothesis (structural model) developed, the concept of HR competency criteria will affect the performance of MSMEs.The data needed in the research are primary and secondary data, as follows: (1) Make observations to find out the problems that exist in the field about: (a) description and condition of batik entrepreneurs; (b) mapping the selection of tenants in Masaran batik centre; (2) interview activities to find out: (a) problems encountered by batik entrepreneurs in continuing their business; (b) problems to improve competitiveness.Secondary data needed is documentation data on the history of batik, the amount of production, the amount of marketing, the number of workers, the behaviour of batik MSME entrepreneurs, and the demographic map of the Masaran Sragen area (Adcharina et al., 2023;Suranto et al.,2023).
Sub-variables of intrinsic HR characteristics: (a) training, (b) certification, (c) technical guidance, (d) self-motivation, (e) skills and knowledge, (f) minimum standards, and (g) worker behaviour is able to interpret intrinsic variables.Extrinsic HR sub-variables (a) wage standards, (b) bonuses or incentives, (c) career opportunities, (d) MSME work climate, and (e) employee maintenance is able to interpret extrinsic variables.For the business performance sub-variable with indicators (a) sales increase, (b) production increases, (c) consumers increase, and (d) profits increase, be able to interpret the business performance variable (Suranto et al., 2023) Based on the analysis results, all questionnaire items are declared to be valid and reliable for the three latent variables.Each latent variable has indicators or manifests to interpret the latent variable.Based on CFA analysis, intrinsic variables have a greater influence than extrinsic variables in improving the performance of MSMEs.Therefore, a strategy is needed to improve performance.The strategies implemented: (a) employees are evaluated according to work so that the right employees are produced; (b) the right placement of employees both in production, such as dye making, releasing production, fabric heating, stamping, drying, and packing, can be well considered; (b) knowledge and skills of marketing, management, and skill improvement towards work are well considered by managers, management, and employees (Suranto et al., 2023).
Strategies undertaken to improve competence by improving production work, marketing, communication, understanding product quality, and skills in running batik cloth production.Through

Limitations and Further Research
The research was only conducted at the Sragen batik centre; in the future, several other batik MSMEs can be sampled.Improving employee performance is not only in the aspects of training, competency certification, incentives and wages, technical guidance, work climate, leadership motivation, and career development (employee performance), but also in other variables that have not been studied.Suggestions for future research: many MSMEs and more employees should be used as research samples in the research.

CONCLUSION
Based on the results and discussion, it is concluded that the formulation of the HR competency indicator is declared to be goodness of fit, and the formulated model can be applied in the context of improving the performance of MSMEs.
The intrinsic characteristics of HR expected by batik MSMEs include: (a) training; (b) certification; (c) technical guidance; (d) self-motivation; (e) skills and knowledge; (f) minimum standards; and (g) worker behaviour.While the characteristics of extrinsic HR are (a) wage standards, (b) bonuses or incentives, (c) career path opportunities, (d) MSME work climate, and (e) employee maintenance, MSME performance variables have indicators: (a) sales increase, (b) production increases, (c) consumers increase, and (d) profits increase

Table 5 .
CR Value and p-Value of Causality Relationship among Variables on Model Fit