The Determinants of the Business Performance of Bank Muamalat Indonesia in the Sumatera Utara Business Region

DOI

10.2991/icoi-19.2019.28How to use a DOI?

Keywords

Islamic Bank, Market Orientation, Competitive Advantage, Business Performance,Conventional Bank

Abstract

Islamic banking is a financial institution that offer the management of transactions and financial needs based on the universival Islamic priciples. Particularly in Indonesia, with predominantly moslem population, Islamic banking is expected to grow rapidly, just like in several neighboring countries, namely Malaysia, Brunei Darussalam, Dubai, Qatar, and several European countries that have implemented the Islamic principles in their banking transaction. However, for almost 26 years since the first Islamic bank, Bank Muamalat, began its operation in 1992, it has yet to show any significant business growth compared with conventional banking. This condition encourages the researcher to conduct a study on improving the performance of Islamic banking business, in particular Bank Muamalat, by examining market orientation variable and competitive advantage variable as the influencing factors. The study is conducted on 10 (ten) branches of Bank Muamalat in Medan by selecting the marketing employees and customer relation services, at both manager and staff level as population. The respondent sample are 100 people. By applying Partial Least Squares - Structural Equation Model (PLS-SEM) through path analysis method using SmartPLS V.3.2.8, a conclusion can be drawn that there is a positive and significant influence on direct market orientation test on competitive advantage, and a direct influence from market orientation on the performance of Bank Muamalat displays a positive and significant influence. Moreover, for the indirect test result of market orientation on business performance of Bank Muamalat through competitive advantage also exhibits a positive and significant influence

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Ade Pranajaya
AU  - Endang Sulistya Rini
AU  - Isfenti Sadalia
PY  - 2019/10
DA  - 2019/10
TI  - The Determinants of the Business Performance of Bank Muamalat Indonesia in the Sumatera Utara Business Region
BT  - Proceedings of the 2019 International Conference on Organizational Innovation (ICOI 2019)
PB  - Atlantis Press
SP  - 157
EP  - 162
SN  - 2352-5428
UR  - https://doi.org/10.2991/icoi-19.2019.28
DO  - 10.2991/icoi-19.2019.28
ID  - Pranajaya2019/10
ER  -