HARMONI as a Performance Appraisal of Village Credit Institution on Bali, Indonesia

Village Credit Institutions (LPDs) in Bali are non-bank financial institutions which performance appraisal is unsuitable for the spirit of its formation and activities that are based on Tri Hita Karana (THK) culture. This research is aimed to reconstruct the LPD performance appraisal with the cultural perspective of THK for community aspect (pawongan) dimension. To achieve this objective, the researchers employed critical theory methodology by means of Habermas ’Theory of Communicative Action (HTCA). A case study was employed as the research strategy, and the data were obtained by interviews, documentary studies, and observations. HTCA was employed to analyze the occurrence of appraisal dominance of LPD performance and to find out the desire of the informants on the performance appraisal of LPD today. In addition, the integration of HTCA and THK culture are employed to make changes on LPD performance appraisal. This study finds that LPD performance appraisal is more comprehensive and suitable for its identities. The performance appraisal takes the form of the concepts implied in the acronym "HARMONI”, namely: liquidity, assets’ quality, profitability, capital, welfare distribution (give out), and niskama-karma. This concept is expected to provide a better LPD performance appraisal and is capable to provide an increase in the enlightenment and emancipation towards the interested parties in LPD. Keywords—Performance appraisal, reconstruction, Tri Hita Karana culture, LPD