Psychological Empowerment and Organizational Commitment, Its Effect on the Performance of Village Credit Institutions (LPD) in Badung Regency

The article reviews the role of psychological empowerment and the commitment of the Village Credit Institution (LPD) management in achieving LPD performance. Psychological empowerment includes meaning, competence, self determination and impact. Organizational commitment includes three dimensions of affective, normative and continuous commitment. This article also reveals the role of LPD management commitments in mediating the role of the psychological empowerment of administrators on LPD performance. Psychological empowerment is very instrumental in growing the commitment of LPD management. The commitment of the management also plays a significant role in improving LPD performance. The commitment of the management has a role as a full mediated in relationship between Psychological Empowerment and LPD Performance. This illustrates that the better psychological empowerment possessed by LPD management can strengthen their commitment to the organization (LPD), which is finally able to encourage LPD performance to be better.

LPD as a business institution belonging to the Customary Village is important to be supported by a board that has high psychological empowerment, because it will strengthen its commitment to the organization, thus delivering LPD to achieve ever-increasing performance.