Startseite Partnership Quality, Student’s Satisfaction, and Loyalty: A Study at Higher Education Legal Entities in Indonesia
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Partnership Quality, Student’s Satisfaction, and Loyalty: A Study at Higher Education Legal Entities in Indonesia

  • Achmad Supriyanto EMAIL logo , Raden Bambang Sumarsono , Asep Sunandar , Rochmawati , Zummy Anselmus Dami , Dwi Kurnianing Ratri und Nur Luthfi Ardian
Veröffentlicht/Copyright: 8. Oktober 2024

Abstract

Partnership among higher education institutions serves as the central element for sustainable development. The quality of their partnerships is highly necessary for higher education development, specifically in academic infrastructure, curriculum design, pedagogical practices, and financial frameworks. This progression is expected to enhance students’ satisfaction and loyalty. Therefore, this study explores the effects of partnerships among higher education institutions with legal entities on students’ satisfaction and loyalty. Accordingly, this research adopted a quantitative descriptive and regressive survey approach. The research population consisted of students from a university with a legal entity. At the same time, the sample was taken through purposive sampling with the criteria of having interacted or received services from the university’s partner with a legal entity. Data were garnered through questionnaires, which have been declared valid and reliable. The collected data were analyzed using the structural equation model technique through Structural Equation Modeling-Partial Least Squares with SmartPLS 3 application. The research results indicate the following: (1) partnership quality (PQ) directly influences student satisfaction (SS), (2) SS directly affects student loyalty (SL), (3) PQ of higher education institutions with legal entity presents no effects on SL, and (4) PQ indirectly affects SL through SS.

1 Introduction

Among the Southeast Asia countries, Indonesia’s financial inclusion development remains relatively deficient, particularly in comparison to Singapore, Malaysia, and Thailand (Damayanty, Murwaningsari, & Mayangsari, 2022). Meanwhile, efforts to increase financial inclusion have yielded non-maximum results, as observed from the literacy and research data sources, such as regulatory aspects, IT governance, and partnerships for financial inclusion (Damayanty et al., 2022). Additionally, sustainable development has been realized globally. Following this challenge, it is crucial to recognize the importance of collaboration and partnerships between public, private, and other sectors. Excellent management and partnership with international organizations and regional and local associations offer the capacity to resolve development problems (Leal Filho et al., 2022). The partnership also facilitates sustainable development, such as critical resilience and financial sustainability (Akomea-Frimpong, Jin, Osei-Kyei, & Kukah, 2023).

To realize sustainable development, countries require assistance from non-profit organizations, such as higher education institutions with legal entities, adopted in this research (MacDonald, Clarke, & Huang, 2022). Meanwhile, this partnership aids non-profit organizations in resolving complex and complicated organizational problems. Therefore, knowledge and resources from various stakeholders need to be consolidated (MacDonald et al., 2022). Further, regulations and partnerships significantly positively affect an organization’s financial capacity, as reported in a study that partnerships affect financial inclusion, which supports company business (Damayanty et al., 2022).

In addition, excellent quality of beneficial partnerships enables organizations to access external and complementary resources for their research and development projects and strategy formulation, facilitating the ability and agility to respond to market changes and increase customer needs (Liu, 2021; Roberts & Grover, 2012). However, a partnership does not always ensure the attainment of expected outcomes; therefore, the partnership issues that may induce unstable and conflicting relationships should be addressed properly (Lee & Kim, 1998). Consequently, in a partnership, the dimensions of trust, business understanding, benefit/risk share, conflict, and commitment require particular attention (Ee, Abdul Halim, & Ramayah, 2013; Espino-Rodríguez & Ramírez-Fierro, 2018; Lahiri & Kedia, 2009; Lee & Kim, 1998; Park, Chang, & Jung, 2017).

As widely recognized, numerous state universities in Indonesia have transitioned to universities with legal entities. Similarly, the universities in Uzbekistan have also shifted to a self-financing starting from January 1, 2022. Through their most recent policy, these universities have not adjusted students’ tuition for the last 3 years, resulting in financial issues. In particular, these universities have no sufficient funds for educational facilities and accommodation, additional equipment, and modernized laboratories, with 60–70% of their fund allocated for salaries (Jumakulov, 2022).

Essentially, the issues of the financial challenges can be addressed partly through the construction of partnerships (Damayanty et al., 2022) and improving customer loyalty (Latif, Bunce, & Ahmad, 2021). As this study focuses on universities, the targeted customers are students. Through robust loyalty, even the graduates remain devoted to the institution, leading to continuous contributions through donations or collaborations through the provision of internships for students (Snijders, Wijnia, Rikers, & Loyens, 2019; Toledo & Martínez, 2020).

For that steady loyalty, the higher education institution with a legal entity should carefully aim to improve the students’ satisfaction, as it is an essential element for this institution (Muslim, Muttaqin, Aziz, Putri, & Sabila, 2021; Teeroovengadum, Nunkoo, Gronroos, Kamalanabhan, & Seebaluck, 2019). Reciprocally, after they garner excellent student satisfaction (SS), the student’s loyalty will grow since SS significantly influences student loyalty (SL) (Arrivabene, Vieira, & Mattoso, 2019; Azizan & Yusr, 2019; Supriyanto, Wiyono, & Burhanuddin, 2021). To cultivate students’ loyalty and sustainable development in a university with a legal entity, we adopted two central variables: partnership quality (PQ) and SS. Therefore, this study explores the influence of a university’s partnership with a legal entity on students’ satisfaction and loyalty.

Partnerships are established to achieve institutional success (Ruhland & Wiese, 2023). Problems can be highly complicated in an organization, especially when dealt with independently. Therefore, they have to construe a partnership for resolving issues, as well as for attaining maximum benefits, achieving objectives, and maintaining competition (Srinivasan, Mukherjee, & Gaur, 2011; Wibisono, Govindaraju, Irianto, & Sudirman, 2019).

Biko, Musa, Muhammad, and Aliyu (2022), focusing on public–private partnerships through housing provision in Abuja, reported a gap between residents’ and providers’ preferences. Further, the study also described inadequate resident satisfaction with the housing due to the subpar quality of institutional partnerships. The study concludes the need to enhance the residents’ satisfaction. Further, Ndukwe et al. (2023) investigated the electricity services, focusing on the Public–Private Partnership regulation, reporting that the electricity services provision, in collaboration with partners, impacts users’ dissonance behaviors, such as discomfort (Ndukwe et al., 2023). Discomfort is a part of users’ dissatisfaction (Brown & Zahn, 2010; Ngo, 2015).

In addition, Davis, Kettinger, and Kunev (2009) uncovered that partnership among departments and stakeholders affects user satisfaction. The results showed that student–faculty partnership has a positive impact on student participation, grades, sense of belonging, and satisfaction with higher education (Zhao & You, 2024). Student–faculty partnerships include cooperative efforts characterized by equal engagement, shared authority, and mutual respect (Curtis & Anderson, 2021). Such collaboration is characterized by equal engagement, shared authority, and mutual respect (Gerdes, Goei, Huizinga, & DeRuyter, 2022). Consequently, PQ should be consistently maintained due to the significant impact of user satisfaction (Carvalho & Rodrigues, 2022).

Along with their partners, the university, with a legal entity, should establish excellent partnerships. The success and conformity of partnerships can be attained through customer satisfaction. In establishing a partnership, the university should consider its effects on the students, particularly SS (Heffernan, Wilkins, & Butt, 2018). Based on that statement, the hypothesis in this research can be formulated: H1. There is a direct influence from the PQ of the university with a legal entity on SS.

In general, the customer is divided into two segments, namely the loyal and disloyal customers. Customer satisfaction significantly and positively affects their loyalty (Azizan & Yusr, 2019; Brunner, Stöcklin, & Opwis, 2008; Dam & Dam, 2021; Gong & Yi, 2018; Idris, 2022; Latif et al., 2021; Olaleye, Adeyeye, Efuntade, Arije, & Anifowose, 2021; Waheed, Klobas, & Ain, 2021; Yang & Peterson, 2004). A study conducted by Otsetova, Prof, and Dudin (2017) on courier customers in Bulgaria uncovered that customer satisfaction significantly and positively influences customer loyalty. Meanwhile, Ali, Amir, and Ahmed (2021), in a study conducted at Karachi University, Pakistan, described the positive effects of students’ satisfaction, university representation, and university switching cost on students’ loyalty, Toledo and Martínez (2020), involving 805 graduates from business, economy, and management department, revealed that loyalty is significantly affected by satisfaction. The results of research in Indonesian higher education show that the impact of student's satisfaction on their loyalty (Susan et al., 2023). Thus, satisfaction is the most essential predictor of loyalty (Pal, Funilkul, Eamsinvattana, & Siyal, 2022).

Recently, higher education institutions have encountered an intense competitive sphere. Accordingly, higher education institutions with legal entities should enhance their market orientation, which is the key to the university’s success. Additionally, these institutions also need to maintain stakeholder satisfaction and loyalty (García-Rodríguez & Gutiérrez-Taño, 2021). Azizan and Yusr (2019) reported that customer satisfaction, brand trust, and brand image positively and significantly impact customer loyalty. Further, Arrivabene et al. (2019), Bakrie, Sujanto, and Rugaiyah (2019), and Lie, Sudirman, and Butarbutar (2019) described that customer satisfaction significantly and positively influences loyalty. Recent research results confirm the positive and significant influence of SS on their loyalty (Tandilashvili, Balech, & Tabatadze, 2023). Based on that statement, the hypothesis in this research can be formulated: H2. There is a direct influence of the academic community’s satisfaction on the academic community’s loyalty.

The most central rationale for the partnership includes financial gain, reputation, credibility, and customer acquisition. Further, the partnership also provides opportunities for the progression and expansion of business models through innovative products and services (Ruhland & Wiese, 2023). In turn, customer satisfaction affects loyalty (Arrivabene et al., 2019; Bakrie et al., 2019; Lie et al., 2019), realizing substantial benefits for the organization.

In addition, students’ loyalty possesses significant importance for the university with legal entity because the university has to address budget-related issues, accommodation, and intense competition with other universities in attracting students. Through enhanced SL, the university with the legal entity can widen its market orientation (García-Rodríguez & Gutiérrez-Taño, 2021). A study from Hestiningtyas, Putri, and Nurdiani (2022) reported that PQ highly and significantly impacts the loyalty of organization members. Partnership also serves as one of the alternatives for improving customer satisfaction (Artanti, Agustini, Saptono, Hanum, & Regina, 2022). Based on that relational of variables, the hypothesis in this research can be formulated: H3. There is a direct influence of the PQ of a university with the legal entity on students’ loyalty, and H4. There is an indirect influence of university with legal entity PQ on SL mediated by SS.

This study seeks to find answers to the four hypotheses. Based on these hypotheses, the research model is illustrated in Figure 1.

Figure 1 
               Research model.
Figure 1

Research model.

2 Method

2.1 Research Design

This research adopted a quantitative survey with a quantitative descriptive and regressive approach. The independent variable was PQ, while the dependent variables were SL and SS. This type of study tests hypotheses to explain the effect between variables. Data were collected on each student individually; hence, the unit of analysis is individual. Data were collected from students in the university with a legal entity, and one response was taken from each lecturer individually. The data were collected once and represent a portrait from a single point in time (Dami, Imron, Burhanuddin, & Supriyanto, 2022; Dami, Imron, Burhanuddin, Supriyanto, & Pellokila, 2023; Dami, Imron, Burhanuddin, & Supriyanto, 2024). Therefore, this study was represented as a cross-sectional study with a survey type.

2.2 Sample and Procedures

The study involved a population of students across 16 public universities with legal entities. The sampling was performed using purposive sampling, focusing on students with firsthand experience in using the services provided by the university in partnership with their partners. In total, this study involved 875 students from the university with a legal entity. The criteria for the number of research samples based on the structural equation modeling (SEM) analysis (Albright & Park, 2009) were determined by 5–10 times the number of manifest variables/indicators of the overall latent variables. This study used 3 latent variables with 14 manifest variables/indicators; thus, the minimum number of samples used in this study according to the criteria for the number of samples for SEM analysis was 14 × 10 = 140. Based on the formula, the study is feasible because it used 875 samples.

Data were garnered through the distribution of questionnaires facilitated, but the students actively participated in the college organization. Data collection was performed by distributing questionnaires among students with the approval of the universities through permission from the Dean. Specifically, the data were collected by distributing the Google Form link. In this study, when the questionnaires were distributed, 875 questionnaires were collected. So, the 875 respondents who participated answered all the questions.

2.3 Instrument

The PQ variable was measured through five factors consisting of trust, business understanding, benefit or risk share, conflict, and commitment (Aldridge & Rowley, 1998; Chen & Chen, 2014; Ee et al., 2013; Espino-Rodríguez & Ramírez-Fierro, 2018; Figueiredo et al., 2020; Heckman, King, Heckman, & King Katz, 1994; Khoo, Ha, & McGregor, 2017; Lahiri & Kedia, 2009; Lee & Kim, 1998; Park et al., 2017; Teeroovengadum et al., 2019; Yong-Sik & Yung Kyun, 2019). The SL variable was measured through three factors consisting of repeat purchasing or usage service, positive word of mouth, and demonstrating resistance to switch to the competitor (El-Kassar, Makki, & Gonzalez-Perez, 2019; Lai, Pham, Nguyen, Nguyen, & Le, 2019; Lie et al., 2019; McMullan & Gilmore, 2003; Otsetova et al., 2017; Waheed et al., 2021; Zaid & Patwayati, 2021). The SS variable was investigated using the factors of curriculum and learning, reliability, responsiveness, assurance, tangibility, and empathy (Abbas, 2020; Hew, Hu, Qiao, & Tang, 2020; Paposa & Paposa, 2023; Pedro, Leitão, & Alves, 2016). All survey items were evaluated using a 5-point Likert scale, ranging from (1) strongly disagree to (5) strongly agree.

2.4 Data Analysis

The garnered data were analyzed using a descriptive analysis through IBM SPSS Statistics 22. A statistical analysis was also performed using Structural Equation Modeling-Partial Least Squares (SEM-PLS) with SmartPLS 3 application. SmartPLS is a data processing application based on non-parametric statistics, thus eliminating the necessity for data with a normal distribution (Garson, 2016). Although using SmartPLS does not obligate the normal data distribution, it still requires a structural model test through examination of standardized root mean square residual, NonFit Index (NFI), R 2, and Q 2 (Garson, 2016; Hair et al., 2021; Hair Jr., Hult, Ringle, & Sarstedt, 2017a).

3 Results

3.1 Demographic Profile

This study involved 875 students from 16 universities with legal entities as the participants. Their profile recorded in this research included their name, gender, duration of study, highest education level, and origin from a university with a legal entity. Their demographic data are presented in Table 1.

Table 1

Participants’ demographic profile

Characteristics Frequency (n) Percentage
Gender
Male 319 36
Female 556 64
Semester/study duration
1 (+6 month) 103 11.77
2 (+1 year) 3 0.34
3 (+1.5 year) 258 29.49
4 (+2 year) 2 0.23
5 (+2.5 year) 276 31.54
6 (+3 year) 6 0.69
7 (+3.5 year) 139 15.89
>8 (>4 year) 88 10.06
Education
Senior High School 762 87.09
Diploma 3 8 0.91
Diploma 4 19 2.17
Bachelor 82 9.37
Master 4 0.46
University
UNDIP 46 5.26
UNAND 49 5.60
UI 13 1.49
UPI 48 5.49
ITB 24 2.74
IPB 12 1.37
UNS 33 3.77
UNAIR 79 9.03
ITS 71 8.11
UNPAD 93 10.63
UNHAS 11 1.26
UGM 19 2.17
USU 70 8
UNP 88 10.06
UB 96 10.97
UM 123 14.06

Source: The authors (based on the survey data).

Among the 875 participants, 556 (64%) were female, while the remaining 319 (36%) were male. These participants have varied study periods, with 11.7, 0.34, 32.57, 0.23, 31.54, 0.69, 15.89, and 6.97% of them are in the second, third, fourth, fifth, sixth, seventh, and higher than eighth semesters. The data indicated that 87% of respondents were high school graduates pursuing their undergraduate degrees. The remaining of the participants held diploma 3 (1%), diploma 4 (2%), bachelor’s (9%), and master’s (1%) degrees. The last educational background of the participants was that of high school graduates.

3.2 Descriptive Analysis

The descriptive analysis was performed to provide fundamental information concerning the levels of PQ, SS, and SL from 16 state universities with legal entities in Indonesia. The data were garnered using a survey involving 875 respondents. The garnered descriptive data, including interval measures, frequencies, and percentage levels of PQ, SS, and SL, are presented in Table 2.

Table 2

Interval, frequency, and percentage of service quality, academic members’ satisfaction, and loyalty levels

Partnership quality
Interval Category Frequency Percentage
103.8–135 Very high 593 67.77
92.1–103.7 High 148 16.91
70.4–92 Moderate 125 14.28
48.7–70.3 Low 6 0.68
27–48.6 Very low 3 0.34
Student’s satisfaction
193.6–230 Very high 318 36.34
156.7–193.5 High 398 45.49
119.8–156.6 Moderate 143 16.34
82.9–119.7 Low 13 1.49
46–82.8 Very low 3 0.34
Student’s loyalty
50.8–60.4 Very high 313 35,77
41.1–50.7 High 382 43.66
31.4–41 Moderate 158 18.06
21.7–31.3 Low 19 2.17
12–21.6 Very low 3 0.34
Descriptive statistics Mean Std. Deviation Variance
PQ 108.75 15.61 243.70
SS 184.43 29.87 892.81
SL 48.19 8.42 70.92

Source: The authors (based on the survey data).

As shown in Table 2, the mean PQ value is 108.75, which is classified as a very high category. Particularly, these scores are distributed into 67.77%, classified as very high, while 16.19% as high and 14.28% as moderate. Meanwhile, the average SS score is 184.43, which is classified as a high category. In detail, 45.49% of the scores are categorized as high, while 36.34 and 16.34% are categorized as very high and moderate. The mean SL score is 48.19, classified in the high category, with 43.66% of the scores in the high category, while 35.77 and 18.06% in the very high and moderate category.

4 Multicollinearity

Using the Pearson correlation analysis, the multicollinearity test determines the strength of relationships between variables. The results of the analysis that can be used to determine the correlation between the variables PQ, SS, and SL are presented in Table 3.

Table 3

Correlation between independent variables

Construct PQ SS SL
PQ 1
SS 0.782** 1
SL 0.746** 0.881** 1
N 875 875 875

Note: **P < 0.01(1-tailed).

The criteria used to determine whether a variable is said not to occur are multicollinearity if the correlation value between variables <0.8 (Shrestha, 2020). The results of the correlation analysis showed that the correlation value between variables was <0.8, so it was concluded that there was no multicollinearity between variables. These findings provide initial support for the main hypothesis.

4.1 Measurement Model

The validity test on the variables’ indicators was performed using SmartPLS 3. This test was carried out to determine if the indicators measure the variable accurately and effectively. The obtained outer loading for each indicator is presented in Table 4 and Figure 2.

Table 4

Convergent validity and internal consistency

Construct Item code Outer loading Cronbach’s alpha CR AVE
Student’s loyalty SL1 −0.454 0.444 0.782 0.642
SL2 0.669
SL3 0.780
Student’s satisfaction SS1 0.931 0.976 0.981 0.893
SS2 0.932
SS3 0.945
SS4 0.961
SS5 0.949
SS6 0.953
Partnership quality PQ1 0.943 0.898 0.929 0.734
PQ2 0.916
PQ3 0.951
PQ4 0.478
PQ5 0.899

Notes: n = 875. CR: composite reliability; AVE: average variance extracted; SL: Student’s loyalty; SS: Student’s satisfaction; PQ: partnership quality.

Source: The authors (based on the survey data).

Figure 2 
                  PLS-path model.
Figure 2

PLS-path model.

The obtained loading factor is presented in Table 3. This value was further used to identify the convergent validity. The data indicate that indicators PQ 4 (conflict) and SL1 (repeat purchasing or using services) were observed to be invalid, incapable of predicting, and cannot serve as excellent predictors. The invalid factors were gradually removed, particularly those with negative values (SL1), while those with greater than 0.4 were retained (Hair Jr., Matthews, Matthews, & Sarstedt, 2017b). As this study aims to identify facts based on research data, the validity and reliability of a factor are of concern (Esposito Vinzi, Chin, Henseler, & Wang, 2010). The obtained Cronbach’s alpha for the PQ variable is 0.898 > 0.6 (reliable). Further, the reliability of SS is 0.976 > 0.6 (reliable) and SL variable 0.444 < 0.6 (non-reliable). The obtained composite reliability is presented in Table 3, suggesting the composite reliability for PQ of 0.981 > 0.6 (reliable), while the reliability for SS of 0.929 < 0.6 (reliable) and for SL of 0.728 > 0.6 (reliable). Ideally, a variable is classified as valid if it obtains AVE > 0.5. As shown in Table 3, the AVE value for the PQ variable is 0.734 (>0.5), implying its validity. Conversely, the AVE values for the SL and SS variables are 0.642 (>0.5) and 0.893 (>0.5), indicating validity.

A discriminant validity test was performed through SmartPLS using cross-loading results, following particular criteria. The criteria specifically obligate each indicator to have a higher correlation value than other indicators in the same variable. Further, Table 5 presents that each indicator shows a higher correlation value than the other indicators in the same variable, after SL1 was removed because of that, SL1 had an outer loading <0.5 (−0.454) and a Cronbach alpha <0.7 (0.444). Therefore, the indicators are classified as valid.

Table 5

Cross loading value

PQ SL SS Decision
PQ1 0.943 −0.377 0.870 0.943 > −0.377, 0.870 Significance
PQ2 0.917 −0.363 0.887 0.917 > −0.363, 0.887 Significance
PQ3 0.952 −0.392 0.877 0.952 > −0.392, 0.877 Significance
PQ4 0.474 −0.222 0.374 0.474 > −0.222, 0.374 Significance
PQ5 0.899 −0.328 0.751 0.899 > −0.328, 0.751 Significance
SL2 −0.337 0.829 −0.351 0.829 > −0.337, −0.351 Significance
SL3 −0.301 0.773 −0.308 0.773 > −0.301, −0.308 Significance
SS1 0.840 −0.407 0.931 0.931 > 0.840, −0.407 Significance
SS2 0.827 −0.357 0.932 0.932 > 0.827, −0.357 Significance
SS3 0.862 −0.407 0.945 0.945 > 0.862, −0.407 Significance
SS4 0.898 −0.413 0.961 0.961 > 0.898, −0.413 Significance

4.2 Structural Model

Prior to the hypothesis test, the feasibility of the structural model was assessed through standardized root mean residual (SRMR) and NFI values garnered from the bootstrapping procedure in SmartPLS 3. A model is categorized as fit or satisfactory if its SRMR value is less than 0.100. Meanwhile, the investigation using NFI value was conducted using specific distinct criteria. The NFI value exceeding 0.80 indicates a good fit, while if the NFI is between 0.60 and 0.80, the model is categorized as a moderate fit. If the NFI is lower than 0.60, the model is classified as not fit (Hair Jr. et al., 2017b). The results of SRMR and NFI observation using SmartPLS 3 are shown in Table 6.

Table 6

SRMR and NFI value

Saturated model Estimated model
SRMR 0.053 0.053
NFI 0.924 0.924

In addition, the obtained SRMR of 0.053 < 0.100 implies that the model meets the required criteria. The model attained a 0.924 score for the NFI, indicating its good fit criteria. Aside from the SRMR and NFI, the structural model was also assessed through the R 2 and Q 2 values.

The R 2 coefficient serves as the instrument facilitating the investigation of the ability of the exogenous construct to describe the endogenous construct. Ideally, R 2 falls between 0 and 1 (Sarstedt, Ringle, & Hair, 2017). It indicates the degree to which another can explain one variable’s variance. For the R 2 coefficient evaluation, a strong model presents R 2 > 0.75, while the moderately robust model has 0.50 < R 2 < 0.75, while weak and very weak models have 0.25 < R 2 < 0.5 and < 0.5 (Sarstedt et al., 2017). Further, the adjusted R 2 represents the corrected R 2 following the standard error. The adjusted R 2 offers a more reliable illustration of an exogenous construct’s ability to explain the endogenous construct compared to the R 2 (Table 7).

Table 7

R 2 and Q 2 coefficient determinant

R 2 R 2 adjusted SSO SSE Q² (= 1 – SSE/SSO)
SL 0.173 0.172 2124.000 861.843 0.106
SS 0.824 0.824 1062.000 284.612 0.732

Predictive relevance (Q 2) was garnered through the blindfolding method (Table 7). This blindfolding method aims to investigate the predictive relationship between the constructs of the dependent variable in the model and the constructs of the independent variable (Henseler & Sarstedt, 2013). If ∑Q 2 > 0 was obtained, the specific dependent constructs in the model are assessed with predictive relevance regarding the independent constructs. A model with predictive relevance has Q 2 > 0, while Q 2 < 0 indicates that a model has no predictive relevance. A value approaching 1 indicates a better model (Henseler & Sarstedt, 2013).

The obtained coefficient determination R 2 presented in Table 7 suggests that PQ influences SS with an R 2 of 0.824 and an adjusted R 2 of 0.824. Therefore, the exogenous construct PQ influences SS by 0.824 or 82.4%. Meanwhile, the PQ and SS were observed affecting CL with an r 2 value of 0.173 and an adjusted R 2 of 0.172 or 17.2%. Accordingly, the exogenous construct PQ presents high effects on CL (>75%), while the effects of PQ and SS constructs on CL are exceedingly weak (25%).

Table 7 also presents Q 2 of the PQ variable toward the SS variable, showing a score of 0.732 > 0. Therefore, PQ possesses significantly strong predicting relevance to SS as its score approaches 1. Meanwhile, the Q 2 score of PQ and SS toward the SL variable was observed at 0.106 > 0, indicating weaker predictive relevance than the PQ toward SS.

In general, the obtained data signify a weak structural model depicting the influence of PQ and SS toward CL. Further, the direct influence of PQ on CL was observed as non-existent and non-significant. Meanwhile, its indirect influence is mediated by SS.

5 Test of Hypothesis

In the hypothesis test, the direct influence of PQ on SS, SS on SL, and PQ on SL. Aside from the direct impact, the indirect impact of PQ on SL, with the mediating variable of SS, was also examined. Their interrelationship was analyzed through SEM PLS using the SmartPLS 3, utilizing bootstrapping to obtain P-values and T statistics.

5.1 Direct Effect

Following the results of the analysis conducted through SmartPLS 3, the model of intervariable relationships shows a direct influence of PQ on SS, SS on CL, and PQ on SL. Therefore, with a 5% or 0.05 error tolerance level, the variable was concluded to have effects if t count > 1.96, and its effect was deemed significant if P values <0.5. In contrast, if t count < 1.96, then H 0 was accepted. The obtained P values and t count from the SmartPLS 3 calculation are presented in Table 8.

Table 8

Direct effect

Direct influence T statistics (|O/STDEV|) P values Conclusion (T > 1.96) Conclusion P values (<0.5)
PQ → SS 128.866 0.000 There is effect Significant
SS → SL 3.704 0.000 There is effect Significant
PQ → SL 1.646 0.100 No effects Insignificant

5.2 Partnership Quality on Student’s Satisfaction

The results presented in Table 7 suggest that the influence of PQ on SS has P-values of 0.000 and t count of 128,866. As the obtained P-values < 0.5 and t count > 1.96, signifying that H 0 was rejected and there were direct and significant influences from PQ on SS.

5.3 Student’s Satisfaction on Student’s Loyalty

The analysis results using SmartPLS 3 indicate the effects of SS on SL with P-values of 0.000 and t count of 3.704. Accordingly, as the P-values <0.5 and t count > 1.96, H 0 was rejected, and the SS variable presents significant direct effects on SL.

5.4 Partnership Quality on Student’s Loyalty

The analysis of the PQ variable’s effects on SL suggests P-values of 0.100 and t count of 1.646. Thus, H 0 was accepted and PQ variable was proven to have significant effects on SL, as the obtained P-values > 0.5 and t count < 1.96.

5.5 Indirect Effects

For the indirect influence model focusing on the effects of PQ on SL, the analysis was conducted using SmartPLS 3. A variable is concluded to have an indirect influence if it presents a t-value >1.96, while its influence is deemed significant if P-values <0.5. The obtained t-value and P-values for the indirect influence are presented in Table 9.

Table 9

Indirect effect

T statistics (|O/STDEV|) P-values Description T statistics (T > 1.96) Description P-values (<0.5)
PQ → SS → SL 3.702 0.000 No effects Significant

From the calculation results, the t count for PQ’s effects on SL mediated by SS is 3.702 with P-values of 0.000. Therefore, H 0 was rejected, and there is an indirect significant influence of PQ on SL through SS.

6 Discussion

6.1 Effects of Partnership Quality on Student’s Satisfaction

The research analysis suggests a significant influence of PQ on SS, as they show P-values of 0.000 < 0.5 and t count of 128.866 > 1.96. This significant effect implies that a high-quality partnership of the university with legal entities indicates high SS and vice versa. This relationship is evident from the results of the analysis, suggesting that with excellently high PQ, SS falls within the “high” criteria.

The high-quality partnership is attributed to several factors, including trust, business understanding, benefit or risk sharing, and commitment. These factors present outer loading >0.7, implying their robust capacity as the predictor of PQ. As reported by Ee et al. (2013), Espino-Rodríguez and Ramírez-Fierro (2018), Lahiri and Kedia (2009), Lee and Kim (1998), and Park et al. (2017), trust, business understanding, benefit or risk share, and commitment are the excellent predictor of PQ. However, the factor of conflict is identified as having 0.478, suggesting its possibly weaker predicting capacity in the PQ domain. Ideally, an excellent partnership is characterized by minimum conflicts as it streamlines the partnership activities (Osei-Kyei, Chan, Yu, Chen, & Dansoh, 2019). However, in a long-term relationship, a conflict is nearly inevitable because of distinct viewpoints from numerous stakeholders (Osei-Kyei et al., 2019). This feeble ability to predict conflict may also be attributed to the low conflicts between the university, legal entities, and their partners.

Similar to our findings, the study conducted by Thung (2019) on the Go-Jek partners and Istiqomawati (2017) on the customers of Payung Argodana Pudak Bank, Semarang, also reported that excellent partnership induces greater customer satisfaction.

6.2 Effects of Student’s Satisfaction on Student’s Loyalty

SS has also recorded significant influence on SL, as indicated by the garnered P-values of 0.000 < 0.5 and t count of 3.704 > 1.96. The significant and positive correlation between SS and SL signifies that greater SS corresponds to higher levels of SL and vice versa. As recorded in this study, high SS corresponds to high loyalty. Additionally, high SS may also be attributed to the curriculum and learning, reliability, responsiveness, assurance, tangibility, and empathy (Aldridge & Rowley, 1998; Chen & Chen, 2014; Figueiredo et al., 2020; Heckman et al., 1994; Khoo et al., 2017; Teeroovengadum et al., 2019; Yong-Sik & Yung Kyun, 2019). All these factors have been observed to present an outer loading value of >0.7. Linearly, Azizan and Yusr (2019), Brunner et al. (2008), Dam and Dam (2021), Gong and Yi (2018), Idris (2022), Latif et al. (2021), Olaleye et al. (2021), Waheed et al. (2021), and Yang and Peterson (2004) reported positive and significant effects from customer satisfaction on their loyalty.

6.3 Effects of Partnership Quality on Student’s Loyalty

From the analysis results, PQ variable influence on SL presents P-values of 0.100 and t count of 1.646; thereby, PQ has no direct influence on SL. In this study, students’ loyalty was measured through three factors, namely repeat purchasing or service usage, positive word of mouth, and demonstrating resistance to switch to the competitor (El-Kassar et al., 2019; Lai et al., 2019; Lie et al., 2019; McMullan & Gilmore, 2003; Otsetova et al., 2017; Waheed et al., 2021; Zaid & Patwayati, 2021). Among those factors, the positive word of mouth and resistance to switching to the competitor are classified as great predictors with outer loading of 0.669 and 0.780. In contrast, the repeat purchasing or using service predictor attained an outer loading of −0.454.

The absence of impacts from PQ on SL can be attributed to numerous factors, such as students’ low interest in pursuing higher education, leading to a diminished repeat service usage factor in the loyalty construct. Further, this low inclination to pursue higher education has been widely reported across Indonesia, proving the rarety of higher education compared to secondary education. In 2017, approximately 16% of Indonesian youth have completed higher education, far below the average of G20 countries (38%) (OECD, 2019). Further, in 2022, 42% of young adults leave school without a high school qualification, 14% higher than the OECD country average (OECD, 2022). These data significantly impacts students’ loyalty, specifically the service usage predictor, since the limited pursuit of higher studies results in a lack of continuation for students to use university services repeatedly.

People’s low interest in pursuing higher education is also affected by the unexamined variables, such as the role of parents (Hariyadi, Cahyadi, & Slamet, 2022) and economic issues (Sudradjat, Muktiadji, Gendalasari, & Hendrian, 2015; Zaini, Mansor, Yusof, & Sarkawi, 2019). The issues of the economy also cause low repeat purchasing factors in the PQ dimension. Although the PQ presents no direct effects on students’ loyalty, it has indirect effects mediated by the students’ satisfaction.

6.4 Effects of Partnership Quality on Student’s Loyalty through Student’s Satisfaction

Mediated by SS, PQ influences students’ loyalty, as evidenced by t count of 3.702 and P-values of 0.000. The obtained data suggest significant indirect effects of PQ on SL through the SS. Student or user satisfaction has been commonly reported as the mediating variable in various research models (Istiqomawati, 2017; Thung, 2019). Linearly, Istiqomawati (2017) and Thung (2019) also reported that excellent PQ generates user satisfaction. Meanwhile, Prasantyo and Kartika (2023), Sari, Widayanti, and Soedarto (2021), and Trieanto, Ismiasih, and Manumono (2022) uncovered positive effects of user satisfaction on their loyalty. Customer satisfaction is one of the intervening variables influencing the partnership’s impact on customer loyalty (Istiqomawati, 2017).

In educational services, cultivating SS and loyalty is essential since it translates into financial support for the university. In the long-term strategy, SL can materialize competitive advantage. Essentially, loyalty is the ongoing support for a product over a period of time (Twum, Yalley, Agyapong, & Ofori, 2021; Yang & Peterson, 2004). The alumnae can continuously support universities through great loyalty through financial contributions and work opportunities for fresh graduates (Rojas-Méndez, Vasquez-Parraga, Kara, & Cerda-Urrutia, 2009). Thus, alumni loyalty is a significant value for higher education institutions as it can be presented in time and financial resources (Snijders et al., 2019).

6.5 Strength of Study

This study is relevant amidst the transition trend of Indonesian state higher education institutions transitioning into universities with legal entities. This transformation aims to streamline the operational aspects of teaching, research, and community engagement in the organization for greater effectiveness and efficiency (Swasti, Sonhadji, Bafadal, & Supriyanto, 2018). This study also aligns with the research focusing on quality improvement and innovation of higher education during the Industrial Revolution 4.0 (Supriyanto, Djum, & Benty, 2019). Quality is inherently subject to change and the evolution of times (Supriyanto et al., 2019). Accordingly, in the 4.0 era, universities must continuously enhance their quality.

In addition, sustainable development has been declared as a global program (Leal Filho et al., 2022). Particularly, in the recent digital economy era, higher education plays a pivotal role in economic advancement (Kholiavko, Popelo, Melnychenko, Derhaliuk, & Grynevych, 2022). However, the higher education institutions in Indonesia exhibit relatively minimum contribution to the nation’s progression due to their insufficient quality. This low quality is induced by numerous factors, such as governance mistakes in the institutional stage (Rosser, 2023).

In facing these quality and management issues in higher education institutions, partnerships with other foundations appear as the alternative (Leal Filho et al., 2022). The partnership has enhanced sustainable development, particularly in critical resilience and sustainable finance (Akomea-Frimpong et al., 2023). Partnership is established based on the needs of an organization. For instance, a school can partner with a training center to improve students’ competencies (Yuanita, Supriyanto, & Mustiningsih, 2020).

Following the results of the analysis, several conclusions are made. First, PQ directly impacts the level of SS. Second, SS has a direct effect on SL. Third, the quality of the partnership is observed to have a direct influence on student quality. Fourth, the study revealed an indirect influence of PQ on SL, mediated by SS. In this study, students’ loyalty is established through their satisfaction, while the satisfaction is constructed through partnership. Students’ great loyalty and satisfaction characterize a successful higher education institution (García-Rodríguez & Gutiérrez-Taño, 2021; Latif et al., 2021; Rojas-Méndez et al., 2009). For this loyalty and satisfaction, the university must form a partnership with a legal entity. The analysis’s finding emphasizes that partnerships are influential in the sustainable development of universities with legal entities. Borodiyenko, Zlenko, Malykhina, Kim, and Diachkova (2022) described the need to support educational institutions’ strategic development, particularly through bureaucracy, business orientation, communication, and partnerships.

The research uniqueness lies in detecting repeat purchasing or service usage factors that fail to predict students’ loyalty variables, as evidenced by the obtained outer loading value of −0.454 < 07. This finding implies that conflict cannot predict excellent PQ. The failure of the conflict factor in predicting the PQ is attributed to the absence of conflict between the university and the legal entity and its partnership. Ideally, Excellent partnership materializes into a harmonious and secure environment, enhancing a company’s productivity (Herman et al., 2023). Further, the data analysis also suggests a high category of PQ. Interestingly, we also observed that the repeat purchasing or service usage factor on SL has a low predicting ability with an outer loading of −0.454. The failure of the repeat purchasing or repeat services usage factor is possibly caused by students’ low interest in reusing services or their lack of interest in pursuing further education (OECD, 2019, 2022), coupled with issues related to insufficient parental support and economic factors (Sudradjat et al., 2015; Sudradjat, Muktiadji, Gendalasari, & Hendrian, 2018).

7 Conclusion

On average, the obtained PQ score is 108.75, categorized as exceedingly high, with 67.77% classified as very high, 16.19% as high, and 14.28% as medium. Meanwhile, the average student’s satisfaction score is 184.43 (high), while 45.49% are classified as high, 36.34% as very high, and 16.34% as moderate. Lastly, the average student’s loyalty score is 48.19 (high category) with the following percentage distribution: 43.66% high, 35.77% very high, and 18.06% moderate.

The PQ was assessed through five central predictors. Among those predictors, trust is a strong predictor with an outer loading of 0.943 > 0.7, along with business understanding obtaining an outer loading of 0.916 > 0.7. Meanwhile, benefit and risk share and commitment present outer loading of 0.951 > 0.7 and 0.899 > 0.7, respectively, categorized as strong predictors. Contrastingly, conflict has limited predictive power in the PQ, as evident from its modest outer loading of 0.478. Further, this finding also suggests that there is low conflict in the university with the legal entity and its partners.

Student satisfaction has six predictors, including curriculum and learning, reliability, responsiveness, assurance, tangibility, and empathy. Each of those predictors has an outer loading value of 0.931, 0.932, 0.945, 0.961, 0.949, and 0.953, respectively. The obtained outer loading values for the student’s satisfaction variable factor are >0.7, suggesting their robust predicting power.

There are six predictors of SS. Among those predictors, curriculum and learning attain outer loading of 0.931, while reliability, responsiveness, assurance, tangibility, and empathy secure outer loading of 0.932, 0.945, 0.961, 0.949, and 0.953. These predictors generate strong predictions as their outer loading exceeds 0.7. Between those predictors, repeat purchasing or service usage presents a low outer loading value of −0.454, suggesting its weak influence on student quality at the higher education institution with a legal entity. This low influence can be caused by students’ low interest in pursuing further education in Indonesia due to a lack of parental and economic support. Apart from repeat purchasing or service usage, the positive word-of-mouth factor shows a fairly strong predicting capacity with an outer loading value of 0.669. Additionally, resistance to switching to a competitor emerges as a robust predictor, boasting an outer loading value of 0.780, exceeding the 0.7 benchmark.

The research findings can be summarized into the following: (1) there is a direct influence of the PQ variable on SS, evidenced by P values of 0.000 < 0.5 and t count of 128.866 > 1.96; (2) there is a direct influence of the student’s satisfaction variable on student’s loyalty, illustrated by P values of 0.000 < 0.5 and t count of 3.704 > 1.96; (3) there is no direct influence of the PQ variable on student’s quality with P values of 0.100 > 0.5 and t count of 1.646 < 1.96; and (4) an indirect influence of the PQ variable on student’s loyalty through student’s satisfaction is observed, with a t-value of 3.702 (>1.96) and a significant P value of 0.000 (<0.5).

7.1 Implication, Limitations, and Future Research

Theoretically, this research confirms that the factors of PQ, including trust, business understanding, benefit or risk share, and commitment, serve as excellent predictors with an outer loading >0.7, as reported by Ee et al. (2013), Espino-Rodríguez and Ramírez-Fierro (2018), Lahiri and Kedia, (2009), Lee and Kim (1998), and Park et al. (2017). However, the conflict factor presents low predicting power with an outer loading value of 0.478 < 0.5.

In addition, the student’s satisfaction factor consists of curriculum and learning, reliability, responsiveness, assurance, tangibility, and empathy. Each of these factors serves as a good predictor with an outer loading value >0.7, similar to the report from Aldridge and Rowley (1998), Chen and Chen (2014), Figueiredo et al. (2020), Heckman et al. (1994), Khoo et al. (2017), Teeroovengadum et al. (2019), and Yong-Sik and Yung Kyun (2019). Furthermore, the factors of SL variable, specifically positive word of mouth and demonstrating resistance to switching to a competitor, emerge as reasonably good predictors, as previously reported by El-Kassar et al. (2019), Lai et al. (2019), Lie et al. (2019), McMullan and Gilmore (2003), Otsetova et al. (2017), Waheed et al. (2021), and Zaid and Patwayati (2021). However, the repeat purchasing or service usage factor has an outer loading value of −0.454, indicating its incapacity to predict the students’ loyalty. Further, the regression analysis results suggested (1) a direct influence of the PQ variable on SS; (2) a direct influence of the student’s satisfaction variable on SL, evidenced by P values of 0.000 < 0.5 and a t count of 3.704 > 1.96; (3) there is no direct influence of the PQ variable on student’s quality, with P values of 0.100 > 0.5 and a t count of 1.646 < 1.96; and (4) there is an indirect influence of the PQ variable on student’s loyalty through student’s satisfaction, indicated by a t count of 3.702 > 1.96 and P values of 0.000 < 0.5.

Practically, the research results of this research imply the need for Indonesian universities with legal entities to support sustainable development in Indonesia by focusing on the quality of sustainable partnerships (Akomea-Frimpong et al., 2023). With the complex issues encountered by higher education institutions with a legal entity, collaboration with partners is essential (MacDonald et al., 2022). This partnership is particularly essential to fulfill their needs and resolve the shortcomings of the university with a legal entity, such as in the aspects of human resources, finances, facilities, and services. The increasing quality of partnership results in greater SS and loyalty (Dwijayanti, Ridwan, & Rohani, 2021; Hestiningtyas et al., 2022; Pastika, Suparta, & Dewi, 2016; Sari et al., 2021; Trieanto et al., 2022). Alumni loyalty provides essential support to the university, specifically through verbal endorsements, along with financial contributions in the form of job opportunities for fresh graduates (Hassan & Shamsudin, 2019) and solidarity among alums. Their positive word of mouth, financial contribution, and job offerings for the fresh graduates are crucial for the university (Rojas-Méndez et al., 2009). Therefore, their loyalty is essential for the higher education institution (Snijders et al., 2019).

This research is relevant to studying quality improvement and innovation in higher education during the 4.0 era (Supriyanto et al., 2019), leading to transformed expected quality (Supriyanto et al., 2019). In this 4.0 era, the university has to continuously enhance its quality, including the quality of its partnership. The results of this study corroborate previous research suggesting the influence of PQ on satisfaction (Dwijayanti et al., 2021; Sari et al., 2021; Trieanto et al., 2022), satisfaction on loyalty (Hestiningtyas et al., 2022; Pastika et al., 2016), as well as PQ to loyalty mediated by satisfaction (Hestiningtyas et al., 2022; Pastika et al., 2016).

This research was only conducted in 16 public universities in Indonesia. Meanwhile, there are still many other private universities that have not been researched. Therefore, future research can make a comparison between public universities and private universities. This research only focuses on PQ and its influence on SS and loyalty. Therefore, further research is still open to examining aspects of policy, management, leadership, academic service quality, total quality management, productivity, decision-making, and quality culture to improve the high quality of future organizations. It is hoped that further research can provide the best service quality model for students or customers in higher education.

Acknowledgments

A thank you to the Directorate General of Higher Education, Research and Technology, the Ministry of Education, Culture, Research and Technology, and the State University of Malang, who have contributed and facilitated this research so that this empirical work can be carried out.

  1. Funding information: The article’s publication was financed by the Directorate General of Higher Education, Research and Technology, the Ministry of Education, Culture, Research and Technology, in the scope of the project 036/E5/PG.02.00.PL/2023.

  2. Author contributions: A. Supriyanto: conceptualization, original draft writing, methodology, data analysis, and visualization; R. B. Sumarsono: supervision, data collection, original draft writing, and project administration; A. Sunandar: literature review during revision, updating obsolete references, original draft writing, and data collection; Rochmawati: data collection, literature review during revision, and editing; Z. A. Dami: literature review during revision, response to reviewer comments, and language editing; D. K. Ratri: data collection during validation and editing; N. L. Ardian: data collection and editing. All authors have read and agreed to the published version of the manuscript.

  3. Conflict of interest: The authors state no conflict of interest.

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Received: 2023-10-10
Revised: 2024-07-06
Accepted: 2024-08-27
Published Online: 2024-10-08

© 2024 the author(s), published by De Gruyter

This work is licensed under the Creative Commons Attribution 4.0 International License.

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