The Paradox of Leadership: Revealing the Driving Factors of Work Discipline in Local Wisdom-Based Start-Ups

The paper is intended to explain how the style of leadership, rewards, and punishments affect work discipline through motivation at PT. WDP, a local wisdom-based start-up company. Using a saturated sample of 34 employees and employing Partial Least Squares Structural Equation Modelling (PLS-SEM), the results show a paradox in that, whereas leadership style and motivation do not have a significant effect on work discipline, rewards and punishments turn out to be the crucial drivers. Moreover, motivation does not act as a mediating variable between leadership style, rewards, punishments, and work discipline. These findings run counter to conventional leadership paradigms that stress the importance of rewards aligned with culture and punishments being fair and consistent in disciplining. The study emphasizes the integration of local cultural values into human resource practices and suggests that participatory leadership, when tailored to an indigenous context, can further elevate employee performance. This research develops actionable insights for start-ups in navigating the intersection of leadership with local wisdom effectively.