INTERNATIONAL JOURNAL OF BASIC AND APPLIED SCIENCE

P-ISSN: 2301-4458 E-ISSN: 2301-8038 Vol. 01, No. 02 Oct 2012

Insan Akademika Publications

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The Influence of Corporate Culture on Organizational Commitment; Case Study of Civil Government Organizations in Indonesia Astri Ghina School of Business and Management - Institut Teknologi Bandung Jl. Ganesha No. 8, Bandung-Indonesia [email protected]

Key words

Abstract

Corporate culture, Civil Government Organization Organizational Commitment

The aim of this study was to examine the influence of corporate culture on employees’ organizational commitment. The corporate culture that examine in this research was consist of four dimensional which are teamwork; communication; reward and recognition; training and development. The study was replication research from Boon and Arumugam’s paper, and we were anxious to find out the extent of corporate culture influence the employee’s organizational commitment within the context of Civil Government in Indonesia, because only a few empirical researches has examined in this area of study. I also used the similar tool that is hierarchical regression analyses to test the research hypotheses. The results show that communication, training and development, reward and recognition, and teamwork are positively associated with organizational commitment. Also, communication was perceived as a dominant corporate culture dimension; and it was consistent with the result from original paper. There were only a few differences in the social variables (controlling variables) that also influence organizational commitment in the context of civil government in Indonesia. This study contributes to a better understanding of the influence of corporate culture and social variables on organizational commitment among employees within the context of the Civil Government Organization. The limitation and future research are also discussed. © 2012 Insan Akademika All Rights Reserved

1

Introduction

Basically, performance is results that reached by workers according to specified standard or criterion in accordance with certain job. In practice, performance is influenced by many factors; one of them is organizational culture. The performance management is very important in all organization, especially in government organization, because they provide service toward citizen. Therefore to improve the government organization’s performance as a whole, we must concern to crucial factors that influence its performance. According to Suharto (2005) in Abdulloh (2006), the influence of organizational culture toward performance can be shown from employee's result orientation and how decision is made, who did it, how reward is applied, who is promoted, how treated, how organization responds to its environment. Hofstede, et al., (1990) state that organization culture is part of organization life that influence behavior, attitude, and effectively of all employees. Corporate culture has a potential affect a range of organizationally and individually desired outcomes such as commitment loyalty, turnover intent, and satisfaction (Chow et al., 2001 in Boon and Arumugam, 2006)

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This study was the replication from Boon and Arumugam’s paper, the original topic is “The Influence of Corporate Culture on Organizational Commitment: Case Study of Semiconductor Organizations in Malaysia” (2006). I really interested in this topic and I was anxious to implement this study in the context of Civil Government sector, because there were only a few empirical literatures on corporate culture within the context of the Civil Government in Indonesia, particularly on how corporate culture affect the organizational commitment among employees that have special attention in the organizational literature. The Civil Government is considered to be the public servant that has to give best service toward citizen; therefore corporate culture is strategically important for improving their performance that will encourages the citizen’s satisfaction. Since one of the factors that influence organizational commitment is corporate culture, I will provide the government organization how to deal with this issue. Therefore, the research purpose was to examine whether the application of corporate culture’s dimensions such as teamwork, communication, reward and recognition, and training and development, are could improve the working environment and give the impact of the employee’s commitment. I also include the theory of organizational culture and organizational commitment, and the relationship between both of them. And I also used the similar hypotheses as the original paper, because I was curious whether those hypotheses are still relevant if applied in the different context of organization and different country. In the next part, I discuss the results that have a bit different with the results from the original paper; I also discuss the limitation of my research, so hopefully it will be a future research. Finally, I discuss the summary of this research and the suggestion for government organization.

2

Literature Review and Hypotheses Development

Corporate Culture In the organizational behavior literature, corporate culture has been defined in many ways by various authors and researchers. Hofstede, et al., (1990) state that organization culture is part of organization life that influence behavior, attitude, and effectively of all employees. Culture is several of interactions from habit features that influence the groups in their environment (Hofstede, 1986). According to Kreitner and Kinicki (2003) in Abdulloh (2006), organization culture is values, assumptions and norms that believed as the truth as medium to improve employee's quality in order to reach the company's goal. It is like social adhesive (Kreitner and Kinichi, 1995). It is also mentioned in the original paper that “corporate culture can be referred to as a set of values, beliefs, and behavior patterns that form the core identity of organizations and that help in shaping their employees’ behavior” (Lund, 2003). Organization Culture is philosophy, ideology, values, assumption, belief, expectation, attitude and norms that owned by together and bound in a certain community (Kilmann, et al., 1985). Culture is core from what is important in organization, like activity to give command and prohibition and depict matters of conducted and not conducted that arrange their member behavior (Beach, 1993). According to Molenaar (2002) in Koesmono (2005); and Kotter and Heskett, (1992), culture has full of strength that influence its individual and performance even to work environment.

Organizational Commitment The issue of organizational commitment is very important for managers in organization (Tushman and O’Reilly (1997); Nadler, 1997).; and Limerick, et al., 1998), either government organization or private sector. In order to increase their competitive advantage, the managers always seeking ways to enhance their employee’s commitment. They are more concern to find strategic way that has a big influence toward commitment. Organizational commitment refers to an employee’s belief in the organization’s goals and values, desire to remain a member of the organization and loyalty to the organization Mowday, et al., 1982; and Hackett, et al, 2001). This definition, reflecting an individual’s affective commitment, represents a major approach to the study of organizational commitment (Meyer et al., 2002 in Boon and Arumugam, 2006), and appears to be the most desired form of commitment.

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Meyer and Allen (1991) in Parish, et al., (2008), has proposed model comprising affective, continuance, and normative commitment. According to Meyer and Allen (1991) in Parish, et al., (2008), affective commitment (AC) “refers to the employee’s emotional attachment to, identification with, and involvement in the organization” (employees stay with a firm because they want to); continuance commitment (CC) “refers to an awareness of the costs associated with leaving the organization” (employees stay with a firm because they need to); and normative commitment “reflects a feeling of obligation to continue employment” (employees stay with a firm because they ought to).

The Link between Corporate Culture and Organizational Commitment The topic of organizational commitment has received a big deal of interest, and several studies have been examining the antecedents of organizational commitment, for example Boon and Arumugam (2006), Crawford and Lock (2001), Yiing and Zaman (2009). One possible antecedent of organizational commitment that has remained relatively free of empirical investigation is organizational culture (Crawford and Lok, 2001). According to Crawford and Lok (2001), organizational culture plays an important role in generating commitment and enhancing performance, it was also stated by other researchers (Deal and Kennedy, 1982; Peters and Waterman, 1982 in Yiing and Zaman (2009). “A strong organizational culture is seen by researchers such as Scott (1987) as being a belief system that sustains the commitment of individual members to the good of the organization”(Wilson, 1997). In this paper I have discussed of corporate culture dimensions on a slightly modified version of Boon and Arumugam’s paper (2006) work. After conducting the confirmatory factor analysis for all items of questionnaire that has been modified by author, four core dimensions of corporate culture have been adopted in this study, there are communication, training and development, rewards, and teamwork.

Training and Development Training and development can be defined as the process of providing employees with specific skills or helping the employee correct deficiencies in their performance (Poh, 2001 in Boon and Arumugam, 2006). From management’s view point, training can be regarded as a means of engaging the commitment of employees to organization (Heyes and Stuart (1996) in Soltani and Liao (2010); Bartlett, 2001). In the Harvard map of HRM, Beer et al. (1984); in Soltani and Liao (2010) talk about “training as one of the several human resource flows which altogether lead to achieving the ‘four Cs’ of HR outcomes: commitment, congruence, competence and cost effectiveness”. Bartlett (2001), McCabe and Garavan (2008) were studied the relationship of training and development among nurses toward commitment, they found that perceived access to training, social impact of training, motivation to learn, and perceived benefits of training are positively related to organizational commitment. Moreover, Deming (1986) in Boon and Arumugam (2006) stressed the importance of education and training for continual updating and improvement, identifying one source of human motivation at work as intrinsic motivation: the desire to grow; learn, and to develop oneself. Training is provide for generating new knowledge, and new knowledge is attained through learning, based on research conducted by Savolainen (2000), suggest that managerial commitment to change is a complex construct and that it is linked with perceptions of quality and with learning. Thus, I propose the similar hypothesis with the original paper: H1 :

Employees perceive that training and development will be positively related to their organizational commitment within their organizations.

Reward and Recognition Reward and recognition can be defined as benefits—such as increased salary, bonuses, and promotion— which are conferred as public acknowledgement of superior performance with respect to goals (Juran and Gryna, 1993; in Boon and Arumugam (2006). According to Chew and Chan (2008), remuneration and 158

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recognition positively predicted organizational commitment and intention to stay. Based on Liu (2007), training satisfaction and perceived reward equity were the only antecedent factors that showed significant positive relationship with organizational commitment. Rewards for quality efforts appear to have a significantly positive relation to employee morale (Kassicieh and Yourstone, 1998 in Boon and Arumugam (2006). The study was conducted by Williamson, et al. (2009) showed a significant two-way interaction between the cultural dimension of collectivism and organizational rewards on employees’ commitment. According to Herzberg’s (1996) in Boon and Arumugam (2006) hygiene/ motivator theory, recognition is one of the four motivators, which can contribute to employee commitment when it is present. Participation in decision making is a part of recognition activities, and the study was conducted by Ladd, et al, (2006) revealed that participation in decision making positively influences work effort, autonomy and commitment, practitioners need to be mindful of keeping a balance between employee and employer needs. Thus, I propose the similar hypothesis with the original paper: H2 :

Employees perceive that reward and recognition will be positively related to their organizational commitment within their organizations.

Organizational Communication A dynamic inter-relationship between culture and communication must be acknowledged. Corporate cultures will generally be communicated to stakeholders in some form, particularly through employee behavior and therefore one method of reducing the occurrence of negative uncontrolled communication is by gaining employee commitment of core corporate values (Melewar and Karaosmanoglu, 2006). So, there is an interdependence relationship between communication and employee commitment. Robbins (2001) also stated that there is a relationship between the employee communication and employee motivation and commitment. Organizational communication is all forms of communication with stakeholders with all parties that an organization has an interdependence relationship (Van Riel, 1995). Organizational communication refers to the process whereby individuals and groups transact in a variety of ways and within different areas with the aim of carrying out organizational goals (Smidts et al., 2001; Brunetto and Farr-Wharton (2004) in Boon and Arumugam (2006). Several authors note that communication is important for improving employees’ commitment and for positive outcomes (Goris et al., 2000; Pettitt et al., 1997; Guimaraes, 1996; Guimaraes, 1997; in Boon and Arumugam (2006). Study was conducted by Vakola and Bouradas (2005). indicated that silence behavior can be responsible for low commitment and satisfaction. The results of the study indicated that the strongest predictor of organizational commitment is communication opportunities. Past research supports this finding indicating that communication satisfaction among other organizational processes is a determinant of organizational commitment (Putti and Aryee, 1990; and Carriere and Bourque, 2009). According to Hooff and Ridder (2004), communication climate is found to be a key variable, a constructive communication climate was found positively influence knowledge donating, knowledge collecting, and affective commitment. Farrelly, et al. (2003) suggested that market orientation and collaborative communication are both important determinants of sponsorship commitment, defined as a sponsor’s preparedness to leverage the association. Walker, et al. (2009) also stated that positive communication has the association with affective and normative commitment. Therefore, I propose the similar hypothesis with the original paper: H3 :

Employees perceive that organizational communication will be positively related to their organizational commitment within their organizations.

Teamwork The teamwork is very important thing to make the organization more effective in providing quality of service toward the customers, especially for government organization which has the citizen as the customers. In order to adopt specific organizational values to facilitate the service quality and effectiveness of a

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professional service firm with successfully, the company should provide training, communication, rewards and resources (Burke, R.J., 1995; in Boon and Arumugam, 2006). A team may be viewed as a group of individuals who work interdependently to solve problems or accomplish tasks (Gibson and Kirkman, 1999; Manz and Sims, 1993 in Park, et al., 2005). Teamwork facilitates the meeting of affiliate needs within the workplace and has been directly connected to organizational commitment (Karia and Ahmad, 2000; Karia and Asaari, 2006; in Boon and Arumugam, 2006). Typologies of teams in contemporary organizations include work teams, parallel teams, project teams, and management teams (Cohen and Bailey, 1997 in Park, et al., 2005). Teamwork was found to be a significant predictor of teacher team commitment. Respondents showing higher levels of teamwork skills perceived higher levels of team commitment (Park, et al., 2005). According to McCabe and Garavan (2008), teamwork has positively influence toward commitment in the context of nurses. The study was conducted by Powell, et al., (2006), show that how much more important perceptions of member efforts and team work processes are to the creation of trust, and ultimately commitment, in different team types. Therefore, we propose the similar hypothesis with the original paper: H4 :

Employees perceive that teamwork will be positively related to their organizational commitment within their organizations.

The above review indicates that corporate culture dimensions significantly impact employees’ organizational commitment. We have chosen to examine the relationship between corporate culture dimensions and employees’ commitment specifically within Civil Government Organization because of the limited amount of research in this area.

3

Methodology

Sample and Survey Procedures The target population of this study was the civil government sector in Indonesia, specifically in Bandung city. Data collection for this study began in March 2006 and ended in early May 2006. The data for this study was collected through a self-administered questionnaire by the researchers. The questionnaire was divided into two sections, section A, and B. Section A comprised of 21 statements designed to gather the information of corporate culture from the respondents, Section B comprised of 8 statements of organizational commitment and Section C comprised questions eliciting respondent’s profile, but I didn’t include the position and length of service variables in this section. Due to limitation, I conducted this study on the basis of convenience sampling, I spread the self-administered questionnaires toward all employees of civil government in Bandung, and I was ignored the department where they work with. I were spread out 250 questionnaires, a cover letter explained the purpose of this study, assured the employees of confidentiality, and provided instructions on how to complete the questions. Only 166 questionnaires were returned, 150 questionnaires were usable but 16 questionnaires were incomplete answered, yielding a response rate of 60%. I also provided the respondent’s profile, so later I could test whether the social variables influence toward the employees’ organizational commitment. I was spread the questionnaires to the employees that have been worked for this company more than 3 years, although they were contract employees. The civil government organization consist from many institutions below that organization in each city that reside in every province in Indonesia, we focused in Bandung city for this research. Bandung city itself is part of West Java Province, south-east side from Jakarta (the capital of Indonesia). Bandung has more than 5789 street names. The organizational structure of Civil Government in Bandung led by Mayor, consist of regional secretary, expert staff, regional company, inspectorate, 12 regional technical institutions, 14 regional offices, 3 departments of government assistant, 4 departments of economic and development’s administration assistant, 4 departments of general administration assistant, secretariat of regional parliamentary, 30 districts, and 151 sub-districts.

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The reason of choosing this organization as my research object because like I said in previous section that the civil government is considered to be the public servant that has to give the best service toward citizen; therefore corporate culture is strategically and tactically important for gaining high performance that encourages the citizen’s satisfaction.

Variable Measurements Independent Variables: Corporate Culture Dimensions The Corporate Culture’s assessment was based on the four dimensions of corporate culture developed by Lau and Idris (2001) in Boon and Arumugam (2006). The items of questionnaire were added by researcher; I combined them with the related items from Entrepreneurial Orientation Survey (EOS) which was developed by Thornberry (2006). Therefore the four dimensions, which consist of training and development, rewards and recognition, teamwork and organizational communication, have 21 statements. These dimensions of corporate culture have been selected because they have previously been identified as those likely to have the greatest effects on employee behavior and attitudes (Boon and Arumugam (2006); Lau and Idris (2001) in Boon and Arumugam (2006). Sample items of questionnaire were included in Table 1. Responses to these items were measured on a 5-point Likert scale from 1 = “strongly disagree” to 5 = “strongly agree.”

Dependent Variable: Employees’ Organizational Commitment The Organizational Commitment was measured by a five-point scale adopted from Mowday, et al. (1979); Guess (1997) in Boon and Arumugam (2006), suggested that organizational commitment should be measured using the standard measure developed by Mowday, et al. (1979)—the organizational commitment questionnaire (OCQ)—because this scale captures the extent to which the employees identify with the organization, their desire to remain in the organization, and their willingness to exert effort on behalf of the organization (Edger and Geare (2005) in Boon and Arumugam (2006); Joiner and Bakalis (2006). The Organizational Commitment Questionnaire has 15 items, six of which are negatively phrased, but after we conduct a confirmatory factor analysis, only 8 items that valid and reliable. The internal consistency reliability coefficient for the scale was 0.921.

4

Result and Discussion

Analyses of Data Initially, I did factor analyses for reducing the items of questionnaire that are not valid and reliable with the constructs. Descriptive statistics such as mean, standard deviations, reliability coefficients, and intercorrelations were computed to understand the variability and interdependence of the subscales derived from the factor analyses. The hypotheses were tested using hierarchical regression. Because previous researchers (Lum et al., 1998; Guest, 1999; Ghiselli et al., 2001; Hemdi and Nasurdin, 2005; in Boon and Arumugam, 2006; Joiner and Bakalis, 2006) have noted that age, gender, marital status, education, and organizational tenure (social variables) may influence organizational commitment, these variables were controlled in the statistical analyses.

Profile of Respondents There were 42 females (28%) and 108 male respondents (72%). Among the respondents, 39.4% were aged less than 35 years, 60.6% were over 35 years. The respondents consisted of a rather old population, 85.9% of the respondents were married, and 43% had achieved at least college degree.

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Factor Analysis and Scale Reliabilities A principal component factor analysis with varimax rotation was conducted to cluster the variables in Section A and B of the questionnaire into several factors (see Table 1). In order to control the number of factors extracted, a minimum Eigen value of one (1) was used in the factor analysis that explained 80.681% of the variance. Factors with Eigen value less than one were considered insignificant and were excluded. Varimax orthogonal rotation was then used to group variables with large loadings (correlations) for the same factors so that each factor will be represented by a specific cluster of variables. Varimax rotation would ensure that the factors produced are independent and unrelated to each other.

Table 1.

Factor Analysis and Scale Reliabilities – Independent Variables (N = 150)

Variables Training and Development

Reward and Recognition

Teamwork

Organizational Communication

Items •

Employees are encouraged to accept education and training within the company • Resources are available for employees’ education and training within the company • Most employees in this company are trained on how to improve performance • Specific work-skills training are given to all employees • The company’s compensation system encourages team contribution • The company’s compensation system encourages individual contributions • Reward and Recognition system within the company rewards relationship and task accomplishments based on work quality • All suggestions are appropriately rewarded in cash and kind • Employees’ rewards are clearly communicated • Employees’ penalties are clearly communicated • Formally rewards cross-functional cooperation • Has very few interdepartmental barriers • Encourages cross-functionality discussion and problem solving • Rotates employees through different functions as a part of a formal employee development process • I am more comfortable working in a team rather than individually • In this company, workplace decisions are made through consensus • Management regularly provides customer feedback regarding the important things related to improve services toward citizen • Teamwork often conduct face to face meetings between team members to discuss the important things related to company successful or to improve service toward citizen • Continuously improve communications between management and staff is stated as an important company objective and is being practiced. • The company employees’ communication is effective in communicating things that are relevant to them • The company has departments which willingly share ideas and information with each other Eigen values Percentage of Variance Explained KMO Measure of Sampling Adequacy Approximate Chi Square

Factor Loading

A Set of Items

Reliability

0.833

4

0.931

0.886 0.845 0.754 0.896

7

0.941

5

0.875

5

0.916

0.856 0.912 0.817 0.904 0.886 0.747 0.570 0.903 0.892 0.856 0.853 0.922 0.927

0.907

0.857 0.711 3.227 80.681 0.813 454.287

In addition, substantial and significant factor loadings provide evidence of convergent validity (Steenkamp, et al (1991); Supranto (2004).; and Nasurdin, et al., 2009), with the threshold value of >0.30. As shown in 162

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Table 1, all of the items loadings were significant and well above the acceptable cut-off-point, signifying the convergent validity of the study variables. The Bartlett Test of Sphericity is significant (Chi square = 454.287, p < 0.001) and the KMO measure of sampling adequacy is 0.813, greater than 0.6 (Kaiser, 1960; Yusof, et al., 2007; Boon and Arumugam, 2006), which was also found to be significant. These factors were confirm named training and development (4 items), reward and recognition (7 items), teamwork (5 items), and organizational communication (5 items). Thus, a model with four factors may be adequate to represent the data because the results of the analysis can be considered satisfactory, given that these factors exceed 60 per cent of the explained variance recommended in social sciences (Hair, et al., 1998). Similarly, another factor analysis was undertaken to see the dimensionality of the dependent variable, organizational commitment (Table 2). A single-factor solution emerged with Eigen value of 5.175, explaining 64.689% of variance in the data. The KMO measure of sampling adequacy was 0.898, indicating sufficient inter-correlations, while the Bartlett’s Test of Sphericity was significant (Chi square = 807.280, p < 0.001).

Table 2.

Factor Analysis and Scale Reliabilities – Dependent Variables (N = 150)

Variables Commitment

Items •

I am willing to put in a great deal of effort beyond that normally expected in order to help this organization be successful • I talk up this organization to my friends as a great organization to work for • I find that my values and the organization’s values are very similar • I am proud to tell others that I am part of this organization • This organization really inspires the very best in me in the way of job performance • I am extremely glad that I chose this organization to work for, over others I was considering at the time I joined • I really care about the fate of this organization • For me this is the best of all possible organizations for which to work Eigen values Percentage of Variance Explained KMO Measure of Sampling Adequacy Approximate Chi Square

Factor Loading 0.686

A Set of Items 8

Reliability 0.921

0.803 0.768

0.827 0.835 0.774 0.880 0.845 5.175 64.689 0.898

807.280

The reliability of the questionnaire was tested according to Cronbach’s Alpha measurements. The reliability coefficient (Alpha) of each element of corporate culture was as follows: training and development (0.931), reward and recognition (0.941), teamwork (0.875), and communication (0.916). The reliability coefficients of all the four elements of corporate culture were above 0.70, which concurs with the suggestion made by Nunnally (1978) in Boon and Arumugam (2006); and Nasurdin, et al., (2009).

Correlation Analysis: Relationships between the Variables The correlation matrix in Table 3 displays correlation coefficients between the four independent variables measured by using multiple-item scales. The correlation coefficients indicate the strength of the association between the variables. A coefficient is considered significant if the p-value is less than 0.05. There is significant correlation between all the independent variables, as listed in Table 3. Out of 10 correlations, all coefficients are larger than 0.3. There are no high correlations of 0.90 or above. Bryman and Cramer (1997) in Boon and Arumugam (2006) suggest 0.80 instead of 0.90 as the threshold. www.insikapub.com

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However, the highest coefficient of correlation found is 0.82, which is below the cut-off of 0.90 for the collinearity problem. Hence, collinearity and multicollinearity do not present data problems in this research (Hair, et al., 1998). Our results show that the dependent variable - employees’ organizational commitment was most highly correlated with organizational communication, with a coefficient of 0.521. This shows that organizational communication was perceived as a dominant corporate culture practice. The findings indicate that respondents who perceived a greater awareness of corporate culture dimensions exhibited more positive reactions towards organizational commitment. These results are consistent with Boon and Arumugam (2006).

Table 3.

Means, Standard Deviations, and Correlation of Corporate Culture Dimensions and Employees’ Commitment (N = 150) Mean

SD

Training and Development

3.40

1.10

1

3.29

1.04

0.820**

1

Teamwork

3.29

0.90

0.665**

0.741**

1

Organizational Communication

3.24

1.02

0.697**

0.743**

0.786**

1

Commitment

3.13

0.95

0.342**

0.418**

0.459**

0.521**

Training and Development Reward and Recognition

Reward and Recognition

Teamwork

Organizational Communication

Note: **Correlation is significant at p < 0.01 level (2-tailed)

Multiple Hierarchical Regression Analysis The research hypotheses were tested using a multiple hierarchical regression analysis, which can be used to analyze the relationship between a single dependent (criterion) variable and several independent (predictor or explanatory) variables with the social variables at one time. The analysis showed the relationship between variables in two steps. First, respondents’ characteristics (social variables) were entered into Step 1 as controlling variables. Second, corporate culture dimensions were entered into Step 2 as response (predictor) variables (main effect). Organizational commitment was used as the dependent variable in the regression analysis. Table 4 provides the summary of the results. From Table 4, the excluded variables are all significant and positive relationship with organizational commitment. It can be seen that five control variables explained 7% of the variation in organizational commitment (F change = 2.561, p < 0.01), which were only marital status and education found to be significant (5% significance level) toward organizational commitment. When the model variables (corporate culture dimensions) were added into Step 1, only education and organizational communication were significant (1%) toward organizational commitment, the additional variance explained was 26.9% (F change = 13.496). It shows that education and organizational communication perceived as dominant influence toward organizational commitment. The Durbin–Watson of 1.824 falls within the acceptable range (1.679 < D < 2.321), indicating that there is no autocorrelation problem in the data and that the error term is independent (Durbin-Watson Significance Table). The five control variables (Step 1), marital status (β = -0.213, p < 0.05), and education (β = 0.139, p < 0.1) were found to significantly impact organizational commitment. In terms of marital status (dummy coded: 0=”not married”; 1=”married”), had a significant and negative relationship with the organizational commitment. The extent to which an individual depends on one’s income would influence the extent to which an employee feels locked into an organization and therefore employees with greater kinship responsibilities would be more reliant on the organization to fulfill their financial needs (Angle and Perry, 1983; Iverson and Buttigieg, 1999 in Joiner and Bakalis (2006). According to this theory, respondents who 164

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are married and who have greater family responsibilities (e.g. more children) would more likely have higher levels of affective and continuance commitment, but in my findings the respondents with the single status are more commitment than the respondents with marital status, it is consistent with the work/ family conflict literature (Byron, 2005 in Joiner and Bakalis, 2006), academics with increased family obligations may choose to resolve their conflict by choosing to favor family needs first over organizational needs (Iverson and Buttigieg, 1999 in Joiner and Bakalis, 2006). Kinship would, therefore, have a negative association with commitment.

Table 4.

The Summary of Multiple Hierarchical Regression Analysis for Cultural Dimensions and Social Variables and Their Association with Employee’s Commitment.

DEPENDENT VARIABLE Step 1 Step 2 Beta T Sig. Beta T Sig. SOCIAL VARIABLES (CONTROLING VARIABLES) -0.019 -0.224 0.823 -0.092 -1.256 0.211 • Gender -0.019 -0.216 0.829 -0.102 -1.344 0.181 • Age -0.213 -2.498 0.014** -0.075 -0.988 0.325 • Marital Status 0.139 1.659 0.099* 0.139 1.905 0.059* • Education RESPONSE VARIABLES -0.094 -0.723 0.471 • Training and Development 0.199 1.364 0.175 • Reward and Recognition 0.066 0.517 0.606 • Teamwork 0.394 3.075 0.003** • Organizational Communication Note: Significant correlations = *p < 0.1 (2-tailed); **p < 0.05 (2-tailed). EXCLUDED VARIABLE Beta ln t Sig. 0.385 4.798 0.000** • Training and Development 0.464 5.969 0.000** • Reward and Recognition 0.454 5.959 0.000** • Teamwork 0.524 7.143 0.000** • Organizational Communication SUMMARY R Squared 0.070 0.338 Adjusted R2 0.042 0.298 Sig. F Change 0.041* 0.000** R2 Change 0.070 0.269 F Change 2.561 13.496 Durbin-Watson = 1.824 Note: Significant correlations = *p < 0.05 (2-tailed); **p < 0.001 (2-tailed) INDEPENDENT VARIABLES

On the other hand, education had a significant and positive relationship with organizational commitment. This suggests that employees who had higher educational level will have higher organizational commitment compared to whom with a lower educational level. Even though the employees with higher education have more the opportunity to fulfill their financial needs from other resources, but they will maintain to stay in the organization, because in the context government organization, employees not just pursue the money but they also pursue the careers/ job position. Besides they will maintain to stay even they have higher education because they also pursue the pension money in the old period. The results indicate no multicollinearity problem (see Table 5): the multicollinearity statistics show that the tolerances for all elements of corporate culture are greater than 0.1 and that the Variation Inflation Factors (VIF) is all less than 10 (Hair, et al., 1998). Histogram and normal P-P plots of the standardized residuals also indicate normality of the error term, while a scatter plot shows consistent variance of error terms (homoscedasticity). A partial regression plot indicates linearity of the relationship between independent and dependent variables. From these analyses, it can be concluded that the multiple regression analysis model www.insikapub.com

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generated in this study meets the five assumptions required to ensure validity of its significance test (Hair, et al., 1998). Thus, there is a statistically significant relationship between corporate culture dimensions and employees’ organizational commitment.

Table 5. The Collinearity Statistics of Multiple Hierarchical Regression Analysis for Cultural Dimensions and Social Variables and Their Association with Employee’s Commitment. (Dummy coded). COLLINEARITY STATISTICS TOLERANCE VIF Step 1 Step 2 Step 1 SOCIAL VARIABLES (CONTROLLING VARIABLES) 0.966 0.918 1.035 • Gender 0.915 0.861 1.093 • Age 0.936 0.871 1.068 • Marital Status 0.966 0.941 1.036 • Education RESPONSE VARIABLES 0.293 • Training and Development 0.234 • Reward and Recognition 0.307 • Teamwork 0.303 • Organizational Communication EXCLUDED VARIABLE TOLERANCE VIF 0.908 1.101 • Training and Development 0.896 1.116 • Reward and Recognition 0.934 1.071 • Teamwork 0.923 1.084 • Organizational Communication INDEPENDENT VARIABLES

Step 2 1.089 1.162 1.148 1.063 3.417 4.275 3.253 3.305

The results also indicate that the four dimensions of corporate culture— training and development (β ln = 0.385, p < 0.001), reward and recognition (β ln = 0.464, p < 0.001), teamwork (β ln = 0.454, p < 0.001), and organizational communication (β ln = 0.524, p < 0.001)—are positively associated with employees’ organizational commitment. Therefore, it can be argued that all these dimensions of corporate culture are directly involved in improvements in employees’ organizational commitment. Moreover, the findings also indicate that the most important corporate culture dimension that explains the variance in employees’ organizational commitment was communication, which was significant at the 0.003 (p < 0.05) levels. Thus, hypotheses H1, H2, H3, and H4 are supported.

Discussion The overall objective of this study was to investigate the influence of four dimensions of corporate culture on employees’ organizational commitment within the context of civil government sector in Bandung-Indonesia. The results of this study reveal that employees’ perceptions of the four dimensions of corporate culture are positively related to employees’ work commitment, with those perceiving a greater degree of awareness of corporate culture dimensions exhibiting the more positive reactions towards their commitment. The results indicate that communication was perceived as a dominant dimension of corporate culture since there was a strong association with employees’ organizational commitment. This study is consistent with previous research which found that communication is important for improving employee commitment (Boon and Arumugam, 2006). However, the findings also indicate the importance of training and development, reward and recognition, and teamwork, for predicting employees’ organizational commitment. For instance, from management’s point of view that providing the training can be saves time and enables employees to do the right thing, thereby increasing their productivity and efficiency and as the way of engaging their employees’ commitment, and it

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was consistent with the studies conducted by Heyes and Stuart (1996) in Soltani and Liao (2010) and Bartlett, (2001). Reward and recognition were found to have significant contributions towards employees’ organizational commitment. This indicates that both recognition and rewards have motivating effects on people at work and their intention to stay, and the context of government organization, recognition such as participating in decision making is determine their commitment at work, it is consistent with the studies conducted by (Chew and Chan, 2008; and Ladd, et al, 2006). Further, aspects of teamwork and communication were also perceived important by the employees, in order to make organization more effective and efficient in providing the quality of their service toward the citizens. These are consistent with Hooff and Ridder (2004), that communication climate is found to be a key variable, a constructive communication climate was found positively influence knowledge donating, knowledge collecting, and affective commitment. And all those findings are consistent with the original paper (Boon and Arumugam, 2006).

Limitations and Future Research We realize that there are some limitations which must be considered for future research. Firstly, I excluded job tenure in this research that may be influence the organizational commitment, as Joiner and Bakalis (2006) did. Secondly, I was ignoring the department which they work with; perhaps each department will has different result of organizational commitment. Thirdly, since there are three types of commitment as proposed by Meyer and Allen (1991) in Parish, et al., (2008), which are affective, continuance, and normative commitment. It is better if each type of commitment will be analyze in the future research, so we would like to know the corporate culture in the context of government organization will have strong influence toward the specific type of commitment. Finally, it is also important that other major constructs related to entrepreneurial corporate culture dimensions (strategic planning, cross-functionality, support for new ideas, market intelligence, risk aversion, speed, flexibility, focus, and future) should be added to the conceptual framework underlying this study, as developed by Thornberry (2006). It is also proposed that future research should be added by other variables that influence toward commitment, such as leadership, because it is the crucial thing and interdependence with corporate culture.

5

Conclusions

In summary, this paper reports on an exploratory investigation of the relationship between corporate culture and employees’ organizational commitment within the context of civil government sector in Indonesia. The term of “commitment” is become the crucial thing in all organizations, because it is related with the sustainability aspect of those organizations. Further, it will determine the customers’ satisfaction of their quality of services. Therefore in order to engage the employees’ commitment, the management has to do several things to support those conditions, such as forming the supportive climate for gaining comfortable work environment. Several authors have examined the antecedents of organizational commitment, such as Boon and Arumugam (2006); Crawford and Lok (2001); Yiing and Zaman (2009), Organizational culture is one of the significant effects on employees’ attitude toward their commitment and maintains to stay in the organization. The study of civil government organizations revealed that employees’ perceptions of four corporate culture dimensions are positively related to their commitment, with those perceiving a greater awareness of these dimensions exhibiting the more satisfactory reactions towards their commitment. The most dominant effect of corporate cultures toward the organizational commitment is organizational communication. The findings are considered to have made a significant contribution by advancing the corporate culture literature to a better understanding of the influence of corporate culture contexts on commitment among employees in the civil government sector. www.insikapub.com

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In addition, the findings determine potential implications for top management in the civil government organization as a whole, to review their corporate culture dimensions, consistent with the needs of their employees, such as training needs, reward and recognition needs, and removing the barriers if their employees are motivated to continue their education to high level. Hence, employees will be more likely to perform better and to feel a higher level of commitment towards the organizations. To the best of the authors’ knowledge, this is the first study that examines the association between corporate culture and employees’ organizational commitment within the civil government work environment in BandungIndonesia.

Acknowledgments The paper has been presented at Indonesia International Conference on Innovation, Entrepreneurship, and Leadership (IICIES), 13-15 July 2010, Serpong - Indonesia

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