Crystal Marie T Tanigue

Organizational Culture and Performance in Southeast Asia As the global market becomes more and more competitive, combined with the increasing awareness of the fundamental relationship between an employees motivation and their performance, many companies are looking for ways to ensure that they can remain competitive by being attractive to the right candidates and be able to offer a productive environment in which employees can thrive and perform at their best. One key component that continues to emerge in research as critical to employee thriving is that of the culture within the organization. Research about organizational behavior concerns itself with developing tools, policies and observations in order to improve the ability of both workers and the organization to thrive at achieving their respective goals. As globalism is a continually expanding reality, with many work teams including members from multiple cultures, it is important to understand if the concepts of organizations, culture and performance are held constant across nations. This is done in the effort to provide tools that can allow and account for individual differences that may impact performance and well-being. Limiting itself to research performed in the years from 2017 to the present, this paper examines six studies done in South East Asia investigating the relationship between culture and performance in local organizations, both private and state owned, to observe if there are similar or dissimilar patterns in the research. Definitions of Culture Culture can be defined as a shared system of meaning regarding the beliefs and behaviors considered acceptable and rewardable within an organization. There are seven different domains that are considered as comprising the overall culture. These domains include varying degrees of innovation and risk taking, outcome orientation, team orientation, attention to detail, people orientation, stability and aggressiveness (Robbins & Judge, 2017). All of these domains exist on a scale of either low emphasis or tolerance to high emphasis or tolerance. The culture can be communicated explicitly, through relics, artwork, history, or implicitly through passive approval or punishment for behaviors that do not fall into the expected. Culture has been stated to be important as it is used as a beacon for employees to identify which organization is most suited to them. In the ASA model, when individuals feel represented by their organization this supplies a sense of belonging that can serve as an intrinsic motivator for improved performance. Indeed, the model of culture can vary within an organization based on teams and job functions. For instance, in an organization, it is imagined that the culture of the creative department might be different than that of the legal department. Frequently, it is seen that the burden of bringing the organizational culture to life every day rests on the shoulders of the managers of the relative “subcultures”. Definitions of Organizational Culture What can be immediately observed is that, similar to their western counterparts, throughout the reviewed literature there is an inconsistency of definitions for the various terminologies used. While there is general agreement that culture behaves as a guideline to what behavior is acceptable within the organization, there are differences on the nature of that guidance and the domains that culture must be built on. According to Daud (2020), organizational culture dictates the behavior of the employees, and is considered as a guide for organizational activities. Further, the study of Diana, Supriyanto, Ekowati, & Ertanto, (2021) suggests that organizational culture is a set of values, beliefs, and ways of carrying out activities in an organization. They also added that organizational culture can also be a method in differentiating one organization from another. Lolowang, Troena, Djazuli, & Aisjah (2019) agreed that organizational culture is a factor in distinguishing members of certain organizations from the members of other organization. They also mentioned that organizational culture is a set of values and norms, which are applied as a guideline in determining certain belief, behaviors, and skills for the members of an organization in performing their work. Meanwhile, Padhi (2017) defined organizational culture is rather a control mechanism, that can only exist after a long time of having been in place. This would suggest that longevity is required to communicate the values. He also divided organizational culture into two major aspects: 1) material aspects include products of industry, technology, art, and are directly observable; 2) non-material aspects of culture such as knowledge, philosophy, morals, languages, motivation, attitudes, values, and norms shared and transmitted in a society. Further, Achmad (2016) defined organizational culture as a way of organization life generated through alternation of generations of employees, which also suggest longevity as a requirement. He also mentioned that organizational culture refers to values, assumptions, attitudes, and norms of behavior that have been institutionalized then manifested in appearance, attitude and action, which characterize the identity of a particular organization. According to Fithriana & Adi (2017), organizational culture is the values contained and disseminated within the organization, referred to as work philosophy of employees, agreed and shared, meets the elements of future orientation, authority distribution, avoiding uncertainty, gender equality, humanitarian orientation, social practice, social values, organizational practices and organizational values. Definition of Performance Daud (2020) defined employee performance is the achievement of one’s work as measured by the criteria set by the organization. In addition, he suggested that to maintain or improve the performance of human resources is to evaluate employee performance continuously and motivate employees to improve their performance and achieve organizational goals. Meanwhile, according to Diana, Supriyanto, Ekowati, & Ertanto (2021), performance as the result of work that can be achieved by employees of an organization both individually and in groups. It is associated with the overall period in carrying out a task compared to various possibilities, such as work standards, targets, or criteria that have been mutually determined in advance. The intended performance is the achievement of an employee both individually and in groups within a specified period and following the planned organizational goals. Further, Fithriana & Adi (2017) defined employee performance as the result of the skill and expertise of an employee indicated from the job, task performance, productivity, maximum effort, affective commitment, commitment to sustainability, and level of work climate. On the other hand, in the study of Lolowang, Troena, Djazuli, & Aisjah (2019), they defined performance as employees’ achievement in doing his/her work which supports success of the company. Indicators for performance in this study are: quantity and quality of work, persistence and work durability, discipline/presence, teamwork, awareness on work safety, responsibility of the work, and initiative. Impact of Organizational Culture to Performance Daud (2020) concluded that there is a significant influence between organizational culture and performance. This is mainly because as stated in his definition of organizational culture, it is the essence of what is important in the organization as it dictates what can and cannot be done that will regulate the behavior of its employees. This conclusion is supported by the study of Diana, Supriyanto, Ekowati, & Ertanto (2021), as they suggested that a better organizational culture has the ability to improve the perfromance of both individuals and organizations. According to them, this “better” organizational culture has the ability to improve the performance of both individuals and organizations. This can be done by sharing things such as uniforms to create discipline and carrying out social service work at least once a month to positively impact employees in terms of cooperation and harmony within an organization. According to Fithriana & Adi (2017), organizational culture has the most positive and significant influence on employee performance than compensation and leadership styles. This implies that an organization needs to direct and instill social values in work culture, job description in detail, short-term and long-term goals of the organization, as well as targets to be achieved more intensively. In the study of Lolowang, Troena, Djazuli, & Aisjah (2019), they concluded that strong organizational culture results in good employees’ performance and job satisfaction. “Strong” organizational culture in this study pertains to the behavior of organizational members in carrying out work that supports organizational goals. This also pertains to a favorable and conducive work atmosphere that enhances the work commitments and improves the discipline in performing the work which appears to be the basic necessities and expectations of the members of an organization. According to Padhi (2017), organizational culture has a significant effect on employee performance as organizational culture is a requirement that must be owned by leaders to generate a favorable condition of employment. In addition, this favorable condition of employment produce a harmonious work environment and has two positive impacts: 1) closeness between employees and leaders can result to a quick resolution of issues or complaints from employees; 2) employees feel valued and appreciated because they rarely get this kind of treatment by the top management. However, Padhi (2017) concluded that there is no relationship between organizational culture and productivity. Instead organizational climate and leadership styles have a strong and positive relationship to employee performance. This implies that leadership styles can affect the perception of organization climate amongst the employees and organization climate has direct impact on employee performance. Improvement on leadership styles and perception of the organization climate would lead to a better employee performance. Padhi (2017) also observed that work processes and organization values have a positive relationship to employee performance which implies that a well-managed organizational values, work processes and system would significantly improve employee's job performance. Leadership and Performance According to Fithriana & Adi (2017), leadership is a form of influence on others through name, charisma, high self-consideration, and motivating through inspirational stories, intellectual stimulation, so as to encourage the creativity of others and align the interests of employees with the interests of the organization. They also mentioned that the leadership style that is most closely related to employee performance is charismatic leadership style. However, their study concluded that leadership has a positive but not significant effect on employee performance. Meanwhile, Lolowang, Troena, Djazuli, & Aisjah (2019) defined leadership as the use of authority while not coerción (non-coercieve) so as to form bound objectives or goups encourages the member of the cluster to attain those objectives and outline the group culture or organizational culture. Their study also concluded that leadership has no direct impact on employee performance instead it is able to strengthen employees’ motivation to work, which gives positive effect toward their performance. On the other hand, Diana, Supriyanto, Ekowati, & Ertanto (2021) suggested that a leader has a significant influence on employee performance in carrying out their duties and obligations. Their study also concluded that leaders’ actions have a major role in creating organizational culture. In particular, they highlighted democratic leadership style to have a possitive effect on organizational culture and organizational culture significantly affected employee performance. In a democratic leadership style, a leader encourages participation in decision-making and develops effective human relationships based on the principles of mutual respect among employees. In the study of Daud (2020), he concluded that a leader motivate their employees and create a sense of satisfaction in work to improve employee performance. Other Factors Influencing Employee Performance Daud (2020) highlighted that compensation and work motivation also influenced performance. Compensation includes the salary and benefits of the the employees from the organization. This also includes awards and gifts that the employees received as a form of appreciation for their work. Meanwhile, work motivation is the willingness and behavior of employees to achieve organizational goals. The study of Daud (2020) indicates that work motivation does not meditate the relationship between organizational culture and employee performance, while the relationship between compensation and employee performance is mediated by work motivation. Fithriana & Adi (2017) also added compensation to have an influence in employee performance. They defined compensation as a form of reward for employee performance in the hope of improvement of employee innovation and employee motivation from one period to the next period. Their study concluded that compensation can significantly affect the performance of employees from time to time. Lolowang, Troena, Djazuli, & Aisjah (2019) mentioned that employees’ work motivation as the mediating variable of the effect of leadership on employees’ performance. They defined motivation as a personal drive that leads someone to act and behave in certain ways to satisfy herself/himself and to live a life, which is directed in certain point to achieve certain goals. According to their study, it is apparent that the main goal in improving employees’ motivation to work is to grow employees’ willingness to work and behave in certain ways that will improve their performance. In the study of Padhi (2017), he also concluded that work motivation has a significant effect on employee performance. He defined motivation as how employees behave in achieving their objectives and the extent to which the of the employees’ behavior affects their work. It is important to take note that according to his study, motivation is the basic capital that should be owned by every employee to do a job, because employees who have high motivation may have a nearly perfect performance. This happens because an employee performing a job comes from himself as a self-encouragement, who has a commitment that he/she loves and lives the job so he/she will work sincerely. If the work environment is conducive, then the person will be working diligently and vigorously. Conversely, if the work environment is less supportive, then the person will be reluctant to work properly and responsibly. In addition, Padhi (2017), also added that competency also has a significant effect on employee performance. Competency is the employees’ abilities consisting of knowledge, skills and attitudes in order to complete a job or task that become their responsibility. Therefore, every employee should have required competency as an absolute requirement to be hold by every human resource. Because competency is one of the key aspects for an employee in making a good performance, competency also serves as a guide for achieving success collectively in predetermined organizational objectives. Conclusion Worth noting however is that within the varying definitions and domains, each author used existing literature upon which to build their hypothesis, either using definitions drawn directly from existing literature or drawing inspiration for definitions based on theories of existing works in the field. What this suggests is that the existing literature in the field is varied enough to supply multiple positions upon which to build. Therefore the differentiation of theories, definitions and domains is not a characteristic of the research done in the east but rather a characteristic of the field of study itself. Across six studies there was not a consistent set of terms of variables suggesting that there is still much work to be done in the field of research. Given the lack of consistency in the individual elements of evaluation, the body of research is difficult to use in comparison. It is interesting that in several studies, performance is considered the evaluation of the organization on the employees’ ability to reach certain determined goals. As with culture, there are varying definitions of what performance is intended to be. However, all of the surveys provided are self-administered so the evaluation of the performance rendered is not coming from the correct evaluating party. In order to examine if performance had indeed improved, the evaluations would need to be done by the representatives of the organization and not the employees. It is possible that the employees believed themselves to have performed properly whereas the organization did not. Further no cross-study comparisons can be done due to the lack of consistency across definitions. Performance in one organization is monitored differently than the other. Bibliography Achmad, S. H. (2016). The Effect of Competency, Motivation, and Organizational Culture on the Employee Performance at the Jayakarta Hotel, Bandung, Indonesia. Journal of Business on Hospitality and Tourism. Daud, I. (2020). The Influence of Organizational Culture and Compensation on Employee Performance with Work Motivation as a Mediating Variable . Journal of Management and Marketing Review . Diana, I. N., Supriyanto, A. S., Ekowati, V. M., & Ertanto, A. H. (2021). Factor Influencing Employee Performance: The Role of Organizational Culture. Journal of Asian Finance, Economics and Business. Fithriana, N., & Adi, A. N. (2017). Dominant Effect Between Compensation Leadership and Organizational Culture on Employee Performance Improvement. Journal of Applied Management (JAM) . Lolowang, N. L., Troena, E. A., Djazuli, A., & Aisjah. (2019). The Effect of Leadership and Organizational Culture on Employee Performance tharis Educated by Motivation (Study on the Implementation Empowerment Programs in Jayapura City). Problems and Perspectives in Management. Padhi, P. (2017). Organisational culture and Employee Performance . International Journal of Research in IT and Management (IJRIM).