Organizational and national cultures, employee attitudes, and management practices
Takashi Sakikawa／Professor, Faculty of Global Management, Chuo University
Research interests: organizational culture and cross-cultural management
National and organizational cultures are important as they both have an impact on organizations and their management practices. National culture is at a national or societal level while organizational culture exits within a company or other organizations. Organizational culture researchers have applied the concept of nation-level culture from anthropology or psychology to business organizations. Since organizations and their organizational cultures are nested or clustered within a nation and its societal culture, organizational culture may also be affected by national culture. Organizations may have organization-culture dimensions identical to national-culture dimensions. For instance, the national-culture dimension of power distance may be connected to the organization-culture dimension of power distance. However, as researchers such as Kwantes and Dickson (2001) argued, the relationship between national and organizational cultures is not as simple as believed. National culture develops as people of a society learn the skills and gain knowledge regarding a way of life (Dressler, 1969). Meanwhile, organizational culture develops as members of an organization learn to deal with issues concerning adapting to environments outside the organization and organizing people within the organization (Schein, 1985). It may be that organizational culture does not necessarily reflect national culture and that organizations do not necessarily have organizational-cultural dimensions identical or homologous to national-culture dimensions. Against a backdrop where the connection between national and organizational cultures has been discussed among management researchers over a long period of time but has not been fully understood yet, I conducted this research in order to respond to the following research questions: Are organizational cultures different among nations?; Are different types of organizational cultures, such as adhocracy, hierarchy, market, and clan, related to employee attitudes, more specifically, collective employee engagement (the extent to which individuals as an aggregate feel engaged in their work, secured, and connected with each other at the workplace)?; Do management practices, more specifically, high commitment work practices (e.g., a job security policy and off-the job training programs) and new work arrangements (e.g., teleworking and flexible working schedules) mediate the impact of organizational cultures on collective employee engagement?; Does the indirect effect of organizational culture on collective employee engagement through management practices, if there is any, vary among nations? In order to conduct my research, I collected data through the online system of a research company in February 2022. The data were collected from managers from Japan, the US, and the UK. This is because Japan is culturally different from the US and the UK in some ways. For instance, it is said that Japan is a collectivist society while the USA and the UK are individualist societies (House, Hanges, Javida, Dorfman, & Gupta, 2004). It is expected that such a difference of national culture explains a difference of organizational culture between Japan and the USA or Japan and the UK. I do not dwell on the theoretical foundations of this research due to the limitation of the number of words. See my recent work (Sakikawa, 2022) for details of the theoretical foundations.
I made the English and Japanese versions of questionnaire. I asked several scholars and a businessperson who can speak English and Japanese fluently to check both the English and Japanese versions of questionnaire. I revised and improved the questionnaire after I had received comments from those people and completed both the English and Japanese versions of questionnaire. One-hundred one Japanese managers, 110 UK managers, and 111 US managers responded to the survey questionnaire. A total of 322 managers responded to the questionnaire. The participating companies were in the automotive, electronics, food, information technology, service (e.g., tourism, hotels, restaurants, education, nursing care, and healthcare), and other manufacturing and non-manufacturing industries. It should be noted that the unit of analysis in this survey was the workplace, not an individual or a company.
In my research framework, independent variables are organizational cultures; the dependent variable is collective employee engagement; mediator variables are two management practices, more specifically, high commitment work practices and new work arrangements; moderator variables are two dichotomous, national dummy variables that contrast the USA with Japan and the UK with Japan; control variables are industrial dummy variables. I adopted all indicators (organizational culture, management practices, and collective employee engagement) from the prior literature. I modified some of these indicators that had been provided long years ago to be relevant to the ongoing business circumstances so thar the questionnaire items could be easy to understand and answer. All items were evaluated on a five-point Likert scale ranging from 1 "strongly disagree" to 5 "strongly agree." I performed confirmatory factor analysis (CFA) or exploratory factor analysis (EFA)for questionnaire items by each of the areas of organizational culture, management practices, and collective employee engagement in order to extract latent factors behind observable indicators.
Collective employee engagement. Respondents were asked to evaluate how much engaged in their work employees as a whole are. A sample questionnaire item is "Employees feel proud to be part of the company." Researcher cannot basically perform CFA with one-latent factor model constituted of three indicators since the model is just-identified and would always be a perfect fit (Brown, 2006). Thus, instead of CFA, I conducted EFA with the principal component method. I found that three observable indicators converged toward the one factor (eigenvalue=2.50, proportion=0.83). Internal consistency reliability among the three items was 0.90. I decided to use the average value of the three items as collective employee engagement.
Organizational culture. In my research framework, I used the four types of organizational culture presented by Cameron and Quinn (1999): clan, hierarchy, market, and adhocracy. The four types of organizational culture are characterized by their dominant values and behavioral patterns attributed to such values. I attempted to capture organizational culture in terms of behavioral patterns since cultural values are so abstract that it is not possible to distinguish cultural differences among organizations (cf., Hofstede, 2001). Clan organizations are team- and employee-oriented. Market organizations are individual- and task-oriented. Adhocracy organizations are change- and equity-oriented. Hierarchy organizations are stability- and control-oriented. Thus, I created indicators of team- versus individual-orientation, employee- versus task-orientation, change- versus stability-orientation, and control- versus equity-orientation. Sample questionnaire items are the following: "Employees avoid confrontation and maintain harmony." (team-orientation), "Employees like to try new things." (change-orientation), and "A person sitting at a high position makes decisions, irrespective of her or his qualifications (e.g., knowledge, skills, and experiences)." (control-orientation), and "Profits come first while employee wellbeing comes later." (performance-orientation). Since I captured each of these behavioral patterns as the continuum, I inversed original scores of some of the indicators such as a question: "Employees would rather act independently rather than depend on their colleagues." (individual-orientation). Then, I conducted CFA with a four-factor model. Since the result was not favorable, I used original scores of the indicators and performed CFA with an eight-factor model again. Since the result was not still favorable, I conducted EFA with promax rotation and extracted the four factors. I performed the four-factor model of CFA based on the result of EFA. Even though the four-factor model did not fully fit data according to a recommended cut-off thresholds for the model fit (Brown, 2006, p. 87) (χ2 = 662.13, df = 246, p < .01, CFI = .85, SRMR = .08, RMSEA = .07), the CFA result showed that indicators of organizational culture converged toward such four dimensions as Cameron and Quinn (1999) proposed. The first dimension includes all indicators I had created as aspects of employee-, change-, and equity-orientations. I would like to refer to the dimension as adhocracy culture. The second dimension basically includes indicators I had created as task- and control-orientations. I would like to refer to the dimension as hierarchy culture. The third dimension is largely composed of indicators I had created to capture individual-orientation. I would like to regard the dimension as market culture. The last and fourth dimension is largely composed of indicators I had created as those for team-orientation. I would like to refer to the dimension as clan culture. Each of the organizational-culture dimensions corresponds to each of the different types of organizational cultures. The internal consistency reliabilities were 0.86 for the eight items for adhocracy, 0.82 for the seven items for hierarchy, 0.71 for the five items for market, and 0.72 for the four items for clan. I used each average value of those items for each dimension of organizational culture as the variable of organizational culture. The CFA result indicates that each dimension of organizational culture is complicated since it is composed of single or multiple behavioral orientations. For instance, adhocracy is composed of employee-, change-, and equity-orientations. A reason my CFA result did not present a full fit-model might be that a dimension or type of organizational culture such as adhocracy is composed of a complex set of behavioral patterns.
Management practices. I selected and used high commitment work practices and flexible work arrangement among other management practices since I expected those practices to mediate the effects of organizational cultures on collective employee engagement. The sample questionnaire items are the following: "Job security of employees (the probability that they will keep their job) is almost guaranteed." '(high commitment work practices) and "Teleworking: Employees work from home or anywhere for some or all of working week by connecting to the workplace through an electronic device." (flexible work arrangement). First, I performed EFA with promax rotation and extracted the two factors. It seemed that the first factor and the second factor represent the dimensions of high commitment work and of flexible work arrangements, respectively. Then, I conducted CFA with the two-factor model (χ2 = 81.31, df = 19, p < .01, CFI = .92, SRMR = .05, RMSEA = .10). A reason the root mean square error of approximation or RMSEA is below the cutoff criteria of 0.06 (Brwon, 2006, p. 87) might be that the two-factor model has relatively small parameters with eight indicators. The reliability of the six question items for high commitment work practices was 0.82. I used and regarded the average values of the six management practice items as the index of high commitment work practices. The reliability of the two question items for flexible work arrangements was 0.73. I used and regarded the average values of the two management practice items as the index of flexible work arrangements.
Control variables. I used 12 industrial dummies as control variables. Industries included automotive, electronics, retail/wholesale, banking, and other manufacturing and non-manufacturing industries. The reference industry was the service industry and was coded as the value of zero and other industries were coded as the value of one against the reference industry.
Moderator variables. Moderator variables are two, dichotomous national dummy variables, with the USA and the UK being contrasted against a reference country of Japan. Thus, the USA and the UK were coded the value of one while Japan were assigned the value of zero.
I found differences in organization-culture dimensions of adhocracy, hierarchy, and clan among the UK, the USA, and Japan. Table 1 shows averages of the four dimensions of organizational culture among the three nations and F tests. Those differences in organizational culture among nations may attribute to differences in national cultures. Adhocracy organizational-culture is more common in the West, namely the UK and the US, than in the East, namely Japan. This may be because the national cultures of the UK and the USA are more open to change, more humane-oriented, and more egalitarian than the national culture of Japan. Hierarchy organizational-culture is more common in the UK and the US than in Japan. This may be because the UK and the USA are also more culturally hierarchical and performance-oriented than Japan. As I found correlations among four dimensions of organizational culture in my research, hierarchical and egalitarian cultures as well as humane- and performance-oriented cultures at the societal level may not be mutually exclusive. Market organizational culture is more common in the UK and the US than in Japan. This may be because the UK and the USA have more individualistic culture than Japan. It is said that Japan is a more collectivist society than in the UK and the USA (e.g., Hofstede, 2001; House et al., 2004). Assuming that collectivist and individualist cultures are not placed at the opposite ends of the continuum, I predicted that clan organizational-culture is more common in Japan than the UK and the USA. As opposed to my prediction, however, clan culture is not statistically different among the three countries. This may be that Japan is placed not on the opposite end of the individualism-versus-collectivism continuum in Hofstede's (2001) cultural survey, bur just on the right side to the middle point of the continuum; that is, Japan is a modestly more collectivist society compared to other nations.
Then, I analyzed the impact of organizational culture on collective employee engagement. It is said that organizational culture is related to several organizational and individual outcomes, such as productivity, sales, sales growth, profits, innovation, operational efficiency, and employee attitudes (Hartnell, Ou, & Kinicki, 2011). I selected employee attitudes among other organizational and individual outcomes. This is because employee attitudes are an immediate outcome of organizational culture; furthermore, although it is expected that clan organizational-culture is most related to employee attitudes, other types of organizational culture also have something to do with employee attitudes (Hartnell et al., 2011). I focused on collective employee engagement as one of the aggregated, positive employee attitudes since it is expected that not only organizational culture but also management practices, the variables of another interest in my framework, are related to collective employee engagement. I regressed collective employee engagement on each type of organizational cultures. The results are in line with my prediction: that is, adhocracy and clan cultures had a positive effect on collective employee engagement. Market culture also had a positive effect on collective employee engagement. Hierarchy culture did not have any significant relation to collective employee engagement.
Given that adhocracy, clan, and market cultures are related to collective employee engagement, I attempted to explore the mechanism in which these organizational cultures affect collective employee engagement. I predicted that management practices, more specifically, high commitment work practices and new work arrangements, can play a mediating role between organizational cultures and collective employee engagement. Building causal models, I attempted to reveal the indirect effects of adhocracy, clan, and market organizational-cultures on collective employee engagement through high commitment work practices as well as new work arrangements. My mediated regression analyses found the following causal relations that are presumed to exit within a 95% confidence interval: adhocracy culture affects collective employee engagement through high commitment work practices. Clan culture affects collective employee engagement through both high commitment work practices and new work arrangements. The indirect effect of clan culture on collective work engagement through high commitment work practices is significantly larger than that through new work arrangements. Market culture also affects collective employee engagement through both high commitment work practices and new work arrangements. The indirect effect of market culture on collective work engagement through high commitment work practices is significantly larger than that through new work arrangements.
I explored whether the indirect effects above mentioned vary contingent on different nations. The results of my conditional process analyses (see Hayes  for more information on conditional process analysis) showed that there were no differences in any conditional indirect effects between the USA and Japan or the UK and Japan within a 95% confidence interval (CI). However, when I relaxed the level of CI to 90%, I found that a difference between conditional indirect effects of clan organizational-culture on collective employee engagement though high commitment work practices exits between the USA and Japan. It is likely that the employees who are covered by high commitment work practices can boost their job engagement from such practices when they are from a collectivist society such as Japan. In order to increase the understanding of the mechanism in which clan-organizational-culture is related to collective employee engagement, I drew Figure 1. As Figure 1 indicates, the conditional indirect effects are different between the USA and Japan: the conditional indirect effect for Japan is larger than that for the USA.
My research found that nations can delineate the shapes of organizational cultures, suggesting that organizational culture can reflect national culture. Adhocracy, clan, and market organizational-cultures can affect collective employee engagement. Adhocracy culture affects collective employee engagement through high commitment work practices. Clan culture affects collective employee engagement through both high commitment work practices and new work arrangements. Market culture also affects collective employee engagement through both high commitment work practices and new work arrangements. Although the boostrapping test was performed with 90% confidence interval, the difference between conditional indirect effects of clan organizational-culture on collective employee engagement though high commitment work practices between the USA and Japan existed. The conditional indirect effect for Japan was larger than that for the USA.
The connections between national and organizational cultures have been long discussed but have not been enough understood. It is expected that the advancement of knowledge on such connections can increase the understanding of the nature of both national and organizational cultures. Researchers are called for to understand the connections between national and organizational cultures.
Note: This research study is funded by Japan Society for the Promotion of Science's (JSPS) KAKENHI Grant Number 20K01860.
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Takashi Sakikawa／Professor, Faculty of Global Management, Chuo University
Research interests: organizational culture and cross-cultural management
PhD in business administration from Aoyama Gakuin University
Organizational culture and innovation (in Japanese), Tokyo, Japan: Chikura Publishing Company, 1998.
Transforming Japanese workplaces, Hampshire, UK: Palgrave-Macmillan, 2012.