Organizational Culture, Work-Related Attitudes, Work Behavior, and Organizational Performance in Local and Multinational Companies in Egypt"

Walid Kamel El Leithy*

A solid and strong observed organizational culture is indispensable for organizations to achieve high economical and financial performance in a competitive environment as organizational literature shows. As such, gaining insights as to specifics of organizational culture is of importance for practitioners and academics alike. Indeed, literature concerning organizational culture highlights its importance, defines its types, develops its diagnostic tools, and spells out its association with other variables, mainly organizational performance. Literature, however, doesnt cover all aspects of organization culture. In this regard, this study contributes to the literature concerning organizational culture by investigating different types of corporate cultures observed in both local and multinational firms coexisting within the same national setting, identify which culture types are more dominant, and empirically uncovering the impact different culture types have on organizational performance. On other words, the exposition of this study aims at testing differences and similarities between both local and multinational companies operating in Egypt with regards to diagnosing the most dominant culture type existing in both types of companies, testing the significance difference and similarity between the dominant type of culture found , testing the differences and similarities between both types of companies in terms of work related attitudes, work behavior, organizational performance. The findings of this study show the following: The dominant type of corporate culture in both local and multinational companies operating within the Egyptian setting is the same (The Clan Culture). Since results show that culture is the same in both local and multinational companies, this means that culture is not a reason behind any performance's distinction from one side, and that we should think of other reasons like leadership style, strategies and so on and so forth. Meanwhile, this result clearly shows the effect of national culture on corporate culture. Despite the similarity between both local and multinational companies in terms of the dominant type of corporate culture, yet, its strength is different, as the Clan culture is stronger in local companies than in multinational, which is a logical result due to the local companies' nature.

*Author: Walid Kamel El Leithy, M.A., M.PHIL, FCMI, Maastricht School of Management, the Netherlands. Address: 15, Abu El Sorour St., Heliopolis, Cairo, Egypt. Email address: walid.elleithy@gmail.com

There is a significance difference between job satisfaction responses, job involvement responses, job performance and organizational performance responses, while, there is no significance difference between organizational commitment, turnover intention responses and voluntary absenteeism responses in both local and multinational companies' study sample.

Field of Research: Organizational Behavior

1.1 Introduction
Organizational culture attracts the attention of academics and practitioners alike. A form of organizational capital (Kaliprasad 2006), organizational culture is an organization's beliefs, attitudes, and behaviors that collectively define its values (Miller, 2004). Organizational culture, therefore, is one of the key components influencing an organization's ability to compete and succeed in both short and long terms (Kotter and Hesket, 1992). In this respect, organizational culture is a widely accepted, however not universally interpreted phenomenon in an organizational setting (Cameron & Quinn, 1999). Furthermore, according to (Burt et al., 1994), the role of organizational culture is to coordinate employee efforts through an informal control mechanism that clarifies a firms goals and practices. In the presence of an organizational culture, employees will have no uncertainty about what they should act and do with regard to different situations and problems they might face and, thus, will be able to respond to different events and circumstances more effectively. That is, organizational culture imparts a code that employees refer to when it comes to aligning their efforts with the objectives of their organizations (George et al., 1999).

1.2 Study Objectives

Diagnosing, and describing the most dominant culture type existing in both local and multinational companies in the Egyptian market. Testing the significance difference and similarity between the dominant type of culture found in both local and multinational companies in the Egyptian market. Testing the differences and similarities between both local and multinational companies in terms of work related attitudes, work behavior, organizational performance.

1.3 Study Questions

What is the most dominant organizational culture type existing in both local and multinational companies in the Egyptian market? Is their significant difference (similarity) between the dominant type of culture found in both local and multinational companies in the Egyptian market? Is their significant difference (similarity) between the strength of the dominant type of culture found in both local and multinational companies in the Egyptian market?

Are their significant differences (similarities) between both local and multinational companies in the Egyptian market in terms of work-related attitudes, work behavior and organizational performance?

2. Literature Review
According to Cameron & Quinn (2006), each culture enjoys a unique language, symbols, rules, regulations and feelings that are different from that of other cultures. Such culture might also be different inside same organizations through different sub occupational, religious, educational or social groups that their differences represent sub cultures; yet, each of those subcultures contains common attributes of the dominant type of culture of the entire organization. Similarly, Thompson and Strickland (1987), confirm that every organization has a unique culture represented in its unique history and style of management, its own ways of addressing and solving its problems and conducting activities, its own established patterns of "how we do things around here ", its own legendary set of war stories and heroes, its own experiences and its unique organization personality. Meaning that every organization has its unique finger print that tries to apply on its existing employees and set it as the base of recruiting and hiring criteria. Schermerhorn, et al. (2004), as well argue about the uniqueness idea of organizational culture and state that just as no two individual personalities are the same, no two organizational cultures are identical. Yet, Denison (2000) believes that If all managers and scholars believe in the uniqueness of organizational cultures, this means that outcomes of researches that indicate the type of dominant organizational cultures found in most successful companies, cannot be either studied or used by other organizations. On the other hand the idea of culture change and all studies related and successful attempts will be impossible. According to Dennison, even if there are many aspects of organizational cultures that cannot be compared, when the objective is to use culture as a lever for change, it is important to begin by focusing on aspects of culture that can be compared. In this sense, according to Harrison & Stokes (1992), culture shapes both beliefs and attitudes of all organizations members and accordingly their behavior and most importantly their performance. It influences the whole organizational life, in terms of the way decisions are taken, the recruitment, promotion and awarding systems and the external systems in general. How people are treated internally, how customers are treated externally, and how organization responds to its environment. In general it influences each and every internal aspect as well as external responses. Culture to an organization is what personality is to an individual. It is that distinctive collection of beliefs, values, work styles, and relationships that distinguish one organization from another.

3.1 Study Sample

Population of this study includes both local and multinational companies' employees and managers located in Cairo. Yet, due to the difficulties the researcher has found for applying his study on a certain sector, thus he has been obliged to include all local and multinational companies located in Cairo. Furthermore, the researcher could not find an

official source of information whereby he could indicate the total number of population which he considers unknown. Therefore, the researcher has approached 70 different local and multinational companies in Cairo, where 14 among them (10 local companies and 4 multinational companies) agreed on participating in this research. Moreover, the researcher has adopted Cochran (1963) sampling size equation for large populations, which is the case of this study. Cochran (1963) developed an equation to yield a representative sample for proportions as follows:

View of the above, and due to the estimated large number of study population (all employees in both local and multinational companies located in Cairo) the researcher has adopted the practice with regards to large population, therefore he has assumed p=.5 (maximum variability), a 95% confidence level and 5% precision. When calculating the study sample size based on Cochran's (1963) sampling size equation for large populations, the sample size of this study has been determined by the hereunder equation:

Thus the sample size of this study has been determined based on the above equation to be 384 respondent gathered from 14 companies (10 local and 4 multinational) where a random stratified sample applied that included (clerks-supervisors-middle management-senior management). The share of local respondents has been estimated to be 75% versus 25% of the multinational respondents. This is based on the researcher's practical and professional experience. Same has been applied while determining the share of every stratum that the researcher assumes to be 60 % employees and senior employees, 20% supervisors, 15% middle managers and 5% senior managers. However, due to the Egyptian Revolution that took place in the 25th of January, 2011, the researcher decided to include only the number of questionnaires that were collected before the 25th of January 2011, (The Egyptian Uprising or Revolution), which is 310 questionnaires, and thus the study's sample size has been modified to be 310 respondents instead of 384 respondents to avoid the impact of the Egyptian Revolution as a historic event on the rest of respondents' responses and outcomes. Meanwhile 17 respondents have been eliminated due to un-complete questions, thus the final research sample has become 293 respondents.

3.2 Data Collection

1- The competing value frames developed by Quinn and Rohrbaugh (1983) has been used to assess the organizational culture dominant type, as one of the most known and wide used by many researchers. 2- The Job Satisfaction Survey (JSS) by Paul E. Spector (1997) has been used. The JSS assesses nine facets of job satisfaction (Pay, Promotion, Supervision,

3-

4-

5-

6-

7-

8-

Fringe benefits, Contingent rewards, Operating conditions, Co-workers, Nature of work Communication) as well as overall satisfaction. Meyer and Allen's (1997) organizational commitment scale has been used. This scale consists of 3 sub scales; 1- Affective commitment scale item that includes 8 statements, 2- Continuance commitment scale items that includes 9 statements, and 3- Normative commitment sale items that includes 6 statements. Response to each item is made on a 7 Likert scale point ranging from strongly disagrees to strongly agree. Kanungo's (1982) job involvement scale has been used. This scale was developed to fix the problem of old scales that could not distinguish between job involvement and work involvement in general. The researcher has designed a questionnaire based on Meyer and Allen (1997) studies and results to measure voluntary absenteeism variable. Meyer and Allen believe that to determine an employee's absenteeism rate, you ask him/her to provide two estimates of absenteeism: a) total number of days in which he/ she were absent and b) number of absent days because the employee "did not feel like going to work". They believe that the second estimate is a more direct measure of voluntary absence. The researcher has designed a questionnaire to measure turnover intention variable based on Blau (1993) studies and results. Blau confirms that job satisfaction correlates quite well with intention of quitting the job. He believes that to determine the turnover within an organization, you ask its employees questions related to job search behaviors as follows: a) contacted an employee agency, b) prepared or revised CV, c) sent CV to employers and d) went on a job interview. Due to the impossibility to obtain the study's sample job performance rates through companies' Human Resources files (Job Appraisal Forms), the researcher has designed a questionnaire based on Motowidlo and Van Scotter's (1994) overall performance definition that consists of both task performance which is related to the technical core of the job and contextual performance that is related to the behavioral non technical part of the job that supports the organization in a broader manner. Since the financial results of the sample study's companies are not published and due to the difficulty to get figures through companies' financial reports, the researcher has designed a questionnaire to measure organizational performance variable based on Kotter and Heskett's(1992) three different methods as follows: 1- average yearly increase in net income, 2- average yearly return on investment ,3- average yearly increase in stock price, yet, due to the fact that not all companies in Egypt are stock exchange registered, thus we replaced the company's annual increase in net profit instead of increase in stock price. This questionnaire has been applied on companies' CEOs, Presidents or Financial managers only to determine the company's overall economic performance.

3.3 Data Analysis

Several statistical analysis techniques have been used to analyze the research data as follows: Reliability analysis has been used to test the internal consistency of each of the research questionnaires or scales. Frequency analysis has been used to evaluate the descriptive data concerning employees' characteristics as well as frequencies resulted from their replies to different questionnaires' statements. Mann-Whitney has been used to test the differences and similarities between the dominant type of culture in both local and multinational companies. Mann-Whitney has been to test the differences and similarities between both local and multinational companies in terms of work related attitudes, work behavior, organizational performance.

4.1 Study Findings and Discussions

Hypothesis 1: Within the Egyptian national setting, the dominant type of organizational culture in multinational firms is not significantly different from the dominant one in local companies. Hypothesis 2: Within the Egyptian national setting, the strength of the dominant type of organizational culture in multinational firms is not significantly different from the strength of the dominant one in local companies.

Table (1) Local & multinational companies' dominant type of culture (Frequency analysis)
DOM_CU Dom. cultu re * Q_8_1 Comp any Crosstabu lation Q_8_1 Company 2 1 Local Mult inat ional company company 113 35 38.6% 11.9% 19 7 6.5% 2.4% 52 31 17.7% 10.6% 22 14 7.5% 4.8% 206 87 70.3% 29.7%

DOM_CU Dom. culture

c_1 c_2 c_3 c_4

Total

Count % of Total Count % of Total Count % of Total Count % of Total Count % of Total

Total 148 50.5% 26 8.9% 83 28.3% 36 12.3% 293 100.0%

C1 in the above table stands for Clan Culture, C2 for Adhocracy Culture, and C3 for Market Culture and C4 for Hierarchy Culture. Thus, it is clear that both local and multinational companies' study sample have ranked the Clan Culture as the most dominant type of culture found in their companies. Table (1) shows that 113 respondents have ranked the Clan Culture as the most dominant type of culture found in local companies with 38.6% out of the total study sample; that is 293 respondents, while 35 respondents have ranked the Clan Culture as the most dominant type of culture found in multinational companies with 11.9% out of the total study sample. On other words, 148 respondents (local and multinational) with 50.5% have ranked the Clan Culture as the most dominant type of culture found in their companies. Meanwhile, to test the null hypothesis that states "Within the Egyptian national setting, the dominant type of organizational culture in multinational firms is not significantly different from the dominant one in local companies", the researcher has used Mann-Whitney statistical analysis tool to compare between the dominant type of culture found in both local and multinational companies. Table (2) shows that p=0.300. Thus, since the agreed critical p- value of this study is .05(significance level), this means that there is no significant difference between both local and multinational companies with regards to the most type of dominant culture and that the result fails to reject the null hypothesis.

Table (2) Mann-Whitney- Local and multinational companies' type of dominant corporate culture
Ranks Q_8_1 Company 1 Local company 2 Multinational company Total N 206 87 293 Mean Rank 143.67 154.89 Sum of Ranks 29595.50 13475.50

DOM_CUL

Dom. culture

a T est St atistics

Mann-Whitney U Wilc ox on W Z As y mp. Sig. ( 2 tail ed) a. Groupi ng Variabl e:

DO M_C U L D om. c ulture 8274.500 29595.500 -1.037 .300 Q _8_1 Company

View of the above, the results show that culture is the same in both local and multinational companies which is against the study's main assumption that states that corporate cultures are different between both local and multinational companies and that difference is one of the factors behind multinational companies higher financial performance versus local ones. Meanwhile, this result clearly shows the effect of Egyptian national culture on corporate culture. Moreover, this means that the result fails to reject the null hypothesis. Meanwhile, to test the strength of the Clan Culture as well as other corporate cultures, the researcher has counted the total points reported through adding A-B-C-D alternatives' responses for both total local companies and multinational samples. Tables (3) & (4) show the strength of each culture through the addition of the total accumulated scores that respondents have given to each type of culture.

Table (3) Dominant type of culture's strength (local companies)

Organizational Culture Type Clan Culture Adhocracy Culture Market Culture Hierarchy Culture

Accumulated Score

Percentage

39085 27338 31207 27554

31% 22% 25% 22%

Table (4) Dominant type of culture's strength (multinational companies)

Organizational Culture Type Clan Culture Adhocracy Culture Market Culture Hierarchy Culture

Frequencies( total responses) 14456 10612 14146 12114

Percentage

28% 21% 27% 24%

The above tables show the strength of the clan culture as the most dominant type of culture in both local and multinational companies in Egypt. The Clan culture represents 31% of local companies' sample total accumulated scores, while represents 28% of the multinational companies' sample accumulated scores. Meanwhile, to test the null hypothesis that states "Within the Egyptian national setting, the strength of dominant type of organizational culture in multinational firms is not significantly different from the dominant one in local companies" ( hypothesis 2) , the researcher has used MannWhitney statistical analysis tool to compare between the dominant type of culture found in both local and multinational companies. Table (5) shows the results of this hypothesis.

Table (5) Mann-Whitney- Dominant type of culture's strength

Type of Culture

Mann-Whitney U

Wilcoxon W

Asymp.Sig. (2tailed)

Clan Culture Adhocracy Culture Market Culture Hierarchy Culture

7560.000 8225.000

11388.000 12053.000

-2.115 -1.112

.034 .266

7677.500 8350.000

28998.500 29671.000

-1.938 -.923

.053 .356

Thus, since the agreed critical p- value of this study is .05(significance level), while the dominant type of culture is p=0.034 is less than the agreed significance level of this study p=.05. This means that there is a significance difference between the strength of the dominant type of culture in both local and multinational companies, and that the result rejects the null hypothesis. Accordingly , it is not enough to accept similarity with regards to the most dominant type of culture in both local and multinational companies operating within the Egyptian setting without testing the strength of that type of culture in both, which leads us to the second hypothesis of this study. Therefore, although the analytical results show similarity between the dominant type of culture in both local and multinational companies operating within the Egyptian setting, yet, the strength of that dominant culture (Clan culture) is different. Hypothesis 3: Within the Egyptian national setting, there are no significant differences with regards to work-related attitudes, work behavior and organizational performance between both local and multinational companies.

Table (6) Mann-Whitney- Local and multinational companies' work-related attitudes, work behavior & organizational performance

Variable

MannWhitney U

Wilcoxon W

Asymp.Sig. (2tailed)

Job Satisfaction Organizational Commitment A-Affective Commitment B-Continuance Commitment C-Normative Commitment Average Job Involvement Turn over Intention Job performance A- Task Job Performance B- Contextual Performance Average Voluntary Absenteeism Organizational Performance

7576.000

11404.000

-2.091

.037

8129.000 7632.000 8439.500 8258.500

29450.000 28953.000 12267.500 29579.500

-1.267 -2.010 -.663 -1.060

.205 .044 .507 .289

7565.000 8413.000

11393.000 12241.000

-1.995 -.780

.046 .435

6775.500 7317.000 7307.000

27890.500 28432.000 28422.000

-3.344 -2.507 -2.450

.001 .012 .014

8087.000 2760.000

29202.000 24081.000

-1.188 -9.419

.235 .000

In view of the above, the statistical result shows that there is a significance difference between job satisfaction responses p=0.037, job involvement responses p=0.046, job performance p=0.014 and organizational performance responses p=0.000 in both local and multinational companies' study sample, while, there is no significance difference between organizational commitment p=0.289, turnover intention responses p=0.435 and voluntary absenteeism responses p=0.235 in both local and multinational companies'

study sample. The researcher believes that this result is logical since that it is normal to find that level of job satisfaction different and higher in multinational than in local companies where salaries are higher, opportunities to grow either in Egypt or through transferring to other country exist, as well as the attention that most of multinational companies pay in terms of investing in their people's capabilities. Thus, since the researcher believes that attitudes shape behavior, accordingly, satisfied people tend to be more involved in their companies' affairs, willing to spend more time at work and exert efforts to accomplish all their work tasks effectively and efficiently, which leads to both better job performance and better organizational performance, which is all reflected by the hypothesis's statistical results. Meanwhile, the organizational commitment result is questionable as its sub variables average (Affective- Continuance- Normative organizational commitment) p=0.289 shows non significance difference between both local and multinational companies. Finally, analysis shows that there is no significance difference between both samples with regards to Turnover intention p= 0.435 and Voluntary absenteeism p= 0.235 which is a logical result since both sub variables are subject to several personal, psychological factors and above all national cultural aspects, thus, we can see satisfied employee, yet he/she is not disciplined and tends to over complain, while keeps his/her performance constant and consistent with his/her targets. To sum up, there is a significance difference between job satisfaction responses, job involvement responses, job performance and organizational performance responses, while there is no significance difference between organizational commitment, turnover intention responses and voluntary absenteeism responses in both local and multinational companies' study sample.

5. Conclusion
The study results show an unexpected finding with regards to the type of corporate culture found in both local and multinational companies operating within the Egyptian market. Since the main assumption of this study was that the type of corporate culture is one of the main factors behind multinational companies' better financial performance than local ones, hence, the researcher was expecting to find different type of cultures, yet, the statistical result was overwhelming as it showed that the Clan type of culture is the most dominant one in both local and multinational companies. This result reflects the impact of the Egyptian national culture on corporate culture and that we should think of other internal factors behind the remarkable performance's distinction between both local and multinational companies in Egypt. Therefore, the study's findings eliminate the role of corporate culture in financial performance's difference between multinational companies and local one operating in the Egyptian market. Meanwhile, this result indicates the necessity of conducting a study that aims at investigating the reasons behind the financial performances differences between both local and multinational companies in order to come up with a model that uncover good financial performance antecedents. The study's findings also showed that despite corporate cultures are the same, yet their strength is different. The results showed that the Clan culture is statistically stronger in local than multinational companies.

To this end, the study also indicated statistical differences between both local and multinational companies in terms of job satisfaction level, job involvement, job performance and organizational performance to the favor of multinational companies, which is a logical result, yet, organizational commitment level was the same which is a questionable result. More importantly, the study's findings showed the importance of work-related variables (job satisfaction, organizational commitment and job involvement) in achieving good financial results and in organizational performance in general. This result indicated a very important managerial implication that managers and organizations should be aware of. Managers and organizations should continue working on conducting regular employees' surveys in order to keep their employees satisfied with different work's aspects and more involved in their organizations' objectives in order to achieve their companies' targets and objectives.

References
Blau, G. 1993. "Further exploring the relationship between job search and voluntary individual turnover', Journal of Personnel Psychology", Vol. 46, PP 313-330. Burt, R.S., Gabbay S.M., Holt G., Moran P. 1994." Contingent Organization as a Network Theory: The Culture- Performance Contingency Function', Acta Sociologica", Vol. 37, PP. 345-370. Cameron, K. and Quinn R. 2006, Diagnosing and changing organizational culture- based on the competing values analysis: A Book of Jossey-Bass, San Francisco, PP. 3-4 and P. 117. Cochran, W. G. 1963, Sampling Techniques, 2nd Ed.: A Book of John Wiley and Sons Inc., New York. Denison D.1997, Corporate culture and organizational effectiveness: A Book of Library of Congress Cataloging-in-Publication Data, P.2 George, G., Sleeth R.G., Siders M.A.1999." Organizing Culture: leaders' roles, behaviors, and reinforcement mechanisms', Journal of business and psychology", Vol. 13, No. 4.

Harrison, R., & Stokes, H.1992, Diagnosing Organizational Culture: A Book of JosseyBass, San Francisco.

Kaliprasad, M. June 2006." the Human Factor II: Creating a High Performance Culture in an Organization', Cost Engineering" Vol. 48, No. 6.

Kanungo, R.N. 1982." Measurement of Job and Work Involvement', Journal of Applied Psychology", Vol. 67, No. 3, PP. 341-349.

Kotter, J.P. & Heskett J.L. 1992, Corporate Culture and Performance: A Book of the free press, PP 68-80

Meyer, J.P., Allen N.J.1997, Commitment in the workplace: A Book of Sage Publications.

Miller, T. September, 2004." 5 steps to creating a winning culture', Healthcare Financial Management".

Motowidlo S. J. and Van Scotter J. R. 1994."Evidence That Task Performance Should Be Distinguished From Contextual Performance', Journal of Applied Psychology", Vol. 79. No. 4, PP. 475-480.

Quinn, R. and Rohrbaugh J. 1983." A Spatial Model of Effectiveness Criteria: Towards a Competing Values Approach to Organizational Analysis', Management Science", PP. 360-377.

Schermerhorn, J.R.., Hunt J.G., Richard N. Osborn 2004, Core concepts of organizational behavior: A Book of Jon Wiley & Sons, Inc.

Spector,

P.E.

1997,

Job

satisfaction,

application,

assessment,

causes,

and

consequences: A Book of Sage Publications, PP1-10. Thompson, A.A. and Strickland, A.J.1987, Strategic Management: Concepts and Cases, Forth Edition: A Book of Business Publications Inc.