Impact of organizational positive and negative culture on employee performance

Abstract

Purpose The purpose of this study is to evaluate the effect of both positive and negative corporate cultures on employee performance in Saudi Arabia, in the presence of performance reviews and factors leading to positive work culture, in an environment that underwent serious modification with COVID-19. The changing work methods (online, remote, etc.) have left their mark necessitating revisiting the needs and capabilities of employees in the work environment. Design/methodology/approach This quantitative study uses primary data from small and medium-sized enterprises (SMEs), non-profit organizations, and transnational organizations, in their transient role and influence on organizational culture change. The data set includes 311 usable responses from 50 randomly selected organizations and is analysed using structural equation modelling to test the proposed model. Findings A healthy corporate culture serves as the basis for increased employee performance in the workplace. The three independent variables, availability of negative culture, availability of positive culture and employee perceived performance, have a positive impact on the dependent variable employee perceived effectiveness of performance reviews; however, factors leading to the development of a positive organizational has a negative influence. Research limitations/implications This study faced a limitation with the potential similarity of responses due to the large number of same-background respondents (engineers). However, the results are indicative of a trend. Moreover, the responses did not allow for cross comparison between responding organizational types (SMEs, non-governmental organizations and multinational corporations) as was planned. Practical implications Managers should motivate their respective employees, through ensuring the diffusion and sustainability of the right culture work environment. This should allow their teams to complete tasks with little or no supervision. Moreover, as the Saudi economy is gearing up for global competitiveness, this performance culture becomes a key for the success of the strategic plans, thus the high importance of the positive culture at work today. Social implications Understanding the importance of positive and negative culture at the managerial level would affect the relationship with employees and improve work environment and job satisfaction. Originality/value This study pinpoints the need to revisit a dimming topic, proving that with the end of the COVID-19 pandemic, managers need to go back to square one. The introduction of the many novel work systems, online, remote work, etc. have changed the work setting and environment. This is requiring a new look at the employees’ perceptions on factors influencing corporate culture and performance.