Impact of corporate culture on organizational commitment in Sri Lankan software industry

Abstract

Corporate Culture combines many aspects of an organization from top to bottom of its hierarchy. In addition to the tangible practices and processes followed in an organization, personal factors of an individual also amend their thoughts towards employer. Hence, Corporate Culture is an important factor in strengthening an employer-employee relationship, which in tum has a direct influence in reducing the turnover intention and Organizational Commitment. Software companies are based on knowledge workers of the organizations rather than physical assets that create competitive advantage within the industry. Thus, loss of frequent key assets can severely harm the sustainability of an organization in long run. This empirical study attempts to reveal the relationship if any, between the software professional’s perception towards Cultural factors at work place and measure their levels of Organizational Commitment. The selected population of this study is the software professionals working in software industiy in Sri Lanka which estimated as 21,914 (SLICTA, 2010) by 2010. Therefore, the calculated random sample size required 378 responses from software professionals in IT industiy. In the present study cultural factors were tested including; Communication Patterns, Training & Development, Leadership, Teamwork, Management Practices and Reward System. The results revealed that all the cultural variables have a linear relationship with Affective and Normative Commitment levels of employees. Furthermore, Teamwork, Management Practices and Reward Systems show a considerable negative linear relationship with Continuous Commitment, which reveals possible areas for further research. The study exposes that Organization Tenure and Gender moderates the relationship of Corporate Culture and Organizational Commitment as tenure increases. The results divulged the fact that influencing ability of Corporate Cultural variables on Affective Commitment reduce as Tenure increases, except for Leadership and Teamwork. Meanwhile, influencing capability increases for Normative Commitment, as Tenure increases on Commitment levels. Another significant finding was that the male software professionals give more weight for Leadership in gaining Organizational Commitment, while Female software professionals give weight to both Leadership and Reward System to gain Organizational Commitment. However there was no substantial evidence from the study that either genders being more committed to the employed organization one over the other. Age and Designation of software professionals did not disclose any impact in their level ofOrganizational Commitment. This research brings out valuable research outcomes that can be incorporated in software organization’s employee retention strategies, in order to gain stability and ultimately enhance the company bottom-line. Through the aspects of focussing on Teamwork and Leadership factors to reach higher Affective Commitment levels as tenure increases would create value in a workforce. Furthermore, the present study specifies other avenues that could be explored as future research areas, based on the variables such as the job role that would play the mediating role in measuring commitment levels.