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The Influence of Organizational Culture on Employee Performance Mediated by

Job Satisfaction and Organizational Commitment

Conference Paper · June 2023

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ISBN 978-86-6335-104-2

Dodi Setiawan
Riatmaja 1
THE INFLUENCE OF ORGANIZATIONAL
CULTURE ON EMPLOYEE PERFORMANCE
Syahrial Shaddiq 2
MEDIATED BY JOB SATISFACTION AND
Suparmono 3 ORGANIZATIONAL COMMITMENT
Winda Andrini
Wulandari 2 Abstract: The purpose of this research is to explain the role of
job satisfaction and organizational commitment in reducing
the impact of organizational culture on employee performance.
As many as 125 people who work at startup companies in
Yogyakarta are included in the sample population of this study.
The analytical tools used include path analysis with the
Structural Equation Modeling (SEM) approach implemented
in SmartPLS 3. The results show that organizational culture
has a beneficial and substantial influence on happiness.
Organizational culture has a significant and positive effect on
employee productivity, as well as a positive influence on
organizational commitment. Then, both job satisfaction and
organizational commitment have a positive and significant
effect on worker productivity. Employee job satisfaction may
somewhat weaken the impact of organizational culture on
worker productivity, and vice versa for employee
organizational commitment and dedication. As a result, it is
very important for business leaders to pay attention to, and
cultivate, employee job satisfaction and organizational
commitment so that corporate culture can increase worker
productivity.
Keywords: Organizational Culture, Job Satisfaction,
Organizational Commitment, Employee Performance.

1. Introduction The low level of worker productivity also

affects job satisfaction. If an employee or
Organizational culture is a set of shared worker is not happy with the job they are
beliefs and practices that serve as a daily doing or the responsibility assigned to them,
reference point for top management, guiding that happiness is not hard to see.
decision-making among employees and Compensation elements, whether in the form
directing their actions towards achieving of salaries, commissions, or bonuses, are
company goals (Antonakis & House, 2013). often associated with job satisfaction. Several
It is possible to judge an organization's researchers (Bakker and Demerouti, 2017)
culture as successful if it has an effect on a have found this.
high-energy state. Organizational values that Strong employee dedication to the company
are actively practiced are more likely to is a major factor in shaping the character and
influence employee productivity (Antonakis behavior of employees while working there.
& House, 2013). The organization's dedication points
employees in the right direction so they can

Corresponding author: Dodi Setiawan Riatmaja

Email: [email protected]

153
start their jobs and see immediate results. impact on job satisfaction. This can be seen
Employees who have a strong sense of loyalty from the employees' proactive approach to
to their company are more likely to show up their responsibilities and the workplace
to work each day with a positive attitude,
environment (El-Jardali et al., 2009).
provide quality hours, and leave the company
Organizational dedication is a factor that can
on good terms. Possible actions to increase
affect performance. The level of employee
worker productivity through employee
dedication to the company affects how hard
commitment include retaining high-potential
they work to help the company achieve its
workers in each department (Kim et al.,
goals (Yan et al., 2019). Organizational
2019).
Individual productivity is measured by the
in which a worker identifies with the goals
results they produce in accordance with the
and values of the company he or she works
standards that apply to their field of work.
for (Sukanebari et al., 2020).
The term "productivity" refers to the
Worker productivity is the result of
measurable results of an organization's efforts
intentional management of activities that
over a period of time. Effort can be defined as
have an impact on organizational
the result that a person obtains according to
productivity. (Chatterjee et al., 2020). In
the applicable measures for sustained effort at
general, employee productivity is a measure
one's workplace (Yong et al., 2019; Paillé et
of the success an organization or business has
al., 2014)
achieved through its operations. Work results
By definition, organizational culture includes that can be achieved by individuals or groups
the values, beliefs, attitudes, and practices within a company in accordance with their
that drive the day-to-day operations of the authority and responsibility in order to
organization (Miska et al., 2018). Because achieve organizational goals in a lawful way,
culture has such a strong effect on employee do not violate the law, and do not conflict
productivity, understanding it can help with morals and ethics (Karim et al., 2007).
business owners and managers make good Employee satisfaction is a subjective state of
decisions for the company as a whole, not just mind about one's work that depends on
when it comes to following rules and various factors, including the nature of the
procedures. Employees' belief in upholding work itself, the quality of colleagues, the
organizational culture has a multiplicative amount of salary received, and other material
effect on efficiency in carrying out their and psychological considerations (Chatterjee
duties (Arayesh et al., 2017). et al., 2020).
Employee satisfaction at work can be defined
The business world is increasingly
as an emotional state that results from a
competitive, especially for companies that
positive view of one's responsibilities and the
focus on the digital realm, such as startups.
rewards one receives from completing those
Startup businesses in Indonesia are growing
responsibilities. Another school of thought
at an astounding pace every day. Due to
argues that job satisfaction is the outpouring
increased accessibility, the number of active
of employees' feelings about their work, so
internet users in Indonesia continues to grow.
that it has an impact on the direction of
This is evidenced by survey data from
organizational development (Khavayet et al.,
Penyedia Jasa Internet Indonesia (APJII)
2018). The term "job satisfaction" refers to
regarding Indonesia's Internet penetration in
employees' emotional reactions to their
2022, which states that the number of internet
working conditions. Feelings of liking or
users between 2021 and 2022 is 210.026.769
disliking the tasks and responsibilities
out of a total population of 272.682.600
assigned to someone can have a significant
Indonesians with an increase of 77.02 %. The

153
dominant behavior of Indonesian users is to have a negative impact on employee
using mobile/tablet devices that are productivity.
connected to their internet (APJII, 2020). Several workers have pointed out that the
Digitalization is seen as a powerful phenomenon related to organizational culture
intervention into business matters associated is related to managers not paying enough
with modernization efforts throughout the attention to their employees, and this is
organization that affect all structures, systems something that has also been highlighted by
and processes within a company. Not only other employees. It is important to pay
that, digitalization is also defined as attention to the obligations and
sustainability to meet current and future needs responsibilities of employees to ensure that
(Nikmehr et al., 2021).This presents a great they feel valued. This can be achieved in a
opportunity for startup CEOs to expand their number of ways, including keeping lines of
business. Startup founders no doubt want to communication open with colleagues, for
make their services as accessible as possible example. Workers need their boss to give
to all internet users, whether that means them inspiration and motivation to get back
simplifying the purchase and delivery of their joy for their work and to increase their
services or products. The widespread production rate.
availability of smartphones running the
There are a number of important factors that
Google Android or Apple iOS operating
contribute to job satisfaction, the first is
systems has the potential to increase people's
having a job that allows you to use your skills
internet usage. Therefore, companies on a
and receive feedback on how well you are
global and national scale are more interested
doing, and the second is how comfortable you
in expanding their operational network. One
and your co-workers are. Being in your
of the businesses he is interested in is a
workplace, both personally and
startup in Yogyakarta.
professionally, and the third is how easy it is
Based on in-depth interviews with several to do your job. The first factor is having a job
employees at a startup company in that allows you to use your skills and receive
Yogyakarta, we heard that low levels of feedback on how well you are doing.
emotional connection between co-workers (Robbins, 2018).
who prefer to work alone over those who H1: Organizational culture has a positive
prefer to work together and the issue of fair effect on job satisfaction.
compensation are contributing factors to the
The extent to which an organization is able to
labor shortage. From job satisfaction.
increase the productivity of its workforce is
Employees with minimum UMP size
directly proportional to its level of success in
requirements in their province are expected to
achieving the goals it has set for itself. When
provide substandard results. Users, whether
it comes to determining whether an
that means simplifying the purchase and
organization's culture is effective or not, one
delivery of services or products.
can see whether it has an influence on a high-
In addition, some workers have expressed energy state or not. Religious observance at
concern about organizational commitment, work may be beneficial because it has been
citing problems such as absenteeism caused shown to increase productivity at work
by the use of sick leave and the fact that (Riyantini, 2021).
overtime pay is only provided three times a H2: Organizational culture has a positive
month as examples of problems they have
effect on employee performance.
experienced. have with the organization. If it
The organization's management structure is
occurs three times, we'll assume that the
greatly influenced by its organizational
fourth delay did not occur. This is considered
culture, which consists of values and concepts

153
shared by all members of the company. The H5: Job satisfaction mediates the positive
dominant culture of an organization is closely influence of organizational culture on
related to the level of commitment shown by employee performance.
its employees towards the company. A set of
H6: Organizational commitment mediates the
guiding ideas or assumptions that employees
positive influence of organizational culture
adhere to when carrying out their
on employee performance.
responsibilities towards this company is what
Utilizing technology-based facilities and
is referred to as organizational culture.
infrastructure (hardware, software, useware)
(Ramezan, 2016).
to collect, store, back up, transmit data using
H3: Organizational culture has a positive the internet is very necessary. Technology
effect on organizational commitment. can be used to implement a work culture by
Worker satisfaction, or job satisfaction, is the implementing a flexible work arrangement,
result of the relationship created between the where employees can work anywhere and
worker and his environment, whether the anytime, so that employees can manage the
setting is conducive to happiness and flexibility of how they work but remain
productivity or not. Satisfaction in one's work productive (Fatonah et al., 2022).
life conveys a sense of fulfillment to one's
Fatonah et al. (2022) collects data to
superiors. High levels of worker satisfaction
determine the strength of a variable using
have a positive effect on productivity, helping
qualitative analysis, and the priority is
organizations move closer to their goals.
knowing the conditions and entities between
(Citrawati, 2021).
variables to understand a phenomenon by
H4: Job satisfaction has a positive effect on connecting between variables and
employee performance. determining the degree of relationship
Employees with organizational commitment between these variables. There are 4
will show respect for the company, pay variables, namely: the variable Work Culture
attention to its goals, experience emotional (X1), Competence (X2), and Information
identification with its mission, and work to Technology (X3) as independent data, and
overcome personal obstacles, all of which Employee Performance variable (Y) as the
will have a positive impact on productivity. dependent data obtained through interviews,
(Sitio, 2021).H5: Komitmen organisasi questionnaires, observation, and reference
berpengaruh positif terhadap kinerja studies (according to figure 1).
karyawan.

Figure 1. Employee Performance Conseptual Sceme

Fatonah et al. (2022) explained that it is effectiveness of a questionnaire. Testing the

necessary to test the validity by measuring the reliability to measure a questionnaire which is

153
an indicator of a variable. Conduct a place within an organization will likely
normality test to determine the distribution of involve efforts to improve the attitudes and
data in the data group, multicollinearity test to behavior of employees as they work to
detect how far the relationship and influence increase productivity. In addition to the use of
between variables with independent data. modern equipment which is a direct
Conduct a heteroscedasticity test to determine consequence of technological advances,
the variance of the variance of the residual personnel performance is another component
one observation with another observation that must be considered to ensure business
using the correlation model. Then analyze success in achieving its goals in industry 4.0
multiple linear regression to find out how big (Fadilurrahman et al., 2021). Employees who
the independent variables are Work Culture are dissatisfied with their jobs contribute to an
(X1), Competence (X2), and Information environment that is detrimental to everyone
Technology (X3), and Employee involved, at both a professional and personal
Performance variables (Y). Do a partial test, level. Dissatisfaction with one's job can result
proving whether there is a relationship in hostile behavior or, conversely, reflect a
between the variables Work Culture (X1), desire to withdraw from the social
Competence (X2), and Information environment and isolate oneself. Both of
Technology (X3) on the Employee these results are possible. For example,
Performance variable (Y) to show how much adopting a withdrawal mentality from the
influence each of these independent variables workplace, supporting disruptive behavior
has in explaining variations in the such as boIo, and taking other actions
independent variables. Finally, test the intended to avoid disrupting the operations
Coefficient of Determination to measure how being carried out by the business are all
well the model explains the variation in the possible ways of doing this.
dependent variable.
Aggressive types of behavior such as
sabotage, intentionally creating wrongdoing
2. Literature Review at work, obstructing authority, and even
engaging in strike activities are examples of
2.1. Job Satisfaction this type of behavior. According to the
research shown earlier, worker satisfaction is
"Job Satisfaction" is the attitude of workers an important factor to think about in relation
towards work related to the work to worker productivity, whereas worker
environment, co-worker relationships, dissatisfaction is often associated with high
rewards for services received at work, and workload and stress. Employees who report
other elements both physical and high levels of dissatisfaction with their jobs
psychological, as stated by Teck-Hong & are more likely to participate in acts of
Waheed (2011). According to Zendehdel misconduct at work such as sabotage or other
(2013), the goal of everyone employed is to types of misconduct.
get satisfaction from their place of work. The According to Bloisi et al (2007) indicators of
level of satisfaction experienced by workers salary or wages, namely:
in their jobs is anticipated to have a Pay Rate.
significant influence on their level of output Payment Structure.
by their managers. Managers need to be Determination of Individual Pay
aware of the procedures to be followed to
Payment Methods
generate job satisfaction in their employees.
Payment Controls
Any conversation about satisfaction at work,
According to Indradevi's research findings
(2012), intrinsic motivation influences job

153
satisfaction and performance, job satisfaction substantial contribution to achieving the
affects productivity, and organizational company's goals that have been set. This
culture influences all three. Contributing in a conclusion is based on the opinion of a
way that will enhance the impact of corporate
number of experts.
culture on the levels of job satisfaction and
productivity experienced by employees.
According to the results of Remi et al (2011), 3. Research Methods
organizational culture, intrinsic motivation,
and organizational commitment all have a This research is an example of the type of
direct influence on employee productivity. research known as explanatory study. Since
Employee productivity is not positively all 125 workers in the Yogyakarta-based
affected by corporate culture; however, Startup Company business incubator were
motivation at work, job happiness, and eligible for sampling, there was no need to
leadership all have a beneficial effect on choose too small a sample size. Interviews,
employee productivity according to findings questionnaires, and field visits are several
(Worlu & Chidozie, 2012). approaches that can be used in the data
collection process. This research seeks to
2.2. Organizational Commitment answer the question, "How does
organizational culture influence job
According to Meyer & Parfyonova (2010), happiness, worker productivity, loyalty to the
employee organizational commitment can be company, and other factors?" by checking
seen as a measure of their readiness to this and related questions. To determine the
continue working at the same company in the validity and reliability of the findings, further
future. Employees' belief in the company's analysis of the questionnaire data will be
vision and goals, their readiness to strive to carried out with the help of SmartPIS 3. It is
complete tasks, and their desire to continue determined that each question in the survey is
working there are all strengthened by valid and reliable after the correlation
employees' repeated commitment to the coefficient value is at least 0.30 and
organization. Organizational commitment, as Cronbach's aIfa value is at least 0.60.
defined by Cohen (2007), is a factor that
determines how a person identifies with an 4. Results and Discussion
organization and becomes loyal to the goals
of the organization. It can be concluded that To get an overview of the profile of the
employee commitment is shown when respondent (employee), the following is a
workers are willing to place the needs of the description of the employee's characteristics.
organization above their own and make a
Table 1. Description of Respondents' Characteristics (Source: Data processed with SmartPLS
3.0 by Researchers, 2023)
Gender Amount Percentage (%)
Female 44 35
Male 81 65
Amount 125 100
Age Amount Percentage (%)
18-20 35 28
21-30 48 39
31-40 23 18
41-50 10 8
>50 9 7
Amount 125 100

153
 Education Amount Percentage (%)
Senior High School 78 62
Diploma 18 14
Bachelor 29 24
Amount 125 100

Extracted (AVE) for each building must be

The loading of indicators must be greater than greater than 0.5 so that the research comes to
0.5, the Composite Reliability (CR) must be the conclusion that the construction is
greater than 0.8, and the Average Variance valid.Table 2.

Table 2. Model Size Results (Source: Data processed with SmartPLS 3.0 by Researchers, 2023)
Construct Indicator Outer Loading Composite Reliability AVE

KK1 0.817
Job satisfaction KK2 0.836 0.882 0.592
KK3 0.812
Organizational Commitment KO1 0.732
KO2 0.774 0.857 0.675
KO3 0.859
BO1 0.793
BO2 0.759
Organizational culture BO3 0.847 0.912 0.614
BO4 0.746
BO5 0.719
KNK1 0.725
KNK2 0.785
KNK3 0.824
Employee performance KNK4 0.785 0.838 0.634
KNK5 0.839
KNK6 0.716

Based on Table 2, it is recommended to use more than 0.5 and ranged from 0.592 to
the outer loading indicator with a value 0.675; This shows that the data collected has
between 0.71 and 0.85. Composite Reliability good quality overall. When evaluating the
(CR) values varied from 0.838% to 0.912%, discriminant validity of a model, it is
and all were greater than 0.80, which necessary to check whether the value derived
indicated that the research model was from the standard deviation of a stable
reliable. CR values range from 0.838% to variable is greater than the average.
0.912%. The AVE values found were all

Table 3. Correlation between Latent Variables (Source: Data processed with SmartPLS 3.0 by
Researchers, 2023)
Construct Job Organizational Organizational Employee
satisfaction Commitment culture Performance
Job satisfaction 1.000 0.683 0.446 0.714
Organizational 0.683 1.000 0.369 0.653
Commitment
Organizational culture 0.446 0.369 1.000 0.564
Employee 0.714 0.653 0.564 1.000
performance

153
Table 4. Root Value of Average Variance Extracted (AVE) (Source: Data processed with
SmartPLS 3.0 by Researchers, 2023)
Konstruk Average Variance Extracte (AVE)
Job satisfaction 0.597 0.774
Organizational Commitment 0.672 0.816
Organizational culture 0.604 0.774
Employee performance 0.628 0.786

square for the dependent construct, t test and

If the value (AVE) is more than 0.5, then the the significance of the coefficients.
test can be considered to have a high level of
discriminant validity. The average value in Table 5. Results of the Coefficient of
Table 5 is more than 0.5, which indicates that Determination Test (Source: Data processed
the methodology used in this study is with SmartPLS 3.0 by Researchers, 2023)
appropriate. The figure presents the results of Construct R2
Job satisfaction 0.216
tests carried out in the internal mode.
Employee performance 0.623
Organizational Commitment 0.137

In table 5 it can be seen that the R square

value of employee performance is the largest
with a value of 0.623 and the smallest on the
organizational commitment variable of 0.137.
The principle used to test the hypothesis
refers to the value shown in the output path
coefficient shown in Table 6.
From Table 6 it can be concluded that
organizational culture has a significant effect
on job satisfaction (p 0.05). These findings
indicate that organizational culture has a
positive effect on employee job satisfaction.
This finding is consistent with the findings of
Silverthorne, (2004), MacIntosh & Doherty,
(2007), and Egan et al., (2004), who found
Figure 2. Structural Mode that a set of organizational values has a
positive effect on job satisfaction.
The structural model was analyzed using R-

Table 6. Path Coefficient (Source: Data processed with SmartPLS 3.0 by Researchers, 2023)
Correlation Between Variables Path T P Information
Coefficient Statistic values
Organizational Culture on Job Satisfaction 0.446 6.187 0.000 Accepted
Organizational Culture on Employee Performance 0.282 4.468 0.000 Accepted
Organizational Culture Against Commitment 0.369 5.124 0.000 Accepted
Job Satisfaction on Employee Performance 0.393 6.417 0.000 Accepted
Organizational Commitment to Employee 0.286 4.364 0.000 Accepted
Performance

The effect of organizational culture on worker 0.05). This result shows that organizational
productivity is statistically significant (p culture influences worker productivity. This

15
finding is consistent with the research of commitment has a positive effect on worker
productivity. This finding is consistent with
Kucharska & Bedford, (2020), who found studies by Winston (2008) and Tolentino
that a set of organizational values has a (2013), all of whom found that organizational
positive effect on a measure of employee
commitment has a positive effect on worker
productivity.
productivity.
The value of organizational culture on
Table 8 shows the results of the mediation
organizational commitment is 0.000 0.05.
analysis of the relationship between
These findings indicate that organizational
organizational culture and worker
culture influences employee dedication to the
productivity; The t-statistic is greater than the
company. This finding is in line with the
t-table value (4237 > 1.96), indicating that job
findings of Asi et al. (2021) and Ependi et al.
satisfaction moderates the positive influence
(2021), who found that organizational culture
of organizational culture on worker
has a positive effect on the level of
productivity. The mediation function that has
commitment.
the strongest correlation with job satisfaction
Employee satisfaction with performance has
is the partial mediation function.
a p-value of 0.000 > 0.05. The findings show As shown by a statistically significant
that job satisfaction has a positive effect on positive relationship (t-statistic > t-table, or
worker productivity. This finding is 3.217 > 1.96) between organizational
consistent with the findings by Ravid et al., commitment and worker productivity,
(2019), Backhaus, (2019), and Yost et al., organizational culture has a positive effect on
(2018) who found that job satisfaction has a worker productivity. The function of the
significant effect on worker productivity. media supported by organizational
Organizational commitment to employee commitment is mainly that of a partial
performance has a p-value of 0.000 0.05. mediator.
These findings indicate that organizational

Table 7. Path Coefficient (Source: Data processed with SmartPLS 3.0 by Researchers, 2023)
Correlation Between Variables Path T P Information
Coefficient Statistic values
Organizational Culture -> Jobs Satisfaction -> 0.174 4.243 0.000 Accepted
Employee Performance
Organizational Culture Organizational Commitment -> 0.109 3.217 0.000 Accepted
Employee Performance

appears to have a positive effect on worker

5. Conclusion productivity. Emphasizing the role of job
satisfaction and organizational loyalty as a
According to research findings, form of "partial mediation" as a means of
organizational culture seems to have a reducing the positive effects of organizational
positive effect on employee satisfaction culture on employee performance can serve
variables, a positive effect on worker as a means of "partially mediating" those
productivity, a positive effect on employee effects, which can mitigate those effects.
commitment, a positive effect on job organizational culture on performance both
satisfaction, and a positive effect on work directly and indirectly.
commitment. In addition, job satisfaction

15
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Dodi Setiawan Syahrial Shaddiq Suparmono

Riatmaja Universitas Cahaya Sekolah Tinggi Ilmu
Universitas Amikom Bangsa Banjarmasin, Manajemen YKPN
Yogyakarta, Banjarmasin, Yogyakarta,
Yogyakarta, Indonesia Yogyakarta,
Indonesia [email protected] Indonesia
[email protected] [email protected]

Winda Andrini
Wulandari
Universitas Cahaya Bangsa
Banjarmasin,
Banjarmasin,
Indonesia
[email protected]

1544

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