Organizational Culture and Corporate Performance in the Ecuadorian Environment

Abstract

This study examines how organizational culture influences corporate performance in the Ecuadorian service sector. The study employs four organizational culture features and twelve concepts for corporate performance using a self-designed online questionnaire, which were supplied to postgraduate students from academic programs at Universidad de Las Americas (UDLA) in Quito, Ecuador. The respondents were working as managers or employees in small Ecuadorian service firms. The operational items of the questionnaire to measure organizational culture and corporate performance were designed using the Denison model. The findings reveal a statistically positive relationship between organizational culture and firm performance. Moreover, involvement, adaptability, consistency, and mission affect the non-financial performance of the Ecuadorian service sector. Involvement is the critical determinant of the influence of organizational culture on corporate performance, while training shows the strongest association with organizational culture. This study provides a perspective on long-term organizational strategies, vision, and performance. Future research should include the characteristics of the studied firms to increase the effectiveness of the proposed model.

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“…Overall, the findings on organizational culture and employee productivity, revealed a positive relationship between consistency, involvement and mission on employee productivity while there is a negative relation between adaptability and employee productivity. The findings show that as employees remain consistent and involved in the decision-making process of the organization, productivity level increases [ 45 , 49 , 51 ]. Moreover, if employees become more adaptable to the organization, employee productivity reduces.…”

“…People’s conduct is rooted in a set of underlying beliefs, and managers and employees are adept at finding consensus even when opposing viewpoints exist [ 15 ]. As historical accounts show, civilizations with consistent cultures and well-coordinated and integrated systems tend to be more successful and efficient [ 49 ]. Consistency has been used to explain the foundations of a productive corporate culture by many [ 15 , 17 , 49 ].…”

“…As historical accounts show, civilizations with consistent cultures and well-coordinated and integrated systems tend to be more successful and efficient [ 49 ]. Consistency has been used to explain the foundations of a productive corporate culture by many [ 15 , 17 , 49 ]. In addition, organizations need to align their values and belief systems with performance goals to increase productivity.…”

“…In addition, organizations need to align their values and belief systems with performance goals to increase productivity. To a large extent, goal attainment is influenced by organizational culture alignment with individual and organizational goals as well as the integration of systems and people to create synergy to execute operational and tactical activities [ 49 ]. In this way, the synergy created through cascading organizational culture will impact employee commitment and control of task performance leading to an increase in productivity.…”

“…Employees with a positive organizational culture have comparable attitudes, ethical values and beliefs, whereas employees with a negative corporate culture have different ethical values and beliefs [ 49 ]. Also, companies may succeed if their company culture and productivity management systems are in sync.…”