The impact of boundary spanning activities and resource orchestration in improving performance of Indonesian state-owned bank branches

Abstract

State-owned enterprises have responsibilities to conduct head office’s strategies to make profits, to execute public programs and obligations, to maintain their viabilities, to serve customers, and to manage employees. Those prompt their branch managers not only to explore their environment but also to face a goal conflict situation. This study is to investigate the effects of branch managers’ boundary spanning activities and resource orchestration on the performance of branch offices in the dynamics of environmental uncertainty and goal conflict. This study employs structural equation modeling on one of the most prominent state-owned banks in Indonesia, with 201 branch offices as the unit of analysis, and 186 branch managers as respondents. The results of this study show that boundary spanning activities have a positive and significant relationship with resource orchestration. Meanwhile, both boundary spanning activities and resource orchestration are to influence the performance of branch offices. However, the influence varies widely, depending on environmental uncertainty and goal conflict experienced by branch managers. Furthermore, this study delves into an interesting phenomenon, that goal conflict situation, instead of reducing boundary spanning activities, it increases them but has no impact on resource orchestration. This closely relates to the culture of Indonesia as a nation with high power distance, low individualism, low masculinity, and low indulgence which represent preferences to prioritize workplace harmony, obey supervisors, and be loyal to the workplace.