The Importance of Involvement Culture in Organizations

(1)

The International Islamic Economic System Conference – The 9^th I-iECONS 2021

151

INTERNATIONAL ISLAMIC ECONOMIC SYSTEM CONFERENCE (I-iECONS 2021)

Sustainability in The Business Industry: The Importance of Involvement Culture in Organizations

Farah Laili Muda @ Ismail

Faculty of Economics and Muamalat, Universiti Sains Islam Malaysia (USIM), Bandar Baru Nilai, 71800 Nilai, Negeri Sembilan Malaysia

E-mail: [email protected]

Anita Ismail

Faculty of Economics and Muamalat, Universiti Sains Islam Malaysia (USIM), Bandar Baru Nilai, 71800 Nilai, Negeri Sembilan Malaysia

E-mail: [email protected]

Abstract

In ensuring the viability of a business organization in the industry, there is no doubt that corporate culture plays an important role. Whether the culture comes from outside or within the organization, it is found that corporate culture can boost the performance of an organization. Through a strong corporate culture, employees will better understand and conform to the work culture and at the same time be able to ensure a good and equal work income. Similarly, for customers, the corporate culture displayed by an organization will increase their confidence in conducting transactions. This conceptual paper focuses on the internal corporate culture that involves the participation from employees, which known as involvement culture. Based on the literatures, the involvement culture contributes to positive impacts to the organizations’ performance and sustainability.

Keywords: involvement culture; corporate culture; organization; performance; sustainability

1. Introduction

In ensuring the viability of a business organization in the industry, there is no doubt that corporate culture plays an important role. Whether the culture comes from outside or within the organization, it is found that corporate culture can boost the performance of an organization. Through a strong corporate culture, employees will better understand and conform to the work culture and at the same time be able to ensure a good and equal work income.

Similarly, for customers, the corporate culture displayed by an organization will increase their confidence in conducting transactions. This conceptual paper focuses on the internal corporate culture that involves the participation from employees, which known as involvement culture. Based on the literatures, the involvement culture contributes to positive impacts to the organizations’ performance and sustainability.

The productivity of an organization can be seen when employees are rewarded for the effort they put in.

Interestingly, workers who are less autonomous and undervalued, their likelihood of becoming depressed and will leave the job is high. For employees who are happy and feel their job is very meaningful, in general they are highly motivated and highly committed. (Fatima et al. 2020).

(2)

152 2. Sustainability in business

Business sustainability seeks to create long-term shareholder value by embracing the opportunities and managing the risks that result from an organization's economic, environmental, and social responsibilities. Business sustainability must meet the needs of the organization and its stakeholders today while also protecting, sustaining, and enhancing the environmental, social, and economic resources needed for the future (Pojasek, 2007).

Sustainability is fast becoming fashionable in strategic management, and yet its meaning is often elusive. Some people restrict sustainability to environmental issues, and others use it synonymously with corporate social responsibility. Sustainability obliges firms to make intertemporal trade-offs to safeguard intergenerational equity (Bansal, 2014).

Business sustainability is dependent on many factors but one of the most uncontrollable factor is employee´s involvement and collaboration (Vicente et al. 2015). Frequently employees are working day-afterday, repeating the same routines with no motivation or enthusiasm, feeling that any requests would not be attended by their supervisors. Results achieved from the study reveal that new ideas and contributions from employees are proven significant in promoting the company's financial and social sustainability.

In order to sustain in the business, an organization should clearly understand the current situation of the market and take prompt action to enhance organizational sustainable performance. Three specific areas of an organization include: (i) financial performance; (ii) product and market performance; (iii) shareholders return are the main contributors to sustainable business (Muthuveloo & Ping 2013). Related to this, an emphasis of internal environment is crucial to support customer needs and expectations (Gupta 2008).

3. Involvement culture

Involvement or employee involvement can be defined as creating an environment in which an employee participates more in the day-to-day decision-making which leads to a better relationship with the manager. More direct participation by employees helps the organization to achieve its goals rapidly and effortlessly (The Economic Times, 2021).

Managers consider the external environment, as well as the company’s strategy and goals in considering what cultural values are important for the organization. Two important dimensions are through viewing the external environment and internal environment. These dimensions are categorized under four types of culture, (1) adaptability culture, (2) achievement culture, (3) involvement culture or (4) consistency culture (Denison & Mishra, 1995).

Involvement culture specifically emphasizes an internal focus on the participation of employees to adapt rapidly to changing needs from the environment. Meeting the needs of employees is the priority and is characterized by a caring, family-like atmosphere (Amah & Ahiauzu, 2013).

Involvement culture can be nurtured through communicating the vision by bringing everyone onto the same page. Social media is one of the prime areas in which people are engaged in their daily lives (Dreher, 2014). The organization usually creates a page for a project, invites every employee to get involved and create an open platform where people can share ideas. Through this approach, the organization may create an immediate buzz and excitement around the future of the project.

Employees also must be equipped with the skills, tools and resources that they need to make good decisions.

With the routine of having informal huddles as well as formal gatherings on a weekly or monthly basis, from time to time the trust towards employees may be cultivated (Morgan & Zeffane, 2003). Trust and involvement go hand in hand because trusting an employee with responsibility and decision-making, may lead them to feel a sense of ownership. All of this breeds loyalty, productivity and fulfilment are pleasant and very useful to increase the organization performance (Hamed, 2010).

Involvement culture can be seen from the budgeting side of a project. By revealing the employees to understand the real condition of the organization’s financial position it may help them to put a value on their own contribution (Andries & Czarnitzki (2014). The employees become understand that success of the organization is ultimately means success for them.

Another form of involvement culture is by listening to opinions and ideas; and encouraging employees’

feedback. The employees appreciate when the organization put into consideration on their opinion or request (Zafar,

(3)

153

Butt & Afzal, 2014). The organizations also must positively consider and utilize any deviance of employees as it may enable them to find better solutions to problems than their peers. These ‘deviant’ behaviours, such as organisational citizenship, social responsibility or creativity, are valuable to be utilised in the organization.

4. Involvement culture and performance in organization

An organizational culture which involves the executives as well as employees may lead to commitment and a strong sense of ownership. The people feel that they have input into decisions that will affect their work and see a direct connection to the goals of the organization (Mazayed et al., 2014). A study conducted by Mutuku et al. (2013) focuses on the relationship between top management team diversity and organization performance in the Commercial Banks in Kenya as moderated by involvement culture. It is proven that there is a positive relationship between involvement culture and the performance of the commercial banks in Kenya.

According to Mazayed et al (2014), a person who has high organizational commitment and job involvement puts outstanding efforts as he is totally satisfied and happy with his organization, as well as the job (Ekmekci, 2011). The employees can effectively perform well when there is an increase of the involvement in decision-making and other related matters of one’s job.

Performance of an organization is significantly influenced by the job involvement among employees (Giri, et al.

2016). A study on Regional Telecommunications Employees in Indonesia reveals that the most dominant variable in determining the performance of employees is the organization’s culture. The results of research conducted by Sofijanova & Zabijakin-Chatleska (2013) on 36 companies belonging to the Macedonian manufacturing industry show the effective use of employee involvement is positively related to perceived organizational performance.

Specifically, employee participation and empowerment programs, and the use of self-managing teams have a significant correlation to the managerial perception of the organizational performance.

An interesting study conducted by Dhakal (2018) reveals involvement culture is a universal trait that has a significant association with the performance of the enterprises. Involvement trait is strongly associated variable that affects the performance of the enterprises worldwide. The higher the level of employee involvement practices higher the chances of better performance of the enterprises operating in Asia and Europe. The evidence interpreted by correlation and chi-square justify the lack of involvement culture may lead to unsuccessful enterprises.

A study conducted by Oyewo et al. (2018) examines employee involvement in organisational affairs as an important facet of social sustainability in the Nigerian banking sector. The study found that employee involvement correlates positively and significantly with organisational performance. Organisations are enjoined to get their employees involved in achieving better results; and becoming strategic resources that can be used to bolster core competence.

5. Conclusion

Based on the literatures on business sustainability, performance of one organization is a crucial need to be achieved. Performance of an organization has a strong relationship with the involvement of employees. Employee direct participation represents individual and group participation of employees in the decision-making process in an organization. Involvement culture is taken place in the form of cooperation and co-decision making. It leads to activating the potential of employees, integrates them around the goals and tasks of the organization and improvement of its internal and external processes. When the employers convince and encourage to more willingly and frequently engage the employees in the management process of the organization, they will directly participate and perform wholeheartedly; and finally lead to business sustainability.

(4)

154 References

Amah, E., Ahiauzu, A., 2013. Employee Involvement and Organizational Effectiveness. Journal of Management Development 32, 7, 661-674.

Andries, P., Czarnitzki, D., 2014. Small Firm Innovation Performance and Employee Involvement. Small Business Economics 43, 21-38.

Bansal, P., DesJardine, M. R., 2014. Business Sustainability: It Is About Time. Strategic Organization 12, 1, 70–78.

Dhakal, D. R., 2018. Role of Employees Involvement Work Culture Towards Financial Performance of Organization: A Comparative Study Between Western and Asian Markets. International Journal of Financial Management 7, 3, 41-50.

Denison, D. R., Mishra, A. K., 1995. Toward a Theory of Organizational Culture and Effectiveness. Organization Science 6, 2, 204-223.

Dreher, S., 2014. Social Media and The World of Work: A Strategic Approach to Employees’ Participation in Social Media. Corporate Communications: An International Journal, Vol. 19 No. 4, pp. 344-356.

Fatima, A., Asad Ur Rehman, Shaheera Amin, Hina Ismail, 2020. Impact of Servant Leadership on Meaningful Work with Involvement Culture as a Moderator. Pakistan Journal of Social Sciences (PJSS) 40, 4, 1553-1565.

Giri, E. E., Nimran, U., Hamid, D., Al Musadieq, M., 2016. The Effect of Organizational Culture and Organizational Commitment to Job Involvement, Knowledge Sharing, and Employee Performance: A Study on Regional Telecommunications Employees of PT Telkom East Nusa Tenggara Province, Indonesia. International Journal of Management and Administrative Sciences 3, 4, 20-33.

Gupta, V., 2008. Cultural Basis of High Performance Organizations. International Journal of Commerce and Management, 21, 221- 240.

Hamed, S. S. 2010. Antecedents and Consequences of Employees Empowerment. Management Review: An International Journal 5, 1, 64-101.

Mazayed, K., Khan, M. S., Kundi, G. M., Qureshi, Q. A., Akhtar, R., Bilal, H., 2014. Assessing the Impact of Job Involvement and Commitment on Organizational Productivity in the Arab/Gulf Countries. Industrial Engineering Letters 4, 3, 18-22.

Morgan, D, Zeffane, R., 2003. Employee Involvement, Organizational Change and Trust in Management. The International Journal of Human Resource Management 14, 1, 55-75.

Muthuveloo, R., Ping, T. A., 2013. Achieving Business Sustainability via I-TOP Model. American Journal of Economics and Business Administration 5, 1, 15-21.

Mutuku, C., K’Obonyo, P., Awino, Z. B., Musyoka, M., 2013. Top Management Team Diversity, Involvement Culture and Performance of Commercial Banks in Kenya. DBA Africa Management Review 3, 2, 70-80.

Oyewo, B. M., Iredele, O., Azuh, A. E. , 2018. Social sustainability business practices and organisational performance in Nigerian banks. Journal of Human Resource Management XXI, 1, 43-57.

Pojasek, R. B., 2007. A Framework for Business Sustainability. Environmental Quality Management 17, 2, 81-88.

Sofijanova, E, Zabijakin-Chatleska, V., 2013. Employee Involvement and Organizational Performance: Evidence from the Manufacturing Sector in Republic of Macedonia. In: The International Scientific Conference "Business and Regional Development", 20-21 June 2013, Trakia University, Bulgaria.

The Economic Times, 2021. What is Involvement? Retrieved from https://economictimes.indiatimes.com.

Vicente, S., Alves, A. C., Carvalho, M. S., Costa, N., 2015. Business Sustainability through Employees Involvement: A Case Study. FME Transactions 43, 362-369.

Zafar, F., Butt, A., Afzal, B., 2014. Strategic Management: Managing Change by Employee Involvement. International Journal of Sciences: Basic and Applied Research 13, 1, 205-217.