MBA Thesis Daniella Griffith - Kranenberg.pdf - FHR Lim A Po ...

FHR Lim A Po Institute for Social Studies – Maastricht School of ManagementMBA VII – Management &Business Strategy2010-2012----------------------------------------------------------------------------------------------------------------THE EFFECT OF ORGANIZATIONAL CULTURE AND LEADERSHIPSTYLE ON ORGANIZATIONAL COMMITMENT WITHIN SMES INSURINAME, WITH JOB SATISFACTION AS A MEDIATORByDaniëlle Griffith- Kranenburg(SRFHR0710004)SurinameFebruary 2013Supervised byDr. Mirdita ElstakThis paper was submitted in partial fulfillment of the requirements for the Masters of BusinessAdministration (MBA) degree at the FHR Lim A Po Institute for Social Studies (FHR) inassociation with the Maastricht School of Management (MSM),February 2013.

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“Unless Commitment is made,there are only promises and hopes;but no plans”Peter F. Drucker

ACKNOWLEDGEMENTWriting this thesis has been one of the most challenging moments in my life. Without theguidance of my supervisor, the understanding and support of my husband, children, familyand friends, I would not have been able to finish this study successfully.First and far most I like to thank GOD, because his blessings and grace makes all possibleSpecial thanks to the team of the FHR Lim A Po Institute for giving me the opportunity todevelop my knowledge further.I am very grateful to my supervisor, Mirdita Elstak, who inspired me to perform well with hercritical comments, suggestions, insight and motivational words.I would like to thank my employer, Remas nv, and my colleagues for giving me theopportunity and support to attend this MBA program.Gratitude to my MBA colleagues for their support during the program.Special thanks to my uncle, Luciën Kloof, without whom I would not have started thisjourney.I would also like to thank my family, especially my parents and in-laws, for their support andencouraging words.Most of all I would like to dedicate this thesis to my loving husband, Rodney, and mychildren Cailynn, Khalil and Raïz, who was born during this journey. I will be eternallygrateful for the many sacrifices you have made for me and the love, understanding, patienceand encouragement you have given me.Thank you allSincerely,Daniëlle Griffith-Kranenburgiv

ABSTRACTThe purpose of this study was to determine what is different about the role that organizationalculture and leadership style play in Small and Medium-sized Enterprises (SMEs). How theyinfluence employee commitment to the organization and how job satisfaction mediates thatrelationship. It was said that the effect of Leadership style and the Organizational culture onOrganizational commitment was mediated by Job satisfaction.Data was gathered through questionnaires distributed to eight SMEs in Paramaribo. This wasdone to investigate the different relationships between and the impact of the variables on eachother. The scales used were the Multifactor Leadership Questionnaire, MLQ, theOrganizational Culture Index, OCI, the Job Satisfaction Survey, JSS and the OrganizationalCommitment Questionnaire, OCQ. The gathered data was statistically analyzed with SPSS.Multiple regression was applied according to the steps of Kenny and Baron(1986) who gavethe specifications of the procedure for regression analysis when a mediating variable isinvolved. Some of the results were according to the expectation after theory examination, butothers were surprisingly contradictive.Transformational leadership had a direct and indirect (through job satisfaction) effect onOrganizational commitment. Of the other 4 predicted indirect effects 1 was significantnamely one with bureaucratic culture. This effect was positive instead of negative as washypothesized. Bureaucratic and Supportive culture had a significant direct effect onOrganizational commitment.Based on the result of this research it is recommended that transformational leadership styleshould be practiced in SMEs to gain satisfied and committed employees. Leaders need tostate their views clearly; they need to consider employee capabilities and needs. This couldultimately lead to a better performance and a competitive advantage for the organization.Key wordsLeadership, Leadership style, Transformational leadership, Organizational culture, Jobsatisfaction, Organizational commitment and SMEsv

TABLE OF CONTENTSAcknowledgement .................................................................................................................... ivAbstract ...................................................................................................................................... vList of Figures ........................................................................................................................... ixList of Tables ............................................................................................................................. x1 Introduction ........................................................................................................................ 11.1 General ........................................................................................................................ 11.2 Background ................................................................................................................. 11.3 Relevance and justification ......................................................................................... 41.4 Problem Statement ...................................................................................................... 41.5 Research Objectives .................................................................................................... 51.6 Research Questions ..................................................................................................... 61.7 Research Limitations ................................................................................................... 61.8 Outline of the Thesis structure .................................................................................... 72 Literature Review ............................................................................................................... 82.1 Introduction ................................................................................................................. 82.2 Concept of Leadership ................................................................................................ 82.2.1 Leadership defined ............................................................................................... 82.2.2 Leadership vs. Management ................................................................................ 92.2.3 New Approach to Leadership ............................................................................ 102.3 Organizational culture ............................................................................................... 112.4 Job satisfaction .......................................................................................................... 132.5 Organizational commitment ...................................................................................... 132.6 Small and Medium-sized Enterprises ........................................................................ 142.6.1 General definition of SMEs ............................................................................... 152.7 Relationship between the variables ........................................................................... 162.7.1 Job satisfaction and Leadership styles ............................................................... 16vi

2.7.2 Job satisfaction and Organizational Culture ...................................................... 172.7.3 Organizational commitment and Job satisfaction .............................................. 192.7.4 Organizational Commitment and Leadership style ............................................ 193 Methodology ..................................................................................................................... 213.1 Introduction ............................................................................................................... 213.2 Research Philosophy ................................................................................................. 213.3 Research design ......................................................................................................... 213.4 Questionnaire design and measures .......................................................................... 223.4.1 Survey administration ........................................................................................ 223.4.2 Reliability and validity ....................................................................................... 233.4.3 The questionnaire and measurement scale ......................................................... 233.4.4 Data processing .................................................................................................. 273.5 Research population and Sample .............................................................................. 273.6 Data analysis ............................................................................................................. 283.7 Summary ................................................................................................................... 284 Findings and Analysis ...................................................................................................... 294.1 Introduction ............................................................................................................... 294.2 Sample population profile ......................................................................................... 294.3 Descriptive statistics .................................................................................................. 334.4 Correlation ................................................................................................................. 344.5 Regression Analysis .................................................................................................. 364.5.1 Regression analysis Leadership style and Organizational Commitment ........... 384.5.2 Regression analysis Leadership styles, Organizational culture and Jobsatisfaction ........................................................................................................................ 394.5.3 Regression analysis Leadership styles, Organizational culture, Job satisfactionand Organizational Commitment ...................................................................................... 404.6 Hypothesis testing ..................................................................................................... 414.7 Summary ................................................................................................................... 45vii

5 Discussion, Conclusions and Recommendations ............................................................. 465.1 Introduction ............................................................................................................... 465.2 Discussion and conclusions ....................................................................................... 465.3 Implications for Theory and Practice ........................................................................ 495.4 Recommendations ..................................................................................................... 51References ................................................................................................................................ 52AppendiX ................................................................................................................................... aAppendix A: Introduction of the researcher to the questionnaire respondent........................ bAppendix B: The Questionnaire ............................................................................................. cviii

LIST OF FIGURESFigure 1-1Structure of the thesis ................................................................................................ 7Figure 2-1 Proposed Conceptual Framework .......................................................................... 16Figure 2-2 Conceptual Framework specifying the variables and the research Hypotheses .... 20Figure 4-1 The gender response in % of the sample population.............................................. 29Figure 4-2 Job level response in % of the sample population ................................................. 30Figure 4-3 Age division in % of the sample population .......................................................... 30Figure 4-4 The education level in % of the sample population ............................................... 31Figure 4-5 The monthly salary in % of the sample population................................................ 31Figure 4-6 Tenure in % of the sample size .............................................................................. 32ix

LIST OF TABLESTable 2-1 Relationship between Culture, motivators and Job satisfaction .............................. 18Table 3-1 Cronbach’s Alpha’s for Leadership style ................................................................ 24Table 3-2 Cronbach’s Alpha’s for Organizational culture ...................................................... 25Table 3-3 Cronbach’s Alpha from Job satisfaction ................................................................. 26Table 3-4 Cronbach’s Alpha from Organizational commitment ............................................. 27Table 3-5 Analysis Overview ................................................................................................. 28Table 4-1 Independent, Dependent and Mediating variables with the mean, median, mode,standard deviation and skewness ............................................................................................. 33Table 4-2 Correlation Matrix ................................................................................................... 35Table 4-3 Regression coefficient Transformational leadership and OrganizationalCommitment ............................................................................................................................ 38Table 4-4 Model Summary Transformational leadership on Organizational Commitment .... 38Table 4-5 Regression coefficient Leadership styles, Organizational Culture and JobSatisfaction ............................................................................................................................... 39Table 4-6 Model Summary Leadership styles, Organizational Culture on Job Satisfaction ... 39Table 4-7 Regression coefficient Leadership styles, Organizational Culture, Job Satisfactionand Organizational commitment .............................................................................................. 40Table 4-8 Model Summary Leadership styles, Organizational Culture, Job Satisfaction andOrganizational commitment..................................................................................................... 41Table 4-9 Summary Regression Analysis ................................................................................ 41Table 4-10 Overview Null and Alternative Hypotheses .......................................................... 42x

1 INTRODUCTION1.1 GeneralIn this chapter the background of the research project is presented, followed by an elaborationon the relevance and justification of the study. Furthermore the key concepts of the study arestated which is followed by the problem statement, the research objectives and the researchquestions. Lastly the limitations and the outline of the thesis structure are stated.1.2 BackgroundHuman Capital, which gives competitive edge due to its uniqueness, is one of the resourcesthat work as a pillar for an organization (Holland, Sheehan and de Cieri, 2007). The focus hastherefore shifted to “people”, the employees of the organizations (Cohen, 2005). Employeesplay an important role in organizations, they are the greatest resource an organization canhave and it is through their involvement and commitment that the organization can becomecompetitive (Sempane, Rieger & Roodt, 2002). Employees who are committed are liable toincrease their performance and devote their time to the organization (Saal & Knight, 1987).Organizational commitment is often described as the key factor in the relationship betweenemployees and organizations (Raju & Srivastava, 1994). It incorporates thoughts of beingconnected, attached and going beyond the basic requirements of the job which tend toimprove organizational efficiency and effectiveness (Williams & Anderson, 1991).Recruiting, managing, developing and retaining the employees, its human resource, is whatan organization’s effectiveness depends on (Wallach, 1983). These four aspects influencestability and productiveness of the workforce. Finding ways to improve how employees feelabout their job (achieving job satisfaction), so they would become more committed to theirorganization, is the basis to achieving a competitive organization. Satisfied employees aremore willing to try new ideas and could participate more in the decisions that need to bemade (Kivimaki & Kalimo, 1994).Due to their impact on performance and the success of an organization, Organizationalcommitment and job satisfaction, characteristics of the way employees behave, received a lotof attention in workplace studies. Organizational commitment and job satisfaction increased inimportance over the last few years (Lok & Crawford, 2004) because, they predict the input ofemployees and as Wilson and Rosenfeld (1990) indicated positive and negative feelingstowards work and the organization may have powerful effects on the way employees behave in1

an organization. Organizations try to encourage commitment in their employees in order toachieve stability and avoid cost when employees leave.When employees are satisfied with their job, they are committed and usually not tempted tolook for other opportunities (Lok, Wang, Westwood & Crawford, 2007). According to Porter& Smith (1970) organizational commitment is achieved when the employee strongly beliefsin and accepts the organizational goals and values, when they are willing to do their utmoston behalf of the organization and when they are willing to stay with the organization. In thisdefinition commitment is something more than submissive loyalty to an organization. Itmeans that you have an active relationship with the organization in the sense that you aregoing beyond normal duties with the intention of adding to the well being of the organization.Commitment could be concluded not only from employees their experiences and opinions butalso out of their actions. Job satisfaction is a set of feelings an individual has about his or herjob (Robbins, 2005). In research done by Lawler (1992) his theory offers a theoreticalconnection between more instant positive emotions like satisfaction, and longer lastingfeelings like commitment. As a concept commitment differs from job satisfaction.Commitment represents a general response to the whole organization, goals and valuesincluded. Job satisfaction only focuses on one’s job or certain aspects of the job; itemphasizes specific surroundings of a task where the employee executes his duties. Due to allthese factors organizational commitment is more stable overtime, it is not influenced by dayto day events (Porter et al, 1974) like job satisfaction which can quickly increase or decreaseas a result of immediate reactions to different incidents or aspects of the work location.People tend to evaluate their jobs on the basis of factors that they find important (Sempane etal, 2002). If the employees get the salary, the working conditions, the recognition and theadvancement they want, they will probably be more productive and will also stay with theorganization (Mc Neese-Smith, 1997; Randeree & Chaudhry, 2012).Leadership is seen as a determinant of several aspects in the way employees behave, so itsimpact cannot be overlooked (Randeree & Chaudhry, 2012).Organizational crises, mostly due to the world economic crises, emphasized the need forleadership and organizational culture development by organizational decision makers (Earle,1996). Changes occurred in employment practices and the decision makers needed to gettheir organizations through the crises by creating trust, influencing employees to achievecommon organizational goals (Leadership) with certain values and beliefs of the organizationin mind (Northouse, 2007).2

Different studies showed leadership and organizational culture to have a significant influenceon organizational commitment and job satisfaction (Lok and Crawford, 1999, 2001). If aleader and his style are seen as trustworthy, employees are willing to follow that leader inaccomplishing the organization’s goals. This leads to positive results for the organizationwhich in time affects job satisfaction and organizational commitment. In the case oforganizational culture, having a set of values and beliefs which are commonly shared createsaffinity and a connection with the organization (O’ Reilly, 1989; Chen, 2004) because peoplethan identify with the organization and want to be part of the collective and they are alsomore likely to have values which benefit the organization. Organizational culture is theshared understanding of the beliefs, values, norms and philosophies of how things work(Wallach, 1983). Employee behavior (their commitment and job satisfaction), theirexpectations and their performance will determine if the implementation of plans, policiesand strategies is successful and if the organization will be competitive.This research will be done in Small and Medium-size Enterprises (SMEs). They usually havea flatter organization structure. The small number of employees, centralized decision making,depending on the sector a small number of highly educated employees, the high level ofinformality, the close personal relationships and the short lines of communication causedifferent interactions between leaders and their employees in small organizations than inlarge organization (Bolden &Terry, 2000;). SMEs are often used as an option for unskilledand semi skilled employees to earn the knowledge and experience before moving to anotherbigger and or better organization. Therefore SMEs repeatedly experience the loss of skilledemployees who could play a part in the improvement of the organizations production. Thisloss of skilled employees could be the result of them being dissatisfied which could influencetheir commitment to the organization.It would be interesting to see how leadership and organizational culture, influenceorganizational commitment and what kind of mediating affect job satisfaction has on thisrelationship within SMEs.3

1.3 Relevance and justificationThe majority of businesses in most countries are Small and Medium-sized Enterprises. Theyare the mainstay of most economies in the world especially when we look at employment andthe impact they have on development of those countries 1 .With current conditions, like high employee turnover and slow economic growth, facing theestablished small and medium sized enterprises, the main goal of this research is to determinewhat type of leadership style and organizational culture keeps employees committed to anorganization, an SME where the relationships (as mentioned earlier) between the leader andthe employees are different from those in large organizations and if job satisfaction had amediating effect in this relationship.This research will show what is expected by employees in terms of leadership style,organizational culture, being satisfied with their job and being committed to an organization.It will also add value to leadership and organizational culture studies in Suriname by being aguide for current and future leaders in their struggle with retaining employees through jobsatisfaction and organizational commitment. Retaining skilled employees is needed to surviveand be competitive in local, regional and international markets.1.4 Problem StatementOrganizational commitment has received a lot of attention in research of the workenvironment. It has been measured and conceptualized in many different ways, but stillremains a challenging construct (Lok et al, 2007). The relationship between organizationalcommitment, organizational culture and leadership style, namely the effect that culture andleadership style, as independent variables, have on commitment as a dependent variable inSMEs, has not been given much attention in research (Lok et al 2007).Many of the studies on the earlier mentioned constructs were done in large companies and indifferent concept relationships, so this research will view these concepts from another angleby looking at the relationships between them in Small and Medium sized Enterprises. Therelationships are different because they have fewer resources, smaller communicationsystems, different leadership styles and slim growth opportunities. These characteristics areexpected to be different in SMEs.1 Issue Briefing Note: Small and Medium-sized Enterprises, 2004.4

As mentioned earlier SME’s form the mainstay of most economies in the world. That is alsothe case in Suriname. Having committed employees is therefore important to guaranteeperformance within and the survival of the organizations which in turn can benefit theSurinamese economy. Research on how to reach that goal, committed employees, is thus ofeminent importance, especially in the Surinamese context.1.5 Research ObjectivesIf the employees are satisfied and committed improved productivity, profit and growth of theorganization are achieved. Organizational commitment results in a stable workforce(Mohanty et al, 2012) and the retention of valued skills because the organization can thusform a consistent group of employees who worked with each other longer and know thestrengths and weaknesses they have amongst each other. This results in improvedcommunication among employees and workforce support for the organization. Whenemployees are committed they are involved and have an active relationship with theorganization, they are also willing to give “something of themselves” for the organizationswell being (Porter et al, 1979). So organizational commitment is very important for anorganization’s survival.The main purpose of this research is to determine what is different in SMEs about the rolethat organizational culture and leadership style play, how they influence organizationalcommitment of employees within SME’s and how job satisfaction mediates that relationship.Ultimately this research should give Small and Medium sized enterprises a view on how toimprove their organizational culture and leadership style with the intention of creating andkeeping a committed workforce.5

1.6 Research QuestionsThe research will address the following questions:Main Research Question: How and why do leadership style (Transformational,Transactional) and organizational culture (Bureaucratic,Innovative or Supportive) affect organizational commitment inSmall and Medium-sized Enterprises, through job satisfaction?This research will argue that organizational commitment is influenced by different types oforganizational culture and different styles of leadership. Job satisfaction has a mediating rolein this relationship; it can either strengthen or weaken the organizational commitment ofemployees.The following secondary research questions will also be answered:1. How and why does leadership style (Transactional, Transformational) affect jobsatisfaction within SME’s?2. How and why does organizational culture (Bureaucratic, Innovative or Supportive)affect job satisfaction within SME’s?3. How does job satisfaction affect organizational commitment?4. Does Transformational leadership have a direct effect on Organizationalcommitment?The secondary research questions will help determine the answer to the main researchquestion and clarify the different concepts mentioned.1.7 Research LimitationsThe limitations in this research are as follows: Other variables, beyond the earlier mentioned will not be considered in this research; Not all the needed company data is correctly documented or retraceable; Not all company data is up-to date; There is no information of the total number of SMEs in Suriname.6

1.8 Outline of the Thesis structure1. Introduction2. Literature Review3. Research Methodology4. Findings and Analysis5. Discussion, Conclusions andRecommendationsFigure 1-1Structure of the thesisThis thesis consists of 5 chapters of which the first chapter covers the Introduction to thesubject with the relevance and justification, the research questions, problem statement,objectives and the limitations. Next the literature review (2) where the researcher analyzes theexisting literature about the subject and develops a theoretical framework for the study.Thereafter the research methodology (3) is described. Here the methods used to achieve theresearch objectives are explained. In the finding and analysis chapter (chapter 4) the resultsare presented. These results will be analyzed and tested. Furthermore the researcher willdiscuss the meaning of the findings in chapter 5. The conclusions and the recommendationswill also be given this chapter.7

2 LITERATURE REVIEW2.1 IntroductionIn order to answer the research questions several steps need to be taken. One of these steps isviewing relevant theory about the concepts Organizational culture, Leadership, Jobsatisfaction and Organizational commitment which is done in this chapter. The theory ofSmall and Medium sized Enterprises (SMEs) is also explored because this is a different typeof organization. So the definitions and the characteristics of this type of organization are alsolooked at. A review of past findings on the relationships between the earlier mentionedvariables is presented and at the end of this chapter the theoretical framework for this studywill be presented.2.2 Concept of Leadership2.2.1 Leadership definedFor as long as there was interaction between people, leadership existed. The topic ofleadership has been the focus of studies for the past 20 years and gradually became a topic ofgreat interest. This interest sprung forth out of the fact that leaders provide guidelines andthey have to motivate their followers to accomplish tasks (Gill, 1998).Early on, leadership definitions had the tendency to view the leader as the center or the focusof a group activity. The leader restructures the problems, offers solutions to the problems,establishes priorities and initiates developmental operations (Bass B. , 1990). Leadership wasassociated with strength of personality (Bass 1990; Bowden, 1926). A leader was seen as aperson with many popular traits of personality and character (Bass, 1990; Bingham, 1927).The current descriptions of leadership no longer regard only individual characteristics ordifferences (Avolio 2007; Yukl 2006).In Bass’s (1998) current definition, leadership is an interaction between one or moremembers of a group. In another more recent definition, leadership is a relationship betweenleaders and followers where they influence each other and they intend real changes andoutcomes that reflect their shared purposes (Daft, 2005).According to Northouse (2007) leadership as a process means that, as mentioned earlier, it isnot a characteristic someone is born with, it is an interaction between leaders and their8

followers. The leaders influence and are influenced by their followers (a group). Leadershipis available to everyone; it is not limited to the person in power (Northouse, 2007).For this research the following definition for leadership will be applied:“Leadership is a process whereby an individual influences a group of individuals toachieve common goals (Northouse, 2007) “This definition is best suited for this research due to the ongoing interaction between leadersand followers in SMEs due to the short communication lines and the flatter organizationstructure.Leadership style is the combination of attitude and behavior of a leader, which leads tocertain patterns in dealing with the followers (Dubrin 2004). It is the result of the philosophy,personality and experience of the leader. There are several leadership styles such as:autocratic, bureaucratic, charismatic, democratic, participative, situational, transformational,transactional and laissez faire leadership (Mosadeghrad, 2003a). Leadership style has beenthe deciding factor of more than one facet of employee behavior in organizations.2.2.2 Leadership vs. ManagementLeadership and management are considered to be overlapping concepts and are oftenconfused. According to Kotter (1999) leadership and management are two concepts whichare unique and matching systems of action. He distinguished different main factors wherethese concepts have complementary actions (Kotter, 2009).These are: Leadership involves the development of a vision of the future, having a sense ofdirection. Leaders have to clarify the big picture and set strategies (Northouse, 2007).Management uses management processes, like planning and budgeting, to set thedirection for the organization; Management is the development of the ability to realize plans in organizations bycreating an organizational structure. Leaders however align people and share the newdirection, they communicate goals, seek commitment and build teams and coalitions(Northouse, 2007); Motivation and inspiration of people are important characteristics of leadership whichmake sure that the organization keeps moving in the right direction. They satisfyunmet needs and empower followers.9

Although both, leadership and management are needed in an organization this study focuseson leadership as an independent variable because setting direction, alignment, motivation andinspiration of people (Kotter, 2001) is needed to keep employees satisfied and committed tothe organization. These are the qualities of leaders, thus the focus on leadership style.Leadership considers follower feelings while management has a more controlling manner ofgetting things done.2.2.3 New Approach to LeadershipRelationships between supervisors and their employees are different now. Leaders now donot depend as much on their legitimate power to convince people to do as they are told butthey participate in an interaction with their employees or they widen and raise the interest oftheir employees (Northouse, 2007).Based on the new approach to leadership, there are two contemporary leadership styles whichwill be researched namely (Bass, 1990):1. Transactional leadership motives and directs followers by appealing to their own selfinterest. The focus is on basic management processes like controlling, organizing andshort-term planning. This style is more responsive and deals with present issues. It alsorelies on inducement of rewards, punishment and sanction for unacceptable performanceand the ability of the leaders to motivate followers by setting goals and promising rewardsfor the desired performance.An exchange takes place between leaders and followers to achieve the desiredperformance. These exchanges involve four components of Transactional Leadershipnamely (Bass, 1990; 1999): Contingent Reward (CR): Leaders explain their expectations, provide the neededresources, set shared goals and link them to various rewards for doing well; Management by Exception Active (MBEA): Here leaders specify rules andstandards. Furthermore they observe the work of the employees, watch fordeviations and take corrective actions when mistakes or errors occur; Management by Exception Passive(MBEP): Leaders do not intervene untilproblems occur, they wait for things to go wrong before they take action; Laissez-Faire (LF): The leader renounces responsibility and avoids makingdecisions which leaves the employees without direction.10

2. Transformational leadership anticipates future trends, inspires to understand andembrace new possibilities and builds the organization into a community of challenged andrewarded learners. This style also develops others to be leaders or to be better leaders. Itsfocus is on being proactive, expecting nothing in return, inspiration and motivation offollowers to work for goals that go beyond their self- interest. Learning opportunities arecreated and followers are stimulated to solve problems. The leaders develop strongemotional bonds with their followers and they posses good visioning and managementskills.This leadership style has four components which are (Bodla & Nawaz, 2010; Robbins,2005): Idealized Influence (II): Leaders act in such a way that they can be perceived asrole models by the people they lead. They are admired, respected and trusted.These leaders are willing to take risks and they are described by followers ashaving exceptional capabilities, being persistent and determined. They have highethical and moral standards and can be trusted to do the right thing. Inspirational Motivation (IM): These leaders arouse the team spirit and showenthusiasm and optimism. They involve followers in defining the desired futurestate of affairs which creates commitment to the goals and the shared vision. Intellectual Stimulation (IS): The transformational leaders stimulate theirfollowers to be creative and innovative by creating an environment in which theyare forced to think about old problems in new ways. Mistakes are not publiclycriticized. Individualized Consideration (IC): The leaders act as mentors and coaches. Twowaycommunication is regular and differences are accepted. They respectindividual desires and needs. They also delegate different tasks to developfollower skills.2.3 Organizational cultureOrganizational culture is a complex phenomenon (Dubkēvičs & Barbars, 2010). This conceptcan be very broad and take on many aspects. While conducting research the researcher cancome across many definitions of organizational culture. However many define organizationalculture as a value system which determines attitude (Schein, 1985, 1990; Peters & Waterman,1982).11

The most popular organizational culture definition was given by Edgar Schein (1985). Hedefined organizational culture as “(a) a pattern of shared basic assumptions, (b) invented,discovered, or developed by a given group, (c) as it learns to cope with its problems ofexternal adaption and internal integration, (d) that has worked well enough to be consideredvalid and, therefore (e) is to be taught to new members as the (f) correct way to perceive,think and feel in relation to those problems”. Schein (1990) and Daft (2005) discussed thatthere are three levels of culture manifestation namely:1. The observable values (artifacts): this is the level that can be observed, the visibleorganizational structures and processes. This level is still hard to understand;2. The espoused values: on this level an image of the organization is created. The strategies,goals and philosophies are formulated through answered certain questions, to create thatimage;3. Basic underlying assumptions: these are deep beliefs which form the essence of culture.In this research the following definition for organizational culture will be applied:“Organizational culture is the shared understanding of the beliefs, values, norms andphilosophies of how things work (Wallach, 1983)”According to Wallach (1983) another way to analyze culture is by dividing culture into threecategories namely: (1) Bureaucratic, (2) Innovative or (3) Supportive cultures. A bureaucratic culture is a very organized and systematic culture based on powerand control with clearly defined responsibilities and authority. Organizations with thisculture are mature, stable, structured, procedural, hierarchical, regulated and poweroriented; An innovative culture has a creative, result oriented, challenging work environmentand is portrayed as being entrepreneurial ambitious, stimulating, driven and risktaking; A supportive culture displays teamwork and is a people-oriented, encouraging, andhas a trusting work environment. This culture is open harmonious, trusting, safe,equitable, sociable, humanistic and collaborative.Wallach (1983) also stated that an employee is more effective in doing the assigned job andrealizes his or her full potential when the individual motivation and the organizational culturematch. This is very important in recruiting, managing, motivating developing and retainingemployees.12

2.4 Job satisfactionJob satisfaction has been a topic of interest among researchers for several decades (Currivan,1999; Lund, 2003) due to the fact that many experts (managers and researchers) belief that itcan affect and influence work productivity, employee commitment, employee turnover andemployee retention (Eslami & Gharakhani, 2012). Job satisfaction is the level to which anemployee is satisfied with his current work. This depends on how many of his/her needs andwants are satisfied (Finn, 2001). Job satisfaction is known as a construct with multi facetsthat includes the employee feelings about different job elements, intrinsic as well as extrinsic.It includes specific features of satisfaction associated with pay, benefits, supervision,organizational practices, promotion, work conditions and relationships with co-workers(Misener et al, 1996).In this research the following definition for job satisfaction will be applied:“Job satisfaction is the extent to which people like (satisfaction) or dislike (dissatisfaction)their jobs (Spector, 1997)”According to literature job satisfaction is influenced by several factors. Worrell (2004)divided these factors into three groups: Demographic data: age, gender and race; Intrinsic factors: achievement, recognition, work itself, responsibility, advancementand growth; Extrinsic factors: company policy, supervision, relationship with boss, workconditions, relationship with peers and salary.In this research the focus will be on the five factors of job satisfaction which are salary (pay),work itself (nature of the work), supervision, advancement and growth (promotionalprospects), relationship with peers. These factors correspond with the feelings, like or dislikeof their jobs, mentioned in the definition and are relevant to determining the level ofcommitment to an organization. Furthermore research (Randeree & Chaudhry, 2012) showedthat these factors strongly affect job satisfaction. Employees who feel satisfied with their jobare more productive and are likely to stay with the organization (Mc Neese-Smith, 1997).2.5 Organizational commitmentOrganizational commitment is an individual’s psychological attachment to the organization.The individual feel a sense of belonging and identification with the organization.13

This adds to their desire to achieve the goals of the organization and their motivation toremain with the organization (Raju & Srivastava, 1994).Organizational commitment has also been defined as the belief of an employee in the goalsand values of an organization and the aspiration to stay with that organization (Mowday et al1982). Robbins (2005) also had a similar definition of organizational commitment, thecondition where the employee identifies with the organization and its goals and desires tocontinue being a member of that organization.In this research the following definition for organizational commitment will be applied:“Organizational commitment is “a strong belief in and acceptance of the organization’s goals andvalues; a willingness to exert considerable effort on behalf of the organization; and a strong desireto maintain membership in the organization” (Mowday, Steers, & Porter, (1979)Initially organizational commitment was conceptualized as a one-dimensional construct but itis now known as multi dimensional. Porter et al (1974) stated that organizational commitmentcontains 3 components which are: Value commitment: employees trust, accept and commit to the goals and values of theorganization; Effort commitment: employees display a high degree of effort to an organization; Retention commitment: employees want to continue being a part of the organization.According to Porter et al (1974) and Mowday et al (1982) the degree of organizational andmanagerial collaboration an employee feels, their participation in decision making, theleadership style and organizational culture influence whether an employee has high or loworganizational commitment.2.6 Small and Medium-sized EnterprisesSmall and medium-sized Enterprises (SMEs) are the backbone of many economies becausethey account for close to 95% of all firms and also play an important role in employment.These enterprises need to invest, produce innovative product and operate efficiently andeffectively to maintain their position and ensure that their business activities have addedvalue.14

2.6.1 General definition of SMEsThe majority of businesses in any country are SMEs. They have become the driving forceresponsible for growth and development.SMEs are defined as “non- subsidiary, independent firms which employ less than a givennumber of employees 2 ”. This number may vary from country to country.Various countries and regions apply different criteria for the definition of SMEs because theyhave different levels of development, inhabitant size or average business size. The criteriaused in the definition of SMEs are:1. Number of employees;2. Amount of yearly sales;3. Amount of total assets;4. Amount of total revenues.The International Labor Organization (ILO) only uses the number of employees incategorizing enterprises in the different sectors. This is done because there is no officialdefinition of SMEs. The following categories are specified: Micro-enterprise: 1 to 5 workers (full- or part-time) Small-enterprise: 6 to 20 workers (full- or part-time) Medium-enterprise: 21 to 50 workers (full- or part-time) Large-enterprise: 51 or more workers (full- or part-time)In Suriname the criteria for SMEs commonly used is the number of employees. Thecategorization, according to the Suriname Trade and Industry Association (VSB) is asfollows: Micro-enterprise: 1 to 10 workers (full- or part-time) Small-enterprise: 10 to 25 workers (full- or part-time) Medium-enterprise: 26 to 100 workers (full- or part-time) Large-enterprise: 101 or more workers (full- or part-time)This research is done in the Surinamese context which is why the definition of the VSB isused. It is important to work with a definition formulated by Surinamese authorities becausethe inhabitant size, the average business size and the level of development differs from othercountries2 OECD Policy Brief: Small and Medium-sized Enterprises: Local Strength, Global Research, June 2000.15

2.7 Relationship between the variablesFigure 2.1 presents a summary diagram of the proposed causal model for the prediction oforganizational commitment from the concepts: leadership style, organizational culture andjob satisfaction. The model specifies the role of job satisfaction as a mediator of the effectthat leadership and organizational culture have on organizational commitment. In this sectionthe basis of the proposed conceptual framework is presented and the hypotheses regarding therelationships between the variables are specified.Leadership styleJobSatisfactionOrganizationalcommitmentOrganizational CultureFigure 2-1 Proposed Conceptual Framework2.7.1 Job satisfaction and Leadership stylesIt is important for an organization to function efficiently and effectively. Leadership and jobsatisfaction play an important role in creating and maintaining the effectiveness of anorganization.The relationship between leadership style and job satisfaction received a lot of attention inresearch, however, findings were mixed (Yousef, 2000). Understanding this relationship mayhelp to reveal underlying causes of satisfaction or dissatisfaction with the job. Strategiescould be developed to improve overall job satisfaction among employees. Different aspectsof the leadership styles could lead to satisfaction. Many suggest that the leadership styleneeds to adapt to the situation in order to reduce dissatisfaction of employees. Research alsoindicates that if the employees trust their leader, it leads to positive outcomes for theorganization due to the reflection of the attention that leaders give their employees on theemployees’ positive attitude towards work and the conditions within the work environment.The response of employees to their leaders will generally rely on the characteristics of theemployees as well as that of the leaders (Wexley & Yukl, 1984).16

Job satisfaction is affected by the internal organization environment, which includesorganizational climate, leadership styles and personnel relationships (Seashore & Taber1975). The quality of the leader-employee relationship – or the lack thereof - has a hugeaffect on the employee’s sense of worth and job satisfaction (Chen, Spector& Jex 1991).Employees are more satisfied with leaders who are thoughtful and encouraging than withthose who are either indifferent or judgmental towards employees (Yukl, 1971). Negativeleader-employee relations decrease productivity and increase absenteeism and the intention toleave the organization can be high (Ribelin, 2003).Transformational leadership style reduces work stress and increases employee morale. Thisleadership style moves employees to achieve more than is expected. Having a goodconnection with employees and having a clear vision plays an important role in attainingpositive results from employees (Bass & Avolio, 1990; Shamir, 1995). Researchers (Smith&Peterson, 1988; Mohammad et al, 2011) belief that certain qualities a transformational leaderhas produce satisfied employees. Transformational leadership is found to be positively relatedto job satisfaction.Transactional leaders however only reach their expected outcomes when they offer rewardsor other incentives in return (Bass & Avolio, 1990). This leadership style is negatively relatedto job satisfaction.According to Robbins (2003), less employees leave with transformational leadership thanwith transactional leadership. Hence the hypotheses for Leadership:H 1 : Transformational leadership has a positive effect on Job satisfaction in SMEsH 2 : Transactional leadership has a negative effect on Job satisfaction in SMEs.2.7.2 Job satisfaction and Organizational CultureOrganizational culture evolves slowly over time and has a powerful influence on behaviorwithin an organization (Slocum and Hellreigel, 2007).Every organization has a predefinedculture which makes the way employees behave vary from a positive to a negative attitudetowards their jobs. Understanding the basics of culture is necessary to understand official andunofficial behavior of employees. According to Wallach (1983) individual outcomes, like jobsatisfaction, depend on the match between an individual’s characteristics and theorganization’s culture. An employee can be more effective in his/ her current job when theculture is appropriate to the business and a certain level of job satisfaction is reached. Thebureaucratic culture is based on power and control which makes it difficult for some17

employees to be satisfied because they are for example achievement motivated. Theseemployees are driven to improve their personal performance and not by doing everything in aregulated and ordered way (Wallach, 1983).The following relationships between organizational culture, Individual motivators and jobsatisfaction can be concluded:Table 2-1 Relationship between Culture, motivators and Job satisfactionOrganizational Culture Individual motivator Job SatisfactionBureaucratic Culture Need for Power and Control SupervisionInnovative Culture Need for Achievement PromotionSupportive Culture Need for Affiliation CoworkersFrom: Wallach 1983- Individuals and Organizations: The culture matchThe table describes the fact that an employee is more efficient in doing the job and will havea greater chance for advancement or being part of the whole when a match exists betweenculture and motivation. This ultimately results in job satisfaction. When an organization has abureaucratic culture, which is based on power and control, the connection is made with thefactor supervision of job satisfaction. Literature (Rashid et al, 2003; Lok & Crawford, 2000,Brewer, 1993; Kratrina, 1990; Wallach, 1983) suggests that bureaucratic culture has anegative effect on job satisfaction, because the need for power and control, often has anegative effect on the satisfaction level of employees. Supervision, in a bureaucratic culture,is than mainly power oriented and when that power is used to control and dominatesubordinates it is often seen as negative (Wallach, 1983). The other two culture aspects arepositively related to job satisfaction because they are experienced as being good workmotivators with their motivation to develop personal performance and to be with others,enjoying shared friendships.Therefore the following hypotheses were formulated:H 3 : Bureaucratic culture has a negative effect on Job satisfaction in SMEs.H 4 : Innovative culture has a positive effect on Job satisfaction in SMEs.H 5 : Supportive culture has a positive effect on Job satisfaction in SMEs.18

2.7.3 Organizational commitment and Job satisfactionAccording to Meyer et al. (2002), job satisfaction is a determinant of organizationalcommitment. Job satisfaction and organizational commitment focus on the feelings and thethoughts employees have towards their work and the organization. The key differencebetween organizational commitment and job satisfaction is that while organizationalcommitment can be described as the emotional reaction which an employee has about hisorganization; job satisfaction is the responses that an employee has about any job. It isbelieved that these two variables are highly interconnected. In other words, while anemployee has positive feelings towards the organization, its values and objectives, it possiblefor him to be unsatisfied with the job he has in the organization. Researchers taking thisposition believe that employee orientations about a specific job inevitably precedeorientations toward the entire organization. Typically, researchers have coupled this viewwith a corollary assumption that compared to organizational commitment, job satisfactionvaries more directly and instantaneously with changing working conditions (Mowday et al.,1982). The relationship between job satisfaction and organizational commitment is veryimportant at the moment because now people often do not wish to continue working for thesame organization for longer periods of time. It is difficult to influence employees to continueworking for the organizations. Similarly, if employees are highly satisfied with their work,coworkers, pay, and supervision, the probability is higher that they are committed to theorganization than if they are not satisfied. These two key concepts are very important becausejob satisfaction and commitment are the main determinants of employee turnover,performance, and productivity (Opkara, 2004). Committed and satisfied employees normallyhave a high performance which contributes towards organizational productivity (Samad,2007). Therefore the following hypothesis is formulated:H 6 : Job satisfaction has a positive effect on Organizational commitment2.7.4 Organizational Commitment and Leadership stylePrior research suggested that leadership is a key determinant of organizational commitment(Mowday et al, 1982). In particular transformational leadership is positively linked withorganizational commitment (Bono & Judge, 2003; Dumdum et al., 2002; Koh, Steers, &Terborg, 1995; Lowe et al., 1996; Walumbwa & Lawler, 2003). Leaders with this leadershipstyle includes employees in the decision making process, they encourage them to be criticaland use different approaches to solving problems and they recognize and appreciate the need19

of each employee to develop their own potential (Avolio, 1999; Bass & Avolio, 1994;Yammarino, Spangler & Bass, 1993).Transformational leaders provide mission and vision;enhance the sense of belonging and devotion so that employees want to stay a member of theorganization. This makes them eager to put in effort for achieving the goals of theorganization. This results in involvement of employees in their work and high organizationalcommitment. Transactional leaders however use rewards to influence employee behavior totheir benefit at low costs or they have a total disregard for what happens in the organizationand do not feel responsible for anything, which often result in dissatisfaction of theemployees. Hence the hypothesis:H 7: Transformational leadership has a positive direct impact on OrganizationalcommitmentTransformationalleadershipH 1H 7TransactionalleadershipH 2Job satisfactionH 6OrganizationalCommitmentBureaucraticH 3cultureH 4Innovative cultureH 5SupportiveCultureFigure 2-2 Conceptual Framework specifying the variables and the research Hypotheses20

3 METHODOLOGY3.1 IntroductionThe literature related to organizational culture, leadership, job satisfaction and organizationalcommitment has been reviewed in the previous chapter. This chapter will give the reader aclear view of how this research was carried out. The philosophy, design and the differentinstruments used for collecting data are described in sections 3.2, 3.3 and 3.4. Furthermorethe selected population and sample size are given in section 3.5. Finally the data analysismethod and the statistical techniques used in this study are presented in section 3.6.3.2 Research PhilosophyThere are several general orientations about the nature of research and on how to executedifferent studies (Creswell, 2003). The nature of this research can be categorized aspositivism. In this type of research a theory is developed, data is collected which eithersupports or contests the theory, necessary revision is done and the theory is tested again.Positivism is when the researcher adopts the position of a philosopher, works with availabledata and the observable reality (de Bono, 2012). Positivism is the best suitable researchapproach because in this research the reality is observed and described from an objectiveviewpoint without interfering with the variables being studied. The researcher relies on therespondent to provide truthful data. Research objectivity is achieved through a strictmethodology, where the data ensures that there is a distance between the subjectivity of theresearcher and the objectivity of the reality which is studied (Cohen & Crabtree, 2006).Based on theory the hypotheses were formulated (deductive approach). Through aquestionnaire the real situation was explored (quantitative data) and the data was analyzed.3.3 Research designThe research design identifies the method of data gathering, which instruments are used, howthey are dealt with and how the gathered information is arranged and analyzed.The intention of this study is to analyze the effect that organizational culture and leadershipstyle (independent variables) have on organizational commitment (dependent variable) withinSmall and Medium sized Enterprises. Job satisfaction, as a mediating variable, could changethe impact that the independent variables have on the dependent variable.21

A descriptive and quantitative research approach was deemed appropriate to gather theprimary data and attend to the research questions. Descriptive research determines andreports the way things are. This choice was made because this research involves investigatingpossible relationships among two or more variables and collecting data to test hypotheses.The variables are measured once through a survey where the opinions of the respondents areillustrated.3.4 Questionnaire design and measuresQuestionnaires assist in gathering information for analyses. Every respondent faces the samequestionnaire with standardized questions and format. This makes measurement accurate andguarantees the collection of comparable data.The questions are designed to be clear and easy to understand. The questionnaires includeitems to measure the different variables of the research model.Specification of the required information is the first step in choosing an appropriatequestionnaire. The different variables are identified through the research questions, theresearch objectives, the hypotheses and the exploratory research done for the literaturereview. The questionnaire is then chosen in accordance with the selected definition for thevariables used in the research.When designing a good questionnaire, questions must be clear and communicate the desiredinformation to the respondents. Double barreled questions, embarrassing questions and biaswords within the questions should also be avoided.The questionnaire is based on the English version of the different instruments, so it had to betranslated to Dutch.3.4.1 Survey administrationPrimary data can be collected through different methods namely mail surveys, telephonesurveys, self-administered surveys, personal interviews, focus groups, observations etc.Choosing the proper method to administer the questionnaire depends on the researchobjectives and the restrictions.The choice for a self-administered survey in this study was based on the advantages anddisadvantages of the different methods and also on the research question and objectives.Survey research through a self-administered questionnaire was the best choice for thisresearch which investigates variables which cannot be directly observed. More than onevariable could be studied at one time in a realistic setting and it is also possible to collect22

large amounts of data. In a self-administered survey the respondents answer the questionsdirectly on the form without the interaction of an interviewer. They complete the form ontheir own, in their own time and pace.The respondent is therefore assured of anonymity and privacy which can increase theprobability of honest answers to the questions.3.4.2 Reliability and validityIn order for results to be usable in further research steps they must be reliable and valid.Reliability is when a measure gives the same outcome, under the same circumstances evenwhen it is measured at different points in time.A qualitative pilot survey is carried out within a small sample of 10 respondents to identifyand eliminate possible problems in the questionnaire. There were different reasons that leadto leaving out some questions. The reliability was tested after the survey was conducted.Gliem and Gliem (2003) (from George and Mallery, 2003:p.231) provided the following ruleof thumb for the Cronbach’s alpha>.9 excellent, >.8 good, >.7 acceptable, >.6 questionable,>.5 poor and

Survey (Spector, 1994), Organizational Commitment Questionnaire (original: Porter, Steers,Mowday & Boulian, 1974 and revised Mowday, Steers & Porter, 1979).Multifactor Leadership Questionnaire (MLQ)This questionnaire was developed by Bass and Avolio (2000) and has been used in studies toestablish the leadership style used in organizations. Respondents were asked to rate theleadership style of the managers with the next highest position to their own. Thequestionnaire contains 45 items of which 36 statements determine the key characteristics ofleadership behavior.From this number 8 were removed after the qualitative pretest due to problems withunderstanding the questions mentioned by pretest respondents. Some of these statementswere:1. Shows that he /she is a firm believer in “if it ain’t broke, don’t fix it”. Most of thepretest respondents did not know this expression. I had to explain what was meant bythis expression and this explanation would not be possible during the selfadministeredquestionnaire;2. Emphasizes the importance of having a collective sense of mission. The pretestrespondents did not know the mission of the company. It was not communicated tothem. One knew the mission, but he was an upper level manager.In the combined instrument 28 items were used to rate leadership style. Some of these itemswere: “Acts in ways that build my respect”, “Keeps track of all mistakes” and “Expressessatisfaction when I meet expectations”.The MLQ has a scale of 1 to 5 with 1 indicating a “not at all” rating of the statement and theother end of the scale 5 indicating a “frequently if not always” rating for the statement (Bass& Avolio, 2005).The Cronbach’s alphas found in this research and the original study, for the MultifactorLeadership Questionnaire were:Table 3-1 Cronbach’s Alpha’s for Leadership styleLeadership style Alpha’s MLQ 5x short form Alpha’s this researchTransformational leadership 0.74 0.76Transactional leadership 0.83 0.72Source: Generated by the researcher24

Organizational Culture Index (OCI)To measure organizational culture the Organizational Culture Index of Wallach (1983) wasused to determine the culture profile of the organization. Wallach classified organizationalculture as bureaucratic, innovative and supportive cultures. This instrument was alsodownsized from a 24 item instrument to an 18 item instrument after pretest respondents hadtrouble understanding and interpreting some of the words in the original instrument. Some ofthe words left out were:1. Sociable: the pretest respondents could not rate the organization on this word becausethey did not think it was appropriate for rating an organization;2. Equitable: they did not know what the word meant. A lot of explaining was neededfor this word;3. Driving: this word was misinterpreted by 9 of the 10 pretest respondents.Other words which were included in the questionnaire to describe the respondents theirorganization were: risk taking, structured and challenging. The OCI has a scale of 1 to 5 with1 indicating a “not at all” rating of the statement and the other end of the scale 5 indicating a“frequently if not always” rating for the statement.The original questionnaire had a 4-point Likert scale which forced the respondent to make achoice (Wallach, 1983). But the questionnaire format with a 5-point Likert scale of thisresearch left an opening for respondents who could not decide. The reliability values of theoriginal research and the current study were:Table 3-2 Cronbach’s Alpha’s for Organizational cultureOrganizational Culture Alpha’s of the OCI Alpha’s this researchBureaucratic Culture 0.71 0.70Innovative Culture 0.87 0.72Supportive Culture 0.77 0.64Source: Generated by the researcherThe Cronbach’s Alpha for Innovative Culture was .67. When assessing the reliability if oneitem is deleted the highest possible reliability was .72 when item 1 was deleted. The itemwhich was deleted regarded the risk taking nature of the company. Innovation is betterdescribed by the other statements like result orientation, stimulation, creativity, challenge andenterprising.25

For Supportive Culture the same procedure was followed and the highest possible reliabilitywhen one item was deleted was .65. This Cronbach’s Alpha was not changed because theimprovement was minimal.Job Satisfaction Survey (JSS)Measurement of job satisfaction was done with the Job satisfaction Survey of Paul Spector(1994). Questions regarding the five main job satisfaction factors (Sempane et al 2002;Kerego & Mthupha, 1997; Hutcheson, 1996; Robbins, 1993), pay, promotion, coworker’snature of the work, supervision were chosen to test the job satisfaction level within thecompanies. The pretest respondents also stated that these five factors mainly determined jobsatisfaction, the other factors seemed far less important to them in the determination of jobsatisfaction.The instrument was thus downsized from 36 items to 20 items representing the five factors.Some of the items included in the questionnaire were: “I feel I am paid a fair amount for thework I do”, “I like the people I work with. These were items regarding pay and coworkers.The JSS has a scale of 1 to 5 with 1 indicating a “strongly disagree” rating of the statementand the other end of the scale 5 indicating a “strongly agree” rating for the statement. Thealphas were as followed:Table 3-3Cronbach’s Alpha from job satisfactionJob Satisfaction Alpha’s of the JSS Alpha’s this researchJob Satisfaction 0.91 0.80Source: Generated by the researcherOrganizational Commitment Questionnaire (OCQ)Employee commitment was measured by the 15-item Organizational CommitmentQuestionnaire (Mowday, Steers, and Porter, 1979), which has been used with a wide varietyof job categories (Mowday et al., 1979).The two subscales, value commitment and commitment to stay, appear to differentiatebetween the respondents' commitment to support the goals of the organization and theircommitment to retain their organizational membership.The OCQ has a scale of 1 to 5 with 1 indicating a “strongly disagree” rating of the statementand the other end of the scale 5 indicating a “strongly agree” rating for the statement. TheCronbach’s Alpha’s in the research using the original questionnaire and this study were:26

Table 3-4Cronbach’s Alpha from Organizational commitmentOrganizational Commitment Alpha’s of the OCQ Alpha’s this researchOrganizational Commitment 0.90 0.75Source: Generated by the researcherAlso important in the design of a questionnaire is the response set-up for measurement. Thereare four different levels of measurement: nominal, ordinal, interval and ratio (NOIR).In the demographic part of this research the nominal scale was used and in the other 4 partsthe interval scale was used.3.4.4 Data processingAfter the questionnaires were collected, they were checked for completeness. Questionnaireswhich were blank or extensively incomplete were barred from processing. From theremaining questionnaires incomplete questions were incorporated as errors and coded with“99” during processing.A total amount of 207 questionnaires were distributed and 197 (95.2%) were returned. Of the197 returned questionnaires 7 were barred and 190 (91.8 %) were processed. The barredquestionnaires were example where more than 50% of the items were not answered or had 2answers to one question.3.5 Research population and SampleWith the purpose of testing the research hypotheses ten (10) companies which qualified asSMEs in Paramaribo, were randomly selected and approached. Eight (8) of these companieswere willing to participate in the research. Due to lack of accurate statistics about the numberof SMEs in Suriname or within a particular sector, company data and other requiredinformation, the researcher chose to select the companies randomly. The company ownerswere first approached and in the first meeting the research was explained and someinformation was collected about the company. This information was needed to determine ifthe company was an SME.The participating companies consisted of construction and production companies, electricalcompanies, a pest control company, a printing company and a hardware store. SMEs havecertain characteristics which makes it possible for researchers to put different organizationtypes together when doing research.27

These companies had the following characteristics in common:1. They have a flat organizational structure which means a smaller management top anda broader base with operational and administrative personnel;2. They had similar managerial styles: they have a smaller more independentmanagement;3.6 Data analysisThe data gathered from the survey was analyzed in SPSS (Statistical Package for SocialScience) version 19. The following analyses were conducted:Table 3-5 Analysis OverviewReliabilityDescriptiveCronbach’s Alpha Frequency CorrelationsDescriptiveMultiple regressionSource: Generated by the researcher3.7 SummaryBased on the kind of research that is done the research methodology is selected. Theapproach used in this study was positivism-deductive approach. This type was considered asthe appropriate approach. The questionnaires were designed, tested and distributed within 8SMEs. The later gathered questionnaires were analyzed on validity and completeness.Furthermore various analyses such as frequencies, correlations, descriptive and regressionwere performed with SPSS.28

4 FINDINGS AND ANALYSIS4.1 IntroductionIn the previous chapter an explanation was given of the method used to gather the data withinthe eight small and medium sized enterprises. In this chapter the data is statistically analyzedand the results are presented in the different paragraphs. In section 4.2 differentcharacteristics of the respondents will be analyzed. In section 4.3, 4.4 and 4.5 the descriptivestatistics, correlation and regression are presented.4.2 Sample population profileDemographic information of sample population, 190 respondents, was gathered throughquestionnaires. The figure below illustrates the gender distribution of 83% male and 17%female respondents with a response rate of 98% for gender.GenderMaleFemale0% 17%0%83%Figure 4-1 The gender response in % of the sample populationFor job level (function) the largest group of respondents is operational level employees (67%)and the smallest group is upper level management (8%). This was expected due to the earliermentioned flat organizational structure of SMEs. The response rate for job level was 93%.29

Function70%60%50%40%30%20%10%0%Operational(workfloor)Administrative personnelSupervisorManager (upper level)Figure 4-2 Job level response in % of the sample populationThe age division of the sample population shows that the majority of the respondents areyounger than 44 years (79%). And more than half of the sample population is younger than34 years (54%). This means that the respondents are relatively young. The response rate forage division was 98%.35%34%30%25%20%15%10%5%20%25%14%5%2%16-2425-3435-4445-5455-64>650%16-24 25-34 35-44 45-54 55-64 >65Figure 4-3Age division in % of the sample population30

Looking at the education level of the sample population it is striking that 88% only finishedthe second part of secondary education (VWO or MBO).The remaining 12% has a higher education level (HBO or University). The response rate foreducation level was 96%.Education level16%7%5%26%primary educationMuloVWO13%MBO33%HBOUniversityFigure 4-4 The education level in % of the sample populationIn the salary division, as can be seen in the figure below 75% of the sample population, earnsless than SRD 2000 a month. Only 5% earn twice as much or more than the earlier mentioned75%. The response rate for salary division was 98%.Salary division70%61%60%50%40%30%20%10%0%14%11%8%3% 3%6000Figure 4-5 The monthly salary in % of the sample population31

In the next figure tenure of the respondent is illustrated. More than half of the respondents(55%) have 5 or less years of service with the company. 12% is working longer than 15 yearsfor the same company. The response rate for years of service was 99%.Tenure45%44%40%35%30%25%20%15%11%28%12%15 years0%15 yearsFigure 4-6 Tenure in % of the sample size32

4.3 Descriptive statisticsThe main characteristics of the data are quantitatively described in the descriptive statistics.In the descriptive statistics summaries about the sample population responses are provided.The mean, median, mode, minimum, maximum, the standard deviation and the skewness inrelation to the independent, dependent and mediating variables are presented in the tablebelow.Table 4-1Independent, Dependent and Mediating variables with the mean, median, mode, standard deviation andskewnessNo Variable No ofMeasuresMin Max Mean Median Mode STD Skew-nessIndependent Variables1 Transformational 15 2 5 3.92 4.00 4.00 .68 -.682 Transactional 13 2 5 3.80 4.00 4.00 .70 -.213 Bureaucratic 6 2 5 3.97 4.00 4.00 .68 -.604 Innovative 6 2 5 4.06 4.00 4.00 .59 -.335 Supportive 6 2 5 4.09 4.00 4.00 .55 -.15Mediating variable6 Job Satisfaction 20 1 5 3.59 4.00 4.00 .70 -.29Dependent variable7 Organizational Commitment 15 2 5 3.84 4.00 4.00 .54 -.30Source: Calculated with the researchers survey dataThe descriptive statistics show that the average respondent is satisfied with their job and thatthey are committed to their organization.In the following sections the inferential statistics analysis will be conducted with parametrictests. This method was chosen after the conclusion that the distribution of the observed datawas fairly similar to a normal distribution.33

4.4 CorrelationCorrelation determines whether and how strong pairs of variables are related. The correlationanalysis can lead to greater understanding of your data. To know whether there is acorrelation between the variables and what the level is of the linear relationship between thevariables, the Pearson R correlation coefficient was examined. This coefficient indicates thedirection and the strength of a linear relationship between two variables. The Pearson’scorrelation coefficient (r) can vary from -1 to +1. The larger the value, the stronger therelationship. A coefficient of +1 indicates a perfect positive relationship and a coefficient of -1indicates a perfect negative relationship. 0 indicates that there is no linear relationshipbetween the variables (Field, 2009).The values for interpretation according to statistics are as follows (Pallant, 2007; Cohen,1988): Rho = .10 to .29 or -.10 to -.29 (small effect) Rho = .30 to .49 or -.30 to -.49 (medium effect) Rho = .50 to 1.0 or -.50 to -1.0 (large effect)To test the hypotheses the p-value was computed. The p-value measures the support (or lackthereof) given by the sample for the null hypothesis. Accepting or rejecting the nullhypothesis relies on the p-value, whether it is smaller than or equal to the significance level.In this case the level of significance is .05. In the following table the correlation values arepresented.34

Table 4-2 Correlation Matrix1 Transactional Leadership 12 Transformational Leadership .383 ** 13 Bureaucratic Culture .247 ** .324 ** 14 Innovative Culture .294 ** .408 ** .516 ** 15 Supportive Culture .182 * .299 ** .383 ** .536 ** 1Correlations1 2 3 4 5 6 7 8 9 10 11 12 136 Job Satisfaction .026 .254 ** .321 ** .239 ** .287 ** 17 Organizational Commitment -.018 .322 ** .308 ** .323 ** .368 ** .488 ** 18 gender -.225 ** -.133 -.226 ** -.147 * -.099 -.159 * -.058 19 function -.086 .033 -.212 ** .038 .149 .034 .234 ** .282 ** 110 age -.249 ** -.038 -.119 .017 -.036 -.067 .183 * -.016 .377 ** 111 education -.187 * -.094 -.287 ** -.126 .055 .007 .192 ** .413 ** .751 ** .099 112 salary -.140 .064 -.153 * .043 .192 * .208 ** .413 ** .155 * .749 ** .563 ** .534 ** 113 Tenure -.119 .052 -.135 -.061 .013 -.049 .094 .067 .183 * .616 ** -.060 .446 ** 1Source: Calculated with the researchers survey data**. Correlation is significant at the 0.01 level (2-tailed).*. Correlation is significant at the 0.05 level (2-tailed).35

4.5 Regression AnalysisIn the previous section the focus was on measurement of the relationships between thevariables. Here the research is taken a step further. In regression analysis we fit a model toour data and use it to forecast the value of the dependent variable from the one or moreindependent variables. This research uses multiple regression analysis (more than onepredictor) to determine the value of the dependent variable.To determine the influence of transformational leadership, transactional leadership,bureaucratic culture, innovative culture and supportive culture on organizational commitmentthe researcher conducted a regression analysis. The model for this research contains amediating variable which intervenes in the relationship between the independent and thedependent variable, the stepwise procedure developed by Baron and Kenny (1986) was usedto test for mediation of organizational commitment The following regressions were analyzed:Step 1Leadership variable –Transformational – (independent, IV) and control variablesagainst Organizational Commitment (dependent, DV)IV M DVOC=Constant+ 1 TF+ 2 Gender+ 3 Function+ 4 Age+ 5 Education+ 6 Salary+ 7 ServiceStep 2 Leadership variables, Culture variables (independent, IV) and control variablesagainst mediating variable Job Satisfaction (M)IV M DVJS=Constant+ 1 TF+ 2 TA+ 3 BC+ 4 IC+ 5 SC+ 6 Gender+ 7 Function+ 8 Age+ 9 Education+ 10 Salary+ 11 Service36

Step 3 Leadership variables, Culture variables (independent, IV), mediating variable (M) JobSatisfaction and control variables against Organizational Commitment (dependent, DV)IV M DVOC=Constant+ 1 TF+ 2 TA+ 3 BC+ 4 IC+ 5 SC+ 6 JS+ 7 Gender+ 8 Function+ 9 Age+ 10 Education+ 11 Salary+ 12 ServiceBefore the results of the regression analysis are given, the researcher will explain somecharacters and terms by giving a simple definition.Constant = the point where the value of the dependent variable relates to a value of zero forthe independent variables. At this point the regression line intersects with the X-axis in thegraph. The constant is the starting value of the outcome when there is no influence from thepredictors and the control variables (Field, 2009:199). = the unstandardized regression coefficient which signifies the strength of the relationshipbetween a given predictor, I, and an outcome in the units of measurements of the predictors.It represents the change in outcome connected with the unit change in the predictor (Field,2009: 781).R square = the coefficient of determination, a measure for how much of the variation inoutcome can be accounted for by the predictors (Field, 2009: 207).Adjusted R square = a measure of the loss of predictive power or shrinkage in regression.This value tells us how much variance in the outcome would be accounted for if the modelhad been derived from the population from which the sample was taken (Field, 2009: 781)37

4.5.1 Regression analysis Leadership style and Organizational CommitmentThe regression of the leadership style, Transformational Leadership, with the controlvariables on dependent variable, Organizational commitment, was performed first. Theresults show that Transformational leadership, salary and tenure have a significant directeffect on Commitment. In the table below the linear relationship between the variables isshown. The equation for this model is:OC = 2.438 + .273* Transformational - .112*Service + .285*SalaryTable 4-3 Regression coefficient Transformational leadership and Organizational CommitmentUnstandardized CoefficientsStandardizedCoefficientsModel Std. Error Betat Sig.1 (Constant) 2.438 .280 8.703 .000Transformational .273 .056 .339 4.886 .000Gender -.011 .117 -.008 -.097 .923Function -.133 .071 -.250 -1.877 .062Age .049 .046 .108 1.053 .294Education .031 .043 .088 .730 .467Salary .285 .058 .591 4.887 .000Tenure -.112 .047 -.236 -2.389 .018Source: Calculated with the researchers survey dataIn the model summary we find that 32.6% of Organizational Commitment can be accountedfor by transformational leadership, salary and tenure. The adjusted R square is .294.Table 4-4 Model Summary Transformational leadership on Organizational CommitmentModel SummaryModel R R SquareAdjusted RSquareStd. Error ofthe Estimate1 .571 a .326 .294 .45298Source: Calculated with the researchers survey data38

4.5.2 Regression analysis Leadership styles, Organizational culture and Job satisfactionThe second regression was executed with Leadership styles, Organizational culture (theindependent variables), the control variables on the mediating variable, Job satisfaction. Theresults showed that Transformational leadership, Salary and Bureaucratic Culture have asignificant effect on Job satisfaction. The table below shows that there is a linear relationshipbetween transformational leadership, salary and bureaucratic culture on one side and jobsatisfaction on the other side. The equation for this model is:JS = 1.923 + .259*Transformational + .266*Bureaucratic Culture+ .342*SalaryTable 4-5 Regression coefficient Leadership styles, Organizational Culture and Job SatisfactionStandardizedUnstandardized Coefficients CoefficientsModel Std. Error Betat Sig.1 (Constant) 1.923 .602 3.193 .002Transformational .259 .087 .243 2.964 .004Gender -.147 .168 -.076 -.875 .383Function -.124 .100 -.186 -1.243 .216Age -.090 .066 -.156 -1.351 .179Education -.030 .060 -.066 -.504 .615Salary .342 .082 .573 4.168 .000Tenure -.061 .064 -.103 -.954 .342Bureaucratic Culture .266 .089 .266 2.979 .003Innovative Culture -.022 .116 -.019 -.190 .850Supportive Culture .042 .116 .035 .361 .719Transactional -.117 .086 -.111 -1.364 .175Source: Calculated with the researchers survey dataThe R square value states that 30.9% of Job satisfaction can be credited to transformationalleadership, bureaucratic culture and salary. The adjusted R square value is .254.Table 4-6Model Summary Leadership styles, Organizational Culture on Job SatisfactionModel SummaryModel R R SquareAdjusted RSquareStd. Error ofthe Estimate1 .556 a .309 .254 .59166Source: Calculated with the researchers survey data39

4.5.3 Regression analysis Leadership styles, Organizational culture, Job satisfaction andOrganizational CommitmentThe last regression involved the whole model with Leadership styles, Organizational Culture(independent), Job Satisfaction (mediating), the control variables and OrganizationalCommitment (dependent). The table showed that transformational leadership, salary,bureaucratic culture, supportive culture and job satisfaction have an effect on OrganizationalCommitment. The equation for the model becomes:OC = .590 + .158*Transformational + .142*Bureaucratic Culture + .192*Supportive Culture+ .209*Job satisfaction + .143*SalaryTable 4-7 Regression coefficient Leadership styles, Organizational Culture, Job Satisfaction and OrganizationalcommitmentUnstandardized CoefficientsStandardizedCoefficientsModel Std. Error Betat Sig.1 (Constant) .590 .436 1.355 .178Transformational .158 .061 .185 2.572 .011Gender .132 .118 .085 1.118 .265Function -.104 .068 -.195 -1.514 .132Age .086 .045 .189 1.908 .059Education .073 .040 .202 1.794 .075Salary .143 .060 .300 2.390 .018Tenure -.060 .044 -.127 -1.363 .175Bureaucratic Culture .142 .063 .178 2.267 .025Innovative Culture .025 .079 .027 .320 .750Supportive Culture .192 .079 .198 2.423 .017Transactional -.034 .059 -.040 -.570 .570Job Satisfaction .209 .058 .263 3.595 .000Source: Calculated with the researchers survey dataThe R square value found is that 50.9% of the organizational commitment can be credited toTransformational leadership, bureaucratic culture, supportive culture, salary and jobsatisfaction. The adjusted R square value is .466.40

Table 4-8Model Summary Leadership styles, Organizational Culture, Job Satisfaction and OrganizationalcommitmentModel SummaryModel R R SquareAdjusted RSquareStd. Error ofthe Estimate1 .714 a .509 .466 .39998Source: Calculated with the researcher survey data4.6 Hypothesis testingThe results from the regression analysis which were presented in section 4.5 are summarizedin the table below.Table 4-9 Summary Regression AnalysisOrganizational Commitment (DV)Model 1 Model 2 Model 3Constant 2.438 1.923 .590Control variables Gender -.011 -.147 .132 Function -.133 -.124 .104 Age .049 -.090 .086 Education .031 -.030 .073 Salary .285 .342** .143* Tenure -.112* -.061 .060Direct effect Transformational Leadership .273** .259** .158*Mediating effect Job Satisfaction .209**Indirect effectBureaucratic culture .266** .142*Innovative culture .042 .025Supportive culture -.022 .192*Transactional leadership -.117 -.034R² .326 .309 .509Adjusted R² .294 .254 .466**p

Research Question 2Research Question 1The table shows that transformational leadership has a direct effect on organizationalcommitment. Furthermore it shows that only 2 of the 5 independent variables namelytransformational leadership and bureaucratic culture have an effect on Job satisfaction. So jobsatisfaction can be seen as a mediating variable.Contrary to expectation the bureaucratic culture has a positive effect on job satisfaction andbureaucratic and supportive cultures have a direct effect on organizational commitment. Therelationships can be considered fairly weak. This model explains 50.9% of organizationalCommitment behavior. An overview of the research questions with their hypotheses ispresented below. Based on the results and formulation of the hypotheses the decision toaccept or reject the null hypothesis is made.Table 4-10Overview Null and Alternative HypothesesHypothesis P - value ResultHypothesis 1H 0 : Transformational Leadership has no effect on p = .004 Reject H 0Job satisfaction within SMEs = .259 Accept H 1H 1 : Transformational Leadership has a positive effect onJob satisfaction within SMEsHypothesis 2H 0 : Transactional Leadership has no effect on p = .175 Accept H 0Job satisfaction within SMEs = -.117 Reject H 1H 1 : Transactional Leadership has a negative effect onJob satisfaction within SMEsHypothesis 3H 0 : Bureaucratic Culture has no effect on p =.003 Reject H 0Job satisfaction within SMEs =.266 Reject H 1H 1 : Bureaucratic culture has a negative effect onJob satisfaction within SMEsHypothesis 4H 0 :Innovative culture has no effect on p =.850 Accept H 0Job satisfaction within SMEs =.042 Reject H 1H 1 : Innovative culture has a positive effect onJob satisfaction within SMEsHypothesis 5H 0 : Supportive culture has no effect on p =.719 Accept H 0Job satisfaction within SMEs =-.022 Reject H 1H 1 : Supportive culture has a positive effect onJob satisfaction within SMEs42

ResearchQuestion 4ResearchQuestion 3Hypothesis 6H 0 :Job satisfaction has no effect on OrganizationalCommitment within SMEsH 1 :Job satisfaction has a positive effect on OrganizationalCommitment within SMEsp =.000 Reject H 0 =.209 Accept H 1Hypothesis 7H 0 : Transformational Leadership has no direct effect onOrganizational commitment within SMEsH 1 : Transformational Leadership has a positive directeffect on Organizational Commitment within SMEsp =.000 Reject H 0 =.273 Accept H 1Source: Calculated with the researchers survey dataLooking at the hypothesized model, it becomes clear that certain relationships are not as wasexpected. There are also new relationships found between the different variables. Anothernoteworthy fact is that Bureaucratic Culture has a direct as well as an indirect effect onOrganizational commitment and the relationship is positive instead of negative. Thefollowing figure shows the hypothesized model adjusted to the results of the regressionanalysis.43

Transformationalleadership.273**.259**TransactionalleadershipNSJob satisfaction.209**OrganizationalCommitmentBureaucratic.266**NS.342*Salary.143*-.112*Tenureculture.142*Innovative culture.192*SupportiveCultureFigure 4.7 Model based on Regression Analysis44

4.7 SummaryDifferent analyses were done in this chapter to test the formulated hypotheses. The firstanalysis was the reliability test. The following test was the analysis of the demographicsgender, function, education level, age, salary and years of employment. There were 3 strikingresults in the demographics. First the high percentage (79%) of young people among therespondents, second the high percentage (88%) of people with secondary education as theirhighest level of education and third the high percentage (75%) of respondent who earns lessthan SRD 2000 a month.In the descriptive statistics part of this chapter the mean, median, mode, minimum,maximum, standard deviation and the skewness were calculated. Thereafter the differentsteps executed in the multiple regression analysis were presented. These led to a few differentrelationships than was predicted in the theoretical framework presented in chapter 2. Thehypotheses were tested and rejected or accepted and the model based on the results of theregression analysis was presented.45

5 DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS5.1 IntroductionThe main goal of this research was to determine what type of Leadership style andOrganizational Culture keeps employees committed to their organization and if jobsatisfaction had a mediating effect in this relationship. In this chapter the results arediscussed, conclusions will be drawn, an implication for theory and management andrecommendations will be given for future research.5.2 Discussion and conclusionsOrganizational commitment is has a big influence on the success of an organization and ishighly valued. Human resources are said to be the greatest asset of an organization. Thatbeing the case than the commitment of human resources should be seen as the organizationscompetitive advantage. To sustain that competitive advantage, organizations need to developa relationship with their employees. Nowadays the attitude of remaining with one employerhas decreased and cut backs are a frequent event. Employees with a higher level of jobsatisfaction are less likely to be absent or to leave.The main research question of this research was formulated as follows: “How and why doleadership style (Transformational, Transactional) and organizational culture (Bureaucratic,Innovative or Supportive) affect organizational commitment in Small and Medium-sizedEnterprises, through Job satisfaction?”With this in mind an elaboration is given on the following results:Transformational Leadership styles has a direct effect on Organizational CommitmentThe results showed that there was a significant direct effect (p=.000, =.273) oftransformational leadership on the level of organizational commitment shown by employees.The expected effect that transformational leadership would have on organizationalcommitment was significant. The workforce within SMEs is usually not large which makes itpossible for leaders to be involved in tasks and consider employees’ individual needs,capacities and ambitions. According to Glisson (1989) leadership explains a great deal of thevariation in Organizational commitment.Transformational leadership has a direct effect on Organizational commitment becausecommitment has been found to be directly dependent on behaviors of the transformationalleaders (Barling 1996).46

Bureaucratic culture has a direct positive effect on with Organizational commitmentThere was little empirical evidence, according to Lok and Crawford (2001), which suggestedthat there was a direct effect from organizational culture on organizational commitment.However for some characteristics of organizational culture, such as corporate beliefs andvalues, a relationship was suggested (Harrison, 1972; Peter & Waterman, 1982; Trice &Beyer, 1993). Still a direct effect for the different types of Organizational culture was notpredicted nor expected, because the researcher did not find significant literature about thisrelationship. In the research of Lahiry (1994) a weak association between Organizationalculture and commitment was found. It is said that organizational culture is too abstract andtoo far from most employees’ everyday activities within their organizational lives (Lok,Wang, Westwood & Crawford, 2007). However the results from this research indicated thatthere was indeed a significant direct effect from Bureaucratic (p=.025; =.142) onOrganizational commitment. The expectation was that the effect of this culture type onorganizational commitment was only mediated by job satisfaction. Another interestingoutcome was that the direct effect of bureaucratic culture was positive. Employees of SMEs,of which the majority is operational, could also be comfortable in a bureaucratic environmentwhere everything is ordered, structured and procedure is well thought out. Authority in SMEsis centered at the top, because the enterprises are usually privately owned and decisions aremade at the top. Information flows from the top down and this supports a culture which isconcentrating on rules and standards for operational processes. The processes are closelymonitored and supervised (Kemble, 2012).Supportive culture has a direct positive effect on Organizational commitmentResearch suggested that there was an effect of Supportive Culture on Job satisfaction(Brewer, 1993; Lok & Crawford, 2000; Kratrina, 1990; Rashid et al, 2003), but not that therecould be a strong positive direct effect (p=.017; =0192) between Supportive Culture andOrganizational commitment. Being supported in everything you do, being able to work in ateam were people are helpful, they are friendly and fair (Lee, 2008) could be some of thereasons why this result was found.47

Transformational Leadership had a positive effect, through job satisfaction, onOrganizational commitmentAll the effects of the independent variables on the dependent variable were expected to beintervened by Job satisfaction. This however was not the case. Transformational leadershiphad a significant effect (p=.004) on the mediator, but also had a direct effect onOrganizational commitment as was predicted. Transformational leadership models reducework stress and raise the morale of employees which result in the promotion of jobsatisfaction (Bass & Avolio, 1990; Northouse, 2001 Waldman et al, 2001). Employeesperform beyond what is expected of them (Medley & La Rochelle, 1995).Bureaucratic culture had a strong positive effect, through job satisfaction, onOrganizational commitmentBureaucratic culture also had a highly significant relationship with job satisfaction (p=.003)but it was a positive relationship instead of a negative one as was hypothesized. Researchdone by Odom, Boxx and Dunn (1990) established that bureaucratic culture neither improvednor reduced an employees’ commitment and job satisfaction. Another explanation could bethat there is a culture match between the employees and the organization as Wallach (1983)discussed. The characteristics like clear lines of responsibility and authority, a solid,regulated and ordered organization with efficient systems could be what employees want,hence the positive effect of bureaucratic culture on job satisfaction and also on organizationalcommitment.The transactional leadership and the other culture type, Innovative culture, did not have asignificant relationship with the mediator, job satisfaction or with Organizationalcommitment. Most SMEs do not have a research and development department, so jobsatisfaction due to an Innovative culture is not likely to occur. On the other hand the controlvariable salary division also has a highly significant positive effect (p=.000; =.342) on jobsatisfaction. A high salary often, if not always, leads to a satisfied employee.The direct relationship between Job satisfaction and Organizational commitmentJob satisfaction had a significant direct and positive effect on Organizational commitment.When employees are satisfied they are most often also committed to the organization. Inliterature job satisfaction is said to have the largest effect on commitment. In this research Job48

satisfaction also has the largest effect on Organizational commitment when we look at theregression of the whole model. This factor needs to be strengthened to enhance commitmentof the employees to an organization.Salary division and Tenure had a significant direct positive effect on OrganizationalCommitmentSalary division and years of employment (tenure), two of the control variables, also had asignificant direct effect on organizational commitment. Salary division has a positive directeffect on commitment and tenure has a negative direct effect. This was also the case in earlierresearch (Allen & Meyer, 1990; O’Reilly , Chatman & Caldwell, 1991) where employeesstated that if they get the pay they deemed fit for their supposed job input which includesskills, effort, experience and present performance they would stay with the organization.However it is striking that the longer some employees stay with a company the lesscommitted they get. One would think that the opposite is the case, the longer you work for acompany the more committed you are to that company.The result that tenure has a negative effect could be attributed to the fact that employees onlystay with the organization because they have nowhere else to go to.This could be the commitment for where employees stay with the organization because theyought to; they feel obligated to stay (Allen and Meyer, 1991). A reason for this withdrawalcould be that front line employees get less satisfaction from their job as the years progress.The work could have become monotonous to them because there were few training anddevelopment programs available (Kemble, 2012).5.3 Implications for Theory and PracticeThe findings of this thesis research have implications for both theory and practice. All resultsare discussed in the previous sections and conclusions are drawn. This section addresses thereasons why this research is relevant for theory and practice.Theoretical ImplicationsThe theoretical importance is found in the fact that this research showed that certainrelationships are not always what theory has found. Every situation, organization, employeeand leader is different. Investigating the concepts alone and/or in different relationships withother variables will result in greater understanding of organizational and employee behavior.49

When conducting the research it became clear that the SMEs differ significantly from largecompanies. The structure, the communication lines, how employees experience leadershipand their level of job satisfaction and commitment are all different.Statistical and company information should be made available for students who want to doresearch in the field of SMEs. The chamber of commerce should obtain and structure theinformation which should be made available to everyone who wants use it for researchpurposes. This study also is an addition to the few inquiries about organizational andemployee behavior in SMEs. Also the finding that Bureaucratic culture has a positive effecton Job satisfaction and Organizational commitment as well as the framework conditions,where this result was found, are of importance to theory.Practical ImplicationsIt is important to keep employees committed and retain their strengths and sustainproductivity, which guarantees the stability of an organization. SMEs are seen as thebackbone of the economy so they need to maintain active. The ability of to lead anorganization now has a lot of challenges and demands.This study could offer a useful guidance for SMEs on the researched topics. Managers coulduse the information to improve or change their leadership style and the culture of theorganization. Attention should be paid to the following specific results: Tenure having a negative effect on Organizational Commitment. Employees need tobe trained, so that they have different opportunities. If an employee stays with theorganization because he feel obligated to stay it is not a healthy situation for anyparty; Bureaucratic culture having a positive effect on job satisfaction and Organizationalcommitment. This is a surprising result and needs to be looked at carefully. Theemployees within SMEs could want a structured and ordered environment to thrive in.this makes them worry less about chance of not having a job tomorrow; The other found effects were expected but still need to be looked at and improved orchanged if needed within the organizations.50

5.4 RecommendationsBased on the results presented earlier in chapter 4 the following recommendations could bemade: More studies should be conducted on organizational and employee behavior in SMEs.This could improve this could improve the life span of the organization; Further research should be conducted to other concepts that influence OrganizationalCommitment. Leaders should realize that influencing the commitment of employeesleads to higher performance and lower turnover rates among other things. Institutions, such as the chamber of commerce, central bureau for statistics, shouldrealize the need for specific and adequate information about SMEs. Establishingcountrywide recognized criteria for SMEs in Suriname and communicating thosecriteria to those specific organizations; Leadership in organizations should be assessed and managers should become awareof what is needed to obtain positive results from employees in order to improveperformance.51

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APPENDIXa

Appendix A: Introduction of the researcher to the questionnaire respondentParamaribo, December 2012Dear Participant,I am Danielle Griffith-Kranenburg, a student at FHR Lim A Po Institute for SocialStudies in Paramaribo. In order to finish my study Master of Business Administration inManagement and Business Strategy, I need to conduct research.My research is about the effect that organizational culture and leadership style have onorganizational commitment and what role job satisfaction plays in these relationships.Your input is important to this research because it will help form an overall picture ofhow employers can work towards having satisfied and committed employees.This questionnaire is developed to gather information for the purpose of this research.It will take an average of 20 – 25 minutes to fill it out. Your answers will be handledstrictly confidential and will exclusively be used for the purpose of this research.Therefore I request you to answer the questions as honest and objective as possible inorder to contribute to the success of this research.Many thanks for your time and support.Danielle Griffith- Kranenburg BSc.b

Appendix B: The QuestionnairePart 1 LeadershipThis part of the questionnaire is to describe the leadership style of your supervisor as youperceive it. Please answer all items on the answer sheet. Judge how frequently each statementfits the person you are rating. Use the following scale:1= not at all2= once in a while3= sometimes4= fairly often5=frequently, if not alwaysMy leader/ManagerScale1. Provides me with assistance in exchange for my efforts 1 2 3 4 52. Re-examines critical assumptions to questions whether they areappropriate1 2 3 4 53. Fails to interfere until problems become serious 1 2 3 4 54. Focuses attention on irregularities, mistakes, exceptions anddeviations from standards1 2 3 4 55. Avoids getting involved when important issues arrive 1 2 3 4 56. Talks about their most important values and beliefs 1 2 3 4 57. Is absent when needed 1 2 3 4 58. Discusses in specific term who is responsible for performancetargets1 2 3 4 59. Waits for things to go wrong before taking action 1 2 3 4 510. Talks enthusiastically about what needs to be accomplished 1 2 3 4 511. Specifies the importance of having a strong sense of purpose 1 2 3 4 512. Spends time teaching and coaching 1 2 3 4 513. Makes clear what one can expect to receive when performancegoals are achieved1 2 3 4 514. Goes beyond self interest for the good of the group 1 2 3 4 515. Demonstrates that problems must become chronic before takingaction1 2 3 4 516. Acts in ways that build my respect 1 2 3 4 517. Considers the moral and ethical consequences of decisions 1 2 3 4 518. Keeps track of all mistakes 1 2 3 4 519. Displays a sense of power and confidence 1 2 3 4 520. Articulates a compelling vision of the future 1 2 3 4 5c

Part 1 Leadership21. Directs my attention towards failure to meet standards 1 2 3 4 522. Considers me as having different needs, abilities andaspirations from others1 2 3 4 523. Gets me to look at problems from many different angles 1 2 3 4 524. Helps me to develop my strengths 1 2 3 4 525. Suggests new ways of looking at how to complete assignments 1 2 3 4 526. Delays responding to urgent questions 1 2 3 4 527. Expresses satisfaction when I meet expectations 1 2 3 4 528. Expresses confidence that goals will be achieved 1 2 3 4 5d

Part 2 Organizational cultureFor each item identified below, circle the number that most closely describes how you seeyour whole organization.Use the scale below to select the quality number.1=not at all2 = once in a while3 = sometimes4 = most of the time5 = frequently, if not AlwaysMy organization is:Scale1. Risk taking 1 2 3 4 52. Collaborative 1 2 3 4 53. Hierarchical 1 2 3 4 54. Procedural 1 2 3 4 55. Relationship - oriented 1 2 3 4 56. Results - oriented 1 2 3 4 57. Creative 1 2 3 4 58. Encouraging 1 2 3 4 59. Structured 1 2 3 4 510. Stimulating 1 2 3 4 511. Personal freedom 1 2 3 4 512. Safe 1 2 3 4 513. Challenging 1 2 3 4 514. Enterprising 1 2 3 4 515. Established, solid 1 2 3 4 516. Cautious 1 2 3 4 517. Trusting 1 2 3 4 518. Power - oriented 1 2 3 4 5e

Part 3 Job satisfactionFor each item identified below, circle the number to the right that comes the closest toreflecting your opinion about it.Use the scale below to select the number.1= disagree very much2 = Disagree3= Can’t decide4 =Agree5 = Agree very muchOn my present job this is how I feel about ……….Scale1. I feel I am being paid a fair amount for the work I do 1 2 3 4 52. There is too little chance for promotion on my job 1 2 3 4 53. My supervisor is quite competent in doing his/her job 1 2 3 4 54. I like the people I work with 1 2 3 4 55. I sometimes feel my job is meaningless 1 2 3 4 56. Raises are too few and far between 1 2 3 4 57. Those who do well on the job stand a fair chance of beingpromoted1 2 3 4 58. My supervisor is unfair to me 1 2 3 4 59. I find I have to work harder at my job because of theincompetence of people I work with1 2 3 4 510. I like doing the things I do at work 1 2 3 4 511. I feel unappreciated by the organization when I think aboutwhat they pay me1 2 3 4 512. People get ahead as fast here as they do in other places 1 2 3 4 513. My supervisor shows too little interest in the feelings ofsubordinates1 2 3 4 514. I enjoy my coworkers 1 2 3 4 515. I feel a sense of pride in doing my job 1 2 3 4 516. I feel satisfied with my chances for salary increases 1 2 3 4 517. I like my supervisor 1 2 3 4 518. I am satisfied with my chances for promotion 1 2 3 4 519. There is too much bickering and fighting at work 1 2 3 4 520. My job is enjoyable 1 2 3 4 5Part 4 Organizational Commitmentf

Part 3 Job satisfactionListed below is a series of statements that represent feelings that individuals might haveabout the company or organization for which they work. Circle a number from 0 to 4using the scale below.1= Strongly disagree2 = disagree3= Can’t decide4 = agree5 = strongly agreeIndicate your feeling about the organization you are working forScale1. I am willing to put in a great deal of effort beyond which isnormally expected in order to help this organization besuccessful.2. I talk up this organization to my friends as a greatorganization to work for.1 2 3 4 51 2 3 4 53. I feel very little loyalty to this organization. (R) 1 2 3 4 54. I would accept almost any type of job assignment in order tokeep working for this organization.1 2 3 4 55. My values and the organization’s values are very similar. 1 2 3 4 56. I am proud to tell others that I am part of this organization. 1 2 3 4 57. I could just as well be working for a different organization aslong as the type of work was similar. (R)8. This organization really inspires the very best in me in theway of job performance.9. It would take very little change in my present circumstancesto cause me to leave this organization. (R)10. I am extremely glad that I chose this organization to work forover others I was considering at the time I joined.11. There’s not too much to be gained by sticking with thisorganization indefinitely. (R)12. Often, I find it difficult to agree with policies on importantmatters relating to this organization (R)1 2 3 4 51 2 3 4 51 2 3 4 51 2 3 4 51 2 3 4 51 2 3 4 513. I really care about the fate of this organization. 1 2 3 4 514. For me this is the best of all possible organizations for whichto work.15. Deciding to work for this organization was a definite mistakeon my part. (R)1 2 3 4 51 2 3 4 5g

Below are some questions to get a better overall view of the respondent. Please note that all dataremains anonymous.1. What is your gender? Male Female2. What is your current job category within the organization? Operational(work floor) Administrative personnel Supervisor (middle management) Manager(upper management)3. What is your age range? 16 – 24 25 – 34 35 – 44 45 – 54 55 – 64 >654. What is the highest level of education you have completed? PRIMARY EDUCATION MULO VWO MBO HBO UNIVERSITY5. What is your average monthly salary range (in SRD)? 60006. Which range indicates the number of years you are employed within the organization? 15 yearsh