Impact of Organizational Commitment on Job Performance

 

Mina Talib Beigi¹, Dr. Seyed Jalil Lajevardi²

¹Graduate Master of Executive Management Shahid Beheshti University, Tehran, Iran.

²Science Committee Assistant Professor, Shahid Beheshti University Faculty of Management and Accounting, Tehran, Iran.

 

ABSTRACT:

The purpose of this study is to identify the impact of organizational commitment on job performance together with job satisfaction. The key issues which are considered in this study were organizational commitment as an independent variable, job performance as the dependent variable, and job satisfaction as a mediator variable. This study focuses on the model of organization commitment created by Meyer and Allen in 1984 for two reasons; to aid in the interpretation of existing research and to serve as a framework for future research. There are three dimensions in this model; Affective Commitment, Continued Commitment, and Normative Commitment. Researchers have discovered new findings to describe the relationship between commitment and performance, and organizational commitment is one of the factors that affect job performance. Empirically, job satisfaction is a mediator variable for organizational commitment and job performance, because major differences have been found between organizational commitment and job satisfaction. The results of this study will be valuable for any organization aiming to accomplish a high rate of job performance, to create a desire for employee to work with their organization as well as the willingness to stay in the organization. The data collected from 120 respondents through questionnaires-- which was the sole instrument of the main survey—was reliable and validated. As a result, positive pairwise correlations have been found between organizational commitment with job performance and job satisfaction, which is something that a company is enthusiastic to establish. Organization commitment as a single variable demonstrated the highest correlation with job performance, whereas normative commitment showed lowest correlation with job performance. Also, job satisfaction partially mediates the relationship between organization commitment as a single variable and job performance, whereas such effect for the relationship between organization commitment dimensions and job performance could not be found.

 

 

 

INTRODUCTION:

Researches on organization date back around 1950s. Over the recent two decades, literature of organizational behaviour and industrial/ organization psychology has been grown the notion of organizational commitment because this concept is a significant part for psychosocial state of employees. Employees who possess high organizational commitment can engage in much behaviour which is valuable and beneficial for that organization such as high job performance and citizenship activities (Chung, 2001). 

 

Organization is contained people in social module that is managed and structured to encounter a requirement or to follow collective aims. There is management structure in all organization to distinguish relationship between the members and different activities and determines responsibilities, authority and roles to perform various tasks. Organization can be created a desire for employee to stay as a member of the organization. Managers must create commitment in their organization to modify business environment. This environment has been shifting and request organization to possess high competiveness. As it is clearly, the committed employee is a competitive advantage in this condition for organization so it can be affected for global competition in the future. Organizational commitment refers to loyalty and attachment. It is related by individuals’ sense about their organization. Salancik (1977) explained that commitment can be enhanced to take support for goals and interest of organization.

 

Researches by Allen and Meyer in 1990 and Brown in 1969, indicate that organizational commitment has concentrate in the attachment of employee to the work environment, the important factors helping to the attachment, and the results of this attachment.  The more committed will eventuate more attempt of employees for carrying out the task which related to work. In the fundamental belief, there is a direct relationship between organizational commitment and employees’ performance in the job. In the other word, the amount of organizational commitment is positively connected to job performance or intent of quit.

 

Affective Commitment is defined as the employees have a positive sensitive attachment with their organization. In this dimension, the goals of organization are the objective of employees and when they do not accept the offer a new company even with more financial attractiveness. They think true organizations act as their own organization. These employees belong to the organization because they “want” not by forces or limitations. Becker in 1960 asserted in his study that employees never have emotional commitment to the organization, but they continue their work to avoid losing the salary and status.

 

Committed employees behave and perform on accomplishing goals of organization, so they give a huge contribution to organization. These committed employees are delighted to be a member of their organization and strive to do best actions are the best for organization. The investigation of organizational commitment and job performance of employees is the most significant issues for management in the top-level of organization. Somers and Birnbaum in 1998 found the positive relationship between the organizational commitments to job performance. Job performance, based on business dictionary, is when the employees perform their responsible well. Performance is so significant criteria that resulted from organizational success and outcome.  It is clear that each organization aim to accomplish high rate of job performance. The factors that impact on job performance are too many things; they may have negative or positive affect.  The main factors that have important rule for job performance are divided into two parts; internal and external. Internal factors are happened to the employees while at work. 

 

Also, Job satisfaction is a mediator variable for organizational commitment and job performance. Job satisfaction is defined affirmative feeling which employee possess towards his/her job or in the other words, loyalty and satisfaction which have to their responses.  So, that is a general attitude of employees to their job and it relates to elements or events which is attached importance by employees. Some elements can be mentioned as individual variable for job satisfaction are age, gender, marital status, education and personality, promotion, wage, job’s characteristics and working condition.

 

A determinant of organizational commitment could be job satisfaction. There is just one and more important difference between organizational commitment and job satisfaction. Organizational commitment can be described as the emotional reaction that employees have towards the organization but in job satisfaction, this emotion can be related towards any job. So these concepts are as two variables with highly interdepend. So, it is possible that employees have positive emotion to the organization that is its objectives and value, but they do not be satisfied their job in that organization. In the subject of job satisfaction, managers should take into consideration. According to some studies that are done for this relationship, minimizing organizational commitment can play a significant role in going up the quality of service and decreasing the problem that occur in human resource management. Someone requires job satisfaction in doing their job because when the job can able to provide satisfaction, then the employees work better and better for producing good performance. Theoretically, three reason of the significance of the job satisfaction in the organization are, first, there is no care for unsatisfied employees with the job and perhaps resign. Secondly, satisfied employees possess long life and better health. Thirdly, job satisfaction will include life outside the job. The predictors and correlates of organizational commitment are as well as predictor and correlates for job satisfaction and contrariwise.

 

High priority goals of an organization are productivity and efficiency to attain of high-level performance. Another factor that related to high performance is to incept the satisfied worker. Satisfied employees conduct to spread more effort to job performance. Satisfied workers possess positive trend to work speedily, on time, more interest about the given aims, commitment and loyalty to the work, recommend new idea, work free of omissions and mistakes, attitude to improve knowledge, less dependability and absenteeism, subordination of role and regulation, and effort to keep in the present situation in the organization. These positive trends will enhance the quantity and quality of worker’s performance.

 

Iles and Suliman (2000) by utilizing job performance of employees and several demographic variables explored organizational commitment among three industries. This investigation manifested there is not any link between three components of organizational commitment (affective, normative and continuance commitment) and job performance. Chen, Hung and Silverthorne (2006) investigated about the correlation between job performance and organizational commitment. However, they found organizational commitment is positively and strongly related to job performance. This detection also recommended organization can utilize communication processes and channels to strengthen their commitment and performance. Based on the Clarke’s study (2006) at health care units of UK about performance and commitment, there is a distinguished role of commitment on performance. In this research, other finding was about the positive impact of normative and affective commitments on job performance statistically but negative impact of third component of commitment; continuance commitment on job performance.  An investigation that was designed in Malaysia by Johari, Rashid and Sambasvani (2003) among 202 managers about this topic, the finding was in term of influences of organizational commitment a Fernando et al. (2005) explained that there is a positive and direct correlation between job satisfaction and organizational commitment. Ayeni and Phopoola (2007) found the same discovery of Fernando et al. on corporate culture to performance as interdependent.

 

The purpose of this study is to identify impact of organizational commitment on job performance.

1)    What is the relationship between organizational commitment and employees’ job performance?

2)    Which type of organizational commitment has more effect on job performance?

3)    What is the relationship between organizational commitment and employees’ job satisfaction?

4)    What is the relationship between job satisfaction and employees’ job performance?

 

METHODOLOGY:

This research examines impact of organizational commitment on job performance; the study is classified as hypotheses testing or explanatory study.

This investigation is a quantitative type of study and its aim is to found out the relationship between independent variable, which includes organizational commitment (affective, continuance, and normative commitment) and also, job performance as it is considered as a dependent variable. In this study, job satisfaction examines as a mediator variable. The subjects have a descriptive design and it will just be measured once. Based on the literature review, three types of variables were designed, which are linked to research problem. Three variables contain organizational commitment (affective, Continuance, and normative commitment) as independent variables, job satisfaction as a mediator variable, plus job performance as a dependent variable. Data sources for this research are from primary and secondary data. These data are gathered via paper-based questionnaire and survey which they distributed to the respondents. In the part of secondary data, each investigation should be used this form of data in the literature review. These data is created from the relevant books, online articles and magazines, newspapers and journals. The mentioned journals are chosen from Emrald, Ebsco, ProQuest, and Science Direct journal databases.

 

The sample of this study is narrowed down to those people who are working the organization in Malaysia and they are daily faced to this issue. This sample is included foreigners and local employees. Ergo, the paper-based questionnaires are distributed among the employees in Malaysia. The research sample includes of 120 respondents collected via online and offline questionnaire. The location of distribution for paper-based questionnaire is only in Malaysia. The region selected is KL, Malaysia. Also, online respondents are the employees who live in Malaysia. The gathered data is analysed by SPSS software.

 

FINDINGS:

The results show that 38.3% of respondents are female and 61.7% are male. This result shows participants are divided fairly where 42.5% are below 24 years old, 26.67% between 25 and 30, 20% between 31 and 36 and the rest are above 37 years old. Also, respondents have been asked to clarify their position in their respective company. Accordingly, based on the four categories provided in the questionnaire, almost the majority (two of third) of participants by a 64.17% were employees. The rest were 18.33 of junior managers, 8.33% of supervisors, and 9.17% of senior managers. Such profile of respondents is provided in following table and pie chart. Their experience also is asked and organized based on four categories. These were less than 1 year, 1-3 years, 3-6 years and above 6 years. Table 1 shows that the 33.33%, 26.7%, 15.8%, and 24.2% for different categories of than 1 year, 1-3 years, 3-6 years and above 6 years respectively.  120 people were included in our survey. Out of total sample, 3.3%, 30.8%, 1.7%, 34.2%, 18.3%, and 11.7% were high school diploma, foundation, degree, master, and Ph.D. holders, respectively. This result shows participants are mostly degree and master holder by a 65% of total sample size.

 

Table 1. Reliability measures for the main survey - Sample size=120

 

In terms of job performance as dependent variable of this study and as the figure presented in Table 3, following has been found:  A significant positive correlation between Job performance (J.P.) and Organization Commitment (O.C) (r= 0. 733, p=.000) has been found, therefore H1 is supported. A significant positive correlation between Job performance (J.P.) and affective Commitment (A.C) (r= 0. 734, p=.000), has been found, therefore H1 is supported.

 

Table 2. Analysis of Variance (ANOVA)

A significant positive correlation between Job satisfaction (J.S.) and Organization Commitment (O.C) (r= 0.681, p=.000) has been found, therefore H2 is supported.

 

Table 3 Bivariate correlations between constructs

**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

 

model 1, regressing Job satisfaction on organization commitment, affective commitment, continuance commitment, and normative commitment; model 2, regressing job performance on organization commitment, affective commitment, continuance commitment, and normative commitment; and model 3, regressing job performance on organization commitment, affective commitment, continuance commitment, normative commitment, and Job satisfaction. Separate coefficients for each equation were estimated and tested. Based on recommendation by Sekaran and Bougie (2010) to establish mediation the following conditions must hold: Organization commitment, affective commitment, continuance commitment, and normative commitment must affect Job satisfaction in model 1. Also, Organization commitment, affective commitment, continuance commitment, and normative commitment must be shown to impact job performance in model 2

 

 

 

Step1 model, with job satisfaction as the dependent variable

 

Step2 model, with job performance as the dependent variable

 

Step3 model, including Job satisfaction as an independent variable and with job performance as the dependent variable

Step4 model including  Job satisfaction as sole independent variable and with job performance as the dependent variable

	Variables	Beta	t	P	R2	Adjusted  R2	F	Sig. F
	(Constant)		5.645	.000	0.176	0.169	25.275	0.000
	Job satisfaction	.420	5.027	.000
Model Fit =  0.169
Note. Parameters are standardized regression weights, with significance levels of t-values. Two sided tests. N=120.

 

This result (table 4.31 and 4.32) shows that normative commitment affect job performance through job satisfaction. However, the effect of job satisfaction on job performance is perfectly mediated through affective commitment and continuance commitment. In terms of organization commitment as a single variable, it would be said job satisfaction partially mediates the relationship between organization commitment and with job performance.

 

Hence, if a high job performance in workplace is a top priority for a manager, it is important to formulate policies and practices that help to enhance affective and continuance commitment. Also, whatever is done to improve employees' normative commitment will improve job satisfaction. Thus, it would be recommended to manager to enhance and improve commitments in the system if there is shortage or clear misperception of commitments if they exist and are the case. Enhancing job performance and job satisfaction as well, may require both individual and organizational change. To address issues of job performance, the managers may need to change the work environment and educate workers on how to adapt and cope better to the workplace.

 

Nonetheless, based on the results, only 32.3% of variation in job performance was explained by the four variables of current study, yet another 77.7% of variance has been left unexplained. Thereby, other variables could be introduced and added to the model that might be important in explaining job performance and have not been studied in this work. Future research is needed to explain more of the variance in variable of study as performance, if practitioners are willing to investigate the matter further.

 

CONCLUSION:

Although positive correlations have been found between all predictors and job satisfaction in one hand and job performance on the other hand, yet the result of significant effect is different.  Based on the result of regression analysis presented in table 4.32, only affective and normative commitment are significant predictors of job satisfaction whereas the impact of continuance commitment on job satisfaction is not significant determinant of variation in job satisfaction. In simple terms, if solving the problem of job satisfaction is desired in a population same as the one which has been studied in this work, there is a need to invest heavily on affective commitment which is salient predictor of job satisfaction with a beta of 0.534. This means 53.4% of variation in job satisfaction will be determined by variations in affective commitment. Besides, the salient effect of normative commitment on job satisfaction should not be overlooked where a beta of 0.235 shows almost quarter of variation in job satisfaction is determined by this variable. However, since the budgets in the companies are limited, based on the result it is recommended to policy makers to do not invest on issues regarding continuance commitment which won’t have any significant impact on job satisfaction. Alternatively, the results of correlation analysis demonstrate that correlation coefficient for the association between continuance commitment and job satisfaction, though significant, is rather low. In fact, implementing practices that can improve job satisfactions are not easy to employ. It requires full commitment from several parties involved in an organization and demands some changes and restructuring that is time consuming. Therefore, it is advised to practitioners to practice the activities that can improve the perception of affective and normative commitment while stimulating employee to increase commitment which consequently will yield in increase in overall perception of job satisfaction. Since such decisions of improving perceptions, demand a top management commitment, the first step could be to stat with motivating senior managers to employ and practice such policies. In this case lack of decision makers’ support and commitment is one of the major causes of the failure.

 

In terms of job performance and its antecedents, considerable correlations have been found between the criterion variable of this study and predictors including job satisfaction. It should be noted that in this study three different dimensions of organization commitment and their relationship has been studied separately, and in another stage, the association between organization commitment as a single variable with job performance has been examined.  The result showed organization commitment as single variable demonstrate a higher correlation with job performance. However, such correlation with job satisfaction is second largest correction after of what is about affective commitment. Within all correlations, normative commitment showed lowest correlation with job performance, which means less variation in job performance would be predicted by variation in this variable. Therefore, if job performance in a company is rather low and managers are willing to enhance performance, it would be advised that much attention should be paid to overall organization commitment issues and perception and affective commitment should be taken into account. This also could be drawn that affective commitment has a high correlation with both job performance and job satisfaction. Therefore, if manager are forced to improve the commitment and they are short in time and budget, it is better to invest heavily on develop strategies in regard to affective commitment. This can alone improve the performance and level of satisfaction of employees. Also, result of regression analysis presented in previous chapter in Table 4.31 shows that affective commitment has a significant beta equal to 0.534 and 0.369 in regard to both job satisfaction and performance respectively. However, the effect of continuance and normative commitment are both salient as well. Based on the researches of Khan et al. (2010), job performance and continuance commitment are directly related and also the same result was found about the impact of normative commitment on job performance and vice versa. Alternatively, considering organization commitment as s single variable also depicts that this variable has a strong causal effect on both job satisfaction and performance, though the effect on job satisfaction is slightly bigger.  Therefore, in order to job performance and job satisfaction both demand the mutual cooperation of all staff in an organization as well as their commitment. In fact, ameliorating one aspect will highly cause the enhancement in the other one.  In other words, managers should provide an environment that could meet the needs and expectations of employees in order to stimulate them for higher commitment levels. All these are also very much dependent on management style and organizational culture.

 

As far as mediation effect of job satisfaction is concerned, it would be added it partially mediates the relationship between organization commitment as a single variable and job performance. It means, other than the direct effect of organization commitment which has been already discussed, it has an indirect effect through job satisfaction on job performance, thus the total effect of organization commitment on job performance increases meanwhile, it can simultaneously improve the perception of employee in terms of their satisfaction.

 

When the mediating effect of job satisfaction has been assessed for the three dimensions of organization commitment, surprisingly the result was in contrast of hypothesized propositions. Unexpectedly, procedure revealed that affective and continuance commitment fully mediated the relationship between job satisfaction and job performance.  Based on the researches of Khan et al. (2010), job performance and continuance commitment are directly related and also the same result was found about the impact of normative commitment on job performance and vice versa. Since, the affective commitment demonstrated a high correlation with job performance and satisfaction, such result is not far from expectations. Nevertheless, literature is priority rather than statistical results. In fact, this finding is one of the limitations of current study which recommend future research to investigate the matter further. Several, conditions can make these issues possible, for instance the homogeneity of participants, especially, where the data collection method of this study had been considered to be convenient sampling.

 

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