Critical Factors for Organizational Commitment: An Empirical Study in Vietnam

Abstract

How to manage a business effectively and successfully is the most important goal of all businesses on their way to expand and develop. Most researchers have confirmed that highly committed employees may perform better than less committed ones. The paper aims to find out what critical factors really affect employee's commitment for success of a business. The findings show that three factors having impacts on organizational commitment are leadership, meeting effectiveness and job satisfaction. Particularly, leadership positively affects meeting effectiveness with weight of 0.838. It is believed that if employees feel satisfied with their job, they become more committed to their organization. In addition, it is evident that meeting effectiveness positively affects organizational commitment with weight of 0.296. Last but not the least, in the relationship between meeting effectiveness and organizational commitment, there is a mediator of job satisfaction with the indirect effect of 0.454 and its bootstrap errors at 0.053. It emphasizes the importance of meetings in workplaces. In order to make subordinates satisfied with their jobs, every conflict or problem needs to be thoroughly resolved in meetings. That's why meeting effectiveness has a significant effect on job satisfaction. Furthermore, whether meetings are effective or not is based on leaders or meeting organizers.

1. Introduction

The practice of strategic management has become one of the most interesting subjects for most research papers. How to manage the business effectively and successfully is the vital goal of all businesses on their way to expand and develop (Hornsby & Kuratko, 1990). Bowen and Morara (2009) states that SMEs have been faced with the threat of failure and challenges of competition themselves and from large firms (Bowen et al., 2009).To be successful, businesses have to do a mix of strategies in advance for both external and internal factors, especially for human resources management (Guest, 2010; Hornsby & Kuratko, 1990; Lussier & Pfeifer, 2001). The previous studies show that strategic management factors along with organizational commitment increase the performance of employees and work achievement (Rustamasji, 2018).

Job satisfaction, leadership, meeting effectiveness and organizational commitment are the main factors for this research journey. It is believed that there is an integrated relationship among them. In every organization, meetings are the common activities for a variety of purposes such as performing and reaching vital goals, communicating and exchanging ideas or making changes and similar activities. However, most meetings are considered to be ineffective even though much time and effort is devoted (Allen, 2012). Actually, from the literature of meeting effectiveness, leaders or meeting organizers play the very essential role (Nixon & Littlepage, 2014). For instance, whenever conflicts occur in a meeting, leaders or meeting organizers will be those who make the final decision. They control whatever activities during the discussion time. Most conflicts on work can be peacefully resolved through meetings. If given-solutions aim to improve team effectiveness, they will bring positive experience and benefits to related-problem members (Esquivel & Kleiner, 1996; Guetzkow & Gyr, 2015). Thanks to meetings, subordinates feel satisfied with their job because during interactions, they have chances to exchange information, clarify ideas, build common ground, contribute ideas and so forth (Meinecke & Lehmann, 2015). In fact, effective meetings will encourage subordinates to contribute more efforts and increase more commitment to their workplace. In other words, if subordinates feel satisfied with their jobs, they will express their strong desire to keep the membership with their organization (Mowday et al., 1978; Steers, 1977).

The paper aims to find out what critical factors really affect organizational commitment for business success. The study has been conducted to demonstrate the interactions and relationships among these main constructs, which are leadership, meeting effectiveness, job satisfaction and organizational commitment. The authors design a survey based on the three research questions: How to make meetings more effective? How does meeting effectiveness affect organizational commitment? What will mediate the influence between meeting effectiveness and organizational commitment? This study contributes to the body of the literature in the field of meeting effectiveness, job satisfaction and organizational commitment from theoretical perspective. Even though, the concept of meeting has become popular these days in academic research environment worldwide due to its essential role in working life, it is still rather subdued in Vietnam. Furthermore, the interaction and relationship between meeting effectiveness and organizational commitment haven’t been studied. The new findings show that there is an impact of job satisfaction as a mediator for meeting effectiveness on organizational commitment.

First, the paper reviews four main factors: meeting effectiveness, leadership, job satisfaction and organizational commitment. Next, the survey of Five-point Likert scale is used to measure those factors with two hundred and fortynine respondents who worked at about 34 Vietnamese organizations from a variety of sectors such as banking, health service, airlines, education and business. Finally, quantitative research is performed by using EFA, CFA analysis and SEM. The results show that leadership directly affects meeting effectiveness; and meeting effectiveness influences organizational commitment with the mediation of job satisfaction.

2. Literature Review

2.1. Meeting Effectiveness

Generally, meetings play a vital role in organizations because they strategically produce consequential outcomes. They can also be considered as the central points for organizational activities that are essential for members (Jarzabkowski & Seidl, 2008). Typical kinds of meeting are listed as board meetings, committee meetings, departmental meetings and the like (Baker, 2010). If the meetings aim at facilitating employees and organizations to achieve their goals, they obviously become organizational tools that bring benefits (Rogelberg et al., 2006).

As a result, meeting effectiveness needs to be focused for gaining organizational members’ higher performance. Actually, it was tightly involved in decision satisfaction and goal attainment. Several studies claim that to be effective, meetings need to be open, task-focused and impartial in communication (Allen et al., 2014; Nixon & Littlepage, 2014). To strengthen the same viewpoint, Bagire (2015) states that the effective meeting shouldn’t lack a clear purpose and a specific agenda, date, duration and materials and moreover emphasizes that whether a meeting is effective or not is mainly relied on the chairperson’s central role in leading the meeting (Bagire et al., 2015). Even though factors such as irrelevant topics, excessive time length and poor or inadequate preparation may affect meeting productivity (Nicholas & Jay, 2001; Pattiruhu et al., 2020), the important one is the role of team leaders or facilitators who control a meeting (Volkema & Fred, 1996). Specifically, an organization is mainly influenced by the host who has the strongest power in making the final decision (Lestari et al., 2020; Nguyen et al., 2021; Nguyen & Khoa, 2020). It is referred as leadership.

2.2. Leadership

From the literature of meeting effectiveness, it can be inferred that the leaders play most essential role (Nixon & Littlepage, 2014). In current situation with a highly diverse workforce, leadership is the decisive factor for any organization’s success. It needs to be trained and improved (Men, 2014). The common style is named “diversity-friendly” or “simpatico”. Generally, a diversity leader works as a corporate manager, that is, he or she leads subordinates in an impartial, effective and communicative way. Moreover, such a diversity leader is expected to have those characteristics which are Sensitive, Impartial, Mediators, Patient, Amiable, Teachers, Involved, Communicators, and Optimistic (Hopkins & Hopkins, 1998).

According to Simola et al. (2012), transformational leadership is most recommended. Leaders of this type have the responsibilities to transform, motivate and encourage their subordinates in order to reach their expectation ethically at work (Bass & Riggio, 2006; Simola et al., 2012). In other words, it consists of four dimensions such as idealized influence, inspirational motivation, intellectual stimulation and individualized consideration (Judge & Bono, 2000; Simola et al., 2012). In fact, followers always expect to be under the control of inspirational leaders who direct them in uncertainty and facilitate them to perform their talents (Bass & Riggio, 2006).

Another type of leadership that is most preferred is charisma. Emotionality is the main dimension in this type, the nature of which is not very rational. For instance, problem-solving is not mostly based on authority but rather on personal characteristics (Marjosola & Takala, 2000) and evidently, leaders are hard to effectively achieve goals by just only through followers’ efforts and specialty (Andersen, 2006).

From another perspective, Fry et al. (2007) highly appreciates this type of servant leadership. Four main characteristics of this type are being a servant first, serving people’s needs; serving through listening; serving through people building and serving through leadership creation (Fry et al., 2007). Sharing the same viewpoint, Men (2014) emphasizes transformational one in which leaders motivate followers by appealing to their higher-order needs and induce employees to look beyond their selfish interests for the sake of the group or the organization (Men, 2014 ).

Above all, leadership becomes the most decisive factor in an organization for its success and thus, leaders are suggested to be provided essential skills, for examples, formulating vision for an organization or setting effective objectives and plans to implement that vision in practice (Kirkpatrick & Locke, 1991). Obviously, in reality, the meeting will be more effective if it is led by the transitional or charismatic leadership. Therefore, the authors posit:

H1: Leadership will be positively related to Meeting effectiveness.

2.3. Job Satisfaction

The concept of job satisfaction has been defined in various ways. According to previous studies, it is expressed as an emotion that relates to a person’s overall evaluation with respect to their work environment and is considered to be involved in five facets: pay, promotions, peers, superiors and the work itself (Alegre et al., 2015; Yousef, 2017; Bui et al., 2021). Similarly, Steel et al. (2018) emphasizes that job satisfaction is considered as the cognitive evaluation of the well-being quality of one’s job, such as with pay, coworkers or supervisors (Steel et al., 2014; Nguyen, 2021; Johl et al., 2015). To put it in another way, some authors define it as the pleasurable emotional state originating from the organization’s appraisal for those who are supported to achieve their job values (Lu et al., 2016). Furthermore, in Judge’s study, he also confirms that job satisfaction is described as a pleasure or positive emotional state resulting from the appraisal of one’s job or job experiences (Judge & Klinger, 2008). In fact, job attitudes and well-being have the relationship with meeting demands and therefore, the more effective the meeting is, the more satisfied the subordinates feel (Burnfield et al., 2006; Cao et al., 2021). Importantly, it is an integrated factor of organizational behavior that needs to be interested, supervised and improved in order to avoid unmeasurable reactions of dissatisfaction (Masadeh et al., 2019).

As mentioned above, meeting effectiveness is positively linked to employee creativity through job satisfaction (Alonderiene & Majauskaite, 2016). Thus:

H2: Meeting effectiveness is positively related to Job satisfaction.

2.4. Organizational Commitment

Previously, there was an ambiguity in the concepts of organizational commitment and organizational identification. However, recently these terms have been discussed theoretically and tested empirically by Gautam et al. (2004). The authors strongly conclude that whereas organizational identification is self-referential or self-definitional, commitment is not and that while identification is related to perceived similarity and shared fate with the organization, commitment is formed by exchange-based factors known as the relationship between the individual and the organization (Gautam et al., 2004). Employees feel more attachment to the organizational goals and values toward organizational commitment (Buchanan, 1974; Cook & Wall, 1980). As reviewed by Mowday et al. (1978), the concept of organizational commitment is defined as from the two main perspectives: behaviors and attitude. It is the relation between an individual’s identification and involvement with the organization in which people work for. Moreover, organizational commitment can be symbolized by at least three elements “1) a strong belief in arid acceptance of the organization’s goals and values; 2) a willingness to exert considerable effort on behalf of the organization; and 3) a strong desire to maintain membership in the organization” (Mowday et al., 1978; Steers, 1977) and is a process of identification (Reichers, 1985). This leads to the following hypotheses:

H3: Job satisfaction will be positively related to Organizational commitment.

H4: Job satisfaction will mediate the relationship between Meeting effectiveness and Organizational commitment.

H5: Meeting effectiveness is positively related to Organizational commitment.

3. Methodology

The data for the research is based on the survey of two hundred and forty-nine respondents who are working at about 34 Vietnamese organizations from a variety of sectors such as banking, health service, airlines, education and business. The firm requirement is that they all are subordinates with various titles from middle managers to staff, but not in the top management board. The questionnaires contained four factors: leadership, meeting effectiveness, job satisfaction and organizational commitment and were distributed as hard copies that required handwritten responses. Five-point Likert scale is used to measure those factors with 28 items: totally disagree, disagree, neutral, agree, totally agree. A total of 249 completed handouts of questionnaires are done within six months in Ho Chi Minh City and other neighboring provinces in southern Vietnam were returned and were found to be valid. Quantitative research is conducted by nonprobability sampling method by using EFA, CFA analysis and SEM.

It is so strict because inherently Vietnamese people belong to high-context culture in which most of them tend to be indirect and nonverbal in their communication. This stereotype of culture deeply influences their mind. That’s why, in every meeting, the subordinates seem to be silent and agreeable without questioning even though they have different view point from their boss. Therefore, with the aim of understanding the subordinates and knowing how effective the meeting should be so that they feel satisfied after exchanging ideas, making changes and fulfilling the consensus, the authors decide to survey those who are all subordinates. Due to this culture, a boss is considered as the highest decision making person who has full control of meetings and directs his subordinates to meet any decided actions.

4. Results

To ensure the items in the questionnaire to be valid and reliable, the questionnaire is surveyed by two hundred and forty nine participants. The descriptive statistics result shows that it ranges with mean from 3.55 to. 4.16 and its standard deviations fluctuate from 0.727 to 0.976. Moreover, Cronbach’s Alpha ratio is 0.916 (> 0.8) with 28 items (see Table 1).

Table 1: Descriptive Statistics

Next step is EFA factor analysis. It is classified into two phases. Phase one is for independent variables, and phase two is for the dependent one.

In the first phase, three independent variables which are leadership, meeting effectiveness and job satisfaction are included in EFA factor analysis with principal components method and rotation Varimax. Specifically, KMO equals to 0.939 (≥ 0.5) and sig. 0.001 (≤ 0.05), therefore Bartlett’s Test is statistically significant (see Table 2).

Table 2: KMO and Bartlett’s Test

After Rotation method Varimax with Kaiser Normalization, 21 items of independent variables are separated into three factors. Factor 1 consists of nine items named Leadership: LDS1, LDS2, LDS3, LDS4, LDS5, LDS6, LDS7, LDS8, LDS9. However, LDS9 is eliminated because the difference of factor loadings between two factors is less than 0.3. Factor 2 involves six items called Meeting effectiveness: LDS10, MET1, MET2, MET3, MET5 and MET6. Last but not least, Job satisfaction is for Factor 3 contain four items: JOB1, JOB2, JOB3 and JOB4.

The evaluation of Cronbach’s Alpha after EFA analysis for 3 factors: Leadership, Meeting effectiveness and Job satisfaction are simultaneously at 0.922; 0.863; and 0.888. They all are accepted. (see Table 3).

Table 3: EFA Result – Rotated Component Matrix

In the second phase, the dependent variable “Organizational Commitment” is evaluated by EFA analysis. The result is that the evaluation of Cronbach’s Alpha for dependent variable “Organizational Commitment” is 0.916 which is accepted. Furthermore, KMO equals to 0.887 (≥ 0.5) and sig. 001 (≤ 0.05) that also mean the Bartlett’s Test is statistically significant and all factor loadings are more than 0.486. (see Table 4)

Table 4: KMO and Bartlett’s Test

The results of CFA factor analysis of the research model are presented in Figure 1. They are presented as follow: P = 0.000; CFI = 0.915; TLI = 0.906; GFI = 0.822; RMSEA = 0.075. According to the conditions with P < 0.05; CFI, TLI, GFI ≥ 0.8 and RMSEA ≤ 0.08, they all meet the requirements. Considering the above conditions, the model is consistent with the market data.

Figure 1: Results of CFA Concepts of Research Model (Standardized)

All parameters are statistically significant with P-value < 0.05. According to the regression weight between factors shown, while Leadership positively affects Meeting Effectiveness with weight of 0.838, Meeting Effectiveness positively affects Organizational Commitment with weight of 0.296. Specifically, when Leadership goes up by 1 standard deviation, Meeting effectiveness goes up by 0.838 standard deviation and when Meeting effectiveness goes up by 1 standard deviation, Organizational Commitment goes up by 0.296 standard deviation. Similarly, with weight of 0.576, Meeting Effectiveness has a positive effect on Job Satisfaction and Job Satisfaction has the weight of 0.864 in the relationship with Organizational Commitment. (See Table 5 below).

Table 5: Mediating with Regression Analysis

Finally, in analysis of the moderating effect of JOB on MET and OCG, there is a significant total effect of Meeting effectiveness and Organizational commitment with P-value < 0.05 and its regression weight is 0.725 with bootstrap standard errors 0.055. It ranges from 0.651 lower bound to 0.809 upper bound. MET directly affects OGC with weight of 0.270 at bootstrap standard errors 0.067. Its lower bound and upper bound are 0.167 and 0.372 respectively. However, the indirect effect of Job satisfaction on the interaction between Meeting effectiveness and Organizational commitment is slightly higher at 0.454 with errors of 0.053. The 95% confidence interval for the indirect effect (0.035, 0.543) infers that the indirect effect of “Meeting effectiveness” on “Organizational commitment” is statistically significant. This is the evidence for Job satisfaction as a mediator (see Table 5).

5. Discussion

In this study, it is found that leadership has a positive effect on meeting effectiveness. As the definition of leadership, it is referred as a process to influence organizational members to achieve their goals or results (Alonderiene & Majauskaite, 2016). In real organizational practices, meetings are led by meeting organizers or leaders who control them and make final decisions for any matters or conflicts occurring during the meeting. Apparently, whether meetings are effective or not depends on meeting organizers or leaders. As supposed by hypothesis 2 that meeting effectiveness will be positively related to job satisfaction, it definitely has a significant effect on job satisfaction. According to Burnfield et al. (2006), perceived meeting effectiveness has a strong and direct effect on subordinates’ attitude and well-being. Meetings play the vital role to coordinate and integrate employee work activities and fulfill their interdependent tasks (Burnfield et al., 2006). The findings also show that job satisfaction has a positive influence on organizational commitment. From previous studies, the concept of employee commitment to organizations is defined in several ways and as reviewed by Mowday et.al. (1978), it is mainly related to subordinates’ behaviors and attitude. That’s why job satisfaction works as a predictor of organizational commitment. With these interactive effects, job satisfaction mediates the relationship between meeting effectiveness and organizational commitment. To some extent, it is explained that whenever subordinates feel satisfied with their job through meetings, they will more commit to their organizations.

6. Conclusion

The findings show three factors having an impact on organizational commitment. It emphasizes the importance of meetings in workplaces. In order to make subordinates satisfied with their job, every conflict or problem needs to be thoroughly resolved in meetings. That’s why meeting effectiveness has a significant effect on job satisfaction. Furthermore, whether meetings are effective or not is based on leaders or meeting organizers. Thus, leadership has a positive role to play for meeting effectiveness with weight of 0.838. Previous studies have confirmed that highly committed employees may perform better than less committed ones (Steers, 1977). Obviously, if employees feel satisfied with their job, they become more committed to their organization. From the above-mentioned, it is evident that meetings effectiveness positively affects organizational commitment with weight of 0.296. Last but not the least, in the relationship between meeting effectiveness and organizational commitment, there is a mediator of job satisfaction with the indirect effect of 0.454 and its bootstrap errors at 0.053.