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Organizational Culture and Performance: Evidence From Microfinance Institutions in Kenya

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  • Owino O. Joseph
  • Francis Kibera

Abstract

The study aimed at determining the influence of organizational culture on the performance of microfinance institutions in Kenya. A descriptive cross-sectional survey design was adopted. Secondary data were collected from annual reports by the Association of Microfinance Institutions in Kenya and the Microfinance Rating Africa. Primary data were collected using structured questionnaire targeting the chief executive officer, human resource manager, and marketing manager. Data were analyzed using factor analysis and hierarchical regression. Our analysis identifies clan and hierarchy as the dominant cultural typologies in the microfinance industry. The results obtained demonstrate that organizational culture has a significant influence on non market performance. In addition, market culture is inversely associated with debt/equity ratio. We conclude that organizational culture is a major source of sustainable competitive advantage in the microfinance industry. Furthermore, we conclude that market culture promotes financial independence and sustainability in the long term.

Suggested Citation

  • Owino O. Joseph & Francis Kibera, 2019. "Organizational Culture and Performance: Evidence From Microfinance Institutions in Kenya," SAGE Open, , vol. 9(1), pages 21582440198, March.
    • Handle: RePEc:sae:sagope:v:9:y:2019:i:1:p:2158244019835934
    DOI: 10.1177/2158244019835934
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    Cited by:

    1. Hassan Rasool, 2021. "Behavior Leverage: Bringing Beneficial Cultural Change in Organisations," PIDE-Working Papers 2021:8, Pakistan Institute of Development Economics.
    2. Yong-Sun Chang & Jian Hui Guo & Joel M. Evans, 2023. "Flexible but stable: the mediated influence of an organization’s culture on performance," Asian Business & Management, Palgrave Macmillan, vol. 22(1), pages 463-492, February.
    3. Ana Belén Tulcanaza-Prieto & Iliana E. Aguilar-Rodríguez & Carlos Artieda, 2021. "Organizational Culture and Corporate Performance in the Ecuadorian Environment," Administrative Sciences, MDPI, vol. 11(4), pages 1-17, November.
    4. Panagiota Xanthopoulou & Alexandros Sahinidis & Zorzeta Bakaki, 2022. "The Impact of Strong Cultures on Organisational Performance in Public Organisations: The Case of the Greek Public Administration," Social Sciences, MDPI, vol. 11(10), pages 1-15, October.
    5. Change Xiong & Tong Hu & Ying Xia & Jing Cheng & Xiao Chen, 2022. "Growth Culture and Public Hospital Performance: The Mediating Effect of Job Satisfaction and Person–Organization Fit," IJERPH, MDPI, vol. 19(19), pages 1-16, September.
    6. Lin Liu & Hsing-Wei Tai & Kuo-Tai Cheng & Chia-Chen Wei & Chang-Yen Lee & Yen-Hung Chen, 2022. "The Multi-Dimensional Interaction Effect of Culture, Leadership Style, and Organizational Commitment on Employee Involvement within Engineering Enterprises: Empirical Study in Taiwan," Sustainability, MDPI, vol. 14(16), pages 1-22, August.
    7. Emmanuel Michael Ochurub PhD & Andrew Jeremiah PhD & Victoria Hitumote Sem, 2022. "An Analysis of Organisational Culture as A Main Identity of An Organisation," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 6(6), pages 78-86, June.
    8. Echo Orinya Christopher & Aja David Okpabi & Damsa Justin Terris & Iornenge Christopher, 2023. "Effect of Corporate Culture on Business Performance of Deposit Money Banks in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(5), pages 1285-1298, May.
    9. Adeyinka Oluwa & Umar Abbas Ibrahim, 2021. "Investigating the influence of organisational culture on the performance of Small and Medium Enterprises (SMEs):Evidence from Nigeria," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 10(4), pages 485-495, June.
    10. Michael Ochurub PhD & Andrew Jeremiah PhD & Victoria Hitumote Sem, 2022. "An Analysis of Organisational Culture as A Main Identity of An Organisation," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 6(6), pages 32-40, June.

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