The effect of servant leadership on rewards, organizational culture and its implication for employee’s performance

Abstract

Purpose

This paper aims to examine factors that affect employee performance at Bank Tabungan Negara (BTN).

Design/methodology/approach

A quantitative research approach was used with generalized structure component analysis (GSCA) as the analysis tool. This study was specific to Jabodetabek (Jakarta, Bogor, Depok, Tangerang, Bekasi) areas, considering that 60 per cent of employees of BTN, who were also the study population, resided in the Jabodetabek areas. This study was conducted for a month in 2016. By using the representative sample, the results could be generalized.

Findings

The results of the analysis suggested that the structural model showed that the servant leadership (X1) significantly affected rewards (Y1) and organizational culture (Y2), but it had no significant effect on employee performance (Y3). Other results showed that there was a significant effect of rewards (Y1) on organizational culture (Y2) and employee performance (Y3), and that there was a significant effect of organizational culture (Y2) on employee performance (Y3).

Originality/value

Russell and Stone (2002) studied the servant leadership in a review of servant leadership attributes, and McCann et al. (2014) studied servant leadership, employee satisfaction and organizational performance in rural community hospitals. Thereby, the originality of this paper is shown on servant leadership variable for relationship between rewards, organizational culture and employee’s performance. The method used is GSCA and the location of this research is at BTN throughout Indonesia, where there are no previous research studies that have discussed the same topic on these locations.

Citation

Sihombing, S., Astuti, E.S., Al Musadieq, M., Hamied, D. and Rahardjo, K. (2018), "The effect of servant leadership on rewards, organizational culture and its implication for employee’s performance", International Journal of Law and Management, Vol. 60 No. 2, pp. 505-516. https://doi.org/10.1108/IJLMA-12-2016-0174