How Organizational Culture Shapes Innovation Behavior among Employees: A Case Study of Pakistani Firms

Abstract

A qualitative multiple-case study approach was used in this study to examine the influence of organizational culture on the behaviour of employees in the field of innovation. Three organizations working in different sectors in Pakistan were purposively chosen for their contrasting organizational environments including an information technology organization, a manufacturing organization, and a banking and financial services organization. Semi-structured interviews were used to collect data from employees, team leaders and managers in the three organizations, with the use of organizational documents, whenever available. Interview recordings were transcribed and analysed using thematic analysis processes of initial coding, categorisation and identification of super-ordinate themes within each case followed by a cross case analysis which resulted in the identification of similarities and differences between the three organisational contexts. The five broad themes that rose to the surface were: leadership support for innovation, structural flexibility and hierarchy, communication and idea sharing, tolerance for risk and failure, and recognition and reward systems. The findings of the cross case analysis showed that the flat structure and the psychologically safe leadership style of the information technology company were most likely to foster employee innovation behavior, whereas a rigid hierarchy, risk-averse norms and formalized communication channels most strongly inhibited it in the manufacturing company, whereas the banking company was intermediate in that regard and was influenced by both compliance-driven caution and pockets of innovation leadership within its units. The results indicate that organization culture does not influence the employee's innovation behavior in isolation, but through the interaction of a number of cultural dimensions, such as leadership behavior and the tolerance for risk in the organization are more consistently influential in the contrasting organizational settings.