The Role of Technology, Organizational Culture, and Job Satisfaction in Improving Employee Performance during the Covid-19 Pandemic

Abstract

In the current Covid-19 pandemic, technology's role is important; with technology, all activities can carry on. This study explains that technology, organizational culture, and job satisfaction at rural banks in Bali can be a motivation for improving performance, especially during a pandemic. A questionnaire is distributed online using Google Form to a total of 350 employees; the data is collected from a sample of employees from rural banks in Denpasar, Bali. Respondents had to meet the following criteria: a minimum work period of one year and a minimum high school education or equivalent. With these criteria, 100 samples were obtained. The dependent variable is employee performance; the independent variables are organizational culture, technology, and job satisfaction; the intervening variable is work motivation. This study uses Structural Equation Modeling with a variance-based or component-based approach with Partial Least Square. The study results show that organizational culture, job satisfaction, and technology provide motivation and have a significant positive effect on employee performance. However, organizational culture does not have a positive or direct impact on employee performance. The study results can be used as a basis for designing business strategies to improve employee performance in a competitive environment to advance the credibility of a bank.

1. Introduction

The most dynamic history of the Indonesian banking industry’s journey is the two government policies, namely, the deregulation of the June 1983 Package and the October 1988 Package, which made it easier to establish a bank. The impact caused the number of banks to increase rapidly, and the consequence that followed was that the level of competition became increasingly fierce, coloring the Indonesian banking industry (Kadir & Amalia, 2017; Uno, 2020). The impact of intense competition has led to banking practices moving to unhealthy conditions. The government considers it necessary to limit the number of banks in Indonesia by issuing regulations setting requirements in financial performance. The impact was very significant in reducing the number of banks; several banks eventually merged. Human resources are used to synergize other resources to achieve organizational goals so that, without human resources, additional resources are idle and less useful in achieving organizational goals. Banks will be successful if they require employees do more than just their formal duties and are willing to deliver performance that exceeds expectations. Rural banks have the potential for human resources to carry out various functions of banking activities, especially during the Covid-19 outbreak, which demands to maintain distancing.

An organization also will not develop if the human resources do not have the desire to advance the organization from within them. Quality human resources become an added value for the organization and assist in optimal decision-making to contribute to its competitive advantage (Yong et al., 2020). Technological innovations have emerged to provide more accessible services for the community, so the banking business world must recognize the importance of using this new technology (Gasparin et al., 2020). In addition to technology, a company motivates employees to be enthusiastic at work and produce optimal work for what is expected by the company (Hermawan, 2020; Nardo et al., 2019; Sapta et al., 2020; Aujirpongpan & Hareebin, 2020; Lee & Xuan, 2019). Human resource relations must be instilled with noble values so that a sense of unity and trust is created, and mutual suspicion is avoided; conflicts can, thus, be reduced. This organizational culture plays a significant role in supporting the success factors of an organization (Nurkholis et al., 2020; Sapta et al., 2020). A characteristic that exists in an organization guides the organization so that it differentiates from other organizations. Organizational culture is the norm of behavior and values that are understood and accepted by all organization members and are used as the basis for the rules of conduct in the organization (Cram et al., 2017). The function of organizational culture is to foster a sense of ownership and increase employee loyalty in the company (Belias & Koustelios, 2014). For a banking organization, as an economic agency, its performance will have an impact on the economy; the application of organizational culture in the bank indirectly affects the strategic objectives (Sihombing et al., 2018).

The performance of rural banks in Denpasar, Bali, in the past five years, has experienced a decline in credit records. The largest decrease in outstanding credit occurred in 2018 compared to the decrease of 8.69% from the previous year. Meanwhile, third-party deposits in the last year showed the lowest increase of Rp2,733,253,688, or 3.01%, from the previous year. There are indications that customers’ intention to choose banks in Denpasar, Bali, is to conduct transactions, both to place funds and seek loans. Another suspicion is that infrastructure such as technology is not optimal. This study aims to examine the factors that affect the performance of employees of rural banks in Bali. The growth of banks, which has been fluctuating along with technological developments, is expected to support bank performance. Thus, later, it will achieve success and become an outstanding bank.

In the education sector of the Bandung area, employee performance is influenced by motivation variables and job satisfaction variables. Simultaneously, work culture does not directly affect performance and will affect through motivation variables (Theresia et al., 2018). Nevertheless, the labor department stated that organizational culture positively influences employee performance, offset by employee career development (Kadir & Amalia, 2017). Omollo and Oloko (2015) stated that motivation does not affect employee performance in Kenya Bank. However, other research shows that organizational culture’s motivation and job satisfaction have a positive effect on employee performance both directly and as a mediator. According to Arshad and Abbasi (2014) technology plays an essential role in employee performance in research conducted at Allied banks in Pakistan. The research on the banking sector in Bahawalpur also shows that technology has a powerful influence on employee performance directly or through mediation.

Everyone needs to use a bank because the economic turnaround originates from bank transactions. Likewise with banks on Bali’s island, but according to a field survey conducted by the author, the bank’s performance has fallen, especially during the Covid-19 period. Then, what about the rural banks in Denpasar, Bali? This study seeks to determine rural banks’ performance during the pandemic by evaluating the influencing factors such as organizational culture, job satisfaction even with the use of technology, and whether this is a motivation for improving employee performance at rural banks.

This research enters unchartered territory. The construct model from previous studies has not been using the five variables described below; this study contributes to the literature on employee performance in the banking industry by adding technology in the context of the pandemic situation. This is expected to inspire further research. In addition, it is also useful for the banking business world as input on how to improve employee performance in the technological era. Creating an organizational culture where employees are satisfied with their work with full motivation is important so that human resources will continue to retain its customers and the banking business continues its life cycle.

2. Literature Review

2.1. Employee Performance

Performance needs an assessment to provide the right opportunity for employees to develop their career plans to identify their strengths and weaknesses so that companies can determine salary, provide promotions, and can assess employee behavior (Kehoe & Wright, 2013). Wayne and Ferris (1990) stated work results relate to the level of quantity and quality, how it has been produced, and the extent to which supervision is carried out. It involves (1) Job knowledge: the level of knowledge related to work tasks that will directly affect the quantity and quality of work results; (2) Initiative: the initiative’s level during work tasks, especially in terms of handling problems that arise; (3) Mental proficiency: the level of ability and speed in receiving work instructions and adapting to existing work methods and work situations; (4) Attitude: the level of morale and positive attitude in carrying out tasks; (5) Job performance: the discipline of time and attendance such as punctuality and attendance levels. Employees experience a feeling of comfort in the work environment’s culture. When employees feel they can solve a work problem, job competence and job autonomy will impact work (Hewagama et al., 2019).

2.2. Motivation

According to Robbins (2016), motivation is defined as a process that explains the strength (intensity), direction, and persistence of a person to achieve goals. Motivation is a process where needs encourage a person to carry out a series of activities that lead to achieving a goal (Schunk & DiBenedetto, 2020). Changgriawan (2017) states that measuring and identifying a person’s work motivation can use self-determination theory. Self-determination theory provides a multidimensional view of motivation and determines different types of motivation. Bauman et al. (2020) defines motivation as a series of attitudes and values that influence individuals to achieve specific tasks in accordance with individual goals. These attitudes and values are invisible, which provide the strength to encourage individuals to behave in achieving their goals (Haryono et al., 2020).

Su and Swanson (2019) say that direction and motivation are essential, it is a skill in aligning employee or organization interest, so that behavior results in achievement of employee is simultaneously with attainment or organizational objectives. Motivation is a skill in directing employees and organizations to work successfully, so that the desires of employees and organizational goals can be achieved at once. For Herzberg (in Nwankwo et al., 2018), motivations are factors that are extrinsic in nature originating from outside oneself that also determine a person’s behavior in the person’s life. Work motivation is the willingness to carry out high-level efforts to achieve organizational goals conditioned by the ability of efforts to meet certain individual needs. Silalahi and Sembiring (2020) also states that there is a positive and significant influence of motivation on employee performance. This means that any increase in motivation that employees have in carrying out their work will produce an increase in their performance.

In addition to their research on the influence of leadership, motivation, work discipline and work environment on employee performance, they also state that the higher or lower the level of motivation, the higher or lower the impact on the level of employee performance, which means that there is a positive and significant influence of motivation on performance (Anggraini et al., 2019). Motivation has a positive and significant effect on employee performance. Although according to Simbolon et al. (2020), motivation does not have a significant effect on employee performance. These results do not support the previous research, which states that motivation has a significant effect on employee performance. But the results of other studies linking motivation to performance are supported by Pratama et al. (2019) and Mahardika et al. (2019). For them motivation has a positive and significant effect on employee performance. Motivation plays an important role in improving employee performance. This needs to be realized by management in order to maintain and continue to increase motivation at work.

2.3. Organizational Culture

Organizational culture is defined as a cognitive framework that contains attitudes, values, norms, and mutual respect shared by organizational members (Kadir & Amalia, 2017). Organizational culture or corporate culture is often defined as values, symbols that are understood, which is displayed by an organization so that members of the organization feel they belong to one family and create a condition that members of the organization feel different from other organizations (Bisbey et al., 2019). Patterns of beliefs, values, and methods are learned from experiences that have been developed throughout the history of the organization, which are manifested in the material management and behavior of organizational members (Huragu & Chuma, 2019). Culture is the assumption that the group learns through problem-solving of external adaptation and internal integration (Nurkholis et al., 2020). A group of organized people who have the same goals, beliefs, and values that can be measured through their influence on the motivation of organizational culture has a positive impact on building motivation (Ayalew et al., 2019; Kadir & Amalia, 2017; Rubel et al., 2020; Staempfli & Lamarche, 2020; Wang et al., 2020).

2.4. Technology

Progress of technology is the process of combining and rearranging knowledge so that it can generate new ideas; the rapid development of technology will impact the performance of companies (Martínez-Caro et al., 2020). There are technological advances that come from internal progress (Pavitt, 1991), where internal progress comes from employees’ ability. There is a close relationship between technological progress and employee performance (Alam & Murad, 2020; Song et al., 2019; Dnishev & Alzhanova, 2016). Technology can lead to increased productivity or improved performance when combined with other resources by human resources or when done effectively, and using technology productively and ethically (Singh & Verma, 2019). Advances in technology, especially information technology, positively influence employee motivation (Abbas et al., 2014). Technology has a significant influence on motivation in a study of classrooms in London (Stockwell, 2013). The use of technology makes the delivery of information faster, enhancing management (Khanam & Mahfuz, 2017; Sriyakul et al., 2019; Theresia et al., 2018).

2.5. Job Satisfaction

Job satisfaction is a subjective nature, the result of a conclusion based on a comparison of what is received by employees and their work compared to what is expected, wanted, and examined as things that are appropriate or entitled to them (Hu et al., 2019). Common factors covered are supervisors, current wages, promotion opportunities, and relationships with colleagues (Rustiarini et al., 2019). These factors are scored on a book scale and then added together to create an overall job satisfaction score (Granziera & Perera, 2019). Job satisfaction is also a process of achieving employee motivation levels, being more productive at work, and a form of employee employment driven by the fulfillment of their needs. The needs of workers who can be adequately fulfilled are stimuli that can motivate them to work comfortably and optimally.

There is a positive relationship between job satisfaction and motivation (Ayalew et al., 2019; Kadir & Amalia, 2017). As revealed by Staempfli and Lamarche (2020), employees will feel satisfied at work if aspects of the job and aspects of themselves can be encouraged and vice versa. If these aspects cannot be encouraged, employees will feel dissatisfied.  According to Sriyakul et al. (2019), organizational culture has a relationship with employee performance, meaning that organizational culture can be used as a basis for predicting employee performance. Organizational culture is very influential in performance because it can trigger employees to think and behave according to organizational values. The descriptive analysis of respondents’ answers also shows that hardware and software affect performance (Abbas et al., 2014). According to Guan (2018), employees cannot be more effective due to technological constraints or coordination requirements. The individual performance also depends on the efforts and performance of colleagues on the team or production line. Heryanto (2019) states that work motivation has a positive and significant effect on employee performance. This is in line with other empirical findings that there is a relationship between work motivation and performance (Rubel et al., 2020). Staempfli and Lamarche (2020) also conducted research, which states that motivation affects employee performance. The results of the study state that the level of work motivation affects performance. The following hypotheses are proposed.

H1: Organizational culture affects motivation

H2: Technology affects motivation

H3: Job satisfaction affects motivation 

H4: Organizational culture affects employee performance 

H5: Job satisfaction affects employee performance

H6: Technology affects employee performance 

H7: Motivation affects employee performance

Figure 1: Conceptual Framework

3. Methodology

This study’s population was 350 employees of rural banks in Denpasar, Bali, with the following criteria: a minimum work period of one year and minimum high school education or equivalent. From these criteria, 100 samples were obtained. This study uses Structural Equation Modeling with a variance-based or component-based approach with Partial Least Square. The dependent variable is employee performance (Y2), the independent variables are organizational culture (X1), technology (X3), and job satisfaction (X3); the intervening variable is work motivation (Y1).

The sample is determined using the formula designed by Hair, Ringle, and Sarstedt (2013), Hair Jr, Sarstedt, Matthews, and Ringle (2016). Total samples = number of indicators x 5 to 10. Because in this study, there are 22 indicators, the minimum number of samples used is sample = number of indicators X 5 = 22 X 5 = 110 respondents. Furthermore, Hair et al. (2013) found that SEM’s appropriate sample size was between 100-200 samples. The research sample was all employees of Rural banks in Denpasar, Bali, totaling 100 people.

The questionnaire is distributed through online media using Google Form; the data is collected from rural banks in Denpasar, Bali. The total number of completed questionnaires is 350 employees; only 100 samples are taken because they constitute a representative sample as per Hair’s formula.

Employee performance variables (Z) use five indicators, namely, quality of work, quantity of work results, knowledge, cooperation, and effectiveness in adopting research (Hewagama et al., 2019; dan Rubel et al., 2020). Technological variables use four indicators, namely, feelings of technology use, the suitability of tasks, long-term consequences, and facilitating conditions (Alam & Murad, 2020; Arshad & Abbasi, 2014). Job satisfaction includes four indicators, namely, attractive work, career, comfort, and relationships with coworkers (Giao, 2019). Motivation is from Victor Vroom’s research in Huragu and Chuma (2019) and Rubel et al. (2020). Employee performance adopts Bernardin and Russell’s indicators, namely, quality of work, quantity of work, knowledge, cooperation, and effectiveness (Hewagama et al., 2019).

Table 1: Demographic of Respondents

4. Results

4.1. Respondents Characteristics

Research data is described by presenting respondents’ characteristics based on demographic variables, namely, gender, age, type of occupation, education, and monthly income. The demographic data of respondents are presented in Table 1.

Based on gender, it shows that women dominate employees who work at rural banks (68%). This indicates a high level of women working in banks. Respondents based on age showed 43 people are between 18 and 28 years (43%), 34 people are between 29 and 39 years (34%), 17 people are between 40 and 49 years (17%) and six people are between 50 and 57 years (6%). It indicates the high proportion of bank employees in the productive age bracket working at the bank. Some 42 people (42%) have an undergraduate education. In terms of income, as many as 35 people or 35% have a salary in the UMR amount between two and four million rupiahs

4.2. Measurement Test Model

Table 2: Test validity and reliability

4.3. Structural Model Test (Inner Model Evaluation)

The inner model evaluation aims to determine the goodness of fit with the following approach method: 

1. R-Square (R²).

Shows the strength and weakness of the influence caused by variations in exogenous variables on endogenous variables. R² is greater than 0.50 is categorized as a strong model. R² is the coefficient of determination in the endogenous construct. According to Chin (1998), R² 0.820 (strong), 0.731 (mediating) (strong). R² of each endogenous variable is presented in Table 3.

Based on Table 3, organizational culture variables have an R-square value of 0.731, meaning that 71.3% of the motivation variable can be explained by the organizational culture, technology, and job satisfaction variables. In contrast, the rest is explained by other variables outside the research. Apart from using the R-square, the goodness of fit of the model is also measured using the Q-Square predictive relevance for the structural model, measuring how well the model and its parameter estimation generate the observed value. Value> Q-square 0 indicates the model has predictive relevance; conversely, if the value of Q-Square ≤ 0 indicates that the model lacks predictive relevance. The calculation of Q-Square is done with the formula:

\(Q2 = 1-\{(1 -Rx12)(1-R22)\}\) 

To measure how well the observed value is generated by the model and also its parameter estimates, it is necessary to calculate Q-square (Q²) as follows:

\(Q^2= 1-(1-R_1^2)(1-R_22) \\ = 1-(1-0.731)(1-0.820) \\ =1-(1-0.534)(1-0.672) \\ =1-(0.466)(0.27) \\ = 1-0.152 \\ =0.8476\) 

The Q-square calculation yields a value of 0.8476 or 8.476%, which means that the model has an excellent observation value. This means that the model can explain 8.476%, the relationship between variables. Based on the two results of the internal model assessment above, R2 is at a moderate and robust level, and Q2 is excellent.

4.4. Estimate for Path Coefficients

Table 4 shows that, of the seven causal relationships between exogenous variables and endogenous variables, there is one relationship that is not significant (hypothesis is rejected) at α 0.05 with a statistical value <1.96. Meanwhile, there are six causal relationships between exogenous variables and endogenous variables, which are significant (hypotheses are accepted) at α 0.05 with a statistical value> 1.96.

Table 3: R Square

Table 4: Path Coefficients Path Coefficients

Figure 2: Empirical Research Model

5. Discussion

Based on the results of the analysis of the influence of organizational culture on motivation, the p-value is 0.031 (p-value <0.05), with a t-statistic of 2.167 (t-statistic> 1.96) and a positive path coefficient value of 0.155. This indicates that H1 is accepted, which means that organizational culture positively affects employee motivation. The results of data analysis indicate that organizational culture has a positive and significant effect on employee motivation. This means that organizational culture, as measured by four indicators, namely, mission, consistency, adaptation, and involvement, positively and significantly affects motivation at rural banks, Denpasar, Bali. This research is in line with Ayalew et al. (2019), who said that work culture directly motivates an employee to work. Organizational culture positively impacts building motivation (Kadir & Amalia, 2017; Rubel et al., 2020; Staempfli & Lamarche, 2020; Wang et al., 2020).

Based on the results of the analysis of the effect of technology on motivation, the p-value is 0.006 (p-value <0.05), with a t-statistic of 2.757 (t-statistic> 1.96) and a positive path coefficient value of 0.220. This indicates that H2 is accepted, which means that technology has a positive effect on employee motivation. Data analysis results show that technology is measured through four indicators, namely, social factors, task suitability, long-term consequences, and conditions that facilitate a positive and significant effect on motivation. This implies that the more the technology is used, the more work motivation of an employee will increase. This study is in line with previous research (Arshad & Abbasi, 2014; Stockwell, 2013), which states that technology is very influential in employee performance, both directly and by mediating motivation. Based on this research, it can be posited that technology is needed to motivate an employee to improve individual’s performance.

Based on the results of the analysis of the effect of job satisfaction on motivation, the p-value is 0.000 (p-value <0.05), with a t-statistic of 8.112 (t- statistic> 1.96), and the positive path coefficient value is 0.505. This indicates that H3 is accepted, which means that job satisfaction positively and significantly affects employee motivation. This means that the satisfaction felt by an employee as measured by five indicators, namely, empathy, exciting work, career, comfort, and relationships with colleagues, has a positive effect on motivation at the rural banks in Denpasar, Bali. This shows that employee satisfaction felt by employees motivates them. This research is in line with the research results that job satisfaction significantly affects motivation (Ayalew et al., 2019; Kadir & Amalia, 2017; Staempfli & Lamarche, 2020). So, it can be concluded that organizational culture does not influence employee work motivation. It is necessary to have other stimuli to increase work motivation for the sake of improving employee performance.

Based on the results of the analysis of the influence of organizational culture on employee performance, the p-value is 0.593 (p-value >0.05), with a t-statistic of 0.535 (t-statistic <1.96) and a positive path coefficient value of 0.030. This indicates that H4 is rejected, which means that organizational culture has no positive effect on employee performance. Organizational culture is measured through four indicators, namely, mission, consistency, adaptation, and involvement, which have no positive and insignificant effect on employee performance at rural banks. This shows that the hypothesis is rejected; the organizational culture at the rural banks cannot increase the performance of the employees This study is not in line with previous research (Ayalew et al., 2019; Sriyakul et al., 2019; Theresia et al., 2018), stating that organizational culture has a direct effect on employee work motivation.

Based on the results of technical analysis on employee performance, the p-value is 0.030 (p-value <0.05), with a t-statistic of 2.170 (t-statistic> 1.96) and a positive path coefficient value of 0.573. This indicates that H5 is accepted, which means that technology has a positive effect on employee performance. Technology is measured through four indicators, namely, feelings, task suitability, long- term consequences, and conditions, which have a positive and significant effect on motivation. This implies that the more the technology used, the more employee’s work performance increases (Arshad & Abbasi, 2014; Cavdar & Aydin, 2015; Nuskiya, 2018; Aujirpongpan & Hareebin, 2020; Lee & Xuan, 2019; Dnishev & Alzhanova, 2016). Advances in technology, especially information technology, have a positive influence on employee motivation. Based on this research, it can be explained that technology is needed to improve each individual’s performance.

Based on the results of the analysis of the effect of job satisfaction on employee performance, the p-value is 0.000 (p-value <0.05), with a t-statistic of 5.732 (t-statistic> 1.96) and a positive path coefficient value of 0.282. This indicates that H6 is accepted, which means that job satisfaction positively and significantly affects employee performance. Data analysis results show that job satisfaction, as measured by five indicators, namely, appreciation, exciting work, career, comfort, and relationships with colleagues, positively affects employee performance. This implies that the more job satisfaction an employee experience, the more the employee’s performance increases. This finding is in line with research by Ayalew et al. (2019), which states that job satisfaction positively affects employee performance. Based on this research, it can be explained that job satisfaction is needed by an employee to improve the performance of each individual even though, according to its nature, job satisfaction itself varies from one person to another.

Based on the results of the analysis of the influence of motivation on employee performance, the p-value is 0.003 (p-value <0.05), with a t-statistic of 2.981 (t-statistic> 1.96) and a positive path coefficient value of 2.809. This indicates that H7 is accepted, which means that motivation positively and significantly affects employee performance. Data analysis results show that motivation, as measured by four indicators, namely, work atmosphere, reward, treatment, and work discipline, has a positive effect on employee performance. This implies that the better the motivation, the better the employee’s performance. This result is in line with previous research (Heryanto, 2019; Rubel et al., 2020; Staempfli & Lamarche, 2020) stating that motivation affects employees; high and low work motivation affects performance. Based on this research, it can be concluded that someone needs work motivation. Employees achieve high-performance output and achieve one of the predicates determined by the agency for the bank, namely, the healthy predicate.

6. Conclusions

Organizational culture, technology, and job satisfaction have a positive impact on the employee’s motivation. It means that the more satisfied an employee is, the more motivated he will be at work. Of course, it will increase the performance of the employee and produce maximum output for the company. Motivation has a positive effect on employee performance. This shows that the higher the increased motivation is given by management to employees, the higher the employee’s performance and achievement of one of the agency’s predicates, namely, the healthy predicate. However, work culture has minimal effect on employee performance. This shows that the higher work culture will not have an impact on employee performance. In this study, organizational culture does not influence employee performance. The bank management must pay attention to those various factors to strengthen work performance such as recognition of employee performance, a conducive relationship between employees and colleagues and superiors, and the policies implemented by bank management. Further research should develop indicators in organizational culture.

Employees who work must be kept satisfied by providing motivation in terms of self-development, knowledge sharing as well as incentives because satisfaction at regional banks in Bali has a big influence on employee performance. Organizational culture must be reviewed because the culture of each region is different, and it must be taken into account to improve employee performance.