From culture and leadership to OCB and employee performance in Buleleng’s village credit institutions

Abstract

This paper examines how organizational culture and transformational leadership directly and indirectly affect employee performance through organizational citizenship behavior (OCB) within Lembaga Perkreditan Desa (LPD) or Village Credit Institutions in Buleleng Regency, Bali. It also clarifies how social exchange processes underpin these relationships in a community-based finance setting. A hybrid analytic method combining instrument pretesting, measurement-model evaluation, and variance-based structural equation modeling with mediation testing was employed. Primary survey data were collected from 88 staff-level employees across nine sub-districts over a six-month field period. The findings reveal that supportive culture significantly increases OCB and performance while transformational leadership enhances OCB but has no direct effect on performance. OCB improves performance and mediates both the culture–performance and leadership–performance links. Practically, LPD leaders should treat OCB as a performance lever, engaging staff in decision-making, recognizing discretionary effort, and aligning incentives, resources, and routines. Strengthening collectivist culture, long-term orientation, fair gender norms, and adaptive rules will help ensure that extra-role behaviors consistently translate into measurable performance outcomes

Keywords: {'name': 'Organizational Culture'}, {'name': 'Transformational Leadership'}, {'name': 'Organizational Citizenship Behavior'}, {'name': 'Employee Performance'}, {'name': 'Village Credit Institutions'}

Authors & affiliations

I Gede Aryana Mahayasa
Indonesia School of Economics

Budiyanto
Indonesia School of Economics (STIESIA)

Suhermin
Indonesia School of Economics (STIESIA)

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