Influence of National Culture on Organisational Culture, Organisational Structure and Customer Satisfaction - A case of Kuwait Banking Sector

Abstract

Studies have suggested that national cultures influence those of organisations subsisting within them (Lee and Kramer 2016; Schneider, Ehrhart and Macey, 2013), and that the influence extends to organisational structures (Mao et al. 2017). Using Nardon and Steers’ (2009) dimensions of culture, this sequential mixed-methods study set out to assess the influence that national culture has on the organisational cultures and structures of both domestic and foreign banks operating in Kuwait; the interaction between their organisational culture and organisational structures; to establish whether customer satisfaction levels vary based on a bank cultures’ closeness to Kuwaiti national culture and on differences in bank cultures and structures. National culture was found to have more influence on the cultures of domestic Islamic and non-Islamic banks than those of foreign banks. Among foreign banks, national culture had more influence on banks of Middle Eastern origin than those of non Middle Eastern origin. Further, the findings indicate that domestic Islamic and domestic non-Islamic banks have a strong relationship between their cultures and structures, and they also have structures that reflect elements of Kuwaiti national culture. The study measured bank customer satisfaction using a framework derived from a combination of Parasuraman et al.’s (1988) SERVQUAL and Othman and Owen’s (2001) CARTER models. At the p=.01 level of significance, it was found that there is an association between bank culture and structure, and customer satisfaction along the dimensions: assurance, empathy, responsiveness, reliability, and tangibles. Domestic bank customers were found to have higher levels of satisfaction with their banks’ ability to assist them promptly (responsiveness), inspire trust and confidence (assurance), give individualised care (empathy) and performing the promised services (reliability) than their counterparts at foreign banks. Differences in the customer satisfaction dimension ‘reliability’ were found to be comparatively lower, suggesting the possibility of other factors coming into play. The findings illustrated that although bank structures are dictated by industry wide international standards, in places where religion is a dominant part of a national culture, its influence extends to organisational cultures and structures in a way that impacts the organisation’s ability to deliver quality service and achieve customer satisfaction. Further, the findings indicate that although the relationship between an organisation and its national cultural context is not necessarily deterministic, alignment of organisational culture and structure in the banking sector to critical elements of national culture
is associated with higher levels of customer satisfaction.

Date of Award	Sept 2020
Original language	English
Awarding Institution	University of Brighton
Supervisor	Mona Rashidirad (Supervisor) & Sushil Mohan (Supervisor)