Impact of Organizational Culture on Effectiveness with the Mediating Role of Innovativeness and Knowledge Management : Evidence from Pakistan

This study examines the mediating effect played by knowledge management and innovation between organizational culture and organization effectiveness. We modified W. Zheng et al. (2010) model, to propose a framework depicting how different facets of organizational culture affects its performance. We also include a mediatory role of innovativeness and knowledge management in culture and effectiveness relationships. Measures assessing organizational culture were adapted from Denison (1990) that encompassed four functional dimensions: adaptability, consistency, involvement, and mission. Knowledge management encompasses its infrastructure as well as its acquisition, Conversion, application, and protection processes. To establish the validity of this framework, we conducted a survey of 179 respondents working in the corporate sectors of Pakistan by means of questionnaires. The data was analyzed using Structural Equation Modeling and Confirmatory Factor Analysis. The results suggested that there exists a strong relationship among these variables and culture has a profound impact on the overall organization, whereas the culture of knowledge sharing and innovation can improve the effectiveness of the organization. It can be concluded that Knowledge management and innovation fully mediates the relationship between organizational culture and its effectiveness