Organizational culture as a mediator of credible leadership influence on work engagement: empirical studies in private hospitals in East Java, Indonesia

The effectiveness of healthcare services hinges on the work engagement of hospital staff. Highly engaged employees exhibit greater productivity, job satisfaction, and commitment to quality performance. This study focuses on the role of credible leadership and organizational culture in fostering work engagement within the context of two private hospitals in Madiun City, East Java, Indonesia. Previous research has highlighted the significant impact of leadership styles and organizational culture on employee engagement. Credible leadership, characterized by honesty, competence, inspiration, and vision, is posited as a key factor in shaping a positive organizational culture conducive to high levels of work engagement. This study aims to examine the direct and indirect effects of credible leadership on work engagement, with organizational culture serving as a potential mediator. The research questions address whether credible leadership significantly and positively impacts organizational culture, whether organizational culture significantly and positively impacts work engagement, and whether credible leadership significantly influences work engagement through the mediating role of organizational culture.

Existing literature extensively supports the link between leadership styles, organizational culture, and employee engagement. Studies have demonstrated the positive influence of transformational and transactional leadership on organizational culture. Furthermore, research indicates a strong positive correlation between organizational culture and work engagement. However, the specific role of credible leadership in mediating this relationship requires further exploration. The study draws upon established theories of credible leadership, organizational culture (including dimensions such as involvement, consistency, adaptability, and mission), and work engagement (vigor, dedication, and absorption) to build its theoretical framework. The review of literature emphasizes the need to understand how specific leadership practices, such as credible leadership, shape organizational culture and, ultimately, influence work engagement, particularly in the healthcare sector.

This quantitative study employed a causal research design to analyze the direct and indirect effects of credible leadership on work engagement, with organizational culture acting as a mediator. Data was collected from 255 full-time medical and non-medical personnel (89.48% response rate) at two type C private hospitals in Madiun City: Siti Aisyah Islamic Hospital and Santa Clara Hospital. Quota sampling was used to ensure representation from both medical and non-medical staff. Data collection involved questionnaires measuring credible leadership (honesty, integrity, authority, power, capability, and vision), organizational culture (integrity, professionalism, praiseworthiness, and respect for human resources), and work engagement (vigor, dedication, and absorption) using Likert scales. Structural equation modeling (SEM) using Lisrel 8.70 and path analysis with the Sobel test were employed to analyze the data and test the hypotheses. Confirmatory factor analysis (CFA) was conducted to assess the construct validity of the measurement scales.

The descriptive analysis revealed high average scores for credible leadership (3.83), organizational culture (3.97), and work engagement (4.18), indicating a generally positive work environment. The CFA results confirmed the validity of the measurement scales. The SEM and path analysis supported the hypotheses: (1) Credible leadership significantly and positively influenced organizational culture (path a, t = 5.671, p < 0.001); (2) Organizational culture significantly and positively influenced work engagement (path b, t = 2.642, p = 0.009); and (3) Organizational culture acted as a perfect mediator in the relationship between credible leadership and work engagement. The direct effect of credible leadership on work engagement was significant before controlling for organizational culture (path c, t = 1.816, p = 0.014), but became insignificant after controlling for organizational culture (path c', t = 0.843, p = 0.400). The Sobel test confirmed the significant indirect effect of credible leadership on work engagement through organizational culture (z = 2.401, p = 0.016).

The findings underscore the crucial role of credible leadership in shaping a positive organizational culture that promotes work engagement. The mediating effect of organizational culture suggests that the impact of credible leadership on work engagement is largely indirect, operating through the creation and reinforcement of a positive work environment. The high average scores across all three constructs indicate that these hospitals have generally positive work environments, though there is still room for improvement. The study's findings are consistent with previous research emphasizing the interconnectedness of leadership, culture, and engagement. The significance of this study lies in its specific focus on credible leadership within the context of Indonesian private hospitals, providing valuable insights into the dynamics of this important relationship in a specific cultural and organizational setting. The primarily female workforce also may influence the results, suggesting further study into potential gender-based leadership preferences and outcomes.

This study demonstrates a significant relationship between credible leadership, organizational culture, and work engagement in Indonesian private hospitals. Credible leadership is a key driver of positive organizational culture, which, in turn, significantly enhances work engagement. Organizational culture acts as a perfect mediator in this relationship, highlighting the importance of creating a supportive and engaging work environment. Future research could explore the generalizability of these findings to other organizational settings and investigate the influence of other leadership styles and contextual factors on work engagement.

The primary limitation of this study is its reliance on self-reported data from questionnaires, which may be subject to response biases. The sample size, limited to two hospitals in Madiun City, restricts the generalizability of the findings. Future research should expand the sample to include hospitals of different types and locations to improve the generalizability of results. Further research might explore additional variables impacting work engagement, such as work-family enrichment, and consider alternative dimensions of organizational culture.