Perceiving Formal and Informal Cultural Tightness In Multinational Corporations: A Study of Its Antecedents and Outcomes

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Keywords: cultural tightness, organizational control, multilevel research

Abstract: This paper investigates the antecedents and outcome of employees’ perceived cultural tightness in organizations. Contextualising our research in a multinational corporations (MNC) setting, we used a multilevel approach to examine the unique variance accounted for by the cross-cultural factor (i.e., country-level cultural tightness), intra-organizational factor (i.e., organizational age), and individual-level factor (i.e., gender) in determining the strength of formal and informal cultural tightness within the organization. In addition, given MNC’s reliance on local employees in conducting global operations, we explored the effectiveness of perceived strength of formal and informal cultural tightness in affecting employees’ commitment to the MNC. Through a field study involving a Filipino MNC whose business span across Asia, Europe, and North America, we found country-level cultural tightness is positively related to perceived informal cultural tightness and women perceive stronger informal cultural tightness than do men. In addition, organizational age is positively related to perceived formal cultural tightness. Moreover, compared to perceived informal cultural tightness, perceived formal cultural tightness emerged as a stronger predictor of organizational commitment. These findings advance our knowledge on how cultural tightness operates at the organizational level in a global setting.