The Impact of School’s Corporate Cultures on Teacher’s Entrepreneurial Orientation: The Mediating Role of Readiness for Change

The competition between schools in this era of globalization, especially among private schools, requisites entrepreneurial orientation development to private schools context. Many previous studies showed that entrepreneurial orientation can be influenced by corporate cultures. However, those previous studies have been mostly done on employees or managers at profit-oriented institutions. On the contrary, school teachers as employees in non-profit institution are often assumed to be conservative, prefer to have a relatively safe work, and tend to avoid changes, so they are not necessarily interested in doing entrepreneurial-oriented activities. Thus, the teacher's readiness for change also needs to be a mediator variable between corporate cultures and teacher’s entrepreneurial orientation. The purpose of this study is to examine the role of corporate cultures in schools toward teacher’s entrepreneurial orientation with teacher’s readiness for change as a mediator. The subject of this survey study are 316 teachers from 14 private schools in Indonesia that support teacher entrepreneurial orientation. The Structural Equation Model path analysis results showed that learning orientation culture could have a positive effect on teacher entrepreneurial orientation, either directly or through the mediation of readiness for change. However, market orientation culture could not give a direct positive effect on entrepreneurial orientation and requires teacher’s readiness for change as a mediator for indirect effect. The synchronization between corporate culture values with individual member’s values becomes a reason that will be discussed to explain the result of this study.
JEL Classification L26, M10, M50
Full Article

1. Introduction

Most studies on entrepreneurial orientation have been conducted on non-educational organizations (Lumpkin and Dess, 1996; Moreno, AM and Casillas, JC, 2008; Rauch et al., 2009). However, the fact that existing competition between schools in this era of globalization, especially among private schools which requisite an entrepreneurial orientation development, has opened possibilities to expand the focus of the entrepreneurial orientation to private schools context.

In the school context, not only principals or headmasters have targeted the development of the entrepreneurial orientation, but also the teachers, in order to improve the competitiveness of their school. Previous research in Pakistan on this field of study proves that teachers who are perceived to have a high entrepreneurial orientation are also perceived to have a good performance by their students since the teachers can teach in a way that is more proactive and innovative based on the needs of labour market. The entrepreneurial orientation of teacher could became a balancing of the demands of the labour market, education institutions and, students (Hayat and Riaz, 2011).

Hisrich, et al. (2007) state that more researches on psychology are still needed to explore the roles of corporate culture to the corporate entrepreneurship. It is also assumed that the effectiveness of teacher’s entrepreneurial orientation development can be influenced by corporate culture at their school. There are two corporate cultures that are often studied together with entrepreneurial orientation in improving the competitiveness of the organization, namely learning orientation and market orientation cultures (Voudouris et al., 2011; Harrison and Leicth, 2005; Todorovic and Ma, 2008; Gonzalez-Benito et al., 2009; Nasution et al., 2011; Hughes et al., 2007; Long, 2013). However, those previous studies have been mostly done on the context of non-educational organizations, thus the similar effect of those two corporate cultures on the teacher’s entrepreneurial orientation is still open to be questioned.

Teachers at schools are often assumed as conservative individuals that prefer to work in a relatively stable and safe environment for them since they tend to avoid changes (Oplatka et al., 2002; Hao and de Guzman, 2007). Conversely, entrepreneurial orientation demands changes to happen. The entrepreneurs are often assumed as agents of change (Riddle and Brinkerhoff, 2011; Partzsch and Ziegler, 2011). The learning-oriented corporate culture itself is a culture that can raise and manage changes in the organization (Recardo et al., 1995; Steenekamp et al., 2012). Similarly, market orientation culture is also a culture that rises and manages organizational changes (Yam et al., 2005; Oudan, 2012). Thus, the influence of learning orientation and market orientation cultures toward the entrepreneurial orientation for school teachers, who tend to resist change, is still questionable.

Those assumptions discussed above have encouraged this research to consider the teacher’s readiness for change as a variable of mediator between the school’s corporate culture and the entrepreneurial orientation. Individuals who possess readiness for change, in order to support and promote changes in their organization, will also improve its entrepreneurial behavior. Recent research findings have supported the assumption that entrepreneurship is synonymous with changes; therefore, the more there is readiness for changes, especially on facing the organizational changes, the stronger their entrepreneurial orientation will be (Musteen et al., 2010; Riddle and Brinkerhoff, 2011; Partzsch and Ziegler, 2011). This study is aimed at examining the roles of the corporate cultures in school to the entrepreneurial orientation of teachers with the readiness for change as a mediator.

2. Literature Review

2.1. Teacher’s Entrepreneurial Orientation and Corporate Cultures in Schools

Miller (1983) defines an entrepreneurial orientation as an involvement in both product and market innovation to make efforts at risk and as proactive actions to beat competitors. Covin and Slevin (1998) define the entrepreneurial orientation of the individual perspective as orientation of the companies in which their top leaders have entrepreneurial management style, as proven by strategic decisions philosophies in operating management they have owned and implemented. Instead, conservative companies or those, which are not entrepreneurial orientation yet, are companies in which their top leaders have decided to reject the risk, not innovative, and passive or reactive (Covin and Slevin, 1998).

There are three prime dimensions of entrepreneurial orientation have been widely used until now, namely innovativeness, risk-taking and proactiveness (Miller, 1983; Covin and Slevin, 1989). Dimension of teacher innovativeness can be actualized in the context of developing instructional strategies such as developing student-centered activities, linking the study content with real-life learning, practicing classroom management skills, creating open-ended questions, supporting for creative thinking, as well as using technology and multimedia (Horng et al., 2005). Dimension of teacher risk-taking is actualized in a risk-taking commitment to transform their students’ lives, with determination and involving emotions, although failures are possible and their talents as an educator are at stake (Brazeau, 2005). Dimension on teacher proactiveness can be actualized by having the courage to voice the idea of change, even against the bureaucratic management, to demand for change to happen in school (Westerberg et al., 2011).

This entrepreneurial orientation of teachers is assumed to be influenced by corporate culture. Two corporate cultures are often studied in relation with entrepreneurial orientation in improving the competitiveness of the organization, namely learning orientation and market orientation cultures (Voudouris et al., 2011; Harrison and Leicth, 2005; Todorovic and Ma, 2008; Gonzalez-Benito et al., 2009; Nasution et al., 2011; Hughes et al., 2007; Long, 2013).

Learning orientation culture is the values that are organization-oriented which produce or use knowledge to improve competitiveness (Huber, 1991; Calantone et al., 2002; Li et al., 2008). Calantone, et al. (2002) describe four dimensions of learning orientation. Three out of those four dimensions are equal to the dimensions proposed by Sinkula, et al. (1997): the commitment to learning, shared vision, and open-mindedness. Furthermore, Calantone, et al. (2002) add one more dimension, namely the dimension of intra-organizational knowledge sharing.

Commitment to learning is the level of appreciation and promotion of learning activities in the organization that can motivate its members to learn. Shared vision is how strong the goals are shared within the organization to the members about what and to which direction is their learning. Open-mindedness is the willingness to evaluate and criticize the organizational routine operations, and is ready to accept new ideas (Sinkula et al., 1997). Intra-organizational knowledge sharing is a common belief of the importance of sharing of learning between different units in one organization (Calantone et al., 2002).

Several studies have supported the effect of learning orientation culture to the dimensions of entrepreneurial orientation: innovativeness, risk-taking and proactiveness (Miller, 1983; Covin and Slevin, 1989). Previous study showed that this culture can positively influence toward innovativeness and risk-taking, as dimensions of entrepreneurial orientation (Farrell, 1999; Anshori, 2010; Jabeen et al., 2013). Other studies also showed that learning orientation culture can positively influence to proactiveness of members of organization as one of the dimensions of entrepreneurial orientation (Parker and Collins, 2010; Bindl and Parker, 2010). Those assumptions are respected as the foundation of formulating the first hypothesis.

H1: Learning orientation culture will have positive effect to teacher's entrepreneurial orientation.

Narver and Slater (1990) state that market orientation is the most effective and efficient corporate culture for shaping necessary behaviors to create superior values for both consumers and buyers, in order to create a sustainable superior performance for the business. Narver and Slater (1990) describe the dimensions of the market-oriented corporate culture as built on three behaviours; namely customer orientation, competitor orientation and inter-functional coordination. Oplatka and Brown (2007) describe three-dimensional behaviors of market orientation culture already described by Narver and Slater (1990) in school context. In school context, the dimension of customer orientation is the understanding of the target market as a whole school, which is able to create and deliver superior value, over time. Dimension of competitor orientation is an attempt to understand strengths and weaknesses, as well as the capabilities and potential of other schools as rivals in the competition. The dimension of inter-functional coordination is a joint coordination between all staffs and departments about market information and how to create something valuable to the market (Oplatka and Brown, 2007).

Several previous studies also show that market orientation culture influences the dimensions of entrepreneurial orientation, namely innovativeness, risk-taking and proactiveness (Miller, 1983; Covin and Slevin, 1989). The findings of researches by Anshori (2010) and Jabeen et al. (2013) prove that the market-oriented corporate culture positively influence the innovativeness, while research findings by Jaworski and Kohli (1993) and Farrell (1999) prove that market orientation culture can positively encourage people’s commitment and esprit de corps in their organization so that they are willing for risk-taking without fear. Market orientation culture can also encourage proactiveness behavior since it contains elements of initiative to find, understand and satisfy consumers’ needs (Narver et al., 2004). The second hypothesis is formulated from the above assumptions:

H2: Market orientation culture will have positive effect to teacher’ entrepreneurial orientation.

2.2. The Role of Readiness for Change as a Mediator

The readiness for change is a reflection of beliefs, attitudes and intentions of a member of an organization on the relationship between to what extent is a change needs to be done and how much of the organization capacity is needed to make these changes successful (Armenakis et al., 1993). This readiness indicate such cognitive condition that precedes the behaviors that can either inhibit or support changes through innovativeness or technology transfer (Backer, T.E., et al,. 1995).

Hanpachern (1997) outlines a deeper understanding of a readiness based on margin concept. Based on the background of margin concept, Hanpachern (1997) explains that the readiness for change is a margin or excessive energy possessed by each member of an organization that raises the belief of the members to support and promote changes within an organization. Hanpachern (1997) states that this margin or excessive energy can be caused by three factors: work, non-work, and personal characteristics or demographics.

Hanpachern (1997) develops an individual’s readiness for change of individuals within an organization as a whole. Dimensions of readiness for change covers participating, promoting and resistance in change. Members of an organization who are willing to initiate a change can be detected through the dimension of participating and promoting in change. However, members of an organization who face difficulties or obstacles to change can be detected through dimension of resistance to change as for its negative nature for changes. Therefore, a solution can be suggested to explore the situation and cause factors that inhibit the expected changes to happen (Hanpachern, 1997). This recent research is focused on dimensions of readiness for change by Hanpachern (1997), specifically to the dimension of participating in change and promoting in change. The dimension of resistance to change is excluded from this research as for its negative nature, since this research is not focused on discovering the cause factors of inhibiting changes in deeper and specific way.

Recardo, et al. (1995) suggest that the organization that promotes a learning orientation culture will become superior to its other competitors since they will be more advanced in the context of recognizing and responding to changes of market demands. The result of a qualitative study conducted by Steenekamp, et al. (2012) proves that learning orientation culture applied to companies in South Africa can boost employee motivation to change through learning process. The learning culture that they developed through trainings can improve the employees’ commitment to organizational changes (Steenekamp et al., 2012). Thus, the third hypothesis is formulated based on those assumptions.

H3: Learning orientation culture will have positive effect to teacher’s readiness for change.

Market orientation culture is also a significant culture that is needed for changes in the organization. Yam et al. (2005) show that the market orientation culture, together with total quality management, will have an impact on organizational change. Oudan (2012) says that the market orientation is necessary for changes for all organizations and institutions. The research results conducted by Farrell and Oczkowski (2002) also showed that the market orientation culture encouraged the members of organization to face changes in consumers’ demand for products and technology. Jaworski and Kohli (1993) also say that market orientation culture prepares the members of organization to more ready for facing market volatility and respond the changes of consumer’s demands. The fourth hypothesis is formulated based on these assumptions.

H4: Market orientation culture brings positive effect to the teacher’s readiness for change.

Teacher’s readiness for change will improve their entrepreneurial orientation behavior. Previous research showed that attitude to changes influences the entrepreneurial behavior, in particular innovativeness (Musteen et al., 2010). The research results conducted by Riddle and Brinkerhoff (2011) showed that business entrepreneurs are agents of change in their diaspora to various regions. Partzsch and Ziegler’s (2011) also showed that social entrepreneurs become agents of change for government bureaucracies. The results of these above researches have reinforced the assumptions that entrepreneurship is synonymous with changes. This assumes that the more ready an individual to face changes, especially in an organization, the stronger their entrepreneurial orientation is. Those assumptions are considered as the foundation of fifth hypothesis of this research.

H5: The readiness for change will have positive effect to teacher’s entrepreneurial orientation.

Figure 1, presented below, shows the model that will be explored in this empirical paper.

Figure 1. Model hypothesized

3. Method

3.1. Population and Data Collection Procedure

The population of this study is 394 teachers in 14 private schools from eight provinces in Indonesia in midyear of 2014. The study was using survey method with distributed scales questionnaires to all teachers in the population. There are four scale questionnaires which were distributed, namely entrepreneurial orientation scale, readiness for change scale, learning orientation culture scale and market orientation culture scale. 

3.2. Research Instruments

The data for entrepreneurial orientation were gained through the scale developed by the researcher, since a scale for entrepreneurial orientation for school teacher profession has not been developed so far. The scale developed by the researcher was based on dimensions of innovativeness, proactiveness and risk-taking. There were 19 items on the scale, used 5-point Likert format in Bahasa Indonesia. The scores ranged from 1 (never) to 5 (often). The subjects were instructed to give their responses based on what they did during the past 12 months. The reliability test with Cronbach Alpha showed that the dimension of innovative has α = 0.706, dimension of proactiveness has α = 0.712 and dimension of risk-taking has α = 0.711. A sample item for innovative dimension is "I am implementing a more creative new teaching method in the classroom". A sample item for proactiveness dimension is "I seek for some things in order to enhance the competitiveness of the school". A sample item for risk-taking dimension is "I am willing to implement new teaching method that is considered as more appropriate though is not necessarily approved by my superior".

The data for readiness for change were collected using the scale modified in Bahasa Indonesia from the Readiness for change Scale which was compiled by Hanpachern (1997), particularly on the dimension of participating in change and dimension promoting in change. There are 12 items on the scale, used 5-point Likert format. The scores were ranged from 1 (strongly disagree) to 5 (strongly agree). The subjects were also instructed to response to the scale based on their willingness or possibility to participate and promote the changes in their school. The reliability test with Cronbach Alpha showed that dimension of participating has α = 0.865 and dimension of promoting change has α = 0.906. A sample item for participating in change is "I am willing to be part of a new project", and sample item for promoting change is "I will encourage my colleagues to succeed the changes.”

The data of learning orientation culture were gained from the perception of teachers toward four dimensions. This instrument was adapted from Learning Orientation Scale by Calantone, et al (2002) and translated into Bahasa Indonesia. There are 16 validated items on this scale with 5-point Liker format. The scores ranged from 1 (strongly disagree) to (5) (strongly agree). The reliability test with Cronbach Alpha showed that dimension of commitment to learning has α = 0,775, dimension of shared-vision has α = 0,868, dimension of open-mindedness has α = 0,715, and dimension of intra-organizational knowledge sharing has α = 0,696. A sample item for dimension of commitment to learning is “The basic values of this organization include learning as key to improvement”. A sample item for dimension shared vision is “There is a commonality of purpose in my organization”. A sample item for dimension open-mindedness is “We are not afraid to reflect critically on the shared assumptions we have made about our customers”. A sample item for dimension intra-organizational knowledge sharing, “There is a good deal of organizational conversation that keeps alive the lessons learned from history”.

The data for market orientation culture were gained from the perception of teachers on three dimensions. This instrument was adapted from Market Orientation in The School Scale by Oplatka and Brown (2007) and translated into Bahasa Indonesia by backward and forward translators. There are 34 validated items of the instrument with 5-point Likert format. The scores ranged from 1 (strongly disagree) to (5) (strongly agree). The reliability test with Cronbach Alpha showed that dimension of customer orientation has α = 0,905, dimension of competitor orientation has α = 0,859, and dimension of inter-functional coordination has α = 0,773. A sample item for dimension of customer orientation is “My school understands the needs of children”. A sample item for dimension of competitor orientation is “My school compares favorably with other schools in the area”. A sample item for inter-functional coordination is “All departments contribute to school marketing”.

3.3. Data Analysis

Hypotheses in this study were tested using Structural Equation Model. This fit model was tested by reporting Goodness of Fit Index (GFI), Comparative Fit Index (CFI), Normed Fit Index (NFI) and Incremental Fit Index (IFI).

4. Results

4.1. Descriptive Results

There are 316 teachers who completed the survey. The participants consisted of 68% women and the rest were men. Their ages ranged between 21 to 59 years old and have been working as a teacher for at least a year. 50.63% of the research subjects were elementary school teachers, 33.86% were secondary school teachers, and the rests were high school teachers. The majority of subjects’ educational background was bachelor degree. All of the variables in Table 1 have high values. Readiness for change has the highest mean.

Table 1. Means and standard deviations for the variables of study

Variable Mean Std. Deviation
Entrepreneurial Orientation 3,43 0,43
Readiness for Change 4,05 0,64
Learning Orientation Culture 3,96 0,62
Market Orientation Culture 3,80 0,56

4.2. Measurement Model Results

Firstly, the measurement models were tested by confirmatory factor analysis (CFA). CFA test results showed that all GFI, CFI, NFI and IFI were greater than 0.90, and the results indicate a good fit. The test of factor loading also shows that all the indicators loaded were above 0.50 or significant to each of latent variables.

Table 2. Regression Coefficients (β) and T-values

Path Hypothesis Β T-value
(+) Learning orientation culture
to Entrepreneurial orientation
H1 0.19 2.36*
(+) Market orientation culture
to Entrepreneurial orientation
H2 -0.07 -0.85
(-) Learning orientation culture
to Readiness for change
H3 0.28  3.69*
(+) Market orientation culture
to Readiness for change
H4 0.23  3.10*
(+)Readiness for change
to Entrepreneurial orientation
H5 0.6 8.19*

Note: * Significant at the 0.05 level (T-value > 1.96)

The obtained results of hypotheses testing based on Structural Equation Model are shown in Table 2. After the models were modified by eliminating the insignificant paths, the results were GFI = 0.89, CFI = 0.93, NFI = 0.92, and IFI = 0.94. The results showed that the models of this research have a good fit. Regression Coefficients (β) and T-values show on Table 1. Squared Multiple Correlations (R2) of the models in this research showed that the estimation of entrepreneurial orientation is 0,47 or categorized as moderate and the estimation of readiness for change is 0,25 or relatively weak (Latan, 2013).

5. Discussion

The findings of this research showed that only the learning orientation culture has direct positive effect to the teacher’s entrepreneurial orientation, while market orientation culture has no direct effect to the teacher’s entrepreneurial orientation. The effectiveness of corporate culture influence to the organization members’ behavior can be elucidated by the synchronization between corporate culture values with individual member’s values. This synchronous cultural values and individual values will increase the effectiveness of behavioral changes, and vice versa (Anderson et al., 2001; Borman et al., 2003).

Learning orientation culture has consistent values with teacher’s personal values. Calantone, et al. (2002) define learning orientation culture as values or activities spread in the organization to produce and use knowledge for the improvement of competitiveness. This definition clarifies main values contained in learning orientation culture are the learning and knowledge value. Even though the ultimate goal of learning orientation culture is to improve the competitiveness of the organization, yet this culture highlights more on the learning and knowledge value rather than the economic value that is more pragmatic in achieving the goal.

Several previous studies have shown that many teachers prioritize the value of knowledge rather than economic value as their personal value (Koroklu and Aktamis, 2012; Lacey, 2013). The results prove that the main values contained in the learning-oriented corporate culture, which are the learning and knowledge value, are quite synchronous with teacher’s personal value. This harmony between the values makes teachers become more receptive to the values contained in the learning-oriented corporate culture and hence encourage them to behave as expected, i.e. behaviors of entrepreneurial orientation includes the dimensions of innovativeness, risk-taking and proactiveness (Farrell, 1999; Anshori, 2010; Jabeen et al., 2013; Parker and Collins, 2010; Bindl and Parker, 2010).

On the contrary, the value of market orientation culture is less aligned with teacher’s personal value. Narver and Slater (1990) explain that the superior performance as resulted from market orientation culture is the ability to earn business profit. In relation to this, Kohli and Jaworski (1990) add that the ability to make profit is a component contained in a market orientation. Based on these views, it can be concluded that the profit or economic value is the highlighted value in the market-oriented corporate culture.

Other previously researches that support the influence of market orientation culture on entrepreneurial orientation were majorly conducted at non-educational organizations that are profit-oriented (Anshori, 2010; Jabeen et al., 2013; Jaworski and Kohli, 1993; Narver et al., 2004). Thus, it can be assumed that the effect of market orientation culture on entrepreneurial orientation has been more effective in profit-oriented institutions in which their members, as assumed, prioritize more on the economic value as their personal value.

On the other hand, the teachers are assumed to prefer to work on nonprofit-oriented school institutions because they do not prioritize economic value as their personal values. Basically, school teachers are often regarded as conservative individuals; prefer to work in a relatively safe and stable environment so they tend to avoid changes (Oplatka et al., 2002; Hao and de Guzman, 2007). The survey results conducted by Koroklu and Aktamis (2012) and Lacey (2013) reveal that teachers prioritize less the economic value, indeed economic value is the last priority in their personal life.

The results of qualitative researches conducted in England and Canada reveal that teachers refuse and do not like marketing activity in a competitive environment, especially if the sales are done in an “aggressive” manner. The teachers do not like direct marketing activities because they feel that their calling is to be a teacher instead of a marketer. However, the teachers begin to admit the inter schools competition in attracting prospective students, thus they are still willing to do soft marketing activities such as open house events, by showing their high quality of teaching and services (Oplatka et al., 2002; Oplatka 2006). Those researches in England and Canada have strengthened the assumption that many teachers believe that market orientation is the orientation of the economy or business value that are not synchronous with their personal values, and hence making it less effective to change their orientation entrepreneurial behavior directly. In another hand those qualitative researches also showed that the teachers still willing to do soft marketing since they admit of the inter schools competitiveness situation. Their willingness to do soft marketing assumed the teachers are willing to change their behavior when they have ready.

The results of this study indicate the role of readiness for change as an effective mediator, both for learning orientation culture and market orientation culture towards teacher’s entrepreneurial culture. Although the market orientation culture cannot give direct effect to teacher’s entrepreneurship orientation, yet this culture can raise teacher’s awareness to change. Farrell and Oczkowski (2002) also indicate that the market orientation culture encourages the organizational members to become more courageous to face changes of consumers’ demands for products and technology. Jaworski and Kohli (1993) state that market orientation makes the organizational members getting more ready to accept market volatility in responding changes of consumers’ demands. Their readiness for change will increase their innovativeness, proactiveness and risk-taking as dimensions of entrepreneurial orientation.

Readiness for change gives strong effect to the entrepreneurial orientation of teachers, however its Squared Multiple Correlations was only 0.25, indicates that the effective contribution of both corporate cultures to the teacher’s readiness for change was only 25%. Still, many other factors have not been explored in this study. Hanpachern (1997) states that there are three factors which can become sources for readiness for change: work, non-work, and demographics factor. Corporate culture represents work factor only.

The limitation of this study is not measured yet the actual value of individual teacher as personal characteristic of readiness for change’s non-work factor. Therefore, further research is recommended to measure the individual or personal values as a moderator variable.

This study has suggested school’s management to develop both learning orientation culture and market orientation culture. School’s management is also suggested to maintain the readiness for change of teacher by supporting of work, non-work, and demographics factors.

5.1. Conclusion

Learning orientation culture gives both direct and indirect effects to the teacher’s entrepreneurial orientation. Market orientation culture gives indirect effect to the teacher’s entrepreneurial orientation only after mediated by teachers’ readiness for change. Readiness for change gives strong effect to the entrepreneurial orientation of teachers. Future research is recommended to measure teacher’s personal values which can be viewed as a moderator variable. 

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© 2017 The Authors. Published by Sprint Investify. ISSN 2359-7712. This article is licensed under a Creative Commons Attribution 4.0 International License. Creative Commons License
Corresponding Author
Jimmy Ellya Kurniawan, School of Psychology, University of Ciputra, Surabaya, UC Town, CitraLand, Surabaya 60219, Indonesia
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