The Influence of Organizational Culture on Dynamic Capabilities: A Comparative Study between Public and Private Sector Employees
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Abstract
This study aims to (1) examine the influence of four organizational culture types (Clan, Adhocracy, Market, and Hierarchy) on three dimensions of dynamic capabilities (Sensing, Seizing, and Transforming), and (2) test whether public- and private-sector organizations are influenced equally by the same organizational culture, explaining the mechanisms behind any differences found. Data were collected from 432 public-and private-sector employees in Thailand through an online survey and analyzed using hierarchical moderated regression.
Results show that all four culture types strongly and measurably predict dynamic capabilities across every dimension, suggesting that investing in organizational culture yields measurable positive effects. However, public- and private-sector organizations diverge in their response to culture only on Seizing while Sensing and Transforming behave identically across both sectors, suggesting Seizing is where organizational context matters most. Notably, Market Culture predicts Seizing is significantly more intense in the public sector than in the private sector, even though Market Culture is the norm in private firms that already operate. Regarding Market Culture, it is suggested that culture which is unfamiliar to an organization can carry more transformative power than culture which it already embodies. These findings reveal that the most effective organizational culture investments differ between public and private sectors. Therefore, the public sector should prioritize developing Market Culture by linking performance systems to digital outcomes, as its impact on opportunity-seizing is twice that of the private sector. Conversely, the private sector should strengthen Adhocracy Culture while controlling Clan Culture intensity to prevent it from hindering agile decision-making.
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