The Effect of The Body Shop Indonesia’s Culture Towards Employee Performance: Mediated by Organizational Change

Abstract

The change in customer purchasing behaviors has rapidly driven businesses to undergo digital transformation and rushing to utilize e-commerce platforms. The Body Shop Indonesia, previously accustomed to offline retailing of beauty products, is one of the companies that has adopted the digital transformation since 2021. In response to the current developing competition in the beauty industry, it is critical for The Body Shop Indonesia to be able to maintain their performance to sustain in the market. Unfortunately, despite the implementation of the digital transformation, the outcomes have not been as expected. The Body Shop Indonesia is still far from being at the top of the competition. Therefore, this research is aimed to assess the significant effect of The Body Shop Indonesia’s organizational culture on employee performance during this time of organizational change. This research is conducted using a quantitative approach by distributing questionnaires to 174 The Body Shop Indonesia employees, that will be further analyzed using PLS-SEM. The result shows that The Body Shop Indonesia’s performance has a significant positive effect on their employee’s performance. This study also found that the current organizational change mediates the relationship between culture and performance. The finding of this research is intended to provide companies insight regarding organizational culture and how it can increase employee performance during the implementation of change, to obtain a competitive edge.