Religiosity Effects On Employees in Smes: An Islamic Country Perspective

Journal of Enterprising Culture
Vol. 26, No. 1 (March 2018) 85–111

© World Scientific Publishing Company
DOI: 10.1142/S0218495818500048
by UNIVERSITY OF NEW ENGLAND on 09/29/18. Re-use and distribution is strictly not permitted, except for Open Access articles.
Religiosity Effects on Employees in SMEs:

An Islamic Country Perspective
Arsalan Mujahid Ghouri*

University Pendidikan Sultan Idris, Perak, Malaysia
J. Enterprising Culture 2018.26:85-111. Downloaded from www.worldscientific.com
Montpellier Business School, Montpellier, France

arsalan.ghouri@ymail.com, a.ghouri@montpellier-bs.com
Naveed R. Khan
Bahria University, Karachi, Pakistan
University Pendidikan Sultan Idris, Perak, Malaysia
naveed.r.khan@gmail.com
Omar B. Abdul Kareem

University Pendidikan Sultan Idris
Perak, Malaysia
omar@fpe.upsi.edu.my
Muhammad Shahbaz
Montpellier Business School
Montpellier, France
muhdshahbaz77@gmail.com
This study aims to investigate the adaptation of internalization factors and

employees’ competitive behavior in small and medium enterprises (SMEs).
The empirical findings suggest that the integration of religious orientation brings
better results along with the other determinants (subjective norm, attitude,
behavior control and intention) of the Theory of Planned Behavior (TPB). Fur-
ther, this study indicates the significant direct relationship between religious
orientation, attitude, perceived control and intention with employee behavior,
except for subjective norms and intention, which shows an insignificant rela-
tionship. This empirical findings suggest that owners and managers of SMEs
should place some efforts in providing support to increase religious orientation in
SMEs, as this would likely to enhance all other factors. This study reports unique
empirical findings to support the generalizability of the theory while also adding a
* Corresponding author.
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new facet to the TPB by using SMEs as a social lab and data from a developing
country.
Keywords: Religious orientation; employee workplace behavior; theory of

planned behavior.
INTRODUCTION
The cultures of countries or organizations shape individual actions.

In economics, religious beliefs and practices have been traditionally con-
sidered a component of an individual’s cultural heritage and a determinant

of their tastes and preferences, but they have not been the subject of ex-
tensive analysis until recent years (Perez-Villadoniga et al., 2014). On the
other hand, professional work is a central part of most adults’ lives has led
to interest in the relationship between individuals and their work (Sharabi,
2017). All major religions promote particular values that believers express
at work (Parboteeah et al., 2009). Even though the role of religious beliefs
impacts the behavior of individuals, they have not been amply investigated
in research studies about organizations or workplace.
It is widely accepted that human behavior is key for achieving com-
petitive goals across the industries. It is highly important for managers to
adopt and link internalized human factors with employee competiveness.
Businesses should invest resources to understanding employee behavior,
which is directly linked to performance. The Theory of Planned Behavior
(TPB) elaborates a way of modifying human behavior. The TPB defines
intentional actions as deliberative and designed. Earlier, Ajzen and Fish-
bein (1977, 1980) have proposed the Theory of Reason Actions. Later
theories discovered that human actions are neither 100% complimentary
nor controlled, which are revealed in consequences as perceived behavioral
control. After this inclusion, the new perspective theory was recognized as
the Theory of Planned Behavior.
The TPB helps in predicting the intentions of an individual, which in
turn support in making organizational decisions. The TBP has been tested
in various social labs, however, in context of employees associated with
small and medium enterprises does not sufficiently comes under limelight.
Hence, this study aimed and focused SME sector with the application of
TBP. SMEs occupy a substantial share of total world output and employ-
ment and play a pivotal role in economic and technological development,
and performance (Baruch and Gregoriou, 2017; Koh et al., 2007; van Esch
et al., 2016). Further, Noe et al. (2003) suggested that employees are the
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Religiosity Effects on Employees in SMEs
backbone of any organization, and efficiency and effectiveness of resources

are dependent on employee performance. Meanwhile, Armstrong (2006)
illustrated that employees also participate in setting objectives, roles, and
competence requirements. Similarly, Cardy and Selvarajan (2006) posited
that organizational-level competencies are embedded in employee-level

competencies, and the latter is important for organizations to achieve a
competitive advantage. Woodruffe (1992) defined employee competencies
as the set of behaviors that the incumbent needs to bring to a position in
order to competently perform tasks and functions. However, Kochanski
(1996) described the employee competency concept as the success factors
in an employee’s organization and profession. Wright and Geroy (2001)

argued that employee competencies empower them to efficiently implement
job-related work and competitively achieve firm objectives. A firm whose
employees have unique abilities, knowledge, and foresight to make an
accurate assessment of a strategic resource’s rent-earning potential may
achieve superior economic benefits relative to those firms that lack such
unique abilities, knowledge, or foresight (Alchian and Demsetz, 1972;
Barney, 1986; Lado and Wilson, 1994). Howanitz et al. (2000) stressed
that employees of an organization are the major determinant when pro-
viding quality products and services.
In context of a developing country like Pakistan, locally owned firms are
now entering global markets. Hence, they are facing foreign competition in
those global markets. Pakistan’s SME sector can potentially play a signif-
icant role in the economic development of the country. According to Small
and Medium Enterprises Development Authority — SMEDA and State
Bank of Pakistan (SBP), “small medium enterprise is a business entity,
ideally not a public limited company. In case of manufacturing & service
establishments, employs more than 50 employees (including contract
employees) and less than 250 employees. For all SMEs paid up capital is up
to PKR. 25 million and annual sales turnover is up to PKR. 250 million”.
According to 2008 Economic Census of Pakistan, it was reported that
SMEs represented 90% of the overall business, contributed 78% of value
added and 30% of Gross Domestic Product (GDP), accounted for 25% of
export earnings and generated 80% of the jobs in the country. These
accelerating facts place pressure on SME owners/managers to harness the
maximum competitiveness from their employees.
The literature shows that the adaptation of TBP with a religious orien-
tation in small and medium enterprises (SMEs) can influence employees’
behavioral intentions at work and can be modified, which should improve
employee competitiveness. Existing literature suggested that religion
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engenders the shape of behavior, which is strongly followed by people.

This research contributes through extension of TPB in SMEs, which should
result in the improvement of employees’ competitive behavior. This study
provides practical value for SMEs owners and managers to maximize their
employees’ competitive behavior through an effective adaptation of TBP

with a religious orientation that supports their organization.
MacLeod and Clarke (2009) suggested that employee behavioral
(engagement) approaches could positively impact UK competitiveness and
performance. Potnuru et al. (2016) conducted a study on two medium-sized
cement manufacturing companies and concluded that employee compe-
tencies were instrumental in improving organizational effectiveness. Ulrich

et al. (1995) gathered and analyzed the data from 12,689 associates of
human resource (HR) professionals from 1500 businesses in 109 firms.
Their results indicated that when HR professionals demonstrate compe-
tence, they perceived by their associates as more effective.
LITERATURE REVIEW
Theoretical Background
The TPB is one theory discussed and tested in research areas across the
world. This theory was first proposed by Icek Ajzen and succeeded the
Theory of Reasoned Action by adding the perception of behavioral control
as another predictor of behavior and intentions (Madden et al., 1992).
According to Randall and Gibson (1991), TPB is a helpful tool in studying
and learning how the behavior of a person can be changed. The TPB model
indicates that intention is directly determined by the three factors of sub-
jective norm, attitude, and behavior control. This theory helps learn how
and what influences a behavior to be created or changed. The TPB can
predict different kinds of behaviors with high accuracy through subjective
norms, behavioral control, and attitudes. Subjective norms and behavioral
control show the set of significant behavioral, normative and control beliefs
on behavior, but an accurate assessment of these relationships are still
unclear. All of them influence an individual to exhibit a deliberative be-
havior (Randall and Gibson, 1991). In accordance with the theory, it states
that there are individual behaviors that are driven by the behavioral inten-
tions, intentions towards the behavior, and subjective norms surrounding
the behavior. It discusses the factors that lead up to a behavior being
assessed as right or wrong or whether they support the behavior. The
available literature shows the relationship of TPB to individual behavior
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(e.g. Ajzen, 1985, 1991, 2002, 2005; Ajzen and Fishbein, 1977, 1980;
Ajzen and Sheikh, 2013; Cheung and To, 2017; Fishbein and Ajzen, 1975,
2010; Haydon et al., 2017; Hoffmann, 2013; Jegannathan et al., 2016;
Jeynes, 2002; Pavlou and Fygenson, 2006; Steinmetz et al., 2016; Ter Voert,
1993), and most importantly, employee/executive behavior (e.g. Ajzen,

2002; Cordano and Frieze, 2000; French et al., 2005; Greaves et al., 2013;
Kashif et al., 2017; Röttger et al., 2017; Stevens et al., 2005; Zampetakis et
al., 2017). In previous studies it is evident that TPB explains 41%–50% and
28%–34% of the variance in intention and behavior respectively (e.g.
Albarracin et al., 2001; Morris et al., 2005). Hence, the remaining un-
known variance indicates that there is a need for the inclusion of additional
variable(s). However, the religiosity factor was not tested with facets of
TPB in the literature prior to this study. Hence, this paper examines how
religious orientation would enhance the analysis of the impact of the three
facets of TPB to predict the behavior of employees in SMEs.
Religiosity Link to Behavior

Religion is a component of culture. Religion is defined as the degree
to which an individual associate themselves to certain beliefs and rituals
(Esso and Dibb, 2004). It refers to the set of beliefs that people hold.
Francis and Crea (2016) explained the religious orientation theory as being
concerned with identifying the motivation underpinning the engagement of
those who are religiously involved. Parboteeah et al. (2009) suggested that
consciously or unconsciously, religious beliefs and practices affect indi-
vidual attitudes to important facets of life and specifically promote par-
ticular values that believers express at work. According to Meadow and
Kahoe (1984), there are three major components in understanding religious
behavior: the creed or cognitive (which refers to thinking), the culture or
affect (which refers to feeling) and the code or the conation (which refers to
the striving). It is the specific behavior that people portray when they are
devoted to specific practices and values. In other words, religion is the most
significant aspect of a person that impacts his lifestyle and behaviors. Al-
most every single person is affiliated to a religion and makes decisions
accordingly with their respective religious book(s) and preachings. An in-
dividual intends to act as permissible in his/her religion and ignores the
ones who are considered to be unethical in terms of society and culture.
Hence, it is safe to say that religion can impact human life. Jeynes (2002)
performed meta-analysis on attending religious school and religiosity, and
concluded that religious schooling and religious commitment each have a
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positive effect on academic achievement and school-related behavior.

Yeganeh (2015) evidenced that religiosity has a quadratic relationship with
intrinsic work values. Ter Voert (1993) conducted a study on 562 religious
persons in the Netherlands and showed that more religious people appear to
have a more positive attitude towards work as a duty. Perez-Villadoniga

et al. (2014) also proved the positive association between religious in-
volvement and an individual’s self-declared willingness to work.
Yousef (2000) found that Islamic work ethics directly and positively
influences the attitudes toward organizational commitment in United Arab
Emirates. Relationship of religiosity influence on working behavior also
illustrated by different studies as well (e.g. Audretsch et al., 2013; Black-

wood, 1979; Bourma and Dixon, 1987; Lehrer, 2004; Ray, 1982; Tracey,
2012; Weaver and Stansbury, 2014; Wilson and Janoski, 1995).
Allport and Ross (1967) proposed two distinguished, contrasting sources
of religious motivation, which they theorized as intrinsic orientation and
extrinsic orientation. In the present study, we adopted intrinsic religious
orientation as a behavioral antecedent. Intrinsic religious orientation con-
ceptualizes how important an individual perceives religion to be in their
life (Kirkpatrick and Hood, 1990), how it molds their practices, and the
spirituality focused on one’s religious practice (Laurencelle et al., 2002).
Allport and Ross (1967) proposed that intrinsically religious individuals
place a greater emphasis on religion to create a spiritual connection with God
through good deeds and righteousness. However, extrinsic religious orien-
tation is associated with an emphasis on the secondary benefits of religion,
such as social friendships and relationships (e.g., Litman et al., 2017; Neill
and Kahn, 1999). Hence, conceptually we find intrinsic religious orientation
is suitable for our study goal, as religion teaches individuals to avoid unethical
behavior or wrongdoing in terms of society and culture, which can apply to an
organization as well. Previous empirical studies found intrinsic religious
orientation to be correlated with positive psychological items (such as socially
inclusive values), while extrinsic religious orientation was found to be cor-
related with negative psychological items (such as radical prejudice) (Batson
and Ventis, 1982). Similar assertions by Allport and Ross (1967) stated that
intrinsically religious individuals represented the positive end toward which
religion was striving, since these individuals tend to be more helpful, more
loving, and less prejudiced. Hence, the hypothesis developed by above dis-
cussed literature is as follows:
Hypothesis 1: Religious orientation has a significant impact on employees’
competitive behavior.
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Attitudinal Link to Behavior

Scharrer (2015) studied the employee’s acceptance of and involvement in
the management of business behavior. They focus on the code of conduct
as the planned behavior theory, which forces employees to implement the
code of conduct in the business environment. They found that the moti-
vation level of an individual was influenced by their attitude towards
the specific behavior and the influence of other people. Sommestad
et al. (2015) stated that behavior is prejudiced by individuals’ intentions
and certain behavioral controls, where definite behavioral controls restrain
the intended outcomes. Utmost solicitations use perceived behavioral

control as a substitution because of the complications allied with quanti-
fying definite behavioral control. The theory states that intentions are
prejudiced by attitude, perceived norms and perceived behavioral control.
Their impacts are supposed to be in line with each other, which can be
demonstrated by means of preservative prototypes.
Silva et al. (2014) said that intention directly influences behavior and is
resolute by the collaboration of three dissimilar and significant experiences
(attitudes, subjective norms and perceived behavioral controls). Attitude
toward the behavior is an individual’s global valuation of the behavior.
Individuals evaluate behavior based on their beliefs about the penalties of
the behavior (behavioral opinions) and the conforming optimistic or un-
desirable decisions about each structure of the behavior (result valuations).
Ajzen (2002) gathered data and tested it with a hierarchical factor model to
study the impact of attitude towards the behavior with respect to the Theory
of Planned Behavior. He stated that, in their corresponding combinations,
behavioral beliefs come from a blessed or negative disposition concerning
the behavior. It is given a satisfactory measure of distinct control over the
behavior, and people are expected to draw out their aims when the behavior
arises. Hereafter, the hypothesis projected by above discussed literature is
as follows:
Hypothesis 2: Attitude has a significant impact on employees’ competitive
behavior.
Perceived Behavioral Control Link to Behavior

Hsu and Kuo (2003) related organizational-based self-esteem in protecting
information privacy to TBP. It was shown that perceived behavioral control
shows an optimistic influence on intentions, and organizational-based self-
esteem can be effectively used to measure the outcome. Intention highly
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affected by perceived behavioral control. Buchan (2005) carried out a study

regarding the ethical decision making in the public accounting profession
by focusing on TPB. He posited that if a person expects a constructive
consequence and senses that significant others would boost such behavior,
progressive intentions are expected as outcomes. Henle et al. (2010) con-

ducted another study on TPB. Their empirical results showed that greater
perceived behavioral control leads to tougher intentions to execute that
behavior. People usually carry out such behaviors when they are not sat-
isfied with the job or there are other factors controlling or influencing them.
Hoek and Jones (2011) studied the effect of moods on healthy behaviors
and showed that there is no significant interaction between mood and

healthy behaviors. Therefore, the hypothesis implied by above discussed
literature is as follows:
Hypothesis 3: Perceived behavioral control has a significant impact on
employees’ competitive behavior.
Subjective Norms Link to Behavior

Blok et al. (2015) researched more sustainable behavior in households,
focusing on the identification of factors that have an impact on sustainable
or pro-environmental behavior. According to the findings of this study, the
TPB could explain pro-environmental behavior in the workplace. Findings
suggested that especially social norms and leadership support the impact of
pro-environmental activities on impact on pro-environment behavior in the
workplace. Furthermore, the study added that environmental awareness and
personal norms have a significant impact on the intention to act pro-
environmentally.
Teo and Lee (2010) stated that an individual’s act is resolute by be-
havioral intentions, which are thus biased by their respective state of mind
toward the behavioral and subjective norms. Social norms impact the
individual’s choice and behavioral intention. As stated by Sunstein (2001),
social norms help an individual decide how to react in a prescribed situa-
tion. Social roles are present in society to help people react appropriately in
different situations and assess the intentions behind a behavior. Social
norms and social roles go hand-in–hand, as both require each other’s ex-
istence to work smoothly. The result suggested that social life cannot
prevail without societal norms and roles. Bang et al. (2014) stated that the
TPB involves the three constructs of attitude, subjective norms, and per-
ceived behavioral control, which can influence intentions and genuine
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behavior. They also discussed the role of perceived behavioral control and
subjective norms as interpreters of intentions and the collaborative influence
of brand status between subjective norms intentions, and attitudes. Conse-
quently, the hypothesis proposed by above discussion literature is as follows:
Hypothesis 4: Subjective norms have significant impacts on employees’

competitive behavior.
Figure 1. CFA Results.
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Intention Link to Behavior

Ajzen and Fisbbein (1974) investigated 144 subjects to check the rela-
tionship between intention and behavior. Conferring the results, intention
were found to be significantly related to behavior. Conner and
Armitage (1998) initiated the critical review on TBP and suggested that
intentions are positively related to behavior. Schifter and Ajzen (1985)
inspected 62 respondents input to predict the user’s intention to weight
lose. They also found the low but significant relationship between
weight lose intentions and behavior. They explained that losing weight isn’t
a total behavior, only related aspects like diet or exercise consider as the
behavior outputs. Hence, those respondents who strongly intended to lose
weight and believed that they were capable of doing were most likely
to success.
Armitage and Conner (2001) meta-analysis results explained the average
multiple correlation of intention and behavior by 0.47, which accounted for
22% of the variance (R 2 ¼ 0:22). Staats et al. (2004) examined the effects
of 150 Dutch people participation in a program on changes in household
behavior and environmental resources. They posited that intention was
more important for pro-environmental behavior. Lastly, the hypothesis in-
ferred by above discussed literature is as follows:
Hypothesis 5: Intention has a significant impact on employees’ competi-
tive behavior.
METHOD
Available literature on TBP indicates the flexibility of the theory to absorb

religion orientation. To prove our point, the small and medium enterprise
sector is selected due to its significant contributions to generating em-
ployment and GDP. The study is quantitative in nature. A self-administered
survey was conducted to collect primary data. A convenience sampling
technique was used for this study, where employees working in SMEs
operating in Karachi were contacted to voluntarily participate in the
survey. SMEs selection were based on accessibility and English under-
standing basis. Firstly, SMEs contacted to participate in survey by personal
visit or by phone call in main industrial areas of Karachi. For contact
details, we refer to website www.phonebook.com.pk. After getting positive
response, we share questionnaire by mail and person. We approach
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approximate 775 people to participate in survey, 559 responded the survey

questionnaire, and 514 found appropriate for analysis, leading to a response
rate of 91.9%.
The participants were 72% males and 28% females. The respondents
came from a variety of age groups; 22.9% were under 30 years of age, 42%
were between 31 and 45 years, 29.3% were between 46 to 55 years, and
4.8% were between 56 and 65 years. In all, 44.9% percent of the respon-
dents were senior-level employees, and 49.6% were junior-level employees;
5.4% of responses were missing these data. Questionnaire consists of total
35 items. The questionnaire items distribution was: two questions about
organization demographics, five questions respondent profile, eight ques-

tions for intrinsic religious orientation, four each for employee behavior,
employee attitude, employee subjective norms, four for perceived behavior
control and employee intention. Intrinsic religious orientation, employee
behavior, employee attitude, employee subjective norms, four for perceived
behavior control and employee intention items were scored on a five-
point Likert scale ranging from “1 ¼ not at all” to “5 ¼ very great extent”
(see Appendix A). Intrinsic religious orientation were measured by
adopting the Allport and Ross (1967) scale, which was further adapted in
perspective of agreeable aspects of Islam by dominated Islamic groups. To
fulfill the requirement of content validity, dominated Islamic groups’
preachers shared their opinion on intrinsic religious orientation items. All of
contacted preachers agreed on the contents of the construct. Likewise, TBP
variables were also measured by adopting Fishbein and Ajzen (2010),
which was further adapted. Confirmatory factor analysis was used to ex-
amine the factor structure of the variable set. Furthermore, multiple linear
regressions were used to measure the impact of attitude, subjective norms,
behavioral control, religious orientation and intentions on employee
behavior.
Sufficient evidence was found in the literature to support the conten-
tion that TPB is flexible in the context of religion and industry. Hence,
this study attempts to implement empirical findings to address the gap in
the behavioral literature by examining the impact of TPB’s three pre-
dictors on intentions while adding religious orientation as a fourth
predictor of TPB. These four dimensions are further termed ‘human in-
ternalization factors’. Although the empirical evidence between intentions
and its determinants are well documented, the literature provides no ev-
idence exploring the relationship between religious orientation and
intentions. Thus, the current research seeks to offer new theoretical
insights into the TPB concept.
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FINDINGS
This section depicts the results and findings of the data collected from
respondents. Confirmatory factor analysis is applied to validate the fac-
torability of the model and confirm the dimensions of the indicators. In

addition, multiple regression analysis was applied as a statistical technique
to test the hypotheses. The rationale for using MLR was the nature of the
variables (continuous dependent and independent variables). In the current
study, our dependent variable was a composite score of behavior, and the
independent variables were subjective norms, attitude, behavioral control,
religious orientation and intention.
CFA Results
The empirical results show the constructed CFA model’s fitness. Confir-
matory factor analysis is used in situations where theoretical constructs are
required to be tested based upon respective indicators. CFA is a useful
technique to test the reflective measure models. Current analysis is run
using AMOS software. The following Table 1 shows the model’s fitness,
where relative Chi square, CFI, TLI and RMSEA are the most common
model fitness criteria. The following is the summary table (1) of the applied
CFA test.
The value of Chi square (CMIN/DF) is 1.549, which is supposed to be
less than 3 as suggested by Kline (2011). Moreover, the Comparative Fit
Index (CFI) is 0.946, which is considered as an acceptable value, as indi-
cated by Hair (2010). The Tucker Lewis Index (TLI) is 0.938, which also
indicates the model’s fitness, as the range lies between 0 and 1. Lastly, the
Root Mean Square Error of Approximation is 0.047 and shows fitness, as
values less than 0.07 show good fit (Steiger, 2007). The results show that
the overall model was a good fit.
Table 1. CFA Model Fit.
Test Result
Relative Chi Square (CMIN/DF) 1.549

Comparative Fit Index (CFI) 0.946
Non-normed-fit Index (TLI) 0.938
Root mean square error of approximation (RMSEA) 0.047
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Regression Analysis Results

The model’s summarized regression results are shown in Table 2. The R 2 is
0.334, which shows that 33.4% of the variance in employee behavior is
influenced by these independent variables. Therefore, applying for these
five independent variables would explained for 33.4% of the change in

employee competitive behavior. The Durbin and Watson (1951) value
shows that there is no autocorrelation issue in the data.
The ANOVA table below shows the test for model fitness. This Table 2
represents the F-test value, which helps researchers to determine the fitness
of the model. The significance of the F-test represents that the model is not
a chance or random model. Hence, Table 2 shows that model is significant
and fit, as the significance value is less than 0.05.
In Table 4, all the variables have significance values of less than 0.05
except for subjective norm, which is insignificant, as it has a significance
value of greater than 0.05. Religiosity seems to be the most contributory
variable in the model, as it has the highest standardized beta coefficient of
0.518. Moreover, Table 4 shows that all the VIF values are less than 5
and all the values of tolerance are greater than 0.3. Therefore, there is no
significant multicollinearity issue.
Table 2. Model Summary.
Adjusted R Std. Error of

Model R R Square Square the Estimate Durbin–Watson
1 0.578 a 0.334 0.328 1.93200 1.641
Notes: a Predictors: (Constant), Subjective Norms, Religiosity, Attitude, Perceived

Behavior C, Intention.
Dependent Variable: Behavior.
Table 3. ANOVA.
Model Sum of Squares Df Mean Square F Sig.
1 Regression 777.701 4 194.425 52.088 0.000 a

Residual 1549.042 415 3.733
Total 2326.743 419
Notes: a Predictors: (Constant), Subjective Norms, Religiosity, Attitude, Perceived

Behavior C, Intention.
Dependent Variable: Behavior.
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Table 4. Coefficients.
Unstandardized Standardized Collinearity

Coefficients Coefficients Statistics
t
Model B Std. Error Beta Sig. Tolerance VIF
Constant 3.843 0.851 4.516 0.000

Religiosity 0.298 0.023 0.518 12.873 0.000 0.990 1.010
Attitude 0.176 0.033 0.271 5.315 0.000 0.618 1.618
Perceived Behavior 0.079 0.033 0.135 2.362 0.019 0.489 2.045
Subjective Norms 0.064 0.034 0.127 1.879 0.061 0.349 2.868
Intention 0.271 0.67 0.448 2.143 0.002 0.581 2.189
Note: Dependent Variable: Behavior.
The hypothesis that religious orientation has a significant, positive im-

pact on employees’ competitive behavior has been accepted, as the sig-
nificance value is less than 0.05 and the beta value is 0.298. This result can
be interpreted as an increase in religious orientation leading to a higher
value for behavior. Moreover, attitude has a significant, positive impact on
employees’ competitive behavior, as the significance value is less than 0.05
and the beta value is 0.178. This result can be interpreted as an increase in
attitude leading to a higher value for behavior. Additionally, the proposition
that perceived behavioral control has a significant positive impact on
employees’ competitive behavior has been accepted, since the significance
value is less than 0.05 and the beta value is 0.079. This result can be
interpreted as when a perceived behavioral control is increased, a higher
value of behavior is obtained. Moreover, subjective norms (specific) has an
insignificant impact on employees’ competitive behavior, as the signifi-
cance value is greater than 0.05. Lastly, the hypothesis that behavioral
intention has a significant, positive impact on employees’ competitive be-
havior has been accepted, as the significance value is less than 0.05 and the
beta value is 0.271. This result can be viewed as one’s intentions forming
one’s behavior.
DISCUSSION
The results of the study implies that intrinsic religious orientation has a
positive impact on a worker’s behavior. It can be implied that an increase in
intrinsic religious orientation would lead to a higher value for behavior. These
results are consistent with past researches (i.e. Allport and Ross, 1967;
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Bergin, 1991). One possible reason for this outcome might be that if a
particular behavior is endorsed by religious guidelines, people are more
likely to show their positive intentions towards that behavior and end up
following that behavior. On the other hand, employees’ attitudinal beliefs
have a positive impact on behavior. It can be interpreted that a favorable

attitude towards an entity would lead to acceptability and adoption of the
behavior of that particular entity. These results are consistent with past
theories and empirical research. As in the Theory of Reasoned Action
(Fishbein and Ajzen, 1975) and the Decomposed Theory of Planned Be-
havior (Fishbein and Ajzen, 1981), attitudinal beliefs are one of the major
determinants of behavior acceptability and adoption.

Furthermore, perceived behavioral control has shown a significant im-
pact on employees’ competitive behavior. This represents that perceived
behavioral control has a positive influence on behavior. It can be seen that a
higher perceived behavioral control will lead to greater acceptability of that
behavior. These results are consistent with past theories and empirical re-
search. As in the Decomposed Theory of Planned Behavior (Fishbein and
Ajzen, 1981), perceived behavioral control is a major factor for behavioral
adoption. Surprisingly, subjective norms have shown to have an insignifi-
cant impact on employees’ competitive behavior. These results are in
contrast to previous research (e.g., Ghouri et al., 2016) and established
theories. One possible reason for this contradiction may be the demo-
graphics and culture of the targeted population. The other possible reason is
normative belief. After reaching a certain age, middle-aged and senior
persons value their own beliefs and past experience more in dealing with
certain situations rather than relying upon the opinions of others.
Lastly, behavioral intention has shown a significant impact on employ-
ees’ competitive behavior. This represents that behavioral intention has a
positive influence on actual behavior. It can be seen that higher behavioral
intentions will lead to a greater formation of that behavior. These results are
consistent with past theories and empirical research i.e. Decomposed
Theory of Planned Behavior (Ajzen, 1991) behavioral intention is one of
the major factors of behavioral adoption.
CONCLUSION
The main purpose of study was to incorporate the intrinsic religious

orientation in TPB. Effective engagement of employees at the work-
place occupies a strategic place between the social environment and
99
A. M. Ghouri et al.
organizational policies. Since religiosity cannot be ignored at the work-

place, its adaptation in TBP improves employees’ competitive behavioral
outcomes. The empirical findings of this study can guide SME owners and
managers on how to better engage employees at work. Religious orientation
clearly contributed to the prediction of job intentions and behaviors.

Owners and managers should practically implement intervening strategies
focused on religious orientation along with other predictors of TBP to
improve employee intentions and their subsequent work behavior.
In perspective of Pakistan, there are many school of thoughts within Islam.
Hence, SMEs managers need to adjust and motivate the individuals’ mindset
in perspective of religiosity. The findings suggest that owners and managers

of SMEs should ensure that they place some efforts into providing support to
increase religious orientation in SMEs, as it would likely enhance all other
factors. Acceptable architectural elements, infrastructure cues and decoration
for all Islamic groups can improve the employees’ behavior. Periodic sessions
with employees with the blend of professional practices and religious ori-
entation can also play a positive part employee behavior.
Furthermore, based on empirical evidence, the adaptation of religious
orientation in TPB will likely have a positive impact on workplace inten-
tions and behavior. It aids the bridging of the gap between the organization
and employee performance. Specifically, SMEs should integrate religious
orientation into their human resources framework. A collective approach is
required to align TPB functions with religious orientation. Hence, SME
owners and managers should develop a framework according to their needs.
It has been observed that religious orientation use to vary within individual
capacity. The new face of TBP will increase the working behavior of
employees and enhance their performance in the organization. This in turn
will enhance organizational performance. SME owners and managers
should encourage religious liberty among employees, that every group
(firqa) of Islam follow their beliefs and rituals. However, there is a need to
develop a flexible model to address the sensitivity of religion to avoid any
conflict, especially in multiple religious organizations. This study findings
also shows religious orientation would lead person to inner motivation and
primary source of community.
LIMITATIONS AND FUTURE RESEARCH
While this research contributes to our understanding of the religious ori-

entation and its influence on employees’ commitment behavior, there are a
100
few limitations affecting the interpretation of results and conclusions. First,

the findings in this study are further derived only from two samples of
SMEs in the textile and health care industries. Other industries like fruits
and vegetables, fisheries and agriculture can be decent target for research.
Second, research could also include an assessment of the overall team

climate to determine its effect on desired team performance (Wijesekara
et al., 2016). There are several Islamic groups exists in Pakistan and there
could the case of other religion individual in team. Third, the male
responses were dominant in the study, which can lead to method bias.
Fourth, data was comprised of one religious group, and including other
religions could be pivotal. Hindus and Christians are in minority groups but
they are running SMEs businesses around the country. Fifth, we should add
the perspective of other members of an organization, such as support staff.
In the future, intrinsic religious orientation could be used as a mediator in
TBP. Sixth, intrinsic religious orientation scale can be adapted in other
religion perspective which could elaborate the interesting results. Another
suggestion is to check happiness constructs in the proposed model.
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APPENDIX A
Theory of Planned Behavior and Employee Competitiveness:

A Pakistan Survey
SECTION A
A1. Demographics of organization
1. How many employees does your organization have?
21–50 ¤
51–100 ¤
101–200 ¤
201–250 ¤
2. When was your organization established?
Less than 1 year ago ¤
1 to 2 years ago ¤
2 to 3 years ago ¤
3 to 5 years ago ¤
5 to 10 years ago ¤
More than 10 years ago ¤
A2. RESPONDENT PROFILE
1. What is the management level of your current work position? (Please

tick the box that indicates the nearest equivalent)
Chief Executive Officer ¤
Manager reporting to CEO ¤
Middle manager ¤
Supervisor ¤
Other (Please specify) ___________
2. What is your marital status?
Married ¤ Single ¤
3. Please indicate your gender:

Male ¤
Female ¤
107
A. M. Ghouri et al.
4. What is your highest level of formal education?

Secondary school certificate ¤
An undergraduate degree ¤
Postgraduate diploma/certificate ¤
Postgraduate degree ¤
Other (please specify) ____________
5. Which is your age group?

Under 30 years ¤
31–45 years ¤
46–55 years ¤
56–65 years ¤
More than 65 years ¤
SECTION B
1. RELIGIOUS PRACTICES
Very Great Extent

Moderate Extent
Large Extent
Small Extent
Not at All
To What Extent do the Following Statements

Describe the Current Practice in Your
Organization? Encircle the Appropriate
Number for Each Item Listed.
a Performed Nafl prayers to seek help from Allah. 1 2 3 4 5

b Made a manta in the name of Allah and pledged to 1 2 3 4 5
fulfill that vow if the problem was solved.
c Sought the company of the righteous men close to 1 2 3 4 5
Allah to obtain their dua for the solution of the
problem.
d Read special Wazaef for the removal of the problem 1 2 3 4 5
e Read special duas for the solution of the problem 1 2 3 4 5
f Made a manta to hold a Quran Khawani or some 1 2 3 4 5
similar religious gathering if the problem was
solved
g Held a special religious gathering such as a Khatam 1 2 3 4 5
for the solution of the problem
h Gave Sadaqah in the name of Allah 1 2 3 4 5
108
2. BEHAVIOUR
Very Great Extent

Moderate Extent
Large Extent
Small Extent
Not at All
a Employee in my company share know-how from 1 2 3 4 5

work experience with each other.

b Employee in my company share expertise obtained 1 2 3 4 5
from education and training methods
c Employee in my company share business knowledge 1 2 3 4 5
obtained informally (such as news stories, and
gossips)
d Employee in my company share business knowledge 1 2 3 4 5
from partners. (Such as customers, suppliers, and
allies)
3. ATTITUDE
Very Great Extent
Moderate Extent
Large Extent
Small Extent
Not at All

a Encouraging knowledge sharing with colleagues is an 1 2 3 4 5

important component of the policy of my company.
b Encouraging knowledge sharing with colleagues is a 1 2 3 4 5
good idea.
c Encouraging knowledge sharing with colleagues is 1 2 3 4 5
valuable.
d Encouraging knowledge sharing with colleagues is 1 2 3 4 5
beneficial.
109
A. M. Ghouri et al.
4. SUBJECTIVE NORMS
Very Great Extent

Moderate Extent
Large Extent
Small Extent
Not at All
a Those who influence my decisions think that I Should 1 2 3 4 5

encourage employees to share their knowledge

with colleagues
b Those who influence my decisions think that I should 1 2 3 4 5
share knowledge with colleagues.
c Those who are important to me think that I should 1 2 3 4 5
encourage employees to share their knowledge
with colleagues
d Those who are important to me think that I should 1 2 3 4 5
share knowledge with colleagues
5. PERCEIVED BEHAVIORAL CONTROL

Very Great Extent
Moderate Extent
Large Extent
Small Extent
Not at All

a My past experience has increased my confidence in 1 2 3 4 5

my ability to make decisions encouraging
employees to share knowledge with colleagues.
b Encouraging knowledge sharing with colleagues is 1 2 3 4 5
within my control in my company.
c I have the resources, abilities, and knowledge to make 1 2 3 4 5
a decision facilitating employees in sharing
knowledge with colleagues
d I am always likely to share knowledge 1 2 3 4 5
110
6. INTENTIONS
Very Great Extent

Moderate Extent
Large Extent
Small Extent
Not at All
Describe Your Organization? Encircle the Appropriate
a Employee in my company intended to share know- 1 2 3 4 5

how from work experience with each other.

b Employee in my company intended to share expertise 1 2 3 4 5
obtained from education and training methods
c Employee in my company intended to share business 1 2 3 4 5
knowledge obtained informally (such as news
stories, and gossips)
d Employee in my company intended to share business 1 2 3 4 5
knowledge from partners. (Such as customers,
suppliers, and allies)
111

Religiosity Effects On Employees in Smes: An Islamic Country Perspective

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Journal of Enterprising Culture

Vol. 26, No. 1 (March 2018) 85–111

Religiosity Effects on Employees in SMEs:

Arsalan Mujahid Ghouri*

Montpellier Business School, Montpellier, France

Omar B. Abdul Kareem

This study aims to investigate the adaptation of internalization factors and

Keywords: Religious orientation; employee workplace behavior; theory of

The cultures of countries or organizations shape individual actions.

sidered a component of an individual’s cultural heritage and a determinant

backbone of any organization, and efficiency and effectiveness of resources

that organizational-level competencies are embedded in employee-level

in an employee’s organization and profession. Wright and Geroy (2001)

engenders the shape of behavior, which is strongly followed by people.

employees’ competitive behavior through an effective adaptation of TBP

tencies were instrumental in improving organizational effectiveness. Ulrich

1993), and most importantly, employee/executive behavior (e.g. Ajzen,

Religiosity Link to Behavior

positive effect on academic achievement and school-related behavior.

have a more positive attitude towards work as a duty. Perez-Villadoniga

illustrated by different studies as well (e.g. Audretsch et al., 2013; Black-

Attitudinal Link to Behavior

the intended outcomes. Utmost solicitations use perceived behavioral

Perceived Behavioral Control Link to Behavior

affected by perceived behavioral control. Buchan (2005) carried out a study

progressive intentions are expected as outcomes. Henle et al. (2010) con-

and showed that there is no significant interaction between mood and

Subjective Norms Link to Behavior

Hypothesis 4: Subjective norms have significant impacts on employees’

Figure 1. CFA Results.

Intention Link to Behavior

Available literature on TBP indicates the flexibility of the theory to absorb

approximate 775 people to participate in survey, 559 responded the survey

organization demographics, five questions respondent profile, eight ques-

torability of the model and confirm the dimensions of the indicators. In

religious orientation and intention.

Table 1. CFA Model Fit.

Relative Chi Square (CMIN/DF) 1.549

Regression Analysis Results

five independent variables would explained for 33.4% of the change in

Table 2. Model Summary.

Adjusted R Std. Error of

1 0.578 a 0.334 0.328 1.93200 1.641

Notes: a Predictors: (Constant), Subjective Norms, Religiosity, Attitude, Perceived

Model Sum of Squares Df Mean Square F Sig.

1 Regression 777.701 4 194.425 52.088 0.000 a

Notes: a Predictors: (Constant), Subjective Norms, Religiosity, Attitude, Perceived

Unstandardized Standardized Collinearity

Model B Std. Error Beta Sig. Tolerance VIF

Constant 3.843 0.851 4.516 0.000

Intention 0.271 0.67 0.448 2.143 0.002 0.581 2.189

Note: Dependent Variable: Behavior.

The hypothesis that religious orientation has a significant, positive im-

have a positive impact on behavior. It can be interpreted that a favorable

determinants of behavior acceptability and adoption.

The main purpose of study was to incorporate the intrinsic religious

organizational policies. Since religiosity cannot be ignored at the work-

clearly contributed to the prediction of job intentions and behaviors.

in perspective of religiosity. The findings suggest that owners and managers

LIMITATIONS AND FUTURE RESEARCH

While this research contributes to our understanding of the religious ori-

few limitations affecting the interpretation of results and conclusions. First,

Second, research could also include an assessment of the overall team