Statistics Deskripstif Classical assumptions Service Innovation Service delivery refers to the actual delivery of services

The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia 173 The object of the research is the Regional General Hospital Hospital Cilacap. The population in this study were inpatients in hospitals and hospital employees in Cilacap. The size of the sample and the population can be determined by using the formula Slovin. The sampling technique for patients is done by sampling incidental according Sugiono 2007: 67, namely sampling technique based on chance, that anyone who happened incidental met with researchers can be used as a sample, if it is deemed the person who happened to be found suitable as a source of data. While the techniques used in the sampling of employees is a probability sample selection techniques, namely the selection of a simple random sample random sampling according Sugiono 2007: 64 that provides equal opportunity and are not limited to any element of the population to be selected as a sample.

b. Operational Definition of Variables

Variables in this study using the independent variables and the dependent variable. The independent variable in this study is the quality of public services X1, the quality of public services is the extent to which a public facility public in providing services to the public, and good public governance X2, which is a conception of democratic governance clean, and effectively in accordance with the ideals of the formation of a civil society. The dependent variable Y in this study was the performance of public hospitals, hospital performance is a picture of the extent to which the success or failure of a hospital in carrying out its duties and functions principally in order to realize the goals, objectives, vision, and mission.

c. Data

Data used in this study are primary and secondary data. Primary data in this study are distributing questionnaires to patients and employees and secondary data in the form of literature and books.

d. Data Analysis Techniques

The analysis technique used in this study are regression and correlation. Regression analysis to determine the shape of the relationship between independent and dependent variables. While the correlation analysis aims to identify and find the relationship between variables.

8. Results

a. Validity and Reliability

1 Validity Measurements conducted to determine the validity of the accuracy and precision of the measuring instrument in carrying out the measurement task Singarimbun and Effendi, 1955. In this study the validity of the test was conducted to test whether each item question the variable quality of public ministry, good public Governace, and the performance of hospitals that are used as a measuring tool in the study really can mengungkapakan variables studied. Criterion validity testing is to compare the validity correlation r count with r product moment correlation table of 0.444 with α = 0.05. The calculations show that all the questions in the questionnaire items coined the sig 0.05, which means that the questions in the questionnaire are valid and can be used as a data collection tool. 2 Test Reliability Notoatmodjo 2005a stated that the reliability measurements indicate the extent to which the measuring instrument can be trusted or relied upon and continued to show the same accuracy when used repeatedly. Reliability tests performed to demonstrate whether it can provide the measurement results are relatively unchanged or inconsistent. If the measurements back to the same object. The results of the analysis will be reliable according Sugiono 1992 where r is bigger than r table is 0.60. Reliability value of the variable performance of the hospital of 0.827, 0.767 for service quality, public governance dangood of 0.727. Results of analysis shows that all variables have a value of α 0.6. Based on the results obtained can said that otherwise reliable measurement tool to be used as a data collection tool.

b. Statistics Deskripstif

Descriptive statistical test results showed that the mean hospital performance variable 87.27 with a standard deviation 5.63. Mean public service quality variables 61.56 with standard deviation 3.79, and good public governance variables have mean 49.69 with a standard deviation of 3.13.

c. Classical assumptions

In normality test sig = 0.826 thus sig 0.826 0.05. This means that the data are tested including normal distribution. multicollinearity test indicates that the variable quality of public services has VIF = 1.916 thus 1.916 10 and good public governance variables have VIF = 1.916 thus 1.916 10 and all independent variables tolerance 0.522 = 52.2 above 10, it can be concluded that between the independent variables do not occur multicollinearity. Heteroscedasticity test indicates the variable quality of public services have a sig = 0.213 thus sig 0.213 0.05 and has good public governance variables sig = 0.60 thus sig 0.60 0.05. These results indicate that all independent variables have a sig 0.05, so it does not happen heteroscedasticity.

d. Hypothesis Testing

1 Effect of Public Service Quality Performance Against Hospital Cilacap Based on the results of multiple regression test The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia 174 and obtained a sig = 0.02 thus sig 0.02 0.05 and 0.483 B is positive +. This means that there is a positive and significant influence between the quality of public services to the performance of the hospital, so the hypothesis 1 is accepted. In his research, Pelham 1997 showed that the profitability of the organization relies heavily on the ability of the organization to deliver products that are of superior quality and reliable that they produce. Thus, in the context of services, this may mean that the actual profitability of the company depends on the extent to which companies can provide a quality service to its customers to be able to give satisfaction to the consumer. Relation to the quality of public services to the performance of the hospital is a hospitals profitability depends on the ability of the hospital itself in doing a quality service. Thus, if the services provided by the hospitals quality will be able to eat by itself gives satisfaction to the patient. Meanwhile the results of research Chang and Chen 1998, which examines the relationship between market orientation, quality of service with the companys performance shows that the behavior of the employee services are closely related or have a positive impact on the profitability of the company. Research results in a somewhat different context was also providing support to the positive relationship between service quality and organizational performance. In general, the results of this study indicate that the quality of services provided by employees have a positive influence on the performance of the company or organization. For example, in a study Church 1995 showed that the behavior of the employee services can improve organizational performance. 2 Effect of Good Public Governance Performance Against Cilacap General Hospital The results of multiple regression test and obtained a sig = 0.029 thus sig 0.029 0.05 and B 0,548 is positive +. This means that there is a positive and significant influence between good public governance on the performance of the hospital, so the hypothesis 2 is accepted. In line with Jandik and Rennie 2005 who conducted research on the effect of the implementation of good corporate governance on the performance of companies that have gone public in the emerging capital markets emerging markets, in particular, this study describes the evolution of corporate governance and corporate performance in emerging markets. The results of this study showed a significant relationship between the implementation of good corporate governance on firm performance. According to Brown and Caylor 2004 conducted a study of the companies listed on the New York Stock Exchange and implement good corporate governance based on an assessment Gov- Score published by the Institutional Shareholders Services. In the assessment of the implementation of good corporate governance, there are eight main thing being the main indicators, namely: audit, board of directors, law, education directors, compensation to the board of directors and executives, progressive practices and state of incorporation. The results of this study indicate that good corporate governance and significant positive effect on firm performance. 3 Relationship between the Quality of Public Services with Good Public Governance in Cilacap General Hospital Results obtained values of correlation and thus sig = 0.000 0.000 sig 0.05 and Pearson Correlation = 0.691 is positive +. This means that there is a positive correlation between the quality of public services with good public governance, thereby third hypothesis is accepted. In line with the research Dwiyanto 2005 which states that good governance as a policy is taken, is a tool for accelerate achievement of development goals. Application of the concept of good governance strategy that is so broadly be done by the government in stages according to the capacity of governments, civil society and the market mechanism. One of the strategic options for the development of the concept of good governance in Indonesia is through the development of public services that characterize the values that have been attached to good governance. 4 Effect of Quality of Public Services In Together with Good Public Governance Performance Against Cilacap General Hospital The results of multiple regression test and obtained a sig = 0.000 thus sig 0.000 0.05 and F values in the table shows the influence of the variables X1 and X2 are jointly to variable Y. This means indicates that there is a positive and significant influence between the quality of public services and good public governance together on the performance of the hospital, so the hypothesis 4 is accepted. In line with the research conducted by Mulyawan 2009 states, the implementation of good governance together with the performance of the service has a relationship with the performance of the service user satisfaction.

9. Conclusion

Based on the results obtained conclusions: The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia 175 a. There is a positive and significant influence between the quality of public services to the performance of the hospital. b. There is a positive and significant influence between good public governance on the performance of the hospital. c. There is a positive correlation between the quality of public services with good public governance. d. There is a positive and significant influence between the quality of public services and good public governance together on the performance of the hospital.

10. Suggestions

a. For Cilacap District General Hospital Cilacap General Hospital is expected to improve the quality of services and facilities to be better again. To generate patient satisfaction with the performance of the employees should also be further enhanced. b. For further research, is expected to more than one study object so that the object can dilakukkan comparison and also needs to be studied more in depth other variables were included in the study were associated with increased hospital performance. REFERENCES Adisasmito, Wiku. 2007. Sistem Manajemen Lingkungan Rumah sakit. Jakarta: PT. Rajawali Press. Andranik, Aldila Yugha. 2011. Penerapan Balanced Scorca rd Sebagai Tolok Ukur Pengukuran Kinerja Pada Rumah Sakit Umum Daerah Jenderal Ahmad Yani Kota Metro Lampung . Skripsi Dipublikasikan. Fakultas Ekonomi Ekonomi. Perbanas Jakarta. Anonim, Kualita s Pelayanan Publik, http:www.psychologymania.com201212 pengertian-kualitas-pelayanan-publik.html . 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Waqf creates great benefits not only for the endower himselfherself but also for the whole society. It plays an important role in economic development by providing health facilities, education and worship place. This study is an on-going research that involves two phases of data collection; qualitative and quantitative phase. However, for this paper, authors are focusing on one phase of data collection that is qualitative phase and reveals the findings. Thus,for this study aims to explore endowment donor knowledge on waqf, factors that contributed to their participation in cash waqf, and experience in participating in waqf. In order to achieve the study objectives, focus groups were conducted involving endowment donors and officers from waqf institutions. Findings from the focus group showed that participants considered cash waqf as part of sadaqah whereby they believed that will be rewarded in the hereafter. Participants also acknowledged that the cash that they have contributed can be used by the public for construction of mosque or school. Participants participated in cash waqf due to several factors which include their awareness on cash waqf, previous waqf experience, knowledge on waqf, and availability of convenient channels to participate in waqf. Participants revealed that they were satisfied with the act of participating in cash waqf and have the intention to participate in cash waqf in the future. Nevertheless, participants felt insecured with regards to the distribution of waqf fund as they were not informed by the waqf instutitions. It is hoped that by understanding Muslim participation in cash waqf will be able to encourage Muslims to participate in cash waqf. Keywords: Cash waqf, endowment donor, Malaysia INTRODUCTION Waqf in Islamic termis an act of holding certain property and preserving it for the confined benefit of certain philanthropy that disallows any use or disposition of it outside the specific objective Kahf, 2009. In the Arabic langague, waqf means to stop, contain, or preserve. Waqf is permissible in Islamic law and it is a recommended practice in the light of al-Quran and Hadith. Waqfhas been effectively utilised since the early Madinah period to inspire economic growth and expansion. The benefits it has provided encompasses economic, commerce, education, health, social and spiritual dimensions Inceif, 2014. In general, waqf can be divided into two 2 types; 1 the immovable property `aqar and 2 movable manqul property Ab Rahman, 2009. Waqf is one way of sadaqah and it is recommended to practice it. However, there is no directly mentioned about the concept of waqffrom the holy Quran. Nonetheless, Allah has encourage to practice waqf through the verses on the sadaqah benefit in the Quran.From the Islamic scholar views, the contract of sadaqah is the donation process to expense their reward for the hereafter. This is illustrated from the verse of al-Quran as follows: نم ْاوقفنت امو وبحت ا م ْاوقفنت ىتح ربْلا ْاولانت نل ميلع هب هّ إف ءْيش Never will you attain the best [reward] until you spend [in the way of Allah] from that which you love. And whatever you spend – indeed, Allah knows about it. Al-Imran3:92 In 2007, the Malaysian National Fatwa Council has decided that cash waqf is allowed in Islam Ab Rahman, 2009. With this ruling, Muslim community in Malaysia is allowed to participate in cash waqf and it is increasingly popular due to its flexibility Pitchay et al., 2014.The cash waqf is a form of certificates with different denominations to raise money against the planned projects. The issued certificate will be bought by a number of individuals or institution to finance the planned projects. Separate cash waqf will be raised for each individual waqf activity.According to Muhammad Salleh 2009, cash waqf has the potential to promote the development of the ummah. The author estimated that the cash waqf collection in The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia | 178 Malaysia could reach USD1.19 billion a year if each Muslim adult Malaysian citizen donated USD0.28 a day or USD8.32 a month to the cash waqf fund. In Malaysia, several state religious councils have implemented the cash waqf scheme or known as waqf shares. The six states that offer this waqf shares are Penang Waqf Fund Scheme, Selangor Waqf Share, Pahang Waqf Shares, Johor Waqf Shares, Terengganu Cash Waqf Sceme and Malacca Waqf Shares. Study on the involvement of the Muslim community in waqf shares is finite but very instrumental in the economic development of Muslims Ab Rahman, 2009;Ibrahim Muhammad, 2013; Mahamood, 2007. Therefore, this study aims to explore endowment donor knowledge on waqf, factors that contributed to their participation in cash waqf, and experience in participating in waqf. RESEARCH METHODOLOGY This study employed qualitative research method as it aims to explore endowment donor knowledge on waqf, factors that contributed to their participation in cash waqf, and experience in participating in waqf. For the purpose of achieving the study objectives, focus groups were conducted for exploration and discovery of the research topic. A focus group is particularly useful for exploration and discovery Morgan, 1997. By forming a group of individuals together, and inducing a topic of discussion toward the collective attitudes and beliefs of the participants, the dynamic transmission of ideas will yield untapped responses and meaningful information Bryman, 1988. Conducting a focus group can be very time consuming, nevertheless, it produces very rich and in depth data expressed in respondents’ own words and reactions, which is normally difficult to obtain using other methods Ghauri and Gronhaug, 2002. Three 3 focus groups were conducted involving endowment donors and officers from waqf institutions. Participants were selected if they had experience of participating in cash waqf before. The focus group discussion was structured into several topics related to waqf in general. Participants were asked about their understanding on waqf. This includes their views on waqf, types of waqf, and waqf institutions operating in Malaysia. Participants were also asked on the factors motivating them to endow waqf. Then, they were asked to share their feelings and experiences after participating in waqf. The questions were mostly open ended. Method suggested by Casey 1989 has been followed in analyzing the focus group discussions.All of the focus groups discussions were audio taped and transcribed. After the focus groups discussions have been carefully typed, the transcripts were reviewed so that the researcher could become familiar with the flow of the dialogue. All transcripts were merged and then all of the answers to question one from all the groups were moved to the same master document. This was done for each topic and question. From this master document which contains all of the relevant responses, the patterns, trends or themes across all of the responses were examined. RESULTS AND FINDINGS For the purpose of reporting the results of the focus groups, findings are organised by topics that arose during focus groups that are relevant and pertinent to this study.Findings have been grouped according to the answers given on a specific question, yielding majority opinions and views. Generally, participants considered cash waqf as part of sadaqah whereby they believed that will be rewarded in the hereafter.Participants also acknowledged that the cash that they have contributed can be used by the public for construction of mosque or school. Participants participated in cash waqf due to several factors which include their awareness on cash waqf, previous waqf experience, knowledge on waqf, and availability of convenient channels to participate in waqf. Participants revealed that they were satisfied with the act of participating in cash waqf and have the intention to participate in cash waqf in the future. Nevertheless, participants felt insecure with regards to the distibution of waqf fund as they were not informed by the waqf instutitions. KNOWLEDGE ON WAQF Participants were asked on their knowledge about waqf.Findings from this study showed that participants were aware of the concept of waqf. They viewed waqf as sadaqah and believed that indviduals who contributed will be rewarded in the hereafter. Participants also understood the types of waqf which includes cash waqf, land, and house. Participants also mentioned that waqf contribution is for long term development such as for development of mosque and schools. Through waqf, a Muslim can achieve recurring charity whereby the benefits of the act flow to the needy repeatedly. Findings from this study also showed that participants have been exposed about waqf from several sources. These include campaign made by any waqf institutions, reading materials on waqf, and roadshows conducted by waqf institutions. The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia | 179 Others have been exposed about waqf during their formal study. “When I did my degree, I was taught about waqf, the concept of waqf and I was given an assignment on waqf”. “I got to know about waqf via advertisement. The spokesperson used in that advertisement was a famous actor and he made me want to seek more information on waqf”. FACTORS INFLUENCE PARTICIPATION IN WAQF Participants were asked factors that influence them to participate in waqf. Previous studies have shown that endowment donors attitude towards waqf, religious satisfaction, literacy of waqf, trustworthiness, demographic factor, efficent management and tax incentive were factors that motivate the public towards the contribution of cash waqf Pitchay, 2014; Htay, Mohamed, Osman, 2012; Osman, 2014. In this study, several factors have contributed their participation in waqf which include exposure and knowlegde on waqf, convenience to contribute and family influence. In addition, participants past experience in partcipating waqf and their commitment towards religion have influenced them to partcipate in waqf. “My uncle told my dad about waqf and motivate everyone to endow waqf as well”. “It is easy to partcipcate in waqf. I can go online and make the appropriate payment”. WAQF EXPERIENCE Participants felt that everyone can endow waqf since there are many channels available for them to endow. For instance, participants can contribute via online banking, and salary deduction. With the introduction of cash waqf, participants felt that they can contribute more. Before the Malaysian National Fatwa Council has decided to allow cash waqf as another type of waqf, participants had difficulties to contribute as waqf contibution is limited to immoveable property such as land and building. “I started to participate in waqf since the introduction of cash waqf because it I could not afford to waqf land or building”. It was found in this study that promotional activities conducted by waqf institutions can encourage the public to participate in waqf. Hence, the partcipants suggested that promotional activities such as roadshowtour, campaign and others are required to create public awareness on waqf and encourage their participation. Nevertheless, participants mentioned that they felt insecureinsecured with regards to the distribution of waqf fund as they were not informed by the waqf instutitions. To ensure transparency among the waqf institutions, the participants hope that waqf reporting should be carried out similar to zakat. CONCLUSION Research on Muslim involvement in cash waqf is rather limited. Resultsof thisresearch have identifiedfactors thatcontributed to participation of Muslim communityin the cash waqf and their experience. It is hoped that by understanding factors influence Muslim participation in cash waqf will be able to encourage Muslim to participate in waqf and promote waqf as a tool to alleviate poverty. On the other hand, the waqf institutions need to play an important and effective role in ensuring the implemenation of cash waqf as a whole would be part as financial instrument to the economic growth of Malaysia particularly Muslim. This can be an eye opener to the financial and education institutions to discuss seriously and have better plan in terms of mechanism, framework and implementation of cash waqf. It is hoped that, the future and potential of cash waqf can be seen as a new emergence of financial instruments in Islamic banking. REFERENCE Ab Rahman, A. 2009. 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Factors influencing the behavioral intentions of Muslim employees to contribute to cash waqf through salary deductions. Journal of King Abdulaziz University: Islamic Economics , 28 1, pp. 63-98 The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia 181 Room D Moderator: Prof. Dr. Heru Kurnianto Tjahjono Paper ID MP 019 : Antecedents and Consequences of Service Culture in The Public Sector Services Company in Bengkulu Sularsih Anggarawati Fachri Eka Saputra Paper ID MP 020 :Structural Equation Modeling Qorganizational Culture, Internal Marketing and Knowledge Management in Private Hospital Company in Bengkulu Muhartini Salim, Praningrum Nurhasanah Paper ID MSDM 017: Unified Knowledge Sharing as Antecedent to the Implementation of Organizational Innovation Ika Nurul Qamari Julitta Dewayani Paper ID MSDM 018: Organizational Commitment Among Professions Retno Setyowati Paper ID MSDM 022: Mediating Role of Job Satisfaction on Effects of Compensation Distributive Justice, Compensation Procedural Justice, Person Organization Fit PO-Fit on Organizational Commitment Nur Wahyunianti Dahri Heru Kurnianto Tjahjono Paper ID MSDM 024: Analysis the Influence of Quality Work Life on Job Satisfaction and Employee Performance Wandi Riswandi Heru Kurnianto Tjahjono Paper ID MSDM 025: The Influence of Islamic Work Ethic on Organizational Commitment with Intrinsic Motivation and Job Satisfaction as an Intervening Variable Syamsul Hidayat Heru Kurnianto Tjahjono The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia | 182 Antecedents and Consequences of Service Culture in the Public Sector Services Company in Bengkulu Sularsih Anggarawati 1 , Fachri Eka Saputra 2 1 Department of Management, Economic and Business Faculty, Bengkulu University masdjati_saiyahoo.co.id 2 Department of Management, Economic and Business Faculty, Bengkulu University fach1910gmail.com ABSTRACT Government services in public sector in Indonesia are perceived inefficient, slow, convoluted, and overlapping. Bad bureaucracy of public sector in Indonesia is believed to be the causes of the decline in the competitiveness of Indonesias economic position. Problems associated with a convoluted bureaucracy can be resolved if the organization has an excellence service culture. The aims of the study are to develop service culture dimensions for public sectors and to examine the relationship between service culture, service innovation and organizational performances. Two hundred questionnaires were distributed and one hundred eighteen were returned and analyzed. Factor analysis and structural equation model using AMOS 16.0 software are employed to the dataset. The result of this study identifies that there are eight dimensions of organizational service culture in the public sector service organizations, name ly: 1 relationship employee’s - customer, 2 employee’s competency, 3 benefit and salary, 4 work pressure, 5 mindset service and transferability, 6 preference of employee’s, 7 respect, and 8 feeling proud and honored. The result of the structural equation model concludes that service culture indeed influence service innovation and the last service innovation are influence organizational performance. Service innovation has a mediating role between service culture and organizational performance. This study contributed new finding regarding the construct of service culture specifically in the case of Public Sector Services Company. In addition, this study also contributes to the development of structural model between variables service culture, service innovation, and organizational performance. Keywords : Service culture, Service innovation, Organizational performance, Public sector 1 ICoMS 2015

1. INTRODUCTION

Traditionally, public sector organization is government agencies most often face problems in terms of service. Low image of public institutions in the public perseption is clear evidence of poor public services in Indonesia. Although the report states that the World Economic Forums competitiveness Indonesian economy rose four levels in 2014 with ranks 34 out of 144 countries The Global Competitiveness ReportGCR still can not be denied that the Indonesian public agencies still face many problems, mainly related to the characteristics of the system in the public sector are rigid, convoluted, and tend to the status-quo. Public sector organizations need to make a breakthrough to address congestion and deadlock organizations in the public sector. Rigid system of government bureaucracy, convoluted, and tend to the status-quo in public organizations are only able to be disbursed through the emphasis on service culture. Service culture must be built and developed better. Service culture created if the organization puts service as the core of organizational culture Lytle et al., 1998; Homburg et al., 2002; Lytle dan Timmerman, 2006. Service culture can be identified through the attitudes and behavior of employees in the organization, because culture is a code of conduct in the organization. Service culture will foster identity from each employee to their work because of the similarity values embedded will allow every employee to understand and appreciate each activity performed in daily work. Organizations that have a high level of service culture will be seen from the attitude and behavior of employees who uphold the excellent service delivery to customers. Instead, the public perception of the culture of public service organizations in Indonesia tends to be low or even worse. One factor that became a benchmark in assessing the public good or bad performance of public organizations is the performance of the frontline employee’s. Studies show that employee attitudes and behavior can influence consumer perceptions of the experiences of The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia | 183 service companies Bitner, Booms, and Mohr, 1994. Basically, manage contacts between employees and customers in service activities involving administrative mechanisms brought by employees of the results of the companys service culture. Employee behavior will be different in each organization depending on their cultural background. Service culture play an important role as the organizations identity. Attitudes and behavior of employees is a reflection of the culture of service instilled by the organization. Therefore, the service culture is believed to have significant influence in shaping the performance of the service employees in public institutions in Indonesia. Although there is urgency in investigating the factors that affect the service culture within the organization, particularly in the public sector, but not many studies have attempted to investigate. By doing a synthesis of previous research, this study is expected to provide a new measurement scheme that evaluates the service culture of public sector organizations. In addition, this study also aims to investigate the relationship between the service culture to service innovation and organizational performance in public institutions in the City of Bengkulu. 2. LITERATURE REVIEW 2.1 Service Culture Service culture is very important to create an organization that focused to the customer and considered as a source of competitive advantage to the company Hallowell et al., 2002. Before we talk about service culture, we need to understand about organizational culture. Service culture constitute values and norms that derived by the organizational culture. In general, the concept of organizational culture is used to describe the norms and values agreed together upon by members of the organization. According to Grönroos 2000, culture is a concept that explains why people do certain actions, think the same way, appreciate the same goals, the same routine, and even share the same jokes because they are members of the same organization. There are many definitions of organizational culture that has been created by experts Beyer and Trice, 1987; Thompson and Wildavsky, 1986, but in general, organizational culture is defined as a pattern of beliefs and values agreed together that gives meaning to the members of the organization and the rules of conduct in organization Davis, 1985, Deshpande and Webster, 1989. In simple language, organizational culture can be referred to as the way we do things in the organization. Organizational culture reflects the values inherent in the organization. Organizational culture is not always clearly visible, but organizational culture can be perceived. Organizational culture can also be seen as an internal climate of the organization. Grönroos 2000 concluded that the organizational climate depends in part on how the internal relations between employees in an organization to function. Employee perceptions of organizational climate are about what is important in the organization Schneider and Bowen, 1995. This perception arises because employees are given goals to be achieved in their work and how the exercises are done in the organization. Therefore, service providers must manage the internal climate of the company so that internal consumer can serve external customer well and can develop a positive attitude towards the provision of services. Attitude towards service delivery can develop if the employee feels that the internal routines, guidance for action, and reward systems indicate that focus on good service is important. Service culture or a culture of service is defined as a business that puts service as a core organizational culture Curtis and Upchurch, 2008; Teare, 1993. The views are almost same was conveyed by Grönroos 2000 which defines the service culture as a culture where respect for good service grows, and the provision of services to internal and external customers is considered as a way of life and is considered as one of the norms of the most important for everyone. According to Zeithaml et al. 2009, this definition has implications on the behavior of employees. First, the culture of the service will be there if there is an appreciation for good service. This expression does not mean that the service provider has an advertising campaign that emphasizes the importance of the service, but people know that services are well appreciated and assessed . The second point of this definition confirms that the service is provided to internal and external customers. Promising excellent service to external customers is considered not enough. Everyone in the organization deserves the high quality of services. Employees who are satisfied with the internal services will be more likely to be able to meet and satisfy the needs of external customers . Finally, in a culture of service, good service is the way of life of all people and it is natural for a good service is an important norm in the organization.

2.2 Service Innovation Service delivery refers to the actual delivery of services

Zeithalm et al ., 1988 and the delivery of product and services to the customer Lovelock dan Wright, 2002. Service delivery more focused on Where, When, and How the services is delivered to the customer and whether this service having low, medium, or high contact with frontline. Innovation is defined as the delivery of services to produce, receive, and implement processes, products, or services for the first time in the organization Thompson, 1965. Therefore, innovation in service delivery can be considered as a new mechanism of delivery service that offers convenience for customers Lovelock and Wright, 2002 and improve the competitiveness position of the The 2015 International Conference of Management Sciences ICoMS 2015, April 23, UMY, Indonesia | 184 company. Despite the importance the innovation of service delivery made by the company, but academic research investigating this case is still relatively limited. More research is needed to investigating the relationship between service cultures toward service delivery innovation. Organization that has a strong culture is believed to be able to adapt to environmental changes. Anticipation of changes in a highly dynamic environment conducted with service delivery innovation.

2.3 Organizational Performance