A Case Study on Impact of Work Culture on Organizational Performance

Dr. Jyotsana Khandelwal
(Assistant Professor- Jaipur National University, Jaipur)
Ms. Kamini Rajotia
(Research Scholar-Jaipur National University, Jaipur)

The main aim of research article is to identify and measure strong relationship between performance and organizational culture. Today’s organization is predominantly dynamic that pose enormous opportunities and challenges to the corporate practitioners and policy makers. Understanding such dynamism is very crucial to pursue the organizational strategic objectives. The primary aim of this paper is to examine the impact of work culture on employee performance from the perspectives of multinational companies. Methodology: Literature review is adopted as methodology to assess the culture of an organization impacts upon process, employees and systems. The paper has applied qualitative methodology focusing on the argument that work culture significantly influences employee performance and productivity in the dynamic emerging context.

Keywords: corporate practitioners, culture, performance, productivity.

1.    Introduction
The different attributes of culture have been arranged on basis of norms and attitudes which help in differentiating one firm from another. (Forehand ad von Gilmer, 1964) The process of thinking helps in establishing one member from another on basis of cognitive thinking (Hofstede, 1980). The success guidance based upon different values and norm that makes culture effective (Schein, 1990). The set of beliefs, behaviours, norms and values helps in making culture most effective (Kotter and Heskett, 1992). The knowledge of culture has been gained through understanding and beliefs on basis of large groups.
Culture is defined as a mixture of values, sets, beliefs, communications and explanation of behaviour that provides guidance to people. The main idea of culture comes from sharing in learning processes that have been based upon systematic allocation of resources. (Titiev, 1959) The cognitive systems of human that helps in improving thinking and decision making were based upon organization culture. (Pettigrew 1979) The multifaceted set of beliefs, assumptions and values helps in presenting different level of culture by conducting business at an effective manner. The normative glue based upon organization culture helps in holding overall management effectiveness ( Tichy 1982). The concept of effective organization culture helps in improving business decisions. The survival of culture in an organization lies upon national and foreign culture differentiation in culture management. (Schein, 1990) The culture of organization has been affected by attitudes, norms and beliefs that lead to strong communication between employees. Now a day’s organization culture has generally been interrelated to management. (Kotter and Heskett, 1992).The two essential factors that lead to effective culture management include structural stability and integration of superior standard of organization culture. (Schein, 1995) Certain characteristics of organization culture have been established in which set of norms, values and beliefs helps in perfect association between them.(Hodgetts and Luthans, 2003) At different level of organization culture different background, ethics and racial differences impact upon performance. The similar organization culture with different backgrounds has common set of values and beliefs to be effected by organization systems. (Robbins & Sanghi, 2007) The attraction of organization norms, values and beliefs have strong affect upon performance and sustainability. (Stewart, 2010) Theorems of employees impact upon sustainable performance and management of organization culture as it leads to attainment of profitability.

2.    Literature Review
Organizational culture is conceptualized as shared beliefs and values within the organization that helps to shape the behavior patterns of employees (Kotter and Heskett, 1992). Gordon and Cummins (1979) define organizational culture as the drive that recognizes the efforts and contributions of the organizational members and provides holistic understanding of what and how is to be achieved, how goals are interrelated, and how each employee could attain goals. Hosftede (1980: 25) summarizes organization culture as collective process of the mind that differentiates the members of one group from the other one. Thus the above concept asserts that organizational culture could be the means of keeping employees in line and exhilarating them towards organizational objectives. Early organization behavior researchers (Peters and Waterman, 1982; Deal and Kennedy, 1982; and Pascale and Athos, 1981) find the unambiguous links between culture and organizational performance. These cultural values are consistent with organizational chosen strategies that led to successful organizations. Although the relationships between organizational culture and employee performance have been widely accepted, some researchers (Willmott, 1993; Legge, 1994; and Ogbonna, 1993) raise concerns about the relations. Thus Gordon and DiTomaso (1992) and Denison (1990) argue that culture characteristics might affect performance but restricted or conditioned to the specific context. They further argue that culture may lead to higher performance if it fits with changes of environmental factors within the context. Recently, researchers argue that cultural traits cannot be copied and therefore it could be source of organizational sustainability. Resource-based view (Barney, 1986 and 1991) suggests that sustainability depends on the values, rarity and sustainability of the culture concerned. Overall, the aim of the literature review is to examine the existing research to explore the links between culture and performance.
Due to the subjective nature of culture, it could be challenging to precisely define the specifications of organizational culture. Despite no single theory is uniformly accepted, there is a general consent about organizational culture on being traditionally determined and socially structured that involves beliefs, behaviors, values and morals allied with different levels of the organization and incorporates to all aspects of organizational life (Pettigrew, 1990 and Hofstede, Neuijen, Ohauv and Sanders, 1990). The organizational culture is outlined by Schein (1990) as overall phenomenon of the organization suchas natural settings, the rite and rituals, climate and values of the company. According to Martins and Terblanche(2003), culture is deeply associated with values and beliefs shared by personnel in an organization. Organizational culture relates the employees to organization’s values, norms, stories, beliefs and principles and incorporates these assumptions into them as activity and behavioral set of standards. Klein et al. (1995) positioned organizational culture as the core of organization’s activities which has aggregate impact on its overall effectiveness and the quality of its products and services. Schein (2004) defined organizational culture as a dynamic force within the organization which is revolving, engaging and interactive and it shaped up by the employees and managements gestures, behaviors and attitudes. Eariler scholars (Rossman, Corbett and Firestone, 1988; Schwartz and Davis, 1981; Cooke and Rousseau, 1988; Gordon and Di Tomaso, 1992; Schall, 1983; Schein, 1992; Rousseau, 1990) have explained culture as mutual experience which depends on the behavioral and societal activities.
Performance on the other hand refers to be the ability (both physical & psychological) to execute a specific task in a specific manner that can be measured as high, mediumor low in scale. The word ‘performance’ can be used to describe different aspects such as societal performance, organizational performance, employee performance, and individual performance etc. Researchers (Roe, 1999; Campbell, McCloy, Oppler, & Sager, 1993; Campbell, 1990; Kanfer, 1990) tend to identify two dimensions of performance: an action dimension (i.e. behavioral aspect) and an outcome dimension (i.e. performance aspect). Here, the behavioral aspect of performance is assumed to be matched with work situation and job specifications. Then this selective behavioral aspect turns into a means of achieving organizational goals and objectives that is the outcome dimension or performance aspect. Although there is a range of behaviors that could be used for measuring performance, Motowidlo, Borman, & Schmit (1997) emphasize judgmental and evaluative processes that take a great deal along with action itself while defining performance.

A strong organizational culture supports adaptation and develops organization’s employee performance by motivating employees toward a shared goal and objective; and finally shaping and channeling employees’ behavior to that specific direction should be at the top of operational and functional strategies (Daft, 2010). A firm’s mission reflects its ultimate long term objective which is accomplished by conducting integrated operational and behavioral activities. A firm’s performance improves if it has a clear sense of purpose and commitment towards its mission. Successful and well performed organization defines its organizational goals as the report card of forthcoming (long term) future (Ohmae, 1982; Mintzberg, 1987; Hamel and Prahalad, 1994). Along with others, shared value of employees is one of the basic components of organizational culture (Smitand Cronje, 1992; Hellreigel et al., 1998). Schein (1994) clarifies that value which is a set of social norms that define the rules or framework for social interaction and communication behaviors of society’s members, is a reflection
of causal cultural assumptions. Individuals who hold similar values may feel and interpret situations and events similarly (Meglino, Ravlin, & Adkins, 1989) which can reduce uncertainty (Schein, 1985), role ambiguity, and conflict (Fisher and Gitelson, 1983), allow for the accurate prediction of other’s behavior (Kluckhohn, 1951), and make successful interpersonal interactions more likely (Meglino et al. 1989). Academics and practitioners argue that the performance of an organization is dependent on the degree to which the values of the culture are widely shared (Peters and Waterman, 1982; Deal and Kennedy, 1982; Denison, 1990; Ouchi, 1981; Pascale and Athos, 1981 and Kotter and Heskett, 1992). Similarly, it is widely argued that shared and strongly held values enable management to predict employee reactions to certain strategic options and by reducing these values, the consequences maybe undesirable (Ogbonna, 1993)

3.    Linkage of Organizational culture with Organizational performance

Denison (1984) studied 34 Americans cultural performance on basis of characteristics that helps in improving performance over time. The culture and performance have been interrelated to each other based upon perfect association between business processes (Reichers and Schneider, 1990). The culture construct based upon operational complexity have its basis towards different business processes. In more than 200 organizations economic and long term performance has been investigated (Kotter and Heskett, 1992). Several researches have been made to evaluate performance of organization based upon efforts as culture has been given significant association.

The three contributions on culture defined were as follows:
Oval: Power Distance 


Oval: Masculinity


Oval: Individualism

Oval: Uncertainty


Organizational Culture

Power distance:
It is defined as the degree of employee and management behavior that is based upon a perfect relationship between formal and informal set of planning action.
In this dimension difference between organization interest and self interest have perfectly been matched.
Uncertainty avoidance:
The uncertainty and ambiguity based upon tolerance helps in mitigating willingness of people.
It comes in avoidance of caring and promotion rather than level of success based upon challenges, insolence and ambition.

Organizational Performance
The degree of an achievement to which an employee’s fulfill the organizational mission at workplace is called performance (Cascio, 2006). Performance has been perceived differently by various researchers, but most of the scholars relate performance with measurement of transactional efficiency and effectiveness towards organizational goals (Stannack, 1996; Barne, 1991).  The job of an employee is build up by degree of achievement of a particular target or mission that defines boundaries of performance (Cascio, 2006). Certain researchers have identified different thought, attitudes and beliefs of performance as it helps in measurement of input and output efficiency measures that lead to transactional association. (Stannack, 1996) The capability of an organization to establish perfect relationship with resources presents effective and efficient management of resources. (Daft, 2000) In order to achieve goals and objectives of organization strategies have been designed based upon organizational performance. (Richardo, 2001) The equity based upon high returns helps in effective management of organization resources so that performance improves. (Ricardo, 2001)

4.    Discussion
Firstly culture and performance were considered interrelated to each other by forceful management. Secondly nature and scope of culture based upon theoretical point of view have been presented more appropriately. While strong association between management practices, performance and culture management have been presented so that culture establishment takes place effectively.

 The competitive advantage of an organization is attained through strong association and establishment of culture. The organization culture helps in measuring limitation to overcome performance measurement.( Rousseau 1990) The limitations shows that culture and employee performance shows negative correlation as employee performance is badly affected by it.

The methodologies and findings of researches shows that culture and performance were considered interrelated. (Lim, 1995) The sustainable competitive advantage of organizational competencies has been related to superior and imitable relationship with competitors (SaaPe’re and Garcia-Falcon, 2002). The value of culture based upon degree of performance has been managed with practitioners and academics. (Denison, 1990)


The different values and beliefs based upon employee performance helps in organization association. The organization culture helps in internalizing joint relationship that leads to manage effective organization processes. The productivity and culture of organization helps in improving performance. In more than 60 research studies 7600 small business units and companies’ performance from 1999 to 2007 have been evaluated. The positive association between culture and performance helps in improving results of organization. The job performance of organization has a strong impact of strong organization culture as it leads to enhance productivity. The paper demonstrated that numerous attributes of organizational culture have significant positive influence over the performance of organization. The paper has mapped out different cultural aspects of organizations as well as showed the vital relationship between culture and performance. The qualitative research facilitated the paper with its robust and in-depth observations. The norms and values of organization based upon different cultures influence on work force management. In an organization strong culture enables to effective and efficient management of work force employees. The net profit in an organization helps in enhancing performance of employees. The common path for making perfect use of resources in same cultural association helps in positive development of organization. On basis of particular conditions organizational culture is helpful in improving and providing competitive edge. The employee commitment and group efficiency helps in improving performance based upon organization sustainability. The nature and power of organization culture influence upon sustainability and effectiveness of organization.


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