Professional Documents
Culture Documents
Organisational Culture and Employee Performance
Organisational Culture and Employee Performance
Research Background
Many business managers that love reading would definitely know about some of the famous
and bestselling business books such as In Search of Excellence by Peters & Waterman (1988)
or Built to Last: Successful Habits Of Visionary Companies authored by Collins & Porras
(1994). Reading these best-selling business management books would likely convince the
reader about the importance of corporate culture or organisational culture in affecting firm
performance or business success. In other words, the key theme of these popular books is that
organisational culture is the determinant of corporate success and effectiveness.
From the academic point of view as well, there are many arguments and theories as well on
how organisational culture may affect firm performance or the possibility to attain
competitive advantage within a competitive industry (Akdere & Schmidt, 2007; Baird,
Harrison & Reeve, 2007; Freiling & Fichtner, 2010; Gardner, 1999; Levin, 2000). In a way, it
can be understood that organisational culture is a very important construct to be studied or
managed properly, as to contribute to better organisational performance.
Within such a context, one of the areas within the context of organisational culture is about
how organisational culture may affect employee performance. Some of the previous studies
available on examining about the relationships between organisational cultures to employee
performance include the following: Paarlberg (2007), Uddin, Luva & Hossian (2013) and
Tziner, Shultz & Fisher (2008).
While there are indeed some studies available that indicates the importance or impact of
organisational culture on employee performance, there is however none of such studies
available within the context of China. In other words, the impacts or possible influence of
organisation culture towards employee performance within organisations in China is
unknown. Such gap in the literature will be addressed in this essay.
Overall, it can be seen that there are many different definitions or varieties of definitions on
organisational culture within the literature. However, it can be seen that these definitions
indeed shared similar connotation or theme. For that, organisational culture is often regarded
as something that is about:
Scholars Dimensions
Aggressiveness
Attention to details
Innovation
Stability
Team orientation
Communication
Innovation
Social cohesion
Trust
Competitiveness
Emphasis on rewards
Innovation
Social responsibility
Stability
Supportiveness
Overall, the discussion above shows that organisation culture can be investigated and
analysed from many different dimensions. In other words, organisation culture is a multi-
dimensional construct. With that understanding, it is crucial to research organisational culture
from multiple dimensions, for better accuracy of research findings. For that, as will be later
discussed further, the framework of organisation culture as developed by O’Reilly, Chatman
& Caldwell (1991) will be employed. Such framework is also known widely as the
Organisational Culture Profile. As shown in Table 2 above, such a model postulates that
organisation culture can be divided into these dimensions: aggressiveness; attention to
details; innovation; outcome orientation; respect for people; stability; and team orientation.
Overall, as can be seen from the discussion presented above, it can be understood that
organisation culture is indeed an important component or determinant of organisational
outcomes. It is crucial as it will not only affect the financial performance of a firm, but also
the non-financial performance of a firm, such as on issues related to: growth, innovation,
learning, motivation, employee commitment, employee satisfaction, and sustainability of a
firm. However, it is also noted that not all sort of organisation culture may affect firm
performance or outcomes positively. In other words, some culture may contribute to firm
performance while some other culture may not. To better understand about such issue, a
review of the different types of organisational culture will be carried out in the subsequent
section.
Types of Organisation Culture
It is unavoidable that different organisations have different organisation culture, as there are
virtually too many different ways on how the different shared behaviours, assumptions,
routines, belief and norms affect the people within an organisation. For that, scholars had
tried to investigate and characterise the different types of organisation cultures available.
Through understanding how the different organisation culture may affect different firms
differently, it is possible to better understand how the different culture may exert different
impacts on an organisation. To better review on the types of organisation culture as discussed
by scholars, the models or theories developed by the different scholars in characterising the
types of organisational culture will be presented in Table 3 below.
Bet-the-company culture
Power culture
Role culture
Harrison & Stokes (1992)
Achievement culture
Support culture
Bureaucratic culture
Chung-Ming, Tse & Zhou
Clan culture
(2002)
Entrepreneurial culture
Market culture
Power culture
People culture
Sharimllah, Siong & Ismail
Clan culture
(2011)
Adhocracy culture
Hierarchical culture
Market culture
From the information presented above, it can be seen that there are indeed many different
types of organisation culture, albeit the different scholars may employed or developed
different models or frameworks in their respective research into organisation culture. For that,
one of the common or widely accepted ways to better analysed the types of organisation
culture available is the instrument of Organisational Culture Profile as developed by
O’Reilly, Chatman & Caldwell (1991). As will be discussed later in the subsequent section,
such instrument is useful in characterising the corporate culture of an organisation – of which
it will offer insights to researchers or even practitioners on the types of organisation culture
available within a firm. The instrument will be employed within this dissertation, in order to
research into the organisation culture of China Coal Energy Pte Ltd. The discussions
pertaining to such instrument will be presented below.
The very initial reason for the development of Organisational Culture Profile (OCP) by
O’Reilly, Chatman & Caldwell (1991) in order to examine if a particular employee can fit
well within certain organisation culture; as it is believed that the person-organisation fit is
crucial in affecting the performance of an employee. This is because every individual has
their respective values and belief system, and that will affect their interaction with the others
in a group, team or organisation. For that, it is important that the personal value of an
employee fit the organisation value of an organisation, of which the organisation’s value is
one of the core elements that affect or constitute the organisation culture (O’Reilly, Chatman
& Caldwell, 1991). Concerning such, a review of the model of Organisational Cultural
Profile (OCP) will be further provided in the next paragraphs.
Under the model of Organisation Cultural Profile (OCP), it is postulated that organisational
culture can be characterised using a total of seven dimensions, of which such notion had been
discussed earlier; that organisation culture is a multi-dimensional construct. To explain, under
the model of Organisation Cultural Profile (OCP), the seven dimensions of organisational
culture include the following: (i) aggressiveness, (ii) attention to details, (iii) innovation, (iv)
outcome orientation, (v) respect for people, (vi) stability, and (vii) team orientation. Under
such a model, the organisation culture of a particular company can be accessed or gauged by
examining about the scores of the each and every dimensions of organisational culture as
outlined above. It is from such a score that the organisational culture of the company can be
measured, or even to be compared to the organisational culture of other companies.
Then, under each of these dimensions, various items were developed to access the score
achieved by a company on that particular dimension. In the model, these various items were
actually the respective organisational values that describe a particular dimension of
organisational culture (O’Reilly, Chatman & Caldwell, 1991). As shown in Table 5 below,
the seven cultural dimensions as postulated under Organisation Cultural Profile (OCP), as
well as the various organisation values that characterise or describe each of these dimension
are presented.
Aggressiveness Ø Competitive
Ø Socially responsible
Ø Precise
Ø Attention to detail
Ø Innovation
Ø Opportunities
Ø Experimenting
Innovation
Ø Risk taking
Ø Careful
Ø Rule oriented
Ø Achievement oriented
Ø Action oriented
Outcome orientation
Ø High expectations
Ø Result oriented
Ø Respect for individuals
Ø Tolerance
Ø Stability
Ø Predictability
Stability
Ø Security
Ø People oriented
There are some studies being conducted based on the use of Organisational Culture Profile
(OCP). To better understand how the other scholars or researchers had employed the tool of
Organisational Culture Profile (OCP), a review of those previous studies that had employed
such instrument will be reviewed and then discussed. These studies will be presented
accordingly in Table 4 below.
Scholars Discussions
A study was conducted via the use of both OCP instrument and the
model of Big 5 Personality. It is found that job seekers indeed do
Judge & Cable (1997)
consider about the organisation values of the organisation, when
considering about the jobs offer.
A study was conducted to examine about the impact of person-
organisation fit may affect the employee turnover situations. Based
Vandenberghe (1999)
on the instrument of OCP, it is found that congruency of person-
organisation fit can reduce employee turnover rate.
The organisational culture of accounting firms in French were
Christian & François examined (through the use of OCP), It is found that these firms
(2005) score highly on these cultural dimensions: (i) innovation, (ii)
respect for humans, (iii) results orientation, and (iv) stability.
The researcher had employed OCP within the study of how person-
Castiglia (2006)
organisation fit may affect the conditions of employees. It is found
that better person-organisation fit can affect job satisfaction and
commitment.
Through the use of OCP in surveying about the importance of
person-organisation fit. Through such study, it is found that when
Hillary & O’Reilly
an employee fit the organisational culture, the particular employee
(2007)
would tend to have better outcomes (such as: satisfaction,
commitment, and engagement).
OCP was employed to characterise the organisational culture of
Australian companies. From the OCP model, it is found that many
Baird, Harrison & Reeve
of the Australian companies can be characterised by two
(2007)
dimensions, namely: (i) outcome orientation as well as (ii) respect
for people.
Borg, Groenen, Jehn, The validity and reliability of OCP was examined. The usefulness
Bilsky & Schwartz of OCP was ascertained. The model is found to be feasible to
(2009) support the research into issue such as person-organisation fit.
The impact of organisational culture towards the effectiveness of
Total Quality Management (TQM) implementation was examined.
Through the use of OCP, it is found that firms that score highly on
Baird, Kristal & Reeve
certain cultural dimensions, such as: (i) innovative, (ii) outcome
(2011)
orientation, (iii) respect for people, and (iv) teamwork; tend to be
more successful in the adoption and implementation of Total
Quality Management (TQM).
The impact of organisational culture (through the use of OCP
instrument) towards affecting the performance appraisal process
within higher educational institution was examined. It is found that
Teh, Boerhannoeddin & organisational culture indeed does have significant effects on the
Ismail (2012) performance appraisal process. Aside from that, the validity of the
OCP instrument is examined. It is found that it is indeed a valid
instrument to be used reliably in investigating or describing the
culture of even an educational entity.
Overall, the previous studies by other researchers or academic scholars found the following:
OCP is a valid and reliable tool or instrument to be used in research concerning study
into organisational culture. Specifically, OCP can be used to examine about the
organisational culture of a firm.
There are evidences supporting the importance of person-organisation fit.
There are evidences that organisational culture can affect outcomes of a company,
such may include the performance of employees, or even the execution of certain
management practices such as Total Quality Management (TQM).
From such findings, it is therefore reasonable to argue that the instrument of Organisational
Cultural Profile (OCP) is a valid tool to be used within the conduct of research in this
dissertation – given that many of the academic studies available had offer support towards the
validity and reliability of such a tool in characterising or explaining the organisational culture
of a particular organisation. With that, such a tool is indeed relevant and suitable for the
conduct of this particular research; and the selection of such instrument in the examination of
organisational culture of China Coal Energy Pte Ltd. is appropriate and sensible.
Employee Performance
In the first part of the literature review, intensive review on materials related to organisational
culture, specifically focusing on the instrument or research related to Organisational Cultural
Profile (OCP) was performed. In the second part of this chapter, the focus is however on the
construct of employee performance, given that the construct of employee performance is yet
another important issue examined or researched within this study.
Overall, the discussion presented above indicates the nature of employee as multi-
dimensional construct. For that, the issue concerning employee performance within this
dissertation will also be examined from multiple dimensions. Nevertheless, a review on how
some factors may affect employee performance will be reviewed as well, in the next section.
This is critical as aside from organisational culture, there are many other factors that may
affect employee performance. Such discussion will be presented accordingly below.
· Baptiste (2008)
· Biswas (2011)
Employee motivation · Cheng & Kalleberg (1996)
· Endres & Mancheno-Smoak (2008)
· Anitha (2014)
· Topper (2007)
Interaction with supervisor
· Orpen (1995)
· Houger (2006)
Workplace Workplace spirituality · Osman-Gani, Hashim & Yusof (2013)
factors
· Fachrunnisa, Adhiatma & Mutaminah
(2014)
Workplace bullying · Devonish (2013)
· Pearce & Randel (2004)
· Evbuoma (2008)
· Kowalewski & Phillips (2012)
· Mochama (2013)
Compensation and reward
· Njanja, Maina, Kibet & Njagi (2013)
· Daniel (2010)
Human Resources
· Uysal (2014)
Management Practices
· Mishra & Sarkar (2013)
Overall, the intensive review on how other factors may affect employee performance had
found that it is indeed complicated on how different factors may affect employee
performance. These different factors can be however be categorised into these dimensions,
such as: individual characteristics or related factors, job related factors, supervisor related
factors or even workplace factors. Having such understandings is indeed crucial to put the
research carried out within this dissertation into better perspective, as organisational culture is
one of the many critical factors that can affect employee performance. Nevertheless, to
survey deeper into how organisational culture may affect employee performance, a review on
the empirical evidences available on how organisational culture can affect employee
performance will be presented accordingly in the subsequent section. This is crucial as both
‘organisational culture’ and ‘employee performance’ are crucial constructs being examined
within this dissertation.
First of all, in the study carried out by Paarlberg (2007), the impacts of customer orientation
culture towards employee performance, within governmental bodies were investigated.
Through the use of both quantitative and qualitative methods, with research participants as
the civilian employees at a Department of Defence; it is found that a workplace culture of
customer service orientation has a strong positive impact on employee performance and
motivation.
Then, in the research performed by Uddin, Luva & Hossian (2013), the effects of
organisational culture on employee performance and productivity; based on a case study of
telecommunication sector in Bangladesh was investigated. The company selected within the
case study is Grameenphone (GP), which is actually a subsidiary of Teleron in Norway. From
the research, it is found that organisational culture indeed exerts significantly influences
towards employee performance and productivity in the country.
Yet, in the research performed by Tziner, Shultz & Fisher (2008), the effects of
organisational culture towards issues such as leader-member exchange and organisational
justice, and then how both leader-member exchange and organisational justice may affect
employee performance was examined. From that research, it is found that two dimensions of
organisational culture, namely: employee supportiveness and attention to detail, would affect
both leader-member exchange and organizational justice; and those two issues in turn
indirectly affect employee performance.
From such review of the relevant studies on effects from organisational culture on employee
performance, it can be seen that evidences available support the impact of organisational
culture on employee performance. Nevertheless, such notion will be further examined within
this dissertation.
Summary
Overall, this essay had reviewed about the relevant literature on both ‘organisational culture’
and ‘employee performance’. From the intensive review on the two constructs, it is found that
both organisational culture and employee performance are crucial issues in the context of
modern business management. Then, both the construct are multi-dimensionality in nature. In
other words, both organisational culture and employee performance can be and indeed shall
be studied from multiple dimensions. Other than that, it is also discussed that different
organisations have different cultures; i.e., there are many types of organisational cultures.
Theoretically, different types of organisational culture would affect employee or
organisational outcomes differently. One of the common instrument or tool used by scholars
in the study on organisational culture is “Organisational Culture Profile (OCP)”. Under such
a tool, the various dimensions of organisational culture within an organisation were
examined. The scores on each of these dimensions of organisational culture, as achieved by a
particular organisation; will be used to explain and describe the culture available within an
organisation.
Yet from another perspective, it is also discussed that organisational culture is not the only
factor that may affect employee performance. In other words, many other different factors
may affect employee performance. These different factors can be categorised into these
dimensions, such as: individual characteristics or related factors, job related factors,
supervisor related factors or even workplace factors. Last but not least, a review of the
relevant studies in the past on relationships or effects from organisational culture on
employee performance was carried out and examined. It is found that evidences available
support the notion that there are impacts of organisational culture on employee performance;
or that both organisation culture and employee performance are related.
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