International Journal of Management (IJM)

Volume 11, Issue 10, October 2020, pp. 2408-2414. Article ID: IJM_11_10_237
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ISSN Print: 0976-6502 and ISSN Online: 0976-6510

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A STUDY ON THE IMPACT OF

ORGANIZATIONAL CULTURE ON THE
EFFECTIVENESS OF PERFORMANCE
MANAGEMENT SYSTEMS IN HEALTHCARE
ORGANIZATIONS AT THANJAVUR
D. Vidya
Research Scholar, PG & Research Department of Management,
Marudupandiyar College, (Affiliated to Bharathidasan University, Tiruchirappalli),
Thanjavur, Tamil Nadu, India.

Dr. P. Kothai
PG & Research Department of Management,
Marudupandiyar College, (Affiliated to Bharathidasan University, Tiruchirappalli),
Thanjavur, Tamil Nadu, India.

ABSTRACT
The main objective of this study is to analyze the impact of aspects of Organizational
Culture on the Effectiveness of the Performance Management System (PMS) in the
Health Care Organization at Thanjavur. Organizational Culture and PMS play a
crucial role in present-day organizations in achieving their objectives. PMS needs
employees’ cooperation to achieve its intended objectives. Employees' cooperation
depends upon the organization’s culture. The present study uses exploratory research
to examine the relationship between the Organization's culture and the Effectiveness of
the Performance Management System. The study uses a Structured Questionnaire to
collect the primary data. For this study, Thirty-six non-clinical employees were selected
from twelve randomly selected Health Care organizations at Thanjavur. Thirty-two fully
completed questionnaires were received.
Key words: Organizational Culture, Performance Management System.
Cite this Article: D. Vidya and P. Kothai, A Study on the Impact of Organizational
Culture on the Effectiveness of Performance Management Systems in Healthcare
Organizations at Thanjavur, International Journal of Management (IJM), 11(10), 2020,
pp. 2408-2414.
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 A Study on the Impact of Organizational Culture on the Effectiveness of Performance Management
Systems in Healthcare Organizations at Thanjavur

1. INTRODUCTION
Recent literature proved that Human Resources Management in an organization has become
significantly important for achieving its business vision. Employees were considered invaluable
assets to an organization, requiring effective management of these employees in firms. The
organizational culture determines employees' behavior in the organization and it is represented
in the shared values, beliefs, and attitudes of organizational employees. Organizational culture
includes the organization's vision, norms, values, experiences, philosophy, systems, symbols,
language, and habits. This Organizational culture is expressed in employees’ attitudes,
interaction with the external environment, and how people and groups interact with each other.
The main goal of the performance management system is to align organizational objectives
with individual objectives. (Armstrong 2015). The effective implementation of PMS
necessitates a favorable organizational culture. The present study will shed light, assess the
practice of PMS, and analyze if there is any relationship between organizational culture and the
effectiveness of PMS. This paper deals with the impact of this Organizational culture on the
Effectiveness Performance Management System in the Healthcare Organization at Thanjavur.

2. LITERATURE REVIEW
Herman Aguinis (2019) stated in his book titled Performance Management for Dummies, ‘In
some organizations, the culture is highly competitive, and there is a win-lose mentality such
that employees know that to succeed and receive the rewards they want, they need to be
concerned about themselves first and others last. In those organizations, it is unlikely that the
PMS will include measures of contextual performance such as competencies regarding co-
operations and working with others.
Rameshwar Dubey et al (2017) “Organizational culture (i.e. flexible orientation and
control orientation) plays a different role on the differential effect of coercive pressures,
normative pressures, and mimetic pressures on shaping PMs for sustainability benchmarking.
Mannion, R., & Davies, H. (2018) Hospitals, are a dynamic cultural mosaic made up of
multiple, complex and overlapping subgroups with variably shared assumptions, values,
beliefs, and behaviors. Two of the major professional groupings concerned with quality
improvement -doctors- managers- may differ in several important ways. For example, Doctors
may focus on patients as individuals rather than as groups. Managers may be more concerned
with patients as groups and value a social science-based experiential perspective.
Armstrong and Baron, (1998) “Performance management is a strategic and integrated
approach to delivering sustained success to organizations by improving the performance of the
people who work in them
and by developing the capabilities of teams and individual contributors”.
Kandula, (2006) The purpose of performance management is to transform the raw potential
of human resources into performance by removing intermediate barriers as well as motivating
and rejuvenating the human resource.
According to Kandula (2006), the key to good performance is a strong culture. He further
maintains that due to differences in organizational culture, the same strategies do not yield the
same results for two organizations in the same industry and the same location. A positive and
strong culture can make an average individual perform and achieve brilliantly whereas a
negative and weak culture may demotivate an outstanding employee to underperform and end
up with no achievement. Therefore, organizational culture has an active and direct role in
performance management.

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 D. Vidya and P. Kothai

3. OBJECTIVES OF STUDY
• To examine the aspects of organizational culture.
• To find the aspects of the effectiveness of PMS.
• To find out the Impact of organizational culture on the effectiveness of the performance
management system.

4. METHODOLOGY
A well-structured questionnaire was used to collect primary data, secondary data has also been
collected from articles and the internet, etc., Correlation and Regression analyses were applied
for this study.

4.1. Conceptual Framework

The study is mainly aimed to investigate the impact of organizational culture on the
effectiveness of Performance management systems. From the extensive literature survey, the
various aspects of organizational culture were taken into analysis, which is divided into three
aspects, culture related to organization, related to work culture, and related to work values.
Seven aspects of the effectiveness of the Performance management system were also
considered.

Figure 1

5. ANALYSIS OF DATA
5.1. Correlation Analysis

HYPOTHESIS
H0: Organizational Culture has no significant impact on the effectiveness of the performance
management system in healthcare organizations at Thanjavur.
H1: Organizational Culture has a significant impact on the effectiveness of the performance
management system in healthcare organizations at Thanjavur.

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 A Study on the Impact of Organizational Culture on the Effectiveness of Performance Management
Systems in Healthcare Organizations at Thanjavur

Table 1 Pearson Correlation Coefficient between factors of Organizational Culture and the
Effectiveness of the Performance Management System in healthcare organization at Thanjavur
Factors of
Performance
Impact of Organizational Culture Organizational Work Work
Management
on the Effectiveness of the Culture Culture Values
System
Performance Management System
Organizational Pearson
1 .555** .653** .536**
Culture Correlation
Pearson
Work Culture 1 .601** .669**
Correlation
Pearson
Work Values 1 .812**
Correlation
Performance Pearson
1
Management System Correlation
**. Correlation is significant at the 0.01 level (2-tailed).
Note: ** Denotes significance at a 1% level
The correlation coefficient between organizational culture and work culture is .555, which
indicates 55 percent positive relationships between organizational culture and work culture and
is significant at a 1% level. The correlation coefficient between organizational culture and work
values is .653, which indicates 65 percent positive relationships between organizational culture
and work values and is significant at a 1% level. The correlation coefficient between
organizational culture and performance management system is .536, which indicates 53 percent
positive relationships between organizational culture and performance management system and
is significant at a 1% level. The correlation coefficient between work culture and work values
is .601, which indicates 60 percent positive relationships between work culture and work values
and is significant at a 1% level. The correlation coefficient between work culture and
performance management system is .669, which indicates 66 percent positive relationships
between work culture and performance management system and is significant at a 1% level.
The correlation coefficient between work values and the performance management system is
.812, indicating 81 percent positive relationships between work values and the performance
management system and is significant at a 1% level.

5.2. Regression Analysis

HYPOTHESES
H0: There is no significant relationship between performance management systems based on
organizational culture in the healthcare organization at Thanjavur.
H1: There is a significant relationship between performance management systems based on
organizational culture in the healthcare organizations at Thanjavur.

Table 2
Variables Entered/Removed
Model Variables Entered Variables Removed Method
b
1 Work Value, Organizational Culture, Work Culture . Enter

a. Dependent Variable: Performance Management System

b. All requested variables were entered.

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 D. Vidya and P. Kothai

Table 3
Model Summary
Model R R Adjusted R Std. Error of the Estimate
Square Square
.85
1 .722 .692 1.77581
0a
a. Predictors: (Constant), Work Value, Organizational Culture, Work Culture
b. Dependent variable: Performance Management System

Table 4
ANOVAa
Model Sum of Degrees Mean F Significance
Squares of Square
freedom
Regression 229.170 3 76.390 24.224 .000b
1 Residual 88.298 28 3.154
Total 317.469 31
a. Dependent Variable: Performance Management System
b. Predictors: (Constant), Work Value, Organizational Culture, Work Culture

Table 5
Coefficients
Model Unstandardize Standardize t Sig. 95.0% Collinearity
d Coefficients d Confidence Statistics
Coefficients Interval for B
B Std. Beta Lower Upper Toleranc VIE
Error Bound Boun e W
d
1.4 1.03 .30
(Constant) 1.410 -1.426 4.352
63 7 9
Organizational .20 1.07 .00 1.49
.187 .131 -.182 .583 .670
Culture 1 4 2 3
1
.37 1.66 .02 1.85
Work Culture .223 .226 -.086 .827 .538
0 2 8 8
.94 4.86 .00 1.61
Work Value .194 .617 .547 1.342 .618
4 6 0 8
a. Dependent Variable: PMS

Since the p-value is less than 0.05 (p<0.05), the marks Impact of Organizational Culture
has a significant relationship with the Effectiveness of Performance management system (.002).
The Work Culture has a significant relationship with the Effectiveness Performance
management system (.028). It is found that the Work Value of the employees has a significant
relationship with the Effectiveness of the performance management system (.000)
The R square value was found to be 0.722. It reveals that the Impact of Organizational
Culture has explained 72.2 percent of the performance management system on the Effectiveness
of the Performance Management System
Model:

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 A Study on the Impact of Organizational Culture on the Effectiveness of Performance Management
Systems in Healthcare Organizations at Thanjavur

CGPA = 1.463+0.201(OC) + 0.370(WC)+0.944(WV)

Where OC – organizational culture
WC – work culture
WV – work values

6. FINDINGS AND SUGGESTIONS

• From this study, it’s clear that, in which organization the goals are explained to
employees as well as it is challenging, has a positive impact on the effectiveness of the
PMS.
• The culture of encouraging people and giving regular feedback about Employees’
strengths and weaknesses has a positive impact on the effectiveness of the PMS.
• The work culture of spending extra hours, if needed by employees to complete their
work, and the culture of proper training have a positive relationship with the
effectiveness of the PMS
• The work culture such as keenness to learn and performance-related promotion has a
positive impact on the effectiveness of PMS.
• Work values like creativeness, a favorable working environment, and work-based
reward have an impact on the effectiveness of PMS.
• For getting the intended results from PMS, Healthcare organizations have to concentrate
on their culture-related aspects and should take steps to improve their organizational
cultures, by communicating the values to employees, giving proper training, selecting
the right persons, and recognizing employees.

7. CONCLUSION
This study aims to analyze the impact of organizational culture on the effectiveness of the
performance management system and concludes that there is a significant impact of
organizational culture on the effectiveness of the performance management system. The
Effectiveness of Performance Management Systems depends on many factors, one of the
important factors is the organization's culture which helps the Employees and Managers to set
goals and track progress with shared tracking techniques.
Results of this study show that the aspects of organizational culture i.e. aspects related to
organization, aspects related to work culture, and aspects related to work values must be
positive to get the expected outcome from the PMS in the Healthcare Organization.

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