1

Organizational Climate; Production Employees in a Semi-

conductor Manufacturing Company in Laguna.

A Thesis Presented to
The Faculty of Business Administration
Lyceum of the Philippines University - Batangas

In Partial Fulfillment of the Requirements to the

Bachelor of Science in Business Administration - ETEEAP
Major in Human Resource Management Development

By:

Dela Cruz, Ma. Kristina Artita

Magampon, Rowelyn, Orpia
Rivera, Kristine, Opena

Filomena Mendoza, Ph.D.

2021
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INTRODUCTION

The idea of organizational climate is not a hot issue among organizational

theorists, academics, and practitioners today. One advantage of the climate idea is

that it allows different aspects of behavior inside companies to be investigated and

regarded as a whole. Thus, an industrial relations director, a vice president of

production, or a financial analyst, among others, might use the notion of climate to

explain the atmosphere inside his or her unit or the entire firm. Organizational

climate is described in this research as a set of traits that may be experienced

inside a certain organization, department, or unit.

In today's chaotic and dynamic world, a company's ultimate success and

survival are dependent on the knowledge, skills, and capacities of its people;

however, both are even more dependent on channeling those talents and

knowledge toward the company's goals. Only a pleased employee will be devoted

to his or her profession, show ingenuity, and strive to satisfy the demands and

desires of the company's clients.

This study will focus on the organizational climate indicators; conformity,

organization clarity, warmth and support, and leadership . In today’s times of fierce

global competition, almost all companies seek the opportunity to increase staff

commitment and direct them (the staff) towards achieving company’s objectives.

For company’s managers, this means employing classical as well as motivational

measures in the process of staff motivation.

Employee satisfaction and motivation represent the main principles of

contemporary human resources management, since only through quality motivation

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systems can a company increase its competitive advantage and value. Previous

concepts of motivation schemes are becoming insufficient and ineffective, and it is,

therefore, indispensable to develop and introduce new ones; their elaboration and

versatility will greatly contribute to employee satisfaction and increase their

performance.

This study asks how organizational climate impacts on employees. It will

present organizational climate in terms of conformity, organizational clarity, warmth

and support and leadership of the Semi-conductor Company. This study will help

the researcher to identify current status of organizational climate to their industry,

its benefits on the employees. As Leaders, and future managers, the result of this

study will provide them necessary data that will help them to improve organizational

climate, to motivate and create better employee performance.

OBJECTIVE OF THE STUDY

This study aims to determine the organizational climate on production

employees in a semi-conductor manufacturing company in Laguna.

Specifically, to describe the demographic profile of the employees in a Semi-

conductor Manufacturing Company in Laguna in terms of age and length of service.

It will also present response towards an organizational climate in terms of

conformity, organization clarity, warmth and support, and leadership and will find

out the differences in the responses when grouped according to profile.

Furthermore, this study will propose an action plan to improve organizational

climate.
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LITERATURE REVIEW

Organizational Climate

Organizational climate is defined as the set of measurable properties of the

work environment that is either directly or indirectly perceived by the employees

who work within the organizational environment that influences and motivates their

behavior (Holloway, 2012: 13). Organizational climate is defined as the recurring

patterns of behavior, attitudes and feelings that characterize life in the organization

more related to atmosphere and values (Aiswarya and Ramasundaram, 2012:

353). An organizational climate refers to the values, beliefs that are not visible but

exist within the employee’s behavior and action. (Moghimi and Subramaniam,

2013: 3). In literature, there is no generally accepted definition of organizational

climate. Because it is a complex, multilevel, and multidimensional phenomenon

derived from employees’ perceptions of their experiences within an organization,

stable over time and widely shared within an organizational unit.

Organizational climate is based on the premise that the overall health of an

organization can be assessed by measuring individual employees’ perceptions of

their work environments. Together these individual observations serve as

aggregate data describing how well the organization performs and how well it treats

its employees (Giles, 2010: 68). In other words, organizational climate represents

how the employees feel about the atmosphere in the organization. For the

development of an organization, it is necessary to make employee’s feel good as

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employees are the key resources of an organization. With changing scenarios in

the world economy if companies want very smart, professional, innovative and

positive team members, companies will promote a healthy work environment and

organizational climate so that the employees feel free to exhibit positive behaviors

(Choudhury, 2011: 112).

In a fiercely competitive global setting, achieving organizational

effectiveness and organizational survival is based on employee’s attitudes

and behaviors. For this reason, organizational climate has gained importance in

organizational behavior researches. Researches in this area has examined

organizational climate in various organizational contexts and related it to

several outcomes at an individual, group, and organizational level. In particular,

researchers have found links with organizational climate and employee

performance, organizational effectiveness, productivity, job satisfaction,

organizational commitment, organizational justice, work motivation, organizational

alienation, anxiety, propensity to leave (Rahimic, 2013: 131).

However, researchers suggest that organizational climate promotes positive

behaviors in organizations such as organizational citizenship behavior, innovative

behavior, creative and proactive behaviors (Moghimi and Subramaniam, 2013: ).

On the other hand, it triggers negative work behaviors such as absenteeism,

lateness, putting little effort into work, Pelin Kanten and Funda Er Ülker, The

Macrotheme Review, Summer 2013 taking excessive breaks, wasting resources,

arguing workmates, acting rudely towards them etc. (Pena-Suarez et al., 2013).
 6

Organizational climate researches can be traced back to the 1930s. Since

then, many studies conducted to date have been dealt with issues such as the

definition of the organizational climate, measurement and dimensions of this

concept. The measurement and dimensions of organizational climate have been

the causes for much of the debate surrounding the concept. According to

(Alonderiene, R.; Majauskaite, M. 2016) the organizational climate is defined as

how employees perceive organizations’ internal functions like decision-making and

rule-setting in the workplace. It can also be defined as a set of behaviors that

describe an organization. An organizational climate can be specific for each

organization. It may make an organization different from other organizations and

influence employees’ work behavior in the organization. The organizational

climate can also leave a perception in the employees’ mind towardsthe

management of their working unit. It is related to employees’ perceptions on their

own and other colleagues’ effectiveness in job and task implementation.

In organizations that are public or private where employees’ perception of

their organizational climate is more egoistic and less ethical, employees are more

prone to corruption (Gorsira, M.; Steg, L.; Denkers, A.; Huisman, W. 2018)

Griffin, 2016 suggests that the climate generally refers to direct perceptions

of the work environment. Organizations need a positive climate in their workplace

to boost employee motivation and raise the opportunity that employees will

implement adequate efforts doing their tasks. Therefore, a positive climate

encourages employees’ productivity and decreases turnover. Thus, it is vital for

business success. Chang, Wu, and Liu 2018, collected data from 34 human
 7

resources managers and 354 employees working in the Chinese manufacturing

and service industries. Their results demonstrate that work style and workplace

events influence employees’ job satisfaction.

According to Jung, Chow, and Wu 2003 and Jung and Ali, 2017, the

organizational climate is one of the most important characteristics of a great and

comfortable workplace. Therefore, if a leader can create a great workplace, it will

increase employees’ productivity. Several studies (Kao, R.-H., 2017, Maamari,

B.E.; Majdalani, J.F, 2017) point out the positive impact of leadership style on the

organizational climate.

Conformity
Conformity refers to yielding to group pressures when no direct request to

comply with the group is made. A classic study illustrates nicely what conformity is:

male college students were asked to participate in visual perception experiments,

during which confederates of the experimenter gave incorrect judgments

Conformity dimension, in short, can be described as rules, regulations, and

procedures that do not add value. In that environment, the rules appeared to have

no value and I was unable to find anyone who took interest in changing my views

on the subject. My perception remained: I had to follow unnecessary rules,

regulations, and procedures to get the job done. I was often frustrated because I

spent more time weeding through paperwork than I did performing my role.

True, in the workplace there are many rules that we all must follow in order

to fulfill our responsibilities. But the rules, regulations, and procedures in an

organization must make sense to those who must follow them. They ought to be
 8

explained so they are seen as a necessary standard rather than a burdensome

conformity.

Without a clear understanding of the “big picture” and how the rules,

regulations, and procedures facilitated the function, they did not perceive those

rules as a Standard (the definition of doing good, thorough work). This is where the

dynamic interaction among the dimensions becomes critical. If appropriately

clarified, a leader can change what may appear to be high Conformity into high

Standards. If employees understand why rules and procedures exist, they are more

likely to perceive them as standards for performance, rather than conformity (rules

of no value). When challenging, realistic standards are in place, and employees

perceive the rules of the organization to be an important part of meeting the

standards, they are more likely to seek and accept responsibility. Wouldn’t you be?

When people seek and accept responsibility and have clarity of roles, goals,

and expectations, they are far more likely to hit targets and be results-driven. The

key to replicating this is to provide real-time feedback and offer praise for a specific

job well done. This brings us to the Rewards dimension. In general, when people

think of rewards in the workplace, they think of the tangibles (typically the financial

ones). Research suggests that, if an organization is compensating at fair market

rate, financial incentives are a short-term and shortsighted approach to increasing

morale and productivity. Performance-related rewards, including more praise than

criticism related to a specific job well done will, over time, have a more dramatic

impact on productivity than throwing more money at the symptom.

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Low Conformity, high Responsibility, high Standards, moderate to high

Rewards, and high Clarity will result in high Sense of Team, the final dimension.

While each dimension can, and in many instances should, stand alone, you can get

a greater bang for your buck by looking at climate as being organic.

There are clearly dynamic interrelationships between the dimensions and

small interventions can influence big outcomes. This model allows leaders the

opportunity to get results pinpointing the causes rather than just the symptoms of

worker morale and poor results.

Organization clarity

Clarity is a clearness, lucidity, and simplicity as to perception or

understanding; a freedom from indistinctness or ambiguity. Organizational clarity is

the greatest strategic advantage the organization can have. Initiated in strategy,

embodied by leadership, and delivered by teams, clarity provides the foundation for

bottom line results. The main function of a leader then is to provide clarity around

six basic questions: who, what, when, where, why, and how.

This series aims to equip and inspire leaders to enact this fundamental

leadership skill to provide clarity to our people and teams. We do this through the

series by discussing the “three C’s” of organizational clarity: Create Essential

Organizational Core: It is essential to clearly define the team’s essential core

drivers & beliefs so that every person on our team can understand, connect to, and
 10

be inspired by it. This is what drives what we do and don’t do every day. Clarify &

Simplify That Core: The drafted core may sound intelligent and resonate to the

small group of senior leaders that likely crafted it, but does it actually mean

something to the whole team – especially our most junior members? They must

ensure our core is clear, simple, and impactful. Communicate the Core: It is as

must to communicate, embed, and reinforce this core into everything they say and

do as leaders, everything they do / don’t do as a team, and it must give meaning to

everything the people routinely experience and do.

Organizational clarity is crucial because it forms the foundation of

empowerment. The days of strict hierarchy and decisions being handed down from

on high are over. The environment in which we must function is simply changing

and moving at such a speed that there is not time for excessive contemplation and

waiting. What is needed is organizational agility, a subject we have covered in a

previous Journal. Agility can be created through a strategy of having a clear and

simple mission, creating a workforce of people of character and competence, and

building a culture of shared values and norms.

Warmth and support

This dimension refers to the level at which employees help each other in

their work and also feel that they will get support from their colleagues and

managers in challenging times. A strong level of fellowship between employees

leads to confidence in sharing ideas and opinions without fear of ridicule or

reprimand.
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Leadership

There are countless definitions of leadership that exist. Yet, a proper

understanding of why leadership is so significant. Gandolfi (2016) asserts that the

combination of five components render a potent working definition of leadership - (i)

there must be one or more leaders, (ii) leadership must have followers, (iii) it must

be action oriented with a legitimate (iv) course of action, and there must be (v)

goals and objectives.

Prior to delving into servant leadership specifically, it is important to note the

principles of effective leadership based on what has been presented thus far. First

are two guiding principles, (i) virtually everyone has some capacity to form

leadership relationships (Gandolfi, 2016), and (ii) leaders are made and not born

(Gandolfi & Stone, 2016). These misconceptions of leader and servant have

produced a belief that servant leaders engage a lackadaisical or laissez-faire style.

Plainly, servant leadership is neither disengaged nor weak and it does not lack

enthusiasm and determination (i.e., lackadaisical). It also does not let things take

their own course without interfering (i.e., laissez-faire) (Gandolfi et al., 2017).

Servant leaders are as proactive, ambitious, and driven as any other leader. They

just have a different focus and set of motivation that guide their leadership and

decision making.

Transactional leaders and organization members agree on terms, and the

leaders recognize and reward hard-working employees and correct or punish

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employees for deviations or errors. Transformational leaders motivate employees

to go beyond specific expectations (Doucet, Fredette, Simard, & Tremblay, 2015).

Transformational leaders focus on promoting higher levels of motivation and

morality for leaders and followers. Transformational leadership achieves the

process of interaction between leaders and subordinates by enhancing this

relationship to the level of morality and motivation beyond the original contractual

relationship, where the subordinates sincerely respect the leader and are willing to

follow and obey, and the incentive actions of the leader cause the subordinates to

accept the organization's vision and mission. Sheraz, Zaheer, Rehman, and

Nadeem (2015) also state that transformational leaders can enhance the value of

ethics in the workplace.

METHODS
Research Design

The researcher employed the use of quantitative research design in order to aims

to assess the impact of organizational climate on production employees in a Semi-

conductor Manufacturing Company in Laguna. Descriptive research design is a

scientific method which involves observing and describing the behavior of a subject

without influencing it in any way. Descriptive research is often used as a pre-cursor

to quantitative research designs, the general overview giving some valuable

pointers as to what variables are worth testing quantitatively (Shuttleworth, 2010)

The study will utilize the descriptive method as it aims Total Quality

Management to cast light on current issues on Total Quality Management and

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Employee Productivity through processing of data that will enable to describe the

characteristics and behavior of sample population in the present situation.

Participants of the Study

The participants of the study were the randomly selected production

employees in a Semi-conductor Manufacturing Company in Laguna. Production

department is composed of 300 regular employees. Based on the data using

Raosof sample size calculator, the study requires 207 respondents considering,

99 percent confidence level and five percent margin of error at a constant

response distribution of 50 percent.

Data Gathering Instrument

The data required in this study were be obtained through a modified

questionnaire taken from Organizational Commitment Questionnaire (OCQ)

developed by Mowday, Steers, and Porter (1979).

The first part is the profile of the participants and second part is the

assessment of the Organizational Climate Impact on employees, responses to

each item were rated using a 4-point scale anchors labeled; 4 – Strongly Agree 3

– Agree 2 – Disagree 1 – Strongly Disagree

Summary of Reliability

Indicators Cronbach Alpha Remarks

Conformity 0.905 Excellent
Organization 0.903 Excellent
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George and Mallery (2003) provide the following rules of thumb:

“_ > .9 – Excellent, _ > .8 – Good, _ > .7 – Acceptable, _ > .6 – Questionable, _ > .5 – Poor, and
_ < .5 – Unacceptable”

Data Gathering Procedure

The researcher submitted the topic for approval, after approval, the

researcher modified questionnaire for checking by the research adviser. After the

approval of the questionnaire, the researcher administered the survey using Google

forms to observe health protocols. The identified participants were texted or

messaged on the purpose of the research. Follow up was be done through chat

messages, Facebook and other social media platforms. The distribution and

retrieval will cover the month of April.

Data Analysis

Data were collected through Google forms; data gathered were tallied and

tabulated, and performed data analysis, the following statistical tools were used.

Frequency and percentage distribution were used to describe the demographic

profile of the respondents. Weighted means and ranking were used to the current.

Frequency distribution, weighted mean and Mann Whitney U and Kruskal

Wallis are some of the statistical tools used in tabulating and analyzing the data

gathered.

Ethical Consideration
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The respondents’ participation in this study was on a purely voluntary

basis and respondents were not mandated to declare their names or other

personal information. The researcher explained the purpose of the study through

Consent Forms provided in the Google forms. Respondents was assured of the

privacy and no physical and psychological risk are likely to occur.

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RESULTS AND DISCUSSION

Table 1
Percentage Distribution of the Respondents’ Profile

Age Frequency Percentage (%)

Generation X: Born 1965-1980 22 10.50
Millennials: Born 1981-1996 151 72.20
Generation Z: Born 1997-2012 36 17.20
Length of service
5 years and below 141 67.50
6 to 15 50 23.90
16 to 25 12 5.70
26 to 40 6 2.90

Table 1 presents the percent distribution of the respondent’s profile; it can be

observed from the table that majority of the respondents are Millennials: Born 1981-

1996 which comprised 72.20% or having a frequency of 151. It is followed by

Generation Z: Born 1997-2012 which constitutes 17.20% of the respondents, The

least number of respondents were Generation X: Born 1965-1980 which is only

10.50% of them or a frequency of 22. Millennials make the majority of today’s

workforce. Moreover, according to the U.S. Bureau of Labor Statistics, they will

make 75% of the US workforce by 2030. Millennials are born on the edge of the

millennium and had several distinctive features, which differ them from the people

before. Millennials are also referred to as the “Generation Y” or the “Echo Boom”.

This age group has also been called the “Peter Pan” or “Boomerang Generation”

because of the propensity of some to move back in with their parents (Main, 2017),
 17

perhaps due to economic constraints, and a growing tendency to delay some of the

typical adulthood rites of passage like marriage or starting a career.

This generation occupies a major part of the workforce population today.

Like other generations before, millennials are described with a unique characteristic

but different from other generations. Millennials are known as digital natives and

connects themselves to the outside world in most of time and which shapes their

identities. They have a special attitude towards life with their own fears, problems

insecurities, and difficulties.

An article wrote by Dela Cruz (2016) stated that millennials are predicted to

comprise half of the entire global workforce by the year 2020. In fact, there were

estimated 47.1% of the more than 66 million Filipino workers are identified as

millennial thus occupying a relatively large portion of the Philippine economy.

Based on the premises, this study which focuses on millennials and aims to know

how they behave and react towards the workplace they are at. This will examine

how millennials perceive the company or organization and the leader or manager. It

also examines the level of importance of the job factors in terms of work conditions,

human relations and benefits derived in the workplace as it determines their stay in

the company. It is helpful for the company because it serves as guide on how they

can understand, guide, manage, and sustain millennial employees in their

company. For the side of employee, it is better to know the different job factors and

its relation to each other for them to have a self-assessment in the workplace and

know if they are in the right path of work life that they wanted to have. At the end,

the study would like to identify the significant determinants of retention as

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measured in terms of length of service. Thus, to gain employees’ career

commitment to the organization and increase retention the employer needs to

identify which retention factors more influence to career commitment.

In term of their length of service, most of the respondents were in the

company 5 years and below comprising 141 respondents which is equivalent

67.50%, followed by those with the company for 6 to 15 years with a frequency of

50 or 23.90%, then those who are employed for 16 to 25 years with 12 or 5.70%,

finally, those who are with the company for 26 to 40 year which comprises of 6 or

2.9%.

Filipino millennials consider compensation, salaries, and health insurance as

the most important benefits they look for in a company. Good salaries and wages

reduce financial stress and makes the employee more productive. Benefits and the

salaries that were given to the employees enhance the job satisfaction of the

employees. In a way of giving benefits to the employees, they tend to commit

themselves in the company (Munir & Rahman, 2016).

Table 2
Organizational Climate in terms of Conformity

Weighted Verbal Rank

Indicators
Mean Interpretation
1. My career outlook motivates me to
3.18
work for this organization Agree 5
2. The time provided in my workday is
3.25
sufficient to fulfill my duties Agree 3
3. My work in this organization provides
3.23
me and my family with security Agree 4
4. The services offered by this
3.26
organization are important to society Agree 2
5. I feel that this company contributes to
3.29
improvement of peoples’ life Agree 1
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Composite Mean 3.24 Agree

Legend: 3.50 – 4.00 = Strongly Agree; 2.50 – 3.49 = Agree; 1.50 – 2.49 = Disagree; 1.00 – 1.49 =
Strongly Disagree

Table 2 presents the assessment on organizational climate in terms of

conformity. The composite mean of 3.24 indicates that the respondents are agreed

on the above indicators.

The Conformity dimension, in short, can be described as rules, regulations,

and procedures that do not add value. In that environment, the rules appeared to

have no value and I was unable to find anyone who took interest in changing my

views on the subject. The perception remained that there’s a need follow

unnecessary rules, regulations, and procedures to get the job done. True, in the

workplace there are many rules that we all must follow in order to fulfill our

responsibilities. But the rules, regulations, and procedures in an organization must

make sense to those who must follow them. They ought to be explained so they are

seen as a necessary standard rather than a burdensome conformity. (Henry 2021)

Among the items cited, feel that this company contributes to improvement of

peoples’ life rank the highest with a weighted mean of 3.29. The company provides

employee benefits that aide them to have a better quality of life, Benefits like

bonuses every June and December, educational assistance for the employee and

members of his family. Package also includes medical assistance to the employee

and immediate family.

Compensations is one of the important things since the basic goal of an

employee is to earn money (Tulgan, 2018). The results show that millennials want
 20

a salary boost to go with a job and they want perks and will change jobs to get

them. Employees are not just looking to shop around for the experience, they want

a pay raise to come with it. The benefits they value align with those that other

generations see as most important: things closely related to quality of life like health

insurance, paid vacation, and retirement plans (Steinhilber, 2017). A study from

MetLife (2017) found that 60 percent of employers say offering health insurance

has led to higher productivity levels.

Followed by services offered by this organization are important to society

and time provided in my workday is sufficient to fulfill my duties obtained mean

score of 3.26 and 3.25 respectively. The company produce product needed by the

industry and community. It also participates in the community by taking part in

various activities like Brigada Eskwela in school of nearby areas, they also join

Clean and Green Projects like restoration of Mt. Banahaw. The company

implements eight hrs work per day and two days restdays which sufficient to fulfill

their duties as an employee.

Researchers suggest that organizational climate promotes positive

behaviors in organizations such as organizational citizenship behavior, innovative

behavior, creative and proactive behaviors (Moghimi and Subramaniam, 2013: 3).

On the other hand, it triggers negative work behaviors such as absenteeism,

lateness, putting little effort into work, Pelin Kanten and Funda Er Ülker, The

Macrotheme Review 2(4), Summer 2013 147 taking excessive breaks, wasting
 21

resources, arguing workmates, acting rudely towards them etc. (Pena-Suarez et al.,

2013: 137).

However, items such as work in this organization provides me and my family

with security and career outlook motivates me to work for this organization rated

the least. Although it is the least of the indicators, however the salary can provide

the family’s basic needs, including health care benefits and insurance for every

employee. Before pandemic, the company gives oppurtanity for selected employee

to trained abroad.

Table 3
Organizational Climate in terms of Organization Clarity

Weighted Verbal Rank

Indicators
Mean Interpretation
I am familiar about the objectives of this
3.19
organization Agree 5
I always receive information needed to do
3.25
my job Agree 3.5
I am encouraged to contribute to the
3.25
improvement of work processes Agree 3.5
Clarification and guidance from my
superiors regarding my tasks help me 3.26
carry out my work Agree 2
I believe that my work is important for the
3.36
organization to reach its goals Agree 1
Composite Mean 3.26 Agree
Legend: 3.50 – 4.00 = Strongly Agree; 2.50 – 3.49 = Agree; 1.50 – 2.49 = Disagree; 1.00 – 1.49 =
Strongly Disagree

Table 3 presents the assessment on organizational climate in terms of

organization clarity. The composite mean of 3.26 indicates that the respondents are

agreed on the above indicators.

 22

Clarity is a clearness, lucidity, and simplicity as to perception or

understanding; a freedom from indistinctness or ambiguity. Organizational clarity is

the greatest strategic advantage the organization can have. Initiated in strategy,

embodied by leadership, and delivered by teams, clarity provides the foundation for

bottom line results. The main function of a leader then is to provide clarity around

six basic questions: who, what, when, where, why, and how.

Among the items cited, believe that my work is important for the organization

to reach its goals ranked the highest with 3.36 composite mean, Everyone is

important whatever position or whatever role in company, for example, operator on

the manufacturing line can temporarily replace operator for the production of units if

necessary.

In a review of studies investigating organizational climate and employees’

performance, the study of Ozge (2016) found that organizational climates exhibit

the clear role clarity dimensions result in a higher satisfaction and performance of

employees. It explained the characteristics of organizational climate, for instances

having a high level of self-governance, giving opportunities for employees,

sustaining connections among employees, concerning and demonstrating

enthusiasm for employees, perceiving workers' achievements also, holding them in

high respect result in more fulfilled employees.

It was followed by clarification and guidance from my superiors regarding my

tasks help me carry out my work obtained mean score of 3.26. Then receive

information needed to do my job and encouraged to contribute to the improvement

 23

of work processes both ranked 3.5 with mean score of 3.25 respectively. Superiors

discuss our job responsibilities to teach of the team members, pre-shift toolbox

meetings update the employees with the performance status of the previous days

and set the targets for the days. Should there be a change in the plan for example,

the leader cascade immediately to the team to be able to adjust what was being

done in the area. There is also a program called KAIZEN in which employees can

suggest improvement. Upon meeting the set targets the team receives an

appreciation gift.

Griffin, 2016 suggests that the climate generally refers to direct perceptions

of the work environment. Organizations need a positive climate in their workplace

to boost employee motivation and raise the opportunity that employees will

implement adequate efforts doing their tasks. Therefore, a positive climate

encourages employees’ productivity and decreases turnover. Thus, it is vital for

business success. Chang, Wu, and Liu 2018, collected data from 34 human

resources managers and 354 employees working in the Chinese manufacturing

and service industries. Their results demonstrate that work style and workplace

events influence employees’ job satisfaction.

However, items such as familiar about the objectives of this organization

rated the least with 3.19 mean score. Vision, mission, values and objective of the

company were discussed during employee orientation, also there are visual

reference that can be seen in the hallway that will remind them of the company’s

objectives.
 24

Without a clear understanding of the “big picture” and how the rules,

regulations, and procedures facilitated the function, they did not perceive those

rules as a Standard (the definition of doing good, thorough work). This is where the

dynamic interaction among the dimensions becomes critical. If appropriately

clarified, a leader can change what may appear to be high Conformity into high

Standards. If employees understand why rules and procedures exist, they are more

likely to perceive them as standards for performance, rather than conformity (rules

of no value). When challenging, realistic standards are in place, and employees

perceive the rules of the organization to be an important part of meeting the

standards, they are more likely to seek and accept responsibility.

Table 4
Organizational Climate in terms of Warmth and Support

Weighted Verbal Rank

Indicators
Mean Interpretation
The org’s environment facilitates the
3.10
relationship between employees. Agree 2.5
I am happy with my work 3.17 Agree 1
My colleagues are always willing to help
3.10
each another Agree 2.5
The employees of this organization have a
2.97
good relationship with each other Agree 5
Other employees come promptly when I
2.99
need their help Agree 4
Composite Mean 3.06 Agree
Legend: 3.50 – 4.00 = Strongly Agree; 2.50 – 3.49 = Agree; 1.50 – 2.49 = Disagree; 1.00 – 1.49 =
Strongly Disagree

Table 4 presents the assessment on organizational climate in terms of

warmth and support. The composite mean of 3.06 indicates that the respondents

are agreed on the above indicators.

 25

Warmth and support dimension refers to the level at which employees help

each other in their work and also feel that they will get support from their colleagues

and managers in challenging times. A strong level of fellowship between

employees leads to confidence in sharing ideas and opinions without fear of ridicule

or reprimand.

Among the items cited, I am happy with my work ranked the highest with

3.17 composite mean, Employees are happy with what they do because aside from

work they have also build friendship. These people are those who have been in the

company for a long time, and they like what they do.

Amin Bahrami et al, (2015) emphasize the relationships between the

employee and organisational such as the employee wellness, priority for minority

people etc. have directly affected the perception of employee as well as their

performance. Organisational climates creates a clear direction of the organisation

to the employees in term of the future objectives and goals. The employees are

always being in the cognitive stage of understanding the structure of organisation

and in the state of readiness for change based on the planning of the organisation.

The leadership of upper management is playing a role in how good they deliver the

aims of organisation and manage the employees to the reach the goals. By having

a clear directions and objectives, the organisation will eventually become an

employer of choice and well known in the market with high rating.

Followed by organizations environment facilitates the relationship between

employees and colleagues are always willing to help each another both obtained

mean score of 3.10. The company exercises multi-skilling in the department so that
 26

in case of absences, they can get immediately replace needed manpower for the

day. The company offer monetary assistance when an employee needs finanacial

support. The HRD conduct monthly townhall meeting, every end of month reaches

and understand employees’ concern.

However, items such as other employees come promptly when I need their

help rated the least (2.99) and employees of this organization have a good

relationship with each other (2.97) mean score respectively. The area in charge is

permitted to attend quickly if an employee requires assistance at work, according to

company regulation. If is an emergency situation everybody is helping, however,

they have trained EPR members and First Aiders to response immediately. When it

comes to personal matters, it is common to seek advice from colleagues.At least,

it's normal that you stay in the area with fun and your fellow employees help you.

Employees are placed in various procedures, which means that some of them do

not have the opportunity to form positive relationships with their coworkers.

Table 5
Organizational Climate in terms of Leadership

Weighted Verbal Rank

Indicators
Mean Interpretation
When I am performing well, my superior
3.02
gives me positive feedback Agree 2.5
When I achieved my goal, my superior
3.02
compliments me Agree 2.5
My superior makes me feel that it is a
2.98
pleasure to get along with them. Agree 4
My superior explains carefully what I could
3.11
do and what I should do Agree 1
My superior helps with my career planning 2.95 Agree 5
Composite Mean 3.02 Agree
Legend: 3.50 – 4.00 = Strongly Agree; 2.50 – 3.49 = Agree; 1.50 – 2.49 = Disagree; 1.00 – 1.49 =
Strongly Disagree
 27

Table 5 presents the assessment on organizational climate in terms of

leadership The composite mean of 3.02 indicates that the respondents are agreed

on the above indicators.

Leadership is the ability of a leader to increase the effectiveness of the

group. In other words, a group of people with specific goals, when faced with

challenges or conflicts, makes use of many different resources to satisfy the

motivation of the members and reach goals. Leadership is the process of leading

members to achieve organizational goals. General leadership style is often divided

into transactional leadership and transformational leadership. Transactional leaders

trade or exchange valuable things (e.g., in the form of compensation, status, and

other incentives) to encourage followers to achieve the most basic job

performance; on the other hand, transformational leaders inspire and improve

followers to achieve higher levels of performance than usual and to promote

greater demand and desire among group members (Doucet, Fredette, Simard, &

Tremblay, 2015).

Among the items cited, superior explains carefully what I could do and what I

should do ranked the highest with 3.11 composite mean. Before an employee to

be endorsement of various areas/processes, HR provides necessary orientation

and trainings. Also, prior the daily operations, there is an operation instruction

guide, every morning, Team leaders hold a morning meeting providing updates and

essential information.

According to Jung, Chow, and Wu 2003 and Jung and Ali, 2017, the

organizational climate is one of the most important characteristics of a great and

 28

comfortable workplace. Therefore, if a leader can create a great workplace, it will

increase employees’ productivity. Several studies (Kao, R.-H., 2017, Maamari,

B.E.; Majdalani, J.F, 2017) point out the positive impact of leadership style on the

organizational climate.

Followed by when I am performing well, my superior gives me positive

feedback and when I achieved my goal, my superior compliments me, both

obtained mean score of 3.02. The company gives recognition (PEP Awardee),

incentives are given to selected employees, best operator and other performance

awards. If the area or department have reached or exceeded their target target or

monthly shipping requirement, and zero inventory variance every end of the month,

supervisors or managers express their gratitude by saying thank you.

However, items such as, superior makes me feel that it is a pleasure to get

along with them (2.98) and superior helps with my career planning other (2.95)

mean score respectively. Pressures are mostly experience during tight

manufacturing schedule, that occurs seasonally, and not everyone has the

opportunity to participate in the activities/event. Employees are given the

opportunity to advance through multitasking in preparation for their future careers,

but not everyone is promoted due to restricted slots and the requirement to

consider educational achievement.

Leaders and organization members agree on terms, and the leaders

recognize and reward hard-working employees and correct or punish employees

for deviations or errors. Transformational leaders motivate employees to go beyond

 29

specific expectations (Doucet, Fredette, Simard, & Tremblay, 2015).

Transformational leaders focus on promoting higher levels of motivation and

morality for leaders and followers. This form of leadership is concerned with the

needs and motives of followers and tries to help followers exert their maximum

potential (Northouse, 2013).

Table 6
Summary Table on Organizational Climate

Weighted Verbal Rank

KRA/Indicators
Mean Interpretation
1. Conformity 3.24 Agree 2
2. Organization Clarity 3.26 Agree 1
3. Warmth and Support 3.06 Agree 3
4. Leadership 3.02 Agree 4
Composite Mean 3.15 Agree
Legend: 3.50 – 4.00 = Strongly Agree; 2.50 – 3.49 = Agree; 1.50 – 2.49 = Disagree; 1.00 – 1.49 =
Strongly Disagree

Table 6 presents the summary Table on Organizational Climate. The

composite mean of 3.15 indicates that the respondents agreed on the above

indicators. Among the indicators, Organization Clarity (3.26) ranked first. It was

followed by Conformity (3.24), then Warmth and Support (3.06) and lastly,

Leadership with mean score of 3.02. The summary above, implies that many

employers relates organizational clarity in the workplace. Leadership ranks the

least of the indicators.

Leaders have their own leadership style towards their employees while

each employee also has their individual work style. Work style is the

accumulation of personalized work-related experiences. Different definitions of

work style result in typologies with different theoretical or applied values (Niculi¸tă,

2015).
 30

These work styles together have strong correlation with leadership style.

Work style in the organization depends on leadership style (Niculi¸tă, 2015).

Leaders have their own leadership style to lead their employees. In addition, the

style of work offered in different organizations may not be the same. Sarros et al.

(2016) examined the relationship between leader’s behavior (transactional and

transformational styles) and aspects of an organization’s structure (i.e.,

centralization, formalization dimensions). (Borges, N.J.; Savickas, S., 2014)

Table 7
Difference of Responses on Organizational Climate When Grouped According
to Profile

Age U / λ2c p-value Interpretation

Conformity 303.5 0.116 Not Significant
Organization Clarity 323.5 0.219 Not Significant
Warmth and Support 287.5 0.075 Not Significant
Leadership 370.5 0.676 NotSignificant
Length of Service
Conformity 3.182 0.364 Not Significant
Organization Clarity 1.194 0.754 Not Significant
Warmth and Support 2.739 0.434 Not Significant
Leadership 0.298 0.96 Not Significant
Legend: Significant at p-value < 0.05

Table displays the comparison of responses on organizational climate when

grouped according to profile. It was observed that there was no significant

difference since the computed p-values were all greater than the alpha level of

0.05. This means that responses do not vary significantly and implies that the

responses are the same across the respondents profile. . This means that the

responses are not that different.

 31

The organizational climate is not significantly different to the respondents in terms

of their age and length of service. Both profiles do not affect perceptions of the

respondents in terms of organizational climate. Respondents agreed that the existing

organizational climate is favorable to their working conditions.

Table 8
Action Plan to Enhance Organizational Climate in terms of Leadership

Person/s
KRA Strategies
Responsible
Superior helps with  Create succession plan to
the employees’ produce next in line leaders of the
career planning area.  Supervisors
 Engage employees on regular Managers
counseling and discussion on
performance  Immediate
 Improve performance evaluation Superiors
allow employees to rate
themselves
 Create continuing programs that
will encourage participation of
employee.
 Promote regular employee  Supervisors
Superior makes the
engagement activities Managers
employee feel that it
 Improve employee bonding and
is a pleasure to get
belongingness  HR
along with them.
 Introduce motivation training to Managers
Leaders/Supervisors, to help them
encourage and motivate team
members
 32

CONCLUSION

1. Majority of the respondents are millennials and are in the company for

five years and below.

2. Respondents agreed towards all indicators of organizational climate

of a workplace in terms of conformity, organization clarity, warmth and

support, and leadership

3. There was no significant difference since the computed p-values were

all greater than the alpha level of 0.05 which means that responses

do not vary significantly and implies that the responses are the same

across the respondent’s profile.

4. A propose an action plan was drafted to improve organizational

climate.

RECOMMENDATION

1. Internal surveys may be carried out frequently to know the concerns and

issues of the employees.

2. HR may conduct training for company leaders, to improve leadership

skills.

3. The company may implement social responsibility projects involving

employees in the activities.

4. Proposed action plan may be implemented to improve the organizational

climate
 33

5. Future researcher may conduct similar studies using other variable and

respondents.

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The Impact of Leadership, Organizational Culture and Organizational Climate on

Employee Job Satisfaction (Case Study: PT Garuda Indonesia (Persero)
Tbk) Setyo Riyanto*, Mangandar Panggabean Master of Management
Mercu Buana University Jakarta, Indonesia
*setyo.riyanto@mercubuana.ac.id, andar.gabe@yahoo.co.uk