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Article9byOluOjo PDF
Article9byOluOjo PDF
Olu Ojo
Abstract
This research study assesses empirically the impact of corporate culture on employee job performance
as well as organisational productivity using Nigerian banking industry as the case study. We try to ascertain
if organizational culture affects employee job performance, and to formulate recommendations regarding
corporate culture and employee job performance. In order to achieve the above objectives, the following
research questions were asked: Does corporate culture have any effect on employee job performance? And
in what way does corporate culture impacts employee job performance? Two hypotheses were advanced:
(i) There is no positive relationship between organizational culture and employee job performance, and
(ii) There is no positive relationship between corporate culture and organizational productivity in Nigerian
banking industry. The study uses survey research method. The case study companies were selected using
stratified and simple random sampling techniques; while our respondents were selected using simple random
sampling technique. The findings of this study are that a large number of respondents (57.7%) strongly
agree that corporate culture has effect on employee job performance, and that 48.7% of the employees also
agree that corporate culture determines the productivity level of the organization. These findings made us
to accept our two alternative hypotheses and reject the null hypotheses because in both cases the calculated
values of chi-square are greater than the tabulated values.
therefore, to be taught to new members as the When we walk around an organization, there
correct way to perceive, think, and feel in relation are elements of the organization’s culture that are
to those problems. (Schein, 1990).” ‘on the surface’ and are relatively easily visible. We
In other words, as groups evolve over time, they can see many cultural symbols (e.g., whether your
face two basic challenges: integrating individuals office is on a floor close to the top or the bottom
into an effective whole, and adapting effectively of the building, how big your office is), artefacts
to the external environment in order to survive. As (e.g., computers), and patterns of behaviour (e.g.,
groups find solutions to these problems over time, how and where people interact, how they behave
they engage in a kind of collective learning that in formal and informal meetings).
creates the set of shared assumptions and beliefs Equally important, but the less visible aspects
we call “culture.” of culture are norms, values and basic assumptions
Morgan (1997) describes culture as “an active people make.
living phenomenon through which people jointly Another way of conceptualizing organizational
creates and recreates the worlds in which they culture is in terms of its ‘hard’ and its ‘soft’ sides.
live.” As we see in Figure 2, organizational culture is
For Morgan, the three basic questions for ‘supported’ by both social/psychological aspects
cultural analysts are: (e.g., stories, symbols, rituals) and by some more
concrete elements such as power structures,
• What are the shared frames of reference that hierarchical structure and control systems (e.g.,
make organization possible? financial, measurement and reward systems).
• Where do they come from?
• How are they created, communicated, and Figure 2: Hard and Soft Model of Organisational
sustained Concept
RE
LS
W
AR
NORMS
M
DS
SY
ASSUMPTIONS
1).
CU
Power
Symbols Structures Source: Organizational Cultural Analysis: The
Importance of Organizational Culture
Stories Org’al Copyright©1999, 2000 Holistic Management Pty.
Culture
Myths Estructures
Ltd...
Ritual Control
Routines Systems Organizational culture has been linked to
Soft Hard
economic performance and organization viability/
success (Denison & Mishra, 1995; Pothukuchi,
Source: Organizational Cultural Analysis: The Damanpour, Choi, Chen, and Park 2002; Sorensen,
Importance of Organizational Culture 2002; Devis, 2007). For example, organizations
Copyright©1999, 2000 Holistic Management Pty. dedicated to continuous improvement, with
Ltd... visionary leaders who ‘walk their talk’ and focus
on a set of core values, have been shown to be more them and to interact with other employees who
financially successful in the long-term ( Kotter & know the culture and believe in it.
Heskett, 1992). Organizational culture has also People are constantly surrounded by culture.
been shown to be important for successful new It forms the background (often invisible) of
product/process innovation and organizational our work-lives, colouring everything in an
change (Plakhotnik and Tonette, 2005; Umiker, organization. Organizational culture also provides
1999). a powerful mechanism for controlling behaviour
‘Culture is one of the most precious things by influencing how we attach meaning to our
a company has, so they must work harder on it world and how we interpret events.
than anything else,’ says Herb. Various studies
indicate that companies with strong cultures Objectives Of The Study
are more likely to be successful, but only under
a particular set of conditions. The effect of The primary objective of this study is to assess
organizational culture depends partly in its the impact of corporate culture on employee job
strength. Corporate culture strength refers to how performance.
widely and deeply employees hold the company’s In line with this primary objective, the
dominant values and assumptions. In a strong secondary objectives are as follows:
organizational culture, most employees across all
subunits hold the dominant values. These values i. To ascertain if organizational culture affects
are also institutionalized through well-established employee job performance.
artefacts, thereby making it difficult for those ii. To determine empirically the relationship
values to change. Furthermore, strong cultures between corporate culture and employee job
tend to be long-lasting; some can be traced back performance.
to company founder’s values and assumptions. In iii. To formulate recommendations regarding
contrast, companies have weak culture when the corporate culture and employee job
dominant values are short-lived and held mainly performance.
by a few people at the top of the organization.
A strong corporate culture potentially increases Research Questions
a company’s success by serving three important
functions: This research study is poised towards providing
i. Control System: Organizational culture is answers to the following questions:
a deeply embedded form of social control that
influences employee decision and behaviour. i. Does corporate culture have any effect on
Culture is pervasive and operates unconsciously. employee job performance?
ii. Social glue: Organizational culture ii. In what way does corporate culture impacts
is the ‘social glue’ that bonds people together employee job performance?
and makes them feels part of the organization
experience. Employees are motivated to internalize Research Hypotheses
the organization’s dominant culture because this
helps fulfil their need for social identity. This In order to answer the research questions and
social glue is increasingly important as a way to achieve the objectives of the study, the following
attract new staff and retain top performers. hypotheses are advanced and will be tested in the
iii. Sense-making: Organizational culture assists course of this study.
the sense-making process. It helps employees
understand what goes on and why things happen Hypothesis 1
in the company. Corporate culture also makes it H0: There is no positive relationship
easier for them to understand what is expected of between corporate culture and employee
job performance in Nigerian banking industry could not permit or allow for a greater sample
H1 There is a positive relationship between size.
corporate culture and employee job performance Every research work has a framework for
in Nigerian banking industry. collecting data. Its function is to ensure that
Hypothesis 2 the required data are collected accurately and
H0 There is no positive relationship between economically. Primary method of data collection
corporate culture and organizational productivity was used in this study. The primary data consists
in Nigerian banking industry. of a number of items in structured questionnaire
H1 There is a positive relationship between that was administered to the respondents. The
corporate culture and organizational productivity decision to structure the questionnaire is predicated
in Nigerian banking industry. on the need to reduce variability in the meanings
possessed by the questions as a way of ensuring
Methodology comparability of responses. The questionnaire
is titled “Corporate Culture and Employee Job
The term methodology is a system of explicit Performance Questionnaire.” However, only 78
rules and procedures in which research is based out of 100 respondents returned their questionnaire
and against which claims of knowledge are and were used for final analysis in this study.
evaluated (Ojo, 2003). Therefore, this section One important way of ensuring that we have
focuses on the research techniques adopted and used the right instrument and have taken correct
used for this study with the aim of achieving the measurement is that our outcome must be in
research objectives. consonance with two major criteria for measuring
In this study, survey research design is adopted. quality known as validity and reliability (Ojo,
Survey research design was chosen because 2003).
the sampled elements and the variables that are To ensure the validity and reliability of the
being studied are simply being observed as they questionnaire used for the study, even number of
are without making any attempt to control or experts were consulted to look at the questionnaire
manipulate them. items in relation to its ability to achieve the stated
The theoretical population of the study consists objectives of the research, level of coverage,
of the entire workers of the banks in Lagos State, comprehensibility, logicality and suitability for
Nigeria. The choice of Lagos State stems from prospective respondents. A pilot test which took
the fact that the Headquarter Offices of Nigerian the form of test-retest method was conducted at
banks are located in Lagos State and that there is the branches of selected banks in Sango-Ota, Ogun
concentration of banks in Lagos State with over State where 10 workers from each of the bank
25 percent of the branches of these banks in Lagos branches were selected using purposive random
State alone. For effective coverage and lower cost, sampling technique. The choice of Sango-Ota
stratified sampling technique was used to select for the pilot study was informed by the fact that
the participating banks. Nigerian banks were it is the city where the researcher is living with
stratified into two strata based on the year they a fair concentration of the branches of the banks
were established. Thus we have ‘old’ generation studied.
banks and ‘new’ generation banks. Two banks Data collected from the questionnaire were
were selected from each stratum. Employees analysed, summarised, and interpreted accordingly
in selected banks were divided into three strata: with the aid of descriptive statistical techniques
management staff, senior staff, and junior staff. A such as total score and simple percentage. Chi-
simple random sampling technique was used to square was used to measure the discrepancies
select a total of 100 employees that constituted our existing between the observed and expected
sample size. It should be pointed out that limited frequency and to proof the level of significance in
financial resources at the researcher’s disposal testing stated hypotheses.
in the organization for 16-20yrs and 9.0% of the Total 78 100.0 100.0
respondents have worked in the organization for
11-15yrs. Source: Field Survey, 2008
From the table above, we can see that 48.7% of Table 8: Any Positive Relationship Between
the respondents strongly agree that organizational Organisational Culture and Organisational
culture determines the productivity level of the Productivity?
organization and then followed by 44.9% of There is a positive relationship between organizational
the respondents who also agree, 5.1% of the of culture and organizational productivity
Cumula-
the respondents are undecided and 1.3% of the
Fre- Valid Per- tive Per-
respondents only disagree that organizational quency Percent cent cent
culture determines the productivity level of the Valid Strongly
3 3.8 3.8 3.8
organization. Disagree
Disagree 6 7.7 7.7 11.5
In this study, the researcher also sought to
Undecided 6 7.7 7.7 19.2
know the respondents view on if there is a positive
Agree 40 51.3 51.3 70.5
relationship between organizational culture and Strongly
employee job performance. Their responses are Agree
23 29.5 29.5 100.0
(i) A large number of respondents (57.7%) culture in order to improve their employees’ job
strongly agree that corporate culture has effect performance.
on employee job performance. Every individual has different culture and
(ii) 48.7% of the employees also agree that beliefs that he works with and when he joins an
corporate culture determines the productivity organization that has a completely different culture
level of the organization. and beliefs from his own, he should be allowed
(iii) This study further reveals that there is a to internalize himself first with the organization’s
positive relationship between corporate culture and values to know whether he can cope
culture and employee job performance. This with them or not. It is the ability of the employee
is evidenced in the first hypothesis tested in to cope with the organizations culture that will
which the calculated value of chi-square 56.23 determine how he will perform on his job.
is greater than the tabulated value of 9.488. In cases where an organizational culture must
(iv) There is also a positive relationship between be changed, employees must first of all be notified
organizational culture and corporate culture and made to learn the modification of the old
and organizational productivity. This also culture as this will affect their performance.
came from the second hypothesis in which the Organizational culture of must be binding on
calculated value of chi-square 63.67 is greater all member and staff of the company as this will
than the tabulated value of 9.488 which made encourage uniformity among members of the
us to accept alternative hypothesis two and organization and thus enhance commitment and
reject null hypothesis two. group efficiency.
Conclusion
References
In this study, the researcher tried to look at
the impact of corporate culture on employee job Cascio, W. F. (2006) Managing Human Resources:
performance with evidence from Nigerian banking Productivity, Quality of Life, Profits. McGraw-
industry. Hill Irwin.
Questionnaires were administered to
respondents who were randomly selected from Denison, D.R. and A.K. Mishra (1995) Toward
sampled banks to find out their opinions and views a Theory of Organizational Culture and
on whether corporate culture has an impact on Effectiveness, Organization Science, 6 (2), pp.
employee job performance. 204-223
What we deduced from this study is that
corporate culture is very important in every Devis, L. (2007) Organizational Culture
organization and that it has positive impact on and its Importance, http://www.
employee job performance. Besides, corporate organizationalculturecenter.com/ Accessed on
culture affects the level of organisational 3rd January, 2009.
productivity in a positive way.
This study shows that there is a positive Forehand, G. A. & B. von Gilmer, (1964)
relationship between organizational culture and Environmental Variations in Studies of
employee job performance. Organizational Behaviour, Psychological
Bulletin, 62, pp. 361-382.
Recommendations
Hallett, T. (2003) Symbolic Power and
The following recommendations are made to Organizational Culture, Sociological Theory,
the management of case study banks and other Vol. 21, No. 2. pp. 128-149.
organizations that are interested in modifying their