Organizational Culture and Managerial Characteristics Effects on Work Performance

Purpose – Literature has studied the variables of organization culture and managerial characteristics separately in various dimensions. This study investigates the effects of organizational culture and managerial characteristic on the tradeoff between organizational sincerity and work performance for promotion.

Design/methodology/approach – The data was collected using self-administered questionnaire, from managers of different departments. The final sample size was 250 managers.

Findings – The result showed that there is a positive relation between organizational culture, work performance, and organizational sincerity. A positive association also exists between managers education level and work performance given that the gender is male.

Research limitations/implications – Few limitations would be the shortage of time and resources. In future studies other managerial characteristics should also be examined.

Practical implications – In this era of immense competition, companies may ask themselves what to criteria to choose while promoting employees. Result shows that there is a positive relation between organization’s culture, work performance, and organizational sincerity.

Originality/value – The most interesting and significant finding is that there is a positive relation between organizational culture, work performance, and organizational sincerity. Accordingly the stronger the culture of the organization the better work performers and sincere employees it has.

Keywords - Organizational culture, Managerial characteristics, Work Performance, Sincerity

CHAPTER 1: INTRODUCTION

Overview

It has been argued that loyal and sincere employees are very important for success of organizations (Jaunch, Glueck, & Osborn, 1978). It is said that coherent and carefully developed corporate values play an important role, in making employees, loyal to organizations (Smith & Rupp, 2002).

Work performance has been studied in different dimensions. Earlier the study of work performance was limited only to job satisfaction (Martin & Shore, 1978). Ovadje, Obinna and Muogboh (2009) also studied the relation between job satisfaction and individual performance, according to their study the relationship between the two was high and consistent. Jaunch, Glueck and Osborn (1978) have argued that loyalty has no relationship with work efficiency. They used five point scales to measure organizational sincerity, commitment and productivity. Avolio, Waldman, and McDaniel (1990) studied the effect of age and experience on work performance and concluded that experience is a better predictor of performance than age.

It is argued that health of organizations depends upon health of employees, if employees are healthy they will perform better and organizations will grow (Baptiste, 2008).

Paswan,Pelton and True (2005) studied perception of managerial sincerity in context of motivation and job satisfaction, they concluded that loyalty of employees is very important in getting good feedback as they are employees are more interactive and motivated. The relationship between employees and organization depends upon how they perceive the organization (Martin & Shore, 1989). Baffour (1999) also argues that organizations in which employees are part of decision making perform better than those with centralized decision making. Employee’s loyalty may lead to employees’ satisfaction and productivity or it may result in dissatisfaction and absenteeism (Becker, Billings, Eveleth & Gilbert, 1996). Previously supervisory ratings and questionnaire have been used to measure organizational sincerity and work performance respectively (Jaunch et al, 1978). It is argued that participative management makes employees satisfied (Kim, 2002).

Therefore loyalty and sincerity of employees to organization is considered as an important factor in promotions (Jaunch et al, 1978). It is also said that quality has relationship with satisfaction (Ilias, Rahman & Razak, 2008).

Barney (1986) argued that that firms which do not have the required cultures cannot sustain optimal financial performance because their respective cultures are neither rare nor difficult to imitate.

Weick (1987) also argued that organizations whose cultures value reliability more than efficiency often face unique problems in learning and understanding, which could affect the performance of the organization.

It is argued that top management involvement is very essential to handle strategic change efficiently and effectively (Boecker, 1997). Gupta and Govindarajan (1984) also argued that tolerance of mangers contribute positively make business unit more efficient

Although work performance is studied by different researchers in different dimensions, but no one has tried to link organizational sincerity to work performance. This study aims to identify the interrelation of work performance and organizational sincerity. Today in the world of immense competition both traits of sincerity and hard working in an employee is hard to find. Through this study we want to find whether a manager will prefer an employee who is hard worker or an employee who is sincere towards his organization.

Problem Statement

To study the effects of managerial characteristics and organizational culture on managers trade-off between organizational sincerity and work performance for employee promotion.

Proposed Research Hypotheses

H1: There is a relationship between managerial characteristics and promotion criterion due to organizational sincerity.

H2: There is a relationship between managerial characteristics and promotion criterion due to work performance.

H3: There is a relationship between organizational culture and promotion criterion due to organizational sincerity.

H4 : There is a relationship between organizational culture and promotion criterion due to work performance.

H5: There is a relationship between managers’ education and work performance due to male gender.

H6: There is a relationship between managers’ education and work performance due to female gender.

Outline of the Study

Chapter one includes the an overview of variables, problem statement that shows the possible relationship between managerial characteristics, work performance and impact of both on promotion criterion and six proposed research hypotheses with a brief outline of the study. Chapter two includes the literature review. In this chapter organizational culture, organizational sincerity and work performance are explained. Chapter three is comprised of method of data collection which is personal survey, sampling technique which is non-probability convenient sampling ,size which is two hundred and fifty, instrument of data collection, research model developed which supports the problem statement and statistical technique which is correlation. Chapter four includes the results which show the relationships between variables. Lastly Chapter five includes conclusion, discussions, implications and possible future researches.

CHAPTER 2: LITERATURE REVIEW

The labor markets are becoming competitive day by day and it is very rare to find an employee that performs efficiently and whose goals are compatible with those of organizations. Therefore, most of times managers have to choose between a loyal employee and an efficient employee. Several factors influence this phenomenon.

Culture

It has been argued that there are considerable differences in the attitudes of managers as well as employees in the geographically and historically similar countries. These differences have been found across such variables as control, supervision, commitment, and decision type and leadership style. It was further revealed that these differences in the attitudes of managers and employees was associated with their respective country’s position on the Hofstede’s cultural dimensions.(Mockaitis, 2005).

Glinow, Huo and Lowe argued that despite numerous researches conducted on International Management styles, the studies have still failed to illustrate how ideal leadership or management style is affected by the specific cultural characteristics in different countries. They argued that although multinational firms should maintain some form of consistency in terms of management style, yet the management style used overseas (in different cultures) should be enfused with the local culture to maintain acceptability within the cultural context.

Ralston, Holt, Terpstra and Cheng argued that economic ideology and national culture has a deep impact on individual work values of managers.

Barney argues that organizational culture can be a source of sustained competitive advantage. He argued that some organizations have developed a culture which provides means to achieve competitive advantage.

Schein argued that organizational culture has profound effects on its survival. He stated that an organization cannot survive if it cannot manage itself as an organized one through the use of deeply entrenched culture. He further argued that organizational culture brings in stability and thus it must be instilled into the new members.

Schein argued in another paper that culture needs to be understood thoroughly and analyzed if an organization intends to take advantage of it in the field of organizational psychology.

Denison and Mishra argued that there was a relationship between organizational culture and effectiveness. According to them organizational culture can be measured and can be related to critical organizational outcomes.

Chatman and Jehn argued that the use of organizational culture to attain competitive advantage may not bear as much fruit as some scholars have argued it to be. They argued that there may be some constraints in the way to achieving this competitive advantage by using organizational culture.

According to Sheridan (1992), organizational culture and employee retention are related. His study showed that the differences in employees’ cultural values and the organizational values resulted in significant cases where employees deliberately left their jobs indicating that cultural fit is imperative to job retention for the organizations.

Gordan & DiTomaso (1992) argued that a strong organizational culture is positively associated with better performance. Their research also concluded that a strong culture lends itself to a short-term performance hike.

Organizational Sincerity

Loyalty is directly related to corporate vision, mission and values. As the business world is multifaceted therefore approach should be chosen with great care to analyse the gap between promise and performance gap (Fassin & Buelens, 2011).

Managers’ role in encouraging employees, giving them feedback regarding their performance and guiding leading them towards right career is very important. When employees are motivated because of management support they deliver quality sevice. Except of that employees whose goals are compatible with those of organizations are more productive and enthusiastic (Paswan, Pelton and True).

Ali and Kazemi (1993) argue that loyal employee are real assets of an organization because they are those who do not quit in rainy days and stand by the organization as they own the problems of organization. Furthermore they say that sincere employees are more productive and are punctual.

In case of loyalty, in US skills are preferred on seniority and seniority is not as important promotion criterion as skills are. While in Japan seniority is most important to be qualified as leader. But in Taiwan connections with owners are also valued along with seniority as important criteria to be qualified as leader (Glinow,Huo & Lowe,1999).

In US mangers are considered more competent than employees therefore speaking skills are important criteria to be promoted as leader and leaders tend to be good speakers to communicate corporate vision. While Japanese believe in equality and homogeneity of human talent therefore subordinates’ input is considered very important. Taiwan is hybrid of both (Glinow et al, 1999).

In US a leader needs to develop specialized skills to be promoted as leader while in Japan to be a leader one needs to possess broad-cope skills and experience. In Taiwan both, specialized skills and broad-scope skills with experience are important criteria to be an effective leader (Glinow et al, 1999).

Chen and Tjosvold (2006) have argued that to strengthen the relationship between employees must tbe cooperative and not the competitive especially when mangers are from different countries.

Work Performance

There is a noteworthy impact of HRM practices that a company adopts on the wellbeing and positive performance of employees (Baptiste, 2007).

Performance can be improved by employee participation and flexibility in job design.

(Gershenfeld, 1988; Jaikumar, 1986).

Managers should encourage employee participation and flexible structures to enhance the performance. Firms that are changing their traditional rigid organizational structure and bringing flexibility in work design are able to improve their performance and output quality (Baffour, 1999).

Age and experience have non linear relationship with performance. Experience, rather than age, is a better predictor of performance ( Avolio, Waldman & McDaniel, 1990)

Blumberg and Pringle (1982) emphasized a model of work performance which says that performance is a result of ability motivation and opportunity.

It is argued that health of organizations is directly influenced by health of employees, if employees are healthy they will perform better and organizations will grow and become healthy (Baptiste, 2008).

Gillespie and Mann (2004) and Dirks and Ferrin (2002) have argued that trust is an important feature in the relationship that leaders have with their subordinates and that it is through this subordinate trust and respect for their leader, that subordinates are motivated to perform well. This view is supported by Bijlsma and Koopma (2003) who claim that trust is an important factor to organizational performance, because it facilitates discretionary effort to assist the organization.

Standing (1997) argues that the critical areas of labor insecurity that should be considered as they effect work performance are those that relate to income insecurity (unsteady earnings or where earnings are contingency-based), working time insecurity (irregular hours at the discretion of the employer, and insufficient hours worked) and representation insecurity (where the employee has limited power to negotiate or participate).

Design and physical properties of work place can have negative or positive effect on work performance of employees. A greater environment innovative work settings, a greater task performance in innovative work settings and a greater interaction with innovative work settings are associated with greater satisfaction and enhanced productivity (Ilozer, 2002)

According to Armstrong (2000), performance management is a way of getting better results from the whole organization or individuals within it, by understanding and managing performance within an agreed framework of predetermined goals, standards and competence requirements. According to Walters (1995), performance management is about guiding and supporting employees to work as effectively and efficiently as possible according to the goals of the organization.

A drug-free workplace helps to enhance output and performance and lowers the chance of injury. Many companies feel testing employees has helped to bring about lower costs, lower absenteeism, and lower medical costs (Bacon, 1989).

CHAPTER 3: RESEARCH METHODS

Method of Data Collection

As our research study is descriptive and sources of information are primary, therefore we have used personal type of survey to collect the data. First of all data collection process was planned properly and then instrument was developed accordingly. After the development of instrument, pilot testing was done. Lastly actual data was collected and compiled. To collect the data through questionnaire we approached managers of different organization and used snow ball technique.

Sampling Technique

As the number of elements is unknown, we have used Non-probability sampling technique. To collect data in proper and convenient way, Convience sampling is used. The managers are easily accessible so it is most beneficial of all other sampling techniques.

First of all the population was defined, and then sampling frame was determined. After determination of sampling frame, sampling technique was decided. Once the technique is decided, sample size was decided too. At last, the sampling process was executed.

Sample Size

The proposed number of respondents is two hundred and fifty (250).

Instrument of Data Collection

To study the effects of managerial characteristics and organizational culture on manager’s trade-off between organizational sincerity and work performance for employee production, a questionnaire is developed comprising of nine questions.

First question is about the work practices of mangers and their individualistic approach towards the work and how they perceive and conceive it. This question is further divided in ten questions in order to become more specific. Second question, which is further subdivided into twenty questions, is about the organizational culture. The number of questions is higher as compare to previous one because culture is more descriptive and a lot of information is required to comprehend it. Third question is about gender. It will tell us that whether gender makes any difference in giving promotion either to an efficient or loyal employee. Question four is about the age. It will also help us to see whether attitudes and beliefs regarding loyalty and efficiency change with respect to age. Fifth and sixth questions are about employee experience with current organization and overall experience respectively.

The seventh and eighth questions education and functional department is asked from respondents. It will enable us to comment whether perception of employee importance as education level and department change.

Ninth and last question regarding name is optional because we are studying role of managers in promoting efficient or loyal employees impartially and irrespective of name, caste or color.

In short the questionnaire was designed to collect about employees work practices, the culture of organization they work in and the managerial characteristics.

Validity and Reliability test

The instrument used here is valid and reliable. Because it is specifically designed to collect data specifically required to study the effects of managerial characteristics and organizational culture on managers’ trade-off between organizational sincerity and work performance for employee promotion.

To check the validity and reliability of instrument we did pilot testing and found the instrument valid and reliable in accordance with our study.

Therefore data collected through this instrument is also valid and reliable and leads us to more useful and specific results.

Research Model Developed

Figure 3.1

Managerial Characteristic

Organizational Sincerity

Work Performance

Organizational Culture

Organizational management has to deal with different types of employees. Some are very hardworking and efficient while others are very loyal to the organizations. It is of great importance to an organization to understand the relationship between the organizational sincerity and work in order to grow, compete and even survive.

Statistical Technique

Correlation will be used for data analysis. We have used correlation because it is the statistical technique which enables us to understand and interpret the interdependence between organizational sincerity and work performance for employee performance.

CHAPTER 4: RESULTS

Table 4.1

Promotion criteria

Managerial

characteristics &

Organizational culture

Organizational Sincerity

Work Performance

Age (Male)

.055

(.404)

-0.13

(.837)

Age (Female)

.226

(.418)

-.170

(.546)

Working Experience With Current Organization (Male)

.058

(.376)

.077

(.238)

Working Experience With Current Organization (Female)

.262

(.346)

-.025

(.930)

Overall Working Experience (Male)

-0.19

(.768)

.049

(.455)

Overall Working Experience (Female)

.269

(.333)

-.239

(.390)

Education Level (Male)

-0.25

(.706)

.117*

(.073)

Education Level (Female)

.107

(.704)

.314

(.254)

Organizational Culture

.395**

(.000)

.299**

(.000)

*, Correlation is significant at the 0.10 level (2-tailed).

**. Correlation is significant at the 0.01 level (2-tailed).

P value is written in parenthesis.

All the Managerial characteristics except for Education Level of Male are insignificant as their P value > α. A positive relation is shown between organizational culture, organizational sincerity, and work performance having P-value < α, which makes them significant.

CHAPTER 5: CONCLUSION, DISCUSSIONS, IMPLICATIONS AND FUTURE RESEARCH

Conclusion

Data analysis shows that there is no relation between managerial characteristics and organizational sincerity for both the genders, male and female. But in case of managerial characteristics and work performance, a relationship is established between managers’ education level and work performance but only for male gender. For female gender no such relationship exists.

Analysis also shows that organizational culture is positively related to organizational sincerity and work performance. That suggest that stronger the organizational culture, better the wok performance and sincerity.

Discussions, Implications and Future Research

Organizational culture, sincerity and work performance are very important and crucial towards the achievement of organizational goals. Therefore work performance has been studied in relation to job satisfaction and consistent relations are established. But few attempts are made to find out the impact of organizational culture on achievement of organizational goals which is dependent upon work performance which leads to greater output and organizational sincerity.

As we have found out a positive relationship between organizational culture and sincerity and between that of organizational culture and work performance. We can say that organizations in order to improve performance and build stronger relationship with their employees should work on building stronger and compatible organizational culture. It will not only improve employees’ productivity but employee turnover will also reduce which will save the training costs et cetera ultimately. Except of that competencies and skills which are developed in employees over a period of time can also be retained and even competitive advantage can be achieved on basis of it.

Even though we have studied very important relationships among managerial characteristics, organizational culture, organizational sincerity and work performance, a lot needs to be done in this newly identified direction.

In this unexplored direction and field of study researchers can study many variables like impact of organizational culture on conflict of interest and can enhance the understanding further.

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