Impact of Organizational Culture on Company Performance

ABSTRACT

This study focuses the three key attributes which build the organizational culture to generate sustainable competitive edge in market. Prior research findings support that some firms have these attributes in their organizational culture; therefore cultures based on these attributes can be source of competitive advantage. Firms those don’t have these attributes, performance of their employees might be effected adversely or ultimately these organizations are unable to achieve sustained competitive advantage.

AIMS & OBJECTIVES

Academic researchers and professional researchers’ shown interest in corporate culture and organizational performance from since last four decades. Organizational culture is considered as rich research area many researchers already made their contribution, but there is still no acceptable causal relationship among organizational culture and financial performance. Eventhough there is still no clear depiction, how organizational culture have an effect on employee performance and organiztinoal performance. Due to these contradictory matter, the research question arises, whether organizational culture worsens or imporve the employee performance is being undertaken in this study.

• Review the cultural circumstances being faced by the organization.
• To highlight the apparent causes leading to cultural impact inside and outside of the organization.
• To evaluate the various techniques and methodologies being adopted by the organizations to manage employees performance.
• To highlight the problems and discrepancies in the strategies utilized by the organizations for the purpose of managing work performance.

In order to achieve these objectives, these research questions has been asked;

• Does the organizational culture have impact on organizational performance?
• Does the organizational culture impact on job performance?
• Whether organizational culture facilitate organizational performance for the accomplishment of sustainable competitive advantage?

BACKGROUND

As due to the concept of globalization, whole world businesses are becoming the conscious and try to develop the organizational strategies and policies to make them competitive to attain the top position in this competitive business environment. It has been admitted in current era all over the world, employees are imitable assets for organizations, and success or failure depends upon the them (Polanyi, 1962). Organizations are required to opt the plans and strategies or design the organizational structures and framework that facilitate, to employees utilize their skills for organizational common objectives. Organizational culture is critical key component, organizational structure, policies and practices are always based on the organizational culture. Current era organizations are required to sustain their culture which facilitates employees for attainment of organizational common goals which will be finally organizational financial performance or competitive advantage (Barney, 1986).

RESEARCH DOMAIN

I got excellent opportunity in form of research project based on great support or guidelines from kind supervisor to produce research based project on “Organizational Culture: a source of competitive advantage with mediating role or employee performance”. In this kind of coarse grained research study, we focus on components of organizational culture, and how organizational culture facilitates towards achievement of sustainable competitive advantage in this competing business global village, and whether organizational culture make something worse or improve the employees’ performance at work place. (Grant, 2002 , Schein, 1984 , Barney, 1995 , Wright et al., 1994) few renowned but different academics and professional researchers furnish a focus on study of organizational culture in different manners which facilitates the organizations to manage, culture according to their organizational strategies which are based organizational vision & Mission statement.

THEORY

Culture is always defined in a set of different figures which influence the individual employees’ behaved in different societies and their expectations are based on their implied rules which are unwritten, by most of organizational employees (Bose, 2004). According to (Lu et al., 2008) organizational culture always developed through external factors of the whole industry and internal factors of organizational background. As organizational employees have different cultural environment, backgrounds, organizational cultural should be strong in such a way when fresh employee joins organization, he might have an effect on organizational culture in accordance to its position. According to (Hofstede et al., 1990 , Trice and Beyer, 1984) organizational culture and financial performance is one of the easier said than done concept in current business environment, abundant arguments and theories has been given in literature with reference to our ability to measure or observe it. As Schein (1990) has argued, organizational culture study must opt an methodical approach that facilitates the researchers and professionals to identify and implementation of those variables and dimensions those are acquiescent for emperical and hypothesis testing. However, any sort of discussion for the determination of parameters for organizational culture and organizational financial performance which leads towards sustainable competitve advantage.

In adding together, porposed theories in literature often become problematical when these are endeavor to theoratical framework the actual richness and detail of organizations complexity and interrelationships between organizational financial performance and organizational culture. We believe the research methodology used in this study can avoid many of the pitfalls associated with previous research on organizational culture, employee performance and competitive advantage. Consistent with ( Schein, 1985 ), our goal is to begin to develop a “roadmap” that suggests possible relationships among variables comprising organizational culture and to estimate their relative effects on organizational performance for the attainment of sustainable competitive advantage. Hence, implications of research studies on corporate culture have facing some degree of limitation to unfolding why and how organizations enjoying sustainable competitive edge in corporate world as compare to average or normal organizations. Cultural studies was not used to elaborate, why firms are unable to attain competitve advantage, or how lower level or avarage firms can used these studies, to modify their organizational level cultures, to enjoy competitive position.

RESEARCH METHODOLOGY

This research study is specifically based on literature & theoretical discussion and the research Approach opted in this one of kind study is diagnostic in nature, which identifies the relationship of organizational culture and sustainable competitive advantage through sustainable financial & economic performance and to predict the performance of employee. In order to specify the procedures and methodologies for collection and analysis of the data a master plan is used known as “Research Methodology”. Series of rational decision making alternatives are being presented in the research methodology. These alternatives depend upon a range of available options to the researchers. The unit of analysis, time dimension, and purpose of the study, data processing, sampling design, and analysis of the data are presented in the research methodology. Mainly two techniques of research, Qualitative and quantitative are utilized. Different organizational cultural theories has been studies given by different professional & academicians researchers to study the organizational environment ( Allaire and Firsirotu, 1984 , Ouchi and Wilkins, 1985 , Strinati, 2004 ).

PROBLEM STATEMENT

Organizational Culture always play critical role in organizational performance to achieve the sustainable competitive advantage in the current global business era. Organizational management having a foremost interest in organizational financial performance. In current study we are trying to focus on the components of organizational culture to achieve the sustainable competitive advantage, with the mediating role of employee performance. In current business world, culture is considered key factor in organizational survival and performance, especially cultural issues are faced by multinational organizations or in industrilized countries. It is deem as hot issue for top level management to manage the organizational culture for accomplishment the organizational common objectives and to achieve the sustainable competitive advantage or market leader position.

This study will examines the liaison among organizational culture, employee performance and sustainable competitive advantage. conditions or circumstances under those organization’s culture can be used as competitive advantage, hence by implications, a sustainable financial performance or competitive edge are examined (Hirshleifer, 1980). Study will proceeds as;

PROJECT PLAN

Introduction phase will explain the fundamental concepts of study and elaborate the key points in detail, relationships among the variables and proposed research aspect will be discussed in detail.

At the of introduction phase future research guidance will be elaborate in systematic way. In sub point to introduction of study, aims & objectives of current study will be comprehensiblly discussed, in the next point research questions will be recommended for proposed research study.

In Second phase, detailed literature review will be discused and word of professional and acdamic researchers will be acknowledged with appropriate style of referecing.

In third phase proposed model for current study will be discussed in detail and proposed variables should be given with theoratical justification, proposed model should be elaborated in economatric formula form.

In Fourth Phase discussion & conclusion will be given with the support of research outcome, suggestions and practical implementations of study will also be discussed in this phase.

In the last phase of study research limitations and recommendations will be converse in detail. In broad way study will come to grips with following points first, some of the key concepts used in this analysis are defined.

Second, the attributes that a firm’s culture must have in order to be a source of sustained superior financial performance and competitive advantage are discussed.

Third, the organizational cultures of at least some firms are examined to see if they meet these criteria.

Finally, whether or not firms that do not currently have organizational cultures that are a source of this level of performance can engage in managerial actions to develop such cultures is considered.

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