The Importance Of Organizational Culture In Business: A Literature Review

Linking organizational structure strategy

Defining Organizational Culture

Discuss About The Linking Organizational Structure Strategy.

The main objective of this literature is to demonstrate the relationship between two variables culture and business. The paper also explains the benefits of strong and dynamic culture in the workplace. It describes that how the firm can maintain a positive culture within the organization. The strong and unique culture can increase the productivity towards attaining the overall organization goals and objectives.

Culture plays an empirical role in each and every company to conduct the business activities and operations successfully and effectively.  Zheng, Yang, and McLean (2010) define that culture includes habits, symbols, assumptions, languages, values, beliefs, and norms. The culture is the way through which things are done effectively. It is argued by Linnenluecke and Griffiths (2010)  where they define that culture is the arts and other manifestations of human intellectual achievement regarded collectively ideas, customs, and social behavior. Culture includes the activities of arts and philosophy that are important to accomplish the goals and objectives. Çakar and Ertürk (2010) argued that culture refers to a specific set of routine, morals, codes, beliefs, values, and traditions from a particular time and place. In addition, culture may be defined as a high degree of tastes, knowledge, literature, and interest in arts and other scholarly fields. In other words, culture is a way of thinking, material objectives, and the way of acting that together shape a people’s way of life. The organizational culture plays a fundamental role to determine the roles and responsibilities of the employees in the workplace. It shall be analyzed by Tseng (2010) where he defined that organizational culture is an underlying belief, values, customs, attitudes, assumptions, and ways of interacting that participate to the dynamic social and psychological environment of the firm. The organizational culture is civilization in the workplace. Hu et al (2012) suggested that organizational culture may be defined as philosophies, values, customs, behaviors, attitudes, and practices that define the image of the company.  Zheng, Yang, and McLean (2010) suggested that organizational performance and productivity can be improved and enhanced by strong shared values and culture. The organizational culture also boosts and develops the morale, confidence, and loyalty among the team members at the workplace. Naranjo-Valencia, Jiménez-Jiménez, and Sanz-Valle (2016) stated that culture must evolve and develop for the firm to stay in a changing and dynamic environment. Furthermore, encouraging and motivating employees helps to create a healthy and favorable culture. Training and development coaching is provided to all workers to help them understand and identify the new processes, systems, and expectations. It has been analyzed that organizational culture is the common and effective value of the firm which develops and boosts an understanding of both the company’s constraints and opportunities. Furthermore, culture can be initiated to attain internal control and gain competitive benefits in the marketplace. The strong and dynamic culture is originated of habits, values and working beliefs. The Hofstede cross-cultural model is developed by Hofstede to avert and reduce the issues and hurdles related to the workplace and culture. He distinguished one company from another and indicated the features and aspects of the firm. O’Reilly III et al (2014) argued that organizational culture is a collection of beliefs, values, customs, and norms shared by its group members and reflected the company’s goals and practices. This culture also facilitates the innovation in order to trigger the desires and needs for the members within the organization. It has been evaluated that culture and norms of the organization play a critical role towards the efficiency and productivity of the company which is necessary to generate a competitive edge in the challenging world. The main of the firm behind the maintaining of favorable culture in the workplace is to enhance the financial and management productivity of the organization. Osland, Devine, and Turner (2015) indicate that strong and heavy culture also can eliminate and reduce the cost of decision making. The organization can get a great and high return if they maintain a unique and strong culture in the workplace. The firm that does not propagate the culture and values always get less revenue and return. On the other hand, effective management of diversity is based on the identification of commodities and awareness of the differences. Managing and handling the cultural diversity includes the identifying the best practices. Organizational culture is affected in the way that employees in the firm perform tasks and duties, set goals and administer resources in order to achieve the objectives. Culture also influences the recruitment and selection process of HRM. If the organization maintains a strong culture at the workplace then it will help to attract more applicants in the organization. As a result, the company can utilize the resources and capital with the help of the potential team.  It has been noted by Kuipers et al (2014) where they observed that culture is also associated with leadership. If the leadership is strong and leaders use dynamic leadership styles in the organization then it will help to promote the strong culture in the workplace. This culture is more important for every company to increase the number of consumers in the marketplace. Culture is a vital component in both strategy implementation and strategy creation. The leaders may deal with various obstacles and issues that are raised in the organization by maintaining a unique culture (Barak, 2016). Strong and heavy organizational culture helps to fulfill the needs, demands, and requirements of the customers in the marketplace. The corporate culture makes the formation features of the organization, this one improve and enhance the visibility of the firm and competitive strength. It is also based on the customer’s trust and loyalty. So the company’s culture needs to be shown, the show will help increase and enhance the visibility of the firm and encourage the firm competition ability. For example, Wal-Mart maintains very excellent culture in the workplace (Jonsen, Maznevski and Schneider, 2011). The unique and dynamic culture also influences the CSR practices and sustainability in the organization. It will help to retain the more clients within the organization. It also affects the risk direction of strategic decisions. It has been evaluated that employee’s behavior in the organization is affected by three different cultures such as national, occupational and organizational culture. Along with this, organizational culture encompasses a set of routines, structures, rules, norms, and values that constrain and assist the behavior of people (Ang and Van Dyne, 2015).

The Role of Organizational Culture in Workplace Productivity

There are various factors affect the culture of the firm include age, sex, gender, religious and custom. Furthermore, job contentment is one of the significant variables in the managerial culture and behavior. The job satisfaction is also influenced by several external and internal factors such as principles, values, personality, expectations, and norms. It has been measured that managerial culture can be promoted and motivated to assist the attainment of organizational goals and job satisfaction (Lynch, 2017). It is noted that a well developed and strong company culture, can be a powerful recruiting point in the organization. High morale and loyalty is a key to success and growth. It is closely related to faith, purpose, team loyalty, and trust in the leadership. Therefore, all these qualities are needed to improve and enhance the culture of the firm. It is observed that supply chain efficiency is also dependent on the corporate culture and efficiency of the employees. The culture improves and enhances the cooperation and coordination among the team members. The supply chain becomes more effective and efficient with the help of dynamic culture (Ang and Van Dyne, 2015).

As the culture builds and develops, managers and leaders learn to better handle the quality of everyone’s experience inside the organization and with outsiders includes clients, suppliers, customers and other entities. In this way, the organizational has been able to provide a unique quality of products and services to the consumers by initiating the strong and heavy corporate culture. A well developed and strong culture helps to accept the challenges and organizational changes within the organization. Leadership also plays a heavy role to attract and inspire the workforce for doing work effectively and successfully. Leadership is significant in maintaining and codifying an organizational principle, standards, and vision of the firm. Leaders set the examples by living the factors of culture such as behaviors, procedures, actions, and values. Values are worthless without other factors. It is essential that workers at all levels in the union notice and validate the factors of culture. The companies with codified and strong cultures enjoy great customer and employee loyalty. It has been analyzed by Linnenluecke and Griffiths (2010) that culture is one of the significant factors that determine the success of the company. If the company develops and boosts an effective culture at the workplace, then the organization has been able to eliminate and avert the absenteeism within the organization. A strong and unique culture moves away from the adversarial relationships and towards the coordination. Cooperative and reciprocal relationship creates few grievances and issues in the workplace. In this way, strong and unique culture offers enormous benefits for the company as well as business. This culture also helps to know and understand the customs and religious of different countries in the world. It shall be stated that safe and secure workplace with fewer injuries and claims increases and enhances the outcomes of the Corporation.  Due to poor culture, various issues can arise at the workplace that can affect the sustainability and position of the firm negatively. One of the significant issues that occurred due to lack of culture is language that can influence the operations and activities of the firm. As a result, the employees are unable to understand the languages of different cultures. Misunderstandings between employee and employer also arise in the workplace due to the poor and ineffective culture within the organization. In addition, employees are failed to maintain strong communication in the workplace as it influences the efficiency and productivity of the followers (Linnenluecke and Griffiths, 2010).  A big issue with a poor cultural fit at the work is stress that affecting a large number of areas in the employee’s life. It should be analyzed by Ang and Van Dyne (2015) that a good and strong culture fit for the employees to reduce the stress and anxiety of the workers. It also reduces poor performance and turnover of the employees. To overcome the cultural issues, Hofstede cross-cultural model has been initiated by Hofstede. This model explains the interaction between national culture and organizational culture. This model reduces the conflicts and barriers of the workers that are raised in the workplace. The Hofstede cross-cultural model includes the 6 dimension such as power distance index, masculinity versus femininity, individualism versus collectivism, pragmatic versus normative and indulgence versus restraint (Naranjo-Valencia,  Jiménez-Jiménez, and Sanz-Valle, 2016).

How Organizational Culture Affects Recruitment and Selection

It shall be noted that employees take full roles and responsibilities in the workplace if the firm maintains a unique culture in the organization.  In a safe workplace, the workers are able to speak freely and openly without any hesitation (Zheng, Yang, and McLean, 2010). The leaders and managers always try to improve and enhance the safety standards and norms within the organization (Bird and Mendenhall, 2016). Moreover, employee retention can be done by initiating the safe and secure workplace. Profitability and productivity rise at the organization with strong and dynamic cultures. A well-developed culture determines the brand of the firm. On the other hand, it has been noted by Tseng (2010) that a strong and unique culture includes a well-defined mission, corporate values, vision that makes easy the decision-making process. With the help of unique culture, decisions will be better aligned with organizational goals and enhance the chances of attaining growth. Focusing on culture might be new and innovative task for the business. However, it is essential to cope with the rivalries in the international market. Building and developing well-developed cultures creates an enjoyable, inspiring and encouraging work environment in the workplace. This culture helps to make happy the workers and they put their efforts more to maximize the outputs of the company (Zheng, Yang, and McLean, 2010).

On the above-mentioned study, it has been concluded that organizational culture affects the performance and productivity of the workers as well as organization positively. It is effective both financial and nonfinancial measures are initiated to get more outcomes and results. The literature on organizational culture and business stated that how the companies develop their culture in an effective way. The strong culture also helps to analyze the strengths and weaknesses of the competitors.

References

Ang, S. and Van Dyne, L., 2015. Handbook of cultural intelligence. Routledge.

Barak, M.E.M., 2016. Managing diversity: Toward a globally inclusive workplace. Sage Publications.

Belias, D. and Koustelios, A., 2014. Organizational culture and job satisfaction: A review. International Review of Management and Marketing, 4(2), p.132.

Bird, A. and Mendenhall, M.E., 2016. From cross-cultural management to global leadership: Evolution and adaptation. Journal of World Business, 51(1), pp. 115-126.

Çakar, N.D. and Ertürk, A., 2010. Comparing innovation capability of small and medium?sized enterprises: examining the effects of organizational culture and empowerment. Journal of Small Business Management, 48(3), pp.325-359.

Hu, Q., Dinev, T., Hart, P. and Cooke, D., 2012. Managing employee compliance with information security policies: The critical role of top management and organizational culture. Decision Sciences, 43(4), pp.615-660.

Jonsen, K., Maznevski, M.L. and Schneider, S.C., 2011. Special review article: Diversity and its not so diverse literature: An international perspective. International Journal of Cross Cultural Management, 11(1), pp.35-62.

Kuipers, B.S., Higgs, M., Kickert, W., Tummers, L., Grandia, J. and Van der Voet, J., 2014. The management of change in public organizations: A literature review. Public administration, 92(1), pp.1-20.

Linnenluecke, M.K. and Griffiths, A., 2010. Corporate sustainability and organizational culture. Journal of world business, 45(4), pp.357-366.

Lynch, F.R., 2017. The diversity machine: The drive to change the white male workplace. Routledge.

Naranjo-Valencia, J.C., Jiménez-Jiménez, D. and Sanz-Valle, R., 2016. Studying the links between organizational culture, innovation, and performance in Spanish companies. Revista Latinoamericana de Psicología, 48(1), pp.30-41.

O’Reilly III, C.A., Caldwell, D.F., Chatman, J.A. and Doerr, B., 2014. The promise and problems of organizational culture: CEO personality, culture, and firm performance. Group & Organization Management, 39(6), pp.595-625.

Osland, J., Devine, K. and Turner, M., 2015. Organizational behavior. Wiley Encyclopedia of Management, pp.1-5.

Tseng, S.M., 2010. The correlation between organizational culture and knowledge conversion on corporate performance. Journal of knowledge management, 14(2), pp.269-284.

Zheng, W., Yang, B. and McLean, G.N., 2010. Linking organizational culture, structure, strategy, and organizational effectiveness: Mediating role of knowledge management. Journal of Business research, 63(7), pp.763-771.

Zheng, W., Yang, B. and McLean, G.N., 2010. Linking organizational culture, structure, strategy, and organizational effectiveness: Mediating role of knowledge management. Journal of Business research, 63(7), pp.763-771.