1.0 introduction
Organizational culture refers to the beliefs and behaviors that determine how an organization’s employees and management interact as well as the manner in which they handle the external business environment. It is a very important aspect of an organization in the sense that it determines the manner in which employees relate with one another; with the management and with other people outside the organization. It can also be perceived as a pattern of shared values and beliefs among employees which in turn influences the manner in which these employees behave and even perform their job related duties. An organization’s culture can either be a healthy one or an unhealthy. A healthy organizational culture promotes improved morale among employees thus improving their productivity, hence improving the overall financial performance of the company (Adler, 2008). In this paper, the researcher looks into the organizational culture and its role in an organization.
2.0 The Role of Organizational Culture in an Organization
2.1 It Influences the Performance of Employees
The organizational culture has a very significant role to play in influencing the performance of employees. A healthy organizational culture promotes good performance of employees as opposed to an unhealthy one. A healthy organizational culture is one which promotes quality day-to-day relationships between manager and employees. In an organization with such a culture, managers show genuine concern for employees, ensuring that employees are happy and contented with their jobs even as they perform them. Such organizations have happy employees who perform well in response to the concern their manager have about their welfare (Schein, 2010). It is therefore important to note that a healthy organization is one that is needed for an organization to perform well and especially when faced with competition from other companies. This is because if employees receive good treatment from their managers, they would reciprocate by putting in greater efforts to improve the financial performance of the company.
2.2 It Influences the Company’s Employee Turnover Rate
An organizational culture determines the organization’s employee turn over rate. This is because employee would be willing to continue working in an organization whose culture promotes their overall welfare. Among key issues observed by employees is the transparency of the company’s management in handling employees’ affairs; the equity with which job promotional opportunities are distributed; and the manner in which employees are treated. A company whose culture does not promote transparency and equity will be less attractive not only to potential employees but also to the current ones (Keyton, 2010). In such a company, the number of employees leaving the company would be very high because few if any employees would display willingness to continue working in such an environment for a long period of time. A high employee turn over rate is very costly to the company. This is because the cost of recruiting and training new employees is quite high. Moreover, when new employees are recruited, it takes quite some time for them to get accustomed to the company and therefore during this period of time, their level of output would be low thus affecting the company’s overall financial performance.
2.3 Its Role In Attracting High Quality Human Resource
A company’s organizational culture can either attract highly competent staff or even repel them. This is because no potential employee would wish to join a company which does not value and respect employees. Before applies for a job in a particular company, they always take time to research on the company to identify advantages of working for the company and disadvantages is any. This is the case because many employees do understand that whenever one works in a particular company, there are very many rewards to be derive from working in the company and that financial reward is just but one of the many associated with working in a particular company. Consequently, potential employees would be very keen to ensure that the company they join would not only offer them satisfactory financial rewards but would ensure that the employees non-financial needs are catered for like the desire to respected and the need to belong to a certain group(Muijen ,2000). All these needs can only be satisfied if the company has a healthy organizational culture. Such a company would be able to attract very highly talented employees because they would see that the company effectively addresses and therefore working for it would be very rewarding to them. This would in the long run lead to increased productivity and therefore improved financial performance of the company.
2.4 Its Impact On The Company’s Corporate Image
A company’s corporate image is influenced to a large extent by its organizational culture. A company with a healthy organizational culture tends to have a positive image in the public domain. This is because a company’s culture can not be hidden from any person. It would be noticed by any person who would have any transaction with the business, whether it is a creditor or a customer. It would be evident in manner in which the company’s employees treat customers and also in the manner in which the company’s management treat other stakeholders like creditors among others. If the company’s employees do not treat customers well, the company would be perceived by these employees as one with a very poor organizational culture. These customers would then spread this information among others thus painting the company’s image as none which has an unhealthy organizational culture (Muijen, 2000). This would discourage very many consumers from buying the company’s products the company’s image would have been tainted. This would in the long run negatively affect its performance as more customers shun its goods and services. Similarly, creditors among other stakeholders are noted accorded good treatment by the company’s management; chances are high that this group of stakeholders would shift its focus from trading with the company to another company which would treat them in the manner that suits their desire. This is because, when a company’s culture is unhealthy, even though one or two member of the organization displays exemplary performance, the whole image of the company would still depict its existing culture. It is therefore important for a company’s management to be at the forefront in coming with a healthy organizational culture. This can be achieved by taking measurable steps towards promoting transparency in the management of the company; promoting equity in the awarding of promotional opportunities and generally marinating a high level of respect for employees, customers among other stakeholders in the business (Schein, 2010)..
3.0 Conclusion
In conclusion, it is worth noting that organizational culture plays a very huge role in the performance of the company in several ways. This is because it influences the performance of employees in that a healthy organizational culture promotes good performance among employees who feel valued and well respected. A healthy organizational culture also reduces the employee turn over rate as more employees find themselves enjoying working in a given company. Moreover, a company with a healthy organizational culture attracts highly talented employees who eventually promote the company’s financial performance. Finally, a healthy organizational culture promotes a good corporate image of the company which improves the company’s financial performance in the long run as more customers among other stakeholders desire to engage in business with the company.
References
Adler, N.J., (2008) International Dimensions of Organizational Behavior London: Cengage Learning
Schein, E.H., (2010) Organizational Culture and Leadership West Sussex: John Wiley & Sons
Keyton, J., (2010) Communication and Organizational Culture: A Key to Understanding Work London: SAGE
Muijen et al (2000) Organizational Culture New York: Psychology Press
Alvesson, M., (2012) Understanding Organizational Culture London: SAGE
