Introduction Organizational culture has traditionally been viewed as the determining factor of the organizational success and performance. Numerous studies have concluded that the companies which promote and preserve stable organizational culture, display better performance characteristics. However, when we speak about organizational culture and its impact on the organizational performance, we often lack profound understanding of how management patterns impact organizational culture within the particular organization.
This is why it is necessary to research, whether organizations with stronger organizational culture display better performance, and how management impacts organizational culture. It would be scientifically correct to explore the impact of strong organizational culture on the organizational performance, as well as the interaction between management and organizational culture. As far as management is critical to support strong organizational culture, it is even more important to see organizational culture as an intermediary element between organizational culture and organizational performance.
Do organizations which have strong organizational culture focus succeed over those that do not? When we suggest that organizations with the stronger organizational culture produce better performance results, we rarely mean the way organizational culture interacts with other critical processes in organizational performance and operation. As we traditionally pay attention to the mere outcomes of the stronger organizational culture, we must critically assess the process of interaction between organizational culture and management, which ultimately leads to the improved organizational performance.
To start with, there are several different interpretations of what organizational culture is. Maryam & Kayworth (2006) states that “organizational culture is a pattern of shared values and beliefs that help individuals understand organizational functioning and thus provide them with the norms for behavior in the organization”. In his turn, Ritchie (2000) mentions that “organizational culture has been defined as the normative glue that holds an organization together”.
In their book, Paul Davidson et al (2005) discussed organizational culture through the viewpoint of several different dimensions, but although organizational culture’s definitions differ, its essence remains unchanged: it is management which promotes strong organizational culture, and ultimately improves organizational performance. “One of the key consequences of a strong corporate culture is that it increases behavioral consistency across individuals in a firm. Organizational culture defines a normative order that serves as a source of consistent behavior within the organization.
In this sense, organizational culture is a social control mechanism. ” (Sorensen, 2000) It is not difficult to conclude that the presence of an organizational control mechanism in the form of organizational culture positively impacts the whole process of management and its outcomes. As management is aimed at delivering critical organizational messages to all members of particular organization, strong organizational culture and social control ensures more uniform understanding of organizational goals.
“Organizational cultures frame people’s interpretations of organizational events and basic assumptions about organizational processes” (Ritchie, 2000). Management is perceived as the major and the determining process of the organizational performance. Management ensures that the organization utilizes stable and strong organizational culture; in its turn, strong organizational culture improves the quality of management. Thus, the organizations which promote strong organizational cultures succeed over those which lack them.
When individuals enter an organization, they do their best to understand in what environment they have appeared, and how the new environment will impact their previous patterns of organizational behavior. “By observing behaviors that are common to the members of the organization, new employees can determine what behaviors are expected and rewarded” (Ritchie, 2000). Strong organizational cultures facilitate these understandings through the promotion of comprehensive corporate values and rewards.
Strong organizational cultures create favorable conditions for adjusting management techniques to the needs of particular organization, and make it possible to clarify the connection between certain values and rewards. To manage organizational cultures means to promote the already mentioned social control, and to ensure that “new employees determine what behaviors are expected and rewarded, […] and begin the process of embracing them as their own” (Maryam & Kayworth, 2006).
Thus, management serves the starting point of the long complex pathway towards better company’s performance, through strong organizational culture which generates enhanced employee understanding of organizational values, and the ability to promote social control within the organization. It is interesting to note that managing organizational culture produces multifaceted organizational effects. Better social control and improved employee performance are not the only effects of managing and supporting strong organizational culture.
“While organizational cultures reflect past learning, they also define the context for future organizational learning, which, in turn, has consequences for performance reliability” (Sorensen, 2002). Strong organizational culture provides organizations with the better position against those with weaker cultures: organizational culture directly determines the ability of the organization to stand and react to environmental changes.
The ability to timely react to environmental changes means to avoid substantial external and internal threats to organizational performance. The discussed internal threats may actually undermine organizational coordination, control, and performance reliability about which Sorensen (2002) writes. They may also decrease the quality and coordination of management techniques, if these are not supported by strong organizational culture.
As management determines the success and strength of organizational culture, organizational culture also determines the success of management within particular organization. In reality, the organization’s ability to deal with environmental and internal threats speaks about the quality of management within this organization (Davidson et al, 2005). If strong organizational culture enhances organizational stability through better response to environmental and internal threats, this means that organizational culture is successfully managed.
In its turn, successful management of organizational culture keeps strong social control and provides timely corrective measures against the discussed organizational threats. Conclusion Numerous researches have already concluded that strong organizational cultures positively impact organizational performance. However, the area of organizational research still lacks profound understanding of how management improves organizational performance by supporting strong organizational culture.
Organizational culture serves the intermediary element between management and organizational performance: in strong organizational cultures management produces better social control, employee understanding of the organizational goals and needs, and organization’s stability towards environmental and internal threats. Simultaneously, strong organizational cultures substantially facilitate management processes in organizations. As a result, organizations which have strong culture focus succeed over those which do not.
References Davidson, P, Simon, A, Gottschalk, L, Hunt, J & Wood, G 2005, Management: Core concepts and skills, John Wiley & Sons. Maryam, A & Kayworth, TR 2006, ‘An empirical examination of the influence of organizational culture on knowledge management practices, Journal of Management Information Systems, vol. 22, no. 3, pp. 191-224.
Ritchie, M 2000, ‘Organizational culture: Am examination of its effect on the internalization process and member performance’, Southern Business Review, vol. 25, no. 2, pp. 1-13. Sorensen, Jesper B 2002, ‘The strength of corporate culture and the reliability of firm performance’, Administrative Science Quarterly, vol. 47, no. 1, pp. 70-91.