Organisational Culture Influences Employee Engagement

“Culture: the way we do things around here” (Deal & Kennedy, 2003, p. 501).” Much of the current strategic management writing and that of the recent past has been preoccupied with a focus on corporate culture. The discussion not only centres on the question of whether corporate culture affects organisational effectiveness but also on the very nature of corporate culture. Is the notion of corporate culture a tangible phenomenon? Or is it, as suggested by Meyer (2007), a metaphor through which to explain complex aspects of organisational behaviour? Does the analysis of corporate culture depend upon a homogeneous set of variables through which to analyse those phenomena, or is corporate culture an umbrella for a whole range of cultures within the organisation?

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These might include a culture that generates an effective response to change, a marketing culture, a customer focused culture, a procedure and policy led culture, an enterprise culture, and a learning culture. The current research focuses on the perceptions of employees and management on the effects of their degree of employee engagement on the culture of the organisation.

Definition of Terms

Culture – pertains to “the way we do things around here” (Deal & Kennedy, 2003, p. 501); a set of assumptions, understandings, and implicit rules that govern day-to-day behaviour in the workplace. It refers to the norms and customs of a group, whether explicit or implicit in their thinking, effects, and behaviour.

Formal culture – refers to culture that is recognised and often “managed” by the owners or senior management of the organisation (Gomenz-Mejia, 2008).

Informal culture – pertains to a culture that is a consequence of both social and job-related interaction both within teams and departments (Schein, 1996).

There is a need to distinguish between what might be termed “the formal culture” and “the informal culture”. The formal culture being that recognised and often “managed” by the owners or senior management of the organisation, and the informal being a consequence of both social and job-related interaction, both within teams and departments. Schein (1996, p. 9) articulates the difficulties that can be experienced in communication between groups within the same organisation. He identifies three typologies: “executives”, “engineers,” and “operators”, each having a mutually exclusive paradigm on the organisation and the key drivers of that organisation.

The discussion on corporate culture and the question of whether culture has an effect upon organisational development occupies a good deal of space in contemporary academic management literature. However, the focus is largely concentrated on the larger corporate and organisational sectors. A recent exercise associated with this research, using a major online database, revealed 200 journal articles related to “corporate culture” between 1995 and 1998.

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What is Corporate Culture?

The literature on corporate culture is diverse and, as might be expected, contains a plethora of perspectives. Some writers challenge the notion that corporate culture exists separately from the ideology and climate within the company. They also argue that culture is about the company norms of behaviour and the way that the company operates (Alvesson, 1995). Alvesson (1995) also challenges the term “corporate culture” itself. Whilst he recognises some of the attributes of “corporate culture” as being present, he suggests that other attributes of organisational behaviour might be more satisfactory in providing effective definitions and explanations. He offers “organisational climate”, “corporate ideology”, “informal behaviour patterns”, “norm systems,” or “shared meanings and symbols” as alternatives.

However, whether we are able to establish a working definition for corporate culture or whether that degree of focus remains elusive, we might still be left with an ongoing debate as to what might be included in an analysis of culture within an organisational setting.

According to Deal and Kennedy, “culture by definition is elusive, intangible, implicit, taken for granted, but every organisation develops a set of assumptions, understandings, and implicit rules that govern day-to-day behaviour in the workplace. Participants often describe these patterns as the “way we do things around here”, and thus sanction and reinforce them (Deal & Kennedy, 2003, p. 501).”

Whereas Deal and Kennedy view “corporate culture” as a total organisational phenomenon, affected by groups of people throughout the organisation, Schermerhorn (2005) views culture as a management instrument that:”… Mobilises combinations of values, language, rituals and myths, is seen as the key factor in unlocking engagement and enthusiasm of employees (Thompson & McHugh, 1995, p. 198).”

Corporate Culture: Process and Context

In the context of a firm, if culture is a meaningful phenomenon, where does it begin, and how does it permeate? Is it an organic process, as Deal and Kennedy (2003) seem to imply? Or is it a management instrument, created by management and managed by management as is implied by Thompson and McHugh? Or, indeed, is it something else?

In the family business context, Gersick et al. concur with the view expressed by Thompson and McHugh (1995) They argue:” The start-up stage is a time when the foundation is laid for the three core aspects of the family business: company culture, structure, strategy and management engagement (Gersick et al., 1997, p. 149).”

Burnes (1996) argues, however, that culture is not static, that individuals and groups within the organisation add to the culture in a way that could be described as organic. This view is reflected by Deal and Kennedy (2003), who suggest that organisations become “social fictions”, creating their own paradigm during a process of organic cultural development.

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The globalisation of countries has brought about several changes in the approach to business development and corporate affairs. After the trade of expansion of industries to the commerce of multi-faceted products, the market is now slowly adopting a system of culture-based strategies. The management circle refers to this approach as an organisational culture where people-oriented procedures, such as total quality management and customer service policies, are being implemented. In view of Australia’s top 300 companies, Gardner (1995) held that there is a significant change in the organisational structure of these top companies between the years 1990 and 1993.

The changes that occurred in the said year included some amount of corporate downsizing; 66% involved rationalisation/restructuring, 28% necessitated an improvement in the customer service, and 22% called for a restructuring of the general management workforce. Moreover, managers and critics alike have predicted that much of these changes would also require mergers and acquisitions, growth or downsizing phases in an organisation’s life cycle, and some periods of conflict or diversification (e.g. Perez, 1995; Schwartz & Davis, 2001; Wilkins, 2003).

The idea of organisational culture commenced with the notion that this culture-based development would provide more viable and productive economic consequences that include greater work efficiency, an increase in employee commitment and cooperation, improvement in job performance and a better decision-making capacity (e.g. Barney, 2006; Kopelman, Brief & Guzzo, 1990; Thompson & Luthans, 1990; Weick, 2005; Wilkins & Ouchi, 2003).

But then again, there were some scholars who argued that not all developments geared towards more responsive and competitive organisations were successful due to the fact that most of the time, the organisational leaders do not possess a clear-cut idea as to the path and process by which this culture change must take. Beer & Walton (1990) were among the sceptics who claimed that there was a lack of proper information dissemination within an organisation’s top ladders that ultimately cause the downfall of such changes. Oftentimes, this confusion leads to lost productivity and difficulties in translating strategy into improved organisational and individual performance.

Also, there arises a disparity within the executive and managerial positions’ perception of performance against the perception of those in less senior positions. For these reasons, it must be noted that there must be a consistent cultural attitude about the culture of the organisation among the managers and that there must be a clear picture as to the managerial perceptions of organisational standards of customer service compare.

Although much of the current literature regarding corporate development affirms the positive relationship of organisational culture and employee degree of employee engagement in an organisation – as observed in their behaviour and performance, some scholars maintain that this so-called link is yet to be empirically substantiated. Siehl & Martin (1990) believe that this absence of proof may be attributed to problems with defining key constructs such as culture and financial performance and to a shortage of rigorous empirical studies.

Issues in the Organisational Culture Literature

The main problem that this subject faces is the lack of an explicit and comprehensible definition of the term organisational culture. Then again, there seems to be an advent of 4 fundamental principles that make up organisational culture: first, that it is stable and resistant to change; second, that it is taken for granted and less consciously held; third, that it derives its meaning from the organisation’s members; and fourth, that it incorporates sets of shared understandings (Saxton & Serpa, 2005).

Given the fact that the term organisational culture embraces such a vast area in management, most investigators have focused on certain layers of culture (see review by Rousseau, 1990). Wiener (2002) focused on value systems for the reason that it provides meaning and perspective to understanding organisational phenomena. Rentsch (1990), on the other hand, focused on shared meanings, while Kilman et al. (2005) focused on beliefs.

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On the contrary, Schein (2001, 2005, 1990) adopted a more comprehensive framework for dealing with the different levels of cultural manifestation. Schein used a cultural paradigm in order to bind the basic assumptions of an organisation’s culture. While not all basic assumptions are mutually consistent, Schein argued that all groups would eventually evolve a certain series of assumptions that would then be consistent for the reason that all the needs of human beings are paramount to each other. Schein (1990) further developed a set of logical categories for studying and analysing these cultural paradigms.

However, change is only a superficial transformation as far as the altercation is concerned. For this system to be effective, there is a need for such a scheme to penetrate the organisational members. This characteristic is often referred to as the pervasiveness of the culture. It is regarded as the degree to which organisational members agree with an organisation’s culture or value system as a whole (Sathe, 2005; Wiener, 2002).

It has been maintained that in the past, strong cultures were indicative of desirable organisational outcomes such as increased member identification, commitment, cooperation and greater consistency in decision making and performance (e.g. Pettigrew, 1979). Still, Schneider & Rentsch (2002) and Sathe (2003) insist that a strong organisational culture may possess an innate resistance to change, which may undeniably lead to the failure of such a program. In a sense, a strong culture may pose a liability when it is not in keeping with the needs of its members or the organisation in the context of its operating environment.

But then, Kopelman et al. (1990) claim that there is yet a need to present pragmatic evidence to such an account. Martin & Siehl (2003), on the other hand, states the need to refrain from assuming that cultures are strong or pervasive. This is due to the fact that there exists a lack of a coherent culture within a unit or department. For that, multiple subcultures can exist within organisations, but this would not automatically imply a weak culture.

Consequently, Saffold (2002) has suggested that instead of looking into the process by which an organisation’s generalised culture affects performance, it may often be more precise to study how its multiple subcultures interrelate to influence outcomes. Studies regarding organisational culture have been fast-changing that a cursory glance at reports would prove futile because a profound study of the subject is necessary to meet organisational objectives and strategies (Wilkins & Dyer, 2002). But then again, there has been a comparative lack of a particularised type of studies (see Reichers & Schneider, 1990).

This absence of a segmented type of study may be attributed to the confidential and transitory nature of organisational culture. After all, organisations have the understandable propensity to focus their studies on a particular time frame and are limited to a specific problem. For that reason, most of their studies may not be used as a foundation to merit future organisational predictions.

It has been held that organisational culture, once established, is difficult to change. This is explained in the context of Bandura’s social learning theory, where the creation of a new set of organisational cultures would entail learning new behaviours that are complex (Thompson & Luthans, 1990). But in dealing with corporate change, there are two ways by which this culture change may be instigated: first, by changing the culture in order to suit the strategy (Allen & Dyer, 2000); or, second, by designing the strategy according to what is attainable given the current culture (Schein, 1990).

But then again, before either of these two methods may be applied, a ‘culture review’ is needed in order to ascertain what approach is best suited (Robbins & Barnwell, 1991; Wilkins, 2003). This process would help identify the current culture and the desired culture, allowing a ‘gap’ evaluation of culture features that need changing (Robbins & Barnwell, 1991).

As mentioned, analysing culture is difficult in the sense that there exist different levels at which culture is manifested. Also, the innate characteristic of the culture as being implicit and often taken-for-granted makes it more difficult to access. The political issues involved, with power groups having various self-interests in maintaining or changing the culture, is also another reason why culture is very complicated to study. The possibility of the existence of multiple subcultures is another factor. Wilkins (2003) and Pettigrew (1990) discussed these reasons.

Organisational Culture Research

Basically, two main types of research methods prevail. These are a qualitative method, as characterised by research that is contextually embedded and requiring interpretation, and a quantitative method, characterised by research that is context-free, using a priori categories. Several works have discussed the advantages and detriments of each type (Reichers & Schneider, 1990; Rentsch, 1990; Rousseau, 1990; Schein, 2001, 1990). In brief, the qualitative approach allows a richer and more comprehensive view of culture because culture is derived from its members and that it is unique. Proponents of qualitative methods (e.g. Schein, 1990) have argued that it is imperative that the cultural concepts for each particular organisation are explored rather than taken as given a priori understanding.

But then, the qualitative method is distinguished as lacking a sense of objectivity, causing it to lack the reliability of its data and the validity of its conclusions. Also, in this method, there is a difficulty in comparing qualitative studies and the tendency of cultures to be portrayed as consistent or uniform. Nevertheless, Sathe (2003) argues that reading culture is subjective and interpretive and that ‘the validity of diagnosis must be judged by the utility of insights it provides, not by its “correctness” as determined by some objective criteria’ (p. 7).

The quantitative approach, on the other hand, entails the rigour of research, suitability for theoretical testing, developing universal statements, and facilitating intra- and inter-unit comparisons. But several authors have evaluated quantitative approaches as limiting culture categories to the researcher’s favourites or being biased towards particular styles of management thinking. It was maintained that the quantitative approach distorts the culture being investigated, which sometimes lead to the invalidation of the study (Luthans, 2004; Rousseau, 1990). In addition, the quantitative method is an aid to be limited by their flexibility in handling the ‘meaning’ of behaviours and have a tendency to tap into diversity and variability rather than the uniformity of cultures.

Measuring Organisational Culture: The Rep Grid

But despite these criticisms, there have been many attempts to assess culture in order to measure organisational culture (for a review, see Rousseau, 1990). Evered & Louis (2001), Sanday (1979) and Rousseau (1990) conclude in their review of organisational culture methodology that the choice of method largely depends on the researcher’s training, cognitive style and preference, with allegiances to single modes of inquiry. Jelinek, Smircich & Hirsh (2003) go further to recommend that a range of approaches is required since the concept of organisational culture is broad and currently not specifically defined, such as other organisational constructs like climate.

One measure that shows promise in this area, however, is the repertory grid technique (Rep Grid). Personal construct theory techniques have been used in a range of areas. Business applications of the Rep Grid have included counselling, employee selection, analysis of motivation at work, evaluation of training and brand differentiation, self-construction changes and vocational differentiation (e.g. Dalton & Dunnett, 1990; Fournier & Payne 1994; Gordon & Langmaid, 2002; Jankowicz, 1990; Neimeyer, Leso, Marmarosh, Prichard & Moore, 1992). There are, however, few published reports of the use of the Rep Grid in the organisational culture literature.

The Rep Grid provides a useful structure to articulate cultural norms, behaviours and assumptions using diverse concrete examples. It allows the investigator to obtain an understanding of how managers perceive their organisational culture, which can minimise researcher bias. It also assists study participants to clearly specify what they mean, which would not be as readily articulated in a semi-structured interview. In the Rep Grid, the construct elicitation process allows for researcher probing and is more difficult to fake. The number of comparisons to be used also minimises the possible tendency of study participants to provide only ideal scenarios of organisational culture.

This method also provides efficiency and focus as to what could otherwise be an unproductive interview. The technique that is utilised in this process is stimulating and novel for study participants, thereby maintaining their interest. Additionally, Schein (2001) recommends analysis of the beliefs, degree of employee engagement in an organisation and assumptions of culture creators and carriers using the more structured approach of the Rep Grid, making it accessible to researchers and practitioners, rather than the combined clinical and ethnographic approach.

The Rep Grid causes a few problems for the reason that even with few participants, the large number of constructs elicited and the need to combine the information across several participants is very complex. Quinn (2002) proposed several modes of aggregation, one of which involves discussion of elements and constructs in a group discussion format, with the final use of an aggregate set. This method is also relevant in the context of culture being defined as shared elements such as feelings, assumptions, beliefs and degree of employee engagement in an organisation. Rentsch (1990) used a different method by adopting the most frequently mentioned events and adjectives from initial interviews.

All in all, the depth of the culture construct imposes a great onus on an investigator (Louis, 2005, p. 83). Louis recommended a pragmatic framework for viewing organisational culture that generally relates to issues such as the origins of culture, the outcomes or effects of culture, the manifestations of culture, and the management of culture. The review of related studies presents a glaring need for additional individual cases, which would employ a variety of valid and combinations of multiple approaches to studying organisational culture while integrating the findings in a more systematic and comprehensive way in order to contribute to the development of the subject-matter (Quinn, 2002).


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