THE IMPACT OF ORGANIZATIONAL CULTURE ON EFFECTIVE EMPLOYEES' PERFORMANCE TOWARDS THE ATTAINMENT OF ORGANIZATIONAL GOALS
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THE IMPACT OF
ORGANIZATIONAL CULTURE ON EFFECTIVE EMPLOYEES' PERFORMANCE TOWARDS THE
ATTAINMENT OF ORGANIZATIONAL GOALS
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE
STUDY
Organizational culture refers to a system of shared
assumptions, values, and beliefs that show people what is appropriate and
inappropriate behavior. These values have a strong influence on employee
behavior as well as organizational performance. In fact, the term
organizational culture was made popular in the 1980s when Peters and Waterman’s
best-selling book In Search of Excellence made the argument that company
success could be attributed to an organizational culture that was decisive,
customer-oriented, empowering, and people-oriented. Since then, organizational
culture has become the subject of numerous research studies, books, and
articles. Organizational culture is still a relatively new concept (Daft, 2003).
In contrast to a topic such as leadership, which has a history spanning several
centuries, organizational culture is a young but fast-growing area within
management.
Culture is largely invisible to individuals just as the sea
is invisible to the fish swimming in it. Even though it affects all employee
behaviors, thinking, and behavioral patterns, individuals tend to become more
aware of their organization’s culture when they have the opportunity to compare
it to other organizations (Amah, 2009). The organizing function involves
creating and implementing organizational design decisions. The culture of the
organization is closely linked to organizational design. For instance, a
culture that empowers employees to make decisions could prove extremely resistant
to a centralized organizational design, hampering the manager’s ability to
enact such a design. However, a culture that supports the organizational
structure (and vice versa) can be very powerful (Daft, 2003).
An organization’s culture may be one of its strongest assets
or its biggest liability. In fact, it has been argued that organizations that
have a rare and hard-to-imitate culture enjoy a competitive advantage. In a
survey conducted by the management consulting firm Bain & Company in 2007,
worldwide business leaders identified corporate culture to be as important as
corporate strategy for business success. This comes as no surprise to leaders
of successful businesses, who are quick to attribute their company’s success to
their organization’s culture (Garvin, 1998).
Culture, or shared values within the organization, may be
related to increased employee performance. Researchers found a relationship
between organizational cultures and employee performance, with respect to
success indicators such as revenues, sales volume, market share, and stock
prices leading to realization of the organizations goal. At the same time, it
is important to have a culture that fits with the demands of the company’s
environment. To the extent that shared values are proper for the company in
question, employee performance may benefit from culture. For example, if a
company is in the high-tech industry, having a culture that encourages
innovativeness and adaptability will support its performance (Amah, 2009).
However, if a company in the same industry has a culture characterized by
stability, a high respect for tradition, and a strong preference for upholding
rules and procedures, the company may suffer because of its culture. In other
words, just as having the right culture may be a competitive advantage for an
organization, having the wrong culture may lead to performance difficulties,
may be responsible for organizational failure, and may act as a barrier
preventing the company from changing and taking risks (Caves and Porter, 1977).
In addition to having implications for employee performance,
organizational culture is an effective control mechanism dictating employee
behavior. Culture is a more powerful way of controlling and managing employee
behaviors than organizational rules and regulations. For example, when a
company is trying to improve the quality of its customer service, rules may not
be helpful, particularly when the problems customers present are unique.
Instead, creating a culture of customer service may achieve better results by
encouraging employees to think like customers, knowing that the company
priorities in this case are clear. Therefore, the ability to understand and
influence organizational culture is an important item for managers to have in
their tool kit when they are carrying out their controlling function as well as
their organizing function to enhance employee performance and promote the
realization of the organizational goals.
1.2 STATEMENT OF THE
PROBLEM
Several researches on how to optimize employee performance
with a view to realize organizational goal have taken place in the past two
decades. It has been argued that strategic group membership and associated
collective behaviours are the primary sources of durable differences in firm
profitability and effective employee performance (Caves and Porter, 1977). This
implies that the collective behaviour of organization members which culture
helps to control is important to its effectiveness. In relation to this
argument, Glasister and Buckley (1998) identified organizational culture as one
of the factors responsible for organizational effectiveness and employee
performance. A strong organizational culture (that is, one in which everyone
understands and believe in the firm’s goal, priorities and practices) that
encourages the participation and improvement of all organization’ members has
been identified to be one of its most important assets (Denison, 1985).
However, the researcher seeks to analyze the impact of organizational culture
on employee performance.
1.3 OBJECTIVES OF THE
STUDY
The general objective of this study is to analyze the effect
of organizational culture on employee performance and the following are the
specific objectives:
To examine the effect of organizational culture on the
employee performance.
To identify the type of organizational culture capable of
enhancing employee performance in an organization.
To identify factors hindering the employee performance in an
organization.
1.4 RESEARCH
QUESTIONS
What are the effects of organizational culture on the
employee performance?
What are the types of organizational culture capable of
enhancing employee performance in an organization?
What are the factors hindering the employee performance in an
organization?
1.5 HYPOTHESIS
HO: There is no significant relationship between the
organizational culture and employee performance in an organization
HA: There is significant relationship between the
organizational culture and employee performance in an organization
1.6 SIGNIFICANCE OF
THE STUDY
This study on the effect of organizational culture on
employee performance towards the attainment of organizational goals is
significant in the following ways:
It will enlighten managers and other stakeholders in Nigeria
on the need for better organizational culture as the result from this study
will guide them in selecting and adopting better organizational culture in the
organization for better employee performance.
This research will be a contribution to the body of
literature in the area of the effect of organizational culture on the
performance of quantity surveying firms in Nigeria, thereby constituting the
empirical literature for future research in the subject area.
1.7 SCOPE/LIMITATIONS
OF THE STUDY
This study on the effect of organizational culture on the
employee performance in organizations in Nigeria will cover all the corporate
organization in Nigeria by carefully examining their organizational culture and
its effect on employee performance with a view to attain the organizational
goal. The study will also cover an overview of factors militating against
employee performance.
LIMITATION OF STUDY
Financial constraint- Insufficient fund tends to impede the
efficiency of the researcher in sourcing for the relevant materials, literature
or information and in the process of data collection (internet, questionnaire
and interview).
Time constraint- The researcher will simultaneously engage in
this study with other academic work. This consequently will cut down on the
time devoted for the research work.
1.8 DEFINITION OF
TERMS
Culture: the arts and other manifestations of human
intellectual achievement regarded collectively.
Performance: The accomplishment of a given task measured
against preset known standards of accuracy, completeness, cost, and speed. In a
contract, performance is deemed to be the fulfillment of an obligation, in a
manner that releases the performer from all liabilities under the contract.
Organization: A social unit of people that is structured and
managed to meet a need or to pursue collective goals. All organizations have a
management structure that determines relationships between the different
activities and the members, and subdivides and assigns roles, responsibilities,
and authority to carry out different tasks. Organizations are open
systems--they affect and are affected by their environment.
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