Organisational culture and effectiveness

Abstract

PurposeThe purpose of this paper is to critically evaluate the theorised relationship between organisational culture and effectiveness.Design/methodology/approachThe empirical data were collected through a five month ethnographic study in an Indian knowledge-intensive firm. It adopts the three-perspective framework of culture that encompasses integration, differentiation and fragmentation perspectives and a comprehensive examination of effectiveness.FindingsIntegrated, differentiated and fragmented perspectives of culture capture multiple organisational values and they affect effectiveness in varied ways. Appropriate cultures, although not sufficient conditions, are crucial for effectiveness, especially in knowledge-intensive firms. High levels of differentiation and fragmentation prevent the formation of strong cultures. This challenges organisational integration.Practical implicationsThere is heightened need for the application of sophisticated HRM systems in the Indian software sector. Some context specific measures of effectiveness are documented.Originality/valueThrough an insightful evaluation of culture effectiveness theorisation till date, the paper amplifies current theorisation and illustrates the potential and limitations of organisational cultures in achieving effectiveness.