Abstract
Although statistical evidence seems to be lacking. it is at present widely acknowledged that organisational culture has the potential of having a significant effect on organisational performance. An analysis of sustained superior financial performance of certain American organisations has attributed their success to the culture that each of them had developed. It has been proposed that these organisations are characterised by a strong set of core managerial values that define the ways in which they conduct business. how they treat employees, customers, suppliers and others. Culture is to the organisation what personality is to the individual. It is a hidden but unifying force that provides meaning and direction and has been defined as the prevailing background fabric of prescriptions and proscriptions for behaviour, the system of beliefs and values and the technology and task of the organisation together with the accepted approaches to these. Recent studies have indicated that corporate culture has an impact on a firm's long-term financial performance: that corporate culture will probably be an even more important factor in determining the success or failure of firms in the next decade; that corporate cultures that inhibit long-term financial performance are not rare and that they develop easily. even in firms that are staffed by reasonable and intelligent people; and that corporate cultures, although difficult to change, can be made more performance enhancing. The purpose of this study, therefore, was to establish the statistical relationship between organisational culture and financial performance.
Highlights
The notion that workgroups in organisations develop their own behavioural norms and that the resulting mode of behaviour has an impact on an organisation's performance has been established long ago (Roethlisberger & Dickson, 1975)
The human relations movement sparked by the Hawthorne studies was directly relevant to today's efforts to understand and manage corporate culture (Kilman, Saxton & Serpa, 1986: 92)
In New patterns of management, concluded that a genuine interest and an unselfish concern on the part of the superior in the success and well-being of his subordinates have a marked effect on their performance. He emphasised the need for a corporate culture of cooperation and demonstrated that there was a significant correlation between employee attitudes and performance (Likerl, 1961 )
Summary
The notion that workgroups in organisations develop their own behavioural norms and that the resulting mode of behaviour has an impact on an organisation's performance has been established long ago (Roethlisberger & Dickson, 1975). The human side of enterprise, stated that most managers make incorrect assumptions about those who work for " them He was among the first to suggest practical applications of the findings about corporate culture that came from the Hawthorne studies (McGregor, 1960). Many constraints placed by organisations on human beings are self-defeating to organisational goals of effectiveness and efficiency He recommended that management develop a climate in which problems could be expressed openly and in which employee hostility could be understood and accepted (Argyris, 1964). In New patterns of management, concluded that a genuine interest and an unselfish concern on the part of the superior in the success and well-being of his subordinates have a marked effect on their performance He emphasised the need for a corporate culture of cooperation and demonstrated that there was a significant correlation between employee attitudes and performance (Likerl, 1961 ). The purpose of this study, was to establish the statistical relationship between organisational culture and financial performance
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