Develop The Right Organisational Culture Commerce Essay

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During the last decade with large amount of emerging opportunities, the world has witnessed the spawning of new businesses in many sectors. While many have closed down, some have been able to achieve superior performance and sustained profitability. Indeed firms have put forward strategies to achieve such sustainability based on the analysis of the firm's external and internal environments (Porter, 1985). It can be argued that the external environments faced by firms are almost the same. One of the main constituents of the internal environment is that the firm is made up of people who individually and collectively contribute to the success of the organisation (Barney, 1986).

Businesses constitute of people who express different behaviours when exposed to different situations. Such behaviours emanate from the culture of the people which is constantly enacted as interactions take place between different people (Schein, 2004). When such cultures are brought into and aligned to the organisation's strategy, a culture is developed within the organisation which shapes into the organisational culture. As businesses deal, employs and is owned by people, understanding culture and culture of groups of people is of utmost importance as they give rise to different business practices (Daniels and Radebaugh, 1998). These practices depend on the organisational culture of the firm which is a critical success factor in defining the overall success or failure of organisations.

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Different countries interpret organisational culture differently and this is reflected in their beliefs, living styles, perceptions and the way businesses are practised. With the mushrooming of multinational corporations in different parts of the world, businesses are requiring people with different nationalities and cultural backgrounds to collaborate together (Punia and Luxmi, 2005). Thus the understanding of cultural capital (Barett, 2010) is of utmost importance for managers.

1.2 Rationale and Problem Statement

The country of Mauritius is made up of a unique blend of ethnic groups which have their origins from different parts of the world. Each ethnic group has its own cultures and may have certain similarities or they may vary significantly between these groups. As firms established or implanted in Mauritius employ people from these various ethnic groups, it is interesting to look into the kind of organisational culture developed by those firms and how it affects their business performances. Thus the main purpose of the study is to determine whether organisational culture impacts business performance of Mauritian companies in the Information and Communication Technology (ICT) sector.

Organisational culture, also known as corporate culture, is a unique pattern of key basic assumptions that are shared among members of a group of an organisation and to new members that a group learned as it solved problems (Punia and Luxmi, 2005; Daft, 2005; Al-sardieh, 2012).

It is believed that firms that develop the right organisational culture are bound to succeed. The impact of some of the strategies and behaviours exercised by organisational leaders and top management develops the organisational culture which is constantly adapted and over the years, serving the organisation's underpinning in achieving superior business performance. Even though different variations of culture exist at the different hierarchies and different departments in the organisation, the key strand of this research examines the over-arching relation between organisational culture and the overall firm's performance. It is judged that this makes the research both intrinsically interesting and also a useful one to support the notion that organisational culture's academic validity by delivering an empirical investigation of the culture of ICT organisations. In doing so, it may perhaps prepare the ground for a subsequent and even more comprehensive national, international and or sectorial analysis. Mauritian firms seeking to makeover their organisational culture may use this research as a reference to drive the organisational climate.

Besides, the past three decades have been replete with studies on organisational culture and its various impacts on organisations such as job satisfaction, organisational commitment, knowledge management and so on. These studies have asserted that organisational culture is a building block in the organisational design and its impacts cannot be neglected. Furthermore, very few studies have been conducted in Mauritius on the organisational culture subject.

As the Mauritian government is striving for the ICT sector to become a key pillar of the economy, companies in this sector is facing increasing competition, this study has focused on this sector to guide. ICT contributes % of the GDP.

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Since the early 2008 the world is facing an acute financial crisis and as a consequence many firms have closed their business while others have integrated vertically or horizontally. As the crisis continues to linger, firm's profitability are decreasing and they have to reduce their costs and have to make their organisations more efficient and as the same time there is a dire need to stay competitive on the market. Organisational culture has been recognised as a being a source of competitive advantage by various researchers (Lee and Yu, 2004). As organisational culture is complex and is constantly changing, its understanding, management and adaptation is crucial for managers. Thus the problem statement can be stated as: the impact that organisational culture has on firm's performance.

1.3 Objectives of the study

With globalisation modern management tools are constantly invented. Such tools shape the way business practices are conducted in organisations. Firms still bound with traditional and or legacy business practices have to revamp their operations in the quest of survival and global presence. Good management practices involve knowledge of organisational culture and how it ambits the organisation.

To give effect to the problem statement, the objectives of the study are twofold. Firstly, the concepts and dimensional constructs of organisational culture are operationalised. Then the impact of organisational culture on organisational performance is investigated. The concept of organisation culture used in this study is based on the Competing Value Framework (CVF) model developed by Cameron and Quinn (2011) which categorise organisational culture into four types namely "Clan", "Adhocracy", "Market" and "Hierarchy". The study investigates which type of organisational culture is dominant in the ICT sector. Firms having a strong dominant culture achieve superior performance. The relationship between the four organisational cultures and performance is investigated. It is also investigated whether organisational culture can be used as a predictor of organisational performance. Other analyses are also conducted to determine the relationship between organisational culture with job position, age, years of experience, gender and organisational size.

The results of this research can be used by Mauritian firms to adapt their organisational culture to enhance organisational performance.

1.4 Research questions and formulation of hypotheses

In order to meet the objectives of the research, the following set of research questions and hypotheses are formulated. These hypotheses are graphically illustrated in Figure 1.

Research Question 1: Does organisational culture impact on organisational performance?

The null hypothesis H01 is that there is no relationship between the company's organisational culture and its performance: -

H01 There is no relationship between organisational culture and organisational performance

The alternate hypothesis H11 is that there is a relationship between a firm's organisational culture and its business performance: -

H11 There is a significant relationship between organisational culture and organisational performance

Figure - Theoretical model and hypotheses

Research question 2: Do the four types of organisational culture impact on a company's business performance?

For this research question, the following subsets of null and alternate hypotheses are formulated for each type of organisational culture.

H02 There is no relationship between the Clan organisational culture and organisation performance

H12 There is a significant relationship between the Clan organisational culture and organisational performance

H03 There is no relationship between the Adhocracy organisational culture and organisation performance

H13 There is a significant relationship between the Adhocracy organisational culture and organisational performance

H04 There is no relationship between the Market organisational culture and organisation performance

H14 There is a significant relationship between the Market organisational culture and organisational performance

H05 There is no relationship between the Hierarchy organisational culture and organisation performance

H15 There is a significant relationship between the Hierarchy organisational culture and organisational performance

Research question 3: Can organisational culture be used as a predictor of organisational performance?

The null hypothesis formulated is that organisational performance is not dependent on organisational culture: -

H06 Organisation performance is not dependent on organisational culture

The alternate hypothesis is that organisational performance is dependent on organisational culture: -

H16 Organisation performance is dependent on organisational culture

Research question 4: Does the age of an employee impacts on culture of an organisation?

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The null hypothesis formulated is that there is no relationship between the age of an employee and organisational culture: -

H07 There is no relationship between age of an employee and organisational culture

The alternate hypothesis is that there is a significant relationship between the age of an employee and organisational culture: -

H17 There is a significant relationship between age of an employee and organisational culture

Research question 5: Does the job position of an employee impacts on the firm's organisational culture?

The null hypothesis is that there is no statistically significant relationship between job position and organisational culture: -

H08 There is no statistically significant relationship between an employee's job position and organisational culture.

The alternate hypothesis is that there is a statistically significant relationship between job position and organisational culture:-

H18 There is a statistically significant relationship between an employee's job position and organisational culture.

Research question 6: Does experience on the current position of an employee impacts on organisational culture?

The null hypothesis formulate is that there is no significant relationship between employee experience and organisational culture.

H09 There is no significant relationship between employee's experience and organisational culture

The alternate hypothesis can be stated as: -

H19 There is a significant relationship between employee's experience and organisational culture

Research question 7: Does the size of an organisation impacts on organisational culture?

The null hypothesis formulated is that there is no relationship between organisation's size and organisational culture: -

H010 There is no relationship between the organisation size and organisational culture

The alternate hypothesis is that there is a significant relationship between organisational size and organisational culture

H110 There is a relationship between organisation size and organisational culture

Research question 8: Is there a significant difference between male and female respondents on organisational culture?

The null hypothesis can be stated as: -

H011 There is no difference between male and female respondents on organisational culture

The alternate hypothesis is that there is a significant difference in organisational culture between male and female:-

H111 There is a significant difference between male and female respondents on organisational culture

1.4 Organisation of the research work

In this section, the overall structure of the study and a brief guide to the subsequent chapters are provided.

Accordingly, Chapter 1 provides a brief description of the study, the orientation of the research. It also describes the purpose of the research with the objectives to be met and the hypotheses formulated with respect to the research questions.

Chapter 2 consists of the academic research and theoretical reviews of organisational culture and organisational performance. The concept of culture and organisational culture are introduced as well as performance construct. The models and frameworks used are also discussed in this chapter. The relations between organisational culture and organisational performance are discussed.

Chapter 3 deals with research methodology which includes the sample chosen and the type of research undertaken. The validity and reliability of the models used in the research are also discussed in this chapter.

Chapter 4 provides the empirical results of the research. It also includes all the statistical analyses performed and the results obtained in view to validate the hypotheses formulated and to answer the research questions.

Chapter 5 purports to whether the research objectives set have been met together with strength and weakness of the research. Recommendations and future scope of studies and further research are proposed.