Organizational Culture, Identity and Commitment - Literature review Example

Organizational Culture, Identity and Commitment al Affiliation] Contents 1Introduction 3 2Culture and Organizational Culture 3 3Identity and Organizational Identity 7 3.1Relationship between Organizational Culture and Organizational Identity 8 3.2Why is Organizational Identity of Such Importance 9 4Collective Commitment and Organizational Collective Commitment 11 4.1Importance of Organizational Commitment to the Organization 12 4.2Relationship between Organizational Culture and Collective Organizational Commitment 12 5Conclusion 14 6References 15 1 Introduction Organizational culture has increasingly being questioned for its existence, reality and importance in the business setting. Organizational culture is referred to as the “personality” that an organization carries in a stable way (Higgs and Aitken, 2009). It serves as a guideline for the people to behave in a certain manner within the organization (Schultz, 1995). The culture of an organization aids the accomplishment of its goals and keeps harmony between the employees and the organizational management (Friday, 2002). It further creates a positive impact on stakeholders regarding the procedures and relationships between the organization and its wider stakeholders. The aim of this paper is to investigate what organizational culture entails, the importance it carries, its relation to the organizational identity and critically discuss that organizational culture provides members with an organizational identity and facilitates collective commitment. The paper is organized with information flowing in a reasonable manner from simpler definitions of the concepts to the more complex theoretical underpinnings and relation between the concepts under view. In particular, the paper aims to argument that organizational culture provides members with an organizational identity and facilitates collective commitment. Hence specific reference is made to three important concepts namely organizational culture, organizational identity and collective commitment. 2 Culture and Organizational Culture Hofstede (1994, p 627) defines culture as “the collective programming of the mind which distinguishes the members of one group or category of people from another.” Schein defines three layers of cultures as artifacts, values and basic assumptions. Artifacts are defined as the tangible elements of the culture like uniform, technology etc while values and basic assumptions are underlying intangible elements that derive behaviors, perceptions and thoughts (Schein, 1988, pp 14-18). Schein (2004) defines organizational culture as a common pattern of fundamental assumptions that resolves a group’s issues relating to external adaptation and internal integration. It is a pretested, valid and right way to think, perceive and feel that can easily be transferred to the new comers in the organizational environment. Looking closely at the concept of organizational culture, it is not difficult to assert that it entails a common set of beliefs, assumptions and values (Ashkanasy, Wilderom & Peterson, 2011). The organization, as a result, moves in a unified direction following the same set of mind in decision making, behaving and carrying out day-to-day activities. The concept of organizational culture is highly embedded in the manner seniors act and react with their clear exposition of a specific management style (i.e. bottom-up or participative etc.) (Dozier, Grunig, & Grunig, 2013). Organizational culture is further defined by the perception of employees about the management and the relationship between them. If they are highly regarded, applauded and keenly involved in the decision making process, they might be more loyal, satisfied and involved with the organization (Ivancevich & Konopaske, 2011). Hence, the behavior of management and seniors build up the culture that prevails in the organization. Most importantly, organizational culture is not a clearly defined and explicitly stated theoretical framework but rather is prevalent in the organizational boundaries silently but with its strong force in shaping attitudes, behaviors and perceptions of people involved (Zerwas, 2014). In normal circumstances, people learn the culture of any organization by regularly witnessing others in the organization to act, behave, react or perform in a certain manner. Having said that organizational culture is not explicitly stated, it can be seen as a part of a psychological system and corporate philosophy that is felt, understood and adopted by the members of an organization (Staw, 1983). Organizational culture is a psychological contract between the employees with each other and with the organization as a whole (Zhou, 2011). The psychological contract goes beyond the formal employment contract and responsibilities on the part of both parties involved (Price, 2007). Employees, in this regard, expect higher job security, increased flexibility for hard work etc. and organizations expect to receive boosted performance, higher commitment to the organizational goals and success and so on (Knights & Willmott, 2012). The culture further identifies the power- authority relationship as the former defines the ability to influence others in the organization while the latter describes the formal capacity and authority to do so. The selection and qualities of people within the organization is also derived by the culture it holds. An innovative, risk-taking and industry leading organization would require energetic, bold and creative employees to be a part of their organization (Knights & Willmott, 2012). Hence, it depends on the mission and vision of the organization to maintain a culture that best suits the needs. An innovative organization would require bold, creative and risk taking individuals to maintain the culture of innovation and uniqueness in the offerings while others will need followers to maintain the status-quo and imitate the works of others or their previous product offerings (Fleet and Griffin, 2013). Organizational culture further involves the patterns and levels of communication between organizational members. In addition, it comprises the interaction and relationship between the members of the organization (Kirst-Ashman, 2014). The manner of communication, their behaviors with each other and the way they perceive each other (i.e. as rivals or partners) in the working relationship also develop the culture of the organization. The reward-punishment rules also shape up the culture of the organization in terms of rewarding a desirable act or punishing for an undesirable behavior (Madu, 2012). For instance, the culture of punctuality can be developed by declaring loss of pay for lateness or by appraising the most punctual employees thereof (Sanchez, 1990). Hence, the development of a culture is the development of attitudes and norms that lead to the expectations from and of employees (Dawson, 2010). If these expectations are not met by either of the parties, conflicts and dissatisfaction arises disrupting the organizational operations and performance (Morgan, 2012). Organizations need collaboration of entire workforce to achieve the goals. Any distraction or deviance from the expected behaviors and decisions in changing situations may result in conflicts leading to lower performance and unattainable organizational success. Hence, culture provides a ‘common sense’ to the workforce in order to deal with the situations they face while carrying out daily activities. The formal job description, policies and ethical and professional frameworks that are communicated to the employees usually contain all the details of the expected behaviors and guidelines to act within the organization, however, culture goes beyond the explicit explanation and involves more of the practical exposure to the manners and behaviors of involved people (Knights & Willmott, 2012). Hence, the understanding of expectations on their behavior, actions and attitude within the organization leads to greater levels of harmony among the management and employees strengthening their relationship and leading to higher employee satisfaction with the workplace (Dirani, 2007). In simple and concise words, organizational culture provides a way to behave, act, react, think and interact with the people and environment. This culture is exhibited through the policies, procedures, job descriptions and formal communication on expected behaviors of the individuals involved (Wood, 2005). In addition, culture remains an embedded part of daily activities and is learnt through constant exposure to the way others behave and act in the organizational setting (Bratton, 2007). Hence, it is more of a practical experience and exposure of individuals when working in or with the organization rather than a set of laid down principles in written form. The relation of organizational culture to the perception of employees result in these shared feelings leading to a collective sense of organizational identity whereby all employees understand what is expected of them and strive to achieve those expectations (Fill, 2012). This collaborative effort leads to greater performance results and better organizational commitment through appreciation and satisfaction of management with the work of employees and the overall organization (Fill, 2012). 3 Identity and Organizational Identity Identity is defined by Hogg and Abrams (1988, p.2) as “people’s concepts of who they are, of what sort of people they are, and how they relate to others”. Deng (1995) defines identity as the definition of self by individuals and groups, and by others on the basis of distinct characteristics. Another explanation on the concept of identity suggests two possible definitions of identity. The first definition relates the concept to social underpinning and defines it as an association of an individual or a group with a social category specifically illustrated with the acceptance of its membership and recognized with the distinct characteristics associated with that category. The second definition relates to the personal identity concept revealing certain distinguishing characteristics that lead to positive self-concept and pride in ones’ self (Fearon, 1999). All these definitions, however, direct toward one common point, i.e. identity being a concept about the ‘self’ and not about other’s perceptions and beliefs about oneself (Witting, 2006). The simplest definition suggests that identity results in our recognition of ourselves. Keeping the definition of identity in view, organizational identity refers to the identity of an organization with distinct cultural and corporate objectives (Knights & Willmott, 2012).Voss, Cable and Voss (2006) provide that organizational identity is a concept internal to an organization and that answers employees of the organization on “who we are?” (Voss, Cable and Voss, 2006, p. 741). Albert and Whetten (1985) provide a clearer view on organizational identity as the idea on how the organizational members see themselves. They provide three main characteristics of organizational identity as: The widely accepted attributes that are crucial to the organization The factors/characteristics that distinguish and make the organization unique in the eyes of employees And the traits or characters that are accepted to be unchangeable and enduring by the employees despite the usual changes in the organization due to environmental factors (either internal or external). The resultant is a collective organizational identity that works efficiently to move the members of an organization in a unified direction. They tend to defend their collective organizational identity and feel more motivated to work along in order to protect the organization’s reputation, performance and preserve its well being for they identify with the organization’s success (Nutt and Wilson, 2010). 3.1 Relationship between Organizational Culture and Organizational Identity The relationship between organizational culture and organizational identity are highly interrelated (Alvesson and Sveningsson, 2008). Organizational identity, supposedly, is a by-product of organizational culture. The culture of an organization provides its members with the ability to choose between alternatives and possible courses of action using a common set of beliefs and values in mind (Alvesson, 2002). These cultural elements form an image of the organization in the minds of employees. They consider and evaluate such elements to understand who they are collectively. In addition, cultural elements like artifacts are used to communicate the identity that an organization holds to its stakeholders (Shalley, Hitt and Zhou, 2015). Organizational culture is a common set of beliefs and a shared perception that embed organizational members in a single unit. This cultural affiliation results in the development of a unified identity that results in the feelings of belongingness to the organization and its members. Hence, members feel closer to each other and to the organization as a whole. In addition, they tend to show more respect and care toward organizational policies and limitations through behavioral and attitudinal support to the organization. Further the artifacts collaborate them into a single unit bringing them together in the organizational setting and keeping them distinct from other organizations with unique characteristics like rituals, heroes, uniforms, stories and the like. Hence they form a stable identity and identification with their organization (Albert et al., 2000). 3.2 Why is Organizational Identity of Such Importance Organizational identity and a unified culture remain an important factor for the success of an organization (Bratton, 2010). The culture of an organization binds the members into one unified code of behaving and acting. Hence, this unified code forms the basis of their decisions and linkages with one another. The resultant of this phenomenon is the establishment of organizational identity that is shared across the departments and is deep rooted in the organizational structure (Bratton, 2010). People within the organization identify themselves as a part of this structure and follow the rules and meet expectations in all aspects of their working life. The importance of organizational identity lies in its ability to keep harmony between the members of the organization. Dutton (2002) provides that collective identity leads to higher employee commitment to the organization, adaptability to changing circumstances and high cooperation across the organizational levels through employee commitment and willingness to support organizational cause. In order to understand the relationship between organizational identity and organizational performance, information on the possible negative impacts on performance in case of duality and disagreement of identity is helpful. When there is a disagreement on identity, leaders tend to separate them from the work environment and their subordinates feel disowned having different treatment and expected behavior at different levels of the organization (Kreiner and Ashforth 2004). Leader’s disagreement on identity may end up creating sub-organizations with different values and thought patterns resulting in distrust, lack of commitment to the goals and stiff unhealthy competition among the groups within the organizational setting. Swann et al. (2004) suggests that identity disagreement is a whole new lot of misunderstandings and conflicts among the organizational members. Summarizing the aforementioned discussion reveals that organizational identity is made of specific characteristics that distinguish it from other organizations and are relatively permanent. In addition, a collective identity provides the basis for creating harmony between employees making it easier for them to achieve their individual and collective targets. Having a unified organizational identity motivates collective commitment and guide desired behaviors without the strong bureaucratic controls leading to deliberate attempts by employees to outperform previous results hence improving organizational performance and guide its way to success (Bratton, 2010). 4 Collective Commitment and Organizational Collective Commitment Commitment in business refers to the idea of having a firm belief in and acceptance in relation to the goals and underlying principles of an organization accompanied with an urge to strive for the success of the organization. Collective commitment, hence, is the idea of gathering and aligning commitment from the organizational members to put their best efforts in order to keep the organization moving along the path to success and recognize with the achievements of the organization for their dedication toward the organizational success. Organizational collective commitment, in simple words, is the collaborative dedication of entire workforce toward the goals and successes of the organization. Porter (1974) provides three psychological factors that establish the grounds for organizational commitment including, the desire to stay attached with the organization, the desire to put in efforts on organization’s behalf and the firm belief in organizational goals. A three-dimensional model of commitment provides moral commitment i.e. internally accepted and identified dedication to organizational aims, calculative commitment i.e. outcome oriented based upon the rewards or incentives and alienative commitment that appears as a result of limited choices or alternatives (Krishna, 2008). Either form or dimension of commitment affects job behavior and leads to improved organizational turnover ratio (Cohen, 1993). The stronger is the organizational commitment, the lesser is the chance of employee turnover and absenteeism (Singh, 2010) leading to better management of resources and eventual success of the organization with better performing employees and efficiency gains due to the ultimate emergence of citizenship behavior (Bonaparte, 2008). 4.1 Importance of Organizational Commitment to the Organization Organizational commitment helps in maintaining low staff turnover and hence, a low cost to maintain human resources in the organization. Organizational commitment yields better performance from the employees as they are more dedicated toward the collaborative goals of the organization and tend to exert more energy to achieve those goals. In addition, the competitive business environment today can protect and manage knowledge by gaining a committed workforce. Once they are committed to the organization, they are less likely to share or pass on the secrets of the business as well as less likely to leave the organization having the knowledge and experience that remains a valuable asset for organizational success (Rocha et al, 2008). Hence, organizational commitment leads to preserving and management of organizational knowledge with the development of beliefs that the organization has the right to the knowledge generated by the committed employees (Javenpaa and Staples, 2001). Furthermore, organizational commitment promotes better dissemination of knowledge and best practices across the organization leading to process improvements, reduction in resource wastages and better performance results by the organization (Cabrera, Collins & Salgado, 2006). Hence, organizational commitment leads to better organizational performance in terms of reduced costs, better knowledge management and improved performances across the organizational boundaries (McKenzie, Truch and Winkelen, 2001). 4.2 Relationship between Organizational Culture and Collective Organizational Commitment Organizational culture provides employees with a sense of identification with the organizational goals and policies. If organizational culture creates a positive impact on the employee and succeeds to attain employees’ acceptance and belief in policies, employees are more likely to be motivated to work in line with the organizational goals, improve their job security by keeping the organization to the success path and by putting additional efforts for inner satisfaction rather than to attain an external benefit for themselves. This identification, solidarity and dedication to organizational goals and policies leads to commitment that enables better performance, organizational citizenship behavior and voluntary efforts to benefit the organization from employees. Manetje and Martins (2009) reveal that the cultural paradigms of an organization lead to higher employee commitment and performance. Hence, organizational culture plays a vital role in attaining commitment from the employees that result in better performance and organizational outcomes. In terms of culture, bureaucratic culture having strict rules to be followed with little to no discretion given to employees gains and attains lesser commitment from the employees (Knights and Willmot, 2012). They do not own the organization and merely work in a mechanical fashion to fulfill their formal responsibilities. Hence, a participative cultural orientation would gain more interest of employees and motivate them to involve in decision making, participate in the fulfillment of goals and stay committed to the organization as they relate and recognize to the organizational achievements. Hence, culture influences employees in a direct manner and creates or destroys their commitment levels. Commitment, as discussed in the above section, leads to better organizational performance and results. Hence we may conclude that organizational culture develops a sense of unity and commitment in the member of the organization that results in improved performance of the organization and an eventual organizational success. 5 Conclusion Organizational culture remains the first and foremost factor that enables employees to behave, act and perceive in a certain manner. Culture affects employees routine work life and motivates them to behave in a manner expected of them. 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