Organizational Culture Is A Very Important Tool Essay Example

of civilization within an organization and explore various strategies for employee retention.

To investigate the relationship between organizational culture and employee retention in an organization.

RESEARCH QUESTIONS

What is the impact of organizational culture on employees? What strategies can be used to retain employees in an organization? Is there a correlation between organizational culture and employee retention?

SCOPE OF STUDY

This study focuses on examining organizational culture and employee retention strategies.

SUBJECT SCOPE

The study specifically looks at organizational culture and its influence on employee retention.

PERIOD SCOPE

The study encompasses the years 1998 to present day 2008.

Significance

• Businesses: This research will help organizations understand which type of culture to adopt and how it impacts employee retention.
• Fellow researchers: This study will assist researchers in recognizing the role of organizational culture, providing insights into advising different organizations on reducing employee turnover through cultural adoption.
• Individuals:This research fulfills one of the requirements for obtaining a Bachelor of Human Resource Management degree from Makerere University.

To explore how organizational culture affects employee retention, this study focuses on analyzing both concepts. Specifically, it aims to determine if there is a correlation between these two factors and what strategies can be implemented to improve employee retention within organizations. The scope of this research covers the years from 1998 to 2008. Additionally, its significance extends beyond businesses, as fellow researchers can benefit from understanding the role of organizational culture in advising organizations on reducing turnover. Furthermore, individuals pursuing a Bachelor's degree in Human Resource Management at Makerere University can fulfill a requirement by conducting this research.

STRUCTURE OF THE REPORT

Chapter one includes the introduction, background of the survey, statement of the job, purpose of the survey, objective of the survey, research inquiries, scope

of the survey, and significance of the survey.
Chapter two covers the methodology which consists of research design,data sources,data collection,data processing and analysis,data presentation,and expected limitations.
Chapter three focuses on the literature review including an introduction tothe chapter, definition of concepts,independent variable , dependent variable,and relationship between independent and dependent variables.
Chapter four involves presentation,discussion,and analysis of findings.

Chapter five presents the decision and recommendations.

RESEARCH METHODOLOGY

This chapter outlines how data was acquired, processed, and presented. It also introduces the subject of research methodology.

RESEARCH DESIGN

Descriptive research design was utilized to depict variables with qualitative data.

DATA SOURCE

Secondary sources like textbooks, journals, research abstracts, business magazines, newspapers, human resource intelligence, and the internet were employed for data collection.

DATA COLLECTION METHODS

Data gathering involved reading, writing, downloading, printing, and browsing the internet for existing information.

DATA ANALYSIS AND INTERPRETATION

The researcher conducted an initial phase of data analysis that included multiple steps.

DATA PRESENTATION

The researcher presented information in a research study to investigate the impact of civilization on consumption patterns.

LIMITATIONS OF THE STUDY

During the research, the researcher faced challenges including financial constraints and time limitations. The funding for the study came solely from the researcher, who had no other sources of income at that time. Furthermore, there was a set deadline for completing the research.

LITERATURE REVIEW

3.1 Introduction

This chapter examines the existing literature on organisational culture, the role it plays within an organization, and its impact on employee retention. Additionally, it explores various strategies that can be implemented to enhance employee retention in an organization.

3.2 Organizational CULTURE

Organizational culture refers to the customary practices and shared perceptions of members in an organization. It develops gradually over time and may not always be

consciously acknowledged by employees. Nevertheless, organizational culture is important as it influences how employees view their jobs and carry out tasks within the organization.

According to Schein (1999), organizational culture is a shared set of basic beliefs that a group learns as it solves its problems of external adaptation and internal integration, which has proven to be effective and is therefore taught to new members as the correct way to perceive, think, and feel in relation to those problems. Organizational culture can also be defined as: "A system of shared values and beliefs about what is important, what behaviors are important, and about feeling and relationship internally and externally." (Purcell et al, 2003)

Organizations now recognize the importance of articulating and emphasizing their core beliefs due to increased attention given to managing culture. While all organizations have a culture, some may seem more deeply rooted than others. Initially, a strong culture was defined as a set of beliefs, values, assumptions, and practices embraced by most organization members.

The main focus was on the grade of consistency of beliefs, values, premises, and patterns among organizational members. The concept of consistent beliefs, values, premises, and patterns.

THEORIES OF ORGANIZATIONAL CULTURE.

According to Denison (1990), there are four different perspectives on how organizational culture functions. These perspectives are translated into four different hypotheses. The consistency hypothesis suggests that a shared perspective, common beliefs, and communal values among organizational members will improve internal coordination, promote significance, and create a sense of identification among its members. The mission hypothesis proposes that a shared sense of purpose, direction, and strategy can unite and motivate organizational members towards common goals.

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two hypotheses related to organizational commitment and effectiveness. The involvement/participation hypothesis suggests that engagement and involvement contribute to a sense of duty and ownership, resulting in organizational commitment and loyalty. On the other hand, the adaptability hypothesis claims that norms and beliefs that help an organization interpret and respond to environmental signals will promote its survival, growth, and development.

TYPES OF CULTURES.

In 1995, Charles Handy identified four different types of cultures within an organization: power culture, role culture, task culture, and person culture. It is possible for one of these cultures to dominate the entire organization, or different cultures may coexist in different parts of the company. For example, a small business may start with a power culture from a single source and later expand.

The text emphasizes the presence of regulations, processes, and commissions in a bureaucratic organizational culture. It suggests that important decisions are made by a small group of individuals and cases are closely followed. A bureaucratic culture operates through formal roles and procedures, with clearly defined rules for resolving conflicts. While organizations with a role culture provide security and predictability, they are not easily adaptable to change due to their rigid structure. On the other hand, a task culture focuses on jobs or projects.

Every organization has its own unique culture that exists within it. Within every organization, there is no single dominant leader as all members of the group are focused on completing their corporate tasks. The culture within the organization encourages a flexible approach and is well-suited for environments that are constantly changing. This leads to high job satisfaction and strong group cohesion. In some organizations, a team may emerge with the

sole purpose of serving the individuals within it, such as partnerships, consultancy firms, and other professional entities.

The influence of organizational culture on decision-making processes and leadership styles is evident in different cultures. In a functional culture, the leader of the organization has exclusive power to make decisions. Consequently, ideas from others may not be embraced if they do not align with the preferences of the leader, as seen in human resource policies (Cameron and Quin et all 1999). The organizational culture determines the suitable style of leadership to utilize, requiring leaders to understand and navigate it effectively in order to prevent conflicts within the organization. For instance, an authoritarian leadership style would be unsuitable in a project-oriented culture.

( Schein et al 1999 ) . Organizational culture gives employees a sense of individuality as it is a shared set of beliefs, making them aware that they can only act in a certain way within their organization. Additionally, ( Schein et al 1999 ) mentions that organizational culture contributes to coordinating and integrating different units within the organization, leading to improved efficiency, quality, and speed in planning, manufacturing, and delivering products and services. ( Kathryn A.

Baker (2002) found evidence supporting the idea that employee engagement is linked to improved organizational performance. Specifically, there was a positive correlation between higher levels of employee engagement and better performance within organizations. Employees who were involved in decision-making processes performed better than those who were not consulted.

STAFF RETENTION.

Staff retention is an important aspect of a broader concern that includes recruiting, retaining, and developing the necessary skills to achieve organizational objectives (Clarence; Alex 2004). In this case, staff retention can be defined

as "the qualities that employees perceive as beneficial to them and that create a stronger connection to their job and commitment to the organization."

According to Derek Torrington (2005), the cost of recruiting and developing a new employee typically ranges from 0.5 to 1.5 times their one-year wage for the position they are being hired for, depending on the methods used (Thompson, 2000). In today's competitive environment, where there is a high demand for talented individuals and limited availability, it is crucial that employers devise strategies to attract the right people and retain high-performing employees.

REASONS WHY EMPLOYEES LEAVE ORGANIZATIONS.

Employees leave their positions due to various reasons, many of which are beyond the organization's control.

Retirement is a common reason for leaving an organization, regardless of how much it is promoted or advocated. There are multiple reasons why individuals voluntarily leave their jobs, and one way to classify the main reason is through job satisfaction. Turnover studies (Mobley et al 1979) have shown a clear relationship between job satisfaction and turnover. These studies indicate that overall job satisfaction has a negative association with turnover, and individuals often leave their employer to find more interesting work elsewhere. It is generally agreed upon that the impact of job satisfaction on turnover is not as significant as organizational commitment, rewards, and conditions.

According to Griffeth et Al (2000), wage and pay related variables have a significant impact on turnover. They determined that if a high performer is not sufficiently rewarded, they will leave, and when corporate wages plans replace individual incentives, this can lead to higher turnover among high performing individuals. Mobley et Al (1979) conducted several studies and found a negative

relationship between satisfaction with supervision and management, resulting in lower staff turnover. Torrington (2005) explains that turnover can also be influenced by pull factors, which refer to the attraction of an employee by rival employers.

Employees often leave to pursue better quality of life and career development opportunities in new countries. They seek better chances for work and advancement that may not be available with their current employers.

STAFF RETENTION STRATEGIES.

The most effective way to retain staff is to offer them a trade-off that is more beneficial than what they perceive they can get from other employers. Organizations should make better use of these strategies to prevent their high-quality employees from being poached by competitors. The following strategies can help in retaining employees. Managing expectations is crucial, as potential employees should have a realistic job review before accepting a job offer. This is necessary to ensure that new staff members find what they were expecting from the job and organization.

Realistic job previews are essential when candidates do not know how a job operates and how the organization they want to join runs (Sturges and Guest, 1999). Effective and timely onboarding is also often attributed to reducing turnover in the early stages of employment. The purpose of onboarding is to prepare an employee to work as effectively as possible and help newcomers adjust emotionally to their new workplace.

Induction is an important process that ensures that new employees understand the connection between the organization's values and culture. It provides a platform to communicate basic information about the organization, such as its mission statements, visions, health and safety regulations, and other relevant details. The key aspect of induction is introducing

individuals to both the organization as a whole and their specific roles within it (Torrington 2005). Additionally, implementing family-friendly HR practices can be effective in employee retention.

It is crucial for both employees and organizations to strike a balance between work and personal life. Offering work-life balance opportunities is a way for organizations to demonstrate their concern for their employees, which can include practices such as flexible scheduling and paternity leave (Armstrong 2004). Training and development of employees is also an effective strategy for employee retention.

Training opportunities increase the commitment of individual employees to the organization, making them less likely to leave voluntarily compared to those who do not receive training. When employees know that their organization is willing to help them develop, they are more likely to stay with that organization (Torrington 2005). Enhancing the quality of frontline management and leadership also plays a significant role. Dissatisfaction with supervisors is often the main reason behind voluntary resignations. This indicates that the most effective way to reduce staff turnover in an organization is to improve the performance of line managers. The management assumes that these managers are competent supervisors, as the role can be challenging and does not come naturally to everyone.

After evaluating their supervisory achievements, it is recommended that line directors be selected. In addition, it is essential to ensure that newly appointed line directors receive training in effective supervision and regularly assess directors in order to inspire others. Payment levels are regarded as the final and most crucial element in this study. According to Gomez - Mejia and Bakin (1992), employers who provide attractive remuneration packages experience lower rates of employee turnover compared to

those who pay poorly. Thus, many organizations rely on wage rates as a primary tool for retaining employees. While increasing salary levels can lead to increased job satisfaction among content employees, it will not prevent dissatisfied employees from leaving. For employees, a challenging job compensates for a lack of pay, as pay can never compensate for a mundane and uninteresting job (Sturges and Guest et al., 1999).

3.9 RELATIONSHIP BETWEEN ORGANIZATIONAL CULTURE AND STAFF RETENTION.

The connection between organizational culture and staff retention is evident in many organizations. An organization that possesses a strong and employee-friendly culture is able to retain its employees, thereby reducing the cost of labor turnover (Torrington 2005). Employees prefer to stay in an environment where they feel comfortable. Organizations with a transformative culture tend to retain their younger employees, who are valuable for their fresh ideas. This is supported by the fact that younger employees enjoy exploring new opportunities, and if an organization fails to provide them with such opportunities, they are likely to leave. To combat this, an organization should foster a culture that makes it difficult for employees to leave. One effective strategy is to cultivate a sense of community among the workforce.

The text highlights the importance of fostering various out of work activities like sports teams and investment clubs to increase staff retention in organizations. It provides an example of Kitgum concerted savings and credit bank limited in Uganda where female employees have investment clubs. Additionally, creating closely knit teams within the company promotes reliance and makes it difficult for employees to leave. The text suggests that organizations with authoritative leadership may struggle to retain open-minded employees. This

discussion emphasizes the relationship between organizational culture and staff retention.

Introduction

The purpose of the study was to investigate the impact of organizational culture on staff retention and explore the relationship between the two factors.

Organisational civilization and staff keeping are the main focus of this study, inspiring the following three aims:

• To examine the role of culture in an organisation.
• To identify effective strategies for retaining employees.
• To establish the relationship between organisational culture and employee retention.

Findings on the Role of Organizational Culture in an Organization

Organizational Culture

Schein (1999) defines organisational culture as a shared pattern of basic assumptions that a group learns while solving its external adaptation and internal integration problems, and that has worked well enough to be considered valid and therefore taught to new members as the correct way to perceive, think, and feel in relation to those problems. In contrast, Parcell et al. (2003) define it as a system of shared values and beliefs about what is important, what behaviors are important, and about emotions and relationships both internally and externally. Based on these definitions, it can be concluded that organisational culture represents what an organisation deems correct and passes it on to its members, enabling them to understand the expected attitudes and behaviors within the organization, as well as reporting structures and hierarchies.

Many definitions of civilization prioritize cognitive elements, such as premises, beliefs, and values, as well as behavior and artifacts. This leads to the conclusion that there are visible and hidden levels of organizational culture, as illustrated in Figure 1: Degrees of Organizational Culture (Adapted from Schein 1980; Schein 1985). Thus, Schein derives his definition of organizational culture

from these levels. Initially, organizational culture was seen as a means of enhancing internal integration and coordination. However, the open system perspective of organizations recognized that culture is also important for adapting to the environment. The traditional perspective of a strong culture could hinder the organization's ability to adopt and change. Considering culture's significance in facilitating organizational innovations, accepting new ideas and perspectives may require a different outlook on organizational culture.

Denison (1990) proposed four distinct hypotheses of organizational culture: the consistency hypothesis, the mission hypothesis, the participation/involvement hypothesis, and the adaptability hypothesis. These hypotheses focus on different aspects of culture but, more importantly, they emphasize different functions of culture. The consistency and mission hypotheses promote stability, while the participation and adaptability hypotheses allow for change and flexibility. The consistency and participation hypotheses view culture as centered on internal organizational dynamics, while the mission and adaptability hypotheses consider culture in relation to its external environment.

• Stability and control.
• Change and flexibility.
• Internal.
• Consistency.
• Engagement.
• External.
• Mission.
• Adaptability.

In line with this perspective, Charles Handy (1995) also identifies key types of organizational culture that correspond to different types of organizations. However, Handy approaches it from the viewpoint of employees or people, unlike Denison (1990) who focuses on the organizational perspective. According to Handy, organizational culture can be divided into four parts:

The power civilization, the function civilization, the undertaking civilization, and the people civilization all play different roles in an organization. The power civilization, which involves decision-making by a small group of people, may not be suitable for a growing company that wants its employees to feel like they are part

of the organization. In this case, Denison et al.'s engagement hypothesis would be more appropriate. The organizational culture should be transformational, meaning it can adapt quickly to change. Therefore, Handy's role culture theory of organizational culture does not apply to a company that wants to compete in today's market. According to Schein (1999), organizational culture is more important now than it was in the past due to increased competition, globalization, mergers, acquisitions, partnerships, and diversity in the workforce. Organizations are now focusing on having the right leaders in their executive boards who can assess the performance and impact of the culture on employees' attitudes and performance.

According to Cameron and Quin et al. (1999), organizational culture influences decision-making processes. Handy (1995) further explains that different types of culture, such as task culture, involve team members making decisions collectively, resulting in higher job satisfaction as they feel like part of the decision-making process. According to Schein et al. (1999), organizational culture should determine the type of leadership required. When a new manager is brought in, they can use Denison's (1990) categorization of culture to align the organization's mission and vision. This ensures that the manager implements a culture that is in line with the organization's objectives, avoiding conflicts and promoting smooth operations. Additionally, Backer (2002) argues that organizational culture enhances effective coordination and integration among different units within the organization.

An organization requires shared basic rules in order for its units to organize and demonstrate the importance of civilization within the organization.

Employee Retention Strategy Findings

The employee retention strategy is the approach taken by a company to retain its employees. Prior to developing

strategies, the researcher first identified the reasons why employees leave their organization. Among the findings, it was discovered that employees leave due to retirement. Although retiring employees may be older, many of them are experienced, and thus the organization loses valuable workforce. This issue can be addressed by extending the retirement age for high-performing employees.

Job satisfaction plays a significant role in labor turnover, with many employees leaving their workplaces due to dissatisfaction with their current circumstances. Over time, employees may become bored with their repetitive jobs, leading to reduced productivity and prompting them to seek more challenging opportunities elsewhere. Another reason for employees leaving organizations is inadequate compensation. If an employee is paid less than their counterparts in other organizations in similar positions, they are likely to leave in search of a better-paying job elsewhere. It is also crucial for an employee to work in an environment where compensation is fair, equitable, and linked to performance.

Staff turnover has been associated with the relationship between supervisors and directors and their employees. Mobley found that if employees are satisfied with their supervision, they will be more productive and comfortable in their workplaces. Therefore, it is crucial for supervisors and line managers to receive training in supervisory skills to reduce staff turnover caused by them. Additionally, attracting factors also contribute to increased labor turnover.

The attraction of an employee to a rival company can be influenced by the public image of that company in the market. For example, MTN employees may be drawn to work for Safaricom Kenya due to its impressive successes, such as its 17 billion shilling pre-tax profit and its ranking as one of

the top telecommunications companies in East and Central Africa. However, it is important for organizations to manage expectations and provide potential employees with a clear picture of what to expect. This is because when employees have unrealistic expectations and later realize that their work does not align with what they wanted, they may become disillusioned.

The research uncovered the significance of household-friendly human resource practices in promoting employee commitment. Organizational employees who have the ability to balance their work and family lives showed higher levels of dedication compared to those who lack such programs. Additionally, training and development programs were identified as crucial for retention purposes. Implementing personalized development plans for individuals based on their abilities and needs, regardless of their position within the organization, can effectively enhance employee retention. Moreover, providing opportunities for talented individuals to enhance their skills further increases the likelihood of them staying.

Findings on the Relationship Between Organizational Culture and Staff Retention.

The study found that organizational culture directly affects staff retention. Organizations with authoritative leadership styles, unfair compensation, disorganized work flows, and limited employee involvement in decision-making processes have high turnover rates. Additionally, environments where line managers abuse their authority and fail to address sexual harassment issues also struggle with retaining good employees. The study concluded that staff retention is closely tied to organizational culture, as employees seek a balance between their professional and social lives in a comfortable work environment.

Work life balance is one of the factors that contribute to employees staying in their jobs. It is important for every organization to embrace transformational change and be prepared for the rapid changes in the business

environment. During this process, employees should be well-informed about the changes so that they are not caught off guard.

Summary of Findings, Conclusion and Recommendations.

Introduction.

This chapter provides a summary of the findings, conclusion, and recommendations.