A Study On Organizational Climate Business Essay Example

determining its openness or resistance to change from both internal and external sources. It also influences how effectively an organization can adapt to these changes or developments (Brown & Brooks 2011). When organizations prioritize worker satisfaction, employees will align their behavior with achieving organizational goals. This paper focuses on the fabric industry and presents findings, deductions, and recommendations for improving the organizational climate in textiles companies. Key concepts covered include employee relations, leadership styles, organizational climate, and wage systems.The concept of organizational climate was initially mentioned by Lewin, Lippitt and White (2010) who emphasized the role of leaders in creating a favorable climate. It is the climate within an organization that plays a crucial role in determining its openness or resistance to change, both internal and external. Additionally, it influences how well an organization can adapt to these changes or developments (Brown & Brooks 2011). According to McMurray (2012), organizational climate refers to the collective perception and understanding of all members regarding the structure, systems, and patterns of the organization. Ostroff (2011) states that there is a strong correlation between organizational climate and performance. The way employees perceive their work environment greatly impacts their attitudes, behaviors, satisfaction levels as well as turnover rates, adaptation to change, and overall stability. Numerous studies have investigated this relationship consistently finding that positive perceptions result in increased involvement in decision making, information sharing, and support from management leading to improved effectiveness. Researchers widely agree on the significant impact of positive climates on work attitudes, behavior, and overall performance. When employees feel satisfied with the climate because their performance expectations are being met they are able to effectively fulfill their

tasks.Organizations can promote behavior aligned with their goals by prioritizing the well-being of workers. Positive workplace conditions have been found to enhance work behavior. Litwin and Stringer (2010) initially identified nine dimensions of organizational climate, including Structure, Responsibility, Reward, Risk, Warmth, Support Standards Conflict Identity. Jones and James (2011) later added six dimensions to assess organizational climate: Leadership facilitation and support, Workgroup cooperation, friendliness and warmth, Conflict and ambiguity Assessing organizational climate, Professional and organizational spirit, Job challenge importance and variety, and Common trust. Different researchers have used various dimensions to evaluate organizational climate.

A literature review conducted by Austin (2009) revealed that having critical friends has a positive impact on job satisfaction and perceptions of career advancement. This suggests that building critical relationships in the workplace is important as friendships influence job satisfaction and career growth.

According to Bassous (2010), there is a positive correlation between workers' motivation level and nonmonetary incentives, leadership style, and organizational culture. However, there is no significant relationship between workers' motivation level and monetary incentives.According to Edwards Buckingham & DemetriaA (2010), workplace diversity, which includes gender, race, and ethnicity, can potentially impact diversity consciousness. Their findings also show a moderate relationship between diversity consciousness and employee job satisfaction. Hrobowski-Culbreath (2010) conducted a study on the relationship between flexible work arrangements, job satisfaction, productivity, and work-life balance. They found that flexible work arrangements are associated with turnover, absenteeism, job satisfaction, productivity, and work-life balance [source]. Jagusztyn (2010) [12] discovered that poor environmental conditions contribute to negative workplace attitudes and health outcomes due to increased perceived discrimination. Markham and Leann Mills (2009) found in their research that IT employees find the work itself

and their occupation in general as the most satisfying aspects. They also concluded that the number of years of work experience does not significantly impact overall job satisfaction [13]. In a study by Michael W. Grojean et al. (2004), they explored the important role organizational leaders play in establishing a values-based climate within an organization. Through their research, they identified seven mechanisms used by leaders to communicate ethical values and set expectations for ethical behavior within the organization's climateThe mechanisms that leaders use in various positions ultimately impact the practices of members and enhance ethical values. This leads to the formation of shared perceptions that shape the climate of the organization [14]. In 2010, Jennifer Parker Ayers conducted research showing a significant link between job satisfaction, job engagement, and organizational commitment among educators. Specific aspects of organizational communication, as identified by Paul M. Muchinsky (1977), have a strong correlation with both organizational climate and job satisfaction. Effective communication between supervisors and employees, as highlighted by Pincus (1986), results in increased job satisfaction and alignment with company goals. Russell E. Johannesson (2011) utilized a 90-point questionnaire to assess organizational climate. Soumendu Biswas (2010) discovered that psychological climate has a positive impact on job satisfaction and engagement but negatively affects turnover intention. Furthermore, turnover intention adversely affects organizational effectiveness. LaNettae Scott's (2010) findings suggest that an organizational culture and climate promoting learning leads to knowledge retention and application.Schneider and Hall (2010) defined organizational climate as the shared perceptions of individuals about their work environment, influenced by personal and organizational factors. According to Schnake (2011), emotional responses have an impact on how employees perceive the organizational climate. Wietzel

(2009) conducted a study on federal employees, using Pearson correlation analysis, Chi-square testing, and multiple-regression analysis to examine the relationship between job satisfaction, education level, management styles, and performance. The results showed that enhanced performance is associated with an organizational culture influenced by factors such as salary, employee development, feedback,and motivation from supervisors. In India's cotton and fabric industry, which is globally recognized as the second largest employer after agriculture, it is also known as the third-largest cotton producer contributing 25% of its cotton exports to world trade. A study by the Alliance of Indian Industry-Southern Region revealed that textile projects in Andhra Pradesh received the highest investments this year followed by Tamilnadu in second place and Karnataka and Kerala in third and fourth places respectively.According to The Hindu (2006), the Guntur territory in Andhra Pradesh has attracted an estimated investment of Rs 33.79 billion for promoting new industries, specifically fabric industry hubs, which have been encouraged by provincial authorities. Currently, there are 50 operational mills and an additional 50 mills under construction, as reported by the A.P Cotton Millers Association. For this research project, the selected mills include Amravati Fabrics, Kallam Spinning Mills, Guntur Spinning Mills, NSL Fabrics, and Idupulapadu Textiles.

Convenience sampling was used by the researcher to collect data on employees' perception of the organizational climate. This method took into consideration factors such as availability and cost. The main objective of the research question is to examine how the organizational climate influences employee engagement and commitment within the organization.

Previous studies have highlighted a correlation between organizational climate and employee performance, emphasizing the importance of creating a conducive climate for employees. However, understanding employees'

preferred climate can be challenging due to variations in perceptions over time and situations. Therefore, it is crucial to continuously monitor and evaluate employees' perceptions through surveys and studies in order to gain insight into their views towards organizational climate.Academics play a crucial role in contributing literature to help organizations bridge the understanding gap. Despite previous attempts by researchers to study employees' perception of organizational climate, there is still a lack of academic knowledge in this area. In order to address this gap, this study focused on fabric companies in Andhra Pradesh and aimed to analyze employees' perceptions of the organizational climate and investigate their opinions on various climate variables. The objective was to explore the relationship between different organizational climate factors and employee demographic variables. Based on the findings, decisions and recommendations will be made. The null hypothesis indicates that there is no significant association between employee demographic factors and their perceptions of organizational climate variables. The methodology involved collecting primary information through surveys using a structured questionnaire with both optional questions and Likert scale statements ranging from strongly disagree to strongly agree. A total of 125 questionnaires were distributed, resulting in a sample size of 110 after removing 15 unusable ones. Primary information was collected through random sampling, while secondary information was obtained from various sources such as journals, magazines, publications, reports, books, dailies, periodicals articles research papers websites company publications manuals and booklets.

Data Analysis

The survey goals were achieved through various analyses such as descriptive statistics with chi-square test of independence (??), analysis of variance (ANOVA), regression analysis, and correlation analysis between the survey variables. The results can be found in the

tables below.

Reliability Analysis

Prior to conducting further data analysis, the researchers tested the internal consistency of the data using Cronbach's coefficient alpha, which is a commonly used method for reliability testing. Table 1 titled "Reliability Statistics" displays a coefficient of 0.870, indicating a high level of consistency in our measurement.

Table 1: Reliability Statistics

Source: Primary data

Descriptive Analysis

The table provided below presents the socio-economic profile of respondents within the surveyed area. Among the respondents, 64% fall within the age group of 18 to 30 years. Approximately 31% are aged between 31 and 40 years, while only a small percentage (5%) belong to an age group above 40 years.

In terms of educational qualifications, 38% have completed their education up till grade 10, while 26% hold a diploma. Additionally,16% possess a degree and remaining19% are postgraduates.

When considering occupational experience, it was found that56% have more than five years of experience whereas44% have less than five years.The majority (85%) earns below Rs.8000 rupees per month with only15% earning above this amount.
The majority of respondents in this study are male (57%) while females account for 43%. The purpose of the study is to analyze how gender, age, education level, and industry experience impact perception of organizational climate in the fabric industry. Through a one-way analysis of variance (ANOVA) at a significance level of 0.05, it was determined that there is a significant relationship between organizational climate and experience. The calculated value of "F" exceeded the table value for various variables such as welfare facilities provided by the organization, interpersonal relationships, decision-making processes, recognition and rewards for knowledge and expertise, management respect for worker representatives, and reward systems for different types of

work. However, working conditions were not considered important based on survey results with a p-value of 0.200 higher than the significance level of 0.05. Glisson & Durick (1988) discovered that employees who have been in their job longer and are older tend to be more satisfied compared to those with less experience or younger employees. According to Markham & Leann Mills (2009), IT employees find high satisfaction in their work itself. Overall job satisfaction is not significantly affected by years of work experience indicating that employee experience influences satisfaction levelsThe analysis presented in this text disproves the null hypothesis that suggests no impact of individual variables on organizational climate variables. This finding underscores the importance of acknowledging differences in respondents' experiences. Table 4 displays a strong relationship between organizational climate and education, with statistical significance at a level of 0.05%. The "F" value within this table represents various factors, such as public assistance installations, relationships with others, decision-making processes, organization recognition, friendly interactions with other departments, and recognition and rewards for knowledge and expertise.

Furthermore, management values worker representatives during meetings and implements systems to reward different types of work. However, the organization does not consider working conditions as important. A study conducted by Zulfqar Ahmad et al.in 2010 reveals noteworthy disparities among middle managers' perceptions regarding political climate, professional development opportunities, and respect for personal concerns between local and transnational organizations.

Additionally, the analysis highlights the influence of employee education on organizational climate variables. As a result, the null hypothesis suggesting no impact of personnel variables on organizational climate is rejected. Consequently, it can be concluded that there is a significant difference in how respondents perceive

the influence of education.The researcher utilized Karl Pearson's Coefficient of Correlation to accurately measure the strength and variability of the relationship within the organizational climate. The table below demonstrates strong correlations between specific variables that can significantly impact employees' experience of organizational climate, including:

- The decision-making process and relationship with others (0.945)
- Recognition and reward for knowledge and expertise, as well as reward systems for different types of work (0.942)
- Reward systems for different types of work, and management's consideration of worker representatives in meetings (0.929)

From this information, it is clear that the decision-making process and relationship with others have the highest level of intercorrelation (r=0.945). These two variables greatly influence how respondents perceive their organization's climate. Employee involvement in organizational decision-making serves as a motivation source to achieve desired results. Positive relationships with others also play a role in influencing employee relations and optimizing organizational performance [24]. According to Tengku Marini's study in 2007, male staff generally have a more favorable perception of the organizational climate compared to females. Staff members are known for their friendly, precise, and attentive communication style, while the prevailing organizational climate is achievement-oriented.In relation to survey variables, there is a strong correlation (r=0.942) between reward systems for various types of work and recognition of knowledge and expertise, as observed in the study conducted by Bassous (2010). The research revealed that workers' motivation levels are positively correlated with non-monetary incentives, leadership style, and organizational culture. However, no significant relationship was found between workers' motivation levels and monetary incentives. It is vital for organizations to acknowledge employee accomplishments and expertise through an impartial performance assessment system.

Both reward systems and the

inclusion of workers' representatives in decision-making meetings (r=0.929) can impact the overall organizational climate. To ensure employee engagement in decision-making processes, management should establish a peaceful work environment and implement strategies such as joint management councils, works commissions, and works councils.

The summary of Table: 6 demonstrates the extent to which the model used in this research explains the difference in the dependent variable (Experience).The text discusses a research model that considers various variables within an organization, such as working conditions, assistance facilities, relationships with others, decision-making processes, recognition from the organization, cooperation with other departments, reward systems, respect from management towards worker representatives, and acknowledging knowledge and expertise. The value obtained for this research is .898 which means that the model explains 89.8% of the variation observed in experience among individuals. To determine if these results are statistically significant or not, ANOVA Table 7 needs to be referred to. This table tests the hypothesis that the multiple R in the population is equal to 0. The research model demonstrates statistical significance (sig.= .000; p < .0005). Table 8 displays the coefficients matrix and provides insight into each variable's contribution through Standardized Beta coefficients. A high value indicates a significant effect on the standard variable when there is a unit change in this predictor variable. The "T" and Sig (P) values indicate each predictor variable's impact. If there is a high correlation with other variables present,it may indicate multicollinearity. The importance of reward systems for different types of work in explaining the dependent variable is emphasized, as it has the largest Beta coefficient at 0.071. This significance remains even after accounting for other variables in the model.

Other factors that contribute significantly to explaining discrepancy degree include working conditions in the organization (0.603), decision-making process (0.589), and recognition and rewards for knowledge and expertise (0.540). Table 9 presents average scores using a weighted mean method, showing a slightly positive level of organizational climate within the organization. Working conditions have the highest average value (3.87), indicating high satisfaction among respondents. Despite some room for improvement, it is notable that the average value remains high. This information is accurately depicted in the table above, which also includes X2 analysis of all corresponding variables. Mean scores analysis reveals that all variables are statistically significant at a 0.001 percent level and positively related to organizational climate.

The trial of hypotheses demonstrates a connection between employee demographic factors and the organizational climate variable, as evidenced in Table 3 and 4 where employee experience and education surpass the table value for all variables. Additionally, Table 5 highlights significant correlations among organizational climate variables. Chi-square analysis was conducted on these variables to test Null Hypotheses, resulting in significance at a 0.05 percent level for all variables. The analysis in Tables 8 reveals a significant relationship (at a 0.05 percent significance level) between demographic variables and organizational variables. The researcher's findings reject the null hypotheses, indicating that employees' perception of organizational climate is influenced by their demographic factors.

The survey results display employees' perceptions regarding various organizational climate variables such as working conditions, welfare facilities, employee skills, employee involvement in decision making, employee recognition, and friendly employee relations. The results indicate that 79% of respondents are content with the working conditions while only 45% express dissatisfaction with welfare measures, highlighting the need

for improvement in this aspect. Furthermore, there is strong agreement (36%) that organizational facilities have improved relationships among employees and agreement (39%) that management values employees' opinions in policy-making.In addition, there is a cooperative and friendly environment between departments. However, it is important to note that 43% of employees disagree with the organization's compensation program, indicating a need for change. According to Joseph Wallace et al. (1999), implementing a collective bargaining process could be a potential solution to address this issue and show respect for employees' unique skills. The authors also found strong connections between specific aspects of organizational climate and various dimensions of managerial values, as well as relationships between culture, climate, and managerial values.

In the fabric industry, factors such as a favorable work environment, positive recognition, organizational relationships, effective supervision, and core values are crucial in motivating employees. Satisfaction, motivation, training, and leadership qualities are all influenced by the organizational climate. Different departments have different descriptions of their climates (e.g., accounting department versus service department versus funding department).

The study highlights that an employee's perception of the organization's climate and emotional reactions to their work situation are greatly influenced by their experience within their functional work group. Therefore,, transparent and sufficient communication plays an essential role in ensuring smooth employee performance. Effective communication between supervisors and employees leads to a shared understanding of goals and the company's direction.Employees who receive information from their supervisors tend to have higher job satisfaction. According to Newman (2010), positive working conditions, such as motivation, a welcoming environment, differential wages, orientation for new employees, cooperation among colleagues, occupation variety, growth opportunities, supportive monitoring, and teamwork are significant factors that

influence employee perceptions of their jobs and increase satisfaction and commitment to the organization. To foster this type of climate, the organization should support work groups and promote teamwork. Involving employees in decision making is also important for enhancing communication and achieving organizational goals (Pathak et al., 1993). Glisson supports these ideas without mentioning a specific date. Moreover, Durick's (1988) study found that skill variety and function ambiguity are the best predictors of job satisfaction while leadership and organizational age predict commitment. However,

there are limitations in this study as well as future opportunities for exploration:

Further investigation should prioritize collecting additional data on the organizational climate.