How organisational culture improves organistional performance?

Answer 1

Sociotechnical systems theory and quantitative research suggests an important relationship between organizational culture and business performance. The important factor is an alignmentbetween the organizational culture and technical systems (the way the work is done).

Where there is a lack of alignment, project cancellation is likely. Where alignment is present, project completion is likely. Cultural alignment, however, is not sufficient to ensure success, as technical systems factors influenced project performance. Having the most appropriate organizational culture is helpful, but you must still do the work effectively to achieve organizational performance.

The literature suggests disagreement with regard to the nature of the relationship between organizational culture and business performance. The strong performance perspective suggests that business success drives changes to the organizational culture. Alternate theories suggest that a strong organizational culture drives business success.

Quantitative studies identified a strong correlation between organizational culture and business performance. The correlation suggested a relationship between variables but does not establish which causes the other to change. An analogy of this dilemma is that statistical analysis may indicate that shark bites are strongly correlated to air temperature, but the cause of increased shark bites may not be air temperature, but rather that more swimmers go in the water in higher temperatures.

Organizational culture establishes the way things are done in an organization. Typically those strategies that have worked in the past are repeated. Successes are celebrated in the myths and stories of the organization reinforcing their apparent correctness. In this way organizational culture can drive organizational performance by ensuring that successful strategies are repeated.

Organizational culture can also be a barrier to change when environmental factors require new strategies. In some instances, previous strategies are no longer relevant, or even harmful. Organizational culture would drive members to continue doing things in the same old ways, rather then encouraging members to adapt new behaviors.

To achieve optimal organizational performance, and organization has to focus both on the organizational culture, and the technical systems that define the way work is done. You have to optimize why the work is done in a certain way (organizational culture) and how the work is done (technical systems).