Academic journal article Iranian Journal of Management Studies

On the Effects of Organizational Culture on Organizational Performance: An Iranian Experience in State Bank Branches

Academic journal article Iranian Journal of Management Studies

On the Effects of Organizational Culture on Organizational Performance: An Iranian Experience in State Bank Branches

Article excerpt

Introduction

Every organization needs an evaluation system in order to be aware of its sub-system activities. Institutions, organizations, and executive agencies with every mission, goal, or vision are responsible for accountability to stakeholders (Morevati Sharif Abadi, 2005). Banks as organizations are not exceptions; however, available methods of performance evaluation reveal that these methods are empirical and entail just financial ratios without enough attention to the role of nontangible aspect of organizational (Amiryoussefi & Hafezi, 2007).

Despite the large number of ideas over the influence of culture on organizations performance, there are a small number of researches conducted in this respect (Gillespie, Denison, Haaland, Smerek, & Neale, 2008). In the recent years, organizational culture has been studied more than ever and more attention has been paid to the relationship between some variables such as productivity, organizational structure, style of leadership, efficiency and effectiveness. Therefore, according to the considered claims in this context, studies following this problem regularly have twofold benefits:

* In theoretical aspects, regarding small number of studies, this article helps to clarify the hidden dimensions of organizational culture and has an important role in scientific breakthroughs for achieving valid results.

* In practical aspects, if the link between the cultural characteristics and the organizational performance is sufficiently defined, applying mentioned tips will boost organizational improvement (Zahedi, 2002).

Iranian banks are confronting various financial and structural problems. Hence, comprehensive reforms are essential to achieve a dynamic economy (Samdaliri, 2002). Despite the importance of Iranian banks in their financial markets, from the perspective of performance, they are not desirable (Samdaliri, 2002; Afsharkazemi, Setayesh, & Mehrabian, 2006). The present empirical investigation focuses on clarifying the role of organizational culture in the performance of state banks in Bushehr city. By utilizing Denison culture model, cultural position of each branch is determined; then, performance evaluation is performed. In the next phase, after investigating these two variables, the type of relationship and intensity of cultural effects on performance is clarified.

Literature review

It has been nearly two decades since the theorists and scholars of management and organizations, especially experts and specialist in the field of organizational behavior and organizational transformation proposed an issue in the organization that is not concrete and tangible. This issue was surveyed mostly by warren Bennis, Edgar Shein, and William Ouchi and has been manifested by Peters and Waterman's book "in the search of excellence". This important issue was called "organizational culture" and has been surveyed as the nontangible aspect of organizational studies (Jean Lee & Yu, 2004).

Organization concepts including organization culture is difficult to define and like many of the terms in humanities renders no unified and clear-cut meaning. Available definitions of culture are so various and numerous that there are more than 200 definitions of culture (Hatch & Cunllife, 2010; Keynejad, 2005). However, its understanding is more difficult than defining it (Borjan Brubakk, 1996). Martin (1988, 1990) and Wallch (1983) also have presented various definition of culture (Jean Lee & Yu, 2004). This point is true about culture definition in national level, too. The beginning of formal writing on the concept of organizational culture started with Pettigrew (1979). He introduced the anthropological concept of culture and showed how related concepts like "symbolism", "myth", and "rituals" can be used in organizational analysis. Dandridge et al. (1980) showed how the study of these myths and symbols aid in revealing the "deep structure" of an organization (Jean Lee & Yu, 2004). …

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