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A Study on Organizational Culture and Its Relationship with Job Satisfaction in
Manufacturing and Information Technology Sectors
Dr. Koteswara Rao, Dr. P.T.Srinivasan and S.George
Dr.P.K.Kotewara Rao is a senior executive in Southern Railway
Dr.P.T.Srinivasan, professor, Department of Management Studies, University of Madras
S.George, doctoral research scholar in Management, university of Madras
ABSTRACT
Organizational culture has a significant effect on how employees view their organizational
responsibilities and their job satisfaction. With increasing globalization, a greater
knowledge of organizational culture and its effect in non-western cultures can be beneficial
for practicing leaders and decision makers. This study explores the association between
organizational cultural values and employee satisfaction in manufacturing and Information
Technology companies in India. Surveys were distributed to 4 manufacturing companies
and 4 IT companies. The sample size was 461. Significant findings are: (1) Organizational
culture differs in terms of the mean scores of its dimensions between manufacturing and
the sectors. (2) Employee job satisfaction differes between manufacturing and IT sectors,
and the level of job satisfaction is high among employees in the IT sector compared to
their counterparts in the manufacturing sector. (3) Dimensions of organizational culture
explain significantly the variance in job satisfaction of employees in both manufacturing
and IT sectors.
INTRODUCTION
Organizational culture has been perceived to have greater impact on a range of
organizationally and individually desired outcomes (Jill L. Mckinnon,et all, 2003). Fortune
conducted a survey on the most admired companies and it has indicated that the CEO
respondents believed that corporate culture was their most important lever in enhancing
key capability (Anonymous, 1998). Research scholars have considered from earlier period
onwards that organizational culture affects such outcomes as productivity, performance,
commitment, self confidence, and ethical behavior (Ritchie 2000). More recent writers
have reaffirmed that organizational culture does affect significantly an organization *
employees behaviour and motivation and its financial performance (Holmes and Marsden,
1996).
Yet, there is very little empirical research is done on the outcomes of organizational
culture(Detert et al.,2000 and Schein,1996). Following are the few research papers which
have studied organizational culture and outcomes: Sheridan (1992) found an association
between organizational cultural values and the rates at which new recruits voluntarily
terminated their employment, and OReilly et al.(1991) identified an association between
the fit of organizational culture with employee preferences for culture (the
person-organization fit) and organizational commitment, job satisfaction, and turnover.
These studies were conducted in the U.S. and, hence, within the particular national cultural
context of that country.
National culture has the potentiality to influence the relation between the organizational
culture and individual outcomes (Chow 2000, Agarwal et al.1999 and Lee and Mathur,
1998). Some researchers like Agarwal et al. (1999) point out the necessity of broadening
the study of organizational phenomena beyond the boundaries of Anglo- American
cultures.
This study (Koteswara Rao, 2002) attempts to broaden the boundary. The study examines
empirically the association between organizational cultural values and employee
satisfaction in a large manufacturing and information technology companies in India.
DEVELOPMENT OF HYPOTHESES
Organizational Culture
Organizational culture has been defined in many ways in the literature, for example
organizational culture is defined as a system of shared values (that define what is
important) and norms (appropriate attitudes and behaviors) by OReilly and Chatmans
(1996). In most definitions various combinations of assumptions, values, norms, beliefs
and ways of thinking and acting are used to explain the organizational culture (Jill L.
Mckinnon,et all, 2003)
Antal, Dierkes and Hahner (1997) have observed the connection between corporate culture
and the way firms perceive their environment in their research. To improve corporate
performance, transformation of organizational culture to fit into the prevailing business
environment is viewed as the utmost necessity (Peters and Waterman, 1982).
Culture of a nation is directly related with its economy and particular kinds of culture more
conducive for the economic success while others can be counter productive (Cartwright,
1999). For the effective functioning of an organization, its culture has to be in tune with
national culture (Redding, 1992). Unlike many other countries the Indian subcontinent has
the tremendous range of environmental regimes and supports a large range of human
population and consist of a fascinating mosaic of varied castes and cultural traits (Joshi et
all, 1993). Hierarchical relationship dominates in India (Sinha and Sinha, 1994). Indians
find it easier to work in superior-subordinate roles rather than with equals ( Kotheri, 1970).
A highly controlling superior is more successful in bringing out positive effect on
subordinate performance and satisfaction in the organizations operating in India(Kakar,
1971).
Job-satisfaction
In organizational behavioral research, job satisfaction is the most frequently studied
variable (Appelbaum, Bailey, Berg, and Kalleberg 2000; Spector 1997). Job satisfaction
emphasizes the specific task environment of the employee (Mowday, Porter, & Steers,
1982). It is also the individuals affective attitude or orientations for work ( Blum & Naylor,
1968, Muchinsky, 1990).
Many factors affect employees job-satisfaction. Porter and Lawler (1968) divide the
factors into the intrinsic satisfactory factors related to work itself and the extrinsic
satisfactory factors not directly related to work itself. Seasohore and Taber (1975) consider
that personal attributes and environment play major role in influencing job satisfaction.
Glisson and Durick(1988) indicate that the worker himself/herself, work and
organizational characteristics are the factors affecting job satisfaction.
Some organizational researchers argue that employing high-performance work systems
improves organizational productivity and increases job satisfaction (Appelbaum et al.
2000; Berg 1985). Other researchers focus more squarely on the promise of bilateral
control as a mechanism for workers to have meaningful input into decision-making
processes even as they directly relate to improving job satisfaction (Hodson 1999a).
Organizational Culture and Job Satisfaction
Jimfrase and his collegues propose that the culture of the workplace is the foundation from
