CHAPTER ONE

1.0 INTRODUCTION.

This study comprises of five chapters; introduction which is followed by literature review

thereafter methodologies used in the study are proposed. This is followed by the presentation

of data and analysis. The last chapter provides summary of the findings, recommendations

and conclusion. Chapter one consists of the background of the study followed by the

statement of the problem after which the objectives and research questions of the study are

presented. Finally the significance, limitations and delimitations of the study are explored.

1.1 BACKGROUND OF THE STUDY.

The role of business in a society can be divided into economic and social role. The economic

role refers to the primary responsibility of a business organization which is economic in

nature and whose responsibilities are to provide /services, employment, earn profits to be

used in payment of services and to finance expansion and modernization.

A business must continue to emphasize its profit through its performance and at the same

time ensure that the corporate culture in the company is stable. Corporate culture is a deeply

embedded form of social control that influences employee’s decisions and behaviors.it is

social glue that binds people together and makes them feel part of the organizational

experience. This social glue is increasingly important as a way to attract new staff and retain

top performers.

Corporate culture assists in sense making process. In other words it helps employees

understand organizational events and employees can communicate effectively thereby

reaching higher levels of cooperation with each other because they share common mental

records of realities (Macshane and Glinow 2005).The powerful pervasive role culture plays

in shaping organizational life lends plausibity to speculations that cultural factors may be

linked with performance. A commonly hypothesized link suggests that if an organization’s

culture is to contribute to or enhance performance; it must be both strong and possess

distinctive traits, particular values beliefs and shared behavior patterns.

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Some scholars have claimed that positive cultural traits boost performance in proportion to

the strength of their manifestation this view has been called the strong culture

hypothesis .Oserian Development Company limited is an organization that is deeply

committed to instilling its corporate culture on its stakeholders, employees and suppliers.

However over the years the organization has been forced to keep up with the pace of rapid

globalization. At the time the company was founded the management comprised of

familymembers’ thus family values were greatly upheld and very important to the company

and even today family values are still important to the company. Today this has proved to be

a very difficult culture to uphold due to cultural diversity of different employees in the

company who are basedin different parts of Kenya. Due to the numerous challenges that

continue to exist, it is evident that researching the way that corporate culture has been

managed is particularly difficult. Moreover systems based organizations theory states that

“there is no one best way to achieve a given result and it is the goodness of fit between the

organization’s internal functioning, task, technology and environment which is critical”. For

these reasons corporate culture looked at in a single organization is difficult as one cannot

assemble a holistic picture of the totality of change over time(Source, Year).

A lot of changes have been observed within the company regarding organizational

operations, employee relations and employees and organizational performance due to the

corporate cultural change. According to Pearce/Robinson (2007) corporate culture is one of

those focusing areas across organizational units and it is important in establishing efficiency

especially in organizational performance. The organization’s history gives us a velar

perspective of how culture has been an important aspect of the company’s development for

the last forty seven years.

According to Brooks (2006) an intimate knowledge and awareness of culture should improve

our ability to analyze organizational behavior in order to manage and lead. From the

statement above, it can be said that research in corporate culture enables ability to analyze the

organizations behavior which translates to superior corporate performance. Corporate culture

has two relevant facts, it can shape an organizational processes but it can also act to create

and modify culture. Corporate culture’s contribution to performance is a consequence of this

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evolving interaction. Secondly it is likely that corporate culture’s link to performance is

considerably less straight forward than many rules imply.

1.2 PROFILE

As Sun Tzu, a military general from 3000 BC indicated in his explanation of strategy

“Culture forms an integral part of any organizational strategy. It consists of “Tao” the shared

beliefs, values and the glue that holds an organization together and it also involves the very

nature of the organization.” In today’s world many of the assumptions are unique and

different from those of a generation ago. The very workforce of nature has changed by

revolutionary proportions, today it seems that many corporate leaders actually think.

Oserian Development Company limited was founded by Hans Zwager a native of

Netherlands who migrated to Kenya in the early 1950s. Hans Zwager, who was born in the

Netherlands, he arrived in Kenya to start up the first Branch of the ANB Bank in Nairobi in

the early 1950s. Hans and his wife June started their own business of importing agricultural

spare parts, and chemicals for agricultural crops. Hans recognized that newly independent

Kenya had huge agricultural potential and he would need support services, so he set up

Kleenway Chemicals in Nairobi and Antipest Ltd in Mombasa in the 1960s. In 1968 he built

a factory that produced the first locally manufactured knapsack sprayers in Kenya. The Dutch

designed Hobra Sprayers were enthusiastically welcomed by small scale farmers as spare

parts and repairs were now always locally available. Later on he sold the company.

Hans purchased Oserian farm in 1969, which was a cattle ranch with 16 employees. Using

his enterprise and his appetite for risk Hans established a new concept - flowers for

export .Later his pioneering work led him to develop Geothermal Energy at Oserian, which

now provides electric power to the entire farm and uses geothermal heat to control diseases

in the rose houses, which has largely replaced chemicals fungicides.

Hans was one of the leading entrepreneurial pioneers in Kenya horticulture and Oserian soon

became the model for flower export to the Dutch and EU markets. Hans started up the TFA

(Tele Flower Auction) in the Netherlands, the first electronic flower auction in the world,

designed to promote and support Kenyan flower exporters. He also saw the opportunity to

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trade flowers directly to the UK supermarkets and established World Flowers in 1989,

allowing Kenyan farmers to trade directly with the European High Street superstores.

As Oserian expanded and thrived, he encouraged the development of a social complex,

which included housing 6,000 employees, their families. Today Oserian is one of the most

socially conscious businesses in the country with crèches, Primary and Secondary schools

and health care for thousands of children and adults. Hans has committed not only to

business but had long sought for a sustainable harmony between agriculture and the

environment. In 1995 he created a 20,000 acre sanctuary to protect the local wildlife and

ecosystem. Today, Oserian Farm and its greenhouses are surrounded by wildlife, which Hans

sees as a fitting tribute to the beauty of Kenya. Hans is retired and his son Peter Zwager is the

current chairman of the company. Today Oserian Development Company limited is the

leading exporter of fresh cut flowers in Africa and also one of the most technologically

advanced flower farm in the world. Major clients of the company include Netherlands,

United Kingdom, United States, Switzerland, Russia, Japan, Australia and Asia.

1.3 STATEMENT OF THE PROBLEM.

Oserian Development Company limited is an organization that started as a family business

in1969.However over the years the organization has grown to be one of the largest exporters

in the world. During the early years of the organization the board of directors consisted of

family members who made the major decisions in the company.

The company has rapidly expanded over the years thus members of the board of directors

include only a few family members and members from outside the family. Thus the family

culture that the family members held dear to has gradually gotten eroded over the years. This

study therefore seeks to find the effects of corporate culture on organization performance.

1.4 GENERAL OBJECTIVES.

The objective of the study is to determine how corporate culture affects the performance of

an organization.

1.5 SPECIFIC OBJECTIVES.

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The specific activities of the study are:

i. To identify how corporate culture affects motivation inOserian Development

Company limited

ii. To establish how corporate culture influences training and development in Oserian

Development Company limited.

iii. To establish how corporate culture affects leadership in Oserian Development

Company limited.

iv. To identify how corporate culture affects organizational structures in Oserian

Development Company limited.

1.6 RESEARCH QUESTIONS.

The main research question is; how does corporate culture affect theperformance of an

organization?

To answer the main question, answers to the following subsidiary questions will be sought;

i. How does corporate culture affect motivation in Oserian Development Company

limited?

ii. How does corporate culture affect training and development in Oserian Development

Company limited?

iii. In what ways does corporate culture affect leadership Development Company

limited?

iv. What are the effects of corporate culture on organizational structures in Oserian

Development Company Limited?

1.7 Significance of the Study.

The research intends to be beneficial to the following;

1.7.1 The Management

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The researcher anticipates that the findings of this study will enable the management

ofOserian Development Company Limited to understand the impact of corporateculture on

employee performance. The study will also seek to highlight corporate culture factors that

encourage maximum performance and those that lead to poor performance of employees.

The study also seeks to establish how the management can be able to integrate various

factors aimed at creating an organization that has positively motivated employees who

perform highly. Through this study the management will be able to identify the social and

physical needs of employees and a solution to their problems.

In conclusion the managers will also be able to recognize and appreciate the area of

weaknesses and strengths in relation to performance of employees.

1.7.2 The Employees

Corporate culture plays a big role in motivating, training and even boosting employees work

morale the organization. This study will help the employees to understand the role of

corporate culture in the organization and its effects on organizational performance.

1.7.3The Government

The Government will also benefit from this study as the performance of various

organizations will improve and this will boost the economic growth of the country.

1.7.4 Independent Researchers

This research will significantly help in further future studies as point of reference by other

independent researchers and even by non-governmental organizations in Kenya and beyond.

It will give insight on what has being done and recommended, gaps for further studies which

would need to be looked at.

1.8 Limitations of the Study.

The following are anticipated limitations that I might experience during the study;

1.8.1 Data Accessibility.

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The researcherexpects to encounter hostility from the organization and lack of co-

operation from respondents, thus being a hindrance from collecting data and also availability

of written records from the organization. This will solved by working closely with the human

resource department.

1.8.2 Transportation.

The researcher intends to carry out the study Oserian Development Company Limited which

is located on the outskirts of Naivasha Town. Transportation might be difficult as the

company is thirty five (35KMs) Kilometers from Naivasha town. This will be solved by

hiring a taxi.

1.8.3 Legal Issues.

Legal issues are also anticipated by the researcher where the company is not legally bound to

disclose its operations to any individual or researcher. Thus the information gathered will be

treated in utmost confidence.

1.8.4 Weather.

The research will be conducted during the rainy season and the researcher anticipates

problems in conducting the research during the rainy periods. This will be solved by buying

gumboots and other accessories.

1.8.5 Tools and Instruments to be used.

A problem on the availability of the tools and instruments to be used is anticipated. The

researcher anticipates late delivery of research tools from the supplier. However proper

follow up will be done so that the supplierdelivers the required materials early.

1.8.6 Ethical Issues.

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The question of ethical issues is expected to create problems during the research. Ethical

issues such as respondents asking for bribes before giving out information. Thus the

researcher intends to explain to the respondents that the purpose of the research is purely for

academic purposes.

1.8.7 Organizational Culture.

Culture is the way of individuals. The researcher anticipatesfinding organizational cultures

which are rigid and thus it will create difficulties in gathering information during the

research.

1.9 Scope of the Study

The main objective was to assess the effects of corporate culture on organizational

performance. The study focused on Oserian Development Company limited whose

headquarters are located in Naivasha and the company has two subsidiary offices in Nairobi.

The organization has a flower farm in Naivasha with flower acreage of 500 acres of flowers,

a wildlife sanctuary which is 20,000 acres, Kongoni lodge, Chui lodge and Lapive shop .The

study will focus on the employees who are in the floriculture industry as they form 80% of

the company workforce. Oserian Development Company limited is located along the Moi

south lake road off the Nairobi high way and it is approximately 35kilometers from Naivasha

town.

The studywill focus mainly on the effects of corporate culture on organizational

performance. The study will take a duration of three months that is from February 2016 to

April 2016. Necessary literature documents like company journals, protocols and other

relevant information will also be studied.

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CHAPTER TWO

2.0 LITERATURE REVIEW

2.1 Introduction

This chapter deals with literature review and it seeks to explain the effects of corporate

culture on organizational performance. The chapter is divided into three major sections; these

include an analysis of past studies, critical review and the summary of past literature. Finally

the chapter ends with the conceptual framework that shows the relationship between the

independent variable and the dependent variables.

2. 2 Corporate culture

Organization development is concerned with the analysis and diagnosis of the factors that

determine organizational effectiveness and the planning and delivery of programmes to

increase that effectiveness. Organizations want to obtain the commitment of their employees.

Management would like its employees to identify with the values, norms and artifacts’ of the

organization, hence the need for organizational culture. Management needs to explain and

imbed its culture on its employees; this will enable the employee to get familiar with the

organizational system. During this process of explanation, the employee learns about the

organizational culture and decides whether he can cope with it or not. This means that each

organization is a learning environment. It is the proper understanding of the organizational

culture that leads to the performance of the employee in the organization.

Performance is the extent to which an individual is carrying out assignment or task. It refers

to the degree of accomplishment of the task that makes up an employee’s job (Cascio, 2006).

Job performance is the net effect of an employee’s effort as modified by abilities and roles or

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task perceptions (Jones, 2003). The culture of the organization should be developed to

support continuous improvement, improve employees’ style of performing their job and thus

develop quality awareness. To operate successfully across cultures, it is important to be able

to recognize cultural differences and be adaptable (Deter, Schroeder, and Mauriel, 2000).

Organizational culture finds expression through the thoughts, intentions, actions and

interpretations of members of the organization (Hallett, 2003).

Academic interest in corporate culture is evidenced by the level of attention it has received

over the last few decades. The relationship between corporate culture and performance has

been the subject of abundant research in several fields, including strategic management,

organizational behavior, and industrial organizations. While this topic is rich in studies, many

researchers concur on the fact that there is no agreement on the precise nature of the

relationship between corporate culture and performance. Organizational culture has been

defined as the “normative glue” that holds an organization together (Tichy, 1982). Forehand

and von Gilmer (1964) suggest that culture is the set of characteristics that describe an

organization and distinguish it from others. Schein (1990) states that in a more

comprehensive fashion and defines culture as values and behaviors that are believed to lead

to success and are thus taught to new members.

All this is not to deny that leading actors, and to some extent also people in less salient

positions, may have a strong impact on cultural meanings in organizations, as illustrated by

the Enator case, where the preconditions for a rather far-reaching impact was quite good.

Managers, often more than other people, contribute in the shaping or reshaping of meanings

and ideas held by the people they interact with. However, context must be borne in mind in

understanding when and how managers affect the orientations of their subordinates. There

are no recipes for success that just can be copied and applied without consideration of time

and space, Impact on meaning formation is actually, what leadership is about, from a cultural

point of view.

The difficulties in establishing results and the linking of results to particular actors contribute

to the need for paying attention to how performance evaluation, credit and blame exist in a

cultural context. Of interest here are cultural themes such as time perspective, intellectual

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versus action orientations in relationship to tracking responsibility and cultural rules for

pointing versus tabooing milking strategies for improving performances, Obviously, there is

considerable national and industry-level variation. Japanese companies have a reputation for

being long-term oriented and thus having a richer coverage of individuals’ contributions than

for example US companies. Organizations with complex R & D work, where individual

contributions may be impossible to measure even in a medium-long perspective, have a

completely different evaluation situation than for example sales organizations.

2.2.1 Effects of Organizational Culture

There has been a great deal of anecdotal evidence and some empirical evidence regarding the

performance effects of organizational culture. Anecdotal evidence begins Peters and

Waterman’s In Search of Excellence. This book basically stimulated the now familiar

business school case study approach. More recent anecdotal evidence regarding the most

successful companies in the last several decades has also been proffered. According to

Cameron and Quinn (2009), many of the most successful companies, including Southwest

Airlines (21,775% return on investment Wal-Mart (19,807% ROI), Tyson Foods (18,118%

ROI), Circuit City (16,410% ROI), and Plenum Publishing (15,689% ROI), score low on

well-established critical success factors (i.e., entry barriers that prevents organizations from

competing for the same market, Non substitutable products, low levels of bargaining power

on the part of buyers due to customer dependence, low levels of bargaining power for

suppliers because they have no alternative customers, a large market share that promotes

economies of scale, and rivalry among the competition that deflects head-to-head

competition with a potential dominator).

These unlikely winners have strong leadership that promotes unique strategies and a strong

culture to help them realize these strategies. There is also strong anecdotal support indicating

that the primary cause of failure of most major change efforts (such as TQM and

reengineering) has been the failure to successfully change the organizational culture.

According to Heskett (1992), firms have attempted to make this intriguing, but admittedly

inconclusive, anecdotal evidence more systematic and empirical. They had financial analysts

identify the firms they considered most successful and then describe the key factors

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discriminating these firms from those that were less successful. Seventy-four of the seventy-

five analysts indicated that organizational culture was a key factor.

In addition, Denison (2000) found empirical support for the participation/involvement view

of culture – higher levels of employee participation were correlated with better organizational

performance. In contrast to this supporting anecdotal and empirical evidence, it has become

well known, and a point of great contention, that the exemplary companies identified by

Peter and Waterman (2002) did not remain exemplary. The general explanation for this is

that these companies failed to change with the times – perhaps the very strength of their

culture and their past success prevented them from quickly and successfully adapting to new

environmental requirements. This paradox suggested the need for more longitudinal

investigations of the effects of organizational culture. Growing evidence that excellent

companies do not remain excellent for long also suggests that the traditional notion of a

strong culture may need to be replaced with a more discerning understanding of the types and

role of culture and the need to change culture over the life cycle of the organization. For

example, perhaps a strong consistent culture is useful in the beginning start-up phase of an

organization but a mature organization may need to become more differentiated as well as

more oriented to change and learning. What is important for long term organizational success

may not be a particular type of organizational culture per se but the ability to effectively

manage and change the culture over time to adjust to changes in the situation and needs of

the organization. This understanding has pointed to the need for a more dynamic

understanding of culture and the role of organizational leaders in ensuring that the culture

contributes both to the organization’s current and future success.

Schein (2002) argues that leadership today is essentially the creation, the management, and at

times the destruction and reconstruction of culture. In fact, he says, “The only thing of

importance that leaders do is create and manage culture” and “the unique talent of leaders is

their ability to understand and work within culture”. Leaders must be able to assess how well

the culture is performing and when and how it needs to be changed. Assessing and improving

organizational culture as well as determining when major cultural transformations are

necessary is critical to long-term organizational success. Managing differentiated cultures

and creating synergies across these cultures is a critical leadership challenge.

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Effective culture management is also necessary to ensure that major strategic and

organizational changes will succeed. Culture management is a key leadership and

management competency. We are aware of successful leaders (Herb Kellerher of Southwest

Airlines, Lee Iacocca of Chrysler, Alfred P. Sloan of G.E., and General Robert E. Wood of

Sears, Roebuck & Co.) Who have succeeded in transforming the culture of the organization,

In addition, a study of U.S. presidents found that charismatic presidents had better

performance on a variety of dimensions, including economic and social performance

However; effective cultural management does not depend on great individual leaders and

charisma.

2.2.2 Leadership and performance

Leadership and performance can be broadly categorized into a number of important phases.

Early studies on leadership (frequently categorized as ‘trait’ studies on leadership)

concentrated on identifying the personality traits, which characterized successful leaders.

Trait theories assume that successful leaders are ‘born’ and that they have certain innate

qualities which distinguish them from non-leaders. However, the difficulty in categorizing

and validating these characteristics led to widespread criticism of this trait approach,

signaling the emergence of ‘style’ and ‘behavioral’ approaches to leadership. Style and

behavioral theorists shifted the emphasis away from the characteristics of the leader to the

behavior and style the leader adopted. The principal conclusion of these studies appears to be

that leaders who adopt democratic or participative styles are more successful. In this sense,

these early studies are focused on identifying the ‘one best way of leading’. Similarly, to trait

theories, the major weakness of style and behavioral theories is that they ignore the important

role, which situational factors play in determining the effectiveness of individual leaders.

This limitation gives rise to the ‘situational’ and ‘contingency’ theories of leadership. House,

1991; Vroom and Yetton, 2004) which shift the emphasis away from ‘the one best way to

lead’ to context-sensitive leadership. Although each study emphasizes the importance of

different factors, the general tenet of the situational and contingency perspectives is that

leadership effectiveness is dependent on the leader’s diagnosis and understanding of

situational factors, followed by the adoption of the appropriate style to deal with each

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circumstance. However, in an apparent return to the ‘one best way of leadership’, recent

studies on leadership have contrasted ‘transactional’ leadership with ‘transformational’

leadership.

According to Budd (2005) the brief summary above indicates that research into leadership

has gone through periods of skepticism; recent interest has focused on the importance of the

leadership role to the success of organizations. One of the most respected researchers on

leadership has provided a recent treatise on the importance of leadership by arguing that the

effectiveness of a leader is a major determinant of the success or failure of a group,

organization, or even an entire country. Indeed, it has been argued that one way in which

organizations have sought to cope with the increasing volatility and turbulence of the

external environment is by training and developing leaders and equipping them with the

skills to cope. These claims are based on the assumption of a direct link between leadership

and organizational performance. Widely celebrated cases of a direct leadership–performance

link may be found in numerous anecdotal accounts of improvements of company

performance attributed to changes in leadership However, empirical studies into the links

between leadership and performance have been lacking. Conceptually, it is argued that the

visionary and inspirational skills of transformational leaders motivate followers to deliver

superior performance. In summary, much of the above evidence presented as supporting the

claim of a leadership–performance link is anecdotal and frequently over-concentrates on the

‘transformational’ role of leaders in corporate successes. It would appear that few studies

have responded to the observation that much of the research reported as supporting this claim

is either inconclusive or empirically suspect.

According to Avolio (2003) the evidence of a leadership–performance link is largely

anecdotal, considerably more research has empirically examined the organizational culture–

performance relationship. Indeed, an examination of the literature is likely to conclude that

organizational culture is one of the most popular concepts of management and organizational

theory. One of the popularity of the culture concept is the increasing number of theoretical

perspectives and organizational disciplines which utilize the concept. The International

Journal of Human Resource Management It is argues that the academic acceptance of

culture, without the usual squabbles and skepticism associated with new concepts, is a major

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indication of the perceived importance of the concept. However, this is not to infer that there

is consensus on the meaning and relevance of the concept. On the contrary, there is

widespread disagreement on the scope of the organizational culture concept. Consequently, it

is pertinent to note three main issues. First, many researchers note that treating culture as a

unitary concept reduces its value as an analytic tool. Second, culture cannot be equated to

power and politics or climate. And, third, there is disagreement on whether organizational

culture can be easily changed.

Cloke (2002) states that the major reasons for the widespread popularity of an interest in

organizational culture stems from the argument (or assumption) that certain organizational

cultures lead to superior organizational performance. Many academics and practitioners

argue that the performance of an organization is dependent on the degree to which the values

of the culture are widely shared, that is, are ‘strong’ The claim that organizational culture is

linked to performance is founded on the Perceived role that culture can play in generating

competitive advantage the way in which organizational culture may create competitive

advantage is by building the boundaries of the organization in a manner which facilitates

individual interaction and/or by limiting the scope of information processing to appropriate

levels. Similarly, it is argued that widely shared and strongly held values enable management

to predict employee reactions to certain strategic options thereby minimizing the scope for

undesired consequences. Theorists also argue that sustainable competitive advantage arises

from the creation of organizational competencies which are both superior and imperfectly

imitable by competitors. To this end, it is argued that the ‘uniqueness quality’ of

organizational culture makes it a potentially powerful source of generating advantage over

competitors. Indeed, many commentators have advised organizations and researchers to

exploit the multiple advantages which could be offered by culture rather than focusing on the

more tangible side of the organization.

Early researchers who link culture to organizational performance are unequivocal in their

claims. An illustration of this is derived from the works of the so-called ‘excellence writers’

who argue that successful organizations are distinguished by their ability to promote cultural

values which are consistent with their chosen strategies. Although this view met with initial

popularity, the principal tenets of the argument have been subjected to extensive criticism.

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By the 1990s, researchers assessing the links between culture and performance were more

cautious. For example, Gordon and DiTomaso (2002) and Denison (2000) both propose that

there is a link between certain organizational culture characteristics and performance but

each add a number of provisos. In particular, they note that culture will remain linked with

superior performance only if the culture is able to adapt to changes in environmental

conditions. Furthermore, the culture must not only be strong (widely shared), but it must also

have unique qualities which cannot be imitated. However, more recently, it has been

suggested that the relationship between culture and Leadership style, organizational culture

and performance are tenuous. Indeed, the growing popularity of the resource-based view of

competitive advantage suggests that the degree to which a culture can be theorized to

determine a sustainable advantage is dependent upon the value, rarity, limitability, and

sustainability of the culture concerned. Much of the richness of culture is founded on the

claim by many researchers that culture is linked to organizational performance. While, some

theorists have questioned the universality of a culture–performance link, sufficient evidence

exists to suggest that organizational culture is associated with organizational performance.

According to Bass (2005), the earlier review of the literature on the relationship between

leadership andperformance and between culture and performance, many commentators

notethat the performance of an organization is dependent on the conscious alignment

ofemployee values with the espoused values of company strategy. This clearly indicatesthat

organizational culture and leadership are linked. The following is a review of theliterature on

this issue.One way of uncovering the relationship between culture and leadership is to

examine how culture has been conceptualized in organizational theory. Two approaches to

the study of the cultural phenomenon in organizations are: culture as an organizational

variable, then culture seen as something which can be manipulated. Thus the nature,

direction, and impact of such manipulation are dependent on the skills and abilities of the

leader. The majority of the literature which extols the virtues of transformational leadership

demonstrates widespread support for this view. In contrast, if culture is seen as an integral

part of the organization, then the thinking, feeling, and responses of leaders are molded by

the culture.

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Schein (2002) observes that organizational culture and leadership are intertwined. He

illustrates this inter-connection by looking at the relationship between leadership and culture

in the context of the organizational life cycle. Thus, during the process of organizational

formation, the founder of a company creates an organization which reflects their values and

beliefs. In this sense, the founder creates and shapes the cultural traits of their organization.

However, as the organization develops and time passes, the created culture of the

organization exerts on the leader and shapes the actions and style of the leader. Through this

dynamic ongoing process, the leader creates and is in turn shaped by the organizational

culture. In summarizing the consensus of opinion on the links between organizational culture

and leadership, Bass and Avolio (2003) mirror the argument of Schein (2002) by suggesting

that the relationship between the two concepts represents an ongoing interplay in which the

leader shapes the culture and is in turn shaped by the resulting culture. Bass (2005)

demonstrates the relationship between leadership and culture by examining the impact of

different styles of leadership on culture. He argues that transactional leaders tend to operate

within the limits of the existing culture, while transformational leaders frequently work

towards changing the organizational culture in line with their vision. Similarly, Brown (2002)

observes that good leaders need to develop the skills that enable them to alter aspects of their

culture in order to improve their organizational performance.

2.3 CRITICAL REVIEW

Despite the plenty of studies on corporate culture in the last few decades, there is no widely

accepted causal relationship between corporate culture and performance. The empirical

evidences emerging from various studies about the effect of corporate culture on

performance have so far yielded mixed results that are inconclusive and contradictory.

Because of these contradictory results, the question of whether corporate culture improves or

worsens employee’s performance is still worthy of further research such as the one being

undertaken in this study. In addition, despite the existence of these studies, very little

attention has been given to the banking industry. This means that the impact of corporate

culture on employee’s performance in the banking industry has not received adequate

research attention.

2.4 SUMMARY

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The concept of organizational culture is derived from the anthropological concept of culture

that attempts to explain why people in societies believe and behave as they do. Culture is at

the same time both positive and negative in character. It is simultaneously a major factor in

an organization's success, and a significant limiting factor in the face of change. Culture is a

complex of values, beliefs and behaviors that become part of the social fabric of

organizations. The factors which define culture are internal, deriving from the unique

character of the organization, and external, determined by the background and experiences

managers and employees bring to the enterprise. Culture is a major determinant of

productivity; it shapes organizational responses to external pressures and suppresses or

enhances the co-operative effort level of the workforce. Culture has a significant bottom-line

effect on organizational effectiveness, profitability and shareholder value. Once established,

an organization's culture is highly resistant to change. Most employees have had the

experience of dealing with colleagues, managers and direct reports who resist the idea of

change with a dismissive "but we've always done it this way." This statement represents the

bedrock system of beliefs and accompanying behaviors that makes up an organization's

culture.

An intimate knowledge of culture and awareness should improve our ability to analyze

organizational behavior in order to manage and lead. From this statement it can be said that

research into organizational culture enables the ability to analyze organizational behavior

which translates into superior corporate performance. However this does not show clearly the

relationship between corporate culture and organizational performance.

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2.5 Conceptual framework

Motivation

Training

Leadership

Organizational structures

Dependent Variables Independent Variable

Source: Author (2016)

Motivation

Motivation is the driving force by which humans achieve their goals. Motivation is said to be

intrinsic or extrinsic. The term is generally used for humans but it can also be used to

describe the causes for animal behavior as well. This study refers to human motivation.

According to various theories, motivation may be rooted in a basic need to minimize physical

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Performance

pain and maximize pleasure, or it may include specific needs such as eating and resting, or a

desired object, goal, state of being, ideal, or it may be attributed to less-apparent reasons such

as altruism, selfishness, morality, or avoiding mortality. Conceptually, motivation should not

be confused with either volition or optimism. Motivation is related to, but distinct from,

emotion.

Training

Training is a process in order to change a human being's attitude, knowledge, skills and

behavior. The term training refers to the acquisition of knowledge, skills, and competencies

as a result of the teaching of vocational or practical skills and knowledge that relate to

specific useful competencies. It forms the core of apprenticeships and provides the backbone

of content at institutes of technology (also known as technical colleges or polytechnics). In

addition to the basic training required for a trade, occupation or profession, observers of the

labor-market

Leadership

Leadership is described as the “process of social influence in which one person can enlist the

aid and support of others in the accomplishment of a common task" Definitions inclusive of

nature of leadership have also emerged. Alan Keith of Genentech states that, "Leadership is

ultimately about creating a way for people to contribute to making something extraordinary

happen." According to Ken "SKC" Ogbonnia, "effective leadership is the ability to

successfully integrate and maximize available resources within the internal and external

environment for the attainment of organizational or societal goals."

Organizational structures

An organizational structure consists of activities such as task allocation, coordination and

supervision, which are directed towards the achievement of organizational aims. It can also

be considered as the viewing glass or perspective through which individuals see their

organization and its environment. An organization can be structured in many different ways,

depending on their objectives. The structure of an organization will determine the modes in

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which it operates and performs. Organizational structure allows the expressed allocation of

responsibilities for different functions and processes to different entities such as the branch,

department, workgroup and individual. Organizational structure affects organizational action

in two big ways. First, it provides the foundation on which standard operating procedures and

routines rest. Second, it determines which individuals get to participate in which decision-

making processes, and thus to what extent their views shape the organization’s actions.

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CHAPTER THREE

3.0 RESEARCH DESIGN AND METHODOLOGY

3.1 Introduction

This chapter will provide a description of the research that will be used to answer the

research questions. This is described as an operational framework whereby facts are placed

so that their meanings are more clear (Peil, 2003). Thus the research will be dictated by the

nature of information collected to answer questions and itwill adopta descriptive design. This

chapter is structured as follows: Introduction, study design and methodology, target

population, sample design, sampling and sampling procedures and data analysis.

3.2 Research design

Research design is a detailed proposal relating to a defined piece of archaeology endeavor

which includes a definition of a problem, subject or hypothesis for investigation, the

background and context to investigation, the proposed means and methods of the proposed

investigations, management arrangements and quality control procedures, a table of costs

(Robinson, 2002)

The case study will used because it allows for a critical data collection and analysis within

the given target population, over a short period of time. The research will use descriptive

research design for it is essential for the researcher to provide an elaborate description of the

phenomenon under study. This will also be important to the researcher as it will enable

him/her to get enough information that will be needed in order to undertake analysis of the

study.

3.3 Target population

A population is the total collection of elements about which we wish to make some

references. The target population includes high level management with thirty employees,

middle level management with forty employees and low level management with fifty

employees. This data will be gathered from the management after presenting the letter of

authority from my institution. The main emphasis will be to gather much more accurate

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information from employees at all levels in order to acquire accurate and actual findings on

the effects of corporate culture on organization performance. The size of target population is

shown in the Table 3.1

Table 3.1 Target population components

Population category Target population Percentage (%)

High level management 50 17

Middle level management 70 23

Low level management 180 60

Total 300 100

Source: Author (2016)

From the Table 3.1, the low level management constitutes of a majority of 60% followed by

the middle level management represented by 23% and finally the high level management

represented by 17%.This shows that majority of the employees are from the low level

management

3.4 Sampling design

A small section of the target population will be selected for observation and analysis.

Analysis is the process by which a relatively small number of individuals, objectives or

events are selected and analyzed in order to find out something about the entire population

from which it was selected. A sample can therefore be defined as a small portion of a target

population using some systematic form.

This research study will use stratified random sampling size as itwill enable the

generalization of a larger sample size of percentage of the total population. Several

employees will be randomly chosen and administered with questionnaires to fill. The

population will be divided into 3 strata that istop management, middle management and low

level management.

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Sample sizes of 90 respondents will be drawn from the sample frame using simple random

sampling to promote the need for efficiency representativeness. This will be justified

according to Kothari (2004) who states that “A representative sample can be between 20-

30% of target population”. The sample sizes are shown in Table 3.2

Table 3.2 Sample size

Population category Target population Sample size Percentage %

High level

management

50 15 17

Middle level

management

70 21 23

Low level

management

180 54 60

Total 300 90 100

Source: Author (2016)

From Table 3.2 the sample size will be 30% of the target population. This refers to the

number of respondents that will be targeted by the researcher.

3.5 Data collection methods

The suitable techniques for data collection from the specific sample units will be primary and

secondary data. The research study will use direct observation approach and develop

questionnaires to collect data from the respondents. Questionnaires will be used because they

will ensure uniformity of questions. (See appendix I). Therefore the researcher anticipates

that questions will yield more data than other information. The questionnaires included both

open and closed ended questions.

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3.6 Data collection procedures

The researcher will prepare questionnaires with brief instructions which will allow the

respondents to select the opinions they agreed with or disagree with. The questionnaires will

be dispatched to all respondents through hand delivery on a set date.

The secondary data will be obtained from available literature whose sources included

libraries, internet, textbooks, journals and newspapers. These instruments will be used

because they provided for in-depth data collection and reliable. To avoid bias, the

questionnaires will be administered on each stratum- this willenable the researcher to gather

accurate information and it will also save on time.

3.7 Data analysis

According to Cooper and Schendler (2003), quantitative analysis consists of categorizing,

tabulating and recombining evidence to address the research questions.

The quantitative analysis for this study will use descriptive statistics such as bar charts and

pie charts to display nominal or ordinal data, frequency counts, percentages, graphs to

describe distributions and pie charts test to detect any weaknesses in design and

instrumentation through questionnaires.

The questionnaires will be checked to ensure that they are properly filled and also to check

for the validity and accuracy of the data collected .There will be the use of open and closed

questionnaires.Content validity will be determined using expert judgment whereby the

questionnaires will be given to the research supervisors who will establish that the

instruments’ measures what it purports to measure. In analysis of the data qualitative

technique of data collection will be used.

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Appendix 1

Questionnaire

Information to respondents

Pleas fill in the questionnaire below. The information is strictly for educational purpose and

it will be treated with a lot of confidentiality.

Section A: personal information

1. Please indicate your status

Male

Female

2. Age

18-25

26-33

34-41

42 and over

3. Educational level

Primary Diploma

Secondary Degree

Masters

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4. Section B: General information

i.Briefly describe what you understand by corporate culture

…………………………………………………………………………………………

…………………………………………………………………………………………

……………….

ii.Does the organization promote corporate culture?

Yes

No

iii.What do you think are the effects of corporate culture on organization

performance?....................................................................................................................

..........................................................................................................................................

..........................................................................................................................................

.......................................

5. Section C: Specific research questions on motivation

i.Does corporate culture affect staff motivation in the organization?

Yes

No

ii.If yes in question (ii) briefly explain its

effects………………………………………………

…………………………………………………………………………………………

…………………………………………………………………………………………

…………………….

iii.What improvement would recommend in matters of staff motivation?

…………………………………………………………………………………………

…………………………………………………………………………………………

…………………….

6. Section D: Specific research questions on training

i. How frequently do you attend training in your organization

1-4 times in a year

5-8 times in a year

9-12 times in a year

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13 times and above in an year

ii. Does corporate culture affect performance of organization training?

Yes

No

iii. If yes, in what ways does it affect organization performance (explain)

…………………………………………………………………………………

…………………………………………………………………………………

…………………………………………………………………………………

………………..

iv. In relation to question (ii) above, if it doesn’t affect training, how effectively

has the organization spreadits corporate culture?

…………………………………………………………………………………

………………………………………………………

v. What areas would you recommend corporate culture to enhance service

delivery? .............................................................................................................

..............................................................................................................................

..............................................................................................................................

........................................................

7. Section E: Specific research questions on leadership

i. Does corporate culture add value to leadership in the organization

Yes

No

ii. If yes in the above question (i) briefly explain

…………………………………………………………………………………

……………………………………………………..

iii. In your opinion, describe the challenges of corporate culture

…………………………………………………………………………………

…………………………………………………………………………………

………………..

iv. From your opinion, how can an organization tackle these challenges

…………………………………………………………………………………

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…………………………………………………………………………………

……………

8. Section F: Specific research questions on organization structure

i. Are the organizational structures in line with the corporate culture?

Yes

No

ii.If yes in the above question, briefly explain

………………………………………………………………………………………

…………………………………………………………….

iii.Do the organizational structures function in a reliable way

Yes

No

END

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