CALIFORNIA STATE UNIVERSITY, NORTHRIDGE

Organizational Culture and its Effects on Employee Performance

A graduate project submitted in partial fulfillment of the requirements For the degree of Master of Public Administration,

Public Sector Management and Leadership

By

Antonio Beltran

August 2020

ii

The graduate project of Antonio Beltran is approved:

________________________________________ ____________

Dr. Paul Krivonos Date

________________________________________ ____________

Dr. Elizabeth Trebow Date

________________________________________ ____________

Dr. Henrik Palasani-Minassians, Chair Date

California State University, Northridge

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Table of Contents

Signature page ii

Abstract iv

Chapter 1: Introduction 1

Chapter 2: Background 4

Chapter 3: Literature Review 6

Definitions of Organizational Culture 6

Organizational Culture and its Relationship to Employee Performance 6

Employee Performance in the Public Sector 8

Organizational Culture in the Public Sector 9

Public Service Motivation 11

Chapter 4: Research Design 13

Analysis 14

Chapter 5: Discussion 15

Conclusion 17

References 18

Appendix A 23

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Abstract

Organizational Culture and its Effects on Employee Performance

By

Antonio Beltran

Master of Public Administration, Public Sector Management and Leadership

This study will explore organizational culture and its effects on employee work

performance at the Los Angeles County Department of Public Social Services (DPSS) at District

36 in Pomona, California. This qualitative study will be based on grounded theory and will use an

open-ended questionnaire that will be distributed haphazardly to 380 eligibility work staff. A link

between organizational culture and employee performance will be sought and appropriate

remedies to improve performance will be recommended. The questionnaire provided to

respondents takes nine key elements into consideration: productivity, quality, work habits,

personal relations, adaptability, job knowledge, customer service, case maintenance, and specialty

services. Organizational culture will be measured by asking respondents to describe basic

organizational beliefs. Then the answers to the questions will be coded into themes to develop a

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model that will assist in transforming organizational culture so as to improve employee

performance. These nine elements were taken from an employee performance evaluation that is

given to employees annually. Employees will also be asked about their public service motivation

(PSM) prior to joining the DPSS to determine the effects the organizational culture has had on

their PSM.

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Chapter 1: Introduction

In 1979, Pettigrew wrote about organizational culture and changed how researchers would

study it from that point onwards (Pettigrew, 1979). Organizational culture is the frameworks of

beliefs, attitudes, norms, rituals and expectations of employees that are shared within an

organization (Jennings, 2012; Kim & Han, 2017; Sanger, 2008; Shiva & Suar, 2012).

Organizational culture is important to study because it will help to explain how to extract the most

value from the members of the organization. By examining organizational culture, organizational

managers can understand the area employees’ performance can improve in. Saad and Abbas (2018)

found that employee performance is positively affected by organizational culture. So, it is

imperative to look into the culture in order to find the areas where improvement can occur. In

public sector institutions employee performance is negatively affected by bureaucratic red tape

and is slow to change (Moynihan and Pandey, 2007).

A main function of the Los Angeles County Department of Public Social Services (DPSS)

is to provide benefits to qualified program participants. The intake process begins when a program

participant arrives at the DPSS. Then a case file is opened, and an eligibility worker (EW)

interviews the program participant. Finally, the supervisor either authorizes or denies the case for

benefits. The parts of the intake process where employee performance can be negatively affected

include the application submission process, interview process, case processing, and case

authorization process. It is the moments between these steps where the organizational culture of

the DPSS exhibits itself most strongly. The culture exhibits itself as lenient towards; tardiness,

EW’s socializing with each other about none work related subjects while program participants are

waiting, EW’s regularly committing case processing errors, and lastly supervisors employing

bureaucratic red tape. To the point that the culture exhibits leniency, Elicker et al. (2008) found

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that organizations that created strict climates for lateness affected employees behavior towards

being late and organizations that were lenient towards lateness had a higher frequency of late

employees. Thus, this is a part of the culture that should be addressed in order to improve employee

performance.

This study will use the employee evaluation the DPSS uses to evaluate its employees

annually on their job performance to help develop a questionnaire which will be used to extract

information about the organizational culture. The performance evaluation grades employees on

nine factors. These nine factors are productivity, quality, work habits, personal relations,

adaptability, job knowledge, customer service, case maintenance, and specialty services. Thus, the

aim of this research is to examine the organizational culture through the lens of these factors to

understand how the organizational culture is affecting employee performance.

The factors that affect employee performance in an organization can be created and

managed (Pettigrew, 1979), so that the energy of the employee can be harnessed in order to

transform a surviving organization into a thriving and forward-looking organization, not just to

keep pace in a world that is constantly changing but to excel and lead in it.

Along with studying organizational culture and its effect on employee performance, a sub

focus will be placed on Public Service Motivation (PSM) and its potential link between

organizational culture and employee performance because PSM plays a factor in an individual’s

willingness to work in the public sector. The motivational forces affecting the public servant have

been studied thoroughly and throughout many different societies (Lee et al., 2020; Lolowang et

al., 2019). PSM is defined as an individual’s orientation to delivering services to people with the

purpose to do good for others and society (Kim, 2012).

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A questionnaire will be devised and given to EW’s with questions that will be aimed at

eliciting responses that describe the organizational culture. For all of the above stated reasons and

to improve the organizational culture at the DPSS and knowing that most efforts at improving

organizational culture and employee performance are centered around factors that affect employee

performance, this study seeks to find the factors that are negatively affecting employee

performance within the organizational culture. And to deepen the connection to performance, the

questionnaire will seek to establish a link between the EW’s PSM prior to joining the DPSS and

to understand the effect organizational culture has on PSM.

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Chapter 2: Background

The impetus for research in this field centers around the idea of finding solutions to

problems encountered by organizations that seek to improve efficiency. As such, studying

organizational culture has been considered to be one of the most significant factors in bringing

about change in organizations and to make public administration more efficient (Ying and Bin

Ahmad, 2009; Jung et al., 2009). Early theorists on the subject of organizational culture viewed

this as a phenomenon that required direct observation with measurement techniques that required

extended periods of time. However, theorists still argued about the proper way to observe and

measure such a phenomenon (Schein, 1990).

Researchers have studied this phenomenon to find key determinants and predictors for

change. However, an aspect of organizational culture that researchers continue to disagree on is a

universally agreed upon conceptualization of organizational culture (Jung et al., 2009). Well over

100 organizational cultural dimensions have been associated and discussed among researchers

when studying this phenomenon (Jung et al., 2009). Some examples of organizational culture

dimensions that researchers have identified include adaptability, achievement, clan, bureaucratic,

adhocracy, and communal (Ying and Bin Ahmad, 2009). The debate between the appropriate

characterization remains unsolved. At the DPSS this study will seek to identify the key factors of

the organizational culture that negatively affect employee performance and that may contribute to

poor performance.

Employee performance has been characterized and defined as employees doing certain

skills in carrying out assigned tasks (Meswranti and Ilyas, 2018). Sinaga et al. (2018) believe that

performance is the achievement in carrying out tasks related to an organization’s strategy by an

employee, both in an individual role and/or by showing competency relevant to the organization.

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Ultimately, the success in completing required tasks is the critical factor in job performance

(Barasa et al., 2018).

The instruments used to measure organizational culture and employee performance have

also been a focus of discussion. To date, there is no ideal tool to measure the variables in question.

The more factors identified in a study leads to increased difficulty in finding a generic tool for a

single solution (Jung et al., 2009). The most important factor in finding an appropriate tool, is

exploring the aim and purpose and the results a researcher intends to find (Jung et al., 2009). This

study hopes to develop a tool for measuring organizational culture and employee performance at

the DPSS.

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Chapter 3: Literature Review

This section will discuss prior research that is pertinent to the research question: Definitions

of organizational culture, organizational culture and its relationship to employee performance,

employee performance in the public sector, organizational culture in the public sector, and PSM.

Definitions of Organizational Culture

The definition of organizational culture has seen various meanings and interpretations. For

example, Pettigrew (1979) defined organizational culture as symbols, language, ideology, beliefs,

rituals and myths. More recently, however, authors have defined organizational culture with

similar characteristics. For example, a common definition shared by many authors states that

organizational culture can be defined as a set of norms, beliefs, and routine patterns of action that

guide the behavior of organizational members (Jennings, 2012; Kim & Han, 2017; Sanger, 2008;

Shiva & Suar, 2012). A contrasting perspective from the aforementioned authors believes that

organizational culture can be defined as a system of common symbols and meanings that include

language, stories, rituals, myths, events, and the interpretation of those characteristics (Garnett et

al., 2008). For the purpose of this study we will define organizational culture as a set of norms,

beliefs, attitudes and routine patterns that guide employee principals within an organization.

Despite the various definitions, the ongoing impetus for authors is to find a connection between

organizational culture and performance.

Organizational Culture and its Relationship to Employee Performance

Sinaga et al. (2018) believes that organizations that contain core values of hard work,

reliability, respectfulness, and honestly ultimately improve employee performance. Managers and

employees who are exposed to these values always maintain and comply with regulations that set

a clear code of ethics for other employees to follow (Sinaga et al., 2018). The authors stated that

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employees can also prioritize common goals and interests rather than personal goals, this

atmosphere improves trust among employees that, which in turn, improves employee performance.

This is significant because at the DPSS where the culture is lenient towards tardiness reliability is

a factor that can be focused on to improve employee performance.

Calciolari et al. (2018) believes that organizational cultures that possess characteristics of

competitiveness leads to poor employee performance. Performance goals become a priority and

the pressure to meet these goals intensifies to the detriment of employees (Calciolari et al., 2018).

It is believed that numbers can motivate or enhance performance, but they can also produce

dysfunctional results (Jennings, 2012). On the other hand, Ellickson et al. (2001) argues that the

most significant factor impacting performance is departmental pride, followed by promotional

opportunities. Ellickson et al. (2001) placed special attention to promotional opportunities due to

the limited career advancement opportunities as a result of the nature of civil-service personnel

systems that rely largely on rules of seniority for promotions.

Interestingly, Rohim and Budhiasa (2019) conducted a study that sought to find the

relationship between employee renumeration and organizational culture structure in an attempt to

discover how renumeration affects employee performance. They came to a somewhat surprising

conclusion that employees and clan dominant culture were more likely to share information for

financial reward than were employees of an adhocracy dominant culture (Rohim and Budhiasa,

2019). This is significant because it shows the behavior of employees is not affected by a reward

system. However, employees in a market culture were proven to have greater levels of performance

when they took part in knowledge-sharing activities that included sharing technical expertise,

sharing knowledge after training, sharing policy documents and collaborating to solve problems

(Rohim and Budhiasa, 2019). Park et al. (2016) would agree and further suggest that employee

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involvement and teamwork increase employee performance. This is significant because one of the

nine performance factors measure for job knowledge and the culture at the DPSS doesn’t reward

knowledge sharing which can be detrimental to employee performance because teamwork is not

emphasized.

Furthermore, structure may also have an effect on how employees interact with one

another. For example, Van Scheppingen et al. (2013) suggests that a link exists between

organizational social capital and employee performance. While interaction between employees

and the connections they make are a naturally occurring thing, members can play a role by paying

attention to these interactions in order to foster trust and cooperation (Van Scheppingen et al.,

2013). Similarly, Jabeen and Isakovic (2018) suggest that organizations with “clan” like cultures

that have open lines of communication and involvement experience higher levels of trust, which

in turn increases performance.

Employee Performance in the Public Sector

Saad and Abbas (2018) conducted a study on organizational culture and job performance

on a University in Saudi Arabia. The researchers concluded that there is a positive relationship

between organizational culture and job performance. The researchers arrived at this conclusion by

analyzing four work culture criteria: mutual trust, teamwork, shared value system and respect

(Saad and Abbas, 2018). Saad and Abbas (2018) identified that their study had similar results to

that of western cultures, however, the impact of the elements that were identified had varying

degrees of impact. This conclusion is significant because we can conclude that the effects of

organizational culture on employee performance is a global phenomenon and not just a western

construct. This is further evidenced by a study conducted by Ying and Bin Ahmad (2009) in which

they characterize employee performance into two dimensions: task performance and interpersonal

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job performance. So at the DPSS employee performance can be studied from the perspective of

task performance and interpersonal job performance to see which of these factors can be improved.

Balthazard et al. (2006) found similar results when they discovered that regardless of

professionalism and professed or assumed goal sharing, organizational members may not behave

in ways that promote efficiency and effectiveness if doing so is inconsistent with their reference

prevailing culture. In other words, regardless of how professional you are, your cultural biases will

prevail over the organizational cultural preferences. Even at the cost of the organization as a whole

(Balthazard et al., 2006). This is important because the study should take into account the

prevailing cultural norms when considering employee behaviors towards tardiness.

It has been argued that employee performance suffers in organizations that utilize

bureaucratic organizational cultures (Aranchand and Ramanthan, 2013; Ashikali and Groeneveld,

2015). Ying and Bin Ahmad (2009) found similar results concerning bureaucratic organizational

cultures, however, they concluded that the combination of bureaucratic, innovative, and supportive

cultures together did not have a significant impact on performance. However, from those three

factors the supportive culture was reported as having the largest impact on employee performance

(Ying and Bin Ahmad, 2009). This is relevant because this study will seek to understand how

employees feel about the support they receive from the organization in order to measure the level

of support in the culture to determine the effects on employee performance.

Organizational Culture in the Public Sector

From an individual perspective, Ellinas et al. (2017) postulates that peer-pressure (social

interaction) has a greater influence on the overall network (organizational culture) while social

rank has a greater influence on the state of the individual. The implications of this study suggest

that organizations with a hierarchical structure with a majority of its individuals at lower levels

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and with a small group at much higher levels results in reduced performance (Ellinas et al., 2017).

This hierarchical description of an organization accurately reflects the organizational structure at

the DPSS, which seems to suggest that the DPSS may be operating an organizational structure that

is not optimized to increase employee performance.

Ristino and Michalak (2018) conducted a study of employee’s perceptions of their

organizations culture. Several noteworthy points are worth being mentioned. First, the study

concluded that responses to cultural dimension varied widely among respondents (Ristino and

Michalak, 2018). Second, organizational practices, organizational values, and fundamental beliefs

were the most influential in changing employee behavior (Ristino and Michalak, 2018). However,

lastly, the results are not generalizable to the entire population because the number of respondents

were too limited to come to a generalized conclusion. What sets this study apart from others is that

the author does not generalize the results he obtained to an entire population, whereas, other

researchers are quick to do so.

Jašarević et al. (2017) argue that an employee’s behavior is affected by organizational

culture, however, they believe that employees are able to measure their level of performance and

relationships with colleagues depending on the structure of their organizational culture. For

example, cultures that encourage teamwork or participation (Jašarević et al., 2017). This point is

in line with the findings of (Rohim and Buhiaas, 2019). Employees are specifically able to identify

their daily duties, tasks and goals of the day (Jašarević et al., 2017). This is significant because

employees understand and are aware that the work culture around them alters their performance.

Moon (2000) suggests that employee’s feel a sense of empowerment (i.e. sense of importance and

sense of achievement when organization have clear goals set for employees and promote a sense

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of job empowerment among employees. Jung (2014) and Caillier (2010) further believe that these

factors increase employee and organizational performance.

Public Service Motivation

Although this study is searching for organizational cultural factors that are causing the

observed moments of poor performance, there is also an idea that PSM may possibly be involved.

Moynihan and Pandey (2007) argue that red tape has a negative effect on PSM, yet still

organizations have to be attuned to providing clear goals to empower employees to give them a

sense of accomplishment within the organization. Organizational culture variables have found to

have a limited impact on predicting PSM, however, red tape was found to be negatively related to

PSM (Moynihan and Pandey, 2007).

Belrhiti et al. (2020) argues that a manager’s influence can increase PSM and extra role

behaviors. However, Pandey et al. (2012) found that if managers exploit employees PSM, then

they run the risk of alienating their employees to the detriment of the organization. While,

Paarlberg and Lavigna (2010) believes that recruiting and hiring employees with strong public

service values will only work if the recruits perceive that their tasks are important, and they work

in environments that enable them to act on their motivations. Thus, having strong organizational

values becomes an integral part in fostering an employees PSM and therefore maintaining strong

organizational culture (Paarlberg and Lavigna 2010).

Kim (2012) suggests that government organizations should communicate critical

organizational values with their employees and provide information about how organizational

context align with employee PSM. In doing so, employees are afforded the opportunity to decide

if the organization is a good fit with their personal values. This also allows organizations to hire

employees with high levels of PSM, which in turn may increase organizational performance and

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employee performance. However, Kjeldsen and Jacobsen (2013), partly contradicts the findings

of Pandey et al. (2012), in that PSM cannot predict employment preference in the public or private

sector. It is important to note that Kjeldsen and Jacobsen (2013) did not control for occupational

characteristics, they were not able to isolate whether there was an opportunity to do public work

(“I want to help others”) or the opportunity to do so in the public sector (“I want to work in the

public sector”).

Lee et al. (2020) suggest that trust stimulates individuals to have higher levels of PSM.

These results suggest that suggest that relationships with managers is crucial to employee PSM

(Pandey et al., 2012). Combined with the findings of Ward (2014), who believes that individuals

with prior public sector service will have experience levels of PSM. These findings suggest and

confirm that organizational cultures and individual experiences may have positive effects on

individual levels of PSM (Belrhiti et al., 2020).

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Chapter 4: Research Design

This will be a qualitative non-experimental study using haphazard sampling technique. In

order to gain a wide range of responses from employees, all EW staff at District 36 will be asked

to participate in a questionnaire that shall consist of 13 open ended questions relating to job

performance and organizational work culture. Responses will be gathered and analyzed using

grounded theory. The unit of analysis for this study will consist of approximately 380 EW staff at

District 36.

This qualitative methodology was chosen because it allows for a detailed description of

organizational cultural norms and by doing so it will help in describing the phenomena of factors

that improve employee performance. This study affords a unique opportunity because being a

member of the observed group for five years, facilitates the participant observation process as it

allows participants to feel comfortable without the feeling of being observed. Which in turn, will

allow for the observation of the naturally occurring behaviors of the employee’s in their usual

context. The approach of this study is to identify the factors in organizational culture that are

responsible for poor employee performance.

The questionnaire is modeled after a DPSS employee performance evaluation that

evaluates employees on nine performance criteria. Question one evaluates an employee’s

productivity and asks about assignment completion and deadlines. Question two will evaluate an

employee’s quality as it relates to work completion. Question three evaluates an employee’s work

habits as they relate to work attendance and tardiness. Question four will evaluate an employee’s

personal relationship with fellow employees and unit supervisors. Question five will measure an

employee’s knowledge as it relates to job function and procedures. Question six evaluates an

employee’s adaptability as it relates to work environment and new situations. Questions seven

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evaluates an employee’s customer service. Question eight will evaluate employee’s on case

maintenance as it relates to customer inquiries. Question nine will evaluate employees on a

combination of work knowledge and customer service. Question 10 will evaluate employee’s on

specialized services as it relates to going above and beyond an EW’s assigned job description.

Questions 11 and 12 will evaluate for organizational culture. Question 13 will ask employees about

their PSM. Question 14 is optional and will be used for demographic purposes. All questions with

the exception of question 14, aim to find a relationship between organizational work culture and

employee job performance. Any questionnaires not fully completed will be considered invalid and

will not be factored into final research results and at least a minimum of 20 questionnaires will be

required for the results to be considered valid.

Analysis

Upon questionnaire completion, responses will be gathered and reviewed for accuracy and

coded into themes. The coding framework for each response will be grouped by the structure of

the questionnaire. All questionnaire responses will be analyzed using standard qualitative

procedures based on grounded theory. Furthermore, analysis of questions will be focused on the

shared organizational cultural experiences within the location of District 36. This process of

collecting data will formulate the theory needed to explain how organizational culture affects

employee performance.

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Chapter 5: Discussion

This study intends to contribute and broaden the conversation between organizational

culture and employee job performance. Findings in this study will assist in developing a model

that organizational leaders may use in making sound decisions that will improve and increase

employee performance in public sector organizations. Having a wide range of criteria will make it

possible to evaluate respondents on an array of factors that will lead to valid conclusions. This

study identified nine criteria used by DPSS to evaluate employee’s on job performance. Having a

wide range of performance criteria may also lead to more than one valid and useful set of findings.

Validity concerns also arise within the study as it pertains to human bias. Respondents may not

provide enough detail to identify all significant factors affecting employee performance in

organizational culture because they may not think their answer is significant.

Given the importance of employee performance within most public sector organizations, a

model that is directly derived from research conducted within DPSS can make a significant impact

on both employee performance and the organizations. The model created from this study can be a

tool than can be easily understood and applied by organizations, given the useful nature of the

employee job performance evaluation it was modeled after.

Research is this field becomes equally more important when we consider the community

that is being served by DPSS. This community is largely disadvantaged and already on the brink

of homelessness, we as a society have to pay extra attention to helping them to get back on their

feet. Ideally, EW’s should show a high aptitude for this area of performance, they should have a

high level of competency. In order to carry out effective service to DPSS clientele, the

organizational culture and employee performance should be above average. An employee

performance model can be a valuable tool to increase employee efficiency that will ultimately

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create a more streamlined and effective approach in providing services to DPSS clientele.

Furthermore, from these results, the leadership at DPSS may wish to implement a revised policy

encouraging the supervisor of the EW’s to interact differently with the EW’s in order to improve

efficiency between the two sides. Because currently there are shortcomings between how

supervisors interact with the EW’s that cause decreases in performance. Findings from this study

will also be able to address tardiness and socializing while on the clock. It is hoped that this tool

may also be used more broadly across all DPSS offices within Los Angeles county.

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Conclusion

The results of this study intend to reveal the critical factors of organizational culture that

negatively impact employee job performance. The themes that will be explored will either answer

that hypothetical question or will provide more insight for follow-up questions on a second

questionnaire or other follow-up study. It is anticipated that the culture of the DPSS is negatively

affecting performance and that the relationship between the EW’s and their supervisor is

decreasing their PSM. This study seeks to identify the specific elements within the organizational

culture that are mainly contributing to the perceived lack effort by the EW’s. Ultimately, it is these

shared experiences within an organization that shape the attitudes of employees and have an effect

on their performance at work. Organizations need to be aware of the impact of these relationships

in order to address and improve performance among employees. The results of this study will be

made available to the head of the DPSS so that he/she may use them to enhance the performance

of EW’s. The cumulative result of this study will be better service to the participants of DPSS.

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Appendix A

Job Performance and Organizational Culture Survey Organizational culture: A framework of beliefs, attitudes, norms, routine patterns and the expectations of employees that are shared within an organization. Instructions: Please respond to these questions are they relate to your job performance and organizational culture. Please be as descriptive as possible.

1. What obstacles do you encounter when completing assignments and meeting deadlines? ______________________________________________________________________

2. When assignments are rejected to you for revision or correction, what caused the rejection?

______________________________________________________________________

3. Which work related factors have ever caused you to be late or absent to work? Please

describe. ______________________________________________________________________

4. Describe why you work closely or why you don’t work closely with fellow unit members

and supervisors? ______________________________________________________________________

5. Describe what you do to motivate fellow employees to approach you for assistance?

______________________________________________________________________

6. When you have had to adapt to change in your work environment, was it easy or difficult? Explain why. ______________________________________________________________________

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7. Think back to a time when you had to help a client and you were unprepared. How did your unpreparedness affect your help? Were they satisfied? ______________________________________________________________________

8. What factors would cause you to fail to acknowledge customer inquiries?

______________________________________________________________________

9. Think back to a time when you were complimented on your work or customer service.

Please describe why? ____________________________________________________________________

10. After you have completed your own assignments, what factors motivate you to help others in your unit?

______________________________________________________________________

11. Every organization holds basic beliefs that guides its employee’s behaviors. Which

elements do you most identify with within DPSS? ______________________________________________________________________

12. Which elements within organization do you agree with the least? please describe.

______________________________________________________________________

13. What drives you to work for DPSS?

______________________________________________________________________

14. Demographics: (optional)

a) Age: b) Gender:

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