1.1 Introduction

Organisational culture has been an important theme in management and business research for

the past few decades due to its effect and potential impact on organisationally and individually

desired outcomes such as commitment, loyalty, intent to turnover and satisfaction (Chow et al.,

2001). In today's business environment, organisational culture is used as a powerful tool that

portrays many facets of a workplace as well as to quantify the way a business functions (Gray,

Densten & Sarros, 2003). Research has confirmed that organisational culture is not only able to

change, guide and display but also give significant contributions by influencing the thought,

feeling, interacting and performance in the organisation (Ab. Aziz Yusof & Juhary Ali, 2000).

The importance of culture is enhanced through its impact on employee morale and work

attitudes such as job satisfaction (Dose, 1997).

Similarly, employee morale is a workforce phenomenon that confronts every organisation at

some time. The understanding of morale is important because it can have tangible and wide-

ranging effects and outcomes for an organisation. Morale is not a simple concept and the

outcomes associated with high or low morale may impact upon staff turnover, attainment of

organisational or personal goals, the ability to adopt new practices, learning new skills and the

delivery of good customer service. As early as the 1940s morale was being viewed as an

important workplace issue. At the time, it was suggested that when any person holds a position

of responsibility in a business, the word "morale" comes to have real meaning and refers to

something that has great importance, even if that something remains vague and illusive. At

times the feelings of poor morale are difficult to articulate by those that are affected by it.

While there are a number of thematic variations on the definition of morale, for the purposes of

this review, positive morale is seen as an attitude of confidence in the mind of the individual

where they identify with a group, accept group goals and work towards achieving them

collectively. The fact that there has been no unifying definition of morale goes some way to

explaining the reasons why definitive empirical studies on the phenomenon have been

somewhat sporadic.

1

Despite the considerable body of organisational literature that has been conducted to examine

the relationship between corporate culture and employees' satisfaction in various countries as

well as industries (for example, Chow et al., 2001; Mohammad Saeed & Arif Hassan, 2000;

Pool, 2000; Rashid et al., 2003; Grifford, Zammuto & Goodman, 2002; Lund, 2003; Sheridan,

1992), there is very little literature that recognises organisational culture studies within the

context of the Banking industry, particularly on how employee morale amongst employees is

affected by organisational culture dimensions that have otherwise attracted considerable

attention in organizational literature. As the banking industry is the spotlight of the global

service industries and is considered to be one of the major contributors to the global economy,

organisational culture is strategically and tactically important for gaining a competitive

advantage. Moreover, the banking industry differs from other industries in terms of their

organizational structures, responses to the environment, managerial styles and the ways in

which they compete with other firms. The importance of culture is enhanced through its impact

on employee morale and work attitudes such as job satisfaction (Dose, 1997). In order to

bridge the gap and provide organisations with practical assistance in dealing with this issue,

this research is aimed towards examining whether the application of eight dimensions of

organisational culture adoption results in an improvement of employees' working conditions

that contribute towards the higher employee morale specifically in the context of the Indian

Banking Industry.

In view of the absence of such research on these relationships, therefore, this paper reports the

results of a survey that was designed to answer a general research question: "Does

organisational culture predict employee morale in banking sector?"

This research is particularly important, as most of the studies carried out in the Indian

environment attempt a partial understanding in the sphere of organizational culture and

employee morale. Most of these stress only a single characteristic of these two aspects.

Indian organizational culture with both its formal and informal characteristics has been the

object of hardly any studies. Most of our knowledge about it is derived from day to day

experience and heresay rather than a comparative, systematic and scientific analysis. It’s effect

2

on morale too how escaped scientific analysis and is subject to rough estimates and highly

personal perceptions in most cases.

To address the knowledge gap, this study contributes to the literature by attempting to satisfy

the clear need for an analytical study that examines recognizable dimensions of organisational

culture, and linking organizational culture and employees' morale, using appropriate statistical

methods (i.e. data analyses were used based on both descriptive and inferential methods)

within five major banks, both the private and the public sector banks in the tricity region.

Based on an extensive study of previous research on organisational culture, eight core

dimensions of organisational culture have been identified as key dimensions, which support an

organisation's business strategy towards the increase in employees' work outcomes. These

dimensions of organisational culture are: Openness, Confrontation, Trust, Authenticity,

Proaction, Autonomy, Collaboration and Experimenting. Similarly, the dimensions of

Employee morale are the Index Of Job Satisfaction, the Index Of Organisational Image, the

Index Of Career Growth, the Index Of Satisfaction With Superiors, the Index Of Satisfaction

Of Emotional And Physical Needs. Finally, this research project uses quantitative methods to

study the impact of organisational culture on employee morale in the banking sector within the

tricity region.

The purpose of this investigation is two-fold. Firstly, to provide a greater understanding of the

influence of organizational culture on employee morale. Secondly, to present a comparative

study of the organizational culture and employee morale in the two types of banks – private

and public sector banks.

1.2 Introduction to the Banking Sector

Banks are the most significant players in the Indian financial market. They are the biggest

purveyors of credit, and they also attract most of the savings from the population. Dominated

by public sector, the banking industry has so far acted as an efficient partner in the growth and

the development of the country. Driven by the socialist ideologies and the welfare state

3

concept, public sector banks have long been the supporters of agriculture and other priority

sectors. They act as crucial channels of the government in its efforts to ensure equitable

economic development.

The Indian banking can be broadly categorized into nationalized (government owned), private

banks and specialized banking institutions. The Reserve Bank of India acts a centralized body

monitoring any discrepancies and shortcoming in the system. Since the nationalization of

banks in 1969, the public sector banks or the nationalized banks have acquired a place of

prominence and has since then seen tremendous progress. The need to become highly customer

focused has forced the slow-moving public sector banks to adopt a fast track approach. The

unleashing of products and services through the net has galvanized players at all levels of the

banking and financial institutions market grid to look anew at their existing portfolio offering.

Conservative banking practices allowed Indian banks to be insulated partially from the Asian

currency crisis. Indian banks are now quoting al higher valuation when compared to banks in

other Asian countries (viz. Hong Kong, Singapore, Philippines etc.) that have major problems

linked to huge Non Performing Assets (NPAs) and payment defaults. Co-operative banks are

nimble footed in approach and armed with efficient branch networks focus primarily on the

‘high revenue’ niche retail segments.

The Indian banking has finally worked up to the competitive dynamics of the ‘new’ Indian

market and is addressing the relevant issues to take on the multifarious challenges of

globalization. Banks that employ IT solutions are perceived to be ‘futuristic’ and proactive

players capable of meeting the multifarious requirements of the large customer’s base. Private

Banks have been fast on the uptake and are reorienting their strategies using the internet as a

medium The Internet has emerged as the new and challenging frontier of marketing with the

conventional physical world tenets being just as applicable like in any other marketing

medium.

The Indian banking has come from a long way from being a sleepy business institution to a

highly proactive and dynamic entity. This transformation has been largely brought about by

4

the large dose of liberalization and economic reforms that allowed banks to explore new

business opportunities rather than generating revenues from conventional streams (i.e.

borrowing and lending). The banking in India is highly fragmented with 30 banking units

contributing to almost 50% of deposits and 60% of advances. Indian nationalized banks (banks

owned by the government) continue to be the major lenders in the economy due to their sheer

size and penetrative networks which assures them high deposit mobilization. The Indian

banking can be broadly categorized into nationalized, private banks and specialized banking

institutions.

The Reserve Bank of India acts as a centralized body monitoring any discrepancies and

shortcoming in the system. It is the foremost monitoring body in the Indian financial sector.

The nationalized banks (i.e. government-owned banks) continue to dominate the Indian

banking arena. Industry estimates indicate that out of 274 commercial banks operating in

India, 223 banks are in the public sector and 51 are in the private sector. The private sector

bank grid also includes 24 foreign banks that have started their operations here.

The liberalize policy of Government of India permitted entry to private sector in the banking,

the industry has witnessed the entry of nine new generation private banks. The major

differentiating parameter that distinguishes these banks from all the other banks in the

Indian banking is the level of service that is offered to the customer. Their focus has always

centered on the customer – understanding his needs, preempting him and consequently

delighting him with various configurations of benefits and a wide portfolio of products and

services. These banks have generally been established by promoters of repute or by ‘high

value’ domestic financial institutions.

The popularity of these banks can be gauged by the fact that in a short span of time, these

banks have gained considerable customer confidence and consequently have shown impressive

growth rates. Today, the private banks corner almost four per cent share of the total share of

deposits. Most of the banks in this category are concentrated in the high-growth urban areas in

metros (that account for approximately 70% of the total banking business). With efficiency

5

being the major focus, these banks have leveraged on their strengths and competencies viz.

Management, operational efficiency and flexibility, superior product positioning and higher

employee productivity skills. 

The private banks with their focused business and service portfolio have a reputation of being

niche players in the industry. A strategy that has allowed these banks to concentrate on few

reliable high net worth companies and individuals rather than cater to the mass market. These

well-chalked out integrates strategy plans have allowed most of these banks to deliver

superlative levels of personalized services. With the Reserve Bank of India allowing these

banks to operate 70% of their businesses in urban areas, this statutory requirement has

translated into lower deposit mobilization costs and higher margins relative to public sector

banks.

The key players in the banking sector in India are State Bank of India (SBI) and Punjab

National Bank (PNB) in the Public Sector Banks while Industrial Credit and Investment

Corporation of India (ICICI) and Housing Development and Finance Corporation (HDFC) in

the private sector.

1.3 Chapter Scheme

This research consists of five chapters. The first chapter gives the introduction and background

of this study along with an industry overview. The second chapter is a review of the literature

on organisational culture and employees' morale. The third chapter leads to the development of

the conceptual framework and hypothesis development that is tested in this study and also

provides a description of the methodology that is used in the research. The fourth chapter

provides the discussion of the results obtained after analysing the data, and is followed by the

limitations and suggestions for future research, conclusion and implications in the last section.

6

2.1 ORGANISATIONAL CULTURE

2.1.1 IntroductionThe information age has arrived in full force and technology along with all of its advancements

is here to stay. Even though businesses seem to be all about numbers and making a fast buck,

companies are again realizing the immeasurable significance of their human workforce. The

recent awareness of organizational culture theory is evidence that ‘the time has come to write

meaning and emotion back into organizations’ (Gabriel 1991, p. 319).

This chapter presents a literature review on different aspects of organisation culture and

employee morale. It also explores selected tools used by other researchers to assess

organisational culture and employee morale. A brief review of some works studying the

relationship between organisational culture and employee morale is also presented in this

chapter.

2.1.2 Organisational cultureThis sections looks at different aspects of organisational culture including its concepts,

definitions, its importance and components. A brief review of some tools used by other

researchers to assess organisational culture is also included.

A. Concepts and definitions of organisational culture

The concept of ‘organisational culture’ has become popular since the early 1980s. Along with

the growing interest in the topic, there seems to be little agreement within the literature as to

what ‘organisational culture’ actually is and, therefore, there are different definitions and

perspectives on this topic. Some define organisational culture as the observable behavioural

rules in human interaction (Van Maanen 1979); some as the dominant values in an organisation

(Deal & Kennedy 1982); others as a consistent perception within an organisation (Robbins

1998). One of the most common definitions of organisational culture includes shared values,

beliefs, or norms (Beyer & Trice 1987; Tunstall 1983; Wilkins & Patterson 1985; Martin 1985;

7

Barney 1986; Kerr 1991) (Chen, CS 1994). As a summary, Yanagi (1994, p. ii) stated that

organisational culture can be defined as ‘philosophies and values shared by the members of

organisations and their behavioural patterns for translating them into practical actions’.

Another often referred-to definition of organisational culture was devised by Schein (1989,

1992). According to Schein (1989), culture is a coherent system of assumptions and basic

values, which distinguish one group or organisation from another and orient its choices.

Hence, organisational culture implies ‘a pattern of basic assumptions – invented, discovered, or

developed by a given group as it learns to cope with its problems of external adaptation and

internal integration – that has worked well enough to be considered valid and, therefore, to be

taught to new members as the correct way to perceive, think, and feel in relation to those

problems’ (Schein 1989, p. 9).

‘Culture is the unique whole, the heart and soul that determines how a group of people will

behave. Cultures are collective beliefs that in turn shape behaviour’ (Organisations @ Onepine

2003). A key role for organisational culture is to differentiate the organisation from others and

provide a sense of identity for its members.

An important point made by some researchers while exploring the concepts and definitions of

organisational culture is the stress that culture is a dynamic, evolving process, not at all static.

Morgan (1986), for example, argued that culture must be understood as an active, living

phenomenon through which people create and recreate their worlds. Schein (1989) also stated

that organisational culture changes over time and becomes more embedded into the ‘out-of-

awareness’ functioning of an organisation. Both Morgan and Schein’s views imply that key

individuals have a crucial role to play in shaping and refining the culture. Schein (1989, p. 2)

claimed that ‘organisational culture are created by leaders and one of the most decisive

functions of leadership may well be the creation, the management, and – if and when that may

become necessary – the destruction of culture’. Although the main focus of this research is

culture at the organisational level, it is also important that due attention be given to the broader

external societal, cultural context within which organisations are embedded. Cultures are

“layered” as stated by researchers. Cultures permeate many levels of social life simultaneously.

8

Some aspects of culture are nearly universal, like the high value placed on family bonds and

good childcare. Other cultural themes are characteristic of whole regions of the world (regional

culture). A culture becomes characteristic of a specific nation (national culture), or even of a

particular social group (organisational/corporate culture), largely because of its linkage to

specific locales and experiences. Organisational culture, therefore, has to be viewed in a

broader perspective, with due consideration given to the interrelation or the linkages between

cultural themes at the regional, national, organisational and individual levels.

Despite the various definitions and perspectives on organisational culture, one thing is

universal amongst most of them, and that is the shared nature of the beliefs, philosophies,

norms …etc. In essence, many claimed that the function of organizational culture is to create a

feeling of ‘esprit de corps’ within the organisation (Van Maanen & Barley 1985, p. 39). If this

is so, then we should attempt to examine why organizational culture is regarded so important

and valuable.

B. Increasing importance of organisational culture and research on organizational culture

Organisational culture is the key to organisational excellence and the function of leadership is

the creation and management of culture (Schein 1992). ‘In general we find that outstandingly

successful organisations usually have strong and unique cultures… Unsuccessful organisations

have weak indifferent sub-cultures or old sub-cultures that become sclerosed and can actually

prevent the organisation’s adaptation to changed circumstances’ (Hofstede 1980, p. 394).

Organisational researchers are becoming more aware of the importance of understanding and

enhancing the cultural life of an organisation. ‘One study of a group of high-performance

companies in North America indicated that paying attention to organisational culture is an

important ingredient in organisational success’ (Frost et al. 1985, p. 16). Organisational

learning, development and planned change cannot be understood without considering

organisational culture as the primary source of resistance to change (Schein 1992).

The ability to perceive and assess the limitations of one’s own culture and to develop the

culture adaptively is the essence and ultimate challenge of leadership (Schein 1992).

Interpreting and understanding organisational culture is an important activity for managers,

9

researchers and consultants because it affects strategic development, productivity and learning

at all levels. Organisational culture has been shown to ‘affect workers’ commitment to and

identification with the group and organisation, as well as their sense of involvement with their

work assignments’ (Louis 1985, p. 85). With respect to the issue of change and culture, there is

solid documentation that overlooking organisational culture has impeded efforts to change

organisational functioning. Examination of past failures in organisational development efforts

points to the role of culture as a critical force to be considered in effecting change (Beer 1980).

Some of the reasons why it is important to understand an organisation’s culture are:

It will determine the responses that an organisation will make to new problems and

challenges. It may facilitate change or be a stumbling block.

It will determine the kinds of people who are attracted to the organisation and who will be

successful in it.

It determines what counts as important in the organisation and so gives a clear direction for

planning training and management development programs. Failing to understand and manage

the organisational culture can lead to much time being wasted on irrelevant activities and even

to conflict between different levels in the organisation, cynicism and disillusionment. Without

control of the culture, subsidiaries, departments and functions may take on their own culture.

While some differences in culture between groups within the same organisation may be

acceptable or desirable, there may be core values, which are vital to the success of the

organisation and should be shared by all. These core values need to be identified and

embedded in the culture. The process involves being explicit about what values are important

to the organization and getting people to understand and commit themselves to these values

(Human Factors International 2004).

Schein (1989, p. 48) stated ‘failing to understand how culture works is just as dangerous in the

organisational world as failing to understand gravity and the atmosphere in the

physical/biological world’.

10

C. Different aspects of organisational culture

While exploring the ‘content’ of organisational culture, researchers seems to use a wide variety

of approaches, methods and terms to describe what organisational culture might contain and/or

entail. The organization ‘has’ perspectives sees organizational culture as consisting of

variables, subsystems or components. These components have been described in McKinsey’s

7-S framework. (Peters and Waterman, 1982; see Figure 2.1)

Figure 1- McKinsey’s 7-S framework

In this framework, components have certain functionality and management can control and

integrate different components to form strong or weak cultures. As Meek (1988) stated:

“’strong cultures are somehow more likely to be associated with effectiveness than are weak

cultures and strong cultures can be deliberately created” (p.196) and “Organisational cultures

are created by leaders and one of the most decisive functions of leadership may well be the

creation, the management, and - if and when that may become necessary – the destruction of

culture”

Similarly, Schein (1989) referred to various ‘cultural elements’ such as the physical layout of

an organisation’s offices, rules of interactions that are taught to newcomers, basic values that

11

come to be seen as the organisation’s ideology or philosophy, and the underlying conceptual

categories and assumptions that enable people to communicate and to interpret everyday

occurrences. He distinguished among these elements by treating basic assumptions as the

essence – what culture really is – and by treating values and behaviours as observed

manifestations of the cultural essence. In a sense, he classified these elements into three levels

of culture (see Figure 2.1)

Figure 2 Levels of culture and their interaction

Earlier, Lundberg (1985, p. 171-172) had offered a very similar view and distinguished four (4)

separate levels of meaning for an organisation’s culture (adapted from Schein (1981) and Dyer

(1982) (See Figure 2.3)

12

Figure 3 Organisational culture – levels of meaning

Source: Adapted from Lundberg, CC 1985, 'On the feasibility of cultural intervention in organisations',

Organisational Culture, Sage Publications, Beverley Hills, CA, pp. 171-172.

At the more visible or superficial levels of culture in Schein’s and Dyer’s formulation are

artefacts. These are tangible aspects shared by members of an organisational group, including

variable verbal, behavioural and physical attributes. Also included are such things as the

language, stories and myths, rituals, symbols and ceremonies, technology and art used by an

organisation. The next level involves perspectives: the rules and norms the members of a group

or organisation develop and share socially in any given context. Perspectives may be viewed as

the solutions to a common set of problems encountered by organizational members from time

to time. They define and interpret situations of organisational life and prescribe the bounds of

acceptable behaviour in such situations. They are relatively concrete and members are usually

aware of them The values are the evaluation base that members of an organisation use for

judging the ‘rightness’ or ‘wrongness’ of situations, acts, objects and people. Values reflect the

real objectives, standards and goals in an organisation and define as well its transgressions,

sins, and wrongdoings. At the deepest level of an organisational culture are the basic

assumptions, which are the tacit beliefs that members hold about themselves and the world,

their relationships to one another and the nature of the organisation in which they work.

Largely unconscious, they underpin the first three levels above. They can be viewed as the

implicit and abstract axioms that determine the values, perspectives and artefacts of an

organisation’s culture.

Another well-known author, whose ideas influence organisational work, Geert Hofstede, has

argued that organisational cultures should be distinguished from national cultures. Cultures

13

manifest themselves, from superficial to deep, in symbols, heroes, rituals and values etc.

National cultures differ mostly on the values level; while organisational cultures at the levels of

symbols, heroes and rituals, together labeled ‘practices’. Hofstede (1980) studied the

differences in national cultures for over fifty countries. The cultures show five independent

dimensions of values: power distance; individualism versus collectivism; masculinity versus

femininity; uncertainty avoidance; and Confucian dynamism.

Power distance: a measure of the inequality between ‘bosses’ and inferiors, the extent to

which this is accepted.

Uncertainty avoidance: the degree to which one is comfortable with or feels threatened by

ambiguous, uncertain situations, the extent one can or cannot tolerate uncertainty and tries to

avoid it by establishing more structure.

Individualism – Collectivism: the degree to which a culture relies on and has allegiance to

the self or the group. In other words, it is the degree to which one thinks in terms of ‘I’ versus

‘we’; either ties between individuals are loose or people are part of a cohesive group

throughout their lives.

Masculinity – Femininity (also known as achievement versus nurturance orientation): the

degree to which a culture values such behaviour as assertiveness, achievement, acquisition of

wealth or caring for others, social support and quality of life.

Confucian dynamism: this fifth dimension was later added following Hofstede’s work with

Michael Bond (Hofstede & Bond 1988) which was meant to explain the rapid economic

development of many Asian countries. This dimension refers to the selective promotion of

particular set of ethics found in Confucian teachings. Particular teachings that lead to economic

development include thrift, perseverance, a sense of shame, and following a hierarchy. The

impact of long-term or short-term orientation is also studied as part of this dimension.

In his research into organisation cultures, Hofstede identified six independent dimensions of

practices:

process-oriented versus results-oriented;

job-oriented versus employee-oriented;

professional versus parochial;

open systems versus closed systems;

14

tightly versus loosely controlled; and

pragmatic versus normative

The position of an organisation on these dimensions is determined in part by the business or

industry the organisation is in. Hofstede (1991, 1997) emphasises that culture is not a property

of the individuals, but of groups.

Some other researchers, while studying organisational culture, noted that an organisation’s

structure is a determinant of its culture, i.e. certain structures create certain type of cultures, as

reflected in Charles Handy’ s work. He outlines a simple framework for categorising cultures.

Handy also uses four (4) Greek Gods to illustrate his basic approaches and the organisational

cultures that result (Handy 1991):

Role Culture: is perhaps the most readily recognised and common of all the cultural types.

It is based around the job or role rather than the personalities and is epitomised by what we

tend to think of as the traditional hierarchical structure. Its strengths are in its predictability,

stability and consistency while its obvious opposites of inflexibility and slowness of reaction

and adjustment are its weakness.

Task Culture: is one where management is basically concerned with the continuous and

successful solution to problems. Performance is judged in terms of results and problems

solved. Although a structure exists, it is flexible and capable of being formed and reformed

depending upon the task in hand (more flexible and adaptable). Individuals empowered with

discretion and control over their work. Power and respect come from individual knowledge and

talent rather than rank or position.

Power Culture: In this type of organisation, power derives from the top person, and a

personal relationship with that individual matters more than any formal title or position. The

dominant influence of the centre results in a structure that is able to move quickly and respond

to change and outside threats. This culture is often found in small entrepreneurial organisations

and political groups but will frequently breakdown as they grow since the web is more difficult

to maintain with size.

Person (Star) Culture: The individual is the central point. If there is a structure, it exists

only to serve the individuals within it. The culture only exists for the people concerned; it has

no super-ordinate objective. The culture is that of educated and articulate individuals,

15

specialists who have come together because of common interest – solicitors, academic

researchers, consultants etc…

D. Some tools / instruments used to assess organisational culture

Given the importance of organisational culture, many researchers, consultants and managers

have attempted to search for a valid and applicable measurement tool/instrument to help

understand, diagnose, measure and manage an organisation’s culture. Various tools have been

developed with a variety of qualitative and quantitative approaches to measuring organisational

culture, making the choice of methods a matter of goal and purpose of the particular

investigation. In some cases, qualitative measures may have an advantage in the assessment of

certain aspects of an organisational culture e.g. attitudes, satisfaction. The diversity of

measurement tools and approaches reflects the diversity in perspectives on the content, levels,

dimensions, typology and the formation and development of organisational culture which

ultimately dictate what needs to be uncovered and/or measured and who need to be involved in

the process.

The Denison organisational culture survey (Denison 1990) is one of the instrument for which

evidence of sensitivity to organisational change has been presented. This tool assesses

organisational culture along the four basic cultural traits, which are presented by certain

organisational dimensions. The tool consists of 60 items, which are used to assess and measure

the dimensions. Table below gives a brief description of the structure of the instrument.

16

Source: Adapted from Denison, DR 1990, Corporate culture and organizational effectiveness, Wiley, New

York.

Denison’s Organisational culture survey offers a quantitative multi-dimensional assessment of

the main organisational cultural traits. The assessment has also been correlated with

organisational performance measures.

Organisational culture profile (OCP) (O’Reilly, Chatman & Caldwell 1991) has been used

extensively in various researches as an instrument for assessing cultural characteristics of

organisations. The OCP contains 54 value statements that can generically capture

organisational values and characteristics. The general procedure was to ask respondents

familiar with the organisation to sort the 54 items into nine categories ranging from least to

most characteristic of the organisation. Scores are allocated accordingly. The OCP was further

17

tested and developed which led to the identification of seven organisational culture dimensions

underlying the OCP: Innovation, Stability, Respect for people, Outcome orientation, Detail

orientation, Team orientation and Aggressiveness.

The Human Factors International’s (2004) Organisational Culture Questionnaire (OCQ) was

designed as a practical instrument of measurement and management of organisational culture

change. It is a tool used for identifying the culture which is at present operating in the

organisation. The OCQ does not categorise the organizational culture into a particular type but

describes it in terms of its predominant characteristics, behaviours and attitudes. The OCQ

comprises 130 questions relating to 13 different dimensions of organisational culture:

Leadership, Conflict management, Productivity, Innovation, Participation, Communication,

Decision making, Organisational goal integration, Organisation structure, HR management,

Customer focus, Professionalism and Fun.

Organisational Culture Inventory (OCI) is another tool for measuring organizational culture. It

was researched and developed by Cooke and Lafferty (1987). Basically, the OCI provides a

profile of an organisation’s operating culture in terms of the behaviours that members believe

are required to ‘fit in and meet expectations’ within their organisation. It measures ‘how things

are done around here’. The OCI examines how members of an organisation experience its

operating culture. Through members’ answers, the OCI measures twelve (12) distinct patterns

or styles of behavioural norms and expectations that members of an organisation might be

expected to adopt in carrying out their work and interacting with others. The 12 patterns are

classified into 3 groups of “styles” with Achievement, Self-actualising, Humanistic

encouraging and Affiliative belonging to the ‘Constructive Styles’; Approval, Conventional,

Dependent and Avoidance belonging to the ‘Passive/defensive Styles’; Oppositional, Power,

Competitive and Perfectionistic belonging to the ‘Aggressive/defensive Styles’.

The 12 patterns are also categorised in terms of members’ needs: Perfectionistic, Achievement,

Self-actualising, Humanistic-encouraging, Affiliative and Approval represent ‘Satisfaction

Needs’; Conventional, Dependent, Avoidance, Oppositional, Power and Competitive represent

‘Security Needs’. The 12 patterns are also used to measure an organisation’s culture in terms of

18

its orientation with some patterns are distinctively related to the ‘People orientation’ such as

Self-actualising, Humanistic, Encouraging, Affiliative and Dependent while some other

patterns are related to the ‘Task orientation’ such as Competitive, Perfectionistic, and

Achievement. Combined OCI scores are then transferred to a circular graph to form a visual

profile, or picture, of an organisation’s current culture.

Given the existence of a wide variety of organisational culture measurement tools and

methods, careful selection of a relevant method should be made based on the goals, focus and

the purpose of each particular study. The best practice would seem to involve a combination of

qualitative and quantitative approaches customised for the research questions under

investigation. A broad range of methods may be appropriate, ranging from participant

observation and in-depth and semi-structured interviews to some of the of the more recently

validated culture assessment tools. The good news is: the research results to date ‘suggest that

useful measures of organisational culture are feasible, even if no one measurement strategy can

yet be considered the “gold standard”’ (Boan & Funderburk 2003, p. 12).

2.2 EMPLOYEE MORALE

2.2.1 Introduction

How do managers maintain or improve worker morale? Despite unanimous agreement in the

existing literature about the importance of morale in influencing worker performance and

hence firms’ profits, neither a well-defined theory nor a well-defined set of factors that

contribute to a high level of employee morale has emerged (Howitt, 2002). Numerous studies

identify select worker and workplace characteristics that appear to influence morale, but to

date, the literature continues to measure morale in a variety of ways, making comparisons

across studies and thus the formulation of an appropriate and effective managerial strategy to

improve worker morale somewhat problematic.

19

2.2.2 Concepts and definitions of morale

A survey of the very extensive literature on morale yields definitions which are as varied as

they are numerous. There seem to be, however, at least three distinct approaches.

The first approach developed out of the classical "needs psychology" and includes those

theories which stress the personal determinants of morale. In this approach, "needs" are seen as

giving rise to "drives" which aim at the satisfaction of these "needs." A dichotomy between

basic and acquired needs is generally made. Basic needs are those having a physiological

substratum such as hunger, thirst, and sex; whereas derived or acquired needs are largely

social, such as the need to achieve status and self-esteem and the need to affiliate with other

people. Studies concerning the personal determinants of morale include those of McGregor,

Burling, Allport, and Fraser.

The second approach to the definition of morale deals with a hierarchy of needs. The most

systematic development of this concept is given by Maslow. Very briefly, the theory holds that

when basic needs are satisfied "higher" needs emerge which dominate the organism until these

in turn are fully or partially satisfied. The physiological needs (hunger, thirst, sex, etc.) are

regarded as the most basic and prepotent. When these are satisfied, "higher" needs arise which

are more social in nature and which concern the realization of the self. In a small but

suggestive study by Haire and Gottsdanker there is a discussion of the hierarchical character in

the factors of morale. This is illustrated by the fact that "pay" appears to be a basic need and

when "pay" is satisfactory "higher" self-actualization needs become dominant, whereas such

needs are eclipsed when the individual's security is threatened and financial incentives are

dominant.

A third approach, stemming from the perspectives of Elton Mayo, led to an emphasis upon the

significance of interactions among members of a working group. It is held that, in work as in

other activities, one of man's strongest characteristics is to be continuously associated with his

fellows. The investigations at the Hawthorne plant of the Western Electric Company during the

years 1927-19329 led to the conclusion that overriding the effect of changes in physical

20

working conditions (such as levels of illumination, wage incentives, hours of work, length and

position of rest pauses) upon output were the feelings and sentiments attached to being an

integrated part of a special work group. The investigations made a very significant contribution

in calling attention to the existence and importance of the "social" motives in industry and in

showing the need to investigate the pattern of group activity. Among the most systematic

approaches to a theory of motivation applied to both individual and group patterns of behavior

is the "field theory" as formulated by Lewin. Viteles has summarized the findings of individual

studies applying field theory which have helped establish the importance of the view earlier

formulated by the Hawthorne investigators. Levels of motivation and morale are not

necessarily the end effects of specific incentives, i.e., of specific elements in the work situation

or specific items of personnel practice. Levels of motivation and morale are a result of the total

work situation and of its many overlapping dynamic interrelations which involve both the

individual and the smaller groups in a larger social field.

So, Morale is a word with multiple meanings. MAYO defined it as ‘the maintenance of

cooperative living.’ In this sense it refers to a sense of belonging to a group.

Dr. Leighton described morale as the capacity of a group of people to pull together persistently

and consistently in pursuit of a common purpose.’ Thus, acceptance of a goal and commitment

on the part of the group to work for it are important components of high morale, according to

this view.

Yet another view expressed by Prof. Kossen links morale with employee attitudes. It refers to

‘employees’ attitude towards either their employing organizations in general or towards

specific job factors, such as supervision, fellow employees and financial incentives.

Researchers, to add to the confusion, generally came out with two formulations while using the

term morale: a) job satisfaction as the concern of an individual and b) morale as a group

phenomenon.

21

According to McFarland, morale is a concept that describes the level of favourable or

unfavourable attitudes of employees collectively to all aspects of their work-the job, the

company, their tasks, working conditions, fellow workers, supervisors and so on.

The Merriam-Webster Collegiate Dictionary defines morale as “the mental and emotional

condition (as of courage, discipline, enthusiasm, confidence, or loyalty) of an individual or

group with regard to the function or tasks at hand.”

In their article examining the importance of employee-management relationship closeness,

McKnight, Ahmad, and Schroeder (2001) define morale, in the context of the workplace, as

“the degree to which an employee feels good about his or her work and work environment.”

The authors say morale serves as a broad term that encompasses smaller concepts including

intrinsic motivation, job satisfaction, experienced work meaningfulness, organizational

commitment, and pride in one’s work.

2.2.3 Factors related to morale

Early work in employee morale was generally directed toward the fostering of group rapport

and the internalization of management goals by employees. Later research indicated that

employee morale was something more than group solidarity and the internalizing of

management goals. Since the Western Electric studies, several lines of research have

developed in this field.

Melany E. Baehr and Richard Renck used an employee attitude questionnaire, the Employee

Inventory, and the technique known as multiple-factor analysis for identifying the factors of

morale. The results of two separate and independent factor analyses of employee attitudes on

two widely different groups of employees yielded essentially the same five factors. These five

factors, based on factor analyses of category scores (group averages for sets of related items),

were thought to represent certain basic attitudes in the general industrial population which

affect the morale of industrial employees. The factors are defined as follows:

22

Factor A (Organization and Management). This factor deals with the employee's relationship

with management and the organization which management represents to him. In a sense, it is

the image of management and the company in the employee's mind. Thus it reflects sentiments

of identification with the organization and of security for the present and future. It is also an

evaluation of the communication in the organization and of management's efficiency,

effectiveness, and concern for employee welfare.

Factor B (Immediate Supervision). The attitude toward immediate supervision represented by

this factor includes both the human relations aspect and the purely administrative aspects of the

supervisor's job.

Factor C (Material Rewards). This factor deals with the material rewards the employee gets

from his work both in terms of pay and in terms of employee benefits.

Factor D (Fellow Employees). This factor deals with the friendliness of fellow employees and

their ability to work together without friction. It reflects interpersonal relations among

employees on the job.

Factor E (Job Satisfaction). This factor represents the intrinsic satisfactions associated with

actually doing the job and with the belief that the job is worthwhile and affords opportunities

for personal growth and development.

These factors describe the personal satisfactions which the employee derives from gainful

occupation (Material Rewards and Job Satisfaction) and the employee's relationship to other

groups in the work environment. One of these groups deals with management and the structure

of the formal organization (Organization and Management), and the others deal with the

employee's relationship with the primary work group (Fellow Employees) and with his

relationship to that group of employees (Immediate Supervision) whose influence permeates

the work environment. These factors represent some of the basic dimensions in the structure of

morale in industrial society today. They represent a basic pattern of satisfactions which the

employee hopes to derive as a member of various interrelated and overlapping groups with-in

the organization. These five factors in employee morale have been defined in terms of 30

selected Inventory items, which are understandable to the industrial employee and to which he

can respond. They can be used as a core of items for attitude survey questionnaires developed

especially for particular types of employees (e.g., professional or retail employees) or for

particular types of industries (e.g., manufacturing or merchandising). In short, the five factors

23

identified by this research appear to be relatively stable, define basic dimensions of employee

morale, and lend themselves to a variety of research purposes and pragmatic uses in many

different types of organizations.

Also, Motivation and morale were closely related. However, motivation was not morale. But

the response to motivation of an individual reasonably would make satisfaction promoted the

morale in each individual. (Santiwong, 1987, p.359)

The content theories of motivation focused on the factors within the person that energized,

directed, sustained, and stopped behavior. They attempted to determine the specific needs that

motivated people. The important content approach to motivations was Herzberg’s two-factor

theory. (Ivanvich & Matteson, 2002, p.151)

Herzberg developed a content theory known as the two-factor of motivation. The two factors

are called the dissatisfies or the hygiene- motivators or the extrinsic – intrinsic factors,

depending on the discussant of the theory. The original research which led to the theory gave

rise to two specific conclusions.

First, the set of intrinsic conditions, the job content, when present in the job, builds strong

levels of motivation that can result in good performance. These conditions are not present, job

do not prove highly satisfying. The factor in the set are called the satisfiers or motivators and

included: achievement, recognition, work itself, responsibility and advancement.

Second, the set of extrinsic conditions, the job context, which results in dissatisfaction among

employees when the conditions are the dissatisfiers or hygiene factors, since they are needed to

maintain at least a level of “no dissatisfaction”. They included: salary, status, interpersonal

relationship, job security, policies and administration, supervision and working conditions.

One appealing aspect of Herzberg’s explanation of motivation is that the terminology is

morale. There is no need to translate psychological terminology into everyday language.

Despite this important feature, Herzberg’s work has been criticized for a number of reasons.

Some researchers believe the Herzberg’s work oversimplifies the nature of job satisfaction.

24

2.2.4. Measuring Employee Morale

Employee morale is a fundamental component of business operations – high morale coincides

with job satisfaction, high work effort, creativity and initiative, a sense of pride in one’s work,

a commitment to one’s organization, and the desire to put the achievement of group (common)

goals ahead of personal goals, thereby enhancing an organization’s performance. Low morale,

typically corresponding to high absenteeism, labor turnover, unresolved grievances or strikes,

impedes the achievement of the organization’s desired outcomes.

Widely recognized in the psychology, management, and human relations literatures as a

primary factor governing worker effort and thus in determining overall company performance

(Howitt, 2002), employee morale has nonetheless been difficult to quantify. Because morale is

a feeling, rather than an action or outcome, it cannot be measured directly. Moreover, even

among studies conducted in developed market economies, the jury is still out regarding

whether morale is best evaluated as a group phenomenon (Milton et al., 1984; Smith, 1966

1976) or an individual experience (Doherty, 1988; Evans, 1992; Hart, 1994; Watson, 1988) and

some confusion exists regarding how best to differentiate the causes from the manifestations of

a particular level of morale (Abbott, 2003; Howitt 2002; Norquist et al., 2002; Straka, 1993).

Efforts to separate morale from its determinants or outcomes have generated a range of

measures. Some measures of morale attempt to capture its positive affect -- morale is identified

with persistence and energy, cohesion and cooperation, and enthusiastic striving (Hart, 1994;

Hart & Conn, 1992; Hart et al., 2000; Smith, 1966). Other measures of morale focus on efforts

to assess an individual’s mental health (Doherty, 1988; Watson, 1988) or how individuals feel

at a particular point in time. These measures tend to include such elements as anxiety and

depression, as well as other elements that would likely be found in measures of neuroticism

(Costa & McCrae, 1985; Hart et al., 2000).

Two primary approaches have emerged to develop a proxy for employee morale. The first

approach involves measures of job satisfaction and organizational commitment as a proxy for

employee morale (Hull & Azumi, 1988; Koeske & Kirk, 1995; McKnight et al., 2001;

25

Pestonjee & Singh, 1977; Reed, 2002). The second approach uses measures of consequences

such as quit rates, grievances and strikes (Norsworthy & Zabala, 1982, 1986, 1990; Straka,

1993).

2.3 IMPACT OF ORGANIZATIONAL CULTURE ON EMPLOYEE

MORALE

Two studies have been found in this regard. First done by Nandita Kasal (1992) regarding the

relationship between organizational culture and employee’s morale. The organizational culture

was measured using the 11 dimensions - interpersonal trust, degree of autonomy, freedom of

decision–making, communication patterns, importance given to merit, receptiveness to new

ideas, importance to excellence, inter-departmental relations, concern for people, use of status

symbol and leadership style and employee morale using the following five dimensions - index

of organizational image, index of career growth, satisfaction, index of satisfaction with

physical and emotional needs. The study was conducted in electronic units of Himachal

Pradesh. The technology factor was also included. The finding was that organizational culture

had a significant impact on employee morale.

The second study was done by Harinder Bir Kaur in selected commercial and co-operative

banks. The banks were compared on the same above 11 dimensions of organizational culture

and five dimensions of employee’s morale and also on some demographic variables - age,

education, experience and level (manager, officer, supervisor).

In the analysis of the 11 dimensions of organizational culture the 7 dimensions show

significant differences in the two types of banks. These are interpersonal trust, communication

patterns, importance given to merit, receptiveness to new ideas, importance to excellence, use

of status symbol and leadership style. Dimension-wise, commercial bank employees have a

higher level of interpersonal trust, as compared to their counter-parts in cooperative banks.

26

Good autonomy has been given to the employees, yet decision-making power is limited in both

types of banks. Most of the decision-making power is vested in few hands at the top level.

Excellence is overlooked. Greater importance is given to individuals in commercial banks.

They are encouraged to give new ideas and their input in this respect is welcomed. Emphasis is

given to the individual’s training and development. Communication patterns are well

developed. Use of status symbol is quite less. All these factors taken together give rise to an

open organizational culture which is more prevalent in commercial banks as compared to

cooperative banks.

The analysis of employee morale indicates that there is significant difference in all the five

indices of morale in both categories of banks. Commercial banks scored significantly higher

than co-operative banks. The author emphasis that though the organizational image is high, job

satisfaction and satisfaction with supervisors is average. Thus their morale tends to be low

which can be attributed to fewer career prospects and chances of advancement. This is evident

in cooperative banks where there is widespread frustration due to fewer opportunities for

advancement.

A positive and high degree of correlation exists between organizational culture and employee

morale. Nine dimensions of organizational culture except the freedom in decision making and

use of status symbol show significant relationships with morale.

27

3.1 INTRODUCTION

The conceptual schema of this study focuses on the development of a theoretical organisational

culture model as a systematic way in measuring the employees' morale. Examining the

relationship between the organisational culture and employee morale should contribute to our

knowledge of the relationship that exists between them.

In this theoretical framework, organisational culture dimensions are independent variables and

employees' morale dimensions are a dependent variable. The present study thus attempts to

bridge the gap by providing a basis for a thorough and insightful discernment of organisational

culture and employee morale. The model suggests that the greater the extent to which these

eight dimensions of organisational culture are present, the greater will be the employee morale.

Also, in this chapter, details of the research design and questionnaire used for the survey are

provided. Also, we discuss sample and data collection procedures and operational measures of

variables used in the study as well as the statistical tests used to evaluate the hypothesis.

3.2 THE OBJECTIVES OF THE STUDY

The basic aim of this research is to assess the impact of the level of organizational culture on

an employee’s morale in selected banks and to find the relationship between them. So, the

various objectives which would be fulfilled by this report are:

1. To study the difference in the perceptions of employees regarding the organizational

culture at public and private sector banks.

2. To study the difference in the perceptions of the manager and staff level employees

regarding organizational culture.

3. To study the level of morale among the employees of public and private sector banks.

4. To find out the relationship between organizational culture and employee morale in the

respective banks.

28

3.3 RESEARCH HYPOTHESES

1. Private sector banks would manifest a better organizational culture than public sector

banks.

2. Private sector banks would have a higher level of employee morale than public sector

banks.

3. There is no difference in perception regarding the organizational culture between the

staff level and manager level.

4. There is no difference in perception regarding the employee morale between the staff

level and manager level.

5. The strong organizational culture is positively correlated with the high morale of the

employees.

3.4 RESEARCH DESIGN

A questionnaire survey was used to assess the impact of organizational culture on employee

morale in selected banks.

Survey research is defines as “the administration of questionnaires to a sample of respondents

selected from some population” (Babbie 1989, p.257). Survey research is especially

appropriate for making descriptive studies of large populations and may be used for

explanatory purposes as well. Also, it is relatively objective, can be anonymous and is able to

be analysed statistically. Hence, it is appropriate for this study.

3.5 SAMPLING PROCEDURE AND DATA COLLECTION

The target population of this study was the Banking Industry in the Tricity region (Chandigarh,

Panchkula & Mohali). A set of five banks (two private sector banks and three public sector

banks) were selected.

29

Private Sector Banks – ICICI & HDFC

Public Sector Banks – SBI, Central Bank of India & Union Bank of India

SBI and ICICI have been chosen for the study based upon their size in their respective sectors.

Both SBI and ICICI are the largest banks in their own arenas. HDFC has been chosen on the

premise that it own second maximum number of branches in Chandigarh as compared to other

banks in their respective sectors. The rest two were selected randomly.

The survey was conducted between December 2008 and January 2009.

The survey was the main form of data collection. The questionnaires were distributed to

employees from different job levels and functions within these organisations. They were either

personally distributed to each employee or were distributed through an officer/coordinator

from the organisation. The questionnaire consisted of two parts. The section-A consists of the

questionnaire developed by Udai Pareek and deals with the dimensions of organizational

culture and Section-B consists of the questionnaire developed by Nandita Kasal and deals with

the indices of employee morale. A total of 120 questionnaires were distributed to employees in

these organizations. Out of these, 91 usable questionnaires were returned, yielding a response

rate of 76%.

There were 43 (47.30%) female and 48 (52.70%) male respondents. Out of this group of

respondents, 28.6% aged were between 21-25 years old, 33% between 26-30 years old, 9.9%

between 31-40 years old and the remaining 28.6% aged over 40 years old. From the age group

results, we can conclude that these organisations consisted of a rather young population with

about 61.5% of them being younger than 30 years of age. Out of all the respondents, 62 (over

68.00%) had achieved a Postgraduation qualification. Employees from two types of

occupational groups were represented in the sample (i.e. managerial level, N = 40; staff level,

N = 51). And sector-wise, the respondents were equal in number from both the sectors. Also,

there were 20 respondents from State Bank of India, 12 from Union Bank of India, 14 from

Central Bank of India, 21 from HDFC and 24 from ICICI.

30

3.6 VARIABLE MEASUREMENTS

ORGANISATIONAL CULTURE DIMENSIONS

This measure is based on the eight dimensions of organizational culture developed by Udai

Pareek i.e. OCTAPACE Profile.

A brief introduction of the parameters is given below:

Openness

Openness can be defined as a spontaneous expression of feelings and thoughts, and the sharing

of these without defensiveness.

Confrontation

Confrontation can be defined as facing rather than shying away from problems. It also implies

deeper analysis of interpersonal problems.

Trust

It is reflected in maintaining the confidentiality of information shared by others, and in not

misusing it. It is also reflected in a sense of assurance that others will help, when such help is

needed and will honor mutual commitments and obligations.

Authenticity

Authenticity is the congruence between what one feels, says and does. It is reflected in owning

up one's mistakes, and in unreserved sharing of feelings. Authenticity is closer to openness.

Proaction

Proaction means taking the initiative, preplanning and taking preventive action, and calculating

the payoffs of an alternative course before taking action.

31

Autonomy

Autonomy is using and giving freedom to plan and act in one's own sphere. It means respecting

and encouraging individual and role autonomy.

Collaboration

Collaboration is giving help to, and asking for help from, others. It means working together

(individuals and groups) to solve problems and team spirit.

Experimenting

Experimenting means using and encouraging innovative approaches to solve problems; using

feedback for improving, taking a fresh look at things, and encouraging creativity.

Table 1: Tentative norms for OCTAPACE profile

Openness Confrontation Trust Authenticity Pro-action Autonomy Collaboratio

nExperimentin

g

Low 13 10 10 10 12 11 13 11High 17 16 16 14 18 16 17 16

EMPLOYEE MORALE

The following indexes of morale as found by Ms. Nandita Kasal are used for the purpose of

measuring it:

The Index Of Job Satisfaction:

Job satisfaction refers to the feelings and the emotional aspects that the individual experiences

towards his job as different from intellectual or rational aspects.

The Index Of Organisational Image:

This measures whether an employee opinion about his organization is one of pride or disgust or

whether his feelings are ambivalent.

The Index Of Career Growth:

32

This is a measure of the strength of an employee’s expectancy of a rewarding future in the

organization in the course of his performance being in lines with the goals of the organization.

The Index Of Satisfaction With Superiors:

It measures whether the leadership satisfies the common desires of the men over whom it is

exercised.

The Index Of Satisfaction Of Emotional And Physical Needs:

It measures the degree to which the emotional and physical needs of the employees are

satisfied.

Table 2: Tentative Norms for Employee Morale Profile

Index of Job Satisfaction

Index of Organisational

Image

Index of Satisfaction

with Superiors

Index of Career Growth

Index of Satisfaction of Emotional &

Physical NeedsLow 4 – 8 4 - 8 4 - 8 3 - 6 5 – 10

Medium 8 – 12 8 - 12 8 - 12 6 - 9 10 – 15

High 12 – 16 12 - 16 12 - 16 9 - 12 15 – 20

The Validity and Reliability of the Questionnaire

The Part A of the questionnaire, relating to the organisational culture as perceived by the

employee is based on the OCTAPACE profile as developed by Mr. Udai Pareek. This

instrument has a high degree of validity and reliability.

The Part B of the questionnaire deals with morale. It borrows heavily from the Brayfield and

Rothe' Index of job satisfaction, and the job satisfaction and morale questionnaire developed by

Dr. A.K.Srivastava et al for the measurement of employee job satisfaction. Both these

instruments have a high degree of validity and reliability. And the final questionnaire

developed by Ms. Nandita Kasal by the use of above two also have a high concurrent validity

and face validity.

33

The Part C of the questionnaire consists of demographic variables: name, age, gender,

educational qualification, designation, organization name and sector.

3.7 ANALYSIS OF DATA

The statistical computer programme used for the questionnaire data analysis was SPSS

Statistics 17.0. Central measures of tendency and standard deviation were calculated for each

variable. One way Anova test was used to test the hypotheses and to confirm the statistically

significant differences. Correlation studies were used to determine the relationship between the

dependent (employee morale) and independent variables (organizational culture).

34

4.1 INTRODUCTIONIn this chapter, the analysis of the results of the survey is presented. A demographic summary

of the sample used in provided in section 4.2.1. In the section 4.2.2, descriptive statistical

analysis of the variables is provided, while in section 4.2.3, correlation studies between the

organizational culture variables and employee morale variables is provided. And finally in

section 4.2.4, the testing of hypothesis is done.

4.2 RESULTS OF THE SURVEY

4.2.1 Demographic Summary

Table 3: Demographic Summary

VARIABLE RESULT

Age Median Range 26-30 years, modal range 26-30 years

Gender 47.30% female and 52.70% male

Educational

Qualification

32% Graduate and 68% Postgraduate

Level 44% from Managerial Level and 56% from staff level

Sector 50% from both public and private sector

35

4.2.2 Descriptive Statistical Analysis

The figure 4.0 shows the average means of the eight dimensions of organizational culture as

perceived by the employees of public and private sector banks.

Figure 4: Sector wise comparison of average means of eight dimensions of organizational culture.

When we compare the scores of Public Sector & Private Sector Banks with tentative norms of

octapace profile, the results show that Private sector Banks have scored higher than the Private

Sector Banks for all of the eight core values of culture for their organization.

The Private sector banks have scored high for seven of the eight core values of the

organizational culture. Those seven core values are openness, confrontation, trust, authencity,

proaction, collaboration, experimentation. It has scored low only on one dimension i.e.

autonomy.

On the other hand, the average responses for Public sector banks are in a low to medium range

for all the eight dimensions. The dimensions on which it has scored low are confrontation,

trust, proaction and experimentation, while the dimensions for which the public sector banks

have scored low are openness, authencity, autonomy and collaboration.

The standard deviations were quite high, indicating the dispersion in a widely-spread

distribution.

36

Figure 5: Sector wise comparison of average means of five indexes of employee morale.

Abbreviation

IJS Index of Job Satisfaction

IOI Index of Organisational Image

ISS Index of Satisfaction with Superiors

ICG Index of Career Growth

IEP Index of Satisfaction of Emotional & Physical Needs

When we compare the scores of Public Sector & Private Sector Banks with tentative norms of

employee morale profile, the results show that Private sector Banks have scored higher than the

Private Sector Banks for all of the five indexes of employee morale.

The Private sector banks have scored high for four of the five indexes of employee morale.

These four indexes are Index of Job Satisfaction, Index of Organisational Image, Index of

Career Growth, and Index of Satisfaction of Emotional & Physical Needs. It has scored

medium on one index i.e. Index of Satisfaction with Superiors.

On the other hand, the average responses for Public sector banks are in a medium range for all

the indexes except one index i.e. Index of Organisational Image on which they have scored

high.

37

Table 4: One-Way Anova Test : Organisational Culture & Employee Morale Dimensions By Sector

ANOVASum of Squares df Mean Square F Sig.

OBetween Groups 182.174 1 182.174 33.707 .000Within Groups 481.013 89 5.405Total 663.187 90

CNBetween Groups 179.757 1 179.757 30.465 .000Within Groups 525.144 89 5.900Total 704.901 90

TBetween Groups 55.180 1 55.180 9.592 .003Within Groups 511.963 89 5.752Total 567.143 90

ABetween Groups 54.770 1 54.770 10.852 .001Within Groups 449.186 89 5.047Total 503.956 90

PBetween Groups 44.924 1 44.924 4.745 .032Within Groups 842.681 89 9.468Total 887.604 90

AUBetween Groups 38.414 1 38.414 6.988 .010Within Groups 489.256 89 5.497Total 527.670 90

CBBetween Groups 179.942 1 179.942 52.016 .000Within Groups 307.882 89 3.459Total 487.824 90

EBetween Groups 174.178 1 174.178 41.591 .000Within Groups 372.723 89 4.188Total 546.901 90

IJSBetween Groups 152.176 1 152.176 40.316 .000Within Groups 335.934 89 3.775Total 488.110 90

IOIBetween Groups 20.812 1 20.812 6.218 .014Within Groups 297.913 89 3.347Total 318.725 90

ISSBetween Groups 56.142 1 56.142 10.574 .002Within Groups 472.539 89 5.309Total 528.681 90

ICGBetween Groups 75.372 1 75.372 29.108 .000Within Groups 230.452 89 2.589Total 305.824 90

IEPBetween Groups 225.398 1 225.398 27.419 .000Within Groups 731.635 89 8.221Total 957.033 90

38

Also, One–Way Anova Test was applied to test if there was a significant difference between

the two types of Banks for all the eight core values of organizational culture. An overall test of

the null hypothesis of no differences in means for all variables showed significant differences

between these two categories of banks. The results show that there were significant differences

between the public and private sector banks for all of the eight values of organizational culture:

openness (F=33.7, p<0.01), confrontation (F=30.47, p<0.01), trust (F=9.59, p<0.01),

authencity (F=10.85, p<0.01), pro-action (F=4.75, p<0.05), autonomy (F=6.99, p<0.01),

collaboration (F=52.02, p<0.01) and experimentation (F=41.59, p<0.01).

Similarly, One–Way Anova Test was applied to test if there was a significant difference

between the two types of Banks for all the five indexes of employee morale. An overall test of

the null hypothesis of no differences in means for all variables showed significant differences

between these two categories of banks. The results show that there were significant differences

between the public and private sector banks for all the five indexes of employee morale: Index

of Job Satisfaction (F=40.32, p<0.01), Index of Organisational Image (F=6.218, p<0.05), Index

of Satisfaction with Superiors (F=10.574, p<0.01), Index of Career Growth (F=29.10, p<0.01),

and Index of Satisfaction of Emotional & Physical Needs (F=27.419, p<0.01).

39

Figure 6: Level wise comparison of average means of eight dimensions of organizational culture.

When we compare the scores of Managerial & Staff Level employees of both the banks with

tentative norms of OCTAPACE profile, the results show that both the managerial level and

staff level employees have responded in an almost similar fashion for all of the eight core

values of culture for their organization with slightly little differences for some of the values.

The values of openness, authencity and collaboration are perceived to be higher in their banks

by the managerial level employees then the staff level employees, while autonomy is perceived

to be higher by the staff level employees than the managerial level.

Both the Managerial & Staff Level Employees have responded to these eight dimensions of

culture in a medium range. According to them, these dimensions are not present in a very high

degree in their banks, with autonomy being on the lesser side.

Figure 7: Level wise comparison of average means of five indexes of employee morale.

By comparing the scores of Managerial & Staff Level employees of both the banks with

tentative norms of Employee Morale profile, we find that like for the eight core values of

organizational culture, here also both the managerial level and staff level employees have

responded in an almost similar fashion for all of the five indexes of employee morale with

slightly little differences for some of the values except one Index of Satisfaction with Superiors

40

for which staff level have responded more favourably than the managerial level. The Index of

Job Satisfaction is perceived to be a little higher in their banks by the managerial level

employees then the staff level employees, while Index of Organisational Image is perceived to

be higher by the staff level employees than the managerial level.

Both the Managerial & Staff Level Employees have responded that the Index of Job

Satisfaction, Index of Satisfaction with Superiors and Index of Satisfaction of Emotional &

Physical Needs are present to a not so high level in their organizations while Index of

Organisational Image and Index of Organisational Image are present in a high degree in their

organizations.

Table 5: One-Way Anova Test: Organisational Culture & Employee Morale Dimensions By Level

ANOVASum of Squares df Mean Square F Sig.

OBetween Groups 5.506 1 5.506 .745 .390Within Groups 657.681 89 7.390Total 663.187 90

CNBetween Groups .115 1 .115 .014 .904Within Groups 704.786 89 7.919Total 704.901 90

TBetween Groups .233 1 .233 .037 .849Within Groups 566.910 89 6.370Total 567.143 90

ABetween Groups 3.828 1 3.828 .681 .411Within Groups 500.128 89 5.619Total 503.956 90

PBetween Groups 1.806 1 1.806 .181 .671Within Groups 885.799 89 9.953Total 887.604 90

AUBetween Groups 2.084 1 2.084 .353 .554Within Groups 525.586 89 5.905Total 527.670 90

CBBetween Groups 7.261 1 7.261 1.345 .249Within Groups 480.563 89 5.400Total 487.824 90

E Between Groups .007 1 .007 .001 .973

41

Within Groups 546.894 89 6.145Total 546.901 90

IJSBetween Groups 2.723 1 2.723 .499 .482Within Groups 485.387 89 5.454Total 488.110 90

IOIBetween Groups 3.892 1 3.892 1.100 .297Within Groups 314.833 89 3.537Total 318.725 90

ISSBetween Groups 17.667 1 17.667 3.077 .083Within Groups 511.014 89 5.742Total 528.681 90

ICGBetween Groups .012 1 .012 .004 .952Within Groups 305.812 89 3.436Total 305.824 90

IEPBetween Groups .964 1 .964 .090 .765Within Groups 956.069 89 10.742Total 957.033 90

Here also, One–Way Anova Test was applied to test if there was a significant difference

between the two levels of employees for all the eight core values of organizational culture and

the five indexes of employee morale. An overall test of the null hypothesis of no differences in

means for all variables showed no significant differences between the two levels of employees

for all the variables except for one variable which was Index of Satisfaction with Superiors

(F=3.077, p=0.83).

4.2.3 Correlation Analysis: Relationships between the variables

The correlation matrix in Table 6 indicates that all the dimensions of organisational culture

were positively and moderately correlated with dimensions of employees' morale.

There were strong positive relationships between confrontation and index of job satisfaction (r

= 0.63, p < 0.01), openness and job satisfaction(r = 0.591, p < 0.01), openness and satisfaction

with physical and emotional needs (r = 0.57, p < 0.01), collaboration and job satisfaction (r =

42

0.62, p < 0.01), collaboration and satisfaction with physical and emotional needs (r = 0.647, p

< 0.01) and between experimentation and job satisfaction (r = .596, p < 0.01).

The moderate positive correlations were for openness and organizational image (r = 0.424, p <

0.01), trust and job satisfaction (r = .492, p < 0.01), trust and satisfaction with physical and

emotional needs (r = 0.494, p < 0.01), authencity and satisfaction with superiors (r = 0.431, p <

0.01), proaction and organizational image (r = 0.472, p < 0.01), proaction and satisfaction with

superiors (r = 0.455, p < 0.01), collaboration and organizational image (r = 0.457, p < 0.01),

collaboration and career growth (r = 0.482, p < 0.01) and between experimentation and

satisfaction with physical and emotional needs (r = 0.442, p < 0.01).

The weakest correlation was for openness and satisfaction with superiors (r = 0.278, p < 0.01),

authencity and career growth (r = 0.184, p < 0.05), proaction and career growth (r = 0.205, p <

0.05), experimentation and organizational image (r = 0.295, p < 0.01) and between

experimentation and satisfaction with superiors (r = 0.258, p < 0.01). Also, another major

finding was that autonomy has the least impact on all the dimensions of employee morale with

(r <= 0.3).

Thus the findings show that the organizational culture has a positive impact on the employee

morale.

Table 6: Correlation of Organisational Culture Dimensions and Employee Morale Dimensions

Correlation of Organisational Culture Dimensions and Employee Morale Dimensions (N=91)

J ob satisfaction

O rganizational image

S atisfaction with

superiors

C areer growth

S atisfaction with physical

and emotional

needs

Openness Pearson Correlation .591** .424** .278** .403** .570**

Confrontation Pearson Correlation .630** .344** .353** .405** .402**

43

Trust Pearson Correlation .492** .392** .408** .347** .494**

Authencity Pearson Correlation .538** .335** .431** .184* .355**

Proaction Pearson Correlation .527** .472** .455** .205* .339**

Autonomy Pearson Correlation .299** .145 .255** .219* .173

Sig. (1-tailed) .002 .086 .007 .018 .051

Collaboration Pearson Correlation .620** .457** .366** .482** .647**

Experimentation Pearson Correlation .596** .295** .258** .394** .442**

**. Correlation is significant at the 0.01 level (1-tailed).

*. Correlation is significant at the 0.05 level (1-tailed).

4.2.4 Hypothesis Testing

The results of the survey provided the following conclusions relating to the hypothesis stated

earlier in this report.

Hypothesis 1:

Private sector banks would manifest a better organizational culture than public sector

banks.

Results in Figure 4 had shown that Private sector Banks have scored higher than the Private

Sector Banks for all of the eight core values of culture for their organization. And even the

Table 4 shows that there were statistically significant differences between the two types of

banks. Thus, Hypothesis 1 is accepted.

Hypothesis 2:

44

Private sector banks would have a higher level of employee morale than public sector

banks.

Results in Figure 5 had shown that Private sector Banks have scored higher than the Private

Sector Banks for all of the five indexes of employee morale. And even the Table 4 shows that

there were statistically significant differences between the two types of banks. Thus,

Hypothesis 2 is accepted.

Hypothesis 3:

There is no difference in perception regarding the organizational culture between the

staff level and manager level.

Results in Figure 6 show that both the managerial level and staff level employees have

responded in an almost similar fashion for all of the eight core values of culture for their

organization with slightly little differences for some of the values. And even the Table 5 shows

that there were no statistically significant differences between the two types of banks. Thus,

Hypothesis 3 is accepted.

Hypothesis 4:

There is no difference in perception regarding the employee morale between the staff

level and manager level.

Results in Figure 7 show that both the managerial level and staff level employees have

responded in an almost similar fashion for all of the indexes of employee morale except for one

Index of Satisfaction with Superiors and even Table 5 showed no significant differences

between the two levels of employees for all the variables except for Index of Satisfaction with

Superiors (F=3.077, p=0.83). Thus, a part of Hypothesis 4 is accepted.

Hypothesis 5:

The strong organizational culture is positively correlated with the high morale of the

employees.

45

The correlation shown in Table 6 (in section 4.2.3) suggest that in general, there were positive

and significant correlation between all the eight core values of organizational culture and five

indexes of employee morale. Hence, results from this study support Hypothesis 5.

46

5.1 Introduction

In this chapter, a summary and general discussion in relation to the results of the studies is

provided in section 5.2. Section 5.3 considers the possible limitations of this research and

suggests areas which may be useful to explore in future research. Section 5.4 provides the

conclusion for this chapter.

5.2 Discussion

The overall objective of this study was to compare the organizational culture and employee

morale among the private and public sector banks and investigate the impact of organisational

culture on employee morale. The setting used in this study was the banking sector and the

sample consisted of managerial level and staff level employees from the three public sector and

two private sector banks. This research was prompted by the lack of attention given in the

literature to the influence of organizational culture on employee morale.

The main results of the research in this study were derived from questionnaire survey.

The results of this study revealed that Private sector Banks have scored higher than the Private

Sector Banks for all of the eight core values of culture for their organization and even the

Private sector banks have scored high for seven of the eight core values of the organizational

culture except autonomy while the average responses for Public sector banks are in a low to

medium range for all the eight dimensions. Also, the Private sector Banks have scored higher

than the Private Sector Banks for all of the five indexes of employee morale. And the Private

sector banks have scored high on four indexes of employee morale except Index of Satisfaction

with Superiors. On the other hand, the average responses for Public sector banks are in a

medium range for all the indexes except one index i.e. Index of Organisational Image on which

they have scored high. The results show that there were significant differences between the

public and private sector banks for all of the eight values of organizational culture and the five

indexes of employee morale.

47

Further, the results show that both the managerial level and staff level employees have

responded in an almost similar fashion for all of the eight core values of culture for their

organization with slightly little differences for some of the values. And they have ranked the

presence of these eight dimensions of culture in a medium range.

Also both the managerial level and staff level employees have responded in an almost similar

fashion for all of the five indexes of employee morale with slightly little differences for some

of the values except one Index of Satisfaction with Superiors for which staff level have

responded more favourably than the managerial level.

Also, it was shown that no significant differences between the two levels of employees for all

the variables except for one variable which was Index of Satisfaction with Superiors (F=3.077,

p=0.83).

Further, the correlation analysis indicates that all the dimensions of organisational culture were

positively and moderately correlated with dimensions of employees' morale. Thus the findings

show that the organizational culture has a positive impact on the employee morale.

5.3 Limitations And Future Research

It is realised that there are some limitations that must be considered in future investigation.

Firstly, a major limitation of this study is the small sample size. As a result, the power of the

test is generally weaker. Secondly, the findings are based on the use of self-reported survey

data, which may be affected by response bias. Thirdly, data were collected at a single point in

time, which does not allow for changes in perceptions and attitudes over time. Fourthly, a

cross-sectional analysis cannot confirm the direction of causality implied in our research

model, so it is necessary to be cautious in conclusions regarding causality. Fifthly, the results

of this study may not be transferable to another business sectors as another sectors may not

operate under similar environmental or organizational settings. Furthermore, due to differences

48

in national cultures, the results of this study may not be applicable to countries which have

different organizational settings.

It is proposed that future research should include the types of organizational culture such as

consensual, entrepreneurial, bureaucratic and competitive using a similar approach. Finally, the

measure of employee morale comprises only a small number of items which tapped different

aspects of employee morale, and does not represent an overall view of employee morale;

therefore this is a considerable biased view of this study. Future research may be beneficial if

more items and better measures are developed in relation to this outcome variable.

5.4 Conclusion

In summary, this paper reports on an exploratory investigation of the relationship between

organisational culture and employees' morale based on five major Banks from both public and

private sector. This study endeavours to make both theoretical and practical contribution to the

literature, and it also contains several implications for further research. The findings enhance

our understanding of the organisational culture and employees' morale within the Banking

sector in the tri-city region. This research has also provided us with a better understanding of

the relationship between these factors in order to enhance managerial effectiveness and

organizational success. The findings stress the need to monitor organizational culture and to

evolve better management practices so that employees' morale is maintained at a high level. In

other words, the findings could prescribe potential practical implications for managers and

consultants in management development programmes consistent with the training needs of the

employees in the organisation. Hence, employees will be likely to perform better and feel a

high level of morale, and in turn will develop more commitment towards their organisations.

Finally, the higher levels of employees' morale in such organisations may give an advantage

over other organisations in attracting and retaining employees in a competitive environment.

49