Organizational Culture and Educational Institutions' Well-Being in Jordan

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1		Dina Ahmad alkhodary	--	3090	2023-12-17 17:57:32	\|
2	author name.	Dina Ahmad alkhodary	+ 8 word(s)	3098	2023-12-17 18:03:20	\| \|
3	layout	Camila Xu	-8 word(s)	3090	2023-12-18 03:16:22	\|

This entry is adapted from the peer-reviewed paper 10.3390/admsci13030092

Organizational culture refers to shared values, beliefs, behaviors, and practices within an organization, while well-being refers to the overall health, happiness, and satisfaction of employees and the organization’s ability to achieve its goals.

organizational culture companies well-being clan culture adhocracy culture

1. Introduction

Organizational culture and its relationship with well-being is a complex and multifaceted relationship. Organizational culture refers to shared values, beliefs, behaviors, and practices within an organization, while well-being refers to the overall health, happiness, and satisfaction of employees and the organization’s ability to achieve its goals (Sarala and Vaara 2020). A positive organizational culture can lead to increased employee engagement, productivity, and satisfaction, resulting in reduced turnover rates, increased innovation, and better financial performance (Sarala and Vaara 2020). In contrast, a negative organizational culture can lead to decreased employee morale, increased turnover, and a damaged reputation, resulting in decreased productivity and financial performance (Bernthal and Banister 2020).

The culture of a company can have a significant impact on its well-being in various ways, including its ability to attract and retain talented employees, its capacity to innovate and adapt to changes, and its overall financial performance (Cameron et al. 2020). Google and Zappos are examples of companies that have strong cultures of innovation, collaboration, inclusivity, customer service, and employee engagement, leading to their success in attracting and retaining top talent, generating revenue, and maintaining high levels of customer satisfaction (Youssef and Luthans 2007; Hsieh 2010).

Numerous studies have shown that a positive organizational culture can lead to better financial performance, higher levels of job satisfaction, organizational commitment, and employee well-being, and a higher level of adaptability and innovation (Laschinger et al. 2013; Great Place to Work Institute 2016; Sisodia et al. 2018; Denison Consulting 2018). Therefore, companies should focus on developing a culture that aligns with their values and goals, promotes employee engagement and well-being, and supports the company’s overall success (Schein 2017). The relationship between organizational culture and well-being is clear, as a strong culture can help companies attract and retain talented employees, drive innovation, and generate revenue, while a weak or toxic culture can harm a company’s reputation and financial performance.

2. Organizational Culture

Organizational culture is a critical aspect of organizational behavior that influences employee behavior, communication, decision-making, and the overall success of an organization. It can be defined as the shared values, beliefs, assumptions, and practices that shape the behavior and interactions of people within an organization. Several scholars have provided definitions of organizational culture, including Cameron et al. (2020); Denison Consulting (2018); and Schein (2017), all of which emphasize the importance of shared values and beliefs in shaping behavior and interactions within an organization. Understanding and managing organizational culture is essential for creating a positive work environment and achieving organizational success. In 2023, the definition of organizational culture remains largely consistent with earlier definitions, emphasizing the importance of shared values and beliefs. A study conducted by Abdi et al. (2018) examined the relationship between organizational culture, knowledge management, organizational learning, and innovation in the automotive industry. The study found that organizational culture and knowledge management have a direct positive effect on organizational innovation, while organizational learning plays a significant role as a mediator in this relationship. The study provides practical guidance for policymakers and managers in formulating policies and strategies for sustainable innovation and highlights the importance of innovation for the automotive sector to operate innovatively, competitively, and profitably.

3. The Importance of Organizational Culture

Organizational culture is a crucial factor that shapes the values, beliefs, and behaviors of employees within a company. It provides a framework for decision-making, communication, and problem-solving that influences how employees interact with each other, customers, and the wider community (Sisodia et al. 2018). Several studies have demonstrated the importance of a positive organizational culture in promoting employee well-being and productivity. For instance, a study by the University of Warwick found that happy employees are more productive than unhappy employees, with happy employees being 12% more productive than those who were not happy (Oswald et al. 2015). Another study by the Harvard Business Review showed that a strong organizational culture is linked to higher employee engagement, greater productivity, and improved financial performance (McCune and Peterson 2021; Schein 2021; Vasconcelos 2022; Keyworth et al. 2020). Companies with a strong culture had a 4-fold increase in revenue growth over a 10-year period compared to those without a strong culture. In addition, these companies had a 40% lower turnover rate than those without a strong culture, resulting in cost savings associated with recruitment and training. Organizational culture can be classified into different types, including Clan, Adhocracy, Market, and Hierarchy cultures. Each culture type has its unique characteristics and is often found in specific types of organizations (Tharp 2009). However, many organizations may exhibit elements of multiple culture types, or may evolve over time as the organization grows and changes. Different departments or teams within an organization may also have their own unique subcultures. The significance of organizational culture lies in the formation of connections and behavior patterns that all members of a company, whether they are managers or employees, must adhere to. This increases the organization’s capacity to adapt to change and stay up with changes occurring in the organizations surrounding it. Additionally, organizational culture helps to establish the required job conduct of each employee in the company, as well as the nature of their relationships with each other and with clients (Khaire and Roth 2021). It also establishes the language and attire worn by employees and preserves the organization’s stability.

Organizational culture benefits the management of the organization, aiding in the achievement of its aims and objectives. At work, it promotes innovation rather than rote behavior and unquestioning submission. It also directs others who are employed by the same organization and organizes their interactions, accomplishments, and labor. Recruiting workers who are ambitious, creative, and necessary to the organization’s goals facilitates managerial activities and decreases the instances where formal procedures are used to ensure that staff members exhibit the behaviors expected of them (Huang and Wang 2021). In conclusion, various studies suggest that organizational culture is a key driver of organizational success, as it shapes employee attitudes, behavior, and ultimately business outcomes. Therefore, organizations should focus on developing a strong and positive culture that aligns with their values and goals to promote employee engagement, productivity, and financial performance.

4. Types of Organizational Culture

According to various sources such as McCune and Peterson (2021); Schein (2021); Cameron et al. (2020); Vasconcelos (2022); and Tharp (2009), there are several types of organizational culture that can affect how employees work, how decisions are made, and the overall success of an organization. These culture types include the Clan culture, which emphasizes collaboration and teamwork; the Adhocracy culture, which values creativity and risk-taking; the Market culture, which prioritizes achievement and competitiveness; and the Hierarchy culture, which is characterized by structure and control. It is important to note that many organizations may exhibit a mix of these culture types, and that different departments or teams within an organization may have their own unique subcultures.

Clan culture: This type of culture emphasizes collaboration, teamwork, and employee empowerment. It is often found in family-owned businesses, small startups, or organizations that value a familial atmosphere. Employees in Clan cultures tend to work together closely, with a focus on building relationships and creating a sense of community.
Adhocracy culture: This type of culture is characterized by creativity, innovation, and risk-taking. These organizations tend to be dynamic and entrepreneurial, with a focus on experimentation and breaking the rules. Adhocracy cultures are often found in technology startups and other fast-paced industries.
Market culture: This type of culture is prioritizing results, achievement, and competitiveness. These organizations tend to be highly focused on external factors such as sales, profits, and market share. Employees in Market cultures are often motivated by financial incentives, and performance is closely monitored and measured.
Hierarchy culture: This type of culture is characterized by structure, stability, and control. These organizations tend to have a clear chain of command, with well-defined roles and responsibilities. Employees in Hierarchy cultures are expected to follow rules and procedures closely, and decision-making authority is typically centralized.

It is important to recognize that organizational culture is not always easily categorized into distinct types, and that organizations may demonstrate characteristics of multiple cultural types simultaneously or evolve over time. Moreover, different departments or teams within the same organization may exhibit their own unique subcultures. (McCune and Peterson 2021; Schein 2021; Cameron et al. 2020; Vasconcelos 2022; Tharp 2009).

5. Determinants of Organizational Culture

Organizational culture is a crucial factor for any business or organization, influencing the behavior, attitudes, and values of employees, which, in turn, affect the overall performance and effectiveness of the organization. The determinants of organizational culture are varied and depend on a range of factors, such as the environment, size, and objectives of the organization, the characteristics of individuals within the organization, the role of technology, and the organization’s history and ownership (Chatman and Cha 2020; Johnson 2021).

The environment in which an organization operates can have a significant impact on its culture, as it shapes the values and behaviors of employees. For instance, a company operating in a highly competitive market may prioritize performance and productivity, while a non-profit organization may prioritize social impact and community involvement. Similarly, an organization’s size and objectives can shape its culture, with smaller organizations having a more informal and collaborative culture, and larger organizations having more formal procedures and hierarchies. The objectives and goals of an organization can also shape its culture, as employees may prioritize different values and behaviors depending on the organization’s purpose and mission (Liao et al. 2020; Smith and Lewis 2020). Individuals within the organization also play a critical role in shaping organizational culture, as their values, attitudes, and behaviors can either reinforce or challenge the existing culture. Furthermore, the role of technology is becoming increasingly important in shaping organizational culture, as it can change the way employees communicate, collaborate, and work. Finally, the history and ownership of an organization can also influence its culture, as the values and traditions of the organization’s founders and leaders may continue to shape the organization’s culture long after they have left. Similarly, the ownership structure of an organization can influence its culture, with private companies prioritizing profitability and growth, while non-profit organizations prioritize social impact and community involvement (Liao et al. 2020; Smith and Lewis 2020). Overall, the determinants of organizational culture are complex and multifaceted, and a range of factors can influence the values, behaviors, and attitudes of employees within an organization. Leaders and managers seeking to create and maintain a positive and effective organizational culture must understand these determinants (Chatman and Cha 2020).

Organizational culture is shaped by a variety of factors, including the environment, size, objectives, technology, individuals, and history/ownership of the organization. The environment in which an organization operates can influence its culture, as it affects the values and behaviors of employees (Chatman and Cha 2020; Johnson 2021). The size of an organization can affect how it is managed and the methods used to handle different situations (Chatman and Cha 2020). An organization’s objectives can have a significant impact on its culture, as values related to these objectives will be emphasized (Liao et al. 2020; Smith and Lewis 2020). Technology is becoming increasingly important in shaping organizational culture, as different organizations prioritize different values and priorities related to technology (Liao et al. 2020; Smith and Lewis 2020). Individuals play a significant role in defining organizational culture, and the beliefs and attitudes of employees can either reinforce or challenge the existing culture (Chatman and Cha 2020). The history and ownership of an organization can also shape its culture, as the values and traditions of the organization’s founders and leaders may continue to influence the organization long after they have left (Liao et al. 2020; Smith and Lewis 2020). Ownership type, such as public or private, and whether an organization is local or international can also play a role in determining its culture (Chatman and Cha 2020). Understanding these determinants is crucial for leaders and managers seeking to create and maintain a positive and effective organizational culture. Organizational culture can also be influenced by factors such as leadership, vision and mission, structure and systems, communication, and workforce diversity, as discussed in various studies and reports. According to McKinsey and Company (2018), the leadership style and behavior of top management can significantly impact organizational culture, with consistent reinforcement of desired behaviors and values creating a strong, cohesive culture. An organization’s mission statement and core values, when clearly defined and communicated, can serve as a foundation for its culture. The organizational structure, policies, and procedures can also shape culture, with a focus on collaboration fostering a more egalitarian and collaborative culture. Communication can also influence culture, with open, transparent communication promoting trust and collaboration, as per Towers Watson (2013). Additionally, the composition of an organization’s workforce can impact its culture, with a diverse workforce fostering a culture of inclusivity and innovation, according to Hofstede and Hofstede (2001). Schein (2017) has also highlighted the importance of the above determinants in shaping organizational culture.

6. Well-Being

The promotion of well-being in the workplace involves a comprehensive approach that considers the physical, psychological, and social aspects of employee health and quality of life. Such initiatives aim to create a supportive work environment that fosters engagement, job satisfaction, and work-life balance. Well-being programs often include health screenings, fitness activities, stress management techniques, mental health support, financial wellness, and flexible work arrangements. Corporate well-being encompasses various factors such as physical, emotional, social, and environmental, and emphasizes the importance of promoting health and wellness to improve organizational performance. Studies show that prioritizing employee well-being leads to higher levels of engagement, retention, and productivity, as well as a better reputation among customers and investors (Deloitte 2021). Investing in employee well-being programs results in a return on investment of USD 1.50 to USD 4.50 for every dollar spent, due to increased productivity and reduced healthcare costs (Harvard Business Review Analytic Services 2021). The World Economic Forum (2019) found that companies that prioritize mental health and well-being have lower rates of absenteeism, presenteeism, and turnover. These findings demonstrate the advantages of well-being initiatives for both employees and the organization (Limeade 2021).

7. Employee Loyalty

According to Wright et al. (2003), employee loyalty is the level of dedication and connection an employee has to their employer, and their willingness to contribute to the organization’s long-term success. Saks (2006) defines employee loyalty as a component of employee engagement, which refers to a positive and fulfilling work-related state of mind characterized by vigor, dedication, and absorption, employee loyalty as an employee’s willingness to remain with their organization despite other external options and potential alternative employers, influenced by factors such as job security, job satisfaction, and trust in management. Employee commitment, on the other hand, involves an employee’s level of dedication, loyalty, and engagement towards their organization and its goals. According to González-Romá et al. (2006), employee commitment refers to an employee’s psychological attachment and loyalty to their organization, as well as their willingness to put in effort on behalf of the organization and its objectives, motivated by a sense of responsibility towards its success. Meyer and Herscovitch (2001) also highlight that employee commitment involves an employee’s willingness to exert effort on behalf of their organization and its goals, and their psychological attachment and loyalty to it. Employee commitment is crucial for organizational success, as it encourages employees to work enthusiastically towards achieving excellent results and promotes employee retention and advocacy for the organization.

8. Employee Creativity

Creativity in the workplace can be described as the process of generating original and valuable ideas or solutions that are relevant to the task at hand. According to Chen et al. (2020), employee creativity is defined as the creation of new ideas, products, or solutions that contribute to individual, team, or organizational goals, and are both original and appropriate. This definition highlights the significance of employee creativity for achieving goals at different levels and the importance of ideas being both novel and relevant. Other scholars such as Runco and Jaeger (2012) and Sternberg and Lubart (1999) also define creativity as the production of original and useful ideas that lead to innovation and better solutions to problems. Although there are differences in how creativity is defined, there is a consensus that it involves developing novel and useful ideas that are appropriate to a particular context. Shahzad et al. (2017) found that corporate culture can have an impact on innovation, which Ahmed and Shepherd (2010) define as the creation of new products, services, processes, and ideas that use available resources, and is measured by factors such as opportunity exploration, generativity, informative investigation, championing, and application, as noted by Kleysen and Street (2001).

9. Employee Productivity

Employee productivity refers to the quantity and quality of work produced by an employee over a given time period, typically measured in terms of efficiency, effectiveness, and output. As defined by Vining et al. (2014, p. 11), “employee productivity is the ratio of output to input and represents the degree to which an organization can utilize its resources to attain its goals.” Arora and Singh (2019, p. 25) define employee productivity as “a measure of an employee’s output within a specified time frame, which indicates an individual’s ability to generate results while adhering to the given limitations.” Similarly, Salman and Khan (2019, p. 35) define employee productivity as “the extent to which an individual or team can carry out their duties proficiently, effectively, and produce high-quality work that meets or surpasses expectations.” These definitions highlight the significance of achieving goals, generating outcomes within constraints, and meeting or exceeding expectations as crucial components in measuring employee productivity. Studies conducted by Mahdiyeh et al. (2016) and Kelepile (2015) have shown that organizational culture can influence productivity, productivity can be viewed as both a process and a result, where it is the proportion of output of goods and services to the resources used to create them. As a process, productivity refers to employees’ ability to generate products and services to the anticipated standards or beyond them (Meneze, in Mawanza 2017). Productivity can be evaluated as a process by assessing knowledge, skills, attitudes, and behaviors (Bernardin and Russell 2013). Conversely, productivity can be evaluated as a result by analyzing the input–output ratio.

10. Conceptual Framework

The researcher has constructed this study’s conceptual framework, which identifies corporate culture as the independent variable, with four distinct types: Clan, Adhocracy, Market, and Hierarchy. The sources utilized to define these cultures include Chatman and Cha (2020); Johnson (2021); Liao et al. (2020), and Smith and Lewis (2020). Meanwhile, the dependent variable is institutional well-being, which is gauged by employee loyalty, creativity, and productivity. The sources employed to define these variables consist of Kaplan and Golin (2021); Meyer and Herscovitch (2001); Chen et al. (2020); Arora and Singh (2019); Vining et al. (2014); and Meneze (Mawanza 2017).

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