Background of the study
Every institution, intentionally or unknowingly, creates its own culture. Corporate cultures encapsulate the ideals by which companies want to be recognized and identified. Culture refers to an organization’s consistent methods for conducting business and achieving long-term viability. It’s the way businesses operate and adapt to their internal and external environments, as well as the realities of the workplace. Organizations create their own culture, which contains the principles for which they want to be recognized and characterized, as well as a regular pattern of conduct (Schein, 2005; Wheelen & Hunger, 2006). Organizational culture may be influenced by the activities and purposes of organizations that have functioned effectively in the past and have translated into conventions, behavior, and expectations regarding ideal ways of thinking (Kotter & Hesket, 2000). If an organization’s ideals do not appear to be entrenched in a continuous pattern of conduct, there is no culture. When the culture’s ideals are recognized and followed consistently, consistency becomes a defining feature of the culture. As a result, corporate culture is found not just in the detailed declaration of principles that an organization aims to pursue or that ostensibly influence its operation and survival, nor in the declared manner in which a firm does its activities, but also in the consistency of the pattern of conduct.
Conversely, Egwuonwu (1998) stated that organizations in Nigeria have inconsistent cultures with no structure or protection for the future. People have continued to doubt if anything works in our company and society, particularly in the financial industry, because of the deceitful reputation connected with our culture. He went on to say that the banking sector’s tremendous failure, which resulted in turmoil, can be traced back to a lack of strong culture. Credit analysis and trust were obliterated as a culture. There was a time when the legal system of banking had no recognized culture, particularly during the liberalization of the foreign currency market. To support this, Strickland (2001) stated that banks can only expand if they have a strong culture that reinforces the pillars of their long-term survival.
Regretably, many banks have failed as a result of CEOs, directors, and staff tearing down the cultural pedestal on which they stand for self-promotion. Before a contemporary company can succeed, it must institutionalize a culture of respect and attention to detail. To harness the hidden store of expertise and inventiveness from its employees, the organization must love and appreciate them. There must be transfer of authority to these persons who direct the organization’s actions and determine its fate (George, 2003). As a result, there must be a match between culture and what it stands for in order to avoid a negative impact on the business.
Statement of the problem
Managers in the business sector face more obstacles in building an effective organizational culture, which is a critical component of improving performance and productivity. Due to difficult business qualities, many business managers struggle to thrive in a competitive worldwide market. More so is Increasing global pricing competitiveness and meeting the expectations of many stakeholders are among the issues. According to Bolboli and Reiche (2014), more than 90% of business excellence programs fail due to a lack of cultural integration among firm managers inside the corporate group. Within the group, there is a significant cultural divide that is a serious impediment to corporate performance (Weber & Tarba, 2012). In the business group, a lack of good organizational culture is a significant reason of low performance and productivity (Eaton & Kilby, 2015).
To increase the corporate group’s performance and productivity, business managers must recognize the value of an effective organizational culture. As a result, every firm must constantly assess organizational culture and determine the particular ways in which the current culture may hinder from corporate objectives. This would explain how and why culture may stifle performance when employees feel their approach to issues or way of doing things is the best and that it cannot be altered or improved when it is deemed insufficient. It’s much more important to assess the culture’s consistency. This is because if a firm has rules and regulations that are frequently disregarded, to the point where they simply exist on paper or are only implemented in exceptional instances, the organization does not have a rules and regulations culture. Similarly, if a firm sets recruiting and selection procedures but its directors and executives have influence over hiring decisions outside of these procedures, the organization lacks a reputable recruitment and selection culture.Thus it is upon this premise this study seeks to examine impact of organizational culture in the banking industry.
Objective of the study
The broad objective of this study is to examine the impact of organizational culture in the banking industry. Specifically the study seeks to:
1. Examine the extent at cultural fit affects organizational performance.
2. Identify the extent at which consistency of organizational practices affects organizational productivity.
3. Investigate the extent at which enactment of organizational culture affects the effectiveness of employees in banking industry.
4. Determine if consistency in the pattern of behavior among employee would affects survival of the bank.
HO1: Consistency in organizational practices would not affects organizational performance of banking industry.
HO2: Enactment of organizational culture consistency in the pattern of behavior among employee would not affects the productivity in banking industry.
Significance of the study
Findings from the study will be relevant to both public and private organizations especially managers and stakeholders of such organizations. The study results would provide relevant information for company managers in understanding the role of organizational culture. It will further explore successful strategies that senior company managers use to establish an effective organizational culture to improve performance. It will enlighten managers of financial institution on the need to entrench organizational culture that is consistent and inline with the organizational goal. Finally, Empirically, the study would add to the body of existing literature on related topic and serve as a reference material to both scholars and student who wishes to conduct further studies in related topic.
Scope of the Study
The scope of this study is to examine the impact of organizational culture in the banking industry. The study examined the extent at cultural fit affects organizational performance. It identified the extent at which consistency of organizational practices affects organizational productivity. It investigated the extent at which enactment of organizational culture affects the effectiveness of employees in banking industry. It determined if consistency in the pattern of behavior among employee would affects survival of the bank. The study is however delimited to Union Bank of Nigeria in Enugu State.
Limitation of the study
Like in every human endeavour, the researchers encountered slight constraints while carrying out the study. The significant constraint was the scanty literature on the subject owing to the nature of the discourse thus the researcher incurred more financial expenses and much time was required in sourcing for the relevant materials, literature, or information and in the process of data collection, which is why the researcher resorted to a limited choice of sample size. Additionally, the researcher will simultaneously engage in this study with other academic work. More so, the choice of the sample size was limited to banking industry as few respondent were selected to answer the research instrument hence cannot be generalize to other corporate organizations. However, despite the constraint encountered during the research, all factors were downplayed in other to give the best and make the research successful.
Definition of terms
Organizational Culture: Organizational culture is the collection of values, expectations, and practices that guide and inform the actions of all team members.
Organizational Performance: Organizational performance comprises the actual output or results of an organization as measured against its intended outputs (or goals and objectives).