Impact of Employee attitude and organizational climate on performance

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CHAPTER-1: INTRODUCTION INTRODUCTION

In this this age age of glob global aliz izat atio ion n orga organi nizat zatio ions ns get get conf confro ront nted ed with with incr increa easi sing ng worldwide competition all around. So it becomes very necessary for an organization to come up with a well thought-out and strategic business planning to be able to offer   products and services with additional value beyond competitor products and services. Employe Employees es can act strate strategic gic by contri contributi buting ng to the proper properly ly implem implement entati ation on of the  business strategy. The organization gains a competitive advantage from this strategic  behavior. Hence the performance of an organization depends a lot on the behavior of  employees working in it as well the climate prevailing in the organization. or this reason Human !esource "anagement #H!"$ is an important part of the strategic planning in an organization #%ecker& Huselid ' (lrich& )**+$. ,Humans are active individuals with past eperiences& internalized values& and norms that are not necessarily necessarily those of the employing organizatio organization n as said by /aauwe& )**0. 1ewin and 2artwright #+34+$ said that human behavior could be understood as a function of the individual person in its surrounding area. 5ccording to 6ames et al #)**7$ ,the various meanings that people associate with their physical surrounding areas are referred referred to as their psychological psychological environments. environments. or organizational organizational contets& 6ames and 6ones #+380$ call this aspect as psychological climate which refers to peoples9 attachment to their :obs& co-workers& leaders& e;uity of treatment and the like on individual level. In a summarized way we can say that employee behavior is a function of characteristics of the  person and characteristics of the individually perceived psychological climate in the organization. In this study psychological climate characteristics can be degree of trust& conflict& morale& rewards e;uity& leader credibility& resistance resistance to change and scape goating in the organization. %urton& 1auridsen and disposition to act9. Even 511/readiness9& >set9 or >disposition to act9. Even 511/an" an/

?in ,>an" )77@4, studied the influence of 

employees9 attitude towards their organization9s workplace health policies on their  organizational commitment and :ob satisfaction were eamined in a 2hina-based company with data collected from +)F workers and managers. The main hypotheses were that employees9 attitude towards =H/ were associated with #a$ their :ob satisfaction& #b$ and organizational commitment. Support was obtained for each hypothesis. Employees9 attitudes towards workplace health policies were both positively related to their :ob satisfaction and organizational commitment. However& the hypothesis that employees9 :ob levels related to their attitudes was not tested in this study. 5t last& implications and suggestions were given regarding developing workplace health policies in 2hinese organizations in this research.

G&est, Davi/ E an/ Cona5, Nei$ )77@4   eplored the link between human

resource management #H!"$& employee attitudes and workplace performance using the )**0 =orkplace Employment !elations Survey. It was found that there is an association  between a composite measure of H!" and workplace performance and between a composite measure of employee attitudes and workplace performance. %ut& in contrast to most previous research& there is no association between H!" and employee attitudes and a negative association between H!" and employee well-being. This study eplores some key issues concerning the relation between employee9s attitude towards human resource management #H!"$ and performance. These include the way in which they conceptualize and measure H!"& the nature of performance and the process whereby H!" and performance might be linked. The main focus is on the way H!" and  performance might be linked and in particular a core assumption in many models that H!" has its impact through its effect on workers attitudes and behavior.

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&thans, +re/, Norman, Steven !, Avo$io, Br&%e 6 an/ Ave5, ames B)77@4  ,

in their paper  investigated whether the recently emerging core construct of positive

 psychological capital #consisting of hope& resilience& optimism& and efficacy$ plays a role in mediating the effects of a supportive organizational climate with employee outcomes. (tilizing three diverse samples& results showed that employees9 psychological capital is  positively related to their performance& satisfaction& and commitment and a supportive climate is related to employees9 satisfaction and commitment. The study9s ma:or  hypothesis that employees9 psychological capital mediates the relationship between supportive climate and their performance was also supported. In conclusion& the results of  this study not only suggest the seeming value of employees9 psychological capital at all levels within organizations& but also the benefits that may result from organizations  providing positive& supportive climates. Since psychological capital is >>state-like99 and there is at least preliminary evidence that it can be developed & investing in and developing employees9 psychological capital may be an eample of the new thinking and new approaches that are needed for the >>flat world99 environment facing today9s organizations and their leaders.

i%htman, Ro.ert  )77@4, eamined how organizational climate factors& such

as opportunity for personal growth& development& advancement& etc.& influence the degree that supply chain managers perceive their work situation as facilitating their giving their   best effort #performance$ to their work. This study focuses on supply chain managers& as this is a new& important& and previously unstudied managerial group. It was hypothesized&  based on past research& that supply chain manag ers who perceived a supportive climate in their organization would feel that their work facilitates their giving their ,best effort at work while those supply chain managers who perceived their organizational climate as unsupportive would perceive their work situation as not conducive to their putting forth their best effort at work. The results indicated that of the si climate ;uestions dealing with self-fulfillment& advancement& interpersonal relations& etc.& supply chain managers who reported that their work environment facilitates putting forth their best effort indicated that they perceived their organization as providing a high degree of opportunity

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to achieve these factors. =hereas& supply chain managers who perceived their  organization as not supportive of these si factors perceived that their work environment did not facilitate their putting forth their ,best effort.

S'r&i$$, E/ri% 6)7734 , in his case ;uantified correlation factors between

organizational climate and employee performance at one specific division of an organization. The goal was to determine if the factors that defined organizational climate and employee performance could be correlated to a statistically significant degree that would then illustrate the need for leaders to understand what could influence the organizational efficiency and productivity of employees. 5n electronic web-based survey was utilized to collect survey responses from the participants. The demography consisted of employees below the senior manager level within the specific division. The results suggested that organizational climate is significantly correlated to employee performance according to +8 of +7 hypotheses.

Ri0etta, !i%hae$ )7734 conducted meta-analytic regression analyses on +B  ,

studies that had repeatedly measured performance and :ob attitudes #i.e.& :ob satisfaction or organizational commitment$. The effect of :ob attitudes on subse;uent performance& with baseline performance controlled& was weak but statistically significant #KL.*B$. The effect was slightly stronger for commitment than for satisfaction and depended negatively on time lag. Effects of performance on subse;uent :ob attitudes were elusive #KL .** across all studies$& which suggested that :ob attitudes are more likely to influence  performance than vice versa.

Voon, Boo-Ho, Hama$i, ami$ An/ Tan"0a&, ennier)7724   in their paper   ,

eamined the relationships among service climate& employee satisfaction& employee loyalty& and organizational performance of service organizations. The service-driven market orientation model of oon #)**B$ was adapted to gauge the service climate from the employee9s perspective. Structured ;uestionnaires were given to senior employees of  three selected service organizations. 5 total of +)* usable ;uestionnaires were analyzed and the findings indicate that service climate positively influence employee satisfaction&

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employee loyalty& and employee perceived organizational performance. There were also  positive relationships among employee satisfaction& employee loyalty and organizational  performance

N"o, Han"->&e +o$e5, Sharon an/ oi, Ra5mon/ )7724 in their paper tested a  ,

conceptual model to eamine the impact of family friendly work practices #=/s$ at the organizational level. In their model& top management support for e;ual opportunities is considered an antecedent of =/s and positive organizational climate& and firm  performance and employee turnover are considered outcome variables. Structural e;uation modeling #SE"$ was used to analyze the data collected from a sample of H!  managers in multinational corporations #"D2s$ in Hong Cong. The results showed that top management support for e;ual opportunities was positively related to a firm9s level of  =/s and organizational climate. In addition& =/s were positively related to organizational climate. They further found that organizational climate acted as a mediator   between =/s and firm-level outcomes.

ohnson, Diane E )7724  argued that these non-financial measures may be better   ,

 predictors of performance than traditional financial accounting measures. The assumed relationship between non-financial measures and performance is that non-financial measures drive performance. Employee attitudes often are used as non-financial measures of performance. However& Schneider et al . #)**Fb$ have developed a model that suggests performance #i.e.& financial outcomes$ drives employee attitude& rather than the reverse. Their research empirically eplores this relationship. Their findings suggested that financial performance leads to employee attitudes& most specifically when the financial performance improved. The findings were of interest to researchers #and practitioners$ in a number of important ways. "ost notably& they found that when eploring the relationship between financial performance and employee attitudes& it was important to investigate changes in financial performance rather than :ust levels of financial performance. =hen only levels of !