Influence of Organizational Culture on the Performance of Employees at Commercial Banks in Kenya

Abstract

The inability to develop and keep appropriate organizational culture, norms and values render many organizations unable to optimally tap on their human resource capabilities for betterment of the organization. The consequence being high employee turnover and low productivity that threatens the sustainability of many organizations with many dying or closing down few years after inception. Lack of organizational culture that guides organization and employees may derail employees’ performance. An appropriate organizational culture creates a favorable working environment for employees to exhibit their abilities whereas an organization characterized with negative and weak organizational culture tend to demoralize employees, including the more outstanding and promising employees with end results being poor employee performance. This study determined the influence of organization culture on employees’ performance at commercial banks in Kenya guided by descriptive survey research design. The study population was the top 10 tier commercial banks currently operating in Kenya as per the CBK report of 2020. Top 10 tier commercial banks were targeted because they have certain established organization culture guiding the bank operations. The unit of observation was top, middle and subordinate employees of the selected banks. There were 976 employees of the selected top tier commercial banks comprising 145 top management employees, 236 middle level management and 595 subordinate employees. Yamane (1967) formula was adapted to calculate a sample of 384 employees which was selected using stratified random sampling. A structured questionnaire was the main tool of collecting data. The primary data collected using questionnaire was entered in an excel sheet entered into SPSS version 20.0. The particular descriptive results were percentages, averages and measures of variance (Std Dev.). Simple linear regression as a form of inferential was adopted. The study revealed that organizational culture had a significant and positive effect (β=.418, p=0.000<0.05) on employee performance of commercial banks in Kenya. Regression analysis showed that organizational culture explains 53.0% of employee performance. The study concluded that employees are a key part of every organization and as such the organizational culture should be established in a way that allows the employees to bring out the better of their abilities so as to improve organizational performance as a whole. The study recommended that commercial banks in Kenya optimize organizational culture specifically adhocracy culture, hierarchy culture, clan culture and market culture in ways that maximize the performances of their employees.