Indicator of Organisational Health Organsiational Climate

By
Berinder Singh Kullar
Introduction
Organisations are distinguishable in many ways from each other in ways the employees feel,
behave and work. The attitudes of employees vary in terms of their behavior towards their job,
towards their co-workers, towards their customers and also towards themselves. This behaviour is
affected by the organization itself by offering the conditions for employees to work. These
conditions are often referred to as Climate and the variance in this climate directly attributes and
can be a powerful influence on individuals expectations, behaviour and performance. It can also be
equated with the employees perception of environment existing in an organisation how it feels to
be a member of the organisation. This psychological environment of an organisation which affects
employees behaviour is commonly referred to as Organisational Climate.

Organisational Climate is different from commonly misunderstood and majorly confused with
Organisational Culture. Organizational Culture refers to the shared realities, values, symbols and
rituals held in common by members of an organization that contribute to the creation of norms and
expectations of their behaviour (Scholl, 1983; Schein, 1990; Shockley-Zalabak and Morley, 1989).
The perception of this atmosphere that is how it feels to be a member of the organization is often
referred to as Organizational Climate (Cooke and Rousseau, 1988). While organizational climate
can be a powerful influence on individuals' expectations, behaviour and performance, the effect of
the organizational context naturally may vary across organizations and may affect individuals or
groups in the same organization differently (Mowday and Sutton, 1993).

Organisational Climate: Indictors to Performance

Wide research on the subject demonstrate that the organizational climate, the way people
think about working for an organization, has a considerable and significant impact on human
performance. It is evident that the way employees perceive the leadership and his management
team drives the organizational climate and employee performance. Reichers and Schneider (1990)
1

define organisational climate as "the shared perception of the way things are around here"1. It
hence becomes an important indicator of organizational performance, which is varied within
different organizations. These varied organizations have begun to pay considerable attention to
their organizational culture and climate in recent years, since, it is widely assumed that the informal
norms and perceived atmosphere of an organization may make some individuals feel accepted and
welcomed and others, marginalized or not taken seriously. This sense of fitness within the
organization's climate and culture influences an employees satisfaction level with that environment
to some degree.

Organizational Culture refers to the shared realities, values, symbols and rituals held in
common by members of an organization that contribute to the creation of norms and expectations
of their behaviour (Scholl, 1983; Schein, 1990; Shockley-Zalabak and Morley, 1989). The
perception of this atmosphere that is how it feels to be a member of the organization is often
referred to as Organizational Climate (Cooke and Rousseau, 1988). While organizational climate
can be a powerful influence on individuals' expectations, behaviour and performance, the effect of
the organizational context naturally may vary across organizations and may affect individuals or
groups in the same organization differently (Mowday and Sutton, 1993).

The banking industry is a great user of technology in modern era and is reliant upon fairly
sophisticated computer applications for operations, accounting and monitoring of financial
transactions. Operational management systems, marketing and finance vary in their sophistication
depending upon, principally, the size of the banking corporation and its global expanse.
Notwithstanding technology as a lever, most importantly contributor to a bank is its staff, which has
the biggest impact upon how the process of banking services are provided. The use of tacit skills,
those that interpret the contextual framework and acknowledge the shared perception of customer
and staff member, are crucial to the enhancement of the service experience (Lammont and Lucas,
1999)2. Of crucial importance to the success of an enterprise is the employee perceptions of their
organization as expressed through the concept of organisational climate, and the employees
relationship with customers (Schneider, 1994; Frances e, 1993; James & James, 1989; Jones and
James, 1976; Kopelman, Brief & Guzzo, 1990; Sinclair, 1996; Price & Chen, 1993; Shea, 1996,
and others). Organisational climate, as represented by the aggregation of the perceptions of
1

http://www.businessperform.com/html/success_and_significance.html.

Lammont, N., & Lucas, R. (1999) Getting by and getting on in service work: Issues for the future of
accounting. Critical Perspectives in Accounting, 10, 809 - 830.

individual employees within the organization, has been the focus of considerable empirical research
that can be traced back to the work of Lewin, Lippitt and White (1939)3. The large body of climate
research - much of this has been included in the literature review in later chapter has been subjected
to considerable theoretical debate. This debate concentrates on the methodological issue of how the
construct of climate can be translated into an indicator of organisational effectiveness and
productivity. Schneider and Bowen (1985)4 and Cole, Bacayan and White (1993) have provided
evidence that a good organisational climate does have a positive effect upon service outcomes and
hence improves organisational success.

Organisational Climate and Psychological Climate: The perception of this atmosphere

that is how it feels to be a member of the organization is often referred to as organizational
climate (Cooke and Rousseau, 1988). In todays management consultancy parlance, the notion of
Change Management is often thought of as cultural change. In many cases, in fact, it should be
organisational climate change. Organisational climate will be used for both constructs. In essence,
organisational climate is an individual attitude toward the organization and can be subject to change
when circumstances change.

Organisational Culture. It is the framework that is engendered by the organisational

systems and beliefs. It is relatively slow to form but, has a high degree of permanency.
Organizational culture refers to the shared realities, values symbols and rituals held in common by
members of an organization that contribute to the creation of norms and expectations of behaviour
Organisational climate can also be defined as a relatively enduring characteristic of an
organization which distinguishes it from other organizations.

(a)

Embodies members collective perceptions about their organization with respect to

such dimensions as autonomy, trust, cohesiveness, support, recognition, innovation, and

fairness.
(b)

Is produced by member interaction.

(c)

Serves as a basis for interpreting the situation.

Lewin, K., Lippitt, R., & White, R. (1939). Patterns of aggressive behavior in experimentally created social
climates. Journal of Social Psychology, 10, pg 271 299.
4

Schneider, B., & Bowen, D.E. (1985). Employee and customer perceptions of service in banks replication and
extension. Journal of Applied Psychology, 70, 423 433.

(d)

Reflects the prevalent norms, values and attitudes of the organizations culture; and

(e)

Acts as a source of influence for shaping behavior.5

In the literature on organizational climate there has been some confusion about the
relevance and definition of the concept and its relationship with organization structure and
organization culture6 , where the culture is a pattern of knowledge, belief and behavior that emerges
including social forms. In the context of the organization social forms and knowledge in general,
culture includes the organizational structure. The organizational culture is the organization
itself...the form, beliefs, norms, social patterns, the way things are done, the symbols, rituals, etc.

In the literature, it can be found, the use of climate is to represent seemingly different
concepts. Climate can be seen as organizational climate or psychological climate. It is stated that
the organizational climate arises in the confrontation between individuals and the organizational
situation. James and Jones (1974) say that the organizational climate can be viewed in two different
ways: a multiple-measurement-organizational attribute approach or a perceptual measurementsorganizational attribute approach7. Both of these approaches are confounded with organizational
structure and processes and the general organization situation. The organizational climate is
measured using variables like individual, autonomy, the degree of structure imposed as the
positions, reward orientation, consideration, warmth, and support. This is also the case in the
treatment of organizational climate dimensions presented, where organizational climate is measured
along the following dimensions: structure, responsibility, warmth, support, reward, conflict,
standards, identity, and risk8. It is further stated that climate seems to be a feature of, rather than a
substitute for culture. That is, a comprehensive view of organizational culture includes the
organizational climate.

Moran, E.T. & Volkwein, J.F. (1992). The cultural approach to the formation of organizational climate. Human
Relations, 45, 19 - 47.
6

James, L.R, James. L.A., & Ashe, D.K. (1990). The meaning of organizations: The role of cognition and values.
In Schneider, B. Organizational Climate and Culture. San Francisco: Josey Bass.
7

James, L.R. & Jones, A.P. (1974). Organizational climate: A review of theory and research. psychological
Bulletin, 81, 1096 1112.
8

Litwin, G. & Stringer, R. (1968). Motivation and organisational climate. Cambridge, MA: University Press.

It is obvious from the above that measures and dimensions of organizational climate and
organizational culture can be confused. This has been discussed often in the literature. 9 Denison
concludes that although the two concepts on the surface look very different, at a deeper level the
clear distinctions begin to disappear10. With the exception of the first definition for psychological
climate, the climate and the culture definitions and measures are confounded or overlapping.
Table 3.1 : Contrasting: Organisational Culture and Organisational Climate11
Research Perspective

Cultural Literature

Climate Literature

Epistemological

Contextualized and
idiographic

Comparative and
Nomothetic

View Point

Emic (native view)

Etic (researchers views)

Methodology

Qualitative Observation

Quantitative Data

Temporal Orientation

Historical Evolution

A historical snapshot

Level of analysis

Underlying values and

beliefs

Surface level manifestations

Discipline

Sociology

Psychology

For this study, the two concepts are quite distinct. The climate is the internal atmosphere of
the organization. The culture is the pattern of behavior, which includes the organizational form.
They are not the same, nor is one contained in the other. The organizational climate is the
psychological climate of the organization. The definition of the psychological climate is precise; it
refers to the perceptions held by the individuals about the work situation. James and Jones
summarize the psychological climate to be a set of summary or global perceptions held by
individuals about their organizational environment12. The psychological climate is a summary
feeling about actual events based upon the interaction between actual events and the perception of
those events. The psychological climate has been measured using dimensions such as
9

Schneider, B. (1990). Organizational climate and culture. San Francisco: Josey Bass.

10

Denison, D.R. (1996). What is the difference between organizational culture and organizational climate? A
natives point of view on a decade of paradigm wars. Academy of Management Review, 21, 610 654
11

Denison, D.R. (1996). What is the difference between organizational culture and organizational climate? A
natives point of view on a decade of paradigm wars. Academy of Management Review, 21, 610 654.
12

Jones, A.P. & James, L.R. (1979). Psychological climate: Dimensions and relationships of individual and
aggregated work environment perceptions. Organizational Behaviour and Human Performance, 23, 201 250.

disengagement, hindrance, esprit, intimacy, aloofness, production emphasis, trust and

consideration.

Organisational climate has much to offer in terms of its ability to explain the behaviour of people in
the workplace. Ashforth put forward the view that climate has the potential to facilitate a truly
integrative science of organisational behaviour13.

(a)

Schneider later discussed climate in terms of: the atmosphere that employees

perceive is created in their organizations by practices, procedures and rewards

Employees observe what happens to them (and around them) and then draw conclusions
about the organization's priorities. They then set their own priorities accordingly. 14
(b)

Schneider, Brief and Guzzo argue that sustainable organisational change is most

assured when both the climate - what the organizations members experience - and the
culture - what the organizations members believe the organization values - change15.
(c)

Other empirical studies have claimed that climate has a considerable impact upon

organisational effectiveness (Campion, Medsker & Higgs, 1993; Drexler, 1977; Franklin,
1975; Fredrickson, Jensen & Beaton, 1972; James & Jones, 1989; Likert, 1961, 1967;
Furnham & Drakeley, 1993; Lawler, Hall & Oldham, 1974; Kanter, 1983; Mudrack, 1989;
Schneider, Brief & Guzzo, 1996; Schneider, Gunnarson & Niles Jolly, 1994, and others).

Construction of Climate
The role of climate is crucial in any organisational improvement process that requires the
implementation of a major organisational change, or innovation. The research on psychological
climate has tried to relate the measure to other concepts such as job satisfaction, job attitude etc.
The important issue is whether the psychological climate influences the behavior of the individuals
and the organization and if there exists interaction effects with contingency factors and/or structural
factors of the organization. In an overall organizational model climate can be seen as an intervening
variable in the process between input and output, and one that has a modifying effect on this

13

Ashforth, B.E. (1985). Climate formation: Issues and extension. Academy of Management Review, 10, 837
847.
14

Schneider, B., Gunnarson, S.K., & Niles-Jolly, K. (1994). Creating the climate and culture of success.
Organizational Dynamics, Summer, 17 29.
15

Schneider, B., Brief, A.P. & Guzzo, R.A. (1996). Creating a climate and culture for sustainable organizational
change. Organizational Dynamics, Spring, 7 19.

process. Climate affects organizational and psychological processes, and thus acquires an influence
over the results of organizational operations. Hence, it is concluded that the organizational climate
can be measured as the individuals perception of the organizations psychological climate. Early
formulations of the climate construct. The concept of climate can be traced back to the work of
Lewin, Lippitt and White (1939) and a work entitled Patterns of aggressive behaviour in
experimentally created social climates (Denison, 1996; Schneider, 1990). The Lewin et. al. (1939)
study investigated the relationship between leadership style and climate, a factor that has remained
central to the concept. Joyce and Slocum (1982) trace the concept back to the studies of Koffka
(1935) on behaviour environment; Lewins (1936) study on life space; and Murrays (1938)
work on organisational climate.
Lewins concept of life space, has been explained by Krech and Crutchfield as: the
individuals total conception of the worlds in which he exists ... It includes his knowledge, beliefs
and memories and his view of the past and future as well as of the present; and it may include
domains of life reached after mortal death - heaven and hell paradise and purgatory. It is not, of
course, the same as the actual physical and social environments described by the outside observer.
It is what exists subjectively for the person. His life space may correspond in some way with the
actual external environment but it also deviates from them in radical degree, and varies markedly
from life spaces of other people. (Krech & Crutchfield, 1961, p. 210)
In the understanding of the differences between culture and climate, Lewins (1951)
approach to climate was conceptualized by the relationship between individuals, their social
environment and how that is set in a framework. Lewin expressed this in terms of the simple
equation:

B = f (P.E.)
in which B= Behaviour, E = Environment, and P = the person

It is clear from Lewins equation that the concept of climate takes a psychological approach,
focusing upon the individual and seeking to understand the cognitive processes and behaviour.
Lewins conceptualization of the theory provides the underpinnings of many studies and
approaches to climate research.

Approaches to the Climate Construct

Following the seminal work of Lewin et. al. (1939), obtaining consensus as to the definition of
climate has been difficult as the climate construct is complex and many different researchers have
used the same terminology to mean different things to the extent that providing a definitive
description of climate has been likened to nailing jello to the wall16 (Schneider, 1990). Others
have argued that if the use of the same term to mean different things continues, climate research
will grind to a stop in an assemblage of walled in hermits each mumbling to himself words in a
private language that only he can understand17 (Boulding, cited in Glick, 1988). James and Jones
(1974) conducted a major review of the theory and research on organisational climate and
identified climate in three separate ways that were not mutually exclusive:-

(a)

Multiple measurement - organisational attribute approach,

(b)

Perceptual measurement organisational attribute approach, and

(c)

Perceptual measurement individual attribute approach.

In the multiple measurement organisational approach they cite Forehand and Gilmer (1964) as
defining organisational climate as a set of characteristics that describe an organization and that

(a)

Distinguish the organization from other organizations.

(b)

Are relatively enduring over time, and

(c)

Influence the behavior of people in the organization. (Forehand & Gilmer, 1964 p.

3621 cited in James & Jones , 1974)

The perceptual measurement organisational attribute approach seeks to define climate in

terms of individual perceptions of the organization and it is these perceptions that influence
behaviour. James and Jones (1974) reported that the Campbell, Dunnette, Lawler & Weick (1970)

16

Schneider, B. (1990). Organizational climate and culture. San Francisco: Josey Bass, pg 1.

17

study which itself had synthesised Kahn, Wolfe, Quinn, Snoek & Rosenthal (1964), Litwin &
Stringer (1968) and Schneider & Bartlett (1968).

It must be remembered that such dimensions of climate are not always clearly
distinguishable from other variables that might fit into categories such as organisational structure,
process, system values and norms. The reliance upon perceptual measurement may mean that
organisational climate also includes some situational characteristics as well as individual perceptual
differences and attitudes. Whilst James and Jones (1974) note considerable criticism of this
approach, they reaffirm that there is both rational and empirical evidence to support that which is
being measured by the perceptual questions are variables related to different levels of explanation.
In reviewing psychological climate as a set of perceptually based, psychological attributes (rather
than the conceptualized independent or structural variable) Jones and James (1979) noted that the
process reflected the developments that had occurred in the conceptualization of climate and the
nature of its major influences. They propose that psychological climate,

(a)

Refers to the individuals cognitively based description of the situation;

(b)

Involves a psychological processing of specific perceptions into more abstract

depictions of the psychologically meaningful influences in the situation;

(c)

Tends to be closely related to situational characteristics that have relatively direct

and immediate ties to the individual experience; and

(d)

Is multi-dimensional, with a central core of dimensions that apply across a variety of

situations (though additional dimensions might be needed to better describe particular

situations. (Jones and James, 1979, p. 205)

However, Schneider and Hall (1972) describe climate as a global perception held by
individuals about their own organisational environment. Schneider and Snyder (1975) further
clarified the approach by defining climate as a summary perception which individuals form of (or
about) an organization. For them it is a global impression of the organization. The global nature of
organisational climate does not suggest that the concept is uni-dimensional. Many different types of
events, practices and procedures may contribute to the global or summary perception individuals
have of their organization. Within the current study, organisational climate is conceptualized as a
9

construct created by the activities of the organization. It is not the activities themselves, which is a
distinction that is not always clear in some of the earlier works. Schneider (1975) refined the
definition of climate to include meaningful apprehensions of order for the perceivers that are based
on the equivalent of psychological cues. Whilst this definition has some common elements with
James & Jones (1974) and Jones & James (1979) constructs, its focus shows a movement from
definitional issues toward a concern for people and their view of climate and what impact it has for
the organization. It is a way of apprehending order and a way of judging the appropriateness of
behaviour.

Dimensions of Climate Construct

The definitions and theoretical positions on climate have varied considerably between the
individual theorists. This has also been the case for the dimensions of climate and its measurement.
An initial assumption of theory and research in the area of organizational climate was that social
environments could be characterized by a limited number of dimensions. For example, Campbell,
Dunnette, Lawler, and Weick (1970) identified four dimensions common to a number of climate
studies (individual autonomy; degree of structure imposed on the situation; reward orientation; and
consideration, warmth, and support) 18. Jones and James (1979) argued that one of the assumptions
of the climate literature is that a relatively limited number of dimensions could characterize a wide
cross-section of social settings.

Jones and James (1979) initially administered their 145 item instrument to a large sample of
4315 US Navy personnel19. An exploratory Principal Components Analysis (PCA) produced a six
factor (eigen values greater than unity) solution. Jones and James labeled their factors as follows:

(a)

Conflict and ambiguity, which reflected perceived conflict in organisational goals

and objectives, combined with ambiguity of organisational structure and roles, a lack of
interdepartmental cooperation, and poor communication from management. Also included
were poor planning, inefficient job design, a lack of awareness of employee needs and
problems, and a lack of fairness and objectivity in the reward process.

18

Campbell, J. P., Dunnette, M. D., Lawler, E. E., & Weick, K. E. (1970). Managerial behavior, performance,
and effectiveness. New York: McGraw Hill.
19

Jones, A.P. & James, L.R. (1979). Psychological climate: Dimensions and relationships of individual and
aggregated work environment perceptions. Organizational Behaviour and Human Performance, 23, 201 250.

10

(b)

Job challenge, importance and variety, which reflected a job perceived as

challenging, important to the Navy, which involved a variety of duties, including dealing
with other people. The job was seen as providing autonomy and feedback, and demanding
high standards of quality and performance.

(c)

Leader facilitation and support, which reflected perceived leader behaviors such

as the extent to which the leader was seen as helping to accomplish work goals by means of
scheduling activities, planning, etc., as well as the extent to which he was perceived as
facilitating interpersonal relationships and providing personal support.

(d)

Workgroup cooperation, friendliness, and warmth, which generally described

relationships among group members and their pride in the workgroup.

(e)

Professional and organisational esprit, which reflected perceived external image

and desirable growth potential offered by the job and by the Navy. Also included were
perceptions of an open atmosphere to express ones feelings and thoughts, confidence in the
leader, and consistently applied organisational policies, combined with no conflicting roles
expectations and reduced job pressure.

(f)

Job standards, which reflected the degree to which the job was seen as having

rigid standards of quality and accuracy, combined with inadequate time, manpower,
training, and resources to complete the task.

Jones and James applied their instrument to two other samples of health managers and
firemen. PCA analysis in both of these cases extracted 6 factors with eigen values greater than
unity. Analysis of the items on each factor, however, revealed only 5 factors to be common across
the three samples (Conflict and ambiguity, job challenge, importance and variety, leader facilitation
and support, workgroup cooperation, friendliness, and warmth, and professional and organisational
esprit). Jones and James reviewed the comparability of the results found in their US Navy sample
and the findings of other similar studies.

James and Jones (1974) reported that the Campbell, Dunnette, Lawler & Weick (1970)
study which itself had synthesised Kahn, Wolfe, Quinn, Snoek & Rosenthal (1964), Litwin &

11

Stringer (1968) and Schneider & Bartlett (1968) had proposed four organisational climate
dimensions.

(a)

Individual autonomy based on the factors of individual responsibility, agent

independence, rules orientation and opportunities for exercising individual initiative.

(b)

The degree of structure imposed upon the position based on the factors of

structure, managerial structure and the closeness of supervision.

(c)

Reward orientation based upon the factors of reward, general satisfaction,

promotional-achievement orientation, and being profit minded and sales oriented.

(d)

Consideration, warmth and support based upon the factors of managerial support,

nurturing of subordinates, and warmth and support.

Denison (1996) argues that developing a universal set of dimensions was often the central
issue of the climate researchers so that comparative studies could be made possible in different
organisational settings. He compared this approach to that of the culture research that used a postmodern perspective which examined the qualitative aspects of individual social contexts where
each culture that was examined was seen as unique and was not expected to have generalisable
qualities which had become central to the climate research. It is possible that the dependence on the
use of climate surveys as the research method of choice led those working in the climate area to
seek generalisable qualities across settings. Koys and DeCotiis define the psychological climate as
an experimental-based, multidimensional, and enduring perceptional phenomenon which is widely
shared by the members of a given organizational unit. They state that the psychological climate is
the descriptionand not the evaluationof experience. As such, the psychological climate is
different from evaluations, e.g. job satisfaction. In their survey Koys and DeCotiis report more than
80 different dimensions found in the literature which has been labeled a climate dimension. They
set out to find a theoretical-meaningful and analytical-practical universe of all possible climate
dimensions. They established three rules for a dimension to be included in the universe:

(a)

Has to be a measure of perception.

(b)

Has to be a measure describing (not evaluating).

(c)

Must not be an aspect of organizational or task structure.

12

Zammuto and Krackover and Koys and DeCotiis both define climate using seven relatively similar
dimensions20. Table 3.2 shows the two sets of climate dimensions.

Table 3.2 Dimension of Climate

Koys and DeCotiis (1991)

Zammuto and Krackover (1991)

Autonomy

Credibility

Cohesion

Conflict

Trust/support

Trust

Pressure

Scape-goating

Recognition

Morale

Fairness

Equitable Rewards

Innovation

Resistance to change

The dimensions are very similar and the totalities of the seven dimensions are indeed quite
alike. Trust appears in both measures as well as fairness and equity. Recognition is one means to
achieve morale. Cohesion and conflict are opposites. Innovation can be thought of as the opposite
of resistance to change; at least, low resistance to change can be a precursor to innovation.
Similarly, autonomy can lead to credibility in the organization. Finally, one can imagine that high
pressure in the organization could lead to scape-goating. The match is not perfect, but clearly
related and informally we can say that the totality of the measures is similar. Zammuto and
Krackover (1991) mapped their seven dimensions of climate into the competing values framework
and in that way created four different climate types which they labeled:

(a)

The Group Climate.

(b)

The Developmental Climate.

(c)

The Rational Goal Climate.

(d)

The Internal Process Climate.

The four corresponding climate types are characterized from the point of view of the
competing values: The group climate could be described as a friendly place to work where people

20

Michael Cameron Gordon Davidson (2002). Organisational climate and its influence upon performance: A
study of Australian hotels in South East Queensland .

13

share a lot of themselves. It is like an extended family. The leaders, or head of the organization, are
considered to be mentors and, perhaps even parent figures. The organization is held together by
loyalty or tradition. Commitment is high. The organization emphasizes the long-term benefits of
human resource development with high cohesion and morale being important.

Success is defined in terms of sensitivity to customers and concern for people. The
organization places a premium on teamwork, participation, and consensus. The developmental
climate could be described as a dynamic, entrepreneurial and creative place to work. People stick
their necks out and take risks. The leaders are considered to be innovators and risk takers. The glue
that holds organizations together is commitment to experimentation and innovation. The emphasis
is on being on the leading edge. Readiness for change and meeting new challenges are important.
The organization's long-term emphasis is on growth and acquiring new resources. Success means
having unique and new products or services and being a product or service leader is important. The
organization encourages individual initiative and freedom. The rational goal climate could be
described as a results-oriented organization. The leaders are hard drivers, producers, and
competitors. They are tough and demanding. The glue that holds the organization together is the
emphasis on winning. The long-term concern is on competitive actions and achievement of
measurable goals and targets. Success is defined in terms of market share and penetration.
Competitive pricing and market leadership are important. The organizational style is hard driving
competitiveness.

The internal process climate is a formalized and structured place to work. Procedures
govern what people do. The leaders pride themselves on being coordinators and organizers.
Maintaining a smooth running organization is important. The long term concerns are stability,
predictability, and efficiency. Formal rules and policies hold the organization together. The
organizational climate can then be measured using these seven variables and further the climate can
be categorized into the four types using the competing values framework.

The identification of dimensions was also the subject of a study by Campbell, Dunnette,
Lawler, and Weick, when they reviewed the work of Litwin and Stringer (1966), Schneider and
Bartlett (1968), Taguiri (1966), and Kahn, Wolfe, Quinn, Snoek, and Rosenthal (1964). Campbell
et al. found four factors common to each of these studies21:
21

Campbell, J., Dunette, M.D., Lawler, E.E., & Weick, K.E. (1970). Managerial behavior, performance, and
effectiveness. New York: McGraw-Hill.

14

(a)

Individual autonomy,

(b)

Degree of structure imposed on the position,

(c)

Reward orientation, and

(d)

Consideration, warmth and support.

Whilst there is no definitive agreement on climate dimensions there does appear to be some
commonality of organisational dimensions that can be measured by a number of theorists and the
debate continues over the narrowness of range used to describe different work environments
(Pritchard and Karasick, 1973; James and James, 1989; James, James and Ashe, 1990; Schneider,
1975).Ryder and Southey (1990) applied an exploratory PCA to the data they gathered from their
Australian sample using their modified version of the Jones and James

22

instrument. This

procedure resulted in a 10 factor solution (using the criterion of the corresponding eigenvalue being
greater than unity). The authors report that of those 10 factors, only 6 were interpretable. The
dimensions they so identified were:-

(a)

Leader Facilitation and Support, with the leader providing support and facilitating

the accomplishment of work goals, facilitating interpersonal relationships, being aware of

employee needs and providing job feedback. It also encompasses openness of expression
and allows for upward interaction.
(b)

Job Variety, Challenge and Esprit, deals with not only job variety, challenge and

autonomy but professional, work group and organisational esprit de corps. It also
encompasses opportunities for growth and advancement, role ambiguity and efficiency of
job design.
(c)

Conflict and Pressure, deals with conflict in a role and between organisational

goals and objectives, job pressure, planning and co-ordination, and opportunities to deal
with others.
(d)

Organisational Planning Openness, describes planning and effectiveness, and

ambiguity of organisational structure. It also deals with job standards and importance, the
consistent application of organisational policies, and confidence and trust down.
(e)

Workgroup Reputation, Co-operation, Friendliness and Warmth, encompasses

precisely the concepts named in its title.

22

Jones, A.P. & James, L.R. (1979). Psychological climate: Dimensions and relationships of individual and
aggregated work environment perceptions. OrganizationalBehaviour and Human Performance, 23, 201 250.

15

(f)

Perceived Equity, looks at interdepartmental co-operation, organisational

communication down, and the fairness and objectiveness of the reward process.

Ryder and Southey noted that the major dimensions of psychological climate are stable and
would provide a framework for future research. In their study they modified the Jones and James
(1979) questionnaire and reported improved measures of reliabilities. The psychological climate
refers to the beliefs and attitudes held by individuals about their organization. The climate is an
enduring quality of an organization that (1) is experienced by employees, and (2) influences their
behavior. It should be thought of and measured at the organizational level of analysis. 23. Climate
is an organizational characteristicnot a characteristic of each individual in an organization.
However, we do look to individuals as the source of information on the climate. It is their
perception about the organization that we measure.

23

Glick, W.H. (1985). Conceptualizing and measuring organizational and psychological climate: Pitfalls of
multilevel research. Academy of Management Review, 10 (3), pp 601-616.

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Conclusion
Study has concluded that there is a consistent correlation between human resource dimensions of
organisational climate and customer perceptions of employee morale, branch administration and
most significantly overall quality. It is evident that the implications of these findings are; Customer
perceptions, attitudes and intentions seem to be affected by what the employees experience, both
in their specific role as service employees and in their more general role as organizational
employees. That is, organisational practices (both service related and human resource related) are
apparently the source of cues visible to customers and are used by them to evaluate service quality.
Since, services themselves yield little tangible evidence as a useful basis for evaluation, it is how
they are delivered, and the context in which they are delivered that is important. Hence, building
and creating organisational climate is primary to an organisations development and productivity.

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