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This research paper examines the concept of organizational climate and its metaphorical derivation. It begins by defining what is meant by the construct and the specific conceptual challenges that researchers face in trying to agree upon a single definition. Different statistical functions of organizational climate scores which have recently emerged in the literature are outlined using examples from relevant research findings. Empirical research into global and facet-specific organizational climate is then described. Given the plethora of facet-specific climate studies which have emerged in the literature over the past decade, the research paper concludes with a call for a more unified theoretical and methodological approach when conducting future research on organizational climate.
- Defining Organizational Climate
- The Competing Values Model
- Measuring Organizational Climate
- Research on Antecedents and Outcomes
Defining Organizational Climate
For many years, management scholars have grappled with the challenge of understanding how organizational context impacts and shapes the attitudes and behavior of organizational members. Much of this endeavor has centered on the construct of organizational climate. Climate has been variously described as “the way things are around here” (Schneider, 1990) to “a molar concept reflecting the content and strengths of the prevalent norms, attitudes, behaviors, and feelings of the members of the social system which can be operationally measured through the perceptions of system members, or observational means” (Payne, 1990: p. 156). The Oxford English Dictionary defines meteorological climate as “the prevailing atmospheric phenomena and conditions of temperature, humidity, wind, etc., of a country or region.” When applied to communities, climate is “the mental, moral, etc., environment prevailing in a body of people in respect of opinion, some aspect of life, etc.” Thus, just as we describe climates in terms of sunshine, prevailing winds, levels of rainfall, etc., organizations are described in terms of dimensions such as leadership style (autocratic versus democratic), concern with the well-being of employees, emphasis on productivity, formalization or bureaucracy, innovation versus traditionalism, and commitment to quality in service or production.
Although there is a general consensus around what organizational climate means, trying to agree upon a specific definition in the literature remains a challenging task, once described as like trying to “nail Jell-O to the wall” (Schneider, 1990: p. 1). Questions which create difficulties for researchers include: Are climate phenomenon perceptual in nature, or do their capture objective attributes of an organization? How does the concept organizational climate differ from organization culture? And at which level of analysis should organization climate be measured? This has led copious climate definitions in the literature. However, for the purposes of this research paper, we adopt the widely accepted conceptualization proposed by Schneider and Reichers (1983), which defines organization climate as a set of shared perceptions about the practices, procedures, and policies that an organization expects, supports, and rewards. Organizational climate captures the aggregation of individual psychological meanings of their work environment and is therefore a collective perceptual phenomenon (Kuenzi and Schminke, 2009). Research on organizational climate explores how individual perceptions regarding their workplace impact both individual outcomes (such as job satisfaction, individual performance, and organizational citizenship behavior (OCB)) both group and organizational outcomes (such as team performance and customer satisfaction). As shall be examined later in this research paper, empirical studies are therefore increasingly conducted at multiple levels of analysis to understand more about how individuals, groups, and organizations interact.
Another continuing debate in the literature concerns the demarcation of organizational climate from organizational culture. Schneider and Reichers’s (1983) definition establishes that climate, although related, is distinct from culture. Indeed, both of these concepts are root metaphors, which are very different in orientation. Organizational culture is taken to refer to the underlying patterns of interpretations of formal practices, such as pay levels, hierarchy, and job descriptions, and informal practices such as norms, espoused values, rituals, organizational stories, jargon, humor, and physical environment. Conversely, researchers generally agree that climate is a measure of the surface manifestations of culture and is not entirely distinct from culture. Most argue that culture, due to its deep and often hidden embeddedness in organizations, can only be measured by qualitative methodologies, whereas climate as a more superficial characteristic of organizations can be assessed using quantitative questionnaire measures. Furthermore, whereas culture researchers are concerned with the manifestation of underlying assumptions which create shared values, climate researchers are more interested in the ways in which organizational members attend to these shared values (Kuenzi and Schminke, 2009). However, others would argue that these distinctions are largely artificial and it is true that both concepts of climate and culture are the subject of continuing debate because of their lack of theoretical and conceptual underpinnings.
In defining the construct of organizational climate, it is also important to distinguish between global climate and facet-specific climate. Indeed, over the years, there has been much uncertainty and debate about whether climate should be conceived of as a multidimensional concept or a unitary concept. Initially, climate researchers focused on establishing a global conceptualization of organizational climate which could account for the total influence of situational variables in organizations, and how these impact individual attitudes and behavior. For example, Campbell et al. (1970) argued for a small number of common dimensions that constitute climate, including individual autonomy at work, the degree of structure imposed upon people’s work roles, reward orientation (positive or negative), and warmth and support. Similarly, Jones and James (1979) proposed four dimensions of climate perceptions: job challenge and autonomy; role stress and lack of harmony; leadership facilitation and support; and work-group cooperation, friendliness, and warmth. However, the focus on climate as a global phenomenon has been riddled with conceptual and methodological problems. First, given the abundance of global climate definitions in the literature, researchers have been unable to reach a consensus on a single definition, leading to conceptual imprecision and ambiguity surrounding measurement. Existing research focused on global climate has also been criticized for lacking rigorous theoretical rationale.
These conceptual and methodological challenges have fueled a growing interest in facet-specific organizational climates over the past decade. For example, Clarke (2006) looked at a climate for safety, Anderson and West (1998) at a climate for innovation, and Martin and Cullen (2006) at a climate for ethics. Indeed, Schneider and Reichers (1983) initially suggested that work settings actually have many climates and argued for the study of facet-specific climates rather than global organizational climate. To this way of thinking, the choice of climate dimensions should be closely linked to the criteria of interests or climates ‘for something.’ This should reflect the specific strategic outcomes of the organization at hand, for example, a climate for justice, ethics, diversity, innovation, customer service, or safety. Because these each represent distinct aspects of an organizational environment, facet-specific climates can be seen as independent and may therefore be present simultaneously at any given time in an organization.
Although facet-specific climate research has helped to develop our understanding about how work climates impact individual and organizational performances, this approach has also led to substantial fragmentation in the field, with research on particular facets becoming splintered and published under different topical areas. Some suggest that this has led to poor integration and unification of the most recent research on organizational climate (Kuenzi and Schminke, 2009). Others also continue to argue that organizational climate is most usefully applied as a multidimensional construct and that some dimensions are generic and applicable to most organizations. Of course, there will be some which are unique or at least applicable to only a small range of organizations (e.g., climates for secrecy in the defense industry or for caring in health care organizations). One orientation to the mapping of climate that has proved powerful is the competing values model of organizations (Quinn and Rohrbaugh, 1981), which distinguishes among human relations, rational goal, open systems, and internal process constellations of organizational values.
The Competing Values Model
The competing values approach incorporates a range of fundamental dimensions of values into a single model. It calls attention to how opposing values exist in organizations and how organizations have different mixtures of values that influence their goals and how they go about achieving those goals. These values will most fundamentally manifest themselves in whether the organizational orientation varies more toward flexibility or control, and whether the focus of the organization varies more toward the external or internal environment. A major theoretical strength of this model is its derivation from four orientations to the study of organizational effectiveness reflecting long traditions in work and organizational psychology. Thus the rational goal approach (external focus, but with tight control within the organization) reflects a rational economic model of organizational functioning, in which the emphasis is upon productivity and goal achievement. The open systems model (external focus and flexible relationships with the environment) emphasizes the interaction and adaptation of the organization in its environment, with managers seeking resources and innovating in response to environmental (or market) demands. The internal process approach reflects a Tayloristic concern with formalization and internal control of the system in order that resources are efficiently used. Finally, the human relations approach reflects the tradition derived from sociotechnical theory, emphasizing the well-being, growth, and commitment of the community of workers within the organization. By combining these orientations into one model, Quinn and Rohrbaugh aimed to provide a broad conceptual map of the domains of organizational theory over the twentieth century. Such a map is useful in identifying the required topography of a climate measure applicable to a wide range of organizations. The model is also useful in reflecting the means for implementing those values in terms of managerial practices and the ends or outcomes which are emphasized or which compete in each domain. The model does not propose that organizations will locate predominantly in one quadrant, but, reflecting the rich mix of competing views and perspectives in organizations, proposes that organizations will be active and give emphasis to each domain but with differing strengths.
Measuring Organizational Climate
Having established what we mean by ‘organizational climate,’ in this section, we shall explore the different statistical functions of organizational climate scores. Indeed, research on organizational climate continues to be hampered by a particular methodological debate. It concerns the practice of aggregating individual employees’ scores on climate dimensions and taking the mean as a representation of organizational climate. This has been referred to as a composition theory for climate (James et al., 2008) which proposes that the aggregation of individual climate perceptions (i.e., psychological climate) provides a powerful measure of organizational climate. Given that organizational climate is a collective phenomenon representing shared psychological meanings, statistical aggregation to this higher level construct requires perceptual agreement between individual climate scores. Therefore, the validity of aggregate climate used to describe organizations depends upon the demonstration of agreement between individual members and their perceptions. In such circumstances, the use of aggregated individual data to measure organizational climate is appropriate.
Nevertheless, the main methodological problem with this approach, a demonstration of shared conceptions for aggregate climates, has provoked much debate in the research literature. Indeed, writers have not specified what is an appropriate level of agreement. Some suggest that dichotomous questionnaire items should be used to measure climate and that the only items to be treated as descriptive of organizational climate should be those in which the frequency of endorsement is not significantly different from 0 to 100%. Others have suggested that 66% was reasonable, but few researchers have followed either prescription. The validity of aggregating climate perceptions to the organizational level is further called into question by the demonstration that there are significant differences between members of different organizational subgroups in their perceptions of climate. Such differences have been found between groups within the same organization, based on factors such as hierarchical level, departments, divisions, regions, and work groups.
One approach to overcoming the aggregation issue is to examine the level of inter-rater agreement between individuals within an organization, in relation to their perceptions of climate. A common way of achieving this is through the use of intraclass correlation coefficients. Such coefficients are based on a one-way analysis of variance and assesses the ratio of variation within organizations to variation among organizations. However, this coefficient has been criticized as inadequate which led to the development of the Rwg(j) index of multiple item scales developed by James et al. (1993). This is a technique for assessing agreement among the judgments made on multiple item scales. Another salient approach is the average deviation (AD) index (Burke et al., 1999). Although there is continuing debate about the advantages and disadvantages of such orientations, these measures for justifying aggregation continue to be widely used. Indeed, it remains likely that organizational climate measures will continue to be used, despite there being no simple or widely agreed criteria for aggregation. Part of the problem is that the level of agreement within organizations will depend partly on the measures employed, the context, and the domains tapped by the measures. However, simply using the mean may mask profound differences between organizations and the variation of responses given by employees. Indeed, research within organizations has shown clear differences between hierarchical levels and departments in ratings of climate, suggesting a number of subclimates within each organization. Overall, when the level of analysis changes from the individual to the organization, the validity of the data is uncertain.
More recently, researchers have begun to explore new relationships between organizational climate and its antecedents and outcomes by using alterative statistical functions of climate scores. For example, Schneider et al. (2002) proposed the related construct of ‘climate strength’ which captures within-group variability of perceptions of organizational climate. The researchers found that climate strength moderated the relationship between managerial practices (one of four dimensions of climate) and customer experience. In another study of 197 work units, Gonzalez-Romá et al. (2002) also examined the moderating influence of three climate strength facets (support, goals orientation, and innovation).
Alternatively, in a study of emergency planning committees, Lindell and Brandt (2000) used the constructs of ‘climate quality’ (mean climate perceptions) and ‘climate consensus’ (level of perceptual agreement on climate) as mediating variables in their analysis. Their results showed that in comparison to climate consensus, climate quality was more strongly related to both antecedent and outcomes variables. More recent research is therefore moving beyond the composition theory for climate, exploring the influence of more sophisticated statistical functions of climate scores.
Research on Antecedents and Outcomes
So what has research told us to date about the importance of organizational climate in predicting individual, group, and organizational outcomes? What factors influence the development of organizational climate in organizations? In this section, we shall begin by summarizing research evidence on the consequences of organizational climate for organizations and their members, before considering several important antecedents.
One of the earliest uses of the concept of climate was in research conducted by Lewin et al. (1939), who examined the effect of the leadership style of boys upon their work groups. Leadership style was categorized as autocratic, democratic, or laissez-faire and the work-group climates were described, respectively, as hostile, unproductive, and unenjoyable; busy, cooperative, productive, and enjoyable; and anarchic, unproductive, not cohesive, and unsatisfying. More recent research has concentrated on climate at work group, department, or organizational levels. As had been discussed, these supraindividual climates have been operationally constructed by aggregating individual perceptions of psychological climate to the appropriate level and using the mean to represent the climate at that level of aggregation. These organizational climate measures are now widely used in public and private sector organizations to determine the prevailing climate, often being called employee attitude surveys or employee opinion surveys.
One of the reasons why organizational climate surveys have become so widely used is that climate has been shown to predict organizational productivity and profitability, customer attitudes, innovation, team performance, OCBs, safety, and job attitudes. For example, Patterson et al. (1997) found that an organizational climate oriented toward good human relations predicted 29% of the variation between companies in productivity and profitability in the UK manufacturing sector. In a study of 137 clusters of bank branches, Gelade and Ivery (2003) also found that global organizational climate was positively related with sales against targets, clerical accuracy, customer satisfaction, staff retention, and overall performance. Furthermore, Glisson and James (2002) found that positive climates predicted more favorable work attitudes in a study of 238 managers. This study also found evidence that organizational climate is distinct from culture. Overall, because of these strong associations between climate and performance, both researchers and practitioners remain intensely interested in the construct (Kuenzi and Schminke, 2009).
There has also been an increasing amount of empirical attention paid to facet-specific climates over the past decade. For example, Hofmann et al. (2003) explored the moderating effect of safety climate on the association between leadership (specifically leader–member exchange (LMX) and safety citizenship roles. Using multilevel analysis, group-level safety climate was found to moderate the LMX–safety citizenship roles relationship. In another facet-specific study, King et al. (2007) analyzed data from over 22 000 members of 131 health care organizations in the United Kingdom and found that climate for innovation was positively related to organizational performance and also moderated the relationship between work demands and organizational performance. Furthermore, Chen et al. (2007) adopted a group-level approach to explore the effects of team empowerment climate on an individual’s sense of empowerment, whereas Maynard et al. (2007) collected data from 637 customer service engineers to examine how resistance to empowerment climate was related to team performance and customer satisfaction. These are just a few of many published studies which have examined outcomes of facet-specific climates over recent years.
But where do climates come from? What influences their emergence and development? Researchers have now started to pay more attention to the individual-, group-, and organization- level predictors of climate, mainly through quantitative cross-sectional field studies. However, relative to the amount of research examining the consequences of global and facet-specific climates, far fewer studies have so far examined climate antecedents. One antecedent that has received the most interest is that of leadership. For example, transformational leadership was shown to be a significant antecedent of climate for involvement in a study by Richardson and Vandenberg (2005). Similarly, in a study of over 2000 military soldiers, Zohar and Luria (2004) found transformational leadership to positively predict safety climate. In another leadership study, Ehrhart (2004) found that servant leadership was positively related to procedural justice climate, which itself was a mediator between servant leadership and OCB. Leader personality characteristics have also been explored as antecedents of facet-specific climate. In a study of 3445 employees in 383 US department stores, Mayer et al. (2007) found that leader agreeableness and conscientiousness were positively related to procedural justice climate, whereas neuroticism was negatively related, and extraversion unrelated. Finally, in a study of 212 bank employees, Walumbwa et al. (2008) found that contingent reward transactional leadership positively predicted procedural justice climate and procedural justice climate strength, which in turn, were related to satisfaction with supervisor, OCB, and organizational commitment. Research to date therefore suggests that leadership is a key mechanism through which organizational climate can be developed and nurtured to have a positive impact on outcomes.
However, an increasing amount of research has also looked beyond leadership to consider other important antecedents of facet-specific climates. In keeping with the theme of procedural justice, Tangirala and Ramanujam (2008) found that employee silence was a negative antecedent of procedural justice climate, which itself moderated the relationship between employee silence and work group identification, as well as professional commitment. Naumann and Bennett (2000) examined whether demographic similarity, group cohesion, and supervisor viability were antecedents of climate strength in a study of 323 bank employees. They found that procedural justice climate was indeed related to cohesion and supervisor viability, but not to demographic similarity, suggesting that shared climates can emerge even in highly diverse organizations. Finally, Pirola-Merlo et al. (2002) conducted research with 53 research and development teams and found that obstacles had a negative impact on team climate, which in turn, was positively related to team performance. Furthermore, team climate mediated the relationship between leadership and team performance. This is by no means an exhaustive list of research on climate antecedents, but serves to demonstrate the growing level of interest and diversity in the type of research currently being conducted in the field. We anticipate that this will only continue to grow as organizations are required to do more and more with less and less, and therefore require further understanding about how exactly contextual factors impact and shape the working lives of organizational members.
Theory and research on the phenomenon of organizational climate is continuing to develop and gain momentum in the organizational sciences. In a recent qualitative review, Kuenzi and Schminke (2009) identified 241 published empirical studies in the area. Indeed, because organizational climate is a phenomenon that researchers experience in practice, in working in different organizations, and because the measures of organizational climate relate to important outcome measures, it is likely that the concept will continue to be used. Progress has been made on how to best capture and operationalize the climate construct. However, the increasing focus on facet-specific climates means that the literature has become splintered and somewhat fuzzy in recent years. Future research endeavor must therefore be designed and conducted through a more unified theoretical and methodological lens to enable organizational climate scholars to better synthesize their research findings and move the field forward in a coherent and coalesced way.
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