THE EFFECT OF ORGANIZATIONAL CULTURE ON ORGANIZATIONAL EFFECTIVENESS: THE CASE OF COMMERCIAL BANK OF ETHIOPIA

Abstract

Even though there is an assumption that organizational culture is one variable which can affect an organization’s function but there are few studies explicitly discuss the effect it has on organizational effectiveness. The main purpose of this study was to examine four traits of organizational culture; involvement, consistency, adaptability and mission and how they affect organizational effectiveness More than the other dimensions, Consistency has the highest impact on organizational effectiveness. i.e. Consistency has 37.8% of contribution on Organizational Effectiveness of in the case of Commercial Bank of Ethiopia (CBE). For the study the researcher deployed explanatory research design and non probability convenience sampling method. The data had been gathered through structured questionnaire from 125 current employees of CBE and an in-depth interview with managers in CBE. The collected data were analyzed using statistical package for social science (SPSS) version 20. Descriptive statistics/frequency distribution and tables were used. This study takes place through two methods; the qualitative provided an explanatory analysis of management perception on the overall effect of organizational culture on CBE’s organizational effectiveness. And the quantitative study results show the predictive value of on the four indicators of organizational effectiveness of CBE especially on employee satisfaction and organizational commitment. The research also shows that if employees are committed and share the same norms and values as per the organization, it could increase the effectiveness towards achieving the organizational goals. The study suggested that an emphasis should be given on CBE’s involvement, adaptability and consistency practices in order to enhance the effectiveness of employees’ satisfaction and commitment and customers’ satisfaction.