Organizational Culture in the Restaurant Industry: Implications for Change

Abstract

INTRODUCTION Employee perspective with regard to organizations has been shown to have effects on success of organizations. Having employees with appropriate attitudes will enhance probability for success in any company in any industry (Davidson, 2003). Organizations with a strong sense of customer orientation have also shown greater levels of customer satisfaction (Schneider & Bowen, 1993). The restaurant industry has a greater likelihood of being influenced by employee actions than other industries, because of its labor-intensive nature and high level of interaction between employees and customers (Davidson, 2003; Seidman, 2001). The purpose of paper was to research findings in existing literature for suggesting directions restaurant leaders could follow with regard to cultural development. Their implementation could have a significant impact on many aspects of their operations, including increasing productivity, reducing turnover and building commitment. For transformational change to be achieved, organizations must first understand and manage complexities of their respective organizational cultures (Goodman, Zammuto, & Gifford, 2001) and build stronger levels of organizational commitment. The manuscript reports findings of a study to determine how organizational culture influences full-service restaurants. The purpose of study was to determine most suitable cultural model for full-service restaurants among four presented. Restaurant Industry Challenges Although individual restaurant entities are usually considered small businesses, restaurant industry has been traditionally known for having a highly bureaucratic management style (Tracey & Hinkin, 1994). Classical management styles are that of highly defined, routine practices, which have strict adherence to specific rules and regulations (Smucker, 2001). The traditional management philosophy (i.e., Theory X management) in hospitality industry does not take into effect person or individual doing job, but focuses more on job itself. Identifying what specific tasks and requirements of job are and then training employees to perform these duties has been and remains norm in food and beverage industry (Tracey & Hinkin, 1994). Generally, restaurant industry is almost autocratic in nature. It is hence a difficult and demanding industry within which to be employed. Theory X management style works when there is little competition and local unemployment figures are high. The realities of industry depict a different story. Industry statistics show that competition among operators is fierce and that a lack of a large labor pool has plagued industry for a long time, which continues to be a major concern for restaurant owners and managers (Crook, Ketchen, & Snow, 2003; Enz, 2004). Ultimately, harsh organizational climates tend to discourage employees from continuing employment with foodservice operators and cause people to job-hop. The restaurant industry is notorious for having high employee turnover rates. An industry-wide study of restaurants concluded that restaurant managers should do a better job of being an employer of choice if they are to satisfy customers and produce financial results (Koys, 2006). ORGANIZATIONAL CLIMATE AND ORGANIZATIONAL CULTURE DEFINED Before Pettigrew's (1979) landmark organizational culture study, research centered on construct of organizational climate (Obenchain, 2002). Organizational climate emphasizes importance of shared perceptions as underpinning notion of climate (Anderson & West, 1998; Mathisen & Einarsen 2004). Reichers and Schneider (1990) defined organizational climate as the shared perception of way things are around here (p. 22). According to Schein (1990), main differences between organizational climate and organizational culture are levels of complexity of two constructs. …

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