This appendix provides information on the foundations and development of the proposed Australian Public Service (APS) Performance Culture Model, referred to in Chapter 5. This includes exploring what organisational culture is, as well as detailing the process the Australian Public Service Commission (the Commission) followed to create the model and the scales used to measure it.
What is organisational culture?
Organisational culture is an ubiquitous element of organisational life, providing the context in which employees work. While a single, consistent definition of organisational culture has not emerged despite prolonged interest1, one commonly used definition is:
… a pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.2
More colloquially, organisational culture represents ‘the way things are done around here.’ Crucially, organisational culture varies between organisations, being influenced by leadership, organisational function and the age of the organisation.3
Why measure organisational culture?
All organisations have a distinct culture which impacts on employees. Studying the dynamics of an organisation only through employee attitudes and engagement arguably misses the larger picture. While normal employee surveys speak only about the workforce, they overlook the context in which the workforce operates and how this shapes behaviour and attitudes.4 They also overlook how leaders and employees shape the workplace by influencing the culture. Including organisational culture in the APS Employee Census (employee census) provides a more complete view of the workplace and the state of the APS.
Organisational culture has also been shown to have direct and indirect links to organisational effectiveness.5 This has been explained by:
- cultural strength—strong, internally consistent cultures create consensus among the workforce and foster conformity through shared values6
- cultural balance—having strengths across a range of cultural dimensions allows the organisation to operate successfully in a variety of challenging circumstances, whereas too narrow a focus can lead to weaknesses7
- influencing employee attitudes—as the context in which employees work, the culture can impact on a wide variety of employee attitudes including job satisfaction.8
Assessing organisational culture
As well as competing definitions, the literature contains competing models of culture. Selecting a model is critical as it provides the lens through which culture is viewed as well as how it is measured. Any model must also be backed up by a robust and reliable measure of organisational culture that aligns with the model on which it is based.
The APS Performance Culture Model
The APS Performance Culture Model was based on the widely used Competing Values Framework9 (CVF) for three reasons. Firstly, since its creation, the CVF has become one of the most widely used models of organisational culture.10 It has been used in both academic and applied research in a variety of organisations both within Australia11 and internationally.12 Secondly, the model is simple enough for results to be clearly communicated to a non-expert audience. Finally, CVF measures are relatively short making them easier to include in the employee census.
The APS Performance Culture Model characterises organisational culture by how the organisation responds to two sets of competing demands:
- the need to have stability versus the need to adapt to changing circumstances
- the need to manage internal agency factors versus monitoring the external business environment.
How agencies meet these competing demands creates four distinct quadrants of culture that agencies may emphasise to a greater or a lesser extent.
Figure A4.1. The APS Performance Culture Model
Source: The Commission
As Figure A4.1 shows, agencies may emphasise:
- Task—managers, employees and leaders focus on delivering outcomes to stakeholders. This is linked to the rational allocation of resources to tasks to ensure that goals are achieved.
- Innovation—managers, employees and leaders focus on developing and implementing new solutions. This is characterised by a high level of flexibility and a focus on future needs.
- Process—managers, employees and leaders focus on following established procedures. This ensures quality and accuracy are maintained.
- People—managers, employees and leaders focus on building cohesive teams and managing employee wellbeing. The emphasis on empowerment allows employees to act with flexibility and discretion.
Understanding organisational culture
While the APS Performance Culture Model identifies four quadrants that agencies may emphasise, these are not mutually exclusive. Organisations may emphasise two or more relatively equally. Alternatively, organisations may emphasise none, although this may be linked to poor outcomes.13
Furthermore, the APS Performance Culture Model describes organisational culture; it does not evaluate it. There is no ‘right’ culture, and higher scores do not indicate a superior agency. Different organisations have different cultures, in the same way people have different personalities. Understanding an agency's culture helps leaders and employees understand how the workplace operates. It does not indicate whether the culture or the agency is good or bad, although leaders may be able to use their knowledge of the agency context to consider whether the culture aligns with operational requirements.
Finally, due to the scope and complexity of organisational culture, it is difficult to gain a comprehensive view with a survey. The CVF examines a small number of foci that are applicable across the APS, but it cannot address the wider range of values, assumptions and social norms which fall outside this, but which are also part of the culture.
Organisational culture results
Figures A4.2 and A4.3 map the culture profiles of six agencies of varying sizes and functions. Most agencies place significantly different emphases on each quadrant of the model, although agency 2 shows a flatter profile. Using agency 1 as an example, the agency culture places a significantly higher emphasis on the Task quadrant than any other. This is followed by People and Process. Innovation is emphasised to a significantly lower degree than the other quadrants. Profiles vary from agency to agency, giving each a relatively unique profile, although the Task focus is the most heavily emphasised across all agencies.
Figure A4.2. Cultural profiles of APS agencies, 2014
Source: Employee census
There are also differences in the extent to which agencies emphasise a given quadrant. For example, agency 1 places a significantly higher emphasis on looking after employees (the People quadrant) than the other example agencies. While agency 1 placed a lower emphasis on Innovation than the other quadrants, it was still emphasised more strongly than in most other agencies. Conversely, agency 1 culture placed a lower emphasis on Process than agencies 3, 4, 5 and 6. Task performance, however, was emphasised more strongly in agency 1 than in the other agencies.
Figure A4.3. Comparison of cultural focus of APS agencies, 2014
Source: Employee census
In summary, agency 1 culture emphasises achieving goals more strongly than following procedure. This makes the agency relatively distinct from most other agencies. The culture also places a greater emphasis on building teams and looking after employee wellbeing than the other agencies examined. Finally, while agency 1 emphasises Innovation to a lesser extent than any other focus, it is comparable to agency 2 and higher than the other agencies.
While the relatively strong emphasis placed on all four quadrants suggests agency 1 has a balanced culture, which should allow it to respond to challenges that require different types of responses with reasonable expectations of success, it does not by itself evaluate whether the culture is ‘good’ or ‘bad’. Furthermore, this picture does not include all the similarities and differences which exist in the culture of these agencies. Issues such as a shared commitment to the APS Values and a commitment to professional public service are also elements of organisational culture, however, they are implicit in the APS Performance Culture Model rather than explicitly measured. Conversely, other subtle nuances may fall outside the model, but still contribute to what gives an agency its distinct culture.
Developing the APS Performance Culture Model
Development of the APS Performance Culture Model commenced in 2013, when a measure based on the Competing Values Framework was taken from the research literature14 and included in the 2013 employee census. The 2013 employee census was completed by 102,219 APS employees, a response rate of 66%.
Integrating organisational culture into the 2013 APS employee census
While this scale had been independently reviewed in the literature and found to be robust15, it was modified before being included in the employee census. This made it necessary to thoroughly review the scale's performance using APS data. Essentially, the Commission needed to verify that the items included in the scale aligned correctly with the CVF model, and that the scale showed adequate reliability in the public sector context.
Exploratory factor analysis showed that the items included in the scale and tested in the 2013 employee census failed to align with the CVF model. Given the model was not supported by the data, scores could not be interpreted according to the underlying CVF theory. Without a clear interpretation of what the scale was measuring, results could not be used to inform agencies and leaders. As such, this material was not used in the State of the Service Report 2012–13. Work continued in 2013–14 to develop a new measure of organisational culture tailored to the APS context.
The CVF was retained as the basis for a new model of APS performance culture, as it remains a theoretically valid, widely-used and easy-to-communicate model which could be applied across the APS. The outcome (or lack therefore) from the 2013 employee census, however, demonstrated that it needed to be tailored specifically to the APS context. The clearest problem lay with what—in the CVF— had generally been termed 'market culture'.16
According to the standard CVF, a market culture combines an external focus on the actions of competitors with high flexibility as the organisational rationally allocates resources to compete. For private sector companies, managing these challenges is vital for survival. APS agencies deliver services to the public, monitor the business or global environment in order to provide advice to stakeholders, or regulate industries. These functions also demand a strong, external focus, but for different reasons. Given the drive for efficiency and downsizing in the public sector, which has characterised both Australian and international public sectors17 in recent years, APS agencies must also focus on the rational allocation of resources for the completion of tasks. As such, while APS agencies may have outward-facing, task-focused cultures, the standard CVF definition of market culture is not appropriate. By modifying this quadrant, ensuring that it and others align with the APS context, the CVF was used to create the APS Performance Culture Model. After finalising the model, it was necessary to create four robust and reliable scales to measure each of the culture quadrants.
Creating the APS culture scales
Creating the scales to measure APS organisational performance culture proceeded in stages, including:
- review of other culture measures in the literature to identify useful concepts and items
- development of items measuring Task, Innovation, Process and People focus
- review of items by subject matter experts
- focus group testing of items among Commission employees.
Thorough review of potential items was necessary to ensure the language in the culture scales was clear, the concepts were understandable and that people could characterise their agency in these terms. Feedback was used to improve the scales and select items for pilot testing.
The culture scales were pilot tested in one of the Commission's regular Pulse surveys. Overall, 138 employees completed the items. Exploratory factor analysis was used to ensure that items aligned with the APS Performance Culture Model. Scale reliability was also examined. Results were positive, although the scales were shortened for inclusion in the 2014 employee census.
Results from the 2014 employee census
Before the APS Performance Culture Model was used in the State of the Service report, confirmatory factor analysis was used to ensure the culture scales were robust and reliable in a range of APS agencies of varying size and function. The scales performed as expected in all six agencies used. Items included in the culture scales are shown in Table A4.1. Three items were found not to be contributing factors during confirmatory analysis and, as such, were not used to calculate the scale scores plotted in figures A4.2 and A4.3. These items are marked with an asterisk (*).
|In my opinion, my agency emphasises:||In my opinion, my agency prioritises:||In my opinion, the employees who get ahead in my agency are:||In my opinion, most managers in my agency are people who:|
|Source: Employee census|
|Task||Delivery—Completing tasks is important*||Achieving goals—Work must be completed to a high standard||Task focused||Ensure their team delivers|
|Innovation||Innovation—Finding new solutions to problems is important||Developing new ideas—Employees are encouraged to make suggestions||Able to generate new ideas||Encourage innovation|
|Process||Procedure—Delivering standardised services is important*||Process—Employees are expected to follow established procedures||Process orientated||Make sure procedure is rigorously followed|
|People||Employees—The wellbeing of our people is important||People—Team cohesion is important||Supportive of others*||Value their employees|
The Commission has developed a model of organisational culture based on theory and literature. Effective measures have also been developed to measure organisational culture based on this model. Where others have performed poorly in the APS context, these scales have proven to be robust and reliable in a range of different agencies. The APS Performance Culture Model provides a new way of viewing workplace characteristics which are likely to influence employee engagement, as well providing a new way of viewing how the behaviours of leaders and employees at all levels shape the workplace.
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