What is Organizational Climate?

Would you like to find out about organizational climate? This analogy will give you an overall picture of organizational climate. When a hurricane batters Louisiana, for example, is it just a weather event or is it a happening in the overall experience of climate change? The two are interconnected but also different. Weather happens in a particular moment while the climate is a much broader overview of the weather that is experienced over time.

Likewise, businesses and organizations have an organizational climate. This is similar to organizational culture, but more of an aggregate of all aspects of the employees’ experience of their work environment. Dr. Lawrence R. James and his colleagues defined climate as follows.

“Psychological climate is defined as the individual employee’s perception of the psychological impact of the work environment on his or her own well-being (James & James, 1989). When employees in a particular work unit agree on their perceptions of the impact of their work environment, their shared perceptions can be aggregated to describe their organizational climate.” (Jones & James, 1979; Joyce & Slocum, 1984)

People within the organization agree on the workload and how work is carried out and that agreement creates the climate. Moira Clark, professor of strategic marketing at Henley Business School identified seven different areas that make up the organizational climate in your organization. The seven areas she identified are structure, reward and recognition, cohesion, warmth and support, and customer care.

We have described each sphere how it affects your business.

Structure

What does your company structure look like? Hierarchy? Matrix? The Holocracy of Zappos? This isn’t just about structure but how people interact with one another. Are your rules rigid or flexible? Can individual employees make decisions? Or do employees have to run even small choices up the flagpole for approval (or denial)? Your company structure is a major contributor to your overall organizational climate.

Reward and Recognition

How you pay your employees and how you reward them for excellence strongly influences your organizational climate. Are your salaries fair and relatively open, or is salary information kept hush-hush because management knows their salary variations wouldn’t hold up in court? How often do you evaluate salaries and make adjustments with the market?

Each company approaches its rewards and recognition programs differently, and how you do this impacts your employees’ feelings. If your pay is unfair or overly secret, the employee’s shared perception of your climate will be one of unfairness. On the other hand, if every pay decision is backed by performance and market rates, the climate will shift in a positive direction.

Cohesion

Are your employees a part of the same team? Or are you siloed into individual departments that occasionally pass each other in the hallway? You want to answer the question, “who is ‘us’ and who is ‘them’?” If the answer is everyone at our company is “us,” and our “competitor” is them, you have a cohesive climate. But, if your “us” is managers and “them” is the union and employees or vice versa, you’ll see a lack of company cohesion.

Sometimes, people may not know why they are working on a particular project in a disjointed environment. They may not understand the anticipated outcome. This environment can lead to feelings of confusion and weakened interest in company success. If Department A cannot see how their work fits in with Department B, a lack of support will exist between the two departments.

Warmth and Support

How well your employees work together is part of the organizational climate. What happens when a colleague is out sick? Does everyone take over the work, knowing that your sick co-worker needs rest, or does everyone complain that their colleague didn’t follow social distancing guidelines and deserves to be sick?

Are people afraid to go to their managers or HR with a problem? Or do people work together and support each other through difficult times? Do employees receive support when they are experiencing burnout? Do cliques exist and gossip whispers its way around the building? Or do people trust each other? How people care for each other at work is an integral part of your organizational climate.

Customer Care

Your company’s attitude toward customers is the last pillar of organizational climate. Is the customer king and never wrong, or do you put your employees first? If you choose the former, you may find yourself neglecting your employees to please a demanding customer who will never be happy. If you put too much emphasis on employee happiness, no one will stick around on a Friday afternoon to answer a customer’s question.

Finding a positive balance between delighted customers and employee happiness can lead to both satisfied customers and happy employees. Swing too far in one direction, though, and someone will end up miserable. Your business cannot survive without both employees and customers, so this is a critical balancing act.

Conclusion

Take a look at these seven different areas of organizational climate and ask yourself how your organization ranks. If what you see isn’t what you want, making a climate change is possible. Sit down and determine how you want your organizational climate to look and make the necessary changes.

Much like climate change in nature, making changes to your organizational climate will take time, and competing forces may make the changes difficult. However, every business can have a climate that supports their success if the leaders are committed to creating this work environment.