Examining the mediating role of organisational climate on the relationship between firm ownership type and manufacturing performance in the garment industry of Sri Lanka

Abstract

This paper conceptualises a model on how and to what extent organisational climate mediates the relationship between firm ownership type, based on the region of origin and manufacturing performance in the garment industry of Sri Lanka. It primarily discusses the process by which the organisational climate-based mediation model was conceptualised using Denison’s culture traits (adaptability, mission, involvement and consistency). It identifies potential research gaps, poses research questions to be investigated and formulates hypotheses to test the model. It uses qualitative and quantitative methods. The qualitative study (interviews) was mainly carried out to understand the operational context of the Board of Investment (BOI) approved garment industry of Sri Lanka. It also supported the development of hypotheses where existing empirical studies are lacking. The quantitative study tests the formulated hypotheses. The findings contribute to better understanding the relationship between firm ownership type and manufacturing performance. It provides new insights into the most and least effective firm ownership types, culture traits and organisational climate profile configurations. It contributes theoretically and practically to the literature on the relationships between firm ownership type, organisational climate and manufacturing performance by further validating the Denison Organisation Culture Survey, its predictive capabilities and the applicability of its balanced culture hypothesis in the garment industry of Sri Lanka.
Keywords: Organisational climate, firm ownership type, manufacturing performance, garment industry, Sri Lanka