Is There a Link between Organisational Culture and Hospital Performance?: Evidence from the English NHS

Within institutional economics, organisational culture is viewed as an intangible social capital asset, which facilitates production. Changing organisational culture is therefore viewed as one means of improving organisational production and performance. Both policy activity and managerial action have frequently been directed towards 'changing the culture' of health care delivery organisations. Yet the empirical evidence so far linking culture to performance is limited. The aim of this study is to examine the association between senior management team culture and hospital performance in the English NHS. We examined quantitative relationships between senior management team culture and hospital performance in 170 acute hospital organisations in the English NHS. A national postal survey was used to assess senior management team culture in each acute hospital in two periods, 2002 and 2006, using a culture rating instrument called the Competing Values Framework (CVF). The CVF provides a culture typology that classifies culture as a balance between four cultural archetypes: Clan, Developmental, Hierarchical or Rational cultures. The hospital-based culture assessments were combined with a large routinely collected dataset on various aspects of organisational performance (such as finance, staffing, activity, access, and various quality measures). Associations between measures of culture and measures of performance were explored using various multivariate econometric analyses, such as multi-level models and multinomial logit models. We also compared changes in hospital culture over the 2 periods. The majority of the organisations were seen to have a dominant Clan culture at senior management level, followed by a dominant Rational culture. The study found significant quantitative associations between senior management culture and various dimensions of measured quality and performance and provides important evidence that different organisational culture types may be more or less able to perform well. Those aspects of performance valued within the dominant culture are those aspects on which the organisation excels. For example, organisations with Hierarchical cultures were more likely to perform well in terms of patient waiting times, while those with Clan cultures scored better on measures of staff satisfaction. We conclude that senior management culture matters in the delivery of high performance in health care. The practical challenge for policy makers lies in encouraging an appropriate blend of local organisational cultures that underpin those aspects of quality and performance that are most valued by key stakeholders.