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Organization culture is a set of values held by individuals in a firm that help employees understand acceptability of actions. Organization culture is assumed to perform at higher levels than those without a strong culture. An individual's personal values guide behavior on and off the job.
Organization culture is a set of values held by individuals in a firm that help employees understand acceptability of actions. Organization culture is assumed to perform at higher levels than those without a strong culture. An individual's personal values guide behavior on and off the job.
Organization culture is a set of values held by individuals in a firm that help employees understand acceptability of actions. Organization culture is assumed to perform at higher levels than those without a strong culture. An individual's personal values guide behavior on and off the job.
Chapter Learning Objectives Define organization culture, explain how it affects employee behavior, and understand its historical roots. Describe how to create organization culture. Describe different types of culture Describe two different approaches to culture in organizations. Discuss the important elements of managing the organizational culture Identify emerging issues in organization culture. The Nature of Organization Culture Why Study Culture? It is assumed that organizations with a strong culture perform at higher levels than those without a strong culture Organizational Culture A set of values held by individuals in a firm that help employees understand acceptability of actions
The Nature of Organization Culture Culture Values Are often taken for granted (implicit) ;The conscious, affective desires or wants of people that guide their behavior; A societys ideas about what is right or wrong May not be made explicit (i.e., not written down) Are communicated through symbolic means; Are passed from one generation to the next Organizations are able to operate efficiently only when shared values exist among the employees. An individuals personal values guide behavior on and off the job.
18.1 Definitions of Organization Culture Definition Source A belief system shared by an organizations members J. C. Spender, Myths, Recipes and Knowledge-Bases in Organizational Analysis (Unpublished manuscript, Graduate School of Management, University of California at Los Angeles, 1983), p. 2. Strong, widely shared core values C. OReilly, Corporations, Cults, and Organizational Culture: Lessons from Silicon Valley Firms (Paper presented at the Annual Meeting of the Academy of Management, Dallas, Texas, 1983), p. 1. The way we do things around here T. E. Deal and A. A. Kennedy, Corporate Cultures: The Rites and Rituals of Corporate Life (Reading, MA: Addison-Wesley, 1982), p. 4. The collective programming of the mind G. Hofstede, Cultures Consequences: International Differences in Work-Related Values (Beverly Hills, CA: Sage, 1980), p. 25. Collective understandings J. Van Maanen and S. R. Barley, Cultural Organization: Fragments of a Theory (Paper presented at the Annual Meeting of the Academy of Management, Dallas, Texas, 1983), p. 7. A set of shared, enduring beliefs communicated through a variety of symbolic media, creating meaning in peoples work lives J. M. Kouzes, D. F. Caldwell, and B. Z. Posner, Organizational Culture: How It Is Created, Maintained, and Changed (Presentation at OD Network National Conference, Los Angeles, October 9, 1983). A set of symbols, ceremonies, and myths that communicates the underlying values and beliefs of that organization to its employees W. G. Ouchi, Theory Z: How American Business Can Meet the Japanese Challenge (Reading, MA: Addison-Wesley, 1981), p. 41. A dominant and coherent set of shared values conveyed by such symbolic means as stories, myths, legends, slogans, anecdotes, and fairy tales T. J. Peters and R. H. Waterman Jr., In Search of Excellence: Lessons from Americas Best-Run Companies (New York: Harper & Row, 1982), p. 103. The pattern of basic assumptions that a given group has invented, discovered, or developed in learning to cope with its problems of external adaptation and internal integration E. H. Schein, The Role of the Founder in Creating Organizational Culture, Organizational Dynamics, Summer 1985, p. 14. Examples of Cultural Attributes Documents Physical layouts Furnishings Language Jargon Work ethic and practice Fair days work for a fair days pay Loyalty Commitment Helping others Performance leads to rewards Management equity Competency counts Organizational Cultures Demonstration Visible but often not decipherable Greater level of awareness Taken for granted, invisible, preconscious Layer III: Basic Assumptions Relationship to environment Nature of reality, time, & space Nature of human nature Nature of human activity Nature of human relations Layer I: Artifacts & Creations Technology Art Visible and audible behavior patterns Layer II: Values Testable in the physical environment Testable only by social consensus Scheins Three-Layer Organizational Model Do Organizations Have Uniform Cultures? Culture is a descriptive term: it may act as a substitute for formalization Dominant Culture Expresses the core values that are shared by a majority of the organizations members Subcultures Minicultures within an organization, typically defined by department designations and geographical separation Core Values The primary or dominant values that are accepted throughout the organization Strong Culture A culture in which the core values are intensely held and widely shared
What Do Cultures Do? Cultures Functions 1. Defines the boundary between one organization and others 2. Conveys a sense of identity for its members 3. Facilitates the generation of commitment to something larger than self-interest 4. Enhances the stability of the social system 5. Serves as a sense-making and control mechanism for fitting employees in the organization
Culture as a Liability Barrier to change Occurs when cultures values are not aligned with the values necessary for rapid change Barrier to diversity Strong cultures put considerable pressure on employees to conform, which may lead to institutionalized bias Barrier to acquisitions and mergers Incompatible cultures can destroy an otherwise successful merger The Nature of Organization Culture Historical Foundations Anthropology Social Psychology Sociology Economics The Nature of Organization Culture Anthropological Contributions. Anthropologists study human cultures in terms of the values, symbols, and stories that people in society use to bring order and meaning to their lives. A description of the values and beliefs of one organization is not transferable to those of other organizations; each culture is unique Sociological Contributions. Sociologists have centered on the categorization of social system structure through systematic interviews, questionnaires, and other quantitative research methods. This sociological tradition was used in the major recent studies of organization culture, including Ouchis Theory Z, Deal and Kennedys Corporate Culture, and Peters and Watermans In Search of Excellence. Social Psychology Contributions. Social psychologists have concentrated on the creation and manipulation of symbols and stories in the development of organization culture. The impact of stories on decision making suggests an important reason that organization culture has such a powerful influence on the people in an organization. Economics Contributions. Economic contributions have been based on the economic performance of a firm. Researchers have attempted to link organization culture to economic performance. The relationship between culture and performance depends, to some extent, on the values expressed in the organizations culture. Organization Culture Versus Climate Organization Culture and Climate Refer to the overall work atmosphere of an organization, Deal with the social context in an organization, Affect the behavior of people in the organization. Organization Culture Versus Climate Organization Culture The study of culture is based in anthropology and sociology. Refers to the historical context within which a situation occurs. Deals with the way that people in the organization learn and communicate what is acceptablein other words, its norms and values Organization Climate
The study of climate is based in psychology Is based on individual perceptions and is often defined as the recurring patterns of behavior, attitudes, and feelings that characterize life in the organization and Refers to current situations in an organization and the linkages among work groups, employees, and work performance Climate is usually assumed to be more easily changed or manipulated by management. 18.2 Creating Organization Culture Creating Organization Culture Step 1Formulate Strategic Values Step 2Develop Cultural Values Step 3Create Vision Step 4Initiate Implementation Strategies Step 5Reinforce Cultural Behaviors Creating the Organization Culture Establish Values Strategic values The basic beliefs about an organizations environment that shape its strategy. Cultural values The values that employees need to have and act on for the organization to act on the strategic values. Create Vision Create a picture of the organization that portrays how the strategic and cultural values will combine to create the future. Creating the Organization Culture (contd) Initiate Implementation Strategies Take actions founded on the strategic and cultural values to accomplish the vision. Reinforce Cultural Behaviors Use formal reward systems to encourage desired employee behaviors Tell stories that epitomizing cultural values Conduct ceremonies and rituals that emphasize right actions by employees
Creating an Ethical Organizational Culture Characteristics of Organizations that Develop High Ethical Standards High tolerance for risk Low to moderate in aggressiveness Focus on means as well as outcomes Managerial Practices Promoting an Ethical Culture Being a visible role model Communicating ethical expectations Providing ethical training Rewarding ethical acts and punishing unethical ones Providing protective mechanisms Creating a Positive Organizational Culture Positive Organizational Culture A culture that: Builds on employee strengths Focus is on discovering, sharing, and building on the strengths of individual employees Rewards more than it punishes Articulating praise and catching employees doing something right Emphasizes individual vitality and growth Helping employees learn and grow in their jobs and careers Limits of Positive Culture: May not work for all organizations or everyone within them TYPES OF CULTURE Power culture Based on personalities Adaptable and informal Small size Good personal relations
Role culture Roles, not personalities Not entrepreneurial Stability Slow to change
Task culture Team based Get the job done Expertise Results-oriented Costly, because of variety Job satisfaction
Person culture
Types of Culture F o r m a l
C o n t r o l
O r i e n t a t i o n
Flexible Internal External Stable Clan Culture Entrepreneurial Culture Bureaucratic Culture Market Culture Forms of Attention Types of Cultures The Clan Culture A very friendly place to work where people share a lot of themselves. It is like an extended family. Being part of a working family, following tradition and rituals, teamwork and spirit, self-management, and social influence Example: Nordstroms
Types of Cultures The Hierarchy /Bureaucratic Culture A very formalized structured place to work. Procedures govern what people do. Emphasizes rules, policies, procedures, chain of command, and central decision making Example: government agencies, the military, firms managed by autocratic managers
Types of Cultures The Adhocracy/ Entrepreneurial Culture A dynamic entrepreneurial, and creative place to work. People stick their necks out and take risks. Innovation, creativity, risk taking, and aggressively seeking opportunities Employees understand that dynamic change, individual initiatives, and autonomy are standard practices Example: 3M
Types of Cultures The Market Culture A results oriented organization whose major concern is with getting the job done. People are competitive and goal- oriented. Emphasis on increased sales growth, increased market share, financial stability, and profitability. Employees have contractual relationship with firm Little feeling of teamwork and cohesiveness Example: Nike, Citigroup, Wells Fargo, Allstate
Approaches to Describing Organization Culture: The Ouchi Framework Typical United States firms Typical Japanese firms Type Z United States firms The Ouchi Framework 18.3 The Ouchi Framework 18.4 The Peters and Waterman Framework Attributes of an Excellent Firm 1. Bias for action: managers are not reluctant to make decisions even if all the facts arent in. 2. Stay close to the customer 3. Autonomy and entrepreneurship 4. Productivity through people 5. Hands-on management 6. Stick to the knitting: Successful firms do not diversify into businesses outside their expertise 7. Simple form, lean staff 8. Simultaneously loose and tight organization: tightness comes from the commitment of all organization members to the firms core values ; less administrative overhead, smaller staff, and fewer rules and regulations Managing Organization Culture Taking advantage of existing culture Teaching organization culture Changing organization culture Elements of Managing Organization Culture Managing Organization Culture (contd) Taking Advantage of the Existing Culture Easier and faster to alter employee behaviors within the existing culture than it is to change existing history, traditions, and values Managers must be aware and understand the organizations values Managers can communicate their understanding to lower- level individuals Managing Organization Culture (contd) Teaching Organization Culture Organizational socialization Is the process through which employees learn about the firms culture and pass their knowledge and understanding on to others Organizational mechanisms Are examples of organization culture that employees see in more experienced employees behaviors Corporate pamphlets and formal training sessions How Employees Learn Culture Stories Anchor the present into the past and provide explanations and legitimacy for current practices Rituals Repetitive sequences of activities that express and reinforce the key values of the organization Material Symbols Acceptable attire, office size, opulence of the office furnishings, and executive perks that convey to employees who is important in the organization Language Jargon and special ways of expressing ones self to indicate membership in the organization Managing Organization Culture (contd) Changing the Organization Culture Managing symbols Substituting stories and myths that support the new cultural values for those that support old ones Culture can be difficult to change when upper management inadvertently reverts to old behaviors The Stability of Change New values and beliefs must be seen as stable and influential as old ones Changing value systems requires enormous effort because value systems tend to be self-reinforcing Changing culture Culture can be changed, but Need time Support from top managers Other resources How to make culture change Change people Change corporate vision and mission Change organizational policies and system: reward system, recruitment and selection policies, technology
Emerging Issues in Organization Culture: Innovation Innovation The process of creating and doing new things that are introduced into the marketplace as products, processes, or services Radical Innovation Systems Innovation Incremental Innovation Types of Innovation Emerging Issues in Organization Culture: Innovation Radical innovation: represents a major breakthrough that changes or creates whole industries. Systems innovation: creates a new functionality by assembling parts in new ways. Incremental innovation: continues the technical improvement and extends the applications of radical and systems innovations Emerging Issues in Organization Culture: Innovation (contd) New Ventures Require entrepreneurship and good management Intrapreneurship Entrepreneurial activity that takes place within the context of a large organization Entrepreneurs profile Need for achievement Desire to assume responsibility Willing to take risks Focus on concrete results Emerging Issues in Organization Culture: Innovation (contd) Corporate Research Supports existing businesses to provide incremental innovations and to explore potential new technology bases Is responsible for keeping the companys products and processes technologically advanced Corporate culture can be instrumental in fostering environment for creativity and innovation
Emerging Issues in Organization Culture (contd) Empowerment Is enabling workers to set their own work goals, make decisions, solve problems within their sphere of responsibility and authority Appropriate Cultures (Goffee and Jones) Factors that may determine the appropriate type of culture appropriate for an organization: The nature of the value chain The dynamism of the environment
(Contributions To Political Science) Christine Ante (Auth.) - The Europeanisation of Vocational Education and Training-Springer International Publishing (2016)