Organizational

Culture
Institutionalization:
Institutionalization: AA Forerunner
Forerunner of
of Culture
Culture
Institutionalization
When an organization takes on a life of its own, apart
from any of its members, becomes valued for itself, and
acquires immortality
What
What Is
Is Organizational
Organizational Culture?
Culture?
Organizational Culture
A common perception held Characteristics
Characteristics
by the organization’s 1.1. Innovation
Innovationandandrisk
risk
members; a system of taking
taking
shared meaning 2.2. Attention
Attentiontotodetail
detail
3.3. Outcome
Outcomeorientation
orientation
4.4. People
Peopleorientation
orientation
5.5. Team
Teamorientation
orientation
6.6. Aggressiveness
Aggressiveness
7.7. Stability
Stability
 Contrasting
Contrasting Organizational
Organizational Cultures
Cultures
Organization A
This organization is a manufacturing firm. Managers are expected to fully document
all decisions; and “good managers” are those who can provide detailed data to
support their recommendations. Creative decisions that incur significant change or
risk are not encouraged. Because managers of failed projects are openly criticized
and penalized, managers try not to implement ideas that deviate much from the
status quo. One lower-level manager quoted an often used phrase in the company:
“If it ain’t broke, don’t fix it.”
There are extensive rules and regulations in this firm that employees are
required to follow. Managers supervise employees closely to ensure there are no
deviations. Management is concerned with high productivity, regardless of the
impact on employee morale or turnover.
Work activities are designed around individuals. There are distinct departments
and lines of authority, and employees are expected to minimize formal contact with
other employees outside their functional area or line of command. Performance
evaluations and rewards emphasize individual effort, although seniority tends to be
the primary factor in the determination of pay raises and promotions.
E X H I B I T 17–1
E X H I B I T 17–1
 Contrasting
Contrasting Organizational
Organizational Cultures
Cultures (cont’d)
(cont’d)
Organization B
This organization is also a manufacturing firm. Here, however, management
encourages and rewards risk taking and change. Decisions based on intuition are
valued as much as those that are well rationalized. Management prides itself on its
history of experimenting with new technologies and its success in regularly
introducing innovation products. Managers or employees who have a good idea are
encouraged to “run with it.” And failures are treated as “learning experiences.” The
company prides itself on being market-driven and rapidly responsive to the changing
needs of its customers.
There are few rules and regulations for employees to follow, and supervision is
loose because management believes that its employees are hardworking and
trustworthy. Management is concerned with high productivity, but believes that this
comes through treating its people right. The company is proud of its reputation as
being a good place to work.
Job activities are designed around work teams, and team members are
encouraged to interact with people across functions and authority levels. Employees
talk positively about the competition between teams. Individuals and teams have
goals, and bonuses are based on achievement of these outcomes. Employees are
given considerable autonomy in choosing the means by which the goals are attained.
E X H I B I T 17–1 (cont’d)
E X H I B I T 17–1 (cont’d)
Do
Do Organizations
Organizations Have
Have Uniform
Uniform Cultures?
Cultures?
Dominant Culture
Expresses the core values that
are shared by a majority of the
organization’s members

Subcultures
Minicultures within an
organization, typically defined by
department designations and
geographical separation
Do
Do Organizations
Organizations Have
Have Uniform
Uniform
Cultures?
Cultures? (cont’d)
(cont’d)
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
What Is
Is Organizational
Organizational Culture?
Culture? (cont’d)
(cont’d)
 Culture versus Formalization
– A strong culture increases behavioral consistency and
can act as a substitute for formalization.
 Organizational Culture versus National Culture
– National culture has a greater impact on employees
than does their organization’s culture.
– Nationals selected to work for foreign companies may
be atypical of the local/native population.
What
What Do
Do Cultures
Cultures Do?
Do?

Culture’s
Culture’sFunctions
Functions
1.1. Defines
Definesthe
theboundary
boundarybetween
betweenone
oneorganization
organizationand
and
others
others
2.2. Conveys
Conveysaasense
senseofofidentity
identityfor
forits
itsmembers
members
3.3. Facilitates
Facilitatesthe
thegeneration
generationofofcommitment
commitmenttoto
something
somethinglarger
largerthan
thanself-interest
self-interest
4.4. Enhances
Enhancesthe
thestability
stabilityofofthe
thesocial
socialsystem
system
5.5. Serves
Servesas asaasense-making
sense-makingandandcontrol
controlmechanism
mechanism
for
forfitting
fittingemployees
employeesininthe
theorganization
organization
What
What Do
Do Cultures
Cultures Do?
Do?

Culture
Cultureas
asaaLiability
Liability
1.1. Barrier
Barriertotochange
change
2.2. Barrier
Barriertotodiversity
diversity
3.3. Barrier
Barriertotoacquisitions
acquisitionsand
andmergers
mergers
How
How Culture
Culture Begins
Begins
 Founders hire and keep only
employees who think and feel the
same way they do.
 Founders indoctrinate and
socialize these employees to their
way of thinking and feeling.
 The founders’ own behavior acts
as a role model that encourages
employees to identify with them
and thereby internalize their
beliefs, values, and assumptions.
 Keeping
Keeping Culture
Culture Alive
Alive
 Selection
– Concern with how well the candidates will fit into
the organization
– Provides information to candidates about the
organization
 Top Management
– Senior executives help establish behavioral
norms that are adopted by the organization
 Socialization
– The process that helps new employees adapt to
the organization’s culture
 Stages
Stages in
in the
the Socialization
Socialization Process
Process
Prearrival Stage
The period of learning in the socialization
process that occurs before a new
employee joins the organization

Encounter Stage
The stage in the socialization process in which a
new employee sees what the organization is
really like and confronts the possibility that
expectations and reality may diverge

Metamorphosis Stage
The stage in the socialization process in which a new employee
changes and adjusts to the work, work group, and organization
AA Socialization
Socialization Model
Model

E X H I B I T 17–2
E X H I B I T 17–2
 Entry
Entry Socialization
Socialization Options
Options

•• Formal
Formalversus
versusInformal
Informal
•• Individual
Individualversus
versusCollective
Collective
•• Fixed
Fixedversus
versusVariable
Variable
•• Serial
Serialversus
versusRandom
Random
•• Investiture
Investitureversus
versusDivestiture
Divestiture

E X H I B I T 17–3
E X H I B I T 17–3

Source: Based on J. Van Maanen, “People Processing: Strategies of Organizational

Socialization,” Organizational Dynamics, Summer 1978, pp. 19–36; and E. H. Schein,
Organizational Culture,” American Psychologist, February 1990, p. 116.
How
How Organization
Organization Cultures
Cultures Form
Form

E X H I B I T 17–4
E X H I B I T 17–4
How
How Employees
Employees Learn
Learn Culture
Culture

•• Stories
Stories
•• Rituals
Rituals
•• Material
MaterialSymbols
Symbols
•• Language
Language
Creating
Creating An
An Ethical
Ethical Organizational
Organizational Culture
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
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
 Key Variables Shaping Customer-
Responsive Cultures
1. The types of employees hired by the
organization
2. Low formalization: the freedom to meet
customer service requirements
3. Empowering employees with decision-
making discretion to please the customer
4. Good listening skills to understand
customer messages
5. Role clarity that allows service employees
to act as “boundary spanners”
6. Employees who engage in organizational
citizenship behaviors
Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
(cont’d)
(cont’d)

Managerial
ManagerialActions
Actions
•• Select
Selectnew
newemployees
employeeswith
withpersonality
personalityand
andattitudes
attitudes
consistent
consistentwith
withhigh
highservice
serviceorientation
orientation
•• Train
Trainand
andsocialize
socializecurrent
currentemployees
employeestotobe
bemore
more
customer
customerfocused
focused
•• Change
Changeorganizational
organizationalstructure
structuretotogive
giveemployees
employeesmore
more
control
control
•• Empower
Empoweremployees
employeestotomake
makedecisions
decisionsabout
abouttheir
theirjobs
jobs
Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
(cont’d)
(cont’d)

Managerial
ManagerialActions
Actions(cont’d)
(cont’d)
•• Lead
Leadby
byconveying
conveyingaacustomer-focused
customer-focusedvision
visionand
and
demonstrating
demonstratingcommitment
commitmenttotocustomers
customers
•• Conduct
Conductperformance
performanceappraisals
appraisalsbased
basedon
oncustomer-
customer-
focused
focusedemployee
employeebehaviors
behaviors
•• Provide
Provideongoing
ongoingrecognition
recognitionfor
foremployees
employeeswho
whomake
make
special
specialefforts
effortstotoplease
pleasecustomers
customers
Spirituality
Spirituality and
and Organizational
Organizational Culture
Culture
Workplace Spirituality
The recognition that people have an inner life that nourishes
and is nourished by meaningful work that takes place in the
context of the community

Characteristics
Characteristics
•• Strong
Strongsense
senseofofpurpose
purpose
•• Focus
Focuson
onindividual
individualdevelopment
development
•• Trust
Trustand
andopenness
openness
•• Employee
Employeeempowerment
empowerment
•• Toleration
Tolerationofofemployee
employeeexpression
expression
Reasons
Reasons for
for the
the Growing
Growing Interest
Interest in
in Spirituality
Spirituality
 As a counterbalance to the pressures and stress of a
turbulent pace of life and the lack of community many
people feel and their increased need for involvement and
connection.
 Formalized religion hasn’t worked for many people.
 Job demands have made the workplace dominant in many
people’s lives, yet they continue to question the meaning of
work.
 The desire to integrate personal life values with one’s
professional life
 An increasing number of people are finding that the pursuit
of more material acquisitions leaves them unfulfilled.

E X H I B I T 17–5
E X H I B I T 17–5
How
How Organizational
Organizational Cultures
Cultures Have
Have an
an
Impact
Impact on
on Performance
Performance and
and Satisfaction
Satisfaction

E X H I B I T 17–6
E X H I B I T 17–6
Chapter
Chapter Check-up:
Check-up: Organizational
Organizational Culture
Culture

If you walked into a bank and saw vibrant,

modern, abstract art on the walls and big
bright blue balls in the waiting area for
customers to sit on (or throw!), what would
you think about the culture? How would you
expect your transaction with the teller to be
different from other banks you’ve been in?
Chapter
Chapter Check-up:
Check-up: Organizational
Organizational Culture
Culture

Joseph arrives for his first day of work

and is told that he’ll be spending two
months “unlearning all he’s learned so
far in school.” He is experiencing
________________.

Investiture
Divestiture
Sequential Training
On the job training
Chapter
Chapter Check-up:
Check-up: Organizational
Organizational Culture
Culture

How
Howare
arethe
thefounders
foundersof
of your
your university
universityor
or
college
college represented
representedininthe
thecurrent
currentculture?
culture?In
In
other
otherwords,
words,what
what values
valuesof
ofthe
thefounders
founders are
are
still
stillprevalent
prevalenttoday
todayand
andengrained
engrainedasaspart
partofof
the
the organizational
organizationalculture?
culture?