1. © 2011 Cengage Learning. All rights reserved. Chapter 16 Organizational Culture Learning Outcomes 1.Identify the three levels of culture and the roles they play in an organization. 2.Evaluate the four functions of culture within an organization. 3.Explain the relationship between organizational culture and performance. 4.Describe five ways leaders reinforce organizational culture. 5.Describe the three stages of organizational socialization and the ways culture is communicated in each step. 6.Discuss how managers assess their organization’s culture. 7.Explain actions managers can take to change organizational culture. 8.Identify the challenges organizations face developing positive, cohesive cultures.

2. © 2011 Cengage Learning. All rights reserved. Organizational (Corporate) Culture a pattern of basic assumptions that are considered valid and that are taught to new members as the way to perceive, think, and feel in the organization

3. © 2011 Cengage Learning. All rights reserved. Learning Objective Identify the three levels of culture and the roles they play in an organization. 1

4. Levels of Organizational Culture s Artifacts – symbols of culture in the physical and social work environment Values Espoused: what members of an organization say they value Enacted: reflected in the way individuals actually behave Assumptions – deeply held beliefs that guide behavior and tell members of an organization how to perceive and think about things © 2011 Cengage Learning. All rights reserved.

5. s Artifacts – symbols of culture in the physical and social work environment Values Espoused: what members of an organization say they value Enacted: reflected in the way individuals actually behave Assumptions – deeply held beliefs that guide behavior and tell members of an organization how to perceive and think about things © 2011 Cengage Learning. All rights reserved. Reprinted with permission from Edgar H. Schein, Organizational Culture and Leadership: A Dynamic View. Copyright © 1985 Jossey-Bass Inc, a subsidiary of John Wiley & Sons, Inc. Organizational Culture Visible, often not decipherable Greater level of awareness Taken for granted, Invisible, Preconscious

6. © 2011 Cengage Learning. All rights reserved. Types of Artifacts Personal Enactment Ceremonies and Rites Stories –About the boss –About getting fired –About relocating –About promotions –About crisis situations –About status considerations Rituals Symbols

7. © 2011 Cengage Learning. All rights reserved. Beyond the Book: Identifying Norms This exercise asks you to identify campus norms at your university. Every organization or group has a set of norms that help determine individuals’ behavior. A norm is an unwritten rule for behavior in a group. When a norm is not followed, negative feedback is given. It may include negative comments, stares, harassment, and exclusion. 1. As a group, brainstorm all the norms you can think of in the following areas: Dress Classroom behavior; Studying; Weekend activities; Living arrangements; Campus activities; Dating; Relationships with faculty; Eating on campus versus off campus; Transportation 2. How did you initially get this information? 3. What happens to students who don’t follow these norms? 4. What values can be inferred from these norms?

8. © 2011 Cengage Learning. All rights reserved. Learning Objective Evaluate the four functions of culture within an organization. 2

9. © 2011 Cengage Learning. All rights reserved. Functions of Organizational Culture Culture provides a sense of identity to members and increases their commitment to the organization Culture is a sense-making device for organization members Culture reinforces the values of the organization Culture serves as a control mechanism for shaping behavior

10. © 2011 Cengage Learning. All rights reserved. Beyond the Book: NetApp’s Culture of Openness What is the key to success at NetApp? According to top executives, it’s openness. Everyone, including the CEO, works in an open cubicle. Information is shared freely. Every two weeks, employees meet with the Vice President to share their perspectives. In addition, NetApp shows employees that they are valuable and cared for through flexible scheduling, and sponsorship of volunteer activities. NetApp’s culture of openness and trust has made it one of Fortune magazine’s “Best Companies to Work For.”

11. © 2011 Cengage Learning. All rights reserved. Learning Objective Explain the relationship between organizational culture and performance. 3

12. © 2011 Cengage Learning. All rights reserved. Theories on the relationship between organizational culture and performance Strong Culture Perspective Fit Perspective Adaptive Perspective

13. © 2011 Cengage Learning. All rights reserved. Strong Culture an organizational culture with a consensus on the values that drive the company and with an intensity that is recognizable even to outsiders

14. © 2011 Cengage Learning. All rights reserved. BECAUSE They are characterized by goal alignment They create a high level of motivation because of shared values by the members They provide control without the oppressive effects of bureaucracy Strong Cultures Facilitate Performance

15. © 2011 Cengage Learning. All rights reserved. Fit Perspective a culture is good only if it fits the industry or the firm’s strategy

16. © 2011 Cengage Learning. All rights reserved. Three particular industry characteristics affect culture: 1.Competitive environment 2.Customer requirements 3.Societal expectations Fit Perspective

17. © 2011 Cengage Learning. All rights reserved. Adaptive Culture an organizational culture that encourages confidence and risk taking among employees, has leadership that produces change, and focuses on the changing needs of customers

18. © 2011 Cengage Learning. All rights reserved. Adaptive vs. Nonadaptive Cultures

19. © 2011 Cengage Learning. All rights reserved. Learning Objective Describe five ways leaders reinforce organizational culture. 4

20. © 2011 Cengage Learning. All rights reserved. Most Important Elements in Managing Culture What leaders pay attention to How leaders react to crises How leaders behave How leaders allocate rewards How leaders hire and fire individuals

21. © 2011 Cengage Learning. All rights reserved. Learning Objective Describe the three stages of organizational socialization and the way culture is communicated in each step. 5

22. © 2011 Cengage Learning. All rights reserved. Organizational Socialization the process by which newcomers are transformed from outsiders to participating, effective members of the organization

23. Organizational Socialization Process

24. © 2011 Cengage Learning. All rights reserved. 1. [Anticipatory Socialization] – all of the learning that takes place prior to the newcomer’s first day on the job 2. [Encounter] – newcomer learns the tasks associated with the job, clarifies roles, and establishes new relationships at work 3. [Change and Acquisition] – newcomer begins to master the demands of the job [ Socialization Process ]

25. © 2011 Cengage Learning. All rights reserved. Outcomes of Socialization Newcomers who are successfully socialized should exhibit: –Good performance –High job satisfaction –Intention to stay with organization –Low levels of distress symptoms –High level of orgnaizational commitment

26. © 2011 Cengage Learning. All rights reserved. Learning Objective Discuss how managers assess their organization’s culture. 6

27. © 2011 Cengage Learning. All rights reserved. Organizational Culture Inventory Focuses on behaviors that help employees fit into the organization and meet coworker expectations Uses Maslow’s hierarchy of needs to measure twelve cultural styles

28. © 2011 Cengage Learning. All rights reserved. Kilmann-Saxton Culture-Gap Survey Focuses on what actually happens in the organization and the expectations of others Two underlying dimensions – technical/human and time.

29. © 2011 Cengage Learning. All rights reserved. Triangulation the use of multiple methods to measure organizational culture

30. © 2011 Cengage Learning. All rights reserved. Learning Objective Explain actions managers can take to change organizational culture. 7

31. © 2011 Cengage Learning. All rights reserved. Cultural Changes With rapid environmental changes such as globalization, workforce diversity and technological innovation, the fundamental assumptions and basic values that drive the organization may need to be altered.

32. © 2011 Cengage Learning. All rights reserved. Why is Change Difficult? Assumptions are often unconscious Culture is deeply ingrained and behavioral norms and rewards are well learned

33. Interventions for Changing Organizational Culture

34. © 2011 Cengage Learning. All rights reserved. Learning Objective Identify the challenges organizations face developing positive, cohesive cultures. 8

35. © 2011 Cengage Learning. All rights reserved. Challenges to Developing Positive, Cohesive Culture Merger or Acquisition Developing a global organizational culture Developing an ethical organizational culture Developing a culture of empowerment and quality

36. © 2011 Cengage Learning. All rights reserved. Beyond the Book: Six Guidelines to Creating a Global Culture 1.Create a clear and simple mission statement 2.Create systems that ensure an effective flow of information 3.Broaden managers’ minds to allow them to think globally 4.Develop global career paths 5.Use cultural differences as a major asset 6.Implement worldwide management education and team development programs

37. © 2011 Cengage Learning. All rights reserved. Rendition 1.Review the section, “Basic Design Dimensions.” Which dimensions does this scene show or imply? 2. Can you sense the division of labor represented by Senator Hawkins and Alan Smith? Corrine Whitman does not appear in this scene but is also part of a division of labor. 3. Review the five structural configurations described in the chapter. Which of those configurations best describes the likely structure of Senator Hawkins’ office? Which configurations do not apply? Why?