© 2006 The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill Ryerson 16 C H A P T E R: S I X T E E N Organizational Culture

2 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Cirque du Soleil’s Corporate Culture Through its strong culture of risk-taking and creativity, Montreal- based Cirque du Soleil has become a leader in big top entertainment. CP/Paul Chaisson

3 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Organizational Culture Defined The basic pattern of shared assumptions, values, and beliefs considered to be the correct way of thinking about and acting on problems and opportunities facing the organization. CP/Paul Chaisson

4 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Elements of Organizational Culture

5 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Meaning of Cultural Content Cultural content refers to the relative ordering of beliefs, values, and assumptions. Example: Toronto Star’s “Atkinson Principles”: Canadian independence, social justice, and civic duties An organization emphasizes only a handful of values out of dozens or hundreds of values that exist.

6 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Organizational Subcultures Located throughout the organization Can enhance or oppose (countercultures) firm’s dominant culture Two functions of countercultures:  provide surveillance and critique, ethics  source of emerging values

7 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Mayo Clinic Deciphers its Culture To decipher its culture and identify ways to reinforce it at the two newer sites, the Mayo Clinic retained an anthropologist who shadowed employees, joined physicians on patient visits, and posed as a patient to observe what happens in waiting rooms. Courtesy of the Mayo Clinic

8 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Artifacts: Stories and Legends Social prescriptions of desired (undesired) behavior Provides a realistic human side to expectations Most effective stories and legends:  Describe real people  Assumed to be true  Known throughout the organization  Are prescriptive

9 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Artifacts: Rituals and Ceremonies Rituals  programmed routines  (e.g., how visitors are greeted) Ceremonies  planned activities for an audience  (e.g., award ceremonies)

10 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Artifacts: Organizational Language Words used to address people, describe customers, etc. Leaders use phrases and special vocabulary as cultural symbols  e.g., Container Store’s “Being Gumby” Language also found in subcultures  e.g., Whirlpool’s “PowerPoint culture”

11 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Artifacts: Physical Structures/Symbols Building structure -- may shape and reflect culture  Mountain Equipment Co-op’s retail outlets reflect and maintain an enviro-friendly culture Office design conveys cultural meaning  Furniture, office size, wall hangings

12 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Benefits of Strong Corporate Cultures Strong Organizational Culture Social Control Improves Sense-Making Social Glue

13 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Problems with Strong Cultures 1.Culture content might be misaligned with the organization’s environment. 2.Strong cultures may focus on mental models that could be limiting 3.Strong cultures suppress dissenting values from subcultures.

14 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Adaptive Organizational Cultures  External focus: Firm’s success depends on continuous change  Focus on processes more than goals  Strong sense of ownership  Proactive: Seek out opportunities

15 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Org Culture and Ethics Executives view org culture is one of three main influences on business ethics Organizational culture also an ethical problem when it is very strong --corporate cults

16 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Bicultural Audit Part of “due diligence” in merger Minimizes risk of cultural collision by diagnosing companies before merger Three steps in bicultural audit: 1.Examine artifacts 2.Analyze data for cultural conflict/compatibility 3.Identify strategies and action plans to bridge cultures

17 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Merging Organizational Cultures Assimilation Deculturation Acquired company embraces acquiring firm’s cultural values Acquiring firm imposes its culture on unwilling acquired firm Integration Cultures combined into a new composite culture Separation Merging companies remain separate with their own culture

18 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e StrengtheningOrganizationalCulture Founders and leaders Culturallyconsistentrewards Stableworkforce Selectionandsocialization Managing the cultural network Strengthening Organizational Culture

19 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Organizational Socialization Defined The process by which individuals learn the values, expected behaviours, and social knowledge necessary to assume their roles in the organization

20 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Socialization: Learning & Adjustment Learning Process  Newcomers make sense of the organization’s physical, social, and strategic/cultural dynamics Adjustment Process  Newcomers need to adapt to their new work environment New work roles New team norms New corporate cultural values

21 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e InsiderInsider Changing roles and behaviourChanging roles and behaviour Resolving conflictsResolving conflicts Stages of Socialization NewcomerNewcomer Testing expectationsTesting expectations OutsiderOutsider Gathering informationGathering information Forming psychological contractForming psychological contract Pre-Employment Stage Encounter Stage Role Management

22 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e IndividualAttractsOrganization IndividualSelectsOrganization OrganizationAttractsIndividual OrganizationSelectsIndividual Conflict A Conflict B Conflict CConflict D Pre-employment Socialization Conflicts

23 © 2006 The McGraw-Hill Companies, Inc. All rights reserved. McShane/ Canadian OB 6e Realistic Job Previews A balance of positive and negative information about the job and work context Benefits of RJPs  Less turnover, higher job performance  Less reality shock  Vaccination effect  Builds loyalty

© 2006 The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill Ryerson 16 C H A P T E R: S I X T E E N Organizational Culture