Organisational Culture. The most straightforward definition of organisational culture is simply “the way we do things around here” More detailed definitions include – Ideologies, beliefs and deep-set values Customary and traditional way of thinking Basic values, ideologies and assumptions which guide and fashion behaviour Pattern and shared beliefs, attitudes, assumptions and values Values and beliefs central to the organisation

Manifestations of organisational culture Corporate values strongly held beliefs about what is right and wrong and that lead people to take certain forms of action. Organisational climate the working atmosphere as perceived and experienced by the people in the organisation. Management style the way managers exert authority Organisational Behaviour the way people act within the organisation. Structure the degree of flexibility in an organisation.

Influences on organisational culture The philosophy of the founders Its history and traditions The nature and activities of the business Size Ownership Technology External factors Location Managers and employees The customers

Types of culture Organisational (bureaucratic) Emphasis on role and procedures; New ideas are dismissed; Roles are precisely defined; Emphasis on dealing with problems; Stability and experience are highly valid attributes; Making the right decision is less important than making the decision in the right way; Command and control appear to be the dominant process.

Types of culture Adventurous. Emphasis on taking advantage of new opportunities; Welcome given to new ideas; Motivation and innovation are valued characteristics; Staff are allowed autonomy and able to show initiative; Flat, flexible structure; Minds and policies are frequently changed according to circumstances.

Types of culture Power culture The employee does what he/she is told. This type of organisation has a powerful head and centralised decision making. Power culture have advantages in terms of being able to move quickly to secure an advantage over rivals. However, much depends on the central figure. Unless succession is prepared the organisation may lose direction and stagnate.

Types of culture Role culture. The employee acts within the parameters of the job description. The culture is seen in large bureaucracies. Structures and procedures are planned in a logical way. It is the post or role which matters not the individual. The firm can exist in a market with stable products with a long lifecycle, buy may struggle where rapid change is required.

Types of culture Task culture The employee acts in a way he/she considers suitable for the task. Stress is placed upon teamwork rather than individual effort. The great advantage of this culture is flexibility and the benefits that come from greater autonomy. Task groups are difficult to control once they are underway.

Types of culture Person culture. The individual does his own thing – the firm, its organisation only exist to serve the individual. Not only is this rare, but is only suitable for small partnerships. If the organisation grows it may take on a power or role culture.

Mechanistic v Organic Organisations Mechanistic – has a bureaucratic approach, based upon clear structure, procedures, formal communications and controls. Organic – is more fluid, with greater flexibility, broad job descriptions and informal procedures.

Organisations are generally moving from the mechanistic to organic style as the pace of change necessitates greater flexibility and rapid response. There is no single best style as particular circumstances will dictate which is the most appropriate – small organisations dependant on new technology benefit from an organic style. Whereas a large organisation in a stable environment can benefit from a mechanistic approach. The two styles should be seen as part of a spectrum with no organisation entirely one or the other. To be most effective, the management style should match that of the unit or organisation. This approach is best known as contingency theory instead of believing there is one single best way, strategies should be seen as appropriate for the circumstances.

MechanisticOrganic  Specialised differentiation and definition of tasks in the organisation.  Hierarchical supervision and reconciliation of problems.  Precise definition of job responsibilities, methods, rights and obligations.  Perceived location of superior knowledge at the top of the hierarchy.  Vertical interaction of individuals, between subordinates and superiors.  Insistence on loyalty to organisation and obedience to superiors.  More prestige attached to job than to more general knowledge, experience and skills.  Contributive nature of special knowledge to the total concerns of the organisation.  Redefinition of tasks and responsibilities in terms of interaction with others.  Commitment to the organisation beyond any technical/precise definition – such commitment more valued than loyalty.  Network structure of control, authority and communication.  Omniscience not imputed to senior directors, knowledge located anywhere in the organisation, and this location may become centre of authority for a given issue.  Lateral, rather than vertical, direction of communication.  Communication consists of informal and advice rather than instructions and decisions.

Why is culture so important? The real question is “Do people love their work?” Culture is important because – Affects the degree of employee motivation. Will affect labour turnover. Affects morale and goodwill Reflected in the reputation of an organisation Affects productivity Affects the quality of work Influences the degree to which change is accepted