Organizational Culture and Ethical Values – Chapter 10

Culture is the set of values, norms, guiding beliefs and understandings that is shared by members of an organization and taught to new members as the correct way to think, feel and behave. It represents the unwritten, feeling part of the organization. Everyone is a culture being, but culture generally goes unnoticed.

Culture is like an iceberg! Observable symbols, ceremonies, stories, slogans, behaviors, dress, physical settings. Underlying values, assumptions, beliefs, attitudes, feelings

Culture provides people with a sense of organizational identity and generates in them a commitment to beliefs and values that are larger than themselves. Though ideas that become part of the culture can come from anywhere within the organization, an organization’s culture generally begins with a founder or early leader who articulates and implements particular ideas and values as a vision, philosophy, or business strategy. ( )

Internal Integration –members develop a collective identity and know how to work together effectively. Guides day-to-day working relationships and determines how people communicate within the organization, what behavior is acceptable or not acceptable, and how power and status are allocated. (388)

External Adaptation – how the organization meets goals and deals with outsiders. Culture helps guide the daily activities of workers to meet certain goals. It can help the organization respond rapidly to customer needs or the moves of a competitor. The right culture can help transform an organization’s performance from average to truly great. (388)

Interpreting Culture – To identify and interpret culture requires that people make inferences based upon observable artifacts. Examples include rites and ceremonies, stories and sayings, symbols, organizational structures, power relationships, power relationships and control systems. (389)

Power Relationships Symbols Rites and Ceremonies Culture Control Systems (389) Stories and Sayings Organization Structures

Adaptability Culture – Characterized by strategic focus on the external environment through flexibility and change to meet customer needs. Google, Zappos (394) Mission Culture – Emphasis on a clear vision of the organization’s purpose and on the achievement of goals, such as sales growth, profitability, or market share, to help achieve the purpose. Anheuser- Busch InBev (395)

Clan Culture – Primary focus on the involvement and participation of the organization’s members and on rapidly changing expectations from the external environment. In a clan culture, an important value is taking care of employees and making sure they have whatever they need to help them be satisfied as well as productive. UKRD commercial radio station in England is an example. Bureaucratic Culture – has an internal focus and a consistency orientation for a stable environment. This type of culture supports a methodical approach to doing business. Symbols, heroes and ceremonies reinforce the values of cooperation, tradition and following established policies. SAS Institute and Pacific Edge Software use some of the elements of a bureaucratic culture. ( )

Culture and Performance Creating and influencing a constructive culture is one of a leader’s most important jobs. The right culture can drive high performance. (398)

Ethical Values and Social Responsibility A recent study by the Ethics Resource Center indicates that 41 percent of the 6,400 U.S. employees surveyed say they have observed wrongdoing at work. The really bad news, though, is that 60 percent of the ethical violations were by someone with managerial authority. Other countries have had similar problems. Ethics refers to the code of moral principles and values that governs the behaviors of a person or group with respect to what is right or wrong. Ethical values set standards as to what is good or bad in conduct and decision making. (Be familiar with Exhibit 10.5 on page 400!) (400)

The notion of Corporate Social Responsibility (CSR) is an extension of the idea of managerial ethics and refers to management’s obligation to make choices and take action so that the organization contributes to the welfare and interest of all organizational stakeholders, such as employees, customers, shareholders, the community and the broader society. (See MAS Holdings in middle of page 403) (403)

Conscious Capitalism Also referred to as a shared value approach, refers to organizational policies and practices that both enhance the economic success of a company and advance the economic and social conditions of the communities in which the company operates. (403)

There seems to be a positive relationship between ethical and socially responsible behavior and financial results. There is also evidence that people prefer to work for companies that demonstrate a high level of ethics and corporate social responsibility, so these companies can attract and retain high- quality employees. (405)

A survey of year-olds found that 79% say they want to work for a company that cares about how it affects or contributes to society. In a study of ethics policy and practice in successful companies such as J&J and General Mills, no point emerged more clearly than the role of top management in providing commitment, leadership and examples for ethical behavior.

Values-based Leadership Organizational values are developed and strengthened primarily through values-based leadership, a relationship between a leader and followers that is based upon shared, strongly internalized values that are advocated and acted upon by the leader. Employees learn about values, beliefs and goals from watching managers, just as students learn which topics are important for an exam, what professors like and how to get a good grade from watching professors. Values-based leaders “walk their talk”!!! (Costco) ( )

Chuck Williams, Sonoma-Williams Company Nordstrom Department Stores General Norman Schwarzkopf once said, “Leadership is a combination of strategy and character. If you must be without one, be without the strategy.” (407)

Interpersonal Behaviors Treat people with care Be helpful and kind Support others Maintain positive relationships Personal Actions and Expectations Hold self to high ethical standards. Strive for honesty, humility, integrity. Accept responsibility for ethical failings. Fairness with Others Treat everyone equitably Never be condescending Accept others’ mistakes Organizational Leadership Articulate and communicate ethical vision Hold people accountable Put ethics above short-term interests Values- Based Leadership (408)

Who (or what) a person is (character, integrity) will ultimately determine if their brains, talents, competencies, energy, effort, alliance-building abilities, and opportunities will succeed.

Code of Ethics Formal statement of the company’s values concerning ethics and social responsibility; it clarifies to employees what the company stands for and its expectations for employee conduct. (409)

Whistle-blower. Tell me about it! What is it? Who does it? Why are companies trying to protect them? When safe-guards are not in place, what happens to a whistle-blower? (409)

MGT 4153 Chapter 11

24 Innovate or Fail

Four Areas for Change Long25 Technology – Changes in production process Products and Services – Changes in outputs Strategy and Structure – Administrative changes Culture – Changes in values, attitudes, behaviors (424)

Elements for Successful Change Long26 Environment Suppliers Professional Associations Consultants Research literature Suppliers Professional Associations Consultants Research literature Customers Competition Legislation Regulation Labor force Customers Competition Legislation Regulation Labor force 1. Ideas 2. Needs 3. Adoption 4.Implementation 5. Resources Internal Creativity and Inventions Internal Creativity and Inventions Perceived Problems or Opportunities Perceived Problems or Opportunities Organization (427

New Product Success Rate Long27 Enormous uncertainty in development of new products; RCA’s VideoDisc – Lost $500 million Time, Inc.’s TV-Cable Week lost $47 million Pfizer invested 70+ million, anti-aging drug, flopped in final testing 5,000 new food items each year, failure is 70-80% 100 Ideas (by Product Dev. and Management Assoc.) 33 developed projects 28 pass all testing 24 fully commercialized 14 succeed in marketplace (436)

Horizontal Linkage Model for New Product Innovations Specialization, Boundary Spanning, Horizontal Coordination Long28 Environment Technical Development Technical Development Environment Customer Needs Customer Needs Organization General Manager General Manager R&D Marketing Production Linkage

Dual-Core Approach to Organization Change 29 Type of Innovation Desired Administrative Structure Technology Direction of Change: Top-Down Bottom-Up Examples of Change: Strategy Production Downsizing techniques Structure Workflow Best Organizational Design for Change: Mechanistic Organic (444) Administrative Core Technical Core

Culture Change Long30 Reengineering and Horizontal Organization Diversity The Learning Organization

OD Culture Change Interventions Long31 Large Group Intervention Team Building Interdepartmental Activities

Barriers to Change Long32 Excessive focus on costs Failure to perceive benefits Lack of coordination and cooperation Uncertainty avoidance Fear of loss

Techniques for Change Long33 Establish a sense of urgency for change. Establish a coalition to guide the change. Create a vision and strategy for change. Find an idea that fits the need. Develop plans to overcome resistance. Create change teams. Foster idea champions.

Who Moved My Cheese

“Life is no straight and easy corridor along Which we travel free and unhampered, But a maze of passages Through which we must seek our way, Lost and confused in a blind alley.

Who Moved My Cheese But always, if we have faith, A door will open for us, Not perhaps one that we ourselves Would ever have thought of, But one that will ultimately Prove good for us.” (A. J. Cronin)

Who Moved My Cheese Characters: Sniff Scurry Hem Haw

Who Moved My Cheese A Gathering in Chicago Angela-Most Popular Nathan-Family Business Carlos-Football Captain Michael-Story Teller

Who Moved My Cheese-1 Having Cheese Makes You Happy

Who Moved My Cheese-2 The More Important Your Cheese Is To You The More You Want To Hold On To It

Who Moved My Cheese-3 If You Do Not Change, You Can Become Extinct

Who Moved My Cheese-4 What Would You Do If You Weren’t Afraid?

Who Moved My Cheese-5 Smell The Cheese Often So You Know When It Is Getting Old

Who Moved My Cheese-6 Movement In A New Direction Helps You Find New Cheese

Who Moved My Cheese-7 When You Move Beyond Your Fear, You Feel Free

Who Moved My Cheese-8 Imagining Myself Enjoying New Cheese Even Before I Find It Leads Me To It

Who Moved My Cheese-9 The Quicker You Let Go Of Old Cheese, The Sooner You Find New Cheese

Who Moved My Cheese-10 It Is Safer To Search In The Maze Than Remain In A Cheese-less Situation

Who Moved My Cheese-11 Old Beliefs Do Not Lead You To New Cheese

Who Moved My Cheese-12 When You See That You Can Find And Enjoy New Cheese, You Change Course

Who Moved My Cheese-13 Noticing Small Changes Early Helps You Adapt To The Bigger Changes That Are to Come

Who Moved My Cheese Change Happens (They Keep Moving The Cheese) Anticipate Change (Get Ready For The Cheese To Move) Monitor Change (Smell The Cheese Often So You Know When It Is Getting Old) Adapt To Change Quickly (The Quicker You Let Go Of Old Cheese, The Sooner You Can Enjoy New Cheese)

Who Moved My Cheese Change (Move With The Cheese) Enjoy Change! (Savor The Adventure And Enjoy The Taste Of New Cheese!) Be Ready To Change Quickly And Enjoy It Again & Again (They Keep Moving The Cheese)

Who Moved My Cheese Move With The Cheese And Enjoy It!

Who Moved My Cheese Feed-back about story? Who are you in the story? Why? Apply it to your position in your organization. How many of you are afraid of change? How many think others are afraid of change? Did Hem ever change and find new cheese?

Who Moved My Cheese Can “cheese” be old behavior? Instead of changing jobs, maybe we should be changing the way we are “doing” our jobs? Idea: Instead of complaining, what about saying, “They just moved our cheese. Let us look for New Cheese”!