Chapter 15 Organizational Culture

What Is Organizational Culture? The norms, values, beliefs, assumptions, shared mental models, etc., held by the organization’s members; a system of shared meaning. Sample Culture Bases: Innovative and risk-taking Attentive to detail Outcome orientated People orientated Team orientated Aggressive, competitive Stable, predictable

Culture and Performance Culture impacts performance via: Social control, generates commitment to something larger than “self” Social glue and stability, sense of identity Sense-making: Reduces confusion (especially with diversity)

Elements of Org. Culture Espoused Culture vs. Enacted Culture? Stories (Heroes) Language/Usage Rules & Policies Physical Structures Rituals/Ceremonies Norms Beliefs Values Assumptions Mental Models Artifacts of Culture Core of Culture

How Employees Learn Culture? Stories Rituals Material Symbols Language

How are organizational cultures created and maintained? Founding leaders, legends, histories Subsequent leadership influence: What’s rewarded and punished? Where are budgets allocated? Who’s hired, how are they socialized? Member exchanges and interactions Stability of workforce Kluckhon and Strodbeck propose that cultures differ in terms of how they approach six basic dimensions. First, cultures differ in their relationship to nature. Some see nature as a force, but others see it as an obstacle to master. Second, cultures differ in their time orientation. Some focus on the past and traditions; some stress the present, the short-term; some look to the future, the long-term. The third difference concerns views of human nature--whether people are basically good, evil, or neutral. The fourth dimension, activity orientation, concerns the degree to which people within a culture are proactive, reactive, or controlling. The fifth dimension pertains to relationships among people. Some cultures focus on individual achievements and performance; some emphasize group harmony and performance; some view social relationships as hierarchical and based on well-established rank and order. The last dimension deals with views of personal space. In some cultures privacy and ownership of personal space are valued; in others, space is commonly shared. Many cultures fall in the middle, with a combination of public and private views of space. 7

Keeping Culture Alive Top Management: Selection (when hiring): Managers establish norms that permeate the company; this happens as they reward and/or punish different behaviors, establish rules and policies, emphasize stories and rituals, set company budgets and priorities, and so on. Selection (when hiring): Hiring candidates who “fit” into the company. Provides information to candidates about the company (and candidates also choose). Socialization: Helps new employees adapt to the culture.

What else can cultures do? Cultures as liability: Barriers to change Barriers to mergers and acquisitions Barriers to diversity

Creating an Ethical Culture Strong culture High risk tolerance Low-to-moderate aggressiveness Focus on means as well as outcomes Managers must: be visible role models communicate ethical expectations provide ethics training visibly reward ethical and punish unethical acts provide protective mechanisms

Creating a Positive Culture Positive cultures emphasize: Building on employee strengths Rewarding more than punishing Clear and unambiguous reinforced (and consistently lived) community values Emphasizing vitality and growth of the employee: Clear and unambiguous trust