1. Managing Organizational Culture and Change
Chapter 4
Managing Organizational Culture and Change

2. Learning Objectives After reading this chapter, you should be able to:
Identify the three major aspects of organizational culture.
Apply a simple assessment tool to quickly gain a sense of the culture of an organization.
Describe the importance of organizational culture.
Identify the processes through which organizational culture can be developed and sustained.
Use classification systems to identify various types of organizational culture.
Identify the sources of resistance to change.
Apply models to effectively manage change efforts.

3. Organizational Culture
A system of shared values, assumptions, beliefs, and norms that unite the members of an organization.
Reflects employees’ views about “the way things are done around here.”
The culture specific to each firm affects how employees feel and act and the type of employee hired and retained by the company.

4. Levels of Corporate Culture
Visible Culture
Expressed Values
Core Values

5. Key Effects of Organizational Culture
Employee
Self-management
Organizational Culture
Stability
Socialization
Strategy
Implementation

6. Key Effects of Organizational Culture
Employee Self-Management
Sense of shared identity
Facilitates commitment
Stability
Sense of continuity
Satisfies need for predictability, security, and comfort

7. Key Effects of Organizational Culture
Socialization
Internalizing or taking organizational values as one’s own
Implementation Support of the Organization’s Strategy
If strategy and culture reinforce each other, employees find it natural to be committed to the strategy

8. Stages of the Socialization Process
Pre-arrival
Encounter
Metamorphosis

9. Managing Cultural Processes
Company Rituals and Ceremonies
Cultural Symbols
Company Heroes
Stories
Language
Organizational Policies and Decision Making
Leadership

10. Characteristics and Types of Organizational Culture
Cultural Uniformity versus Heterogeneity
Strong versus Weak Cultures
Culture versus Formalization
National versus Organizational Culture

11. Characteristics and Types of Organizational Culture (continued)
Types: Traditional Control or Employee Involvement
Traditional control
emphasizes the chain of command
relies on top-down control and orders
Employee involvement
emphasizes participation and involvement

12. Four Types of Culture Classification
Baseball team culture--rapidly changing environment
Club culture--seeks loyal, committed people
Academy culture--hires experts who are willing to make a slow steady climb up a ladder
Fortress culture--focused on surviving and reversing sagging fortunes

13. Competing Values Framework
Based on two dimensions: focus and control
Focus--whether the primary attention of the organization is directed toward internal dynamics or directed outward toward the external environment
Control--the extent to which the organization is flexible or fixed in how it coordinates and controls activities

14. Artifacts Ceremonies and rites – McDonald’s, award ceremonies
Stories – Dayton-Hudson, Nordstrom
Slogans/mission –
Perot: Eagles don’t flock, gather one at a time
Pepsico: We take eagles and teach them to fly in formation
Symbols – buttons, badges, logos, Stew Leonard

15. Competing Values Framework
Focus
Internal
External
Flexible
Control
Fixed

16. Types of Change
Planned Change--change that is anticipated and allows for advanced preparation
Dynamic Change--change that is ongoing or happens so quickly that the impact on the organization cannot be anticipated and specific preparations cannot be made

17. Forces for Change: Environmental Forces
Put pressure on a firm’s relationships with customers, suppliers, and employees.
Environmental forces include:
Technology
Market forces
Political and regulatory agencies and laws
Social trends

18. Forces for Change: Internal Forces
Arise from events within the company.
May originate with top executives and managers and travel in a top-down direction.
May originate with front-line employees or labor unions and travel in a bottom-up direction.

19. Resistance to Change Self-Interest Cultures that Value Tradition
Lack of Trust and Understanding
Different Perspectives and Goals
Uncertainty 3

20. Models of Organizational Change: The Star Model
The Star Model: Five Points
Types of change-evolutionary or transformational
Structure
Reward system
Processes
People

21. Lewin’s Three-Step Model of Organizational Change
Unfreezing--melting away resistance
Change--departure from the status quo
Refreezing--change becomes routine

22. Lewin’s Force Field Analysis Model
Increase driving forces that drive change
Reduce restraining forces that resist change
or do both

23. Force-field Model of Change
Desired state
Restraining forces
Status quo
Driving forces
Time

24. Implementing Organizational Change
Top-down Change
Change Agents
Bottom-up Change

25. Four Types of Employees
Alignment with culture No
Yes
Performance
Low
Worst
Give Another Chance
High
Make the tough choice
Best

26. Tactics for Introducing Change
Communication and Education
Employee Involvement
Negotiation
Coercion
Top-Management Support