1. Organisational Culture
Chapter 14
Organisational Culture

2. Learning Objectives
14.1 Describe the elements of organisational culture and discuss the importance of organisational subcultures
14.2 List four categories of artefacts through which corporate culture is deciphered
14.3 Discuss the importance of organisational culture and the conditions under which organisational culture strength improves organisational performance
14.4 Compare and contrast four strategies for merging organisational cultures
14.5 Identify four strategies for changing or strengthening an organisation’s culture, including the application of attraction-selection-attrition theory.
14.6 Describe the organisational socialisation process and identify strategies to improve that process

3. Wesfarmers’ Organisational Culture
Wesfarmers’ award-winning corporate culture has helped Coles to become a serious competitor in the retail food business

4. Organisational Culture Defined
The basic pattern of shared values and assumptions shared within the organisation
Defines what is important and unimportant
Company’s DNA—invisible, yet powerful template that shapes employee behaviour

5. Elements of Organisational Culture
Artifacts of organisational culture
Organisational culture

6. Content of Organisational Culture
The relative ordering of values
A few dominant values
Example: Wesfarmers—integrity, openness, boldness and accountability.
Problems measuring organisational culture
Oversimplifies diversity of possible values
Ignores shared assumptions
Adopts an ‘integration’ perspective
An organisation’s culture is fuzzy:
Diverse subcultures (‘fragmentation’)
Values exist within individuals, not work units

7. Organisational Culture Profile
Org Culture Dimensions
Dimension Characteristics
Innovation
Experimenting, opportunity seeking, risk taking, few rules, low cautiousness
Stability
Predictability, security, rule-oriented
Respect for people
Fairness, tolerance
Outcome orientation
Action oriented, high expectations, results oriented
Attention to detail
Precise, analytic
Team orientation
Collaboration, people-oriented
Aggressiveness
Competitive, low emphasis on social responsibility
Source: O’Reilly et al (1991)

8. Organisational Subcultures
Dominant culture—most widely shared values and assumptions
Subcultures
Located throughout the organisation
Can enhance or oppose (countercultures) firm’s dominant culture
Two functions of countercultures:
Provide surveillance and critique, ethics
Source of emerging values

9. Artefacts of Organisational Culture
Observable symbols and signs of culture
Physical structures, ceremonies, language, stories
Maintain and transmit organisation’s culture
Need many artefacts to accurately decipher a company’s culture

10. Artefacts: Stories and Legends
Social prescriptions of desired (or dysfunctional) behaviour
Provides a realistic human side to expectations
Most effective stories and legends:
Describe real people
Assumed to be true
Known throughout the organisation
Are prescriptive

11. Artefacts: Rituals and Ceremonies
Programmed routines (e.g. how visitors are greeted)
Ceremonies
Planned activities for an audience (e.g. award ceremonies)

12. Artefacts: Organisational Language
Words used to address people, describe customers, etc.
Leaders use phrases and special vocabulary as cultural symbols
Language also found in subcultures

13. Artefacts: Physical Structures and Symbols
Building structure—may shape and reflect culture
Office design conveys cultural meaning
Furniture, office size, wall hangings

14. Organisational Culture Strength
How widely and deeply employees hold the company’s dominant values and assumptions
Strong cultures exist when:
Most employees understand/embrace the dominant values
Values and assumptions are institutionalised through well-established artefacts
Culture is long lasting—often traced back to founder

15. Functions of Strong Corporate Cultures

16. Contingencies of Organisational Culture and Performance
Organisational culture strength moderately predicts organisational performance
Need to consider contingencies:
Ensure culture-environment fit
Avoid corporate ‘cult’ strength
Create an adaptive culture

17. News Corporation’s ‘Whatever it Takes’ Culture
According to various observers and government officials, Rupert Murdoch’s powerful media empire has a ‘whatever it takes’ corporate culture that has tacitly encouraged staff to cross ethical and legal boundaries

18. Organisational Culture and Ethics
Ethical values become embedded in an organisation’s dominant culture
To create a more ethical organisation, leaders need to work on the embedded culture that steers employee behaviour

19. Merging Cultures: Bicultural Audit
Part of due diligence in merger
Minimises cultural collision by diagnosing companies
Three steps in bicultural audit:
Identify cultural artefacts
Analyse data for cultural conflict or compatibility
Identify strategies and action plans to bridge cultures

20. Merging Organisational Cultures
Assimilation
Acquired company embraces acquiring firm’s cultural values
Deculturation
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

21. Changing/Strengthening Organisational Culture

22. Changing/Strengthening Organisational Culture continued
Actions of founders/leaders
Organisational culture sometimes reflects the founder’s personality
Transformational leaders can reshape culture— organisational change practices
Aligning artefacts
Artefacts keep culture in place
e.g. create memorable events, communicating stories, transferring culture carriers

23. Changing/Strengthening Organisational Culture continued
Introducing culturally consistent rewards
Rewards are powerful artefacts—reinforce culturally-consistent behaviour
Attracting, selecting, socialising employees
Attraction-selection-attrition theory
Socialisation practices

24. Attraction-Selection-Attrition Theory
Organisations become more homogeneous (stronger culture) through:
Attraction: applicants self-select and weed out companies based on compatible values
Selection: applicants selected based on values congruent with organisation’s culture
Attrition: employees quit or are forced out when their values oppose company values

25. Organisational Socialisation Defined
The process by which individuals learn the values, expected behaviours and social knowledge necessary to assume their roles in the organisation

26. Socialisation: Learning and Adjustment
Learning process
Newcomers make sense of the organisation’s physical, social and strategic/cultural dynamics
Adjustment process
Newcomers need to adapt to their new work environment
New work roles
New team norms
Newcomers with diverse experience adjust better

27. Stages of Socialisation

28. Facebook’s Landing Teams
Facebook instils its unique corporate culture at new sites by parachuting in a ‘Landing Team’ of current employees. The Landing Team carefully selects applicants for their compatibility with Facebook’s culture and coaches newcomers on the Facebook way of life

29. Improving Organisational Socialisation
Realistic job preview (RJP)
A balance of positive and negative information about the job and work context
Socialisation agents
Supervisors: technical information, performance feedback, job duties
Co-workers: ideal when accessible, role models, tolerant and supportive

30. Organisational Culture
Chapter 14
Organisational Culture