10_langton_ob_4ce_ch10

Chapter 10, Nancy Langton and Stephen P. Robbins, Organizational Behaviour, Fourth Canadian Edition 10-1Copyright © 2007 Pearson Education Canada

Chapter 10

Organizational Culture


Chapter Outline

• What Is Organizational Culture?

• Reading an Organization’s Culture

• Creating and Sustaining Culture

• The Liabilities of Culture

• Changing Organizational Culture



1. What is the purpose of organizational culture?

2. How do you read an organization’s culture?

3. How do you create and maintain culture?

4. Can organizational culture have a downside?

5. How do you change culture?


Henry Mintzberg on Culture

• “Culture is the soul of the organization — the beliefs and values, and how they are manifested. I think of the structure as the skeleton, and as the flesh and blood. And culture is the soul that holds the thing together and gives it life force.”



• The pattern of shared values, beliefs, and assumptions considered to be the appropriate way to think and act within an organization.– Culture is shared.

– Culture helps members solve problems.

– Culture is taught to newcomers.

– Culture strongly influences behaviour.


Exhibit 10-1 Layers of Culture

Artifacts of Organizational

Culture

Material SymbolsLanguage

RitualsStories


BeliefsValues

Assumptions


Levels of Culture

• Artifacts– Aspects of an organization’s culture that you see, hear, and

feel.• Beliefs

– The understandings of how objects and ideas relate to each other.

• Values– The stable, long-lasting beliefs about what is important.

• Assumptions– The taken-for-granted notions of how something should be in

an organization.


Characteristics of Organizational Culture

• Innovation and risk-taking– The degree to which employees are encouraged to be innovative and take

risks.

• Attention to detail– The degree to which employees are expected to exhibit precision,

analysis, and attention to detail.

• Outcome orientation– The degree to which management focuses on results or outcomes rather

than on technique and process.

• People orientation– The degree to which management decisions take into consideration the

effect of outcomes on people within the organization.


Characteristics of Organizational Culture

• Team orientation– The degree to which work activities are organized around teams

rather than individuals.

• Aggressiveness– The degree to which people are aggressive and competitive rather

than easygoing.

• Stability– The degree to which organizational activities emphasize

maintaining the status quo in contrast to growth.


Exhibit 10-2 Contrasting Organizational Cultures

Organization A Organization B

• Managers must fully document

all decisions.

• Creative decisions, change, and risks

are not encouraged.

• Extensive rules and regulations exist

for all employees.

• Productivity is valued over employee

morale.

• Employees are encouraged to stay

within their own department.

• Individual effort is encouraged.

• Management encourages and

rewards risk-taking and change.

• Employees are encouraged to

“ run with ” ideas, and failures are

treated as “ learning experiences.”

• Employees have few rules and

regulations to follow.

• Productivity is balanced with treating

its people right.

• Team members are encouraged to interact

with people at all levels and functions.

• Many rewards are team based.


Culture’s Functions

• Social glue that helps hold an organization together.– Provides appropriate standards for what

employees should say or do.

• Boundary-defining.

• Conveys a sense of identity for organization members.


Culture’s Functions

• Facilitates commitment to something larger than one’s individual self-interest.

• Enhances social system stability.

• Serves as a “sense-making” and control mechanism.– Guides and shapes the attitudes and behaviour of

employees.


Do Organizations Have Uniform Cultures?

• Organizational culture represents a common perception held by the organization members.

• Core values or dominant (primary) values are accepted throughout the organization.– Dominant culture

• Expresses the core values that are shared by a majority of the organization’s members.

– Subcultures • Tend to develop in large organizations to reflect common

problems, situations, or experiences.


Reading an Organization’s Culture

• Stories

• Rituals

• Material Symbols

• Language


Exhibit 10-3 How Organizational Culture Forms

Selectioncriteria

Socialization

Organization'sculture

Philosophyof

organization'sfounders

Topmanagement


Creating and Sustaining Culture: Keeping a Culture Alive

• Selection– Identify and hire individuals who will fit in with the

culture.

• Top Management– Senior executives establish and communicate the norms

of the organization.

• Socialization– Organizations need to teach the culture to new employees.


Exhibit 10-5A Socialization Model

Prearrival Encounter Metamorphosis

Socialization Process Outcomes

Commitment

Productivity

Turnover


Exhibit 10-6 Entry Socialization Options

• Formal vs. Informal

• Individual vs. Collective

• Fixed vs. Variable

• Serial vs. Random

• Investiture vs. DivestitureSources: Based on J. Van Maanen, “People Processing: Strategies of Organizational Socialization,” Organizational Dynamics, Summer 1978, pp. 19-36; and E. H. Schein, “Organizational Culture,” American Psychologist, February 1960, p. 116.


Exhibit 10-7 Four-Culture Typology

Fragmented

Networked

Low

High

Solidarity

Mercenary

Low High

Communal

Soc

iabi

lity

Source: Adapted from R. Goffee and G. Jones, The Character of a Corporation: How Your Company’s Culture Can Make or Break Your Business (New York: HarperBusiness, 1998), p. 21.


The Liabilities of Culture

• Culture can have dysfunctional aspects in some instances.– Culture as a Barrier to Change

• When organization is undergoing change, culture may impede change.

– Culture as a Barrier to Diversity• Strong cultures put considerable pressure on employees to

conform.

– Culture as a Barrier to Mergers and Acquisitions• Merging the cultures of two organizations can be difficult, if not

impossible.


Changing Organizational Culture

1. Have top-management people become positive role models, setting the tone through their behaviour.

2. Create new stories, symbols, and rituals to replace those currently in vogue.

3. Select, promote, and support employees who espouse the new values that are sought.

4. Redesign socialization processes to align with the new values.


Changing Organizational Culture

5. Change the reward system to encourage acceptance of a new set of values.

6. Replace unwritten norms with formal rules and regulations that are tightly enforced.

7. Shake up current subcultures through transfers, job rotation, and/or terminations.

8. Work to get peer group consensus through utilization of employee participation and creation of a climate with a high level of trust.


Summary and Implications

1. What is the purpose of organizational culture?

– Organizational culture provides stability and gives employees a clear understanding of “the way things are done around here.”

2. How do you read an organization’s culture?– Artifacts, such as stories, rituals, material

symbols, and language, can be used to help read an organization’s culture.


Summary and Implications3. How do you create and maintain culture?

– An organization’s culture is derived from the philosophy of its founders. It is communicated by managers and employees are socialized into it.

4. Can organizational culture have a downside?– A strong culture can have a negative effect, including

“pressure-cooker” cultures, barriers to change, difficulty in creating an inclusive environment, and hindering mergers and acquisitions.

5. How do you change culture?– It is important to change the reward structure and to

work carefully to change employee beliefs.


OB at Work


For Review

1. What are the levels of organizational culture?

2. How can an outsider assess an organization’s culture?

3. How is language related to organizational culture?

4. Can an employee survive in an organization if he or she rejects its core values? Explain

5. What defines an organization’s subcultures?


For Review

6. What benefits can socialization provide for the organization? For the new employee?

7. Describe four cultural types and the characteristics of employees who fit best with each.

8. How can culture be a liability to an organization?9. How does a strong culture affect an organization’s

efforts to improve diversity?10. Identify the steps a manager can take to implement

culture change in an organization.


For Critical Thinking

1. Is socialization brainwashing? Explain.

2. If management sought a culture characterized as innovative and autonomous, what might its socialization program look like?

3. Can you identify a set of characteristics that describes your college’s or university’s culture? Compare them with what several of your peers have noted. How closely do they agree?


For Critical Thinking

4. “We should be opposed to the manipulation of individuals for organizational purposes, but a degree of social uniformity enables organizations to work better.” Do you agree or disagree with this statement? What are its implications for organizational culture? Discuss.

5. Today’s workforce is increasingly made up of part-time or contingent employees. Is organizational culture really important if the workforce is mostly temporary employees?


Point-CounterPoint

• Why Culture Doesn’t Change Culture develops over many

years, and becomes part of how the organization thinks and feels.

Selection and promotion policies guarantee survival of culture.

Top management chooses managers who are likely to maintain culture.

• When Culture Can ChangeThere is a dramatic crisis.There is a turnover in

leadership.The organization is young

and small.There is a weak culture.


HR Implications Creating an Ethical Culture

• Be a visible role model. – Senior managers seen to be taking the ethical high road

provide a positive message for all employees.

• Communicate ethical expectations.– Create and distribute an organizational code of ethics.

• Provide ethical training. – Set up seminars, workshops, and similar ethical training

programs.


HR Implications: Creating an Ethical Culture

• Visibly reward ethical acts and punish unethical ones. – Performance appraisals should consider how

decisions and behaviour measure against the organization’s code of ethics.

• Provide protective mechanisms. – Employees need to be able to discuss ethical

dilemmas and report unethical behaviour without fear of punishment.


Breakout Group Exercises

• Form small groups to discuss the following:1. Choose two courses that you are taking this term, ideally in

different faculties, and describe the culture of the classroom in each. What are the similarities and differences? What values about learning might you infer from your observations of culture?

2. Identify artifacts of culture in your current or previous workplace. From these artifacts, would you conclude that the organization had a strong or weak culture?

3. Have you or someone you know worked somewhere where the culture was strong? What was your reaction to that strong culture? Did you like that environment, or would you prefer to work where there is a weaker culture? Why?

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