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Chapter Learning Objectives Chapter Learning Objectives After studying this chapter, you should be able to:
– Define organizational culture and describe its common characteristics.
– Compare the functional and dysfunctional effects of organizational culture on people and the organization.
– Identify the factors that create and sustain an organization’s culture.
– Show how culture is transmitted to employees.
– Demonstrate how an ethical culture can be created.
– Describe a positive organizational culture.
– Identify characteristics of a spiritual culture.
– Show how national culture may affect the way organizational culture is transported to a different country.
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ORGANISATIONAL CULTUREORGANISATIONAL CULTURE
Culture is the soul of the organization — the beliefs and values, and how they are manifested.
A common perception held by the organization’s members; a system of shared meaning
The beliefs, values and norms tell people: “What is to be done.” “How it is to be done.” The culture determines the type of leadership,
communication, and group dynamics within the organization.
Organizational Culture –(What)Organizational Culture –(What)
Organizational Culture– A common perception held by the organization’s members; a
system of shared meaning– Seven primary characteristics
1. Innovation and risk taking-Microsoft, google2. Attention to detail3. Outcome orientation4. People orientation5. Team orientation6. Aggressiveness7. Stability
SEE E X H I B I T 16-1SEE E X H I B I T 16-1
16-3
What Do Cultures Do? (Why)What Do Cultures Do? (Why)
Culture’s Functions
1. Defines the boundary between one organization and others
2. Conveys a sense of identity for its members
3. Facilitates the generation of commitment to something larger than self-interest
4. Enhances the stability of the social system
5. Serves as a sense-making and control mechanism for fitting employees in the organization
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How Culture BeginsHow Culture Begins
Stems from the actions of the founders:
– Founders hire and keep only employees who think and feel the same way they do.
– Founders indoctrinate and socialize these employees to their way of thinking and feeling.
– The founders’ own behavior acts as a role model that encourages employees to identify with them and thereby internalize their beliefs, values, and assumptions.
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How Employees Learn CultureHow Employees Learn Culture
Stories– Anchor the present into the past and provide explanations
and legitimacy for current practices
Rituals– Repetitive sequences of activities that express and reinforce
the key values of the organization
Material Symbols– Acceptable attire, office size, opulence of the office
furnishings, and executive perks that convey to employees who are important in the organization
Language– Jargon and special ways of expressing one’s self to indicate
membership in the organization
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Types of Organization culture Types of Organization culture Dominant Culture-Expresses the core values that are shared by a
majority of the organization’s members
Sub –Culture-Minicultures within an organization, typically defined by department designations and geographical separation
Clan culture
Bureaucratic/Hierarchy culture
Adhocracy culture
Market culture
The Impact of Culture on OrganizationsThe Impact of Culture on Organizations
Impact of Positive culture Shared values and
beliefs create a setting in which people are committed to one another and share an overriding sense of mission.
Organization Goals are achieved on time
Employees Support and help each other
Friendly environment due to healthy work culture
Impact Of Negative culture A strong culture can cause
a resistance to change
Not accomplishing targets on time
Employees work individually
Employees blame each other
Ego Clashes
Culture as a LiabilityCulture as a Liability
Institutionalization– A company can become institutionalized where it is valued
for itself and not for the goods and services it provides
Barrier to change– Occurs when culture’s values are not aligned with the values
necessary for rapid change
Barrier to diversity– Strong cultures put considerable pressure on employees to
conform, which may lead to institutionalized bias
Barrier to acquisitions and mergers– Incompatible cultures can destroy an otherwise successful
merger
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Keeping a Culture AliveKeeping a Culture Alive
Three forces play a particularly important role in sustaining a culture:
Selection– Identify and select individuals who are high performers and
whose values are consistent with at least a good portion of the organization’s values
Top Management– Through words and behaviors, senior executives establish
norms that filter through the organization
Socialization– The process that helps new employees adapt to the
prevailing organizational culture
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Socialization Program OptionsSocialization Program Options
Choose the appropriate alternatives:– Formal versus Informal
– Individual versus Collective
– Fixed versus Variable
– Serial versus Random
– Investiture versus Divestiture
Socialization outcomes:– Higher productivity
– Greater commitment
– Lower turnover
SEE E X H I B I T 16-3SEE E X H I B I T 16-3
16-14
Source: 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 1990, p. 116.
Stages in the Socialization ProcessStages in the Socialization Process Prearrival
– The period of learning prior to a new employee joining the organization
Encounter– The stage at which the new employee sees what the organization is
really like and confronts the possibility that expectations and reality may diverge
Metamorphosis – The stage at which the new employee changes and adjusts to the
work, work group, and organization
E X H I B I T 16-2E X H I B I T 16-2
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Summary: How Organizational Cultures FormSummary: How Organizational Cultures Form
Organizational cultures are derived from the founder They are sustained through the selection process,
managerial action, and socialization methods
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E X H I B I T 16-4E X H I B I T 16-4
Creating an Ethical Organizational CultureCreating an Ethical Organizational Culture
Characteristics of Organizations that Develop High Ethical Standards– Has high tolerance for risk
– Low to moderate in aggressiveness
– Focused on means as well as outcomes
Managerial Practices Promoting an Ethical Culture– Being a visible role model
– Communicating ethical expectations
– Providing ethical training
– Visibly rewarding ethical acts and punishing unethical ones
– Providing protective mechanisms
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Creating a Positive Organizational CultureCreating a Positive Organizational Culture
Positive Organizational Culture– A culture that:
• Builds on employee strengths
– Focus is on discovering, sharing, and building on the strengths of individual employees
• Rewards more than it punishes
– Articulating praise and “catching employees doing something right”
• Emphasizes individual vitality and growth
– Helping employees learn and grow in their jobs and careers
Limits of Positive Culture:– May not work for all organizations or everyone within them
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Spirituality and Organizational CultureSpirituality and Organizational Culture
Workplace Spirituality– Recognizes that people have an
inner life that nourishes and is nourished by meaningful work in the context of the community
– NOT about organized religious practices
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Global ImplicationsGlobal Implications
Organizational cultures, while strong, can’t ignore local culture
Managers should be more culturally sensitive by:– Adjusting speech to cultural norms
– Listening more
– Avoiding discussions of controversial topics
All global firms need to be more culturally sensitive
16-20
Summary and Managerial ImplicationsSummary and Managerial Implications
Strong cultures are difficult for managers to change– Strong cultures tend to be stable over time
Selecting new hires that fit well in the organizational culture is critical for motivation, job satisfaction, commitment, and a low turnover
Socialization into the corporate culture is important As a manager, your actions as a role model help create
the cultural values of ethics, spirituality, and a positive culture
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