Chapter Revised

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Is the aggregate of beliefs, norms,attitudes, values, assumptions, and waysof doing things that is shared by

members of an organization and taughtto new members

Gives meaning to each individualsmembership in the workplace and, in so

doing, defines the organizations essentialpurpose

Is recognized as a source of competitive

advantage

Culture


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A deeply rooted culture that is well matched tostrategy and external environmental trends is astrong recipe for successful strategy execution

A weak or shallow-root culture can become anobstacle to successful strategy execution

Culture serves two important functions inorganizations: It creates internal unity

It helps the organization adapt to the externalenvironment

The Power of Culture


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Internal unity Organizational culture defines a normative

order that serves as a source of consistent

behavior within the organization Provides organizational members with a way of

making sense of their daily lives

Establishes guidelines and rules for how to behave

Provides a system of informal rules and peer

pressures Provides a value system in which to operate

Promotes strong employee identification with theorganizations vision, mission, goals, and strategy

Provides a shared understanding about the identityof an organization

The Power of Culture (cont.)


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External adaptation Culture determines how the organization

responds to changes in its external

environment The appropriate culture type can ensure that

an organization responds quickly to rapidlychanging customer needs or the offensiveactions of a competitor

The Power of Culture (cont.)


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The strength of any culture depends onthe degree to which a set of norms andvalues are widely shared and strongly

held throughout the organization A weak culture symbolizes a lack of

agreement on key values and norms

A strong culture symbolizes widespread

consensus

Low- and High-PerformanceCultures


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Insular thinking

Resistance to change

Politicized internal environment

Unhealthy promotion practices

Characteristics ofLow-Performance Cultures


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Culture reinforcement tools Ceremonies highlight dramatic examples of

what the company values, recognize and

celebrate high-performing employees, andhelp create an emotional bond among allemployees

Intensely people oriented

Results oriented Emphasis on achievement and excellence

Characteristics ofHigh-Performance Cultures


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Making sure an organizations culture isaligned with its strategies is among themost challenging responsibilities of

leadership To build and maintain a strong culture,

senior managers must have a clearlydefined vision, mission, and culture

statements that define the way thingsare done

Culture Creation and

Sustainability


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Leaders serving as role models

Celebrating achievements

Interacting face-to-face with rank-and-

file Matching organizational structure to

culture

Matching HR practices to culture Matching operating policies and practices

to culture

Creating a strategyculture fit

Symbolic Leadership Actionsfor Shaping Culture


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CompetitiveCulture

BureaucraticCulture

StrategicFocus

Source: Based on M. D. Youngblood, Winning Cultures for the New Economy, Strategy and Leadership 28, 6(Nov/Dec. 2000): 49; G. N. Chandler, C. Keller, and D. W. Lyon, Unraveling the Determinants and Consequencesof an InnovativeSupportive Organizational Culture,Entrepreneurship Theory and Practices 25, 1 (Fall 2000): 5976; J. R. Fisher, Jr. Envisioning a Culture of Contribution,Journal of Organizational Excellence 20, 1 (Winter

2000): 4752.

External

Internal

Stable Dynamic

Degree of Environmental Turbulence

CompetitiveCulture

AdaptiveCulture

Cooperative

CultureBureaucratic

Culture

Types of OrganizationalCultures


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Cultural Value Types Cooperative culture

Represents a leadership belief in strong, mutuallyreinforcing exchanges and linkages betweenemployees and departments

Operating policies, procedures, standards, and tasksare all designed to encourage cooperation, teamwork,power sharing, and camaraderie among employees

Management thinking is predicated on the belief thatorganizational success is influenced more by employee

relationships inside the organization than by externalrelationships

Employees are trained to think like owners rather thanhired hands


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Cultural Value Types (cont.) Adaptive culture

Represents a leadership belief in active monitoring ofthe external environment for emerging opportunitiesand threats

Made up of policies, procedures, and practices thatsupport employees ability to respond quickly tochanging environmental conditions

Members are encouraged to take risks, experiment,and innovate

Management thinking is based on the belief thatorganizational success is influenced more by eventsoutside the organization than by internal factors

Employees are empowered to make decisions and actquickly to take advantage of emerging opportunities or

avoid threats


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Cultural Value Types (cont.)

Bureaucratic culture Represents a leadership that values order,

stability, status, and efficiency

Leaders perceive their environments asbasically stable with an internal strategic focus

Emphasizes strict adherence to set rules,policies, and procedures

Are highly structured and efficiency driven


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How to Sustain anOrganizations Culture

Define a strategic plan for implementingthe company culture

Use well-trained and experienced

employees to train new hires Make sure that employees at all levels

know what the culture is and accept it

Institute a system by which newemployees learn the written andunwritten parameters of the culture


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Valuesare generalized beliefs andbehaviors that are considered by anindividual or group to be important

A leaders decisions and actions reflecthis or her personal values and beliefs

Integrity and strong values are vital traitsof good leaders

Values-based leadership is about courageand character

Values-Based Leadership


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How leaders ethical values influencefollower behavior and performance is thesubject of values-based leadership

The leaders values and behaviors aresignificantly related to the values andbehaviors of subordinates Followers take their cue from the leader

Values-Based Leadership(cont.)


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Some of the tools available for leaders touse in enforcing ethical behavior include: Codes of ethics

Ethics committees Training programs

Disclosure mechanisms Whistle blowing

The Leaders Role inAdvocating Ethical Standards


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A nations values and norms determine whatkinds of attitudes and behaviors are acceptable orappropriate

The people of a particular culture are socializedinto national values as they grow up

Norms and social guidelines prescribe howmembers of a nation should behave toward eachother

Significant differences between national culturesexist and make a difference in how leaders andemployees behave in organizations

National Culture IdentitiesHofstedes Value Dimensions


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Source: Based on G. Hofstede, Cultural Constraints in Management Theories,Academy ofManagementExecutive (1993), pp. 8194.

Collectivism

HighUncertaintyAvoidance

HighPower

Distance

Long-termOrientation

Femininity

Masculinity

Short-term

Orientation

Low

PowerDistance

Low

UncertaintyAvoidance

Individualism

for Understanding Cultural

Differences


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Individualism is a psychological state in which people seethemselves first as individuals and believe their owninterest and values are primary Examples:

United States

Great Britain

Canada

Collectivism is the state of mind wherein the values andgoals of the groupwhether extended family, ethnicgroup, or companyare primary Examples:

Greece

Japan

Mexico

Individualistic to CollectivistCultures


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A society with high uncertainty avoidance contains amajority of people who do not tolerate risk, avoid theunknown, and are comfortable when the future isrelatively predictable and certain Examples:

United States

Australia

Canada

A society where the majority of the people have lowuncertainty avoidance has people who are comfortable

with and accepting the unknown, and tolerate risk andunpredictability Examples:

Italy

Japan

Israel

High to Low UncertaintyAvoidance Cultures


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In a high power-distance culture, leaders andfollowers rarely interact as equals Examples:

Mexico

Spain Japan

France

In a low power-distance culture, leaders and their

members interact on several levels as equals Examples: Germany

United States

Ireland

High to LowPower-Distance Cultures


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People from a culture with a long-termorientation have a future-oriented view of lifeand thus are thrifty and persistent in achievinggoals Examples:

Most Asian countries

A short-term orientation derives from values thatexpress a concern for maintaining personal

happiness and living for the present Examples:

Most European countries

United States

Long-Term to Short-TermOriented Cultures


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Masculinity describes a culture that emphasizesassertiveness and a competitive drive for moneyand material objects Examples:

Japan Italy

Femininity describes a culture that emphasizesdeveloping and nurturing personal relationships

and a high quality of life Examples:

Sweden

Denmark

MasculinityFemininity


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The growing diversity of the workforce and theincreasing globalization of the marketplace createthe need for leaders with multiculturalbackgrounds and experiences

Multicultural leaders possess competencies thatenable them to relate effectively to and motivatepeople across race, gender, age, social strata,and nationality

Cross-cultural and international joint venture(IJV) studies often identify cultural differences asthe cause of many interpersonal difficulties,including conflict and poor performance

Implications for LeadershipPractice


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Demographic diversity Is any characteristic that serves as a basis for social

categorization and self-identification

Includes:

Race Gender

Age

Ethnicity

Religion

Sexual orientation

Diversity Is the inclusion of all groups at all levels in an

organization

Changing Demographicsand Diversity


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Generational diversity in the workplace Traditionalists (19001945)

Baby Boomers (19461964)

Generation Xers (19651980) Millennials (19812000)

Changing Demographicsand Diversity (cont.)


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The most significant increase in workforcediversity is due to: National demographic changes

Greater minority representation in the workforce

A greater likelihood exists that individuals willfind themselves leading or under the leadershipof someone demographically different from them

In the new work environment, workers must

often share work duties and space with coworkersof diverse races, social backgrounds, and cultures

Current State of WorkforceDiversity


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In the last 25 years, attitudes toward diversityhave and continue to change

Companies that can effectively manage diversitywill be able to recruit from a larger pool, train

and retrain superior performers, and maximizethe benefits of this diverse workforce

More organizations are highlighting diversity intheir advertising, because they are competing for

talent in a tight labor market They recognize that demographic shifts are going

to dramatically change their marketplace over thenext 20 years

Current State ofWorkforce Diversity (cont.)

R f E b i


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Can offer a company a marketingadvantage

Can help a company to develop and

retain talented people Can be cost effective

May provide a broader and deeper base

of creative problem solving and decisionmaking

Reasons for EmbracingDiversity


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Despite its benefits, negative outcomescan result if diversity is not effectivelymanaged

Left unmanaged, workforce diversity ismore likely to: Damage morale

Increase turnover

Cause communication problems

Ultimately cause conflict

The Downside of Diversity

Ob t l t A hi i


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Stereotypes and prejudice Prejudice is the tendency to form an adverse

opinion without just cause about people whoare different from the mainstream in terms oftheir gender, race, ethnicity, or any otherdefinable characteristic

It is an assumption, without evidence, thatpeople who are not part of the mainstream

culture (women, African Americans, and otherminorities) are: Inherently inferior

Less competent at their jobs

Less suitable for leadership positions

Obstacles to AchievingDiversity

b l hi i


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Ethnocentrism Is the belief that ones own group or

subculture is naturally superior to othergroups and cultures

Produces a homogeneous culture

Policies and practices

The glass ceiling Is an invisible barrier that separates women

and minorities from top leadership positions

Remains a pervasive problem in corporateAmerica

Obstacles to AchievingDiversity (cont.)

Ob l hi i


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Unfriendly work environment Sexual harassment, intimidation, bullying,

and social rejection are all examples ofactions that make the workplace unfriendly

Making the workplace friendly for everyonewill go a long way toward alleviating theproblem of high turnover and preservediversity initiatives

Obstacles to AchievingDiversity (cont.)

C i C l Th


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For organizations to embrace and value diversity,the concept itself must be embedded in theorganizations business model

When diversity leadership becomes part of the

organizations mission, all employees are givenequal opportunities to contribute their talents,skills, and expertise toward achievingorganizational objectives

Leaders have a responsibility to create a workculture that accommodates the needs of adiverse workforce

Creating a Culture ThatSupports Diversity

F t R l t d t Di it


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Corporate philosophy

Culture of DiversityIncluding

diversity asa criterion for

measuring

successPro-diversity

HRpractices

Organizationalcommunications on

diversity

Top managementsupport and commitment

Factors Related to DiversitySuccess

Source: Based on J. A. Gilbert and J. M. Ivancevich, Valuing Diversity: A Tale of Two Organizations,Academy ofManagement Executive 14(1) (2000): 93105.

Di it A T i i


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The ultimate objective of diversitytraining and education is to create adiversity sensitive orientation (DSO)

within the entire workforce

Diversity Awareness Trainingand Leadership Education

d L d hi Ed ti


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Diversity training Training sessions are aimed at increasing

peoples awareness of and empathy forpeople from different cultures andbackgrounds

Diversity training can include: Role-playing

Self-awareness activities

Awareness activities

Training programs can last hours or days

and Leadership Education(cont.)

d L d hi Ed ti


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Education Additional education is sometimes needed for

leaders beyond diversity training

Leaders develop personal characteristics tomake them better able to communicate andwork with diverse employees

Leaders are taught to view diversity in thelarger context of the organizations long-termvision

They should be educated on the strategicsignificance of linking diversity to theorganizations competitiveness

and Leadership Education(cont.)

Documents

Chapter Revised