Organizational Culture

Functions of Organizational Culture

Dimensions of Organizational/Corporate Culture
Sources and Continuation of Organizational Culture
Levels Of Organizational Culture
Types of Artifacts
Types of Cultures
Theories On The Relationship Between Organizational Culture
And Performance
Strengthening/Changing Organizational Culture
Socialization

What Is Organizational Culture?

A pattern of basic assumptions that the group learned as it

solved its problems of external adaptation and internal
integration, that has worked well enough to be considered valid
and, therefore, to be taught to new members as the correct
way to perceive, think and feel in relation to those problems
(Edgar Schein, 1992)

The set of shared values, norms, standards for behavior, and

shared expectations that influence the way in which individuals,
groups, and teams interact with each other and cooperate to
achieve organizational goals.

The basic pattern of shared values and assumptions governing

the way employees within an organization think about and act
on problems and opportunities

Functions of Organizational Culture

Provides a sense of identity to members and increases
their commitment to the organization
Is a sense-making device for organization members
Reinforces the values of the organization
Serves as a control mechanism for shaping behavior
Helps organization adapt to external environment

How Cultures Are Embedded In

Organizations
Formal/public statements
Physical Layout
Slogans, co. logo
Mentoring
Explicit rewards, promotion criteria
Stories, legends, myths
Processes and outcomes measurement
Workflow and systems

Organizational 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
Outcome
orientation
Attention to
detail
Team
orientation
Aggressiveness

Fairness, tolerance
Action oriented, high expectations, results oriented
Precise, analytic

Collaboration, people-oriented
Competitive, low emphasis on social responsibility

Dimensions of Corporate Culture

Relationship
Job - To put the demands of the job before the needs of the Individual
Person - To put the needs of the individual before the demands of the job

Identity
Corporate - To identify with and uphold the expectations of the employing organizations
Professional - To pursue the aims and ideals of each professional practice

Communication
Open - To stimulate and encourage a full and free exchange of information and opinion
Close - To monitor and control the exchange and accessibility of information and opinion

Control
Tight - To comply with clear and definitive systems and procedures.
Loose - To work flexibly and adaptively according to the needs of the situation

Conduct
Conventional - To put the expertise and standards of the employing organization first. To
do what we know is right
Pragmatic - To put the demands and expectations of customer first. To do what they ask

Cultures Effects on Managerial Process

Decision Making (Central/Decentralization)
Safety vs. Risk
Individual vs. Group Rewards
Informal/Formal Procedures
Organizational Loyalty
Co-operation vs. Competition
Time Horizons - Long or Short
Stability vs. Innovation

Culture Strength and

Organizational Subcultures

Culture strength is the degree of agreement among

members of an organization about specific values

Subcultures reflect the common problems, goals, and

experiences of a team or department

Different departments may have their own norms

Sources and Continuation of

Organizational Culture

Sources of Organizational Culture

The organizations founder (vision and mission)
Past practices of the organization (the way things
have been done)
The behavior of top management

Continuation of the Organizational Culture

Recruitment of like-minded employees who fit
Socialization of new employees to help them adapt
to the culture

Levels Of Organizational Culture

Visible, often not
decipherable

Greater level
of awareness

Taken for granted,

Invisible, Preconscious

Types of Artifacts

Personal Enactment
Stories and Legends

About the boss

About getting fired
About relocating
About promotions
About crisis situations
About status considerations

Rituals and Ceremonies

Organizational Language
Symbols (including Physical Structures)

Artifacts: Personal Enactment

Behavior that reflects the organizations values

It may be induced formally (by the management) or
informally (by the members of a group/subgroup)
Includes day-to-day habits and dress codes

Artifacts: Stories and Legends

Social prescriptions of desired (undesired) behavior
Narratives of significant events or actions of people
that convey the spirit of the organization
Provide a realistic human side to expectations
Most effective stories and legends:
Describe real people
Assumed to be true
Known throughout the organization
Are prescriptive

Artifacts: Rituals and Ceremonies

Rituals
Repetitive sequences
of activities that
express and reinforce
the values of the
organization
Programmed routines
(eg., how visitors are
greeted)
Usually have some
emotional content

Ceremonies
Planned activities for
an audience (eg.,
award ceremonies)
More formal than
rituals

Artifacts: Organizational Language

Acronyms and jargon of terms, phrases, and word

meanings specific to an organization
Words used to address people, describe customers, etc.
Leaders use phrases and special vocabulary as cultural
symbols
eg. Referring to clients rather than customers
Language also found in subcultures
eg. Whirlpools PowerPoint culture

Artifacts: Symbols

Building structure - may shape and reflect culture

Office design conveys cultural meaning
Furniture, office size, wall hangings

Courtesy of Microsoft Corp.

Applying The Concept:

Describe the culture of ASE (The Academy of Economic

Studies), as you perceive it , taking into account its
symbols, rituals and ceremonies, stories etc.

Understanding Organizational Culture

Antecedents
Founders values
Industry & business
environment
National culture
Senior leaders
vision and behavior

Organizational
Culture
Observable artifacts
Espoused values

Organizational
Structure &
Practices
Reward systems

Organizational
design

Effectiveness

Innovation &
stress

Socialization
Mentoring
Decision
making
Group
dynamics
Communication

Basic assumptions

Organizational
Outcomes

Group & Social

Processes

Collective
Attitudes &
Behavior
Work attitudes
Job satisfaction
Motivation

Influence &
empowerment
Leadership

Types of Cultures

Constructive
Valuing members, self-actualizing, afiliative, and
humanistic/encouraging normative beliefs (expected behavior or
conduct)

Passive-defensive
Approval-oriented, traditional and bureaucratic, dependent and
non-participative, punish mistakes but ignore success

Aggressive-defensive
Confrontation and negativism are rewarded, nonparticipative,
positional power, winning valued, competitiveness rewarded,
perfectionistic

Constructive Culture
Normative
Beliefs

Organizational
Characteristics

Achievement

Goal and achievement

oriented

Self-actualizing

Value self-development
and creativity

Humanisticencouraging
Affiliative

Participative, employee
centered, and supportive
High priority on constructive interpersonal
relationships, and focus on work group
satisfaction

Passive Defensive Culture

Normative Beliefs

Organizational
Characteristics

Approval

Avoid conflict, strive to be

liked by others, and
approval oriented

Conventional

Conservative, bureaucratic,
and people follow the rules

Dependent

Nonparticipative, centralized decision

making, and employees do what they are
told
Negative reward system and Defensive
avoid accountability

Avoidance

Aggressive-Defensive Culture
Normative Beliefs

Organizational
Characteristics

Oppositional

Confrontation and
negativism rewarded

Power

Nonparticipative, take
charge of Defensive
subordinates, and
responsive to superiors
Winning is valued and a
win-lose approach is used

Competitive

Perfectionistic

Perfectionistic, persistent, and hard working

Theories On The Relationship Between

Organizational Culture And Performance

Strong Culture Perspective

Fit Perspective
Adaptive Perspective

Strong Culture

An organizational culture with a consensus on the values

that drive the company and with an intensity that is
recognizable even to outsiders
Has a strong influence on organizational members

Facilitates performance because:

They are characterized by goal alignment

They create a high level of motivation because of shared
values by the members
They provide control without the oppressive effects of
bureaucracy

Factors Influencing The Strength of Culture

Size of the organization

Age of the organization

Rate of employee turnover
Strength of the original culture
Clarity of cultural values and beliefs

Strong versus Weak Cultures

Benefits of a Strong Culture

Creates a stronger employee commitment to the

organization.

Aids in the recruitment and socialization of new

employees.

Fosters higher organizational

performance by instilling and
promoting employee initiative.

Contingencies of Organizational Culture

& Performance
Sometimes strong organizational cultures fail to
generate higher organizational performance because:
1.

Culture content might be misaligned with the

organizations environment.

2.

Strong cultures may focus on mental models that

could be limiting.

3.

Strong cultures suppress dissenting values from

subcultures.

Fit Perspective

A culture is good only if it fits the industry or the

firms strategy
Three particular industry characteristics affect
culture:
1. Competitive environment
2. Customer requirements
3. Societal expectations

Adaptive Culture
An organizational culture that encourages confidence
and risk taking among employees, has leadership that
produces change, and focuses on the changing needs of
customers
Characteristics:

External focus - firms success depends on continuous change

Focus on processes more than goals
Employees assume responsibility for organizational
performance (they seek out opportunities)
Proactive and responsive

Most Important Elements in Managing

Culture

What leaders pay attention to

How leaders react to crises

How leaders behave

How leaders allocate rewards

How leaders hire and fire individuals

Strengthening Organizational Culture

Organizational Socialization Process

Stages of Socialization
Pre-Employment
Stage

Encounter
Stage

Role
Management

Outsider

Newcomer

Insider

Gathering
information

Testing
expectations

Changing roles
and behavior

Forming
psychological
contract

Resolving
conflicts

Outcomes of Socialization
Newcomers who are successfully socialized should exhibit:
Good performance
High job satisfaction
Intention to stay with organization
Low levels of distress symptoms
High level of organizational commitment

Changing Organizational Culture