You are on page 1of 30

What is organizational culture?

How do you understand an organizational


culture?
What is innovation and why is it so
important?
How to manage organizational culture and
innovation?
Copyright 2012 John Wiley & Sons, Inc.

15-2

Organizational culture
The system of shared actions, values, and

beliefs that develops within an


organization and guides the behavior of its
members.

Copyright 2012 John Wiley & Sons, Inc.

15-3

External adaptation
Knowing ways of reaching goals.
Knowing the tasks and methods to achieve

goals.
Methods of coping with success and

failure.

Copyright 2012 John Wiley & Sons, Inc.

15-4

Separating, or prioritizing, external forces

based on their importance.


Developing ways to measure

accomplishments.
Creating explanations for not meeting

goals.

Copyright 2012 John Wiley & Sons, Inc.

15-5

What is the real mission?


How can we contribute?
What are our goals and how do we reach them?
What external forces are important?
How doe we measure results?
What do we do if specific targets are not met?
How do we tell others how good we are?
How will we know when to quit?

Copyright 2012 John Wiley & Sons, Inc.

15-6

Internal integration
The creation of a collective identity.
Finding ways of working and living

together.

Copyright 2012 John Wiley & Sons, Inc.

15-7

Recall the

Was it formal or informal?

orientation you

Were the rules described

received during

or written in a manual?

your first day or


week with DLSU - D

What were you told about


your department?

How did you meet your


classmates? (individually,
collectively, during lunch)

Copyright 2012 John Wiley & Sons, Inc.

15-8

Deciding how to allocate power, status, and

authority.
Establishing a shared understanding of who

will get rewards and sanctions for specific


types of actions.
Working out ways to communicate and

develop guidelines for friendships.

Copyright 2012 John Wiley & Sons, Inc.

15-9

What is our unique identity?


How do we view the world?
Who is a member?
How do we allocate power, status, and

authority?
How do we communicate?
What is the basis for friendship?

Copyright 2012 John Wiley & Sons, Inc.

15-10

Subcultures
A group of individuals who exhibit a unique pattern of

values and a philosophy that is consistent with the


organizations dominant values and philosophy.

Countercultures
Groups whose patterns of values and philosophies

outwardly reject those of the larger organization or


social system.

Copyright 2012 John Wiley & Sons, Inc.

15-11

Problems associated with importing societal


subgroups from the larger society
Subgroups may naturally form into a counterculture.
The firm may encounter extreme difficulty in coping

with broader cultural changes.


Embracing natural divisions from the larger culture

may lead to difficulty in developing sound


international operations.

Copyright 2012 John Wiley & Sons, Inc.

15-12

A firm that values diversity but

systematically works to block the


transfer of societally based subcultures
into the fabric of the organization.

Copyright 2012 John Wiley & Sons, Inc.

15-13

The organization should develop pluralism with the objective of

multi-based socialization.
The firm should fully integrate its structure to prevent direct

relationship between a group and any particular job.


The firm must integrate the informal networks by eliminating

barriers and increasing participation.


The organization should break the linkage between group

identity and identity of the firm.


The organization must actively work to eliminate interpersonal

conflict based on either group identity or large group backlash.

Copyright 2012 John Wiley & Sons, Inc.

15-14

Observable culture.
Shared values.
Common cultural assumptions.

Copyright 2012 John Wiley & Sons, Inc.

15-15

Sagas
Heroic accounts of organizational

accomplishments.

Rites
Standardized and recurring

activities that are used at special


times to influence the behaviors
and understanding of
organizational members .

Copyright 2012 John Wiley & Sons, Inc.

15-16

Rituals
- are systems of rites
Cultural symbols
Any object, act, or event that serves to

transmit cultural meaning (i.e. the color


brown and the nickname Big Brown is
associated with UPS).
Copyright 2012 John Wiley & Sons, Inc.

15-17

Shared values
Help turn routine activities into valuable

and important actions.


Tie the organization to the important

values of society.
May provide a very distinctive source of

competitive advantage.

Copyright 2012 John Wiley & Sons, Inc.

15-18

A belief that ritual and ceremony are important to

members and to building a common identity.


A well-understood sense of the informal rules and

expectations so that employees and managers


know what is expected of them.
A belief that what employees and managers do is

important and that it is essential to share


information and ideas.

Copyright 2012 John Wiley & Sons, Inc.

15-19

Unproven and often unstated beliefs that

are accepted uncritically.


Enable managers to redefine impossible
problems.
Facilitate experimentation and creativity.
Allow managers to govern.

Copyright 2012 John Wiley & Sons, Inc.

15-20

Innovation
The process of creating new ideas and

putting them into practice.

Copyright 2012 John Wiley & Sons, Inc.

15-21

Copyright 2012 John Wiley & Sons, Inc.

15-22

Product innovations
Introduce new or improved goods or

services to better meet customer needs.

Process innovations
Introduce new and better methods and

operations.

Copyright 2012 John Wiley & Sons, Inc.

15-23

Innovation is a continual process of:


Exploitation
Focuses on refinement of and reuse of existing
products and processes.

Exploration
Calls for the organization and it managers to
stress freedom and radical thinking, opening the
firm to big changes what some call radical
innovations.
Copyright 2012 John Wiley & Sons, Inc.

15-24

Management philosophy
Links goals with key collaboration issues

and comes up with a series of general


ways by which the firm will manage its
affairs.

Copyright 2012 John Wiley & Sons, Inc.

15-25

A well-developed management philosophy


:
Establishes generally understood boundaries

for all members of the firm.


Provides a consistent way for approaching

new and novel situations.


Helps hold individuals together by assuring

them a known path to success.


Copyright 2012 John Wiley & Sons, Inc.

15-26

Managers help modify visible aspects of

culture, such as language, stories, rites, rituals,


and sagas.
Through reward systems two common

patterns:
Steady state (hierarchical, clan cultures)
Evolution and change (market culture)

By setting the tone of the organization.


Copyright 2012 John Wiley & Sons, Inc.

15-27

Trying to change peoples values from

the top down without also changing


how the organization operates and
recognizes the importance of individuals
does not work very well.

Copyright 2012 John Wiley & Sons, Inc.

15-28

Organizational lag
The dominant cultural patterns are

inconsistent with emerging innovations.


Cultural change is hampered by a legacy

of established behaviors, with an


overreliance on rule following and
reinforcement of old patterns of action.

Copyright 2012 John Wiley & Sons, Inc.

15-29

Demonstrate how shared values and

common assumptions can be applied to


new innovations.
Balance rule changing with rule

following.

Copyright 2012 John Wiley & Sons, Inc.

15-30