Organizational Behavior: Managing

People and Organizations,

Ninth Edition
Gregory Moorhead, Ricky W. Griffin

Chapter 18

Culture

Chapter Learning Objectives

After studying this chapter you should be able to:
Define organization culture, explain how it affects
employee behavior, and understand its historical roots.
Describe how to create organization culture.
Describe two different approaches to culture in
organizations.
Identify emerging issues in organization culture.
Discuss the important elements of managing the
organizational culture.

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The Nature of Organization Culture

Why Study Culture?
It is assumed that organizations with a strong culture

perform at higher levels than those without a strong

culture

Organizational Culture
A set of values held by individuals in a firm that help

employees understand acceptability of actions

Culture Values
Are often taken for granted (implicit)
May not be made explicit (i.e., not written down)
Are communicated through symbolic means

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Table 18.1

Definitions of Organization Culture

Definition

Source

A belief system shared by an organizations members

J. C. Spender, Myths, Recipes and Knowledge-Bases in Organizational Analysis

(Unpublished manuscript, Graduate School of Management, University of California
at Los Angeles, 1983), p. 2.

Strong, widely shared core values

C. OReilly, Corporations, Cults, and Organizational Culture: Lessons from Silicon

Valley Firms (Paper presented at the Annual Meeting of the Academy of
Management, Dallas, Texas, 1983), p. 1.

The way we do things around here

T. E. Deal and A. A. Kennedy, Corporate Cultures: The Rites and Rituals of

Corporate Life (Reading, MA: Addison-Wesley, 1982), p. 4.

The collective programming of the mind

G. Hofstede, Cultures Consequences: International Differences in Work-Related

Values (Beverly Hills, CA: Sage, 1980), p. 25.

Collective understandings

J. Van Maanen and S. R. Barley, Cultural Organization: Fragments of a Theory

(Paper presented at the Annual Meeting of the Academy of Management, Dallas,
Texas, 1983), p. 7.

A set of shared, enduring beliefs communicated through a

variety of symbolic media, creating meaning in peoples
work lives

J. M. Kouzes, D. F. Caldwell, and B. Z. Posner, Organizational Culture: How It Is

Created, Maintained, and Changed (Presentation at OD Network National
Conference, Los Angeles, October 9, 1983).

A set of symbols, ceremonies, and myths that

communicates the underlying values and beliefs of that
organization to its employees

W. G. Ouchi, Theory Z: How American Business Can Meet the Japanese Challenge
(Reading, MA: Addison-Wesley, 1981), p. 41.

A dominant and coherent set of shared values conveyed by

such symbolic means as stories, myths, legends, slogans,
anecdotes, and fairy tales

T. J. Peters and R. H. Waterman Jr., In Search of Excellence: Lessons from

Americas Best-Run Companies (New York: Harper & Row, 1982), p. 103.

The pattern of basic assumptions that a given group has

invented, discovered, or developed in learning to cope with
its problems of external adaptation and internal integration

E. H. Schein, The Role of the Founder in Creating Organizational Culture,

Organizational Dynamics, Summer 1985, p. 14.

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The Nature of Organization Culture (contd)

Anthropology
Anthropology

Sociology
Sociology

Historical
Historical
Foundations
Foundations

Social
Social
Psychology
Psychology

Economics
Economics

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Organization Culture Versus Climate

Organization Culture
The historical context within which a situation occurs

and the impact of this context on the behaviors of

employees
Difficult to alter in the short-run
Means through which people in the organization learn and
communicate organization acceptability (values and norms)

Organization Climate
The current situations in an organization and the

linkages among work groups, employees, and work

performance
Easier for management to manipulate in order to directly
affect the behavior of employees

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Table 18.2

Creating Organization Culture

Creating Organization Culture

Step 1Formulate Strategic Values
Step 2Develop Cultural Values
Step 3Create Vision
Step 4Initiate Implementation Strategies
Step 5Reinforce Cultural Behaviors

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Creating the Organization Culture

Establish Values
Strategic values
The basic beliefs about an organizations
environment that shape its strategy.
Cultural values
The values that employees need to have
and act on for the organization to act on
the strategic values.

Create Vision
Create a picture of the organization

that portrays how the strategic and

cultural values will combine to create
the future.

Digital Vision at Getty Images

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Creating the Organization Culture (contd)

Initiate Implementation Strategies
Take actions founded on the strategic and cultural

values to accomplish the vision.

Reinforce Cultural Behaviors

Use formal reward systems to encourage desired

employee behaviors
Tell stories that epitomizing cultural values
Conduct ceremonies and rituals that emphasize right

actions by employees

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Approaches to Describing
Organization Culture:
The Ouchi Framework
The
TheOuchi
OuchiFramework
Framework

Typical
Typical
United
UnitedStates
States
firms
firms

Typical
Typical
Japanese
Japanese
firms
firms

Type
TypeZZ
United
UnitedStates
States
firms
firms

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Table 18.3

The Ouchi Framework

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Table 18.4

The Peters and Waterman Framework

Attributes of an Excellent Firm

1. Bias for action
2. Stay close to the customer
3. Autonomy and entrepreneurship
4. Productivity through people
5. Hands-on management
6. Stick to the knitting
7. Simple form, lean staff
8. Simultaneously loose and tight organization
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Emerging Issues in Organization Culture:

Innovation
Innovation
The process of creating and doing new things that are

introduced into the marketplace as products,

processes, or services
Types
Types of
of Innovation
Innovation

Radical
Radical
Innovation
Innovation

Systems
Systems
Innovation
Innovation

Incremental
Incremental
Innovation
Innovation

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Emerging Issues in Organization Culture:

Innovation (contd)
New Ventures
Require entrepreneurship and

good management
Intrapreneurship
Entrepreneurial activity that takes
place within the context of a large
organization

Entrepreneurs profile
Need for achievement
Desire to assume responsibility
Willing to take risks
Focus on concrete results

Digital Vision at Getty Images

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Emerging Issues in Organization Culture:

Innovation (contd)
Corporate Research
Supports existing businesses to provide incremental

innovations and to explore potential new technology

bases
Is responsible for keeping the companys products

and processes technologically advanced

Corporate culture can be instrumental in fostering

environment for creativity and innovation

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Emerging Issues in Organization Culture

(contd)
Empowerment
Is enabling workers to set their own work goals, make

decisions, solve problems within their sphere of

responsibility and authority

Appropriate Cultures (Goffee and Jones)

Factors that may determine the appropriate type of

culture appropriate for an organization:

The nature of the value chain
The dynamism of the environment

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Managing Organization Culture

Elements
Elementsof
ofManaging
Managing
Organization
OrganizationCulture
Culture

Taking
Taking
advantage
advantageof
of
existing
existingculture
culture

Teaching
Teaching
organization
organization
culture
culture

Changing
Changing
organization
organization
culture
culture

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Managing Organization Culture (contd)

Taking Advantage of the Existing Culture
Easier and faster to alter employee behaviors within

the existing culture than it is to change existing

history, traditions, and values
Managers must be aware and understand the

organizations values
Managers can communicate their understanding to

lower-level individuals

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Managing Organization Culture (contd)

Teaching Organization Culture
Organizational socialization
Is the process through which employees learn about the firms
culture and pass their knowledge and understanding on to
others

Organizational mechanisms
Are examples of organization culture that employees see in
more experienced employees behaviors
Corporate pamphlets and formal training sessions

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Managing Organization Culture (contd)

Changing the Organization Culture
Managing symbols
Substituting stories and myths that support the new cultural
values for those that support old ones

Culture can be difficult to change when upper

management inadvertently reverts to old behaviors

The Stability of Change

New values and beliefs must be seen as stable and

influential as old ones

Changing value systems requires enormous effort

because value systems tend to be self-reinforcing

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Organizational Behavior in Action

After reading the chapter:
Why do organizations lose the innovative aspects of

their organizational culture?

What should managers do to turn climate into culture

in new organizations?
What are the effects of technology on culture in

organizations?

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