Chapter 3

Changing the Culture

An Experiential Approach to Organization Development 7th edition Chapter 3

Slide 1
 Learning Objectives

Recognize importance of corporate culture.

Identify key factors assessing culture.
Describe culture leading to effective
organizations.

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 Culture Change at Tivoli Systems

Tivoli in competitive software business.

Part of IBM.
IBM tries to infuse culture of Tivoli into IBM.
IBM placed Tivoli in charge of systems
management business.
Goal to blend power of IBM with speed of small
company.
An Experiential Approach to Organization Development 7th edition Chapter 3
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 Creating Concept for Change

Challenge of managers is:

Create renewing system.
Develop long-term efforts.
Culture often key to success.
Cultural change result of complex strategy.

An Experiential Approach to Organization Development 7th edition Chapter 3

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Understanding Corporate Culture

Given an environment of rapid change, a static

organizational culture can no longer be
effective.

An Experiential Approach to Organization Development 7th edition Chapter 3

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 Our Changing World:
54 Gallons of Soda (part 1 of 2)
Coca-Cola one of most recognized brands.
Sells 300 brands in 200 markets.
Despite boom in 80s and 90s, Coke facing
serious problems.

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 Our Changing World:
54 Gallons of Soda (part 2 of 2)
Coke undergoing cultural transformation.
Changing to innovation.
Trying to better understand customers.
Customizes brands to please local tastes.
Emphasis shifted from U.S. and Japan to other
countries.

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 What Is Corporate Culture?

Culture is a system of:

Shared values. Beliefs. Behavioral norms.
Observed behavioral norms.
Dominant values.
Learning the ropes for newcomers.

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 Culture From 2 Subsystems

1. Managerial.
2. Organizational.

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 Managerial Subsystem

Through actions and words, managers define

philosophy of how employees are treated.
Vision articulated by top management.

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 Organizational Subsystem

Outside factors define culture.

Technology influences culture.
Job descriptions and structure influence
cultures development.

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 Figure 3.1
Culture Formation

An Experiential Approach to Organization Development 7th edition Chapter 3

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 Corporate Culture and Success

High-performing companies have strong

cultures.
Many cultures fail to adapt to change.
Following corporate mergers, cultures often
clash.

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 Key Factors to Improve Culture

Create vision for the future.

Develop model for change.
Reward changes.

An Experiential Approach to Organization Development 7th edition Chapter 3

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 Cultural Resistance to Change

Changing culture not easy.

Time required.
Culture can prevent company from adapting.

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 Organizational Adaptability

Recession. Social factors.

Deregulation. Global competition.
Technological Outsourcing.
upheavals. Markets.

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 Tools for Change (part 1 of 4)

1. Information.
2. Support.
3. Resources.

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 Information (part 2 of 4)

Provide information to people.

One method is open-book management.

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 Support (part 3 of 4)

Support and collaboration from other

departments.
Management support to provide climate of risk
taking.

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 Resources (part 4 of 4)

Funds. Equipment.
Staff. Materials.

Innovative programs for providing resources

including:
Skunk works. Innovation Banks

Venture capital.
An Experiential Approach to Organization Development 7th edition Chapter 3
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 OD in Practice:
Whats Your Culture Worth
(part 1 of 2)
Setpoint is custom-manufacturing company with
about 30 employees.
Petersen of Petersen Inc. wanted to learn about
open-book management.

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 OD in Practice:
Whats Your Culture Worth
(part 2 of 2)
Employees on shop floor explained it in detail.
Rank-and-file understood accounting concepts
that helped to make decisions.
Had specific objectives to meet daily and
weekly profit goals.

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Slide 22
 Table 3.1
Key Factors in Culture Change

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 Organizational Dimensions
Affecting Performance
1. Managerial effectiveness.
2. Managerial efficiency.
3. Motivational climate.

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 Other Criteria for Organizational
Effectiveness
1. Adaptability.
2. Sense of identity.
3. Capacity to test reality.

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OD Professional Values and Ethics

Expertise. Commitment.
Autonomy. Code of ethics.

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 OD Implementation Issues

Success dependent upon fit between OD

values and organizations values.
Key issue is value orientations and purpose of
change.

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 Imposed Change

OD ideally implemented voluntarily.

Top management may impose program.
OD practitioners cognizant of power and
politics.

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 Determine Priority of Goals

Goals given precedence.

Develop balanced intervention.

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 OD Values About Nature
of Human Beings
Respect for people. Confrontation.
Trust and support. Participation.
Power equalization.

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 Table 3.2
OD Values

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 Key Words and Concepts

Corporate culture - system of shared values

and beliefs that interact with people,
structure, and systems.
Managerial effectiveness - ability to
accomplish specific organizational goals.

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 Managerial efficiency - ratio of output (results)
to input (resources).
Motivational climate - employee attitudes that
influence performance.
Open-book-management - employees
understand accounting statements and use
knowledge in work.

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 Organizational effectiveness - result of
successful OD program.
Professionalism - value system that is part of
profession.

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 Preparations for Next Chapter

Read Chapter 4.
Complete Steps 1 through 4 of OD Skills
Simulation 4.1. (Takes 30 - 60 minutes.)

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