Chapter 24 Organizational Culture and Climate

Stephen Robbins

Institutionalization: A Forerunner of Culture

Origin of culture can be traced back more than 50 years ago to the notion of institutionalization. When an organization takes on a life of its own, apart from any of its members, becomes valued for itself, and acquires immortality. It operates to produce common understandings among members about what is appropriate and fundamentally meaningful behaviour.

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What Is Organizational Culture?

Organizational Culture A common perception held by the organizations members; a system of shared meaning. It is the basic pattern of shared assumptions, values, and beliefs considered to be the correct way of thinking about and acting on problems and opportunities facing the organization.

Characteristics: 1. Innovation and risk taking 2. Attention to detail 3. Outcome orientation 4. People orientation 5. Team orientation 6. Aggressiveness 7. Stability
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Culture Is A Descriptive Term

Organizational culture is concerned with how employees perceive its characteristics, not with whether they like them. Research on organizational culture has sought to measure how employees see their organization. Does it encourage teamwork? Does it reward innovation?

Does it stifle initiative?

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Do Organizations Have Uniform Cultures?

Dominant Culture Expresses the core values that are shared by a majority of the organizations members.

Subcultures Minicultures within an organization, typically defined by department designations and geographical separation.

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Do Organizations Have Uniform Cultures? (contd)

Core Values The primary or dominant values that are accepted throughout the organization.

Strong Vs Weak Culture

A culture in which the core values are intensely held and widely shared.

The more members who accept the core values and the greater their commitment to those values is, the strong the culture.
Strong culture results in lower turnover and high agreement among members about what the organization stands for,

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What Is Organizational Culture?

Culture Versus Formalization A strong culture increases behavioral consistency and can act as a substitute for formalization.

High formalization creates predictability, orderliness and consistency

Organizational Culture Versus National Culture

National culture has a greater impact on employees than does their organizations culture.
Nationals selected to work for foreign companies may be atypical of the local/native population.

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What Do Cultures Do?

Cultures Functions: Defines the boundary between one organization and others. Conveys a sense of identity for its members. Facilitates the generation of commitment to something larger than self-interest. Enhances the stability of the social system. Serves as a sense-making and control mechanism for fitting employees in the organization. Shared meaning of a strong culture ensures that everyone is pointed in the same direction.

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What Do Cultures Do?

Culture as a Liability: Culture enhances organizational commitment and increases the consistency of employee behavior, but there are potentially dysfunctional aspects of culture. 1. Barrier to change: When the shared values are not in agreement with those that will further the organizations effectiveness. This is most likely to occur when an organizations environment is dynamic.

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2.

Barrier to diversity: Management wants new employees to accept the organizations core cultural values but, at the same time, they want to support the differences that these employees bring to the workplace.

3.

Barrier to acquisitions and mergers: Financial advantages and Product synergy are the two factors that were considered earlier by the management in making acquisition/merger decisions.

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Creating Culture
An organizations culture comes from what it has done before and the degree of success it has had. The ultimate source of an organizations culture is its founders. The founders of an organization traditionally have a major impact on that organizations early culture. 1. Founders hire and keep only employees who think and feel the same way they do. 2. Founders indoctrinate and socialize these employees to their way of thinking and feeling. 3. The founders own behavior acts as a role model that encourages employees to identify with them and thereby internalize their beliefs, values, and assumptions.

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Sustaining Culture
Selection
Concern with how well the candidates will fit into the organization. Provides information to candidates about the organization. If the organizations hire the candidates that will fit into the organization will result into having values consistent with those of the organization.

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 Top Management The actions of top management, what they say and how they behave, establish norms that filter down through the organization as to: Risk taking. How much freedom managers should give their employees. What is appropriate dress. What actions will pay off in terms of pay raises, promotions, and other rewards. Socialization The process that helps new employees adapt to the organizations culture.

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Stages in the Socialization Process

Prearrival Stage

The period of learning in the socialization process that occurs before a new employee joins the organization. It recognizes that each individual arrives with a set of values, attitudes, and expectations about both the work to be done and the organization.
Encounter Stage The stage in the socialization process in which a new employee sees what the organization is really like and confronts the possibility that expectations and reality may diverge.

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 Metamorphosis Stage The relatively long-lasting changes take place. The new employee masters the skills required for his/her job, successfully performs his/her new roles, and makes the adjustments to his/her work groups values and norms.

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How Organization Cultures Form

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How Employees Learn Culture

Stories: Stories contain a narrative of events about the organizations founders, rule breaking, rags-to-riches successes, reductions in the workforce, relocation of employees, and organizational coping.

Rituals: Rituals are repetitive sequences of activities that express and reinforce the key values of the organization, what goals are most important, which people are important, and which are expendable.

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 Material Symbols: Some corporations provide their top executives with a variety of expensive perks. Others provide fewer and less elaborate perks. These material symbols convey to employees who is important, the degree of egalitarianism desired by top management, and the kinds of behavior that are appropriate. Language: Organizations, over time, often develop unique terms to describe equipment, offices, key personnel, suppliers, customers, or products that relate to its business. Many organizations and units use language as a way to identify members of a culture or subculture. By learning this language, members attest to their acceptance of the culture and help to preserve it.

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Creating An Ethical Organizational Culture

Characteristics of Organizations that Develop High Ethical Standards High tolerance for risk Low to moderate in aggressiveness Focus on means as well as outcomes Managerial Practices Promoting an Ethical Culture Being a visible role model. Communicating ethical expectations. Providing ethical training. Rewarding ethical acts and punishing unethical ones. Providing protective mechanisms.

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Creating a Customer-Responsive Culture

Key Variables Shaping Customer-Responsive Cultures 1. The types of employees hired by the organization. 2. Low formalization: the freedom to meet customer service requirements. 3. Empowering employees with decision-making discretion to please the customer. 4. Good listening skills to understand customer messages. 5. Role clarity that allows service employees to act as boundary spanners. 6. Employees who engage in organizational citizenship behaviors.

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Managerial Actions: Select new employees with personality and attitudes consistent with high service orientation. Train and socialize current employees to be more customer focused. Change organizational structure to give employees more control. Empower employees to make decision about their jobs. Lead by conveying a customer-focused vision and demonstrating commitment to customers. Conduct performance appraisals based on customer-focused employee behaviors. Provide ongoing recognition for employees who make special efforts to please customers.

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Spirituality and Organizational Culture

Workplace Spirituality The recognition that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of the community. Characteristics:

Strong sense of purpose

Focus on individual development Trust and openness Employee empowerment Toleration of employee expression

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