Chapter 1
Organizational Culture
Copyright ©2005 by South-Western, a division of Thomson Learning. All rights reserved.
Organizational (Corporate)
Culture
A pattern of basic assumptions that are considered
valid and that are taught to new members as
the way to perceive, think, and
feel in the organization
Artifacts - symbols of
culture in the physical
and social work environment
Values
Espoused: what members of Levels of
an organization say they value Organizational
Enacted: reflected in the way Culture
individuals actually behave
Assumptions - deeply held
beliefs that guide behavior and tell
members of an organization how
to perceive and think about things
Artifacts Organizational
Personal enactment Culture Levels
Ceremonies and rites
Stories Visible, often not
Ritual decipherable
Symbols
Values
Testable in physical environment Greater level
Testable only by social consensus of awareness
Assumptions
Relationship to environment Taken for granted
Nature of reality, time, and space Invisible
Nature of human nature Preconscious
Nature of human activity Reprinted with permission from Edgar H. Schein, Organizational
Culture and Leadership: A Dynamic View. Copyright © 1985 Jossey-Bass
Nature of human relationships Inc, asubsidiary of John Wiley & Sons, Inc.
Functions of Organizational Culture
Culture provides a sense of identity to members and
increases their commitment to the organization
Culture is a sense-making device
for organization members
Culture reinforces the values
in the organization
Culture serves as a control
mechanism for shaping
behavior
Theories about the
relationship between Strong
Culture
organizational culture
Perspective
and performance
Fit
Adaptive Perspective
Perspective
An organizational culture
with a consensus on the
values that drive the company Strong
and with an intensity that is Culture
recognizable even to outsiders Perspective
Strong cultures facilitate 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
Argument that a culture is good
only if it fits the industry’s or the
firm’s strategy. Fit
Perspective
Organizational characteristics that may affect culture
▪ Customer requirements
▪ Competitive environment
▪ Societal expectations
An organizational culture that
encourages confidence and risk
taking among employees, has Adaptive
leadership that produces change, and
focuses on the changing needs of Perspective
customers
Adaptive Nonadaptive
Most managers care Most managers care
Core Values about customers, about themselves,
stockholders, and their work group, or
employees an associated product
Managers pay close Managers tend to
Common attention to all behave somewhat
Behavior their constituencies, insularly, politically,
esp. customers and bureaucratically
Reprinted with the permission of The Free Press, a Division of Simon & Schuster, Inc. from Corporate Culture and Performance by
John P. Kotter and James L Heskett. Copyright © 1992 by Kotter Associates, Inc. and James L. Heskett.
Five 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
Organizational Socialization
The process by which newcomers are
transformed from outsiders to
participating, effective members of the
organization
1. Anticipatory Realism Congruence
Socialization
Job demands
2. Encounter •Task
•Role
•Interpersonal
3. Change and
Mastery
Acquisition
Outcomes of Socialization Performance
Satisfaction
Stages of Mutual influence
Socialization Low levels of distress
From “An Ethical Weather Repart: Assessing the Organizaiton’s Ethical Climate” by John B. Cullen, et
Intent to remain
al. In Organizational Dynamics, Autumn 1989. Copyright © 1989 American Management Asociation
International. Reprinted by permission of American Management Association International, New York, N.Y.
All rights reserved. Http://www.amanet. Org.
1. Anticipatory Socialization - the first socialization
stage--encompasses all of the learning that takes
place prior to the newcomer’s first day on the job
2. Encounter - the second socialization stage-- the
newcomer learns the tasks associated with the job,
clarifies roles, and establishes new relationships at
work
3. Change & Acquisition - the third socialization
stage—the newcomer begins to master the demands
of the job
Socialization as
Cultural Communication
Core values are transmitted to new organization
members through
◼ the role models they interact with
◼ the training they receive
◼ the behavior they observe being rewarded and
punished
Assessing Organizational
Culture
Organizational Culture Inventory focuses on
behaviors that help employees fit into the
organization & meet coworker expectations
Kilman-Saxton Culture-Gap Survey focuses on the
expectations of others in the organization
Triangulation - the use of multiple methods to
measure organizational culture
Situations That May Require
Cultural Changes
Merger or acquisition
Employment of people from different countries
Reasons That Change Is Difficult
Assumptions are often unconscious
Culture is deeply ingrained and behavioral norms
and rewards are well learned
Hiring and Removing
socializing Culture members who
members who reject the
fit in with the new culture
4 new culture 5
Cultural Changing
1
3 communication behavior
Examining
justifications
Interventions for
for changed
Changing
behavior
Organizational
Reprinted with permission from Vijay Sathe “How to Decipher & Change
Culture 2 Corporate Culture,” Copyright © 1985 Jossey-Bass Inc, Reprinted by permission
Of Jossey-Bass, Inc., a subsidiary of John Wiley & Sons, Inc..
Cultural Modifications in the
Current Business Environment
Support for a global Empowerment of
view of business employees to excel
in product and
service quality
Reinforcement of
ethical behavior
Support for a global
view of business
Create a clear and simple mission statement
Create systems that ensure effective information
flow
Create “matrix minds” among managers
Develop global career paths
Use cultural differences as major assets
Implement worldwide management education and
team development programs
Reinforcement of
ethical behavior
Clear communication of the boundaries of ethical
conduct
Selection of employees who support the ethical
culture
Reward of ethical behavior
Conspicuous punishment of members who engage
in unethical behavior
Empowerment of employees to
excel in product and service quality
Empowerment unleashes employees’ creativity
Empowerment requires eliminating traditional
hierarchical notions of power
◼ Involve employees in decision making
◼ Remove obstacles to their performance
◼ Communicate the value of product and service
quality
