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Management 3600 Chapter 14 - Organizational Culture
Terms in this set (59)
Organizational Culture Defined
The values and assumptions shared within an organization. Defines what is important and unimportant and directs everyone in the organization toward the "right way" of doing things.
Organizational Culture - Company's DNA
invisible to the eye, yet a powerful template
that shapes employee behavior in the workplace
Elements of Organizational Culture -Shared assumptions
Essence of organizational culture - unconscious. Taken-for granted perceptions or ideal prototypes of behavior - only discovered by observing employees.
Elements of Organizational Culture - Shared Values - Artifacts
Values that people within the organization or work unit have in common and place near top of their values hierarchy. Need to focus on shared enacted values (relied upon to guide decisions and behavior) not espoused values (values they want others to believe guide the organization's decisions and actions).
Elements of Organizational Culture
Observable symbols and signs of an organization's culture.
Content of Organizational Culture
Cultural content - the relative ordering of shared values (e.g. WestJet - fun-loving, customer-focused, employee-friendly).
Problems with measuring organizational culture
Oversimplifies the diversity of cultural values. Ignores shared assumptions because they represent a deeper
aspect of culture. Adopts an "integration" perspective - assumes that organizations have a fairly clear, unified culture that is easy to decipher.
An organization's culture is blurry/fuzzy:
Consists of diverse subcultures (fragmentation). Values exist within individuals, not work units.
Organizational Culture Dimensions Profile
Models of organizational culture content classify organizational culture into a few categories - popular with corporate leaders. Example: This model identifies 7 corporate cultural dimensions: Innovation, Stability, Respect for people, Outcome orientation, Attention to detail, Team orientation, Aggressiveness
Organizational Culture Dimensions - Innovation
Experimenting, opportunity seeking, risk taking, few rules, low cautiousness
Organizational Culture Dimensions - Stability
Predictability, security, rule-oriented
Organizational Culture Dimensions - Respect for People
Organizational Culture Dimensions - Outcome Orientation
Action oriented, high expectations, results oriented
Organizational Culture Dimensions - Attention to Detail
Organizational Culture Dimensions - Team Orientation
Organizational Culture Dimensions - Aggressiveness
Competitive, low emphasis on social responsibility
Values and assumptions shared most consistently and widely by the organization's members
Are located throughout the organization. Can enhance or oppose (countercultures) firm's dominant culture. Some organizations (e.g. some universities, according to one study), operate within subcultures and do not have a dominant
culture at all.
Two functions of countercultures:
Provide surveillance and critical review of the dominant culture and maintain standards of ethical behavior. Source of emerging values to keep the firm aligned with the needs of customers, suppliers, society, and other stakeholders.
Artifacts: Stories and Legends
Observable symbols and signs of culture. Physical structures, ceremonies, language, stories. Maintain and transmit organization's culture. Need many artifacts to accurately decipher a company's culture. Four broad categories - organizational stories and legends,
rituals and ceremonies, organizational language, and physical structures and symbols.
Artifacts of Organizational Culture
Provide social prescriptions of desired (or dysfunctional) behavior. Provides realistic human side to expectations and individual
Most effective stories and legends:
Describe real people, Assumed to be true, Known by employees throughout the organization, Prescriptive - advise people what to do or not to do.
Programmed routines of daily organizational life, e.g. how meetings are conducted, how visitors are greeted,
how much time employees take for lunch, etc.
Planned activities conducted for an audience, e.g. award ceremonies, celebrating new product launch.
Artifacts: Organizational Language
Words used to address people, describe customers, etc., Leaders use phrases and special vocabulary as cultural symbols
e.g. Container Store's "Being Gumby" i.e. flexible, Language also found in subcultures e.g. Whirlpool's "PowerPoint culture."
Artifacts: Physical Structures/Symbols - Building structure
may shape and reflect culture e.g. size, shape, location, and age of buildings; might suggest a company's emphasis on teamwork, environmental emphasis.
Artifacts: Physical Structures/Symbols - Office design
conveys cultural meaning e.g. furniture, office size, wall hangings (or lack of them)
Organizational Culture Strength
How widely and deeply employees hold the company's
dominant values and assumptions
Strong cultures exist when:
Most employees understand and embrace dominant values. Values and assumptions are institutionalized through well established artifacts - makes it difficult to change the culture. Culture is long lasting - often traced back to founder.
Functions of strong organizational cultures
Control system - influences employee decisions and behavior i.e. a deeply embedded form of social control, Social glue - bonds people together (social identity), Sense-making - helps employees understand what is expected of them e.g. increases role clarity.
Contingencies of Organizational Culture & Performance
Only a modestly positive relationship between culture strength
and organizational effectiveness
Contingencies of Organizational Culture & Performance - Ensure culture-environment fit
Ensuring the organization's culture content (dominant values and assumptions) fits the external environment.
Contingencies of Organizational Culture & Performance - Avoid corporate "cult" strength
Companies with very strong cultures (i.e. corporate "cults") are less effective than companies with moderately strong culture. Very strong cultures may lock people into mental models which can blind them to new opportunities and suppress dissenting
values from subcultures.
Contingencies of Organizational Culture & Performance - Create an adaptive culture
(employees are receptive to change). External focus; recognize need for continuous change. Support changing internal work processes; flexibility in roles. Strong learning orientation e.g. experiment with new ideas/practices; view mistakes as part of learning.
Merging Cultures: Bicultural Audit
Part of due diligence in merger. Minimizes risk of cultural collision by diagnosing companies before merger.
Three steps in bicultural audit:
1. Identify cultural differences between the merging companies 2. Analyze bicultural audit data to determine which differences
will result in conflict and which cultural values provide common ground 3. Identify strategies and prepare action plans to bridge the two organization's cultures.
Merging Organizational Cultures - Assimilation (rare)
Acquired company employees willingly embrace cultural values of acquiring firm. Typically works when acquired company has a weak dysfunctional culture and acquiring company's culture is strong
and aligned with the external environment. Culture clash is rare - employees are looking for alternative.
Merging Organizational Cultures - Deculturation
Acquiring firm imposes its culture and business practices. Necessary when acquired firm's culture doesn't work. Employees in acquired firm tend to resist
Merging Organizational Cultures - Integration
Combine the two or more cultures into a new composite culture that preserves the best features of both cultures. Slow and potentially risky - many forces preserving the existing cultures. May work when companies have relatively weak cultures,
cultural values overlap, or employees are motivated to adopt a new set of dominant values.
Merging Organizational Cultures - Separation
Merged firms keep their own corporate cultures and practices i.e. remain distinct entities. Best when merging firms are in unrelated industries or different countries.
Four strategies that have had some success at altering corporate cultures:
Actions of founders and leaders. Aligning artifacts. Introducing culturally consistent rewards. Attracting, selecting, and socializing employees.
Changing/Strengthening Organizational Culture - Actions of founders and leaders
Organizational culture sometimes reflects the founder's personality - this cultural imprint can be very powerful. Transformational leaders - can reshape culture using organizational change practices.
Changing/Strengthening Organizational Culture - Aligning artifacts
Artifacts keep the culture in place - leaders can potentially adjust shared values and assumptions e.g. communicating organizational stories, creating memorable
events that symbolize the desired cultural values, transferring current employees who abide by the culture into new
Changing/Strengthening Organizational Culture - introduceing culturally-consistent rewards
Reward systems are power artifacts that strengthen or reshape an organization's culture - reinforce behaviors that are consistent with cultural values.
Changing/Strengthening Organizational Culture - Attracting, selecting and socializing employees
Attraction-selection-attrition theory - attracting and hiring people who already embrace the cultural values (includes weeding out people who don't fit the culture). Organizational socialization practices.
Attraction-Selection-Attrition Theory - Attraction
Organizations become more homogeneous and create a stronger culture through: Attraction - applicants engage in self-selection by avoiding
employment in companies whose values seem incompatible with their own values.
Attraction-Selection-Attrition Theory - Selection
Organizations become more homogeneous and create a stronger culture through: Selection - how well the person "fits" with the company's
culture is often an important factor in deciding which job applicant to hire.
Attraction-Selection-Attrition Theory - Attrition
Organizations become more homogeneous and create a stronger culture through:Attrition - employees quit or are forced out when their values oppose company values i.e. people seek person-organization value congruence that supports their social identity and minimizes internal role conflict.
Organizational Socialization Defined
The process by which individuals learn the values, expected behaviors, and social knowledge necessary to assume their
roles in the organization.
Newcomers form a cognitive map of the social, strategic, and cultural dynamics of the organization. Learn about performance expectations, power dynamics, corporate culture, company history, and jargon. Also need to form successful and satisfying relationships with other people in order to "learn the ropes"
Newcomers need to adapt to their new work environment. Develop new work roles - reconfigure their social identity. Adopt new team norms and practice new behaviors. Newcomers with diverse work experience adjust better.
Perception formed during recruitment and throughout the socialization process. Individual's beliefs about the terms and conditions of a reciprocal exchange agreement between that person and
another party i.e. the employer in most work situations.
Psychological contract - Transactional contracts
primarily short-term economic exchanges; well-defined responsibilities.
Psychological contract - Relational contracts
long-term attachments that include a broad range of mutual obligations.
Stages of Socialization - Stage 1: Pre-employment Socialization
All learning and adjustment before first day of work. Involves collecting information. Forming psychological contract
Stages of Socialization - Stage 2: Encounter
Begins first day in new work environment. Newcomers test how well their premployment expectations fit reality.Reality shock - stress that results when employees perceive discrepancies between their preemployment expectations and on-the-job reality.
Stages of Socialization - Stage 3: Role Management
Most active as employees transition from newcomers to insiders. Strengthen relationships with co-workers and supervisors. Practice new role behaviors and adopt attitudes and values consistent with their new positions and organization. Resolve conflicts between work-nonwork activities.
Improving Organizational Socialization - Realistic job preview (RJP)
Balance of positive and negative information about the job and work context. Helps applicants decide for themselves whether they are compatible with the job and organization. Scare away some applicants; reduce turnover and increase job performance; minimizes reality shock.
Improving Organizational Socialization - Socialization agents
Socialization occurs mainly through socialization agents. Supervisors - provide technical information, performance
feedback, buffering them from excessive demands, help them form social ties with co-workers. Co-workers - easily accessible, answer questions, serve as role models, being flexible and tolerant with new hires.
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