Organizational Culture

Introduction

• Culture of any organization is hard to measure precisely

• It is recognized by the employees• Organizational culture governs how things are

done and way members are supposed to behave• Do not confuse organizational culture with job

satisfaction• Organizational culture is descriptive whereas job

satisfaction is evaluative

Definition

• Organizational Culture refers to a system of shared meaning held by members that distinguishes the organization from other organizations

• System of shared meaning is a set of key characteristics that the organization values

• 7 primary characteristics capture the essence of an organizational culture

Definition

• Innovation and risk taking– Degree to which employees are encouraged to be

innovative and risk takers• Attention to detail– Degree to which employees are expected to exhibit

precision, analysis and attention to detail• Outcome orientation– Degree to which management focuses on results or

outcomes rather than on the techniques and processes used to achieve those outcomes

Definition• People orientation

– Degree to which management decisions take into consideration the effect of outcomes on people within the organization

• Team orientation– Degree to which work activities are organized around teams rather

than individuals• Aggressiveness

– Degree to which people are aggressive and competitive rather than easygoing

• Stability– Degree to which organizational activities emphasize maintaining

the status quo in contrast to growth

Do Organizations Have Uniform Cultures?

• Culture is a system of shared meaning• Individuals at different levels and with different

backgrounds tend to describe OC in similar terms

• Most organizations have a dominant culture and numerous sets of subcultures

• Dominant culture expresses shared core values and gives an organization its distinct personality

Strong vs Weak Culture• In strong OC organization’s core values are intensely held and

widely shared• The more members accept the core values and the greater

their commitment to those values, the stronger the culture• In strong OC there is high degree of sharedness and intensity

which creates an internal climate of high behavioural control• There is lower employee turnover as there is high agreement

amongst members about what the organization stands for• The unanimity of purpose builds cohesiveness, loyalty and

organizational commitment

What do cultures do?

• Culture’s Functions– Creates distinction between one organization and

another – Conveys sense of identity for organization members– Facilitates generation of commitment to something

larger than one’s individual self-interest– Enhances stability of social system within the

organization– Serves as a sense making and control mechanism that

guides and shapes attitude and behaviour of employees

What do cultures do?

• Culture as a Liability– Barriers to change: When an organization’s environment is

undergoing rapid change an organization’s entrenched culture may no longer be appropriate

• Barriers to diversity– Management wants new employees to accept organization’s

core cultural values so that they fit in at the same time they want to acknowledge and demonstrate support for the differences that these employees bring to the workplace

– Diverse behaviours and strengths are likely to diminish in strong cultures as people attempt to fit in

Creating and Sustaining Culture

• An organization’s culture does not pop out of thin air

• What forces influence the creation of a culture?

• What reinforces and sustains these forces once they are in place?

Creating and Sustaining Culture• Top Management

– The actions of the top management have a major impact on the organization’s culture

– Through what they say and how they behave senior management establishes norms that filter down through the organization

• Socialization– Organizations have to help new employees adapt to its cuture– Employees who fail to learn the essential or pivotal role behaviours risk

being labeled nonconformists or rebels which may lead to expulsion– Socialization comprises of three stages: pre-arrival, encounter and

metamorphosis – Socialization can be formal or informal, individual or collective, serial or

random, investiture or divestiture

How Employees Learn Culture?

• Culture is transmitted to employees in a number of forms– Stories circulate through many organizations e.g., rule

breaking, reduction in workforce reactions to past mistakes, etc.

– Rituals: repetitive sequence of activities that express and reinforce the key values of the organization

– Material symbols– Language: developing unique terms to describe

several things

Creating an Ethical Organizational Culture

• Management can do the following to create a more ethical culture:– Be a visible role model. Senior management must take

ethical high road– Communicating ethical expectations. Ethical ambiguities

can be minimized by creating and disseminating an organizational code of ethics

– Provide ethical training– Visibly reward ethical acts and punish unethical ones– Provide protective mechanisms to discuss ethical dilemmas

and report unethical behaviour without fear of reprimand

Creating a Positive Organizational Culture

• A positive organizational culture is defined as a culture that emphasizes building on employee strengths, rewards more than it punishes and emphasizes individual vitality and growth

• Workers must be shown how to capitalize on their strengths and make the most of them

• Focusing on pay and promotions is important but power of smaller and cheaper rewards like praise is also high. Managers must catch employees doing something right

• Employees’ career aspirations must be treated as important