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Organizational Culture andOrganizational Culture and
LeadershipLeadership
Chapter 3Chapter 3
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Organizational Culture DefinedOrganizational Culture Defined
The basic pattern of shared assumptions,The basic pattern of shared assumptions,
values, and beliefs considered to be thevalues, and beliefs considered to be the
correct way of thinking about and actingcorrect way of thinking about and acting
on problems and opportunities facing theon problems and opportunities facing the
organization.organization.
Courtesy of VanCity
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Physical StructuresPhysical Structures
LanguageLanguage
Rituals and CeremoniesRituals and Ceremonies
Stories and LegendsStories and Legends
Communication NetworksCommunication Networks
HistoryHistory
BeliefsBeliefs
ValuesValues
AssumptionsAssumptions
Artifacts of
Organizational
Culture
OrganizationalOrganizational
CultureCulture
Elements of Organizational CultureElements of Organizational Culture
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Artifacts: Stories and LegendsArtifacts: Stories and Legends
(Heroes)(Heroes)Social prescriptions of desiredSocial prescriptions of desired(undesired) behavior(undesired) behavior
Provides a realistic human side toProvides a realistic human side toexpectationsexpectations
Most effective stories and legends:Most effective stories and legends:
Describe real peopleDescribe real people Assumed to be trueAssumed to be true
Known throughout the organizationKnown throughout the organization
Are prescriptiveAre prescriptive
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Artifacts: Rituals and CeremoniesArtifacts: Rituals and Ceremonies
RitualsRituals
programmed routinesprogrammed routines
(eg., how visitors are greeted)(eg., how visitors are greeted)
CeremoniesCeremonies
planned activities for an audienceplanned activities for an audience (eg., award ceremonies)(eg., award ceremonies)
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Artifacts: Physical Structures/SymbolsArtifacts: Physical Structures/Symbols
Building structureBuilding structure ---- may shape and reflectmay shape and reflectcultureculture Oakleys Interplanetary Headquarters in FoothillOakleys Interplanetary Headquarters in Foothill
Ranch, CaliforniaRanch, California
Office design conveys cultural meaningOffice design conveys cultural meaning
Furniture, office size, wall hangingsFurniture, office size, wall hangings
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Artifacts: OrganizationalArtifacts: Organizational
LanguageLanguageWords used to address people, describeWords used to address people, describecustomers, etc.customers, etc.
Leaders use phrases and special vocabularyLeaders use phrases and special vocabularyas cultural symbolsas cultural symbols
eg. Container Stores Being Gumbyeg. Container Stores Being Gumby
Language also found in subculturesLanguage also found in subcultures
eg. Whirlpools PowerPoint cultureeg. Whirlpools PowerPoint culture
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Artifacts: Cultural CommunicationArtifacts: Cultural Communication
NetworksNetworks Refers to the informal channels ofRefers to the informal channels of
interaction, typically used for influencinginteraction, typically used for influencing
members perceptions of reality andmembers perceptions of reality andindoctrinating them to hold the right andindoctrinating them to hold the right andbehave in the appropriate ways.behave in the appropriate ways.
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Organizational SubculturesOrganizational Subcultures
Located throughout the organizationLocated throughout the organization
Can enhance or oppose (countercultures)Can enhance or oppose (countercultures)firms dominant culturefirms dominant culture
Two functions of countercultures:Two functions of countercultures: provide surveillance and critique, ethicsprovide surveillance and critique, ethics
source of emerging valuessource of emerging values
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Types of Organizational CulturesTypes of Organizational CulturesStructuralStructural
(The factory)(The factory)
HumanHumanResourcesResources
(The family)(The family)
PoliticalPolitical
(The jungle)(The jungle)
SymbolicSymbolic
(The temple)(The temple)
Hierarchy and rulesHierarchy and rules
At its worstAt its worstdominated by egodominated by ego
Can be coldCan be coldbureaucratic andbureaucratic andstiflingstifling
AutocraticAutocratic--LeadersLeaders
can do no wrongcan do no wrongCan be beneficial toCan be beneficial toemployees whoemployees whoappreciate structureappreciate structure
Organization existsOrganization exists
to serve humanto serve humanneedsneeds
Relationships are atRelationships are atthe corethe core -- betweenbetweenpeople and with thepeople and with theorganizationorganization
Concerned withConcerned withhow well humanhow well humanneeds are metneeds are met
What motivatesWhat motivatespeoplepeople
Can result inCan result inmanipulation ormanipulation or
inability to meetinability to meetevery needevery need
Considered mostConsidered most
desirabledesirableConflict is inevitableConflict is inevitable
Ineffective leadersIneffective leadersuse attacks oruse attacks orthreats to get theirthreats to get theirwayway
Savvy leadersSavvy leadersrecognize powerrecognize powerplays can haveplays can havedisastrous resultsdisastrous resultsand make enemiesand make enemies
Prefer to usePrefer to usecompromise andcompromise and
cooperationcooperation
Organizations honorOrganizations honor
the beliefs, values,the beliefs, values,practices andpractices andlegacies that definelegacies that definethe culturethe culture
Seldom used todaySeldom used todaybut can be helpful inbut can be helpful incelebrating the pastcelebrating the past
and creating a bond.and creating a bond.
Symbols need to beSymbols need to beused carefully toused carefully toavoid backfiringavoid backfiring
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Organizational Culture Models cont.Organizational Culture Models cont.
Every organization has characteristics ofEvery organization has characteristics ofall four models.all four models.
The key is to determine which model isThe key is to determine which model isdominant.dominant.
Each can be functional or dysfunctional.Each can be functional or dysfunctional.
Each is related to a leadership philosophyEach is related to a leadership philosophyin terms of how organizations andin terms of how organizations andindividuals relate to one another.individuals relate to one another.
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Benefits of Strong CorporateBenefits of Strong Corporate
CulturesCultures
Strong
Organizational
Culture
SocialSocial
ControlControl
ImprovesImprovesSenseSense--MakingMaking
SocialSocial
GlueGlue
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Problems with Strong CulturesProblems with Strong Cultures
1.1. Culture content might be misaligned withCulture content might be misaligned withthe organizations environment.the organizations environment.
2.2. Strong cultures may focus on mentalStrong cultures may focus on mentalmodels that could be limitingmodels that could be limiting
3.3. Strong cultures suppress dissenting valuesStrong cultures suppress dissenting valuesfrom subcultures.from subcultures.
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Adaptive Organizational CulturesAdaptive Organizational Cultures
External focusExternal focus ---- firms success dependsfirms success dependson continuous changeon continuous change
Focus on processes more than goalsFocus on processes more than goals
Strong sense of ownershipStrong sense of ownership
ProactiveProactive ----seek out opportunitiesseek out opportunities
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Leadership PhilosophiesLeadership Philosophies
Organizations are shaped by their leaders.Organizations are shaped by their leaders.
Organizational cultures begin with the philosophies heldOrganizational cultures begin with the philosophies heldby the people who run the organization.by the people who run the organization.
Leadership Philosophies include:Leadership Philosophies include: Classical ManagementPhilosophyClassical ManagementPhilosophy Task vs. Relationship PhilosophyTask vs. Relationship Philosophy
Participative ManagementPhilosophyParticipative ManagementPhilosophy
Contemporary PhilosophiesContemporary Philosophies ValuesValues--drivendriven
InformationInformation--drivendriven CustomerCustomer--drivendriven
Learning OrganizationLearning Organization
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Classical ManagementPhilosophiesClassical ManagementPhilosophies
Began in late 18Began in late 18thth century with Adam Smiths Wealth ofcentury with Adam Smiths Wealth ofa Nations, as an attempt to increase productivity in aa Nations, as an attempt to increase productivity in apin manufacturing company.pin manufacturing company.
Stated that workers needed close supervision, clearStated that workers needed close supervision, cleardirection and careful discipline.direction and careful discipline.
Assumed that:Assumed that: employees could not be trustedemployees could not be trusted
work does not come naturally so they must be forced to do it.work does not come naturally so they must be forced to do it. managers do all the thinkingmanagers do all the thinking
Widely used during the Industrial RevolutionWidely used during the Industrial Revolution
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Classical Management ModelsClassical Management ModelsScientific ManagementScientific Management
(Frederick Taylor)(Frederick Taylor)
Theory X and Theory YTheory X and Theory Y
(Douglas McGregor)(Douglas McGregor)
Four SystemsFour Systems
(Rensis Likert)(Rensis Likert)
Structured and mechanisticStructured and mechanistic
Based on time and motionBased on time and motionstudiesstudies
People were like machinesPeople were like machines
Unfair and unrealisticUnfair and unrealistic
Jobs eliminated due toJobs eliminated due toefficiencyefficiency
Greatly opposed by unionsGreatly opposed by unionsduring the Depressionduring the Depression
Theory XTheory X --Direction and controlDirection and controlthrough authoritythrough authority
Lone decisionLone decision--making by CEOmaking by CEO
Creates a climate of fear andCreates a climate of fear andmistrustmistrust
Theory YTheory Y Productivity comesProductivity comeswith fulfilling higher order needswith fulfilling higher order needs --selfself--actualization.actualization.
People need to be selfPeople need to be self--directed.directed.
Four SystemsFour Systems organizationsorganizationsoperate on 4 levels accordingoperate on 4 levels accordingto: motivation, responsibility,to: motivation, responsibility,cooperation, and trustcooperation, and trust
System 1System 1 fear, mistrust,fear, mistrust,
suspicion, misinformationsuspicion, misinformationSystem 2System 2 rewards, somerewards, somepunishment, little cooperationpunishment, little cooperation
System 3System 3 rewards, littlerewards, littlepunishment, some cooperation,punishment, some cooperation,
System 4System 4 rewards,rewards,cooperation, mutual trustcooperation, mutual trust
CommunicationsCommunications
Exclusively downward throughExclusively downward througha chain of commanda chain of command
Conflicts resolved by CEOConflicts resolved by CEO
Complainers let goComplainers let go
CommunicationsCommunications
Theory XTheory X --Commands flowCommands flowexclusively top down throughexclusively top down throughcommand and control.command and control.
Theory YTheory Y Encourage upward,Encourage upward,downward and lateraldownward and lateralcommunications.communications.
Seeks feedback ,interaction,Seeks feedback ,interaction,openness and honesty.openness and honesty.
CommunicationsCommunications
System 1System 1 downward, hostiledownward, hostile
System 2System 2 downward need todownward need toknow, misinformationknow, misinformation
System 3System 3 downward,downward,accurateaccurate information providedinformation provided
System 4System 4 open, honest,open, honest,accurateaccurate
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Task vs. Relationship PhilosophiesTask vs. Relationship PhilosophiesBlake, Mouton, Blake and McCanseBlake, Mouton, Blake and McCanse
CONCERN FOR PRODUCTIONCONCERN FOR PRODUCTION
Country Club Management Team Management
Thoughtful attention to the needs of people
for satisfying relationships, friendly atmosphere
Middle of the Road Management
Impoverished Management Authority Compliance
CONCE
RN
FOR
PE
OP
LE
Work accomplishment is from
committed people,interdependence through acommon stake in organizationpurpose leads to trust andrespect
Adequate organization performance ispossible through balancing the necessity toget out the work with maintaining morale ofpeople at a satisfactory level
Exertion of minimum effort to getrequired work done is appropriate
to sustain organizationmembership.
Efficiency in operations results fromarranging conditions of work in such a
way that human elements interfere toa minimum degree.
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Situational Leadership PhilosophySituational Leadership Philosophy
Hershey and BlanchardHershey and Blanchard Effective leaders vary their styles with the readiness of theEffective leaders vary their styles with the readiness of the
followers.followers.
Subordinates maturitySubordinates maturity -- The employees ability (job maturityThe employees ability (job maturity --knowledge and skills) and willingness (psychological maturityknowledge and skills) and willingness (psychological maturity --motivation and commitment) to take responsibility for directing ownmotivation and commitment) to take responsibility for directing own
behavior in accomplishing a task.behavior in accomplishing a task. Life Cycle Theory of LeadershipLife Cycle Theory of Leadership -- Identifies four leadership stylesIdentifies four leadership styles--
telling, selling, participating and delegating. In terms of the amounttelling, selling, participating and delegating. In terms of the amountof directive and supportive behavior provided.of directive and supportive behavior provided.
Low psychological and job maturityLow psychological and job maturity -- tasktask--oriented leadershiporiented leadership
increasesincreases Job and psychological maturity increasesJob and psychological maturity increases tasktask--orientedoriented
decreases, relationshipdecreases, relationship--oriented increasesoriented increases High job and psychological maturityHigh job and psychological maturity decrease in task anddecrease in task and
relationship behaviorrelationship behavior
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Participative ManagementParticipative Management
PhilosophiesPhilosophies Focuses on the extent to which decisionFocuses on the extent to which decision--
making power is vested entirely at the topmaking power is vested entirely at the top
or shared with lower levels of theor shared with lower levels of theorganization.organization.
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Participative ManagementPhilosophiesParticipative ManagementPhilosophiesJapanese PhilosophyJapanese Philosophy
Type zType z
Teamwork PhilosophyTeamwork Philosophy SelfSelf--ManagementManagementPhilosophyPhilosophy
Bottom up initiativeBottom up initiative changechangeshould come from thoseshould come from thoseclosest to the problemclosest to the problem encourages bottom upencourages bottom up
communications.communications.Top management asTop management asfacilitatorfacilitator ideas areideas areencouraged managers do notencouraged managers do nothave the all the answers.have the all the answers.
Middle management asMiddle management asimpetus for solutionsimpetus for solutions perceive problems andperceive problems and
generate solutions (RCLs)generate solutions (RCLs)horizontal and bottom uphorizontal and bottom upcommunication required.communication required.
Consensus decisionConsensus decision--makingmaking alternative solutions sought,alternative solutions sought,no one right way, consensusno one right way, consensussought, commitment tosought, commitment tochoice. Concern for employeechoice. Concern for employeewellwell--beingbeing personal andpersonal androfessional wellrofessional well--bein im t.bein im t.
Characterized by openCharacterized by opencommunications that flowscommunications that flowsup, down and lateralup, down and lateral cutscutsacross all boundaries.across all boundaries.
Asserts that the entireAsserts that the entireorganization should functionorganization should functionas teams with each levelas teams with each levelparticipating in decisionparticipating in decision--making and problemmaking and problem--solving.solving.
Shared responsibilityShared responsibility nonolone ranger.lone ranger.
More complex taskMore complex task bestbestassigned to teams.assigned to teams.
Spontaneous problemSpontaneous problem--solving is encouraged.solving is encouraged.
Conflicts resolved at lowestConflicts resolved at lowestpossible levels.possible levels.
Initial training in groupInitial training in groupdynamics, problemdynamics, problem--solvingsolvingand scope of responsibilityand scope of responsibilityand authority provided byand authority provided by
management.management.
Leadership emergesLeadership emergesinformally among members.informally among members.
Those with groupThose with groupcommunication skillscommunication skillsemerge as informal leaders.emerge as informal leaders.
Requires a great deal ofRequires a great deal ofmutual trust.mutual trust.
Middle management mayMiddle management maybe threatened.be threatened.
Takes long time toTakes long time toimplement and may beimplement and may becostly in terms of trainingcostly in terms of training
Not suitable for everyone.Not suitable for everyone.
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OrganizationOrganization--Based PhilosophicalBased PhilosophicalApproachesApproaches ValuesValues--Driven PhilosophyDriven Philosophy
ValuesValues--Driven PhilosophyDriven Philosophy based upon the works of Steven Covey argues thatbased upon the works of Steven Covey argues thateffective organizations live according to clear widelyeffective organizations live according to clear widely--supported set of values.supported set of values.Developed the 7 Habits of Highly Effective People that included: be proactive, beginDeveloped the 7 Habits of Highly Effective People that included: be proactive, beginwith the end in mind, put first things first, think win/win, seek first to understandwith the end in mind, put first things first, think win/win, seek first to understandthen be understood, synergize, sharpen the saw.then be understood, synergize, sharpen the saw.
Later he advocated using the habits on four levels:Later he advocated using the habits on four levels: OrganizationalOrganizational to align organizations and individualsto align organizations and individuals ManagerialManagerial to achieve empowerment of others.to achieve empowerment of others. InterpersonalInterpersonal to build trustto build trust PersonalPersonal to achieve trustworthiness in the eyes of othersto achieve trustworthiness in the eyes of others
Communications behaviors that assist in PrincipleCommunications behaviors that assist in Principle--Centered Leadership include:Centered Leadership include: Listening before explainingListening before explaining Involving others to produce win/win solutionsInvolving others to produce win/win solutions
Refrain from making negative or unkind statementsRefrain from making negative or unkind statements Admitting mistakesAdmitting mistakes Apologizing asking for forgivenessApologizing asking for forgiveness
This approach takes into account how and what the organization communicates.This approach takes into account how and what the organization communicates.
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InformationInformation--Driven PhilosophyDriven Philosophy
A combination of classical and valuesA combination of classical and values--driven the opendriven the open--book leadershipbook leadershipphilosophy holds that employees efforts should be guided and motivated byphilosophy holds that employees efforts should be guided and motivated byinformation.information.
Advocates use of a a balanced scorecard that measures:Advocates use of a a balanced scorecard that measures: Financial performance, customer knowledge, internal business processes, andFinancial performance, customer knowledge, internal business processes, and
learning and growing for alignment and motivation.learning and growing for alignment and motivation.
Open book managementOpen book management encourages thinking and acting like a businessencourages thinking and acting like a businesspartner. Based on the notion that employees want to know their industrypartner. Based on the notion that employees want to know their industryand will act responsibly as a result. Leaders should therefore:and will act responsibly as a result. Leaders should therefore: Make full information availableMake full information available Build business literacyBuild business literacy Empower employees to act on informationEmpower employees to act on information Create reward structuresCreate reward structures
This approach is heavily communication oriented and assumes employeesThis approach is heavily communication oriented and assumes employeeswill perform when they understand the big picture.will perform when they understand the big picture.
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CustomerCustomer--Driven PhilosophyDriven Philosophy Albrecht and Zemke in Service AmericaAlbrecht and Zemke in Service America -- A combination of valuesA combination of values--drivendriven
and informationand information--driven philosophies, whereby everything in the organizationdriven philosophies, whereby everything in the organization
leads to customer satisfaction.leads to customer satisfaction.
Driven by the notion that organizations perform, not produce thereforeDriven by the notion that organizations perform, not produce thereforesuccess is determined by each moment of truth as customers are served.success is determined by each moment of truth as customers are served.
The traditional pyramid of authority needs to be turned upside down so thatThe traditional pyramid of authority needs to be turned upside down so thatthose who serve the customers become the central focus of management.those who serve the customers become the central focus of management.
Communication practices include:Communication practices include:
Crete a customerCrete a customer--keeping vision through top down communicationskeeping vision through top down communications Saturate the company with the voice of the customerSaturate the company with the voice of the customer Empower employees to make decisions/solve problems on customer behalfEmpower employees to make decisions/solve problems on customer behalf Emphasis on measuring satisfaction at individual, team and organizational levels.Emphasis on measuring satisfaction at individual, team and organizational levels. Walk the talkWalk the talk demonstrate values and customer focus, particularly leadership.demonstrate values and customer focus, particularly leadership.
WiersemaWiersema Argues that communications and relationships should be usedArgues that communications and relationships should be usedto achieve customer intimacy which is characterized by judgment,to achieve customer intimacy which is characterized by judgment,cooperation and learning.cooperation and learning.
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Learning Organization PhilosophyLearning Organization Philosophy Peter Senge in the Fifth Discipline, combines valuesPeter Senge in the Fifth Discipline, combines values--based,based,
teamwork, and information driven approaches that asserts that inteamwork, and information driven approaches that asserts that inorder for organizations to survive they must become learningorder for organizations to survive they must become learningentities characterized by five disciplines:entities characterized by five disciplines:
Systems thinkingSystems thinking-- interconnectedness of the organizationinterconnectedness of the organization
Personal masteryPersonal mastery individual mastery achieved through selfindividual mastery achieved through self--actualization.actualization. Mental modelsMental models assumptions of the world that influence decisionassumptions of the world that influence decision--
makingmaking Build shared visionBuild shared vision a collective vision of the futurea collective vision of the future Team learningTeam learning Using dialogue to create synergistic teams.Using dialogue to create synergistic teams.
Gifford and PinchotGifford and Pinchot adds the dimension that organizations mustadds the dimension that organizations mustengage the intelligence, judgment, etc. of everyone in theengage the intelligence, judgment, etc. of everyone in theorganization to be responsive to customers.organization to be responsive to customers.
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Seven Leadership CompetenciesSeven Leadership Competencies
Emotional IntelligenceEmotional Intelligence
IntegrityIntegrity
DriveDrive
Ability to perceive,Ability to perceive,express, regulateexpress, regulateemotions in self andemotions in self andothersothers
Refers to the truthfulnessRefers to the truthfulnessand ability to translateand ability to translatewords into deedswords into deeds
Inner motivation toInner motivation topursue goals.pursue goals.
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Seven CompetenciesSeven Competencies
Leadership motivationLeadership motivation
SelfSelf--confidenceconfidence
IntelligenceIntelligence
Knowledge of theKnowledge of thebusinessbusiness
Socialized power used toSocialized power used toaccomplish goals.accomplish goals.
Belief in ones own skillsBelief in ones own skillsand abilities.and abilities.
Cognitive ability toCognitive ability toprocess large amounts ofprocess large amounts ofinformation.information.
Understanding of theUnderstanding of thecompanys environmentcompanys environmentto make intuitiveto make intuitivedecisions.decisions.