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Chapter # 16: Organizational Culture

What Do Cultures Do?


14.Compare the functional and dysfunctional effects of organizational
culture on people and the organization.
Exam Q: What are functional and dysfunctional effects of organizational
culture?
Exam Q: Explain and discuss functional and dysfunctional effects of
organizational culture?
Exam Q: Culture is software brain. Explain this concept and Compare the
functional and dysfunctional effects of organizational culture on people
and productivity.( Two Times)
Differentiate between functional and dysfunctional effects of
organizational culture? (Two Times)
Functional Effects:
Following are the functional effects of Culture:
a)
b)
c)
d)

Defining Boundaries
Conveying Identity
Promoting Commitment
Controlling Behavior

a) Defining Boundaries
Culture has a boundary-defining role.
Culture creates distinctions between one organization and others.
b) Conveying Identity
Culture conveys a sense of identity for organization members.
Who receives a job offer to join the organization, who is appraised as a high
performer, and who gets the promotion is strongly influenced by the
individual-organization fit.
c) Promoting Commitment
Culture facilitates the generation of commitment to something larger
than self-interest.
Chapter # 1 Exam Notes

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d) Controlling Behavior
Culture serves as a sense-making and control mechanism that guides
and shapes the attitudes and behavior of employees for fitting
employees in the organization
Every organization develops a core set of assumptions, understandings,
and implicit rules that govern day-to-day behavior in the workplace.
Culture enhances the stability of the social system.
Dysfunctional Effects or Culture as liability
Following are the functional effects of Culture:
a) Barrier to change
b) Barrier to diversity
c) Barrier to acquisitions and mergers
a) Barrier to change
When cultures are strong, they can become a barrier to change.
Barrier to change occurs when cultures values may not align with the
values needed to embrace or facilitate the change.
This is most likely to occur when an organizations environment is dynamic.
b) Barrier to diversity
Strong cultures put considerable pressure on employees to conform, which
may lead to institutionalized bias.
Cultures that may pressure employees to conform can be a barrier to
hiring, developing, and promoting a diverse workforce.
Organizations seek out and hire diverse individuals because of their
alternative strengths.

Chapter # 1 Exam Notes

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c) Barrier to acquisitions and mergers


Historically, the key factors that management looked at in making
acquisition/ merger decisions:
Financial advantages
Product synergy
Cultural compatibility has become the primary concern.
Incompatible cultures can destroy an otherwise successful merger.
Finally, if a merger or acquisition occurs, one of the most difficult things to
do is to merge the two cultures, causing many mergers to fail.

Chapter # 1 Exam Notes

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