You are on page 1of 18

Organization Culture

The Nature of Organization Culture

Culture as the key to an organizations success and suggested that managers who could manage though their organizations culture almost certainly would rise to top.

What is Organization Culture?

Three common attributes of Organization Culture

O Set of values held by individual in an


o Values defined as the good or acceptable

behavior and bad or unacceptable behavior.

O The values that make up an organizations are

often taken for granted.

O An emphasis on the symbolic means through

which the values in an organizations culture are communicated.

O Organization Culture is a set of shared

values often taken for granted, that help people in an organization understand which actions are considered acceptable and which are considered unacceptable. Often these values are communicated through stories and other symbolic means.

Historical Foundations
O Anthropological Contribution

O The study of human cultures and cultural phenomena.

O Anthropologists seek to understand how the values and

beliefs that make up a societys culture affect the structure and functioning of that society.
O Sociological Contributions O The study of people in social systems such as

organizations and societies. O Emile Durkheim argued that the study of myth and rituals is an essential complement to the study of rational behavior in societies.

Historical Foundation (Cont.)

O Social Psychology Contributions O A branch of psychology that includes the study of groups and the influence of social factors on individuals. O Economics Contributions
O It attempts to link the cultural attributes of firms with

their performances rather than simply describing the cultures of companies.

Organization Culture vs. Organizational Climate

Organizational Climate Organization Culture Based on individual perception. Refers to current situations in the organization and the linkages among work groups, employees, and work performance. Refers to the historical context within which a situation occurs and the impact of this context on the behavior of employees.

Creating the Organization Culture

Formulate Strategic Values

Develop Cultural Values

Create Vision

Initiate Implementati on Strategies

Reinforce Cultural Values

Company succeeds as a result of what the company does and how the company does it."

Creating the organization culture

Process in Creating the Organization Culture:
Establish Values
Formulate Strategic Values

o Are the basic beliefs about an organizations environment that

shape its strategy.

Develop Cultural Values

o Are the values that the employees need to have and act on for

the organization to act on the strategic values.

Create a Vision
o Vision is a picture of what the organization will be like at

some point in the future.

Creating the organization culture

Initiate Implementation Strategies

Builds on the values and initiates the action to accomplish the vision.

Reinforce Cultural Behaviors o The act of monitoring and encouraging these behaviors of employees as they act out the cultural values and implement the organizations strategies

Reinforce can take many forms:

o The formal reward system in the organization

must reward desired behaviors in ways that employees value. o Stories must be told throughout the organization about employees who engaged in behaviors that epitomize the cultural values. o The organization must engaged in ceremonies and rituals that emphasize employees doing the things that are critical to carrying out the organizations vision.

Approaches to describing Organization Culture

O Ouchi Frameworks O The Peters and Waterman Framework

Ouchi Framework
O William G. Ouchi
O Analyzed the organization cultures of three

groups firms, which he characterized as:

O Typical U.S firms O Typical Japanese firms O Type Z U.S firms

Seven Points of comparison developed by Ouchi

O Commitment to employees O Evaluation

O Careers
O Control O Decision Making

O Responsibility
O Concern for People

The Ouchi Framework

O Type Z U.S. firms o Committed to retaining employees o Evaluate workers performance based on qualitative

o o

o o

and quantitative information Emphasize broad career paths Exercise control through informal/implicit mechanisms Require that decision making occur in groups Are committed to full information-sharing Expect individuals to take responsibility for decisions Emphasize concern for people

The Ouchi Framework

O Ouchi argued that the cultures of typical

Japanese firms and U.S. Type Z firms are very different from those of typical U.S. firms, and that these differences explain the success of many Japanese firms and U.S. Type Z firms and the difficulties in typical U.S. firms.