Professional Documents
Culture Documents
2 5 Organizational and Corporate Structure
2 5 Organizational and Corporate Structure
Defined as what is normal to the organizations; how workers behave w/in the
business
Set of norms (based on mission and vision)
Helps people fit in based on the organization’s traditions and routines
A manager has to understand in order to:
Train the employees to fit company norms
Improve communications between employees
Better job description
Other groups conform to subcultures, which can cause conflicts or culture gaps
Culture gaps are discrepancies among subgroups
Difference between cultures exists within a business
Elements of organizational culture
N.O.R.M.S (nature of business, organizational structure, rewards, management
styles, sanctions)
External factors such as location can also affect corporate culture (concern from
cross border joint ventures)
Advantages of strong organizational culture
Belonging and security
Reducing mistakes
Team cohesiveness
Minimizes culture clash/gap
Cultures can change due to:
Mergers, takeovers, acquisitions
Change in NORMS
Types of organizational cultures
Charles Handy’s 4 Types of Culture
Power culture
Power is centralized, quick decision making
Results-based, likely flat
Role culture
Jobs are clearly stated, little creativity
Highly structured, tall organization/bureaucratic
Task culture
Focuses on getting results from work done
Individuals and teams are empowered and given flexibility
Decentralized power
Person culture
Staff have similar positions with similar expertise
Staff form groups to share knowledge
Individual may benefit which may carryover to firm
Edgar Schein’s 3 levels of corporate culture:
Artifacts (e.g. history, facilities, buildings, dress code, etc.)
Espoused values (e.g. mission, branding, slogans, etc.)
Basic assumptions and values (values in behavior/action)
Deal and Kennedy
Corporate culture is the way things get done
Two dimensions feedback/reward and risk
Rapid feedback means bad culture is quickly removed
High risk businesses needs people that fit well in their culture
4 types of culture:
Tough-guy Macho (rapid feedback, high risk)
e.g. stock market, police force
Work-hard, Play-hard (rapid feedback, low risk)
Stress from pace of work instead of risk (e.g. hotel)
Bet-the-company (slow feedback, high risk)
e.g. oil exploration, pharmaceuticals
Process (slow feedback, low risk)
e.g. governments, insurance (bureaucracy)
Knotted and Heskett
Adaptive cultures – flexible work practices, entrepreneurial
Inert cultures – strict work protocols
Goffee and Jones
Sociability – extent of concern for colleagues
Solidarity – cohesiveness/unity in the organization
Ideal culture will have high sociability and solidarity
Gerry Hofstede
Several factors in culture:
Power distance – extent of unequal power distribution
High – centralized
Low – decentralized, delegation
Individualism vs. collectivism
Masculinity vs. femininity
Uncertainty avoidance
Long-term vs. short-term
Culture clashes
Occurs when there conflict between subcultures in an organization
May lead to lowered productivity, staff walkouts, losses
Happens during times of change
e.g. takeovers, acquisitions, mergers, expansions
Common causes
High cost of implementing change
Resistance to change from workforce
Public opinion
Difference in national cultures (e.g. job practice)
Importance of understanding the organizational culture
Culture gaps can cause major problems since individuals affect culture as much as
the other way around
Poor culture may lead to absenteeism, lateness
Cultural intelligence or cultural quotient
Ability of individual to blend into a culture; attitude of workers to change
Rational, motivated, and attentive workers help establish good culture