ORGANIZATIONAL CULTURE

ORGANIZATIONAL CULTURE
THE GLUING FACTOR

SUBMITTED TO:
Prof. Mousami Bhattacharya&Dr. Nilanjan Sengupta

SUBMITTED BY: Group No. 6 Arun Aggarwal(6) Krishna Kant(12) Nithya Sridhar(18) Preeti Jaiswal(24) Sachin.V(30) Shashank(36) Sobhonson(42) Swagatika(48) V.Deepika(54) Yatindra(60)
1|P ag e

ORGANIZATIONAL CULTURE

ACKNOWLEDGEMENT

We wish to convey our heartiest thanks to Prof.Mousumi Bhattacharya & Dr. Nilanjan sengupta who has given us all an opportunity to work on this project. We are grateful to them for their constant guidance throughout the project. It was a fight in the beginning to gather all the information from various organizations about their cultures; however, through the constant efforts of our team members, we made this project a success. Working on this project has given us an insight about how the various organizations formulate their cultural values. We have been able to connect our theoretical knowledge with the practical working conditions of various organizations. It has been a boon working on the following project and we once again wish to thank our faculty members and the team, without whom this project would not have been a success.

2|P ag e

However. When people join an organization. are the subcultures in an organization. and feel in relation to those problems. or illegitimate practices under the control of their employers. discovered or developed by a given group. The values that create dominant cultures in organizations help guide the day-to-day behavior of the employees. organization culture is a common perception held by the organization¶s members. A subculture is a set of values shared by a minority. in the sense that they are embedded in specific societal cultures and are part of them. attitudes and beliefs of an organization which can foster or impede change. all may not do so to the same degree. at least as anthropology uses the concept. immoral. A dominant culture is a set of core values shared by a majority of the organization¶s members. usually a small minority of the organization¶s members. of the core values of the dominant culture. Important. The person needs to learn how the particular enterprise does things. however these values and beliefs are insufficient for helping the individual succeed in the organization. A common misconception is that an organization has a uniform culture. it is probably more accurate to treat organizations ³as if´ they had a uniform culture. as it learns to cope with the problems of external adaption and internal investigation that has worked well enough to be considered valid and therefore is to be taught to the new members as the correct way to perceive. Quite often. Subcultures can weaken and undermine an organization if they are in conflict with the dominant culture and overall objectives. A NEW CONCEPT: WHISTLE BLOWING Whistle blowing is commonly defined as "the disclosure by organization members (former or current) of illegal. to 3|P ag e . they bring with them the values and beliefs that they have been taught. Subcultures typically are a result of problems or experiences that are shared by members of a department or unit. However. norms. think. but often overlooked. Successful firms. Most subcultures are formed to help the members of a particular group deal with the specific day-to-day problems with which they are confronted.ORGANIZATIONAL CULTURE ORGANIZATIONAL CULTURE: Organizational culture is defined as a pattern of basic assumptions invented. values. ³All organizations have culture. there can be a dominant culture as well as subcultures throughout a typical organization. The members may also support many. however find that this is not the case always. Everyone in the organization would have to share this perception. As a result. if not all.´ According to this view. Organizational culture is a set of shared understandings.

the first step in supporting employee communication and reporting behaviors is to influence a culture that promotes not only awareness of an organization's commitment to integrity. the most fundamental and powerful values of an organization are not written down and exist only in the shared norms. A FEW DIMENSIONS OF ORGANIZATIONAL CULTURE VIGILANCE Prior to pondering whether or not to communicate an ethical. and it has been found that the majorities of employees who become aware of individual or corporate wrongdoing never report or disclose their observations to anyone. beliefs. and assumptions reflected in the organization's culture. While whistleblowing includes disclosures both internal and external to the organization. beliefs. and personal factors. To promote a shared understanding of which "code" to follow. government scrutiny. their concerns regarding organizational conduct ranging from slight indiscretions and unprofessional behaviors to criminal acts warranting felony convictions. To encourage internal reporting organizational ethics and compliance programs often include the availability of an anonymous or confidential reporting channel that enables employees the opportunity to report. an employee must first be in a position to detect violations. Internal reporting facilitates early detection of misconduct and creates opportunity for timely investigation and corrective action.ORGANIZATIONAL CULTURE persons or organizations that may be able to effect action". Internal reporting also positions organizations to proactively manage. A look out for threats to organizational integrity also must be cultivated among organization members. The organizational culture informs members how to relate to each other and to outsiders. however. and how to respond to situations encountered in the organization. or even avoid public embarrassment. An employee's decision to report individual or organizational misconduct is a complex phenomenon that is based upon organizational. is limited. costly fines. and assumptions guide how organization members think and act. or legal concern. how to analyze problems. However. compliance. without fear of retaliation. "What are the standards in this organization?" "What is my role in upholding these standards?" Accordingly. Employee utilization of these reporting channels. organizations benefit when employees choose to report internally. These norms. Numerous variables have been studied in the literature for their relationship to whistleblowing. the formal code of conduct or the unwritten code of 4|P ag e . and litigation. situational. Thoughtful attention to training employees on the values and standards outlined in the organization's code of conduct will facilitate awareness building. but a shared understanding of organizational standards.

however. and legal breaches. employees also must be educated on the relationship between organizational integrity and the organization's strategic positioning. Leadership behavior is a key determinant of employee perceptions and beliefs. On the other hand. may not be sufficient for prompting employee disclosures. The result is decreased commitment and an unwillingness to exert effort on behalf of the organization. Such conflict will arise when organizational demands on employees are inconsistent with personal or professional values. psychological contracts. including training on ethical standards can be used to deepen employee commitment to organizational values and norms. If an organization member is not committed to high ethical standards there may be a tendency to rationalize questionable behavior as a common or even necessary practice in performing job duties. socialization methods.ORGANIZATIONAL CULTURE culture. Engagement is concerned with organizational and individual factors that contribute to a personal state of authentic involvement in the organization. its reputation. there is a tendency for the employee to experience internal conflict. To support a culture of vigilance. orient. the dynamics of organizational culture on an employee's ability to accurately interpret the ethical standards of the organization must be addressed. Once employees enter the organization. and manage employees influence engagement. CREDIBILITY A culture of engagement that supports organizational commitment and identification. Organizational processes used to recruit. and perceptions of fairness in organizational dealings influence the degree of authentic involvement by them. the organization should ensure employees are in a position to identify the potential consequences of ethical. Therefore. Managing these organizational processes and individual perceptions to facilitate high degrees of organizational commitment and identification encourages a culture of engagement that supports internal whistle blowing. if an employee has high ethical standards that are not supported by the organization. compliance. An employee will also seek to "test" the organization's commitment to integrity. Employees who observe wrongdoing may not report it because they cannot fully estimate the resulting damage. and stakeholders. ENGAGEMENT The cultural dimension of engagement is multifaceted and complex. Employee¶s sense making. socialize. 5|P ag e . including opportunity costs and harm to the organization.

Demonstrating personal commitment to organizational values builds trust and creates a safe environment for employees to come forward and report concerns. building and so on At this point. the process usually involves some version of the following steps: A single person (founder) has an idea for a new enterprise The founder brings in one or more other key people and creates a core group that shares a common vision with the founder The founding core group begins to act in concert to create an organization by raising funds. "Is it my job to report?" "Isn't this someone else's responsibility?" "Why should I get involved? After all. and norms embedded in the organizational culture and picked up by employees will influence employee reflections. beliefs. ACCOUNTABILITY Accountability for communicating knowledge of wrongdoing will be carefully judged by employees. McDonald¶s: Ray Kroc worked for many years as a salesperson for a food supplier. others are brought into the organization and a common history begins to be built Most of today¶s successful corporate giants in all industries basically followed these steps. HOW DID ORGANIZATIONAL CULTURE START While organizational cultures developed in different ways. One day Kroc received a large order for multimixers from the McDonald brothers. He also had an entrepreneurial streak and began a sideline business with a partner." Again. Three well-known representative examples are Motorola. values. incorporating. McDonald¶s and Wal-Mart. The order intrigued Kroc and he decided to look in on the operation the next 6|P ag e .ORGANIZATIONAL CULTURE The most powerful strategy that can be relied upon to facilitate credibility is employee belief in espoused ethics and values including organizational expectations for employee disclosure. locating space. They sold multimixers. obtaining patents. The role of leadership is central to this strategy. machines that were capable of mixing up to six frozen shakes at a time. attending to and monitoring congruence in the organizational culture. I am not the only one aware of what is going on here. He learned how retail food operations were conducted. Aligning leadership behaviors with formal policies and consistent modeling of espoused values are important practices for fostering credibility.

Wal-Mart: Sam Walton. At the same time. opened his first Wal-Mart store in 1962. founder of Wal-Mart Stores. the company has a communication network worthy of the Pentagon. This training ensures that the franchisees all over the world are operating their units in the same way. new employees receive videotaped messages from the late Mr. Artifacts of culture are: PERSONAL ENACTMENT RITES AND CEREMONIES STORIES AND LEGENDS 7|P ag e . he built the franchisee on four basic concepts: quality. Here they learn the McDonald cultural values and the proper way to run the franchisee. When he did. his legacy and cultural values continue. efficiency and customer service. Everyone is taught this culture and is expected to operate according to the core cultural values of hard work. It includes everything from a six-channel satellite system to a private air force of numerous planes. Wal-Mart has not only become the largest retailer but also one of the biggest firms in the country. Kroc. Today. cleanliness. service and price. Although Sam died a few years ago.. Kroc became convinced that the McDonald¶s fast food concept would sweep the nation.ORGANIZATIONAL CULTURE time he was in their area. He bought the rights to franchise McDonald¶s units and eventually bought out the brothers. he began developing effective inventory control systems and marketing techniques. but the culture he left behind is still very much alive in McDonald¶s franchisees across the globe. Focusing on the sale of discounted name brand merchandise in small town markets. LEVELS OF CULTURE: ARTIFACTS VALUES BASIC ASSUMPTIONS ARTIFACTS: Artifacts are the most visible and accessible level of culture. At the same time. Inc. In order to ensure that each unit offers the customer the best product at the best price franchisees are required to attend McDonald University. It is symbol of culture in the physical and social work environment of the organization. Kroc died several years ago. he began to set up more and more stores in the Sun Belt. In fact. To ensure that these values get out to all the associates. where they are taught how to manage their business.

CEREMONIES AND RITES: Set of activities that are enacted time and again on important occasion. Retirement dinner RITES OF RENEWAL: Rites of renewal show the holistic changing in organization by enhancing the dedication towards learning and growth. through the examination of the behavior of organization members.ORGANIZATIONAL CULTURE RITUALS SYMBOLS PERSONAL ENACTMENT: Personal enactment is a behavior that reflects the value of organization. RITES OF INTEGRATION: 8|P ag e . Rites to the employees can be awarded as Rites of passage rites of renewal Rites of integration Rites of conflict reduction Rites of degradations RITES OF PASSES: Rites of passes show the changed status of individuals in the respected organization.It provides the opportunity to reward and recognize the employees whose behaviors are according to the values of the organization.

STORIES AND LEGENDS: Stories are the most effective way to reinforce the organizational values. 9|P ag e . cultural fest are the rites of integration in the organization. demotion in the organizational post. reduction in salary can be under the rites of degradation. RITES OF COFLICT REDUCTION: Its primal objective is to dwindle the disagreements and keep up with the positive environment inside the organization by satisfying the tangible and intangible needs of the employee. annual picnic. RITES OF DEGRADATION: It is basically punishment oriented and organization people may be punished visibly if they don¶t follow the organizational norms.Company function. SYMBOLS: Symbols are again one important artifact of the organization which communicates about the organizational culture by unspoken messages. it give meaning and identity to the organizations and very helpful in orienting new employees. Stories can be delivered in different ways Stories about the boss Stories about getting fired Stories about company details Stories about employees Stories about rules RITUALS: Rituals are unwritten and shows the way the employee follow the things to be done in the organization. Grievance hearing.ORGANIZATIONAL CULTURE It emphasize on the commitment of the employees by uniting diverse group within the organization. negotiation of union contracts isrite of conflict reduction. These are the everyday organizational practices repeated over and over. Ribbon of shame.

it is often consciously articulated both in conversation and the company¶s mission statement or annual report. VALUE REINFORCEMENT: Values in the organization can be reinforced by the cultural activities. CONTROL MECHANISM: In shaping the behavior of members in the organization culture plays the big role. FUNCTIONS OF ORGANIZATIONAL CULTURE: These are the functions being served by the organization Sense of identity Sense ± making device Reinforcing the values in organization Control mechanism for shaping behavior SENE OF IDENTITY: Culture provides a sense of identity to the members and enhances their commitment towards the organization. a firm¶s values and how it promotes and publicizes them can also affect workers feeling about their job and themselves.ORGANIZATIONAL CULTURE VALUES: Values reflect a person¶s underling believes in the organization. CULTURAL PERPECTIVES: 10 | P a g e . SENSE MAKING DEVICE: Culture in the organization provides the employees to interpret the meaning of the organizational events. ASSUMPTIONS: Assumptions are deeply held believes that guide behavior and awakens the members of the organization how to perceive and go about the things.

Newcomers learn the culture through organizational socialization ± ³The process by which newcomers are transformed from outsiders to participating. STAGES OF THE SOCIALIZATION PROCESS The organizational socialization process is generally described as having three stages: 11 | P a g e . The process is also a vehicle for bringing newcomers into the organizational culture. THE ADAPTATION PERSPECTIVE: The cultures that help organizations adapt to environmental change are deeply associated with excellent performance. THE FIT PERSPECTIVE: Fit perspective argues that the culture of the organization is valid. It encourages confidence and risk taking capacity among the employees.It states that organization with strong culture performs better than other organizations. effective members of the organizations´. if it fits the industry or firm¶s strategies.ORGANIZATIONAL CULTURE THE STRONG PERSPECTIVE THE FIT PERSPECTIVE THE ADAPTATION PERSPECTIVE THE STRONG PERSPECTIVE: The strong culture facilitates performance with the intensity visible to the outsiders. It is useful in explaining short term performances. LEADERS ROLE IN SHAPING CULTURE: WHAT LEADERS PAY ATTENTION TO HOW LEADERS REACT TO THE CRISES HOW LEARERS BEHAVE HOW LEADERS ALLOCATE REWARDS HOW LEADERS HIRE AND FIRE PEOPLE ORGANIZATIONAL SOCIALIZATION: Another process that perpetuates culture is the way it is handed down from generation of employees.

and creativity is valued. ANTICIPATORY SOCIALIZATION The first stage encompasses all of the learning that takes place prior to the newcomer¶s first day on the job. Learning to perform tasks is related to the organization¶s culture. encounter. This stage commences on the first day at work and is thought to encompass the first six to nine months on the new job. ROLE DEMAND Role demand involves the expectations placed on newcomers. Encounter. It includes the newcomer¶s expectations. newcomers are given considerable latitude to experiment with new ways to do the job. One thing newcomers should receive information about during entry into the organization is the culture. There are two types of Congruence between an individual and an organization: Congruence between the individual¶s abilities and the demand of the job. It is also important in terms of newcomer adjustment. clarify their roles. ENCOUNTER The second stage of socialization. The way newcomers approach these demand depends in part on the culture of the organization. and the fit between the organization¶s values and the individual¶s values. 12 | P a g e . Realism is the degree to which a newcomer holds realistic expectations about the job and about the organization. Newcomers may not know exactly what is expected of them or may receive conflicting expectations from other individuals. The two concerns at this stage are: Realism. Value Congruence is particularly important for organizational culture. In some organization¶s. is when newcomers learn the tasks associated with the job. TASK DEMAND Task demand involves the actual work performed. Information about values at this stage can help newcomers begin to construct a scheme for interpreting their organizational experiences.ORGANIZATIONAL CULTURE Anticipatory Socialization. Congruence. and establish new relationships at work. Change and Acquisition.

Newcomers are exposed to these values through the role models they interact with. and group pressure are interpersonal demand. While the transmission of information about cultural artifacts is relatively easy. High levels of organizational commitment are also marks of successful socialization. change and acquisition. They become proficient at managing their tasks. OUTCOMES OF SOCIALIZATION Newcomers who are successful socialized exhibit good performance. Newcomers adopt the company¶s norms and values more quickly when they receive positive support from organizational insiders. and engaging in relationship at work. The communication of organizational assumption is almost impossible. the transmission of value is more difficult. newcomers understand and adopt the organizations values and norms. 13 | P a g e . The primary purpose of socialization is the transmission of core values to new organization members. Successful Socialization is also signaled by mutual influences. Leadership style. SOCIALIZATION AS CULTURAL COMMUNICATION Socialization is a powerful cultural communication tool. When socialization is effective. CHANGE AND ACQUISITION In the third and final stage of socialization. Politics. All of them reflect the values and assumptions that operate within the organization. they should exhibit low levels of distress symptoms. and the behavior they observe being rewarded and punished. and the intention to stay with the organization. high job satisfaction. newcomers begin to master the demands of the job.ORGANIZATIONAL CULTURE INTERPERSONAL DEMAND Interpersonal demand arises from relationships at work. the training they receive. The end of the process is signaled by newcomers being considered by themselves and others as organizational insiders. clarifying and negotiating their roles. This provides employees a context for interpreting and responding to things that happen at work. In addition.

the fundamental assumptions and basic values that drive the organization may need to be altered. The areas are task support task innovation social relationships and personal freedom. Using Maslow¶s motivational need hierarchy as its basis. Its name comes from the navigational technique of using multiple reference points to locate an object. the actual operating norms and the ideal norms in four areas are assessed. Quantitative methods such as questionnaires are valuable because of their precision. One particular situation that may require cultural change is a merger or acquisition. sociologists and other behavioral scientists to study organizational culture. TRIANGULATION A study of a rehabilitation centre in a 400-bed hospital incorporated triangulation to improve inclusiveness and accuracy in measuring the organizational culture. workforce diversity and technological innovation.ORGANIZATIONAL CULTURE ACCESSING ORGANIZATIONAL CULTURE Although some organizational scientists argue for assessing organizational culture with quantitative methods. ORGANIZATIONAL CULTURE INVENTORY The OCI focuses on behaviors that help employees fit into the organization and meet the expectations of coworkers. Triangulation has been used by anthropologists. others say qualitative methods yield better results. it measures twelve cultural styles. CHANGING ORGANIZATIONAL CULTURE Changing situation may require changes in the existing culture of an organization. The two underlying dimensions of the OCI are task/people and security/satisfaction. With rapid environmental changes such as globalization. 14 | P a g e . With these two dimensions. comparability and objectivity.saxton culture-gap survey focuses on what actually happens and on the expectations of others in the organization. There are four satisfaction cultural styles and eight securities cultural styles. KILMANN-SAXTON CUKTURE-GAP SURVEY The kilmann. Its two underlying dimensions are technical/human and time.

ORGANIZATIONAL CULTURE EMPOWERMENT OF EMPLOYEE TO EXCEL IN PRODUCT AND SERVICE QUALITY Empowerment unleashes employees¶ creativity Empowerment requires eliminating traditional hierarchical notions of power y y y Involve employees in decision making Remove obstacles to their performance Communicate the value of product and service quality 15 | P a g e .

ensured that employee turnover was way below industry norms. which epitomized fun and fostered a spirit of employee involvement. and the characteristics of work culture at Cisco. This culture ensured that Cisco was on the list of the Fortune magazine's '100 best places to work' for eight consecutive years. The work culture. integrity. Cisco Systems Inc. an element of the Cisco culture. Industry observers were quick to point out that it was the organization culture of Cisco that helped it survive the tough periods of meltdown. in the evolution of the Cisco culture. telecom companies and Internet service providers stopped purchasing telecom equipments from Cisco. Cisco's net sales for fiscal 2004 were $22. employee empowerment. By March 2000. Cisco was founded on a culture based on the principles of customer focus. starting 1998. transparent communication. In 1995. The case looks at Cisco's growth through the years. The case also looks into the role played by the company's CEO. open communication. was responsible for Cisco bouncing back to profit after recording losses during the tech meltdown of 2001. Incorporated in 1984.0 billion. But with the tech meltdown of 2000-01. "If somebody would've told me then that we'd go from 70% growth to minus 30% growth in 45 days. Cisco accounted for 15% of the networking industry's profit and this figure went up to 50% in 2000.5 Though the company recorded losses in 2001. trust. compared with $3.8 percent from the $18. a situation the top management did not expect. and frugality. Continuous Learning. which many feel. the drivers of Cisco culture. recorded $2. 16 | P a g e . market capitalization went up to $ 531 billion while revenues in 2000 were $19 billion. was taken care of even through acquisition and partnerships. I'd have said it was mathematically impossible.6 billion or $0. CASE: Cisco Systems Inc. it bounced back with net profits the next year.2 billion in revenues and a market capitalization of $9 billion in 1995.4 billion or $0. (Cisco). Cisco had a culture based on the principles of customer focus. empowerment.62 per share.9 billion for fiscal 2003. an increase of 16. and giving back to the community. John Chambers.ORGANIZATIONAL CULTURE CISCO CULTURE CASE STUDY ABSTRACT: The case focuses on Cisco's organization culture. President and CEO. Cisco was thus on a free fall. integrity.50 per share for fiscal 2003 (Refer Exhibit I for stock market movement of Cisco between 1990 and 2005). Chambers (Chambers)." said John T. the leader in Internet Protocol (IP)-based networking technologies and networking gear. while net income for fiscal 2004 was $4.

a public website that offered not only company and product information but also technical and customer support to customers. it also introduced customized business applications for its customers' corporate Intranets and automated the ordering process by linking directly to Cisco's internal systems. Jeremy Duke. To deal with the large volume of transactions. US. In 1985. besides broadening Cisco's market reach. The system allowed customers to post queries related to their problems. In 1993.ORGANIZATIONAL CULTURE BACKGROUND NOTE Headquartered at San Jose.000 calls a month. The 'Bug Alert' sent e-mails on software problems within 24 hours of their discovery. There's nobody like them. it built an online customer support system on its site. and employees. 'Networked Strategy' to leverage on its enterprise network to foster interactive relationships with prospective customers. which could send streams of data from one computer to another. In 1996. In the same year. "They are entering into the zone of the great phone companies. Commenting on the growth of Cisco in the late 1990s. which increased to 12. in 1994. Cisco also installed a trigger function called the 'Bug Alert' on its website. Cisco installed an Internet-based system for large multinational corporate customers. Cisco was incorporated on December 10. California. 1984. customers. This was loaded into a box containing microprocessors specially designed for routing. partners. the company started a customer support site from where customers could download software over FTP6 and also upgrade the downloaded software. analyst at market research firm In-Stat7 said. as moneymakers and as builders of infrastructure. it introduced applications for selling products or services on its website. Cisco launched transactional facilities including product configuration and online order placement connected to Cisco's ERP systems. In 1997. Cisco's support centre was receiving around 3. By 1991. Cisco. 17 | P a g e . Cisco launched Cisco Information Online. the company introduced a new Internet initiative. on its site. also provided a database that contained information about potential software problems to help customers and developers. fax. it introduced the dial-in access from desktop computers that enabled customers to place orders without accessing the Internet. In August 1996. The company was founded by a group of computer scientists. Encouraged by the success of its customer support site. and e-mails to the web to save time for employees. who designed software named IOS (Internet Operating System). and trading partners. This was done mainly to transfer paper. In 1995.000 by 1992. suppliers.

If the decision-making team accepted the idea. For recruiting candidates who fit into the culture of Cisco. which helped Cisco employees to be proactive in identifying problem areas. Cisco faced the risk of diluting its culture due to the influences of new recruits who brought in behaviors from past job experiences. Cisco professed a 'worship of customers'. But that requires a level of trust that not all organizations have. "They (the decision-making teams) are empowered to make that decision because we put the authority. "We're focusing on what it will take to communicate the culture and preserve it. a selection criterion was developed which targeted candidates who were frugal. That's another learning experience: Culture is not automatic. he had to discuss the idea with an employee decision-making team and get its assent." mentioned Solvik. and the accountability at the same layer. the responsibility. 'BUILT TO LAST' According to some analysts. Cisco viewed the assessment of customer satisfaction as a continuous process.all hallmarks of the Cisco culture. Cisco's field teams designed the questionnaires that were used to assess customer satisfaction. Senior Vice President and Chief Information Officer (CIO). 18 | P a g e . One of the elements of this assessment was getting regular customer feedback. "This is a culture where the customer comes first. rather than waiting for an annual customer satisfaction survey. without the formality of passing through every layer of management. If the customer has a problem. If a Cisco employee wanted the top management support for an innovative idea. Cisco. and were not obsessed with status . THE WORK CULTURE The organizational structure of Cisco fostered a spirit of employee involvement." said Pete Solvik (Solvik). we drop everything. the company was hiring at a rate which averaged 1000 new employees every month. enthusiastic about the future of the Internet. which was a part of the company's culture right from its inception. Cisco's recruiting team identified candidates whom they felt the company 'should hire' and then designed its hiring processes to attract them to the company. RECRUITMENT AT CISCO Cisco's recruitment practices reflected the company culture.ORGANIZATIONAL CULTURE WHAT DRIVES CISCO'S CULTURE? CUSTOMERS FIRST Cisco's success has been attributed to its relationship with its customers. the top management gave the green signal. In the late 1990s. "Very often it's most efficient to just work with the person involved.

transparent communication.ORGANIZATIONAL CULTURE That it follows a principle of customer focus. Their cultural presence is felt by worldwide leadership in technology by bringing jobs. So CISCO¶s betting big on collaboration that draws manager input from all levels as the main drivers for its strategy to grab new market. It is the culture where customer comes first but in CISCO it¶s also the product that works and matters. Its decentralized system of decision making & futuristic approach are the major gluing factor in retaining employees. Although customer is the top priority in CISCO¶s culture but it gives equal importance to its employees. 19 | P a g e . Here engineer counts as much as culture. Its taking a decentralized form. rather than working on a single leader decision making. communications to countries and government structures. Cisco Systems appeals to businesses and employees in similar ways by offering a standard to be the best provider and staying ahead of the competition. Thus it has a fit culture perspective where customer and competitors comes first. integrity and fragility. Cisco offers a strong customer-responsive organization that blends with cultural needs and service to its employees. employee empowerment. as well as. In conclusion.

when an artificial 20 | P a g e . By thus nurturing the talents of its employees and fostering a climate of innovation. 3M became one of the most innovative companies in the world. ONE HUNDRED YEARS OF SUCCESSFUL INNOVATION It was celebration time at 3M! The company completed 100 years in business in 2002. rationalized purchases. US. and implemented process improvement programs in the company. INVENTING 3M In 1902. McNerney pointed out that the changes brought about in 3M would provide the company a strategic direction in a volatile business environment without harming its organizational culture. For 100 years. He initiated cost cutting measures. He gave a centralized direction to the company from its earlier laissez-faire working style. James McNerney. and the reward system. the culture of knowledge sharing. 3M represented the house of innovation.ORGANIZATIONAL CULTURE 3M CASE STUDY ABSTRACT: The case examines the organizational culture at 3M and the way in which it facilitated innovation at 3M. 3M formula for growth . In 2001. (McNerney) took over as Chairman and CEO of 3M and announced several initiatives to revive the stagnating growth rate of the company.000 products and over thousands of patents for the company. However. In 1904. For many. The new company was in the business of mining corundum. Analysts cautioned that the changes brought about by McNerney might harm the 100-year old culture at 3M that fostered innovation and sustained its growth over the years. five businessmen founded Minnesota Mining and Manufacturing (popularly referred to as 3M) in Two Harbors. The case takes a close look at 3M's environment of innovation. James McNerney Jr. to accelerate growth at 3M.resulted in around 55. The policies and mechanisms adopted by 3M's management to encourage the spirit of innovation in its employees are also discussed.recruit the right people. It also discusses the steps implemented by the new CEO. a mineral best suited for making sandpaper and grinding wheels. The impact of cultural change at 3M on the spirit of innovation is also discussed. Analysts attributed 3M's success to its commitment to innovation. provide them with the right environment to work and let them do their things . They pointed out that 3M gave its employees the freedom to conduct research in areas of their choice even if that research was not related to their official projects.

However. 3M brought out its first breakthrough product. one of the founding members of 3M. To make it easy for recruiters. 3M decided to import garnet5from Spain. they brought a multi-disciplinary approach to their work. In the same year. 3M codified the six traits of innovative people in its recruiting brochure: 21 | P a g e .000 in 3M and had become involved in the day-to-day affairs of the company. According to company sources people who had a broad range of interests were willing to learn and explore new ideas. by 1906. McKnight (McKnight). who joined the company in 1907 as assistant bookkeeper as sales manager. RECRUITING AND RETAINING TALENT 3M recruited people who were creative and had a broad range of interests. 3M hired Paul Carpenter. which had developed artificial abrasive coated emery cloth before 3M. EXPERTS FOSTERING INNOVATION From its early days. It also introduced two breakthrough products. 3M recruited people with diverse backgrounds and expanded its product portfolio. Due to Three-M-ite's success.ORGANIZATIONAL CULTURE abrasive replaced corundum. filed a patent infringement suit against the company. 3M reported sales of $212. Three-M-ite cloth. a successful businessman for funds for the new venture. In order to consolidate its presence in global markets. 898 and in the same year Ober appointed William L. In the 1920s. In addition. approached his friend Lucius Ordway (Ordway). In 1922. 3M entered the English market and reported sales of $68. invented by Francis Okie (Okie) and Dick Drew (Drew) respectively. In the same year. 3M decided to manufacture sandpaper. By 1911. a Chicago based lawyer and expert in patent law. McKnight tried to create an organization that would encourage its employees to take the initiative and come up with new ideas. When 3M realized that the corundum owned by it was a low-grade anorthosite. it decided to shut down the mine and shift to Duluth in 1905. on condition that he won't be involved in the day-to-day affairs of the company. 3M fostered a culture of innovation in its organization. 3M became debt free and announced its first dividend of 6 cents per share in 1916. Ordway agreed to invest $25. 3M established research laboratories. Three-M-ite became the company's first profitable product.000 in the company. waterproof sandpaper and Scotch masking tape. and won the case against Carborundum. and a sales and marketing network across Europe. Edgar Ober (Ober).000 in the first year of its operations. 3M received its first shipment of garnet in 1907 and started producing sandpaper. Ordway had invested around $200. In 1911. McKnight became vice-president. In the same year he became the President of the company. The Carborundum Company.

According to analysts. new businesses were spun off and new management teams were devoted to the spun off units. As these divisions increased in size. these new units were able to grow quickly. In line with this philosophy.technical and management.' resulted in increased diversification at 3M. the established divisions had to develop new products and find new markets to achieve their growth objectives to make up for contributions from the businesses that had become independent. To encourage the spirit of innovation among employees 3M realized it was necessary to reward them appropriately. KNOWLEDGE SHARING In addition to providing an environment that stimulated innovation. created two career ladders . hard work & problem solving attitude are given importance at 3M. REWARDING INNOVATION In addition to recruiting innovative people. This approach allowed even a technical person to get promoted to the vice-president level without taking on managerial and administrative responsibilities. Creativity. This mechanism. 3M also focused on rewarding employees. 3M also took steps to encourage knowledge sharing among its employees. which analysts called 'Renewal. innovation could flourish in 3M because the management encouraged its employees to talk. creating a challenging environment for employees. As a result.ORGANIZATIONAL CULTURE ‡ Creativity ‡ Broad interests ‡ Self motivated ‡ Resourceful ‡ Hard working ‡ Problem solvers CREATING A CHALLENGING ENVIRONMENT Initially 3M was organized into various product divisions. From the 3M case we reach at the conclusion that though McNerney wanted to make the decision system a bit centralized but he preferred employees taking initiatives. When these new businesses were spun off. The dual ladder career path adopted by 3M. not much time was devoted to new product development. It focused on rewarding 22 | P a g e . McKnight noticed that there was a slowdown in innovation. 3M employees never experienced any communication barriers. To increase the pace of new product launches. and encouraging a culture of knowledge sharing. McKnight introduced the philosophy of divide and grow.

(McNerney) of General Electric as its CEO." In December 2000. chief of Business development. It was reported that during 1995-2000. It linked its HR systems to its strategic framework by creating a set of HR strategies that provided. a culture evolved where risk and innovation were viewed as necessary and complementary. They are given full freedom to implement new ideas with no or very less questioning. It basically followed an adaptive culture where employees were the main priority. 3M has developed a culture that effectively supports both quality and innovation.ORGANIZATIONAL CULTURE employees and there was not any communication barrier which encouraged the process of knowledge sharing. training and development plans tied to strategic outcomes.50. So there was a cultural overhaul in the 3M system with the entry of McNerney which resulted in: CULTURE OVERHAUL By the late 1990s. innovative compensation and reward systems. 3M's growth rate started slowing down. According to reports.13 in 1998 and the price-earning ratio (P/E ratio) of the company also declined considerably. 23 | P a g e . Over time. The stock markets responded positively to the appointment of McNerney and 3M's stock price closed at $120. creative organizational structures. Analysts felt that 3M was unable to respond to market conditions. the stock price of 3M dropped from $83.8% and shareholder returns fell far behind Dow and the S&P 500. earnings per share grew at an average of only 8. 3M announced the appointment of James McNerney Jr. 3M recognized that a strategic commitment to innovative products would pay off if it were tied to creating a culture that allowed its employees to be innovative and creative. When an employee at 3M made a mistake or had an idea that didn't work. For the first time. the highest in the decade. Commenting on 3M's performance during the decade. he or she discussed it at a team meeting and the entire team celebrated the learning experience. These are the major gluing factor in 3M which has retained its employees since so long. Through over 90 years of trial and error. Bob Burgstahler (Burgstahler). an outsider was appointed as CEO of 3M. It successfully linked corporate success to the development of new products and a lesser dependence on mature products.00 in 1996 to $71. "We have not produced elite results that correspond to the view that this is an elite organization. There is no communication barrier in the organization. and targeted employee skills. said. 3M has been encouraging a culture of innovation from the very beginning where employees are given freedom to work without any pressure. 3M managed to link strategies to management and employee actions.

´ The annual Performance Appraisal for all of their Employees includes asection on Southwest Culture. They began with one simple notion: If you get your passengers to their destinations when they want to get there. When asked to comment on this. Southwest's no-layoff response to September 11 was a reminder to its employees of the organization's tradition of caring for its people. and make darn sure they have a good time doing it. active or passive. At Southwest. Southwest topped the monthly domestic originating passenger rankings for the first time in May 2003. CULTURE DONE DIFFERENTLY For more than 38 years. Yearend results for 2008 marked Southwest¶s 36th consecutive year of profitability. Today. Southwest is the United States¶ most successful low-fare. In fact. point-to-point carrier. Southwest became a major airline in 1989 when it exceeded the billion-dollar revenue mark. the Southwest Culture is an ingrained part of daily life. Hardly any company make having a ³Fun-Loving Attitude´ a key pillar of their leadership expectations.Houston. active. Rollin King and Herb Kelleher got together and decided to start a different kind of airline. The way they keep their Culture supportive. fun or discouraging. with three Boeing 737 aircraft serving three Texas cities . and fun is by making Southwest¶s Culture everyone¶s responsibility. From an Employee¶s initial interview until the day he or she retires. people will fly your airline. and San Antonio. Southwest operates more than 500 Boeing 737 aircraft between 67 cities. They then celebrate the blessings of the past year on Thanksgiving. And finally. Dallas. high frequency. Those same expectations include ³The Golden Rule´ and possessing a ³Servant¶s Heart. they ask everyone to ³own it. They think of Their Culture in a positive light. the Southwest Culture has thrived. First. on time.´ The Culture Committees are just the beginning of what separates them from the way other companies approach their culture. The longevity has been both their biggest accomplishment and their most significant challenge. at the lowest possible fares. More than 38 years ago.ORGANIZATIONAL CULTURE SOUTHWEST AIRLINES Southwest Airlines was incorporated in Texas and commenced Customer Service on June 18. One of the most significant ³Southwest differences´ in their pursuit to preserve and promote their Culture is the way it is embedded in every aspect of the Company. their Culture encourages celebration. but it hasn¶t been easy. an official 24 | P a g e . 1971. but every company has a culture. America would be a much different place without the courage of their Veterans. they celebrate their Veterans on the month of Nov. whether that culture is supportive or stifling.

To help keep the Culture at the forefront..ORGANIZATIONAL CULTURE explained. news clippings. Employees were expected to care about people and act in ways that affirmed their dignity and worth.. energy and competitiveness. articles and advertisements. rather. Friendliness and familiarity also characterized the company's relationships with its customers. Kelleher knew the names of most employees and insisted that they referred to him as Herb or Herbie. Kelleher's personality had a strong influence on the culture of Southwest. "Its part of our culture. The Employees roll up their sleeves to help out their area Ronald McDonald Houses at Thanksgiving. BUILDING RELATIONSHIPS Since its inception. and are left to choose their own seats on the plane. Both groups put on low-cost Employee events throughout the year. Southwest's culture had three themes: love. Kelleher's personality charmed workers and they reciprocated with loyalty and dedication. Southwest attempted to promote a close-knit. fun and efficiency. ARTIFACTS The artifacts which are the symbols of culture in the physical and social work environment can be seen in the way the Southwest Company treats its employees. they have two groups: Local Culture Committees and the Corporate Culture Committee. supportive and enduring family-like culture The Company initiated various measures to foster intimacy and informality among employees. Southwest encouraged its people to conduct business in a loving manner.. We've always said we'll do whatever we can to take care of our people."1 Southwest's organizational culture was shaped by Kelleher's leadership. Kelleher treated all the employees as a "lovely and loving family".. they are assigned to one of three "boarding groups" depending on their check-in time (earlier check-ins get to board earlier). Colleen Barrett who is the former President of southwest airlines sent cards to all employees on their birthdays. Customers are not assigned seats. the company hung photographs of its employees taking part at company events. So that's what we've tried to do. which helps the airline to board passengers faster 25 | P a g e . which epitomized his spontaneity. The CEO joins with the Employees to wish Happy Thanksgiving. letters. Instead of decorating the wall of its headquarters with paintings.

That's a pretty good reason to stick around.8 billion with an additional $575million in untapped credit lines. Not furloughing people breeds loyalty. "We've never lost our jobs. "Nothing kills your company's culture like layoffs. but I always thought that was shortsighted. employees. Core Values LUV Code word for treating individuals. He said. Halloween parties THRIVING UNDER PRESSURE Post-September11. Frequent company-sponsored parties and celebrations. it was still worth more than all the others big airlines combined. The company left no stone unturned to boost employee loyalty and morale. 2001. Kelleher had explained his philosophy regarding layoffs in an interview to Fortune magazine.".came in to negotiate one time. and in good times they're thinking." We could have furloughed at various times and been more profitable. and he said.. So in bad times you take care of them. Appeared on banners and posters at company facilities Fun Entertaining behavior of employees in performing their jobs.. respect and caring loving attitude. It breeds a sense of security. You want to show your people that you value them and you're not going to hurt them just to get a little more money in the short term. 26 | P a g e . Its balance sheet looked strong with a 43% debt-to-equity ratio and it had a cash of $1.. customers Dignity. Southwest was the only airline to remain profitable in every quarter since the September 11 attack. Even before the September 11 crisis hit.. One of the union leaders«. (Refer Exhibit VIII for financial position of Southwest. It's been a huge strength of ours. It breeds a sense of trust. when most airlines in the US went in for massive layoffs. and that is unprecedented in the airline industry. Southwest avoided laying off any employee. "We know we don't need to talk with you about job security. chili cook-offs.ORGANIZATIONAL CULTURE VALUES Company Values . Nobody has ever been furloughed [at Southwest]. perhaps. It's certainly helped us negotiate our union contracts. Charity benefit games.) Although its stock price dropped 25% since September 11. The ongoing pranks and jokes.

friendliness and familiarity this resulted in the thinking of the employees that ³they value us´ and thus we need to stick around. Their culture is all about care. This is the main gluing factor of the organizations culture. 27 | P a g e .ORGANIZATIONAL CULTURE South West Airlines has follows a fun loving attitude.

norms. 3M has built its organizational culture which holds its employees together in line with the vision and mission of the organizationsouthwest airlines has built an organization of repute . think and act on a dayTo-day basis. The strength of the culture will depend on sharedness and intensity. not all may do so to the same degree.ORGANIZATIONAL CULTURE CONCLUSION Organizational culture is a pattern of basic assumptions that are taught to the personnel as the correct way to perceive. Some of the important characteristics of organizational culture are observed behavioral regularities. In some cases organizations find that they must change their culture in order to remain competitive and even survive in their environment.an enterprise that stands apart which even during the last economic downturn was unshaken. rules. Some organizations have strong cultures and others have weak cultures. While CISCO has given its culture an innovative and futuristic approach with customer as the top priority. 28 | P a g e . values. While everyone in the organization will share the organization's culture. we had analyzed the value system of the organization like CISCO. philosophy and so on. With reference to the cases in this project. but also a number of subcultures. There can be a dominant culture. 3M and SOUTH WEST AIRLINES.

ORGANIZATIONAL CULTURE BIBLOGRAPHY: www.Aswathappa 29 | P a g e .org Organizational Behavior by Nelson Quick Organizational Behavior by K.icmrindia.

Sign up to vote on this title
UsefulNot useful