Service Management and

Marketing
Services and organizational culture
Gábor Réthi, PhD
Definition of organizational culture
•„The way we do things around here”
(Deal and Kennedy, 1982)
•„The glue that bonds the company together”
•„A pattern of basic assumptions that the group has
learned as it solved its problems of external adaptation
and integration, that has worked well enough to be
considered valid, and therefore, to be taught to new
members as the correct way to perceive, think, and feel in
relation to those problems.” (Schein, 1985)
Daft Iceberg
model
McKinsey 7S Specific objectives and action plans

Regulate the distribution of

tasks and responsibilities
Management style
and behaviour

Management and monitoring

Staff qualifications
tools

Process control
Motivational potential

The company's total unique strengths

McKinsey 7S
(Starbucks)
McKinsey model

Hard elements Soft elements

• You can describe it by models
and numbers
• These do not make the
organizations unique
• Buyable
• There is in people’s mind
• Cannot be copied
• Hard to change
Types of organizational cultures (Handy)

•Power
•Role
•Task
•Person
Power culture
•SMEs
•Spider-web design
•The founder or chief is plenipotentiary
•Personal power
•Proud and strong
•Respond quickly to changes
•Inhibit organizational growth
Role culture
•Bureaucratic
•Logic and rationality
•Central role of functional units
•The role is more important than the person
•Power based on position
•Operating well in stable environment
•Rigid and slow to respond
Task culture
•Project-oriented
•Web design (matrix)
•Conflict with the power in the net lattices
•Skills-based
•Team culutre
•Flexible
•Struggle for resources
Person culture
•Rare appearance
•Personal goals are more important than the
organizational ones
•Selection is based on expertise and reputation
•Power and control mechanisms are based on agreement
•Loose organizational framework
Culture-based Leadership Model of
Services
Culture-based Leadership Model of
Services
•Indirect control: employees have to work in a much more open
system than members in production companies
•Psychological contract: serves as a guideline for relying on the
skills and maturity of the members
•Trust: managerial credibility (honesty + foresight + capability of
inspiration + expertise = credibility)
•Holographic view (Moments of the Truth = mind-like operation)
•Harmony of the espoused-values and values in-use (Shared
values must be transparent and commonly known and accepted.)
Thank you for the kind attention!