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Organizational Culture

Chapter 13

IBUS 681, Dr. Yang

Learning Objectives
Define organizational culture and know why it is important Distinguish among organizational, national, and global culture and understand the relationships among them Evaluate the culture-free approach to understanding organizational culture
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Learning Objectives (cont.)


Identify levels of organizational culture Know what organizational culture does Discuss the cultural dimensions and typology approaches to understanding organizational culture Understand how organizational culture can be managed
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Organizational Culture
A pattern of basic assumptions - invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal 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 (Schien, 1985).
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National and Global Culture


Relationship between national and corporate culture is complex:
Logic of industrialization" may affect all organizations the same way National culture and other elements in an organization's environment may determine internal organizational culture Globalization also affects organizational culture
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Henry Ford, founder of the Ford Motor Company said:


Getting together is beginning Keeping together is progress Working together is success

IBUS 681, Dr. Yang

National and Global Culture


One can not understand whats going on inside an organizational culture without understanding what exists outside the boundary.
National culture provides basic assumptions that legitimize and guide organizational behavior. Industrialization promotes changes in national culture. Globalization increases awareness of successful practices elsewhere. Modern communication enhances connections among manufacturers, merchants, financiers, consumers, etc. globally. MNCs seek consistency and shape organizational culture on a global basis.
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Culture-Free Approach
It argues that technology, policies, rules, organizational structure, and other variables that contribute to efficiency and effectiveness make national culture irrelevant for management.
McDonalds fast food service World Disney IKEA
Disney Paris Ears
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Understanding Organizational Culture


Organizations are culture free in some respects, but culture bound in many others (Trice & Beyer, 1993). Global, national, and organizational elements interact to influence organizational culture and behavior.
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McDonald's Restaurants
Moscow or some others
Types of the restaurant Food adaptation Service adaptation Perceptions of jobs Workplace culture Employee commitment

U.S.
Fast food life style Convenience Temporary jobs High turnover rate Standard food items

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Levels of Organizational Culture


Artifacts Espoused Values Actual Values Basic Underlying Assumptions
Subcultures

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Artifacts

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Microsofts Mission:
To enable people and businesses throughout the world to realize their full potentials

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Great People with Great Values


Delivering on our mission requires great people who are bright, creative, and energetic, and who share the following values:
Integrity and honesty. Passion for customers, partners, and technology. Open and respectful with others and dedicated to making them better. Willingness to take on big challenges and see them through. Self-critical, questioning, and committed to personal excellence and self-improvement. Accountable for commitments, results, and quality to customers, shareholders, partners, and employees.
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National Vs. Organizational Culture


National culture
Broader More complex Influence org. culture Primary and secondary socialization

Organizational culture
Narrower Manageable Secondary socialization Subcultures

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What Organizational Culture Does


FUNCTIONS Provides an external identity Creates a sense of commitment Acts as source of high reliability Defines an interpretive scheme Acts as a social control mechanism DYSFUNCTIONS Can create barriers to change Can create conflict within the organization Subcultures can change at different rates than other units

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Some Underlying Dimensions of Organizational Culture


Dimension
1. The organizations relationship to its environment 2. The nature of human activity 3. The nature of reality and truth

Questions to be answered
Does the organization perceive itself to be dominant, submissive, harmonizing, searching out a niche? Is it the correct way for humans to behave to be dominant/proactive, harmonizing, or passive/fatalistic? How do we define what is true and what is not true; and how is truth ultimately determined both in the physical and social world?
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Some Underlying Dimensions of Organizational Culture (cont.)


Dimension
4. The nature of time

Questions to be answered
What is our basic orientation in terms of past, present, and future, and what kinds of time units are most relevant for the conduct of daily affairs? Are humans basically good, neutral, or evil, and is human nature perfectible or fixed?

5. The nature of human nature

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Some Underlying Dimensions of Organizational Culture (cont.)


Dimension Questions to be answered
6. The nature of human What is the correct way for people to relate to each other, to distribute power and affection? Is relationships
life competitive or cooperative? Is the best way to organize society on the basis of individualism or groupism? Is the best authority system autocratic/paternalistic or collegial/participative?

7. Homogeneity versus Is the group best off if it is highly diverse or if it is highly homogeneous, and should individuals in a diversity
group be encouraged to innovate or conform?

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Trompenaars Four Corporate Cultures


Family Culture Eiffel Tower Culture Guided Missile Culture Incubator Culture

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Characteristics of Trompenaars Four Types of Corporate Culture


Variables
Relationship between employees Attitudes toward authority Ways of thinking and learning Attitudes towards people Ways of changing Ways of motivating and rewarding

Family
Diffuse relationships to organic whole to which one is bonded Status is ascribed to parent figures who are close and powerful Intuitive, holistic, lateral, and errorcorrecting Family members

Eiffel Tower
Specific role in mechanical system of required interactions Status is ascribed to superior roles, which are distant yet powerful Logical, analytical, vertical, and rationally efficient Human resources

Guided Missile
Specific tasks in cybernetic system targeted upon shared objectives Status is achieved by project group members who contribute to targeted goals Problems centered, professional, practical, cross-disciplinary Specialists and experts

Incubator
Diffuse, spontaneous relationships growing out of shared creative process Status is achieved by individuals exemplifying creativity and growth Process oriented, creative, an hoc, inspirational Co-creators

Father changes course Intrinsic satisfaction in being loved and respected Management by subjectives Turn other cheeks, save others faces, do not lose power game

Change rules and procedures Promote to greater position, larger role Management by job description Criticism is accusation of irrationalism unless there are procedures to arbitrate conflict

Shift aim as target moves Pay or credit for performance and problems solved Management by objectives Constructive taskrelated only, then admit error fast and correct

Improvise and attune Participating in the process of creating new realities Management by enthusiasm Must improve creative idea, not negate it

Management style
Criticism and conflict resolution

Managing and Changing Organizational Culture


Leadership and organizational culture Elements of culture leaders can change
Employee selection criteria Socialization of new members Meaning of work Artifacts/surface manifestations of culture
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Convergence or Divergence?
Industrialization Emphasis on standardization Organizational strategies for managing culture globally Emphasis on consistency across borders
MNCs Global institutions

Use of organizational culture as a competitive tool Impact of diverse national cultures on organizational culture Benefits in specific and culturally sensitive ways
Seniority Job security Group versus individual
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Implications for Managers


For managerial effectiveness, it is helpful to analyze organizational cultures in order to coordinate activities or change them; Understand what levels of culture can be influenced and how; Know how national culture and organizational culture can interact to influence management philosophy and employee behaviors. Person-culture fit for individual career success
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