Organization Culture

© 2005 Prentice Hall Inc. All rights reserved. 16–1

 What
What Is
Is Organizational
Organizational Culture?
Culture?

Organizational Culture
A system of shared meaning held by members that
distinguishes the organization from other
organizations.
Characteristics:
Characteristics:
1.1. Individual
IndividualInitiative
Initiative
2.2. Risk
RiskTolerance
Tolerance
3.3. Direction
Direction
4.4. Integration
Integration
5.5. Management
ManagementSupport
Support
6.6. Control
Control
7.7. Identity
Identity
© 2005 Prentice Hall Inc. All rights reserved. 16–2
 Conti…
Conti…
 Reward System
 Conflict Tolerance

 Levels of Culture:
 National Culture
 Business Culture
 Occupational Culture
 Organization Culture

© 2005 Prentice Hall Inc. All rights reserved. 16–3

 Do
Do Organizations
Organizations Have
Have Uniform
Uniform Cultures?
Cultures?
 Authoritarian and Participative Culture:
In the Authoritarian Culture, Power is
concentrated on the leader and obedience to orders
and discipline are stressed.
While Participative Culture is premised
on the notion that people are more committed to
the decisions that are participatively made than
those which are imposed on them.

© 2005 Prentice Hall Inc. All rights reserved. 16–4

 Conti….
Conti….
 Dominant and Sub-cultures:
Dominant Cultures refers referred to as
organizational culture, reflects core values that are
shared by the majority of the employees. In effect,
this is the distinctive personality of the
organization.
while Sub-Cultures are found in
departments, divisions, and geographical areas,
and reflect the common problems or experiences
of employees who reside in these areas.

© 2005 Prentice Hall Inc. All rights reserved. 16–5

 Conti…
Conti…
 Strong and Weak Culture:
In the Strong Culture, the core values of the
organization are widely shared and eagerly
embraced by a large number of employees who
are deeply committed to them.
Weak Culture is characterized by the presence
of several subcultures, sharing of few values, and
behavioral norms by employees, and existence of
few sacred traditions.

© 2005 Prentice Hall Inc. All rights reserved. 16–6

 What
What Do
Do Cultures
Cultures Do?
Do?

Culture’s
Culture’sFunctions:
Functions:
1.1. Defines
Definesthe
theboundary
boundarybetween
betweenone
oneorganization
organization
and
andothers.
others.
2.2. Conveys
Conveysaasense
senseof
ofidentity
identityfor
forits
itsmembers.
members.
3.3. Facilitates
Facilitatesthe
thegeneration
generationofofcommitment
commitmentto
to
something
somethinglarger
largerthan
thanself-interest.
self-interest.
4.4. Enhances
Enhancesthe
thestability
stabilityof
ofthe
thesocial
socialsystem.
system.
5.5. Serves
Servesas asaasense-making
sense-makingand
andcontrol
controlmechanism
mechanism
for
forfitting
fittingemployees
employeesininthe
theorganization.
organization.

© 2005 Prentice Hall Inc. All rights reserved. 16–7

 What
What Do
Do Cultures
Cultures Do?
Do?

Culture
Cultureas
asaaLiability:
Liability:
1.1. Barrier
Barrierto
tochange.
change.
2.2. Barrier
Barrierto
todiversity
diversity
3.3. Barrier
Barrierto
toacquisitions
acquisitionsand
andmergers
mergers

© 2005 Prentice Hall Inc. All rights reserved. 16–8

 Creating
Creating and
and Sustaining
Sustaining Culture
Culture

How is culture created?

 External adaptation and Survival: It involves
addressing the following issues:-
• Mission and Strategy
• Goals
• Means
• Measurement

© 2005 Prentice Hall Inc. All rights reserved. 16–9

 Conti..
Conti..
 Internal Integration: Involves
• Language
• Group and Team Boundaries
• Reward and Punishment.
 Culture Formation Around Critical Incidents.
 Identification with Leaders
 Property Rights
 Organization Structure
 Organization Ethics
 Characteristics of People with in the
Organization
© 2005 Prentice Hall Inc. All rights reserved. 16–10
 Sustaining
Sustaining the
the Culture:
Culture: Keeping
Keeping Culture
Culture Alive
Alive
 Selection
– Concern with how well the candidates will fit into
the organization.
– Provides information to candidates about the
organization.
 Top Management
– Senior executives help establish behavioral norms
that are adopted by the organization.
 Socialization
– The process that helps new employees adapt to
the organization’s culture.
© 2005 Prentice Hall Inc. All rights reserved. 16–11
 Stages
Stages in
in the
the Socialization
Socialization Process
Process

Prearrival Stage
The period of learning in the socialization process
that occurs before a new employee joins the
organization.
Encounter Stage
The stage in the socialization process in which a
new employee sees what the organization is really
like
. and confronts the possibility that expectations
and reality may diverge.

© 2005 Prentice Hall Inc. All rights reserved. 16–12

 Conti…
Conti…
 Metamorphosis Stage
The stage in the socialization process in which a
new employee changes and adjusts to the work,
work group, and organization.
 Culturally Consistent Rewards

© 2005 Prentice Hall Inc. All rights reserved. 16–13

 AA Socialization
Socialization Model
Model

© 2005 Prentice Hall Inc. All rights reserved. 16–14

 How
How Employees
Employees Learn
Learn Culture
Culture

•• Stories
Stories
•• Rituals
Rituals
•• Structures
Structuresand
and
Material
MaterialSymbols
Symbols
•• Language
Language

© 2005 Prentice Hall Inc. All rights reserved. 16–15

 Creating
Creating An
An Ethical
Ethical Organizational
Organizational Culture
Culture
 Characteristics of Organizations that Develop High
Ethical Standards
– High tolerance for risk
– Low to moderate in aggressiveness
– Focus on means as well as outcomes
 Managerial Practices Promoting an Ethical Culture
– Being a visible role model.
– Communicating ethical expectations.
– Providing ethical training.
– Rewarding ethical acts and punishing unethical ones.
© 2005 Prentice Hall Inc. All rights reserved. 16–16
 Creating
Creating aa Positive
Positive Organizational
Organizational Culture 
Culture 
A positive culture is one that emphasizes the
following:
 Building on Employee Strengths
 Rewarding More Than Punishing
 Emphasizing Vitality and Growth of the Employee

© 2005 Prentice Hall Inc. All rights reserved. 16–17