Constructing the

Entrepreneurial
Culture

Chapter 4
Entrepreneurial Transformation

LEADERSHI
P
CULTURE STRATEGIE
S
STRUCTURE
S
 Culture

An organisation’s basic beliefs and

assumptions about what it is
about, how its members behave,
and how it defines itself in relation
to the external environment

Cornwall &
Perlman
 Hofstede’s Dimensions of Culture
• Individualism v collectivism – the degree to
which people prefer to act as individuals
rather than as groups
• Power distance – the degree of inequality
accepted by the community
• Uncertainty avoidance – the degree to which
people avoid ambiguity/uncertainty & prefer
structure
• Masculine vs feminine – quality of life issues
like individual achievement & assertiveness vs
relationships & concern for others
 National Culture
Low High
South America,
USA, UK, France,
Saudi Arabia, INDIVIDUALISM
Australia, Canada
Pakistan
USA, UK, South America,
Germany, POWER DISTANCE France, Malaysia,
Scandinavia Saudi Arabia

USA, UK, Austria,

North Europe MASCULINITY
Japan, Germany
 National Culture
Low High
South America,
USA,
USA UK,
UK France,
Saudi Arabia, INDIVIDUALISM
Australia, Canada
Pakistan
USA,
USA UK,
UK South America,
Germany, POWER DISTANCE France, Malaysia,
Scandinavia Saudi Arabia

USA,
USA UK,
UK Austria,
North Europe MASCULINITY
Japan, Germany
 Cultural Web

POWER STORIES

CULTURAL
PARADIGM
ROUTINES SYMBOLS

CONTROL
RITUALS
SYSTEMS
 Cultures & Learning
Enhances learning Inhibits learning
Balances interests of Tasks more important
stakeholders than people
Focuses on people Focus on systems
Empowers people & Allows change only
makes them believe when necessary
Makes time for Preoccupied with short
learning term
Takes holistic Compartmentalises
approach to problem problem solving
solving
Encourages open Restricts information
communication & communication
Believes in teamwork Believes in individual
competition
Has approachable Has controlling leaders
leaders
Balance between Low uncertainty
collectivism & avoidance
Close relationships with
individualism customers
Opportunistic
Creative &
Close relationships with suppliers innovative

Belonging, Measured risk-

Close relationships with staff ownership taking
Celebrate success
Commitment Celebrate Self-confident but
Achievement
success realistic
Building networks Measured risk-
Can-do attitude Empowered, Can-do attitude
taking
can-do attitude Change is normal
Belief in team
People are important work Creativity & Work is fun
Strong relationships
innovation
Achievement Belief in team Strong relationships Strong relationships Continual learning
work Egalitarian
Can-do attitude Empowered, can-do Using & sharing
People are attitude information & knowledge
Commitment important Doing the ‘right Sharing information &
thing’ Time for learning & knowledge
Building networks innovation
Celebrate success
Personal
responsibility Open communication Close relationships with staff
Close relationships with staff
Belonging, Close relationships with suppliers
Close relationships with suppliers ownership

Balance between Close relationships with Close relationships with Low power
masculinity & customers customers
distance
femininity
Dimensions of Entrepreneurial Culture
LOW HIGH

INDIVIDUALISM

POWER DISTANCE

UNCERTAINTY AVOIDANCE

MASCULINITY

Organization National/Individual
entrepreneurial entrepreneurial
culture culture
 Influences on Culture
Organizational processes Cognitive processes
• Leadership styles • Ethics, beliefs, assumptions
• Structures & attitudes
• Controls & rewards • Norms & rules of conduct
• Empowerment
• Routines, rituals, rites & taboos
• Stories, symbols & myths

CULTURE
Behaviors
•How things actually get done
- rational v politicking,
- rule following v bending
• Vocabulary – job titles, slogans, metaphors, signals, gossip
 Ways to Destroy a Rich Culture

1. Manage the bottom line

2. Make a plan for every action
3. Move managers around
4. Always be objective (treat people as
objects)
5. Do everything in five easy steps
 Culture & leadership style
• Theory X - assumes employees dislike
work
• Theory Y - assumes employees can like
work & can be motivated & then trusted
to exercise discretion within framework
of rules
• Theory Z – assumes consensus & trust
can be established through
participative, team-based decision-
making