What is Organizational Culture?

 Shared values, beliefs, norms

influence the way employees think, feel, and
behave towards each other and towards
people outside the organization

 Pattern of shared basic assumptions

Building Blocks of
Organizational Culture
 Characteristics of people within the
organization
 Organizational ethics
 Employment relationship
 Organizational structure
 National culture
What are Organizational Values?
 Guiding principles
behaviors, events, situations, and outcomes
are desirable or undesirable
 Types
Terminal- A desired end state or outcome
that people seek to achieve
Instrumental- A desired mode or type of
behavior.
Terminal and Instrumental Values
Terminal Instrumental
 Working hard
 Quality
 Respecting traditions
 Responsibility
 Respecting authority
 Innovativeness
 Excellence
 Being conservative
 Economy
 Being frugal
 Morality  Being creative
 Profitability  Being honest
Terminal and
Instrumental Values

Organizational Values

Terminal Instrumental
Values Values

Specific norms,
rules, and SOPs
 Levels of Culture
Edgar Schein, often referred to as the godfather of organizational
culture, developed a model that illuminates three different levels of
culture.

 
 Level 1-The Artefacts
The visible manifestations of culture for example dress code and
décor.
Level 2-Espoused Values
How an organisation explains its culture, for example official policy
and accepted beliefs. Discover through ‘why’ questions.
Level 3- Shared Tacit Assumptions
The hidden assumptions, values and beliefs. The understood,
traditional and unofficial ways of being, doing and feeling.

Schein’s three levels of organizational culture are sometimes referred to as the

“onion model”, meaning that cultural change in an organization starts with the
understanding that, similar to an onion, several layers must be peeled back and
examined.
Some layers are easier to adapt and change such as the outer layer or artifacts
level, and other layers are more challenging to adapt and change such as the core
layer or assumptions level (Organizational Culture Model - Schein).
 
Ways of Transmitting Organizational
Culture

Formal socialization
practices

Ceremonial
Employees The
Rites
learn organizational
and
through: language
Ceremonies

Signs, symbols, stories

Ceremonial Rites
 Rites of passage

 Rites of integration

 Rites of enhancement
Where an Organization’s Culture Comes
From

Characteristics of People
Within Organization

Nature of
Organizational Organizational
Employment
Ethics Culture
Relationship

Design of
Organizational Structure
Sources of Organizational Ethics

Organizational Ethics

Societal Professional Individual

Ethics Ethics Ethics
 Stories Rituals

How Employees
Learn Culture/
How it is “reinforced”

Material
Language
Symbols

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Adaptive versus Inert Cultures

Adaptive Cultures Inert Cultures

 Values and norms  Values and norms fail
help organization to motivate or inspire
build momentum, employees
grow, and change to  Stagnation
achieve goals  Minimal investment in
 Investment in employees
employees  Little incentive for
 Merit rewards improvement
Do Organizations Have Uniform
Cultures

Dominant Subcultures
Culture
Core
Values

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Creating an Ethical Culture
 Establish rules and norms that outline
organization’s ethical position

 Demonstrate commitment to following

rules

 Reduce incentives for unethical behavior

Creating an Ethical Culture

 Develop fair and equitable HR procedures

 Provide access to upper-level managers

 Encourage employees to voice concerns

 Create a strong board of directors

Why Does Unethical Behavior Occur?

 Lapses in Individual Ethics

 Ruthless Pursuit of Self-Interest

 Outside Pressure