Human Resource Management

Lesson 13 – Organizational Culture

Chapter 15
BITS Pilani Dr. Annapoorna Gopal
Pilani | Dubai | Goa | Hyderabad
Learning Objectives

• Nature of organisational culture

• Different cultural dimensions

• Ways of creating and sustaining culture

• Cultural artifacts

• Effects of culture

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Nature of Culture

• Two terms are key to culture: History and shared phenomenon

• Organisational members tend to internalise cultural practices and like to

Personnel/Human Resource Management, p. 226

indoctrinate newcomers into such moves

Source: Herbert G. Heneman III, et. al.,

• Besides institutionalisation, deification or glorification is another process
that tends to occur in strongly developed organisational cultures

• Organisational members begin to feel a strong bond with it that

transcends material returns given by the organisation, and they begin to
identify with it
Recruitment Process

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Vision and Mission

• Vision: Seeks the answers to:

– What does the organisation stand for?

– Where does it go from here?

– What values do the organisation commit itself to?

• Mission: Incorporates four elements:

– Customer needs, or what is being satisfied

– Customer group, or who is being satisfied

– The company’s activities, technologies, and competencies, or how the firm goes about creating

– and delivering value to customers and satisfying their needs.

– The company’s concern for survival, its philosophy, its self-concept and its concern for public
image

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Values and Strategies

• Values
– Represent specific behaviours that stem from vision and mission
– Values shape and guide organisational culture
• Strategies
– Strategies are formulated for the business as a whole and for each unit of the
organisation
– If the unit level strategy is to operate in a niche market, a culture that
encourages innovation evolves
– The HR management system plays a critical role in keeping the value
proposition well tuned and relevant for each generation of employees by
embedding vision and mission into daily work life

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Three Levels of Culture

Internal and External Recruitments: Advantages and Disadvantages

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Cultural Dimensions - 1

• Mechanistic and Organic Cultures

– Exhibits the values of bureaucracy and feudalism

• Authoritarian and Participative Cultures

– Power is concentrated on the boss and obedience to orders and
discipline are stressed

• Dominant and Sub-cultures

– The values, beliefs and norms evolved by the large organisations are
binding and shared by all employees

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Cultural Dimensions - 2

• Strong, Weak and Unhealthy Cultures

– In a strong culture, the core values of the organisation are widely shared and
eagerly embraced by all members and are deeply committed to them

– A weak culture is characterised by the presence of several sub-cultures,

sharing of few values and compliance norms, and existence of few sacred
traditions

– unhealthy trait is a politicised internal environment that allows influential

managers to operate autonomous ‘fiefdoms’ and resist needed change

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How is culture created?

• Basically, an organisational culture forms in response to two

major challenges:
– External adaptation and Survival
• Mission and Strategy
• Goals
• Means
• Measurement
– Internal integration
• Language and concepts
• Group and team boundaries
• Power and statuses
• Reward and punishment

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Where does organizational culture come from?

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 Culture Artefacts

• Stories
– Stories about the CEO
– Stories about getting fired
– Stories about how the company deals with employees who have to relocate
– Stories about how the company deals with crisis situations
– Stories whether lower level employees can rise to the top
• Rituals
• Ceremonies
• Languages
• Structures and Symbols
• Statement of Principles

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Strategies for sustaining culture

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Effects of Culture

• Cultural effects may be both functional as well as dysfunctional

• Another problem from well-knit culture relates to the management of diversity
• Culture acts as a barrier to mergers and acquisitions
• Culture tends to lead to groupthink
– There is an illusion that the group is invulnerable and cannot make major errors in judgment
– Information that is contradictory to the dominant group view tends to be ignored, discounted
or minimized
– Group members are pressured to conform to the majority view, although the pressure might be
relatively subtle
– The pressure to conform discourages minority viewpoint from being brought before the group
– There is an illusion of morality.
• Benefits of culture
– Effective control
– Promotion of innovation
– Strategy formulation and innovation

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Changing organizational culture - 1

• Culture of an organisation needs to be changed, particularly when it is

weak or unhealthy and impedes any strategy implementation
• It may be stated that those advocating culture generally focus on more
superficial elements, such as norms and artifacts
• Deeper elements of organisational culture represent assumptions about
organisational life which members do not question and have difficulty in
envisioning anything else
• Age-old practices of doing business seldom die
• Finally, any change in culture demands change in the configuration of
organisational members, the property rights system, and organisational
structure

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Changing organizational culture - 2

• Notwithstanding the difficulties, change in culture becomes

necessary in the following circumstances:
– Culture of an organisation does not fit a changing environment
– If the industry is extremely competitive and changes rapidly
– If the company is mediocre or worse
– If the organisation is about to become a very large one
– If the company is smaller and growing rapidly

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Changing organizational culture - 3

• Guidelines for Changing

– Formulate a clear strategic vision
– Display top management commitment
– Model culture change at the highest levels
– Restructure the organisation to support the new culture
– Select and socialize newcomers and terminate deviants
– Develop ethical and legal sensitivity
– The following deserve serious consideration
• Don’t oversimplify culture
• Don’t label culture as an outcome of an organisation’s vision, mission and values
• Don’t assume that a single individual/leader can manipulate culture
• There is no such thing as a “correct” culture
• Don’t assume that all the aspects of an organisation culture are important

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