ORGANIZATIONAL CULTURE AND

ENVIRONMENT
Week 3

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 CONTRAST THE ACTIONS OF MANAGERS
ACCORDING TO THE OMNIPOTENT AND SYMBOLIC
VIEWS

• How much difference does a manager make in how an organization

performs?

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1. The Omnipotent View
• The dominant view in management theory and society in general is
that managers are directly responsible for an organization’s success or
failure.
• Differences in an organization’s performance are assumed to be due
to decisions and actions of its managers.
• Good managers anticipate change, exploit opportunities, correct poor
performance, and lead their organizations.
• When profits are up, managers take the credit and are rewarded with
bonuses, stock options, and the like. When profits are down, to
managers are often fired in the belief that “new blood” will bring
improved results.

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2. The Symbolic View
• The symbolic view says that a manager’s ability to affect performance
outcomes is influenced and constrained by external factors. According
to this view, it’s unreasonable to expect managers to significantly
affect an organization’s performance.
• Instead, performance is influenced by factors over which managers
have little control such as the economy, customers, governmental
policies, competitors’ actions, industry conditions, and decisions
made by previous managers.

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• In reality, managers are neither all-powerful nor helpless. But their
decisions and actions are constrained.
• External constraints come from the organization’s environment and
internal constraints come from the organization’s culture.

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 ORGANIZATIONAL CULTURE

• A system of shared meanings and common beliefs held by organizational

members that determines, in a large degree, how they act towards each
other.
• “The way we do things around here.”
• Values, symbols, rituals, myths, and practices
• Implications:
• Culture is a perception.
• Culture is shared.
• Culture is descriptive.

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Dimensions of Organizational Culture

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STRONG VERSUS WEAK CULTURES

• Strong Cultures
• Are cultures in which key values are deeply and widely held.
• Have a strong influence on organizational members.
• Factors Influencing the Strength of Culture
• Size of the organization
• Age of the organization
• Rate of employee turnover
• Strength of the original culture
• Clarity of cultural values and beliefs

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BENEFITS OF A STRONG CULTURE
• Creates a stronger employee commitment to the organization.
• Aids in the recruitment and socialization of new employees.
• Fosters higher organizational performance by instilling and
promoting employee initiative.

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Strong Versus Weak Organizational Cultures

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WHERE CULTURE COMES FROM AND HOW IT CONTINUES

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 Founder values
• Founder values become part of the corporate culture to the degree to
which they help the company be successful
• A company’s culture, particularly during its early years, is inevitably
tied to the personality, background, and values of its founder or
founders, as well as their vision for the future of the organization.
• When entrepreneurs establish their own businesses, the way they
want to do business determines the organization’s rules, the structure
set up in the company, and the people they hire to work with them.
 Selection
• Just as candidates are looking for places where they will fit in, companies
are also looking for people who will fit into their current corporate culture.
• Many companies are hiring people for fit with their culture, as opposed to
fit with a certain job.
• For example, Southwest Airlines prides itself for hiring employees based
on personality and attitude rather than specific job-related skills, which
they learn after they are hired. Companies use different techniques to
weed out candidates who do not fit with corporate values.
• For example, Google relies on multiple interviews with future peers. By
introducing the candidate to several future coworkers and learning what
these coworkers think of the candidate, it becomes easier to assess the
level of fit.
 Top Management/Leaders
• Top Management are instrumental in creating and changing an
organization’s culture.
• There is a direct correspondence between the leader’s style and an
organization’s culture.
• For example, when leaders motivate employees through inspiration,
corporate culture tends to be more supportive and people-oriented.
When leaders motivate by making rewards contingent on performance,
the corporate culture tended to be more performance-oriented and
competitive (Sarros, et. al., 2002).
• In these and many other ways, what leaders do directly influences the
cultures of their organizations
 Socialization
• Socialization is the process through which people are taught to be
proficient members of a society.
• It describes the ways that people come to understand societal norms
and expectations, to accept society’s beliefs, and to be aware of societal
values.
• Socialization helps people learn to function successfully in their social
worlds.
• In order to maintain that culture, potential and newly hired employees
will go through a socialization process.
• Socialization is a process through which new employees learn the
attitudes, skills and behaviors required to function effectively in their
new work environment.
 HOW EMPLOYEES LEARN CULTURE
• Stories
• Narratives of significant events or actions of people that
convey the spirit of the organization
• Rituals
• Repetitive sequences of activities that express and
reinforce the values of the organization
• Material Symbols
• Physical assets distinguishing the organization
• Language
• Short terms, phrases, and word meanings specific to an
organization

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 ACTIVITY

• Group Activity. Ask yourself “What clues can you gather by looking at
your university as an outsider?” Imagine you are an anthropologist
encountering your university in the wild for the first time. Use the
worksheet to document what seems to be particular to the people in
this organization. Who appear to be their heroes and legends? What
sayings do you hear? What customs and rituals do you observe? What
artifacts do they hold as having great importance?

• Worksheet: Heroes and Legends, language and saying, Customs,

values and belief, Artifacts.
 EXTERNAL ENVIRONMEN
• The term external environment refers to factors and forces outside the organization
that affect its performance
• Economic component - interest rates, inflation, changes in disposable income, stock
market fluctuations, and business cycle stages.
• The demographic component - population characteristics such as age, race, gender,
education level, geographic location, income, and family composition.
• The political/legal - federal, state, and local laws, as well as global laws and laws of
other countries. It also includes a country’s political conditions and stability.
• The sociocultural - societal and cultural factors such as values, attitudes, trends,
traditions, lifestyles, beliefs, tastes, and patterns of behavior. The
• Technological component - industrial innovations.
• Global component - issues associated with globalization and a world economy.
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