Organizational Behavior: An Introduction to Your Life in Organizations

1. Organizational Behavior:An Introduction to Your Life in Organizations Chapter 17 Organizational Culture ©2007 Prentice Hall

2. Preview • Why is organizational culture so important to companies? • How do you discover an organization’s culture? • How do managers use organizational culture to improve organizational effectiveness? • What happens when organizations with different cultures merge? • How do you change an existing organizational culture? • How can you find an organizational culture in which you will thrive? ©2007 Prentice Hall

3. Why is organizational culture so important to companies? • An organization’s culture is its system of shared values and norms, along with related behaviors • Dominant culture: the system of values and norms held by most members • Subcultures: formal and informal groups and networks that may subscribe to some of these values and norms, but also have their own • Counter-cultures: those subcultures whose values and norms oppose those of the dominant culture of the company ©2007 Prentice Hall

4. Where do organizational cultures originate? • Three historical design factors: the personality and values of the founder, the historic period in which the company was founded, and the historic size of the company • The norms and values that typify organizations of different sizes • The business the company is in and the national and regional cultures in which the company is embedded ©2007 Prentice Hall

5. What is the difference between culture and climate? • Climate refers to organizational members’ perceptions of an organization’s policies, practices and procedures • Researchers are still figuring out precisely how organizational climate differs from organizational culture • Perhaps the two concepts cannot really be differentiated ©2007 Prentice Hall

6. How does national culture affect organizational culture? • Organizations reflect what the society they operate in emphasizes, for example, conformity or individualism • National cultures whose members prefer to avoid uncertainties tend to have companies with closed-system, bureaucratic cultures ©2007 Prentice Hall

7. What companies have built a reputation around their corporate cultures? • Lincoln Electric • Southwest Airlines • IBM • Hewlett Packard • Goldman Sachs • Starbucks • Infamous cultures: Enron and Arthur Anderson ©2007 Prentice Hall

8. What do you need to know to discover an organization’s culture? • A company’s culture exists on four levels: • Level 1: Behaviors and artifacts • Level 2: Shared perspectives • Level 3: Awareness • Level 4: Unconscious assumptions ©2007 Prentice Hall

9. How do new employees learn an organization’s culture? • Organizational socialization: the process by which new members’ values, norms and behaviors align with those of the organization and permit them to participate as members of the organization • Three stages: • Anticipatory socialization: impressions formed from company’s literature and interaction with interviewers, current employees, and other applicants • Encounter: the newcomer confronts the realities of your new organization • Metamorphosis: the newcomer attempts to become an accepted member of the culture by learning new attitudes and behaviors or modifying existing ones to conform ©2007 Prentice Hall

10. How does culture motivate performance? • Strong cultures, where the shared values and norms are clear, consistent and comprehensive and values are intensely held and widely shared have a modest positive relationship to performance • Cultural fit as a bureaucracy, market culture or clan can positively affect performance if it matches the situation ©2007 Prentice Hall

11. How does culture create commitment? • Organizational commitment, as you will recall, is being involved with, identifying with, and having an emotional attachment to one’s organization • Strong cultures enhance commitment • There is a strong relationship between worker commitment and higher returns for shareholders ©2007 Prentice Hall

12. How does culture integrate organizational units? • Creating a sense of community reduces competition and increases cooperation among organizational subunits (popular, but not accepted by all researchers) • Create a superordinate culture, which is a strong organizational culture with which all nationalities can identify (hard to do because of differences in national cultures) ©2007 Prentice Hall

13. How does culture motivate ethical behavior? • Reconciling professional and personal value systems: being able to fulfill personal values on the job improves job satisfaction • Designing organizational cultures to encourage moral expression • Designing cultures to value diversity ©2007 Prentice Hall

14. How does organizational culture enhance corporate branding? • Corporate branding: the process by which a distinct identity is created for a company • Employer branding: creating the same experience for employees that a company promises to its customers • Cause branding: a company is associated with supporting particular social causes ©2007 Prentice Hall

15. How does culture enhance service? • The emotions displayed by employees are related to how customers feel and how they evaluate the quality of the service they receive • Employees believing they are supported by their organization is important for job satisfaction and organizational commitment ©2007 Prentice Hall

16. How can managers foster acculturation? • Acculturation is “the process by which two or more cultures come into contact and resolve the conflict that arises as a result of this contact” • Four modes for merging cultures: • Assimilation • Integration • Separation • Deculturation ©2007 Prentice Hall

17. What is the effect of merging business systems on merging organizational cultures? • Business systems are the company’s particular methods and technologies for doing business • It is believed that cultural integration can only be accomplished when a moderate or full level of business systems integration is also part of the plan ©2007 Prentice Hall

18. How do you change an existing organizational culture? • Target: • organizational values and norms • the managerial culture • organizational heroes • organizational myths and stories • organizational rites, rituals, and taboos • cultural symbols and other aspects of objective culture ©2007 Prentice Hall

19. What kind of culture do you prefer? • Individuals differ on whether they prefer cultures that have a concern for people or cultures that have a concern for goal accomplishment • Finding a cultural fit is a straightforward matter if you know your own personality and get an accurate, complete overview of a company’s culture ©2007 Prentice Hall

20. Will you face a glass ceiling? • The glass ceiling is the invisible barrier between middle and top management positions that is said to exist for women and other minorities • Companies that are seriously interested in developing women & minorities as top managers should make several cultural interventions ©2007 Prentice Hall

21. Apply what you have learned • A Once World Class Company: Arthur Andersen • Advice from the Pro’s • Gain Experience • Can you solve this manager’s problem? ©2007 Prentice Hall

22. Summary – Why is organizational culture so important to companies? • An organization’s culture may affect a company’s profitability, and it acts as a subtle control mechanism on employee behavior • Subcultures and counter-cultures create both productive and counterproductive conflict in an organization • Cultures originate in the historical foundations of the company, the business the company is in, and the company’s national and regional origins • Some companies have built their reputations, in part, around their organizational cultures ©2007 Prentice Hall

23. Summary – How do you discover an organization’s culture? • A company’s culture exists on four levels: • behaviors and artifacts • shared perspectives on rules and norms • general awareness of ideals, standards and goals • unconscious assumptions • Employees learn a company’s culture through the process of organizational socialization ©2007 Prentice Hall

24. Summary – How do managers use organizational culture to improve organizational effectiveness? • Strong organizational cultures are where the norms and values of the company are clear and comprehensive, and values are intensely held and widely shared • Strong organizational cultures may enhance individual and company performance; they can also lead a company energetically in the wrong direction • They may enhance corporate branding through the processes of employer branding and cause branding ©2007 Prentice Hall

25. Summary – What happens when organizations with different cultures merge? • Companies that merge go through one of these processes for acculturation: • Assimilation • Integration • Separation • Deculturation • Performing a bicultural audit before the merger can help avoid acculturative stress and merger failure. ©2007 Prentice Hall

26. Summary – How do you change an existing organizational culture? • Once established, cultures are hard to change • Companies that do try to change their cultures emphasize new policies, new rituals, and new ways of leading • Typically they hire people who fit into the new culture ©2007 Prentice Hall

27. Summary – How can you find an organizational culture in which you will thrive? • Individuals have cultural preferences • Sometimes you do not fit into your company’s corporate culture or subculture, a fact that may create serious career consequences ©2007 Prentice Hall