Organization Culture

Schein’s (1996) definition Organizational culture is “the set of shared, taken-for-granted, implicit assumptions that a group holds and that determines how it perceives, thinks about and reacts to its various environments.” It’s shared Property of the work unit (group, team or even organization as a whole) Implicit assumptions Not necessarily in awareness most of the time Has consequences Sum of values and rituals which serve as ‘glue’ to integrate the members of the organization. Shapes how organizational employees act

A functional theory of organizational culture Organizational culture is the pattern of basic assumptions that a given group has invented, discovered, or developed in learning to cope with its problems of external adaptation and internal integration, and that have worked well enough to be considered valid, and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems. Schein’s 1984

Content of Organizational Cultures Artifacts Shared beliefs & values Basic assumptions

Where does organizational culture come from?

Organization culture often build on top of national culture Culture = integrated system of learned behavior patterns which are characteristic of the members of a group (society, corporation, fraternity)  

Geert Hofstede Dutch social psychologist Industrial psychologist at IBM from 1967-73 Surveys from 116,000 IBM employees from 40 countries Factor analysis to identify first 4 & then later 5 distinct dimensions of cultural values

Hofstede’s values

Hofstede’s Framework Primarily descriptive taxonomy about how cultures differ Individualistic vs Collectivist dimensions used most Not a theory, with causal explanations for Why the cultural differences came to be What consequences they would have

Individualism vs Collectivism Degree to which individuals are integrated into groups. The fundamental issue addressed by this dimension is the degree of interdependence a society maintains among its members. It has to do with whether people´s self-image is defined in terms of “I” or “We”. In Individualist societies people are supposed to look after themselves and their direct family only. In Collectivist societies people belong to ‘in groups’ that take care of them in exchange for loyalty.

Measuring Individualism/Collectivism How much do you agree with the following statements: Individuals should sacrifice self-interest for the group. Individuals should stick with the group even through difficulties. Group welfare is more important than individual rewards. Group success is more important than individual success. Individuals should only pursue their goals after considering the welfare of the group. Group loyalty should be encouraged even if individual goals suffer.

Individualism vs Collectivism Ties between individuals are loose: everyone is expected to look after him/herself and his/her immediate family.  Stress on personal achievements and individual rights Everyone expected to fulfill their own needs Everybody has the right to own opinion. People are integrated into strong, cohesive in-groups, often extended families (with uncles, aunts and grandparents) which continue protecting them in exchange for unquestioning loyalty. Stress on group pride & solidarity

Array yourself on the 7-point scale Individualism vs Collectivism You have a 14 year old brother. He has been taking piano lessons since he was seven. He now wants to quit, and start playing electric guitar in a band with some buddies, but your parents are opposed. They think the piano is a better instrument and that your brother will regret his decision when he gets older. Who do you support – brother or father?

Scores by country: Individualism http://www.geert-hofstede.com/hofstede_dimensions.php http://www.clearlycultural.com/geert-hofstede-cultural-dimensions/individualism/

Where does organizational culture come from? Shein (1984): Most cultural solutions in new groups and organizations originate from the founders and early leaders Jobs: Perfectionism & design at Apple Kelly: Culture of “wisdom” & combination at Ideo Zuckerberg: Hacker culture at Facebook Kalanick: Frat-like, sexist culture at Uber (e.g., see Maimi letter) Advocate ways of doing things that are adopted or rejected, depending on how well they work.

Founders/Leaders as important source of organizational culture The process of culture formation is the process of creating a small group: single person (founder) has idea. founder brings in one or more people and creates core group. They share vision and believe in the risk. founding group acts in concert, raises money, work space... Others are brought in and a history is begun.

Culture as a response to core external problems

Culture as a response to core internal problems of coordination

Amazon’s values & assumptions

Amazon 14 Leadership Principles Customer Obsession Ownership Invent and Simplify Hire and Develop The Best Insist on the Highest Standards Think Big Dive Deep Frugality Learn and Be Curious Earn Trust Have Backbone; Disagree and Commit Bias for Action Are Right, A Lot Deliver Results http://www.amazon.jobs/principles

Uber’s values and assumptions External Game changing: Disregard for established industries & municipal regulation Arms length relationship with driver contractors Internal “Game-of-thrones political war raging within the ranks of upper management” with “every manager was fighting their peers and attempting to undermine their direct supervisor so that they could have their direct supervisor's job” Sexist treatment of women

Ideo’s values & assumptions

Apple values & assumptions Based on ideal that self-motivated individuals will work harder if they do not have a boss micromanaging every action Brutal & unforgiving place where accountability is strictly enforce Never any confusion as to who is responsible for what. “DRI” = Directly Responsible Individual Every meeting ends with an action list

Facebook Facebook is defined by our hacker culture - an environment that rewards creative problem solving and rapid decision making. We encourage people to be bold. Our open culture keeps everyone informed and allows people to move around and solve the problems they care about most. We work in small teams and move fast to develop new products, constantly iterating and improving. The phrase “this journey is 1% finished” is posted on our walls, reminding us that we’ve only begun to fulfill our mission to bring the world closer together

Storyboard for CMU’s culture Make a storyboard for a three minute video that would show someone from Mars what it means to be a member of the CMU culture overall or one of its subgroups. Highlight the strengths of the culture and one flaw.

Abstracting Organization Culture Flexibility & Discretion Internal focus: Integration External focus: Differentiation Stability & Control From Figure 3 in Cameron, K. S., Quinn, R. E., DeGraff, J., & Thakor, A. V. (2014). Competing values leadership: Edward Elgar Publishing.

Taxonomy of Organizational Cultures: Competing Values Framework From Figure 3 in Cameron, K. S., Quinn, R. E., DeGraff, J., & Thakor, A. V. (2014). Competing values leadership: Edward Elgar Publishing.

Key assumptions Table 13-1 in Quinn, R. E., & Kimberly, J. R. (1984). Paradox, planning, and perseverance: Guidelines for managerial practice. Managing organizational transitions (pp. 295-313).

Some measurement instruments Sources Clan Culture Descriptors Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Some measurement instruments Sources Adhocracy Culture Descriptors Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Some measurement instruments Market Culture Descriptors Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Some measurement instruments Hierarchical Culture Descriptors Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Where do the Amazon’s & Ideo’s cultures fit into this taxonomy? Zappos

Relationship among types These cultures are not mutually exclusive: Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

How do these influence organizational success? Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Meta-analysis: Organizational culture & employee attitudes Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Meta-analysis: Organizational culture & employee attitudes Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Meta-analysis: Organizational culture & employee attitudes

Meta-analysis: Organizational culture & subjective financial effectiveness Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

Meta-analysis: Organizational culture & objective financial effectiveness Hartnell, C. A., Ou, A. Y., & Kinicki, A. (2011). Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, 96(4), 677.

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