Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 1 Chapter 18 Organizational Culture and Cultural Diversity

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 2 Learning Objectives Describe the elements of a culture. Compare and contrast four types of organizational culture. Discuss several types of subcultures that may exist in organizations. Describe several activities for successfully managing diversity.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 3 The Elements Of A Culture A culture is the unique pattern of shared assumptions, values, and norms that shape the socialization, symbols, language, narratives, and practices of a group of people. –Shared assumptions are the underlying thoughts and feelings that members of a culture take for granted and believe to be true. –A value is a basic belief about something that has considerable importance and meaning to individuals and is stable over time. –Norms are rules that govern the behaviors of group members.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 4 The Elements Of A Culture (cont.) Socialization is a process by which new members are brought into a culture. A symbol is anything visible that can be used to represent an abstract shared value or something having special meaning. Language is a shared system of vocal sounds, written signs, and/or gestures used to convey special meanings among members of a culture. Narratives are the unique stories, sagas, legends, and myths in a culture. Shared practices –Taboos are culturally forbidden behaviors. –Ceremonies are elaborate and formal activities designed to generate strong feelings.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 5 The Culture Iceberg (adapted from Figure 18.1)

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 6 Types of Organizational Cultures (adapted from Figure 18.2) Bureaucratic Culture Entrepreneurial Culture Market Culture Formal Control Orientation Focus of Attention InternalExternal Stable Flexible Clan Culture

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 7 Subcultures Within Organizations An organizational subculture exists when assumptions, values, and norms are shared by some—but not all—organizational members.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 8 Why Many Organizations Have Subcultures The organization was created from a merger or acquisition.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 9 Reasons for M&A Failures (adapted from Figure 18.3) Inability to manage target business Reason for merger failure Inability to implement change in new organization Percent of executives who state reason as primary explanation for merger failures Incompatible cultures Synergies were overstated Clash of management styles/egos Percent

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 10 Why Many Organizations Have Subcultures (cont.) Departments and divisions within the organization have their own subcultures. –Occupational subcultures –Geographically based subcultures –Subcultures created by managers Positive cultures are created by managers who: recognize personal milestones, such as birthdays and employment anniversaries; hold public celebrations for professional achievements; sponsor picnics and parties; and listen to their employees and recognize the efforts they put into work.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 11 Why Many Organizations Have Subcultures (cont.) A diverse workforce creates subcultures –Workforce demographics Ethnicity Age Gender and other demographics

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 12 Managing Cultural Diversity Cultural diversity encompasses the full mix or the cultures and subcultures to which members of the workforce belong.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 13 What Companies Cover in Diversity Initiatives (adapted from Figure 18.4) Areas of coverage Percent Language Religion Sexual orientation Disability Age Gender Race/ethnicity Percentage of companies with programs

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 14 Managing Cultural Diversity (cont.) Organization goals for managing cultural diversity include: –legal compliance, –creating a positive culture for employees, and –creating economic value.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 15 The Process Of Change Diagnosis - Before managers begin to design new approaches to managing diversity they must understand how current practices affect the amount and nature of diversity. Vision - Leaders must formulate and articulate a clear vision to persuade others to join them. Involvement - For the plan to be effective, those who are affected must buy into it. Timing - Planned organization change usually follows an evolutionary — not revolutionary — path.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 16 Diversity Training Awareness training is designed to provide accurate information about the many subcultures present in the organization. Harassment training is aimed at ensuring that employees understand the meaning of harassment and the actions the company will take when someone complains of being harassed.

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 17 Growth in Prevalence of Work/Family Benefits (adapted from Figure 18.5) Percentage U.S. firms offering benefit Type of benefit Onsite child care Adoption assistance Bring child to work in emergency Compressed workweek Flextime Family leave beyond legal requirement

Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 18 Organization Change Challenges Managing the reactions of the members of the dominate culture, who may feel that they have lost some of the power the previously had. Synthesizing the diversity of opinions form individuals and using them as the basis for reaching meaningful agreement on issues. Avoiding real and perceived tokenism and quota systems that can help the organization achieve its quantitative goals but can be destructive to developing a positive culture.