McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-1

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-2 Chapter Organizational Culture 2 2

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-3 Introduction National culture: the sum total of the beliefs, rituals, rules, customs, artifacts, and institutions that characterize the population A nation’s culture and sub-cultures effect how organizational transactions are conducted Learning to operate in a world influenced by national culture is becoming a requirement for effective management A nation’s culture and sub-cultures effect how organizational transactions are conducted Learning to operate in a world influenced by national culture is becoming a requirement for effective management

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-4 Organizational Culture and Society’s Values (1 of 2) Values – the conscious, affective desires or wants of people that guide their behavior Organizations are able to operate efficiently only when shared values exist among the employees An individual’s personal values guide behavior on and off the job

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-5 Organizational Culture and Society’s Values (2 of 2) Values are a society’s ideas about what is right or wrong Values are passed from one generation to the next

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-6 Hofstede’s Four Value Dimensions (1 of 2) DimensionDescription Power Distance The level of acceptance by a society of the unequal distribution of power in organizations In higher power distance cultures, employees acknowledge the boss’s authority and follow the chain of command The result is a more centralized authority and structure Uncertainty Avoidance The extent to which people in a society feel threatened by ambiguous situations Countries with a high level of uncertainty avoidance tend to have specific rules, laws, and procedures Managers in these countries tend towards low-risk decision-making Employees exhibit little aggressiveness

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-7 Hofstede’s Four Value Dimensions (2 of 2) DimensionDescription Individualism The tendency of people to fend for themselves and their family In countries that value individualism, individual initiative and achievement are highly valued and the relationship of the individual with organizations is one of independence Masculinity The extent to which assertiveness and materialism is valued In highly masculine societies, there is considerable job stress and conflict between job and family roles

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-8 Cultural Values (1 of 4) Region / Country Individualism- Collectivism Power Distance Uncertainty Avoidance Masculinity- Femininity Other Dimensions North America (USA) IndividualismLowMediumMasculine JapanCollectivismHigh and Low HighMasculine and Feminine Amae (mutual dependence) ChinaCollectivismLow Masculine and Feminine Emphasis on tradition, Marxism, Leninism, and Mao Zedong thought

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-9 Cultural Values (2 of 4) Region / Country Individualism- Collectivism Power Distance Uncertainty Avoidance Masculinity- Femininity Other Dimensions Europe: Anglo Germanic West Slavic West Urgic Near Eastern Balkanic Nordic Individualism Medium individualism Collectivism Medium/high individualism Low/ medium Low High Low Low/medium Medium/high High Low/medium Masculine Medium/high masculine Medium masculine Feminine

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Cultural Values (3 of 4) Region / Country Individualism- Collectivism Power Distance Uncertainty Avoidance Masculinity- Femininity Other Dimensions Europe: (cont’d) Latin Europe East Slavic Individualism Medium/high individualism Collectivism Low/medium High Low Low/medium High Medium Masculine Medium masculine Masculine

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Cultural Values (4 of 4) Region / Country Individualism- Collectivism Power Distance Uncertaint y Avoidance Masculinity- Femininity Other Dimensions AfricaCollectivismHigh FeminineColonial traditions; tribal customs Latin AmericaCollectivismHigh MasculineExtroverted; prefer orderly customs and procedures

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved A society’s values have an impact on organizational values because of the interactive nature of work, leisure, family, and community.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Organizational culture – what the employees perceive and how this perception creates a pattern of beliefs, values, and expectations.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Edgar Schein’s Definition of Culture: A pattern of basic assumptions – invented, discovered, or developed by a given group as it learns to cope with the problems of external adaptation and internal integration – that has worked well enough to be considered valid and, therefore, to be taught new members as the correct way to perceive, think, and feel in relation to those problems.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Schein’s Three-Layer Organizational Culture Model Layer III: Basic Assumptions Layer II: Values Layer I: Artifacts & Creations Examples of cultural attributes  Documents  Physical layouts  Furnishings  Language  Jargon  Work ethic and practice  Fair day’s work for a fair day’s pay  Loyalty  Commitment  Helping others  Performance leads to rewards  Management equity  Competency counts Visible but often not decipherable Greater level of awareness Taken for granted, invisible, preconscious  Relationship to environment  Nature of reality, time, & space  Nature of human nature  Nature of human activity  Nature of human relations  Testable in the physical environment  Testable only by social consensus  Technology  Art  Visible and audible behavior patterns

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Organizational Culture and Its Effects Strong Culture Weak Culture

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved. 2-17H O M E Methods Intervening Conditions Outcome The Evolution of a Positive Culture Cohesive organizational culture Develop a sense of history Create a sense of oneness Promote a sense of membership Increase exchange among members Elaborate on history Communications about and by “heroes” and others Leadership and role modeling Communicating norms and values Reward systems Career management and job security Recruiting and staffing Socialization of new staff members Training and development Member contact Participative decision making Inter-group coordination Personal exchange

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Three Views on Influencing Cultural Change: (1 of 2) 1.Cultures are so elusive and hidden that they cannot be adequately diagnosed, managed, or changed 2.Because it takes difficult techniques, rare skills, and considerable time to understand a culture and then additional time to change it, deliberate attempts at culture change are not really practical

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Three Views on Influencing Cultural Change: (2 of 2) 3. People will naturally resist change to a new culture Cultures sustain people through periods of difficulty and serve to ward off anxiety Cultures provide continuity and stability

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Changing Culture Intervention Points Hiring and socialization of members who fit in with the culture Culture Removal of members who deviate from the culture Cultural communications Justifications of behavior Behavior Managers seeking to create culture change must intervene at these points.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Socialization and Culture Socialization – the process by which organizations bring new employees into the culture.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved The Process of Organizational Socialization Careful selection of entry-level candidates Start DeselectDeselect Humility-inducing experiences promote openness toward accepting organizational norms and values Teaches the new entrant that he/she doesn’t know everything about the job or company In-the-trenches training leads to mastery of a core discipline Extensive and reinforced on-the- job experience Rewards and control systems are meticulously refined to reinforce behavior that is deemed pivotal to success in the marketplace Adherence to values enables the reconciliation of personal sacrifices Reinforcing folklore Keeping alive stories that validate the organization’s culture Consistent role models Reward and recognize individuals who have done the job well

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Socialization Stages Anticipatory Socialization Accommodation Role Management

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved A Checklist of Effective Socialization Practices (1 of 2) Anticipatory socialization Recruitment using realistic job previews Selection and placement using realistic career paths Role management socialization Provision of professional counseling Adaptive and flexible work assignments Sincere person-oriented managers

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved A Checklist of Effective Socialization Practices (2 of 2) Accommodation socialization Tailor-made and individualized orientation programs Social as well as technical skills training Supportive and accurate feedback Challenging work assignments Demanding but fair supervisors

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Mentor – a friend, coach, advisor or sponsor who supports, encourages, and helps a less experienced protégé.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Mentoring Guidelines (1 of 2) 1.Do not dictate mentoring relationships, but encourage leaders/managers to serve a mentors 2.Train mentors in how to be effective in mentoring others 3.Include in the firm’s newsletter or in other forms of mass communication (print and electronic) an occasional story of mentoring as reported by a current top-level executive

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Mentoring Guidelines (2 of 2) 4.Inform employees about the benefits and difficulties of mentor relationships with individuals of different race and gender 5.Make sure there is diversity among the mentors 6.All mentors should be trained in dealing with diversity

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Phases of the Mentor Relationship InitiationCultivation SeparationRedefinition

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Cultural Diversity Diversity – the vast array of physical and cultural differences that constitute the spectrum of human differences. The managerial challenge will be to identify ways to integrate the increasing number and mix of people from diverse national cultures into the workplace.

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Workforce diversity issues for managers to consider: (1 of 2) Coping with employees’ unfamiliarity with the English language Increased training for service jobs that require verbal skills Cultural (national) awareness training for the current workforce Learning which rewards are valued by different ethnic groups

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Workforce diversity issues for managers to consider: (2 of 2) Developing career development programs that fit the skills, needs, and values of the ethnic group Rewarding managers for effectively recruiting, hiring, and integrating a diverse workforce Focusing not only on ethnic diversity, but also learning more about the diversities of age, gender, and workers with disabilities

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Spirituality and Culture Spirituality – employees have a personal or inner life that nourishes and is nourished by performing relevant, meaningful, and challenging work Workplace spirituality is not the same as religion Spirituality is a path, is personal and private, contains elements of many religions, and points to a person’s self- inquiry

McGraw-Hill/Irwin© 2005 The McGraw-Hill Companies, Inc. All rights reserved Research on spirituality and work dimensions indicates: Employees who are more spiritually involved achieve better results Spirituality encourages: trust work/life balance empathy and compassion about others the value of human assets the full development and self-actualization of people ethical behavior