Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 1 ©2001 by Prentice Hall, Inc. Chapter 14

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 2 ©2001 by Prentice Hall, Inc. Objectives Define organizational culture and explain its function Explain how it evolves and is transmitted Describe the characteristics of a strong culture Explain the relationship between strong cultures and high performance Describe how leaders can manage culture Identify the four stages in the organizational life cycle

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 3 ©2001 by Prentice Hall, Inc. Organizational Culture Pattern of shared values and beliefs that produce certain norms of behavior

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 4 ©2001 by Prentice Hall, Inc. Uncovering Levels of Culture Visible organizational structures and processes Strategies, goals, philosophies Unconscious, taken-for-granted beliefs, perceptions, thoughts, and feelings Artifacts Espoused Values Basic Underlying Assumptions

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 5 ©2001 by Prentice Hall, Inc. Sources of Culture Values of founder or strong leaders Learned solutions to problems over time

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 6 ©2001 by Prentice Hall, Inc. Transmitting Culture Via Socialization Stories Symbols Jargon Rituals and Ceremonies Statements of Principles

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 7 ©2001 by Prentice Hall, Inc. Functions of Organizational Culture Provides a sense of identity Generates commitment Helps people make sense of what’s going on Serves as a control mechanism

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 8 ©2001 by Prentice Hall, Inc. Strong Cultures Have more values and beliefs that are more widely shared and more ordered - - greater intensity and shared consensus of shared values-- than weak cultures

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 9 ©2001 by Prentice Hall, Inc. Characteristics of Strong Cultures Easily identified dominant values Selection process targets people who fit the culture Socialization and training teach newcomers “the ropes” Employees who don’t fit are fired Rewards for acting in accordance with the culture Leaders and managers send clear signals about desired values and norms

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 10 ©2001 by Prentice Hall, Inc. Strong Cultures Advantages High performance under certain conditions Clear sense of purpose More value-driven decision making Employee commitment Loyalty Pride Disadvantages Pressure for conformity Resistance to change

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 11 ©2001 by Prentice Hall, Inc. Strong Cultures and Performance Strong Culture Focus on Key Constituencies Leadership at all Levels High Performance

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 12 ©2001 by Prentice Hall, Inc. The Importance of Fit Organization’s task Environment Strategy People Culture

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 13 ©2001 by Prentice Hall, Inc. HOW LEADERS CREATE AND MODIFY CULTURE What they pay attention to, measure, and control regularly Their reaction to critical incidents and crises Deliberate role modeling, teaching, and coaching

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 14 ©2001 by Prentice Hall, Inc....HOW LEADERS CREATE AND MODIFY CULTURE Criteria for recruitment, selection, promotion, retirement, and termination Criteria used to allocate scarce resources Criteria for allocating rewards and status

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 15 ©2001 by Prentice Hall, Inc. Organization Stages of Development Size Small Large 1. Entrepreneurial Stage 4. Elaboration Stage 3. Formalization Stage 2. Collectivity Stage Renewal Decline Continuing maturity

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 16 ©2001 by Prentice Hall, Inc. Five Phases of Growth

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 17 ©2001 by Prentice Hall, Inc. Organizational Practices in the Five Phases of Growth

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 18 ©2001 by Prentice Hall, Inc. Three Cultures of Management Engineering culture Executive Culture Operator culture

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 19 ©2001 by Prentice Hall, Inc. Assumptions of the Operator Culture Enterprise’s success depends on people’s knowledge, skill, learning ability, and commitment. Required knowledge and skills are “local” and based on core technology.

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 20 ©2001 by Prentice Hall, Inc....Assumptions of the Operator Culture Operators need the capacity to learn and to deal with surprises. Work must be done in a collaborative manner that values communication, openness, mutual trust, and commitment.

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 21 ©2001 by Prentice Hall, Inc. Assumptions of the Engineering Culture Engineers are proactively optimistic that they can and should master nature. Engineers are stimulated by puzzles and problems with pragmatic, perfect, and “people free” solutions.

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 22 ©2001 by Prentice Hall, Inc....Assumptions of the Engineering Culture The ideal world is made of elegant machines and processes working in perfect precision and harmony without human intervention. Engineers are safety oriented and overdesign for safety. Engineers prefer linear, simple cause- and-effect, quantitative thinking.

Organizational Behavior: An Experiential Approach 7/E Joyce S. Osland, David A. Kolb, and Irwin M. Rubin 23 ©2001 by Prentice Hall, Inc. Assumptions of the Executive Culture Financial focus Self-image: the Embattled Lone Hero Hierarchical and individual focus Task and control focus