Organisational culture

Chapter learning objectives Describe the elements of organisational culture. Discuss the importance of organisational subcultures. List four categories of artefacts through which corporate culture is communicated. Identify three functions of organisational culture. Discuss the conditions under which cultural strength improves corporate performance. Discuss the effect of organisational culture on business ethics. Compare and contrast four strategies for merging organisational cultures. Identify five strategies to strengthen an organisation’s culture.  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Melso Minerals’ corporate culture Melso Minerals in Matamata, New Zealand, has an egalitarian, team-oriented corporate culture . This culture is apparent through numerous artefacts, such as the no-holds barred retreats and the Melso polo shirts that everyone wears. Courtesy of Melso Minerals (Matamata) Ltd  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Organisational culture defined The basic pattern of shared assumptions, values and beliefs considered to be the correct way of thinking about and acting on problems and opportunities facing the organisation. Courtesy of Melso Minerals (Matamata) Ltd  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Elements of organisational culture Physical structures Rituals/ceremonies Stories Language Beliefs Values Assumptions Artefacts of organisational culture Organisational culture  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Meaning of cultural content Cultural content refers to the relative ordering of beliefs, values and assumptions Example: Brown & Brown values aggressiveness; SAS Institute values work-life balance An organisation emphasises only a handful of the hundreds of cultural values  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Organisational subcultures Located throughout the organisation Can support or oppose (countercultures) firm’s dominant culture Two functions of countercultures: provide surveillance and evaluation source of emerging values  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Cultural stories at Four Seasons The legendary customer service at Four Seasons Hotels and Resorts is reflected in its corporate culture. Legends and stories help to support this customer service culture. Courtesy of Four Seasons Hotels and Resorts  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Artefacts: organisational stories Social prescriptions of desired behaviour Demonstrate that organisational objectives are attainable Most effective stories describe real people are assumed to be true are known throughout the organisation are prescriptive Courtesy of Four Seasons Hotels & Resorts  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Artefacts: rituals and ceremonies programmed routines eg conducting meetings Ceremonies planned activities for an audience eg award ceremonies  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Artefacts: organisational language Words used to address people, describe clients, etc Leaders use phrases and metaphors as cultural symbols eg General Electric’s ‘grocery store’ Language also found in subcultures eg Whirlpool’s ‘PowerPoint culture’  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Artefacts: physical structures/space Oakley, Inc.’s protective and competitive corporate culture is apparent in its building design and workspace. The building looks like a vault to protect its cherished product designs (eyewear, footwear, apparel and watches). Courtesy of Oakley, Inc. Courtesy of Oakley, Inc.  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Benefits of strong corporate cultures Social control Strong organisational culture Social glue Aids sense-making  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Problems with strong cultures Culture content might be incompatible with the organisation’s environment Strong cultures focus attention on one mental model Strong cultures suppress dissenting values from subcultures  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Adaptive organisational cultures External focus  firm’s success depends on continuous change Focus on processes more than goals Strong sense of ownership Proactive  seek out opportunities  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Bicultural audit Part of ‘due diligence’ in merger Minimises risk of cultural collision by diagnosing companies before merger Three steps in bicultural audit 1. collect artefacts 2. analyse data for cultural conflict/compatibility 3. recommend solutions  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Merging organisational cultures Assimilation Acquired company embraces acquiring firm’s culture Deculturation Acquiring firm imposes its culture on unwilling acquired firm Integration Both cultures combined into a new composite culture Separation Merging companies remain separate with their own culture  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Strengthening organisational culture Founders and leaders Strengthening organisational culture Selection and socialisation Culturally consistent rewards Managing the cultural network Stable workforce  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Overview of the next chapter Lewin’s force field analysis model Reasons why people resist organisational change Strategies to minimise resistance to change The organisation development process Appreciative inquiry as a change strategy Ethical issues in organisation development  2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione

Organisational culture