1. Organizational Culture
BUSI 2311/Spring2011/Ashvari.S

2. Lesson Outline What is organizational culture?
Dimensions of organizational culture
Strong VS Weak culture
How employee learn culture?
Other issues
Activity, Case Study
Refer textbook chapter 3 - page 59 – 83
* note that environment covered in chapter 3

3. What is Organizational Culture?
Culture refers to a system of shared meaning within an organization that determines in large degree, how employees act.
When confronted with problems or work issues, the organizational culture – the “way we do things around here” – influences what employees can do and how they conceptualize, define, analyze and resolve issues
When we describe someone as warm, open and shy, we’re describing personality. An organization, too has a personality, which is call its culture.
It’s the shared values, principles, traditions and ways of doing things that influence the way organizational members act.

4. Dimensions or Characteristics of Organizational Culture
Attention to detail – degree to which employees are expected to exhibit analysis and attention to detail
Innovation and Risk taking – degree to which employees are encouraged to be innovative and to take risks
Stability – degree to which organizational decisions and actions emphasize maintaining the status
Aggressiveness – degree to which employees are aggressive and competitive rather than cooperative
Team orientation – degree to which work is organized around teams rather than individuals
People orientation – degree to which management decisions take into account the effects on people in the organization
Outcome orientation – degree to which managers focus on results or outcomes rather than on how these outcomes are achieved

5. Activity Refer Exhibit 3-2 and 3-3 Contrasting Organizational Cultures
(15 minutes)

6. Culture involves 3 things:
Culture is a perception – individual perceive the organizational culture on the basis of what they see, hear or experience within the organization
Shared aspect of culture – even though individuals may have different backgrounds or work at different organization levels, they to describe the organizational culture in similar terms
Its concerned with how members recognize the organization, not with whether they like it.

7. Do organizations Have Uniform Cultures?
Organizational culture represents a common perception held by the organization’s members
This was made explicit when we defined culture as a system of shared meaning.
Most large organizations have a dominant culture and numerous sets of subcultures.
A dominant culture expresses the core values that are shred by a majority of the organization’s members
Subcultures tend to develop in large organizations to reflect common problems, situations or experiences that members face. These subcultures are likely to be defined by department designations. E.g. purchasing department, for example can have a subculture that is uniquely shared by members of that department.
It will include the core values of the dominant culture plus additional values unique to members of the purchasing department.

8. Strong VS Weak Cultures
Although all organizations have cultures, not all cultures have an equal impact on employees’ behavior and actions
Strong cultures refers to organizations in which the key values are strongly held and widely shared
The more that employees accept the organizations key values and the greater their commitment to those values, the stronger the culture is
Whether an organization’s culture is strong, weak or somewhere in between depends on factors such as the size of the organization, how long it has been around
Exhibit 3-4

9. Culture Versus Formalization
A strong culture increases behavioural consistency
High formalization in an organization creates predictability and consistency
Therefore, we should view formalization and culture as two different roads to a common destination
The stronger an organization’s culture, the less management need to concerned with developing formal rules and regulations to guide employee behaviour

10. What Do Cultures Do?
Culture’s Functions – culture performs a number of functions within an organization.
It has a boundary-defining role; that is, it creates distinctions between one organization and others
It conveys a sense of identity for organization members
Culture facilitates the generation of commitment to something larger than one’s individual self-interest
Provide appropriate standards for what employees should say and do

11. 2. Culture as a Liability – we haven’t said that it’s good or bad, only that it exists. Culture enhances organizational commitment and increases the consistency of employee behaviour. From an employee’s standpoint, culture is valuable because it reduces ambiguity. It tells employees how things are done and what’s important.
However, it may burden the organization and make it difficult to respond to changes in the environment – barriers to change
Hiring new employees who, because of race, age, disability or other differences, are not like the majority of the organization members creates a paradox - barriers to diversity
Barriers to Acquisitions and Merger

12. Creating and Sustaining Culture
How a Culture begins – an organization’s current customs, general way of doing things are largely due to what it has done before and the degree of success it has had with those endeavors.
The founders of an organization traditionally have a major impact on that organization’s early culture
2. Keeping a Culture alive – once a culture is in place, there are practices within the organization that act to maintain it by giving employees a set of similar experiences. Three forces play a particularly important part in sustaining a culture:
a. selection
b. top management
c. socialization

13. How employees learn culture
Culture is transmitted to employees in a number of ways. The most significant are:
Stories – organizational “stories” typically contain a narrative of significant events or people including such things as the rule breaking, reactions to past mistakes and so on. These stories provide prime examples that people can learn from.
Rituals – corporate rituals are repetitive sequences of activities that express and reinforce the values of the organization, what goals are most important, which ones are expendable, which people are important. E.g. sales people those meeting targets are given attractive bonus, gifts. This “show” acts as a motivator

14. 3. Material symbols – when walk into different organization, you do get a “feel” for the place – formal, casual, fun, serious so on. These feelings you get demonstrate the power of material symbols in creating an organization’s personality.
4. Language – many organizations and units within organizations use language as a way to identify members of a culture. Over time, organizations often develop unique terms to describe equipment, key personnel, suppliers and so on. Once learned, this language acts as a common denominator that unites members of a given culture.

15. Activity Describe how you think PMU new students “learn” the culture.
(10 minutes)

16. Creating an Ethical Organizational Culture
Be a visible role model – employees will look to top-management behavior as a benchmark for defining appropriate behaviour
Communicate ethical expectations – ethical ambiguities can be minimized by creating and disseminating an organizational code of ethics
Provide ethical training – set up seminars
Visibly reward ethical acts and punish unethical ones
Provide protective mechanism – provide formal mechanisms to that employees can discuss ethical dilemmas and report unethical behavior without fear

17. Creating a Customer-Responsive Culture –
Key variables shaping customer responsive cultures: type of employees themselves, low formalization, empowerment, good listening skills.
A number of actions that management can take if wants to make its culture more customer responsive:
Selection – hiring
Training and socialization
Structural design – give employee more control
Empowerment – low formalization
Performance evaluation – behavioural based evaluation
Reward system
Exhibit 3-8

18. Spirituality and Organizational Culture
Workplace spirituality recognizes that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of community
Characteristics of a spiritual organization:
Strong sense of purpose – people want to be motivated by a purpose that they believe is important rather than profit as primary values
Focus on individual development
Trust and respect
Humanistic work practice – human rights, empowerment
Toleration of employee expression

19. refer page 71 – Creating an Inclusive Workplace Culture

20. Current organizational culture issues facing managers
Four current cultural issues managers should consider:
Creating an ethical culture – ethical behaviour of its member. Some suggestions are: be a visible role model, communicate ethical expectations, provide ethics training, visibly reward ethical acts and punish unethical ones
Creating an innovative culture – the fact is that successful organizations in all types of industries need cultures that support innovation. Its managers states that organization’s culture is based on involvement, communication, creativity and diversity, which they see as keys to innovation
Creating a Customer-Responsive Culture – employees willing to take initiative, even when it’s outside their normal job requirements, to satisfy a customer’s need. This can be done through: hiring service-contact people with the personality consistent with customer service, train customer service people continuously, empower service-contact employees.
Spirituality and organization culture – it’s a culture where organizational values promote s sense of purpose through meaningful work that takes place in the context of community. Organizations with a spiritual culture recognize that people have a mind and a spirit, seek to find meaning and purpose in their work and desire to connect with other human beings.

21. Case study :Making You Say Wow
Activity
Case study :Making You Say Wow
(Discuss)
Page 83

22. Learning Outcomes
Now students should be able to demonstrate a good understanding of the following:
Organizational culture
Dimensions of organizational culture
Strong VS Weak culture
How employee learn culture?
Other issues related to culture