1. Organizational Cultures, Innovation, and Change
Exploring Management
Chapter 9
Organizational Cultures,
Innovation, and Change

2. Chapter 9 What is the nature of organizational culture?
How do organizations support and achieve innovation?
How do manages lead the processes of organizational change?

3. 9.1 Organizational Culture
Organizational culture is the personality of the organization
Organizational culture shapes behavior and influences performance
The observable culture is what you see and hear as an employee or customer
The core culture is found in the underlying values of the organization
Value-based management supports a strong organizational culture
The culture of an organization is a driving force in the behavior of the organization’s employees.

4. ORGANIZATIONAL CULTURE Organizational Culture
Culture is the personality of the organization
Shared beliefs and values that guide behavior of organization members
Culture is reinforced as organizational members teach the culture to new members. It’s the “way we do things around here”. The group pictured has a culture that seems to require suits as proper business attire.

5. ORGANIZATIONAL CULTURE Strong Cultures
Organizational culture shapes behavior and influences performance
Strong cultures are clear, well defined and widely shared among members
Socialization helps new members learn the culture
Great cultures often value employees as highly as they value customers, or in this case, patients.

6. ORGANIZATIONAL CULTURE Observable Culture
Observable culture is what you see and hear
Stories about the founding of the company and legendary organizational members are part of the observable culture as well as traditions, colors and uniforms.

7. ORGANIZATIONAL CULTURE Organizational Culture
Core culture is the underlying values of the organization
Core values are the beliefs that shape behavior
Core values need to be demonstrated in actions as well as stated in documents.

8. ORGANIZATIONAL CULTURE Values
Values based management works hard to make sure the core values show
Symbolic leaders use language and symbols to establish and reinforce organizational culture
Symbolic leaders provide examples of how to act, speak, and treat others. They often preside over ceremonies, rites and rituals that reinforce the culture and reward those who exemplify the culture’s values.

9. ORGANIZATIONAL CULTURE Workplace Spirituality
Workplace spirituality involves creating meaning and community for employees
Common elements are meaningful work, respect for diversity, work life balance and ethical behavior
Symbolic leaders model and teach the culture and values
Workplace spirituality sometimes includes a focus on religious faith, but many organizations emphasize spirituality by valuing employees and providing a means for personal expression. It can be very motivating, as shown in the Self-Actualization level of Maslow’s hierarchy.

10. Organizations pursue process, product and business model innovations.
Green innovations pursue and support the goals of sustainability.
Social innovations seek solutions to important societal problems.
Commercializing innovation turns new ideas into stable products.
Innovative organizations share many common characteristics.
Innovative organizations are often very connected with the external environment.

11. Innovation Types of Innovation
Innovation – taking a new idea and putting it into practice
Process innovation results in better ways to do things
Product innovation results in new or improved goods or services
Business model innovations are new ways to make money
Information technology provides great examples. Online banking provides faster processing with convenience, Smart phones like the BlackBerry, Droid and iPhone are product innovations and online education is an example of how colleges have used technology for a business model innovation.

12. Innovation Types of Innovation
Green innovations
Earth friendly business models
Social innovations
Business models that help solve the world’s social problems
Social Entrepreneurship
Ways to solve social problems
“Green” companies and Social business models are very connected with the external environment and incorporate it into the organizational mission.

13. Innovation Commercializing Innovation
Turns ideas into products, services or processes
This process is critical to avoiding the many pitfalls of new product development. Studies have shown that less than 10% of new ideas result in successful new products.

14. Innovation Commercializing Innovation
Reverse innovation
takes products created for small or emerging markets and moves them into larger distribution
Reverse innovation often takes specialized products and moves them to the mainstream.

15. Innovation Innovative Organizations
Characteristics of highly innovative organizations
Strategy includes innovation
Culture values innovation
Structures support innovation
Management supports innovation
Staffing for creativity and innovation
Highly innovative organizations value innovation on all levels.

16. Organizations pursue both transformational and incremental changes.
9.3 Leading Change
Organizations pursue both transformational and incremental changes.
Three phases of planned change are unfreezing, changing and refreezing.
Managers use force-coercion, rational persuasion, and shared power change strategies.
Change leaders identify and deal positively with resistance to change.
Change comes in many degrees of size and urgency.

17. Organizational Change Types of Change
Change leaders
Leaders who take responsibility for change
Change leaders must have great persuasive skills.

18. Organizational Change Types of Change
Transformational change
Results in major and comprehensive redirection of the organization
Incremental change
Smaller change that aligns systems and practices with strategy
The recession created the need for transformational change in many organizations.

19. Organizational Change Change Process
Kurt Lewin described change as a three part process
The key here is Phase 3. There will be a tendency, for some time, on the part of managers to go back to the old way of doing things. Continued support and reinforcement is needed to avoid the problem.

20. Organizational Change Strategies for leading change
These strategies are consistent with the concept of the sources of authority being legitimate (force-coercion), knowledge (expertise) and charisma (reference).

21. 9.3 Organizational Change
Change leaders identify and deal positively with resistance to change
Positive tactics
Education and communication
Participation and involvement
Facilitation and support
Negotiation and agreement
Negative resistance tactics
Manipulation and cooptation
Explicit and implicit coercion
Long term acceptance of change is better when positive tactics are used.

22. 9.3 Organizational Change
Why people resist change
Fear of the unknown
Disrupted habits
Loss of confidence
Loss of control
Poor timing
Work overload
Loss of face
Lack of purpose
We all know how we feel when forced to make changes. Our employees are no different.