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Organizational Culture and Change

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1 Organizational Culture and Change
Chapter 10 Organizational Culture and Change Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

2 Chapter Outline What Is Organizational Culture?
Creating and Sustaining Culture Matching People With Organizational Cultures The Liabilities of Organizational Culture Approaches to Managing Change Resistance to Change Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

3 Organizational Culture
What is the purpose of organizational culture? How do you create and maintain organizational culture? What kind of organizational culture might suit you? Can organizational culture have a downside? How do organizations manage change? Why do people and organizations resist change? Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

4 Henry Mintzberg on Culture
“Culture is the soul of the organization — the beliefs and values, and how they are manifested. I think of the structure as the skeleton, and as the flesh and blood. And culture is the soul that holds the thing together and gives it life force.” Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

5 Organizational Culture
The pattern of shared values, beliefs, and assumptions considered to be the appropriate way to think and act within an organization. Culture is shared. Culture helps members solve problems. Culture is taught to newcomers. Culture strongly influences behaviour. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

6 Exhibit 10-1 Layers of Culture
Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

7 Levels of Culture Artifacts Beliefs Values Assumptions
Aspects of an organization’s culture that you see, hear, and feel Beliefs The understandings of how objects and ideas relate to each other Values The stable, long-lasting beliefs about what is important Assumptions The taken-for-granted notions of how something should be in an organization Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

8 Characteristics of Organizational Culture
Innovation and risk-taking The degree to which employees are encouraged to be innovative and take risks. Attention to detail The degree to which employees are expected to exhibit precision, analysis, and attention to detail. Outcome orientation The degree to which management focuses on results or outcomes rather than on technique and process. People orientation The degree to which management decisions take into consideration the effect of outcomes on people within the organization. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

9 Characteristics of Organizational Culture
Team orientation The degree to which work activities are organized around teams rather than individuals. Aggressiveness The degree to which people are aggressive and competitive rather than easygoing. Stability The degree to which organizational activities emphasize maintaining the status quo in contrast to growth. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

10 Exhibit 10-2 Contrasting Organizational Cultures
Organization B Managers must fully document all decisions. Creative decisions, change, and risks are not encouraged. Extensive rules and regulations exist for all employees. Productivity is valued over employee morale. Employees are encouraged to stay within their own department. Individual effort is encouraged. Management encourages and rewards risk-taking and change. Employees are encouraged to run with ideas, and failures are treated as learning experiences. Employees have few rules and regulations to follow. Productivity is balanced with treating its people right. Team members are encouraged to interact with people at all levels and functions. Many rewards are team based. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

11 Culture’s Functions Boundary-defining
Conveys a sense of identity for organization members Facilitates commitment to something larger than one’s individual self-interest Social glue that helps hold an organization together Provides appropriate standards for what employees should say or do Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

12 Culture’s Functions Serves as a “sense-making” and control mechanism
Guides and shapes the attitudes and behaviour of employees Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

13 Do Organizations Have Uniform Cultures?
Organizational culture represents a common perception held by the organization members. Core values or dominant (primary) values are accepted throughout the organization. Dominant culture Expresses the core values that are shared by a majority of the organization’s members. Subcultures Tend to develop in large organizations to reflect common problems, situations, or experiences. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

14 Exhibit 10-3 How Organizational Culture Forms
Selection criteria Socialization Organization's culture Philosophy of organization's founders Top management Selection criteria Socialization Organization's culture Philosophy of organization's founders Top management Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

15 Creating and Sustaining Culture: Keeping a Culture Alive
Selection Identify and hire individuals who will fit in with the culture. Top Management Senior executives establish and communicate the norms of the organization. Socialization Organizations need to teach the culture to new employees. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

16 A Socialization Model Socialization Process Outcomes Prearrival
Encounter Metamorphosis Socialization Process Outcomes Commitment Productivity Turnover Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

17 Exhibit 10-5 Four-Culture Typology
Fragmented Networked Low High Solidarity Mercenary Communal Sociability Source: Adapted from R. Goffee and G. Jones, The Character of a Corporation: How Your Company’s Culture Can Make or Break Your Business (New York: HarperBusiness, 1998), p. 21. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

18 Finding Your Culture Networked culture: you possess good social skills and empathy; you like to forge close, work-related friendships; you thrive in a relaxed and convivial atmosphere. Mercenary culture: you are goal-oriented, thrive on competition, like clearly structured work tasks. Fragmented culture: you are independent, have a low need to be part of a group atmosphere, are analytical rather than intuitive. Communal culture: you have a strong need to identify with something bigger than yourself and enjoy working in teams. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

19 The Liabilities of Culture
Culture can have dysfunctional aspects in some instances. Culture as a Barrier to Change When organization is undergoing change, culture may impede change. Culture as a Barrier to Diversity Strong cultures put considerable pressure on employees to conform. Culture as a Barrier to Mergers and Acquisitions Merging the cultures of two organizations can be difficult, if not impossible. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

20 Strategies For Merging Cultures
Assimilation Separation Integration Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

21 Change Agents People who act as catalysts and assume the responsibility for managing change activities. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

22 Outside agents Can offer an objective perspective.
Usually have an inadequate understanding of the organization’s history, culture, operating procedures, and personnel. Don’t have to live with the repercussions after the change is implemented. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

23 Internal agents Have to live with the consequences of their actions.
May be more thoughtful. May be more cautious. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

24 Approaches To Managing Change
Lewin’s Three-Step Model Kotter’s Eight-Step Plan for Implementing Change Action Research Appreciative Inquiry Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

25 Exhibit 10-6 Lewin’s Three-Step Change Model
Refreezing Moving Unfreezing Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

26 Lewin’s Three-Step Model For Implementing Change
Unfreezing Change efforts to overcome the pressures of both individual resistance and group conformity. Moving Efforts to get employees involved in the change process. Refreezing Stabilizing a change intervention by balancing driving and restraining forces. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

27 Exhibit 10-7 Unfreezing the Status Quo
Desired state Restraining forces Status quo Driving forces Time Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

28 Unfreezing Arouse dissatisfaction with the current state.
Activate and strengthen top management support. Use participation in decision making. Build in rewards. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

29 Moving Establish goals.
Institute smaller, acceptable changes that reinforce and support change. Develop management structures for change. Maintain open, two-way communication. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

30 Refreezing Build success experiences. Reward desired behaviour.
Develop structures to institutionalize the change. Make change work. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

31 Exhibit 10-8 Kotter’s Eight-Step Plan for Implementing Change
Establish a sense of urgency. Form a coalition. Create a new vision. Communicate the vision. Empower others to act. Develop short-term “wins.” Consolidate improvements. Reinforce changes. Source: Based on J. P. Kotter, Leading Change (Boston: Harvard Business School Press, 1996). Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

32 Action Research A change process based on the systematic collection of data and then selection of a change action based on what the analyzed data indicate. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

33 The Process of Action Research
Diagnosis Analysis Feedback Action Evaluation Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

34 Appreciative Inquiry An approach to change that seeks to identify the unique qualities and special strengths of an organization, which can then be built on to improve performance. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

35 Steps of Appreciative Inquiry
“Four D’s” Discovery Dreaming Design Destiny Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

36 Exhibit 10-9 Sources of Individual Resistance to Change
Selective Habit information processing Individual Resistance Security Fear of the unknown Economic factors Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

37 Cynicism About Change Feeling uninformed about what was happening.
Lack of communication and respect from one’s supervisor. Lack of communication and respect from one’s union representative. Lack of opportunity for meaningful participation in decision making. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

38 Exhibit 10-11 Sources of Organizational Resistance to Change
Threat to established resource allocations Structural inertia power relationships Limited focus of change Threat to expertise Group Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

39 Overcoming Resistance to Change
Education and communication This tactic assumes that the source of resistance lies in misinformation or poor communication. Best used: Lack of information, or inaccurate information Participation and involvement Prior to making a change, those opposed can be brought into the decision process. Best used: Where initiators lack information, and others have power to resist Facilitation and support The provision of various efforts to facilitate adjustment. Best used: Where people resist because of adjustment problems Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

40 Overcoming Resistance to Change
Negotiation and agreement Exchange something of value for a lessening of resistance. Best used: Where one group will lose, and has considerable power to resist Manipulation and cooperation Twisting and distorting facts to make them appear more attractive. Best used: Where other tactics won’t work or are too expensive Explicit and implicit coercion The application of direct threats or force upon resisters. Best used: Speed is essential, and initiators have power Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

41 Summary and Implications
What is the purpose of organizational culture? Organizational culture provides stability and gives employees a clear understanding of “the way things are done around here.” 2. How do you create and maintain culture? An organization’s culture is derived from the philosophy of its founders. It is communicated by managers and employees are socialized into it. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

42 Summary and Implications
What kind of organizational culture might suit you? Organizational cultures can be analyzed in terms of members’ friendliness (sociability) and task orientation (solidarity). 4. Can organizational culture have a downside? A strong culture can have a negative effect, including “pressure-cooker” cultures, barriers to change, difficulty in creating an inclusive environment, and hindering mergers and acquisitions. 5. How do organizations manage change? Kurt Lewin argued that successful change should follow three steps: unfreezing, moving, and refreezing. John Kotter built on Lewin’s work to offer an eight-step model. Two other theories include action research and appreciative inquiry. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

43 Summary and Implications
6. Why do people and organizations resist change? Individuals resist change because of basic human characteristics such as perceptions, personalities, and needs. Organizations resist change because they are conservative and because change is difficult. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

44 OB at Work Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

45 For Review 1. How can an outsider assess an organization’s culture?
2. What defines an organization’s subcultures? 3. Can an employee survive in an organization if he or she rejects its core values? Explain. 4. What benefits can socialization provide for the organization? For the new employee? 5. Describe four cultural types and the characteristics of employees who fit best with each. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

46 For Review 6. How can culture be a liability to an organization?
7. How does Lewin’s three-step model of change deal with resistance to change? 8. How does Kotter’s eight-step plan for implementing change deal with resistance to change? 9. What are the factors that lead individuals to resist change? 10.What are the factors that lead organizations to resist change? Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

47 For Critical Thinking 1. How are an individual’s personality and an organization’s culture similar? How are they different? 2. Is socialization brainwashing? Explain. 3. Can you identify a set of characteristics that describes your college’s or university’s culture? Compare them with several of your peers’ lists. How closely do they agree? 4. “Resistance to change is an irrational response.” Do you agree or disagree? Explain. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

48 Point-CounterPoint When Culture Can Change Why Culture Doesn’t Change
There is a dramatic crisis. There is a turnover in leadership. The organization is young and small. There is a weak culture. Why Culture Doesn’t Change Culture develops over many years, and becomes part of how the organization thinks and feels. Selection and promotion policies guarantee survival of culture. Top management chooses managers who are likely to maintain culture. Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada

49 Breakout Group Exercises
Form small groups to discuss the following: 1. Identify artifacts of culture in your current or previous workplace. From these artifacts, would you conclude that the organization has a strong or weak culture? 2. Have you or someone you know worked somewhere where the culture was strong? What was your reaction to that strong culture? Did you like that environment, or would you prefer to work where there is a weaker culture? Why? 3. Reflect on either the culture of one of your classes or the culture of the organization where you work, and identify characteristics of that culture that could be changed. How might these changes be made? Chapter 10, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition Copyright © 2007 Pearson Education Canada


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