Chapter 15 Nelson Quick Organizational Culture Copyright 2005

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Chapter 15 Nelson & Quick Organizational Culture Copyright © 2005 by South-Western, a division

Chapter 15 Nelson & Quick Organizational Culture Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved.

Organizational (Corporate) Culture A pattern of basic assumptions that are considered valid and that

Organizational (Corporate) Culture A pattern of basic assumptions that are considered valid and that are taught to new members as the way to perceive, think, and feel in the organization

Artifacts - symbols of culture in the physical and social work environment Values Espoused:

Artifacts - symbols of culture in the physical and social work environment Values Espoused: what members of an organization say they value Enacted: reflected in the way individuals actually behave Assumptions - deeply held beliefs that guide behavior and tell members of an organization how to perceive and think about things Levels of Organizational Culture

Artifacts Personal enactment Ceremonies and rites Stories Ritual Symbols Values Testable in physical environment

Artifacts Personal enactment Ceremonies and rites Stories Ritual Symbols Values Testable in physical environment Testable only by social consensus Assumptions Relationship to environment Nature of reality, time, and space Nature of human nature Nature of human activity Nature of human relationships Organizational Culture Levels Visible, often not decipherable Greater level of awareness Taken for granted Invisible Preconscious Reprinted with permission from Edgar H. Schein, Organizational Culture and Leadership: A Dynamic View. Copyright © 1985 Jossey-Bass Inc, asubsidiary of John Wiley & Sons, Inc.

Functions of Organizational Culture w Culture provides a sense of identity to members and

Functions of Organizational Culture w Culture provides a sense of identity to members and increases their commitment to the organization w Culture is a sense-making device for organization members w Culture reinforces the values in the organization w Culture serves as a control mechanism for shaping behavior

Theories about the relationship between organizational culture and performance Adaptive Perspective Strong Culture Perspective

Theories about the relationship between organizational culture and performance Adaptive Perspective Strong Culture Perspective Fit Perspective

An organizational culture with a consensus on the values that drive the company and

An organizational culture with a consensus on the values that drive the company and with an intensity that is recognizable even to outsiders Strong Culture Perspective Strong cultures facilitate performance because They are characterized by goal alignment • They create a high level of motivation because of shared values by the members • They provide control without the oppressive effects of bureaucracy •

Argument that a culture is good only if it fits the industry’s or the

Argument that a culture is good only if it fits the industry’s or the firm’s strategy. Fit Perspective Organizational characteristics that may affect culture § Customer requirements § Competitive environment § Societal expectations

An organizational culture that encourages confidence and risk taking among employees, has leadership that

An organizational culture that encourages confidence and risk taking among employees, has leadership that produces change, and focuses on the changing needs of customers Adaptive Perspective Nonadaptive Core Values Most managers care about customers, stockholders, and employees Most managers care about themselves, their work group, or an associated product Common Behavior Managers pay close attention to all their constituencies, esp. customers Managers tend to behave somewhat insularly, politically, and bureaucratically Reprinted with the permission of The Free Press, a Division of Simon & Schuster, Inc. from Corporate Culture and Performance by John P. Kotter and James L Heskett. Copyright © 1992 by Kotter Associates, Inc. and James L. Heskett.

Five Most Important Elements in Managing Culture w What leaders pay attention to w

Five Most Important Elements in Managing Culture w What leaders pay attention to w How leaders react to crises w How leaders behave w How leaders allocate rewards w How leaders hire and fire individuals

Organizational Socialization The process by which newcomers are transformed from outsiders to participating, effective

Organizational Socialization The process by which newcomers are transformed from outsiders to participating, effective members of the organization

1. Anticipatory Socialization Realism 2. Encounter 3. Change and Acquisition Outcomes of Socialization Stages

1. Anticipatory Socialization Realism 2. Encounter 3. Change and Acquisition Outcomes of Socialization Stages of Socialization From “An Ethical Weather Repart: Assessing the Organizaiton’s Ethical Climate” by John B. Cullen, et al. In Organizational Dynamics, Autumn 1989. Copyright © 1989 American Management Asociation International. Reprinted by permission of American Management Association International, New York, N. Y. All rights reserved. Http: //www. amanet. Org. Congruence Job demands • Task • Role • Interpersonal Mastery Performance Satisfaction Mutual influence Low levels of distress Intent to remain

1. Anticipatory Socialization - the first socialization stage--encompasses all of the learning that takes

1. Anticipatory Socialization - the first socialization stage--encompasses all of the learning that takes place prior to the newcomer’s first day on the job 2. Encounter - the second socialization stage-- the newcomer learns the tasks associated with the job, clarifies roles, and establishes new relationships at work 3. Change & Acquisition - the third socialization stage —the newcomer begins to master the demands of the job

Socialization as Cultural Communication Core values are transmitted to new organization members through n

Socialization as Cultural Communication Core values are transmitted to new organization members through n the role models they interact with n the training they receive n the behavior they observe being rewarded and punished

Assessing Organizational Culture w Organizational Culture Inventory focuses on behaviors that help employees fit

Assessing Organizational Culture w Organizational Culture Inventory focuses on behaviors that help employees fit into the organization & meet coworker expectations w Kilman-Saxton Culture-Gap Survey focuses on the expectations of others in the organization w Triangulation - the use of multiple methods to measure organizational culture

Situations That May Require Cultural Changes w Merger or acquisition w Employment of people

Situations That May Require Cultural Changes w Merger or acquisition w Employment of people from different countries Reasons That Change Is Difficult w Assumptions are often unconscious w Culture is deeply ingrained and behavioral norms and rewards are well learned

Hiring and socializing members who fit in with the new culture 4 3 Culture

Hiring and socializing members who fit in with the new culture 4 3 Culture Cultural communication Interventions for Changing Organizational Culture Removing members who reject the new culture Changing behavior 5 1 Examining justifications for changed behavior 2 Reprinted with permission from Vijay Sathe “How to Decipher & Change Corporate Culture, ” Copyright © 1985 Jossey-Bass Inc, Reprinted by permission Of Jossey-Bass, Inc. , a subsidiary of John Wiley & Sons, Inc. .

Cultural Modifications in the Current Business Environment Support for a global view of business

Cultural Modifications in the Current Business Environment Support for a global view of business Reinforcement of ethical behavior Empowerment of employees to excel in product and service quality

Support for a global view of business w Create a clear and simple mission

Support for a global view of business w Create a clear and simple mission statement w Create systems that ensure effective information flow w Create “matrix minds” among managers w Develop global career paths w Use cultural differences as major assets w Implement worldwide management education and team development programs

Reinforcement of ethical behavior w Clear communication of the boundaries of ethical conduct w

Reinforcement of ethical behavior w Clear communication of the boundaries of ethical conduct w Selection of employees who support the ethical culture w Reward of ethical behavior w Conspicuous punishment of members who engage in unethical behavior

Empowerment of employees to excel in product and service quality w Empowerment unleashes employees’

Empowerment of employees to excel in product and service quality w Empowerment unleashes employees’ creativity w Empowerment requires eliminating traditional hierarchical notions of power n Involve employees in decision making n Remove obstacles to their performance n Communicate the value of product and service quality