culture chapter slides

8/16/2019 Culture chapter slides

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Lecture 3Lecture 3

Organisational CultureOrganisational Culture


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Lecture objectives andLecture objectives and

OutlineOutline• The nature of organisational culture The nature of organisational culture

• Explain how culture is developed, reinforcedExplain how culture is developed, reinforced

and maintainedand maintained• The functions of culture The functions of culture

• mportance of a strateg!"culture #tmportance of a strateg!"culture #t

• $nderstand t$nderstand the role of culture inhe role of culture inorganisational changeorganisational change

• Current organi%ational culture issues facingCurrent organi%ational culture issues facingmanagersmanagers

2


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The organisational culture The organisational culture

• Our personalit! in&uences the wa!Our personalit! in&uences the wa!we act and interact with otherswe act and interact with others

• Organisational personalit!'Organisational personalit!' — — cultureculture


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(e#nition of organi%ational(e#nition of organi%ational

cultureculture

• culture is the commonl! held and relativel!culture is the commonl! held and relativel!stable beliefs, attitudes and values that existstable beliefs, attitudes and values that existwithin organi%ation)within organi%ation)

• * common perception held b! the organi%ation+s* common perception held b! the organi%ation+smembers a s!stem of shared meaning)members a s!stem of shared meaning)

• n summar!, organi%ational culture is ann summar!, organi%ational culture is anexpression of the values, beliefs andexpression of the values, beliefs and

assumptions that dominate the organi%ation) tassumptions that dominate the organi%ation) ttells emplo!ees what is important and what t!petells emplo!ees what is important and what t!peofof behaviorbehavior is expected)is expected)Culture in&uences the organi%ational behaviorCulture in&uences the organi%ational behavior


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(e#nition of(e#nition of OrganisationalOrganisational

CultureCulture

• The above de#nitions have following The above de#nitions have followingimplications-implications-

. Organisational culture is a perception based onOrganisational culture is a perception based on

what organisational members see, hear orwhat organisational members see, hear orexperience within the organisation)experience within the organisation)

. ndividuals within a organisation ma! have di/erentndividuals within a organisation ma! have di/erent

bac0grounds or wor0 at di/erent levels, the! tend tobac0grounds or wor0 at di/erent levels, the! tend to

describe culture in similar terms)describe culture in similar terms). Organisational culture is a descriptive term) tOrganisational culture is a descriptive term) t

concerns with how members perceive theconcerns with how members perceive the

organisation rather than whether the! li0e it)organisation rather than whether the! li0e it)


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1hat ma0es up an organi%ational1hat ma0es up an organi%ational

culture'culture'

• 2eliefs about how business ought to be2eliefs about how business ought to beconductedconducted

• alues 4 business principles of managementalues 4 business principles of management

• ““5ow we do things around here5ow we do things around here”” • O6cial policiesO6cial policies• Traditions Traditions• *pproaches to stoc0holder relationships*pproaches to stoc0holder relationships

• Compan! politicsCompan! politics• Often"told stories illustrating compan!Often"told stories illustrating compan!’’s valuess values• Ethical standardsEthical standards


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(imensions of Organisational(imensions of Organisational

CultureCulture

• 7esearch suggests there are seven7esearch suggests there are sevendimensions that capture the essencedimensions that capture the essence

of an organisationof an organisation’’s culture 8regards culture 8regardthem as seven organisationalthem as seven organisational

personalities9, each dimension existspersonalities9, each dimension exists

on a continuum from low to high)on a continuum from low to high)


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(imensions of Organisational(imensions of Organisational

CultureCulture

• *ttention to detail- degree to which*ttention to detail- degree to whichemplo!ees are expected to exhibit precision,emplo!ees are expected to exhibit precision,

anal!sis and attention to detail 8have madeanal!sis and attention to detail 8have made

:ualit! being compan!:ualit! being compan!’’s driving theme9s driving theme9

• Outcome orientation- degree to whichOutcome orientation- degree to which

managers focus on results or outcomesmanagers focus on results or outcomesrather than on how these outcomes arerather than on how these outcomes are

achieved 8ex- customer service9achieved 8ex- customer service9


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(imensions of Organisational Culture(imensions of Organisational Culture

8cont)98cont)9

• ;eople orientation- degree to which;eople orientation- degree to whichmanagement decisions ta0e into accountmanagement decisions ta0e into accountthe e/ects on people in the organisationthe e/ects on people in the organisation

• Team orientation- degree to which wor0 is Team orientation- degree to which wor0 isorganised around teams rather thanorganised around teams rather thanindividuals 8law #rms 9individuals 8law #rms 9

• *ggressiveness- degree to which emplo!ees*ggressiveness- degree to which emplo!eesare aggressive and competitive rather thanare aggressive and competitive rather thancooperative 8


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(imensions of Organisational Culture(imensions of Organisational Culture

8cont)98cont)9

• =tabilit!- degree to which organisational=tabilit!- degree to which organisationaldecisions and actions emphasisedecisions and actions emphasise

maintaining the status :uo, it emphasis onmaintaining the status :uo, it emphasis ongrowthgrowth

• nnovation and ris0 ta0ing- degree tonnovation and ris0 ta0ing- degree towhich emplo!ees are encouraged to bewhich emplo!ees are encouraged to beinnovative and to ta0e ris0sinnovative and to ta0e ris0s

Source: Robbins et al. 2005, Foundations of ana!e"ent, 1st edn., #rentice $all, %ustralia.


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How is an organisational cultureHow is an organisational culture

created?created?

• >ounder or earl! leader who articulated>ounder or earl! leader who articulatedbeliefs, principles, values, practicesbeliefs, principles, values, practices

• Over time, these values, principles,Over time, these values, principles,practices are shared widel! b! allpractices are shared widel! b! allemplo!eesemplo!ees

* compan! culture is a product of internal* compan! culture is a product of internalsocial forcessocial forces


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How is an organisational cultureHow is an organisational culture

maintained?maintained?

• Through the Through the process of selecting for employment process of selecting for employment ororpromotion those individuals who are best able topromotion those individuals who are best able tosustain or promote the prevailing culture)sustain or promote the prevailing culture)

• Through Through actions of top management actions of top management that constantl!that constantl!rea6rm and re&ect the culture to all emplo!ees)rea6rm and re&ect the culture to all emplo!ees)

• Through the action of the Through the action of the socialisationsocialisation process thatprocess thatdisseminates the culture among all the member ofdisseminates the culture among all the member of

the organisationthe organisation. $sing mentors, training programs and formal$sing mentors, training programs and formal

orientation sessionorientation session


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;rocess of creating and sustaining;rocess of creating and sustaining

cultureculture

#&iloso'&( ofor!ani)ation*s

founders

Selection

criteria

+o'

"ana!e"ent

Sociali)ation

r!ani)ational

culture

Source: Robbins et al. 1989


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How Employees Learn Culture:How Employees Learn Culture:

Manifestation of organisationalManifestation of organisational

CultureCultureCulture is transmitted to emplo!ees in a number ofCulture is transmitted to emplo!ees in a number of

wa!s-wa!s-

• SymbolsSymbolsObjects, acts, events or :ualities serving as aObjects, acts, events or :ualities serving as avehicle for conve!ing meaningvehicle for conve!ing meaning

• StoriesStories?arratives based on true events, which ma! be?arratives based on true events, which ma! be

embellished to highlight intended valueembellished to highlight intended value• Rites and CeremonialsRites and Ceremonials7elativel! elaborate, dramatic, planned sets of7elativel! elaborate, dramatic, planned sets ofactivities intended to conve! cultural values toactivities intended to conve! cultural values toparticipants and, usuall!, an audienceparticipants and, usuall!, an audience

=!stems of rites performed in conjunction with a=!stems of rites performed in conjunction with asingle occasion or eventsingle occasion or event


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How Employees Learn Culture:How Employees Learn Culture:

• LanguageLanguage- use language as a wa! to identif!- use language as a wa! to identif!members of a culture) $sing compan!members of a culture) $sing compan!’’s owns ownvocabular!, acron!ms and jargon)vocabular!, acron!ms and jargon)

>or example- n or example- n lat food- goodies from the vending machine that>lat food- goodies from the vending machine thatcan be slipped under the door to a colleague whocan be slipped under the door to a colleague whois wor0ing feverishl! on a deadlineis wor0ing feverishl! on a deadline

. >acemail- tal0 to someone face to face>acemail- tal0 to someone face to face


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1h! Culture matters'1h! Culture matters'

The functions of culture The functions of culture• Creates distinctions between oneCreates distinctions between one

organi%ation and anotherorgani%ation and another

• Conve!s a sense of identit! for membersConve!s a sense of identit! for membersof the organi%ationof the organi%ation

• >acilitates the generation of commitment>acilitates the generation of commitmentto something larger than oneto something larger than one’’s individuals individualself"interestself"interest

• Enhances the stabilit! of the organi%ation+sEnhances the stabilit! of the organi%ation+ssocial s!stemsocial s!stem

• ;rovides standards for what emplo!ees;rovides standards for what emplo!eesshould sa! and doshould sa! and do

• (e#nes the(e#nes the ‘‘rules of the gamerules of the game’’


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=trong Culture=trong Culture

• Organisations in which the 0e! values areOrganisations in which the 0e! values areintensel! held and widel! shared, have aintensel! held and widel! shared, have a

great in&uence on emplo!ees than do wea0great in&uence on emplo!ees than do wea0

cultures)cultures)

• The more emplo!ees accept the The more emplo!ees accept theorganisationorganisation’’s 0e! values and the greaters 0e! values and the greater

their commitment to those values, thetheir commitment to those values, the

stronger the culture is)stronger the culture is)• 7esearch shows that those companies with7esearch shows that those companies with

strong cultures have achieved highstrong cultures have achieved high

performance)performance) — — culture impacts on whatculture impacts on what

managers do as it becomes stronger)managers do as it becomes stronger)


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1ea0 Culture1ea0 Culture

• >ew values 4 beliefs widel! shared b!>ew values 4 beliefs widel! shared b!all emplo!ees and no strong sense ofall emplo!ees and no strong sense of

compan! identit!compan! identit!

Is strong culture good and weak cultureIs strong culture good and weak culture

bad?bad?

• 1hat is the disadvantage of a strong1hat is the disadvantage of a strongculture'culture'


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1h! culture matters'1h! culture matters'

mportance of a =trateg!"culturemportance of a =trateg!"culture

>it>it • Close match between culture 4 strateg! addsClose match between culture 4 strateg! adds

signi#cantl! to e/ectiveness of strateg!signi#cantl! to e/ectiveness of strateg!executionexecution

• 2eliefs, goals, 4 practices underpinning a2eliefs, goals, 4 practices underpinning astrateg! success ma! or ma! not be compatiblestrateg! success ma! or ma! not be compatiblewith compan! culturewith compan! culture. 1hen the! are not, culture ma! impede or even1hen the! are not, culture ma! impede or even

defeat successful implementationdefeat successful implementation

• =trong cultures=trong cultures. ;romote good performance when #t exists and;romote good performance when #t exists and

. 5urt performance when little #t exists5urt performance when little #t exists


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Organisation OpportunityOrganisation Opportunity

MatrixMatrix

• =uccessful organisations foster=uccessful organisations fosteradaptive, entrepreneurial culturesadaptive, entrepreneurial cultures

rather than administrative cultures)rather than administrative cultures)• The organisation opportunit! matrix The organisation opportunit! matrix

classif! #rms b! how much a #rmclassif! #rms b! how much a #rm’’ss

culture support a desire for changeculture support a desire for changeand a belief in its capacit! to in&uenceand a belief in its capacit! to in&uence

the competitive environment)the competitive environment)


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(imensions(imensions EntrepreneurialEntrepreneurialcharacteristicscharacteristics

*dministrative*dministrativecharacteristicscharacteristics

=trategic=trategic

(riven b! perceptions(riven b! perceptionsof opportunit!of opportunit! (riven b! controlled

(riven b! controlledorientation resourcesorientation resources

Commitment to sei%eCommitment to sei%eopportunitiesopportunities

7evolutionar! change7evolutionar! changein short periodin short period

Evolutionar! changeEvolutionar! changeover long periodover long period

Commitment ofCommitment ofresourcesresources


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Organisation opportunityOrganisation opportunitymatrixmatrix

yesyes adaptiveadaptiveentrepreneurialentrepreneurialorganisationorganisation

ComplacentComplacentthough successfulthough successfulmar0et leadersmar0et leaders

nono 7eactive planners7eactive planners 2ureaucratic and2ureaucratic and

lethargiclethargic

organisationorganisation

yesyesnono

esire for c!angeesire for c!ange

B

e l i e v e i n c a p a c i t y t o i n f l u e n c e

t

h e c o m p e t i t i v e

e n v i r o n m e n t


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Changing cultureChanging culture

• Changing culture to #t a newChanging culture to #t a newstrateg! is a tough executivestrateg! is a tough executive

challengechallenge. Especiall! when prevailing culture isEspeciall! when prevailing culture is

entrenched 4 unhealth!entrenched 4 unhealth!

• Senior executi"es mustSenior executi"es mustpersonally lead e#orts to createpersonally lead e#orts to createa strategy$supporti"e culture%a strategy$supporti"e culture%


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Culture Change


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1hen is cultural change most1hen is cultural change most

li0el! to ta0e place'li0el! to ta0e place'

• * dramatic crisis* dramatic crisis

• Turnover in leadership Turnover in leadership

• Dounger and smaller organi%ation Dounger and smaller organi%ation• 1ea0 culture1ea0 culture


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C!anging OrganisationalC!anging Organisational

CultureCulture2ecause the! involve fairl! stable values,2ecause the! involve fairl! stable values,beliefs and assumptions, organi%ationsbeliefs and assumptions, organi%ationscan be di6cult to change)can be di6cult to change)

*n approach to changing culture-*n approach to changing culture-• =urfacing actual norms=urfacing actual norms• *rticulating new directions*rticulating new directions

• Establishing new normsEstablishing new norms• dentif!ing culture gapsdentif!ing culture gaps• Closing culture gapsClosing culture gaps


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Leaders!ip & Culture C!angeLeaders!ip & Culture C!ange

•Crisis identi#cationCrisis identi#cation

•Communication of a new visionCommunication of a new vision•


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Current organisational cultureCurrent organisational culture

issues facing mangersissues facing mangers

• Creating an ethical cultureCreating an ethical culture• Creating an innovative cultureCreating an innovative culture• Creating a customer"responsive cultureCreating a customer"responsive culture• 1or0place spiritualit! and organisational1or0place spiritualit! and organisational

culturecultureThe recognition that people have inner life that nourishesThe recognition that people have inner life that nourishesand is nourished by meaningful work that takes place in theand is nourished by meaningful work that takes place in thecontext of community context of community

Strong sense of purposeStrong sense of purpose Focus on individual development Focus on individual development Trust and opennessTrust and openness Employee empowerment Employee empowerment Toleration of employee expressionToleration of employee expression

culture chapter slides

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