Business Leadership and Organizational BehaviorBusiness Leadership and Organizational Behavior

Organizational Culture

Craig W. Fontaine, Ph.D.

Organizational CultureOrganizational Culture

• An organization’s culture is a set of beliefs, values, and assumptions that an organization’s members share and use to guide their functioning

Organizational Culture (quotes)Organizational Culture (quotes)

• Shared view in existence long enough to be taken for granted by group members

• “Culture” is learned as a result of group experience and may be identified in a group or organization with a significant history

How Employees Learn CultureHow Employees Learn Culture

• Stories

• Rituals/Traditions

• Ceremonies

• Material Symbols

• Language

• Stories

• Rituals/Traditions

• Ceremonies

• Material Symbols

• Language

• Culture provides a sense of identity to members and increases their commitment to the organization

• Culture is a sense-making device for organization members

• Culture reinforces the values of the organization

• Culture serves as a control mechanism for shaping behavior

Functions of Organizational CultureFunctions of Organizational Culture

• Innovation

• People orientation

• Outcome orientation

• Easygoingness

• Detail Orientation

• Team Orientation

• Communication

• Training & development

• Rewards

• Decision making

• Risk-taking

• Management practices

Dimensions of Organizational CultureDimensions of Organizational Culture

Contrasting Organizational CulturesContrasting Organizational Cultures

Organization A 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.

• Support business strategy• Make staffing decisions• Set performance criteria• Guide style of interpersonal relationships• Select appropriate management style

Functions of Organizational CultureFunctions of Organizational Culture

Layers of Organizational CultureLayers of Organizational Culture

Artifacts of Organizational

Culture

Material SymbolsLanguage

RitualsStories

Organizational Culture

BeliefsValues

Assumptions

Artifacts – symbols of culture in the physical and social work environment

Espoused Values – what members of an organization say they value

Assumptions – deeply held beliefs that guide behavior and tell members of an organization how to perceive

and think about things

Enacted Values – reflected in the way individuals actually behave

Levels of Organizational CultureLevels of Organizational Culture

Reprinted with permission from Edgar H. Schein, Organizational Culture and Leadership: A Dynamic View. Copyright © 1985 Jossey-Bass Inc, a subsidiary of John Wiley & Sons, Inc.

Organizational Culture

Visible, often not decipherable

Greater levelof awareness

Taken for granted, Invisible, preconscious

Artifacts

Espoused Values

Assumptions

Enacted Values

© 2013 Cengage Learning

Variations in Organizational CultureVariations in Organizational Culture

Core Culture and Subcultures

Mini-cultures within an organization, typically defined by department designations and geographical separation.

Strong or Weak Culture

A culture in which the core values are intensely held and widely shared.

© 2013 Cengage Learning

• 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

Strong Cultures Improve Performance because…Strong Cultures Improve Performance because…

Negative Aspects of Organizational CultureNegative Aspects of Organizational Culture

1. Barrier to change.

2. Barrier to diversity

3. Barrier to acquisitions and mergers

1. Barrier to change.

2. Barrier to diversity

3. Barrier to acquisitions and mergers

Founding Organizational CultureFounding Organizational Culture

• The founders’ own behavior often acts as a role model that encourages employees to identify with them and thereby internalize their beliefs, values, and assumptions.

• Founders hire and keep only employees who think and feel the same way they do.

• Founders indoctrinate and socialize these employees to their way of thinking and feeling.

Maintaining Organizational CultureMaintaining Organizational Culture

• Selection• Concern with how well the candidates will fit

into the organization.• Provides information to candidates about the

organization.

• Top Management• Senior executives help establish behavioral

norms that are adopted by the organization.

• Socialization• The process that helps new employees adapt to

the organization’s culture.

A Socialization ModelA Socialization Model

Stages in the Socialization ProcessStages in the Socialization Process

Prearrival Stage

The period of learning in the socialization process that occurs before a new employee joins the organization.

Metamorphosis Stage

The stage in the socialization process in which a new employee changes and adjusts to the work, work group, and organization.

Encounter Stage

The stage in the socialization process in which a new employee sees what the organization is really like and confronts the possibility that expectations and reality may diverge.

How Organization Cultures FormHow Organization Cultures Form

How Organizational Cultures Have an Impact on Performance and Satisfaction

How Organizational Cultures Have an Impact on Performance and Satisfaction