Chapter 5

Managing Organizational Culture and Change

Management Challenges

After reading this chapter, you should be able to:

Describe how organizational culture helps management achieve its objectives. Understand how cultural symbols, rites, ceremonies, heroes, and stories are used to sustain an organizations culture. Recognize the differences between strong and weak organizational cultures, and identify situations in which each of these cultures may be advantageous. Adapt to organizational change and the forces that drive change.
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Management Challenges (continued)

Identify the four different types of organizational cultures and the characteristics of people who fit best with each. Direct and counsel employees who resist organizational change. Apply the tactics of change agents while taking into consideration potential sources of resistance. Use tools that enhance our understanding of the change process, such as Lewins three-step model of change and force field analysis.
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Skills for managing organizational culture and change:

Cultural diagnostic skills

Cultural strategic skills

Managing culture skills

Change management skills

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Organizational Culture

A system of shared values, assumptions, beliefs, and norms that unite the members of an organization. Reflects employees views about the way things are done around here. The culture specific to each firm affects how employees feel and act and the type of employee hired and retained by the company.
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Levels of Corporate Culture

Visible Culture
Expressed Values

Core Values

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Functions performed by organizational culture:

Employee Self-Management
Sense

of shared identity Generation of commitment

Stability
Sense

of continuity Satisfies need for predictability, security, and comfort

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Functions performed by organizational culture: (continued)

Socialization
Internalizing

or taking organizational values as ones own

Implementation Support of the Organizations Strategy

If

strategy and culture reinforce each other, employees find it natural to be committed to the strategy

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Stages of the Socialization Process

Pre-arrival Encounter

Metamorphosis
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Creating and Sustaining Organizational Culture

Cultural Symbols Company Rituals and Ceremonies Company Heroes

Stories

Organizational Policies and Decision Making

Language Leadership
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Aspects of organizational culture

Cultural Uniformity versus Heterogeneity Strong versus Weak Cultures Culture versus Formalization National versus Organizational Culture Organizational Fit
Baseball

team culture Club culture Academy culture Fortress culture

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Managing Organizational Change

Organization culture can facilitate or inhibit change in an organization. A firm attempts to change organizational culture because the current culture hinders the attainment of corporate goals. Environmental and internal forces can stimulate the need for organization change.

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Forces for Change: Environmental Forces

Put pressure on how a firm conducts its business and its relationships with customers, suppliers, and employees. Environmental forces include:
Technology Market

forces Political and regulatory forces Social trends

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Forces for Change: Internal Forces

Come from decisions made within the company. May originate with top executives and managers and travel in a top-down direction. May originate with front-line employees or labor unions and travel in a bottom-up direction.

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Resistance to Change
Self-Interest Cultures that Value Tradition Different Perspectives and Goals Lack of Trust and Understanding Uncertainty

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Models of Organizational Change

Lewins three-step model

Force-field analysis model

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Lewins Three-Step Model of Organizational Change

Unfreezing

Change

Refreezing

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Force-field Model of Change

Desired state Restraining forces

Status quo

Driving forces Time

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Implementing Organizational Change

Top-down Change Change Agents

Bottom-up Change
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Change agents should take the following steps to obtain a successful change outcome:
1. Establish a sense of 5. Empower others to

urgency. 2. Form a powerful coalition of supporters of change. 3. Create a vision of change. 4. Communicate the vision of change.

act on the vision. 6. Plan and create shortterm wins. 7. Consolidate improvements and produce still more change. 8. Institutionalize new approaches.
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Tactics for Introducing Change

Communication and Education

Employee Involvement

Negotiation

Coercion
Top-Management Support
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Applications of Management Perspectives:

For the Manager

Certain types of changes routinely provoke strong employee resistance:

Changes

that affect skill requirements. Changes that represent economic or status loss. Changes that involve disruption of social relationships.

By being aware of the sources of resistance, managers can better apply tactics to make the changes more palatable for employees.
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Applications of Management Perspectives:

For Managing Teams

Teams can help test the waters for a proposed change. Various employee teams can serve as focus groups in order to find ways to make a change in policy more acceptable to employees.

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Applications of Management Perspectives:

For Individuals

Learning the specifics about the company culture can help you determine your fit with the organization and the possibility of succeeding. Ask questions and gather information during the recruiting process to get a handle on the company culture and assess whether you will function comfortably in it.
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