The relationship between

Organizational :

culture
climate
&
managerial values
 AUTHORS
Joseph Wallace

Monash Mt Eliza Business School, Monash

University,
Victoria, Australia

James Hunt

School of Business, University of Newcastle, New

South Wales,Australia

Christopher Richards

The Boston Consulting Group, Sydney, New

South Wales, Australia
 CONCEPT

Culture is the totality of beliefs, customs

,traditions & values shared by the members of
the organisation
 Introduction-Organisational culture

All organisations consist of both formal and

informal dimensions, and that it is simply not
possible to know or understand the workings of an
organisation without a sound understanding of its
informal character. (Blau and Scott, 1962 first post-war
management authors )

First major analysis of the informal dimension,

focusing on organisational culture and
management, gained attention in the mainstream
literature of organisational theory (Peters, 1978).
Organisational cultures consist of cognitive systems
explaining how people think, reason, and make
decisions (Pettigrew (1979),
 Introduction-Organisational culture

Emerging interest in understanding the cultural

factors underpinning Japanese economic
performance (1970s and early 1980s).

Popular business books which readily

synthesized the ideas of Pettigrew into an
accessible form for practitioners of the time.
The Art of Japanese Management (Pascale and Athos,
1981)
Corporate Culture (Deal and Kennedy,1982)
In Search of Excellence (Peters and Waterman, 1982)

All provided timely accounts of the

competitive advantage of organisations with
deeply embedded shared values.
 Introduction-Organisational culture
Emphasised - organisations may have a number of
different and competing cultures & individual
organisational sub-units are likely to develop
distinctive ideologies and structures of meaning
(Pfeffer, 1981).

Organisational success - emphasised the importance

of shared values and belief systems in harnessing the
loyalty and influencing the behaviour of
organisational members.
( Authers Knights and Willmott, 1987; Barley et al., 1988;
Sackmann, 1991)

Academic accounts are primarily concerned with

understanding culture in organisations, while
practitioner accounts are frequently concerned with
control and prediction. (Sackmann noted (1991)
 Introduction-Organisational culture

Conceived culture as a construct which

manifests itself in an organisation as a result
of the organisation's location within a
particular society.
On the basis of an extensive analysis of
88,000 responses to a questionnaire survey of
IBM employees in 66 countries (Hofstede (1980)

Hofstede argued that there are four discrete

dimensions of culture:
Individualism
Uncertainty avoidance
Power distance
Masculinity
13
 What is Organizational Climate?

Refers to meaningful interpretations of a work

environment by the people in it
Are social relationships warm and caring?
Are people treated fairly for rewards/recognition?
Do people take pride in excellence?

Organizational Climate is often referred to as

Corporate Climate

14
 ORIGIN OF CLIMATE

Managerial Employee
Employee
Policies performance
charecteristics

Organisational
ORGANISATIONAL
structure
CLIMATE
Technology

External
Environment
DIMENSIONS OF CLIMATE
Specifically, Jones and James derived six
dimensions of climate:
Leadership facilitation and support;
Workgroup co-operation, friendliness and
warmth;
Conflict and ambiguity;
Professional and organisational esprit;
Job challenge, importance and variety; and
Mutual trust (Jones and James, 1979).
 Organizational Culture Vs
Org.Climate
ORGANIZATIONAL ORGANIZATIONAL
CULTURE CLIMATE
Based on anthropology and Based on psychology
sociology

Members learn and It does not deal with values

communicate what is & norms, it is concerned
acceptable or unacceptable with the current
in the organization atmosphere in the
organization.

It is long lasting It is developed through the

managerial prescriptions
Culture and values
 Culture and values
Values lie at the heart of Hofstede's (1980) model of
the component parts of culture.

Values are described by Hofstede as consisting of

non-specific feelings of good and evil, beauty and
ugliness, normality and abnormality, rationality and
irrationality

Values themselves cannot be observed directly, but

can be inferred from their manifestations in
alternatives of behaviour.

Sackmann (1991) uses the analogy of an iceberg to

differentiate between the visible aspects of culture,
observed behavioural regularities (the tip of the
iceberg), and the central cognitive components of
culture; values and beliefs (the underlaying bulk of
 Culture and values
Research into values by Posner and Schmidt
(1992) differentiates between personal and
organisational values.

Hofstede (1989) makes a similar distinction by

differentiating between the value components
of culture at the occupational, organisational
and national levels.

These different value sub-sets illuminate areas

of value resemblance, in which individual
values coincide with values held by others at
either the organisational or national level.
Core stands for the values of a
certain culture

Hoftedes Onion Model

Comprehensive set of 12 discrete
organisational values

(1) power (7) fairness

(2) elitism (8) teamwork
(3) reward (9) law and order
(4) effectiveness (10) defence
(5) efficiency (11) competitiveness;
(6) economy and
(12) opportunity.

Flowers and Hughes (1978), Ali and Al-Shakis

(1985), Davis and Rasool (1988),Woodcock
and Francis (1989), and Huo and Randall
 Relation between culture, climate and values

Though closely related to culture, organizational climate holds

several important differences.
Climate is held to be a summery perception of how an
organization deals with its members and environments, and thus
develops specifically from internal factors primarily under
managerial influence.
Organisational culture, by contrast, is created from a board
range of internal and external influences, some of which have been
argued to lie beyond managerial control.
Demographic factors such as: age; sex; length of service; and
educational attainment, together with individual skills, attitudes
and personality dimensions as a key intervening variables in the
determination of managerial values . Continue
Relation between culture, climate and values

These sets of correlates (culture, climate and managerial

values) are instrumental in predicting levels if
managerial and organisational effectiveness in both
public and private sector institutions.
Evidence points to values as integral elements of culture.

Climate and culture are not entirely discrete constructs .

These sets of correlates are inter-related in some way, and

consequently this issue is worthy of empirical
investigation.
 Research Questions ?

The purpose of the current study was to measure the culture, climate
and managerial values of large Australian public sector organisation;
the Victoria Police

A comparison of the cultural scores from this investigation with

Hofstedes original findings on Australia, and an investigation of the
inter-relationships linkage between culture, climate and values were
intended as exploratory procedures .

Two research questions:

(1) What are the cultural, climate and managerial values of the Victoria
Police?

(2) Are these three sets of variables-cultural, climate, values-interrelated

?
 Method
A four-part questionnaire was developed.
The five highest loading variables defining each one of the four cultural
dimensions in his factor analysis were chosen as appropriate culture items. Six
components were incorporated as measures of organizational climate .
12 dimensions were extracted and used as indicators of managerial values for
the analysis.
Some bibliographical and related questions were incorporated as potential
moderating variables.
This process resulted in the development of a 64-item questionnaire, using an
anchored Likert-type scale attached to each item

The questionnaire was forwarded to a representative sample of 300 male and

female officers of varying ranks in the 10,000 personnel strong Victoria Police
Force.

A total of 203 questionnaires were retained for analysis, yielding a 67 per cent
response rate
Data were subsequently analyzed through SPSS procedures.
 Results
Q1. What are the cultural, climate and managerial value levels of
the Victoria Police?

Of the 12 value dimensions, only one (reward) emerges with a relatively low score.
This suggests that employees within this organisation do not believe that managers
place emphasis on linking rewards to performance.

Conversely, four dimensions have relatively high index values, these are:
Power;
Efficiency;
Fairness; and
Law and order.

The first two of these give a clear indication of the bureaucratic nature of the
organisation in question.
Q2. Are these three sets of variables - culture, climate, managerial
values interrelated?

A potential link between culture, climate and values.

More specifically conflict and ambiguity within the organisation
increases with greater power distance and uncertainty avoidance.
Mutual trust increases with respect to power distance, but there is a
negative relationship between power distance and teamwork.
Demographic relationships are not surprising, given the traditional
nature and hierarchy of police organisations.
Relationships between organisational climate and values are more
pronounced and extensive.
A strong relationship between these two constructs.
 Discussion
Thought-provoking points individualism is considerably lower than that
recorded for the national level.
This is indicative of police organisations in Australia where culture
produces great emphasis on teamwork and mutuality, and where
acceptance of authority and conformity are the norm.
Question 1.
In relation to the organisational climate an organisation where work is
interesting and challenging, and where teamwork, brotherhood and
``mateship'' are highly valued and positively encouraged. The results here
are indicative of a positive climate in terms of work and working
relationships generally within this
organisation.
 Discussion
Managerial values investigated in this study, the low score for reward and a
lack of emphasis on linking rewards to performance within this organisation

This is likely to have an effect on levels of motivation and job satisfaction

among achievement-oriented individuals within the Victoria Police Force

Expectations about issues relating to the values of power and efficiency were
sustained. These relatively high scores are indicative of an organisation
portraying a number of typical bureaucratic characteristics.

 These include a strong role-based culture, heavy emphasis on adhering

to established rules, regulations and procedures, a strong focus on
efficiency, and the concentration of power at the strategic apex.

There are strong perceptions of fairness with regard to how rules are
applied to and enforced upon organisational members.

Question 2.
Analysis clearly points to potential linkages between the three sets of
variables, although the precise nature and direction of these linkages
cannot be unequivocally articulated at this stage.

 Culture, organisational climate, and managerial values are

related but the causal directions are largely not presumed.

There is a strong link between organisational climate and

managerial values, is well supported in the literaJture.

A similar assumption could be made regarding the relationship

between managerial values and behavior.

 Conclusion
This study has mapped out the cultural, climate and managerial values existing in the Victoria
Police organisation

Providing valuable evidence and posing some challenges for management in the rapidly
changing environment of policing within Australia

Second, from the exploratory correlation analysis, sufficient evidence now emerges to deduce
that inter-relationships between culture, climate and managerial values do exist, and that with
the inclusion of the additional dimension of managerial behaviour.

These inter-relationships and linkages should be more formally and accurately assessed in a new
research endeavour aimed at developing a predictive model of these important constructs and
concepts
.
 Conclusion

Hypothesised model of the relationship between culture, organisational

climate, managerial values and behaviour.
 Communication:Employees are restricted
to formal hierarchy or authority
Outcome orientation:Management focuses
on results rather than the techniques
People orientation:Management tend to
focus on employee needs & demands
 IMPLICATIONS OR
PROCESS/MAINTAINING CULTURE
Selection of employees
Actions of top management
Socialization
 Selection of employees
Careful selection-right person at the right
job
Interviewer should be trained enough to
value for company culture
Selecting only those who match with the
culture
 Actions of top management
Culture is depending on them
Their ideas are to be expressed through
culture
It make them understand how much
a) Risk can be taken for
b) Freedom should be given to subordinates
c) Wages or promotions or rewards should
be raised
 Socialization

The adaptation of culture by the new

entrants is called socialization
Important to make people aware about
culture
The process refers
a) Pre-arrival Stage :
b) Encounter Stage :
c) Metamorphosis or Transformation Stage:
 Pre-arrival Stage
Some learning is done before a new
entrants join the enterprise
They may have set of values,beliefs &
expectations
Candidates should be made aware about
company norms & values
 Encounter Stage:
After joining,he may face Reality
shock,may be satisfied or not
He may find gap between his
expectations with organisational
expectation
He requires orientation to overcome the
problem
 Metamorphosis or Transformation Stage:
Real change in the employee takes place
He adjusts to his work group values,norms
He starts to enjoy new company culture
If he is not able to adapt new culture,it
results lack of commitment & low
productivity & even turnover also
 SOCIALISATION PROCESS

Pre-arrival Encounter Transformation

Productivity Commitment Turnover

 ORGANISATIONAL CLIMATE

Set of charecteristics that describe

an organisation & distinguishes
one from another & influences the
behaviour of people in
organisation
Climate may be thought of as the perception
of the characteristics of an organisation
-Joe Kelly
 NATURE
Abstract & intangible concept
Perceived aspect of internal culture
Offers a distinct identity
Total expression of what the organisation
is
It remains stable over time
Its a multi-dimensional concept
 NEED OF A CULTURE
Influences satisfaction & performance
through change in behaviour
Influences attitude through evaluation of
self & others
Places constraints upon individual freedom
of choice & decision making
 ELEMENTS OF ORGANISATIONAL
CLIMATE
Individual autonomy:The degree of
responsibility,freedom that individuals
have in the organisation
Structure:The degree to which
organisation creates clear
objectives,performance expectations &
authority relationship
Reward system:Reward system is based on
performance rather than seniority
 Job satisfaction:Degree of happiness if jobs
are designed that allow to implement
workers creativity
Morale:High morale lead to atmosphere of
cooperation whereas low morale leads to
low productivity
Control:Control system may be either rigid
or flexible that create formal or informal
structure
 FACTORS INFLUENCING
ORGANISATIONAL CULTURE

Organisational context:Mission,goals,objectives,
functions etc
Organisational structure:Size,degree of
centralisation,operating procedure
Leadership process:Style,communication
decision making & related process
Physical environment::Employee safety,stress
etc
Values & norms:Conformity,loyalty,impersonality
etc
 ORIGIN OF CLIMATE

Managerial Employee
Employee
Policies performance
charecteristics

Organisational
ORGANISATIONAL
structure
CLIMATE
Technology

External
Environment