CHAPTER 7 ORGANIZATIONAL CULTURE

Click to edit Master subtitle style

PREPARED BY : NORHASLINDA BINTI MOHD ROSLIN IZREEN FARA BINTI MD RAZALI

4/29/12

CHAPTER OBJECTIVES
Understand the concept of organizational

culture culture

Identify the determinants of organizational Recognize effective organizational culture

management

4/29/12

CONCEPT OF ORGANIZATIONAL CULTURE

4/29/12

WHAT IS ORGANIZATIONAL CULTURE? A system of shared actions, values, and beliefs that develop within an organization and guides the behavior of its members.

4/29/12

WHY IT IS IMPORTANT TO HAVE CULTURE IN AN ORGANIZATION?

It creates distinctions between one organization and others

1.

1.

It conveys a sense of identity for organizations members

1.

It facilitates commitment rather than ones individual self-interest 4/29/12

4/29/12

External adaption - Deals with reaching goals, the tasks to be accomplished, methods used to achieve goals and method used of coping success and failure.
v OC function through shared experiences,

members of the organization may develop common views as guidance to their day-to-day activities
4/29/12

Internal integration - Deals with the creation of a collective identity and with ways of working and living together
v OC function through dialogues and

interaction, members of the organization begin to characterize their environment and background
4/29/12

SUBCULTURE VS COUNTERCULTURE
SUBCULTURE : Groups of individuals that have their own values and philosophy that is not consistent with the organizations dominant values and philosophy

Example : In the Boeing Renton, there are strong stress engineers and liaison engineers that specialized in solving knotty technical issue to ensure the Boeing planes are safe. However, these groups of engineers also share in the dominant values of Boeing. 4/29/12

COUNTERCULTURE: Groups of individuals where the SUBCULTUREand philosophy reacts against the patterns of values VS COUNTERCULTURE larger organization or social system

Example : The punk movement of the seventies and early eighties sought to be anti-establishment and anti-capitalist.

4/29/12

 NATIONAL CULTURE : Is the nation shared values,

NATIONAL CULTURE VS CORPORATE CULTURE

preferences, and behaviors of population groups in a given country.

CORPORATE CULTURE : Is the shared actions, values,

and beliefs that develop within an organization.

DIFFERENCES : According to Hofstede, differences

between national cultures are mainly found in the 4/29/12 VALUES of the different cultures, whereas

LAYERS OF CULTURAL ANALYSIS

4/29/12

OBSERVABLE CULTURE : The way things are done in the organization can be sees, hears and feels

4/29/12

Saga is an embellished heroic account of the story of the founding of an organization. Rite and Rituals : Rites are standardized and recurring activities that are used at special times to influence the behaviors and understanding of organizational members whereas the rituals are the system of the rites.

Example : In a Japanese company, they usually start

their workdays together with group exercises.

4/29/12

Cultural symbol is any object, act, or event that serves to transmit cultural meaning.

Example : The corporate uniform worn by Pos

Laju delivery personnel.

Cultural Rules and Roles are the part of normative controls of the organization and appear from its daily routine such as the presentation and methods of communicating 4/29/12

Shared Values: Linking people together and can provide a powerful motivational mechanism for members

Shared Values and Meanings: help turn routine activities into valuable and important actions. This mean by what tasks a person performs not only workable but must be correct, right and important.
However, not all members agree with the shared values but they have been exposed to and often told that they are important.
4/29/12

COMMON ASSUMPTION : Are the taken-forgranted truths that collections of corporate members share as a result of their joint experience. Myths is a commonly held cause effect Organizational

relationship or assertion by senior management that cannot be supported empirically because they are unproven and often unstated beliefs that are accepted uncritically. Myth can be real or imaginary, might not have ever happened but it could have happened, can be positive or negative. However, this myth can help people make sense of their world.
4/29/12

Example : The senior managers of Cisco systems often

DETERMINANTS OF ORGANIZATIONAL CULTURE

4/29/12

Determinants are the factors that influence organizational culture

4/29/12

Managing Organizational Culture

4/29/12

4/29/12

Managing Organizational Culture

4/29/12

Management Philosophy
Definition:
Links key goal-related strategic issues with key

collaboration issues and come up with a series of general ways by which the firm will manage its affairs.
Set of common values or ideas espoused by

members of organization about best management practices.

Way top-management addresses the question of

external adaptation.
4/29/12 Well-developed Management Philosophy is

Building, Reinforcing and

Changing Culture
Modify visible aspect of culture directly:

language, stories, rites, rituals and sagas.

Change lesson drawn from common stories and

encourage individuals to see the reality that they see.

Create new rites and rituals.

Foster culture that have balance emphasis on:

Overcome external adaptation and internal

integration
Linkages between corporate culture and finance

performance

4/29/12

Stockholders or customer associated with long-term

 One of the key ways management influence

culture, by establishing reward systems.

Match overall strategy of the firm and reinforce the

culture emerging from day-to-days activities.

2 patterns of reward systems, strategies and

corporate culture which are common, they are:

Hierarchy-based rewards Performance-based rewards
4/29/12

Reward System Strategy Corporate culture

Hierarchy-based reward Performance-based system reward system Steady-state strategy Clan culture: Long-term commitment Fraternal r/ship Mutual interests Collegiality with heavy pressures to conform from peers Superiors acting as mentors Evolution and change strategy Market culture: Contractual link between employee and employer Focused on short-term performance Stressed individual initiative with very little pressure from peers to conform Supervisors acting as resource allocators

Industry Type Power generation, Restaurants, consumer chemicals, mining and products, industrial 4/29/12 pharmaceuticals industry services.

 Direct attempts by senior management to alter

values and assumptions of individuals by resocializing.

Re-socializing: change their heart so that their mind

and actions would follow with goals to establish a clear, consistent organization-wide consensus.

Results: Impossible and Undesirable approach. This is because, changing peoples value from top

down without changing how the organization operates and recognizes the importance of individuals does not work very well.
Revitalize an organization by dictating major

changes and ignoring shared values.

Results: Although things may change a4/29/12 the bit on

surface, a deeper look often show resisting change and

References
1. Schermerhorn, J.R., Hunt, J.G., and

Osborn, R.N. (2005). Organizational Behavior (11th Edition). New York: John Wiley & Sons, Inc. corporate culture through reward systems. Academy of Management Executive, 19(4), 131-138.

2. Kerr, J. & Slocum, J.W. (2005). Managing

3. Willcoxson, L. & Millett, B. (2000). The

Management of Organizational Culture. Australian Journal of Management & Organisational Behaviour, 3(2), 91-99. 4/29/12

Click icon to add picture

Thank you for your attention Q&A SESSION

4/29/12