Organizational Culture

Organizational Culture is the totality of beliefs , customs, traditions and values shared by the members of the organization.
Corporate culture can be looked at as a system.
It is important to consider culture while managing change in the organization.
Culture can be both, as input and as output.
Introduction

Innovation and Risk Taking
Attention to Detail
Outcome Orientation
People Orientation
Team Orientation
Aggressiveness
Stability
Key Characteristics of Corporate Culture

Authoritarian culture
Participative culture
Mechanistic culture
Organic culture
Sub-cultures and Dominant culture
Types of Culture

Academy culture
Baseball Team culture
Club culture
Fortress culture
As given by Jeffrey Sonnenfeld

Talent-attractor
Talent-retainer
Engages people
Creates energy and momentum
Changes the view of “work”
Creates greater synergy
Makes everyone more successful
Importance of Organizational Culture

Product of action, i.e., input.
Element of future action, i.e., output.
Culture is the product of socio-technical systems.
Management strategies, structures, procedures, etc. influence culture.
Culture can be self-perpetuating and highly resistant to change.
Culture – Input and Output

Adapted from Williams et al, 1989
The Organization
External Environment

Legislation
Politics
Technology
Education
Society
Market place
Competitors
Consumers
Economy

strategy
Structure, systems, technology
Work Environment
Work tasks, goals and procedures
Work group behavior
Manager behavior
Culture: common beliefs, values and attitudes
Characteristic patterns of behavior

National cultural values are learned early, held deeply and change slowly over the course of generations.
Organizational culture, on the other hand, is comprised of broad guidelines which are rooted in organizational practices.
A nation’s culture is similar to that of an organization as it is comprised of the symbols, values, rituals, and traditions of the people living in a particular region.
Cultures usually differ in relationships between the individual and society, ways of dealing with conflict, relationships to authority, and conceptions of class and gender. All of these things are comparable to organizational culture, just on a grander scale.
Organizational Culture v/s National Culture

Creating and Sustaining Organizational Culture

The ultimate source of an organization’s culture is its founders.
Culture creation occurs in three ways:
Employees hire and keep employees with same thinking
They indoctrinate and socialize the employees with the organization’s thinking
The founder’s behavior acts as a role model for the employees
With the organizational success, the founder’s personality is embedded in the organizational culture.
Creating Corporate Culture

How Organization Cultures Form
Robbins, 1989

Three forces play a particularly important part in sustaining a culture:

Selection practices
Actions of top management
Socialization methods

Sustaining Organizational Culture

Explicit goal – identifying and hiring individuals having knowledge, skills and abilities to perform the jobs successfully.
Individuals having values consistent with those of the organization are selected as per the decision maker’s judgements.
Selection becomes a ‘two-way street’ as it provides information about the organization to the applicants.
Selection

The actions of top management establishes the norms for the organization as to:

Whether risk taking is desirable
How much freedom managers should give to their subordinates
What actions will pay off in terms of pay rises, promotions and other rewards, etc.

Top Management

New employees are not familiar with the organizational culture and are potentially likely to disturb the existing culture.
The process through which the employees are proselytized about the customs and traditions of the organization is known as socialization.
It is the process of adaptation by which new employees are to understand the basic values and norms for becoming ‘accepted’ members of the organization.
Socialization

Socialization is a process made up of three stages:
Pre-arrival - All the learning occurring before a new member joins.
Encounter - The new employee sees what the organization is really like and confronts the possibility that expectations and reality may diverge.
Metamorphosis - The relatively long-lasting changes take place. The new employee masters the skills required for the job, successfully performs the new roles, and makes the adjustments to the work group’s values and norms.
Socialization Process

Socialization Model

Stories – Depicting the past events of the organization. Some organizations actually try to manage this element of culture learning.
Rituals – Repetitive sequential activities reinforcing the values of the organization.
Material Symbols – Conveying social equality, desired organizational behavior, etc. by the top management.
Language – Acceptance and preservation of culture.
How Employees Learn Culture

Culture adapts to diverse circumstances.
Managers need to understand the nature and role of culture.
Managers must understand the importance of culture for organizational change.
Corporate culture also impacts the day-to-day decision-making of the organization.
Conclusion