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DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI
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DIAGNOSING ORGANISATIONAL CULTURE BY USING OCAI

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  • 1. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 ABSTRACT Organizational culture is a key source of competitive advantage. There is a demonstrated relation between organizational culture and organizational performance. This paper reviews research in the field and introduce a model for understanding, diagnosing and changing organizational culture. The main advantage of a new model is based on regarding culture as the management and work practices that are either hindering or helping an organization’s bottom line performance. Diagnosing Organizational Culture 1
  • 2. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 Table of Contents ABSTRACT............................................................................................................................................ 1 1.0 INTRODUCTION ............................................................................................................................ 3 2.0 Organizational Culture ............................................................................................................. 4 2.1 The Comparative Measurement of Organizational Cultures ............................................... 4 3.0 The Organizational Culture Assessment Instrument or OCAI ........................................... 5 3.1 The Clan Culture ................................................................................................................... 6 3.2 The Adhrocracy Culture ....................................................................................................... 6 3.3 The Market Culture ............................................................................................................... 6 3.4 The Hierarchy Culture .......................................................................................................... 7 CONCLUSION ...................................................................................................................................... 8 REFERENCES ...................................................................................................................................... 9 Diagnosing Organizational Culture 2
  • 3. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 1.0 INTRODUCTION Organizational culture is a key source of competitive advantage. Understanding, diagnosing and conducting interventions to change organizational culture will impact the overall performance. This paper reviews research in the field and introduce an organizational culture model to obtain insights and initiate interventions to increase performance. The paper begins by discussing the concept of organizational culture and the impact on organizational performance. Most organizational scholars and observers now recognize that organizational culture has a powerful effect on the performance and long-term effectiveness of organizations (Cameron and Ettington, 1998). This paper also briefly addresses the meaning of the term organizational culture. To understand how culture change can enhance organizational performance, it is important that we make clear what is and is not culture. All this establishes a groundwork for introducing framework of the core dimensions of organizational culture. Along with the framework, it introduce an instrument and a method for diagnosing and initiating cultural change. And also provide some examples of companies that have successfully implemented the methodology. Organizational Culture Assessment Instrument (OCAI) is used to diagnose organization’s culture. Although there are a variety of ways to assess organizational culture, this instrument has been found to be both useful and accurate in diagnosing important aspects of an organization’s underlying culture and it has been found to predict organizational performance. The model of the Competing Values Framework which consists of four Competing Values that correspond with four types of organizational culture. Diagnosing Organizational Culture 3
  • 4. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 2.0 Organizational Culture There is considerable agreement as to the general definition of organizational culture and most cultural models and diagnosis tools define culture as a system of shared values and beliefs that produce norms of behavior and establish an organizational way of life (Koberg & Chusmir, 1987, p.397). According to Schein’s (1981, 1985, 1992) theory, organizational culture is defined as a pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as a correct way to perceive, think and feel in relation to those problems. Schein considers culture to be a three layer phenomenon, they are artifacts and behaviors, espoused values, and assumptions. Artifacts are the most superficial manifestations of culture, and basic assumptions, the deepest layer of culture have been typically studied using qualitative approaches. Values and behavioral patterns have been measured using quantitative instruments. Organizational values refer to the principles which underlie patterns of behaviors and norms. Patterns of behaviors and norms have been defined as the way of thinking, behaving, and believing that members of a social unit have in common (Cooke and Rousseau, 1988). Compared to values, behavioral norms would be easier to learn and they could be readily influenced by the organization, through the management practices. Hofstede (1990)’s data shows that the different organizations within the same national culture could be distinguished from the behavioral norms (day-to-day practices) they differently adopt and not from their values. Because of their sensitivity to change and to inter-organizations variations, behavioral norms questionnaires produce information particularly useful for the purpose of intervention. 2.1 The Comparative Measurement of Organizational Cultures Organizational culture researchers have long debated whether cultures can be compared and measured. Some researchers have concluded that the deeper levels of culture such as symbolic meaning, semiotics, and underlying beliefs and assumptions are no subject to comparative analysis and are best understood through clinical or ethnographic methods (Schein, 1992; Van Maanen, 1988). Whereas other culture researchers, while acknowledging the limitations of comparative research for understanding the deeper levels of culture, have persisted in the development of systematic approaches to comparative measurement. Diagnosing Organizational Culture 4
  • 5. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 Another approach is based on the Competing Values Framework for cultural assessment distilled by Quinn and Rorbaugh (1983) from analysis of Campbell’s longer list into a four dimensional pattern such as clan, adhocracy, hierarchy and market. 3.0 The Organizational Culture Assessment Instrument or OCAI The Organizational Culture Assessment Instrument (OCAI) is a tool for diagnosing organizational culture, developed by Professors Robert Quinn and Kim Cameron. OCAI is a validated instrument, based on the Competing Values Framework, and used by thousands of companies worldwide (www.ocai-online.com). . OCAI offers quick, identifiable diagnosis with a visual profile. The model of the Competing Values Framework which consists of four Competing Values that correspond with four types of organizational culture. Every organization has its own combination of these four types of organizational cultures (clan, adhocracy, hierarchy and market). Test takers assess six key characteristics of their corporate culture, they are dominant characteristics, organizational leadership, management of employees, organization glue, strategic emphasis and criteria of success (Cameron and Quinn, 1999). Flexibility & discretion Clan Adhocracy Internal Focus & Integration External Focus & Diferentiation Hierarchy Market Stability & control Diagnosing Organizational Culture 5
  • 6. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] 3.1 January 8, 2014 The Clan Culture This working environment is a very pleasant place to work, where people share a lot of personal information, much like an extended family (www.ocai-online.com). The leaders or heads of the organization are seen as mentors and perhaps even parent figures. The organization is held together by loyalty or tradition. The organization emphasizes the longterm benefit of human resources development and attaches great importance to cohesion and morale. Success is defined in terms of sensitivity to customers and concern for people. The organization places a premium on teamwork, participation, and consensus. The example of a clan-type organization in the United States was People Express Airlines in its first five years of operation until its founder, Don Burr, encountered financial difficulties that led him to sell the company to avoid bankruptcy. Burr brought with him several other officials from Texas Air and within two years has defied all experts’ predictions by turning a profit. It is the most dramatic study of the history of the airline industry. 3.2 The Adhrocracy Culture A dynamic, entrepreneurial, and creative place to work. People stick out their necks and take risks. The leaders are considered innovators and risk takers. The glue that holds the organization together is commitment to experimentation and innovation (Cameron, K. & Quin, R., 1999). The emphasis is on being on the leading edge. The organization’s long term emphasis is on growth and acquiring new resources. Success means gaining unique and new products or services. Being a product or service leader is important and the organization encourages individual initiative and freedom (http://ocai.wordpress.com). Sometimes adhocracy subunit culture existing within a hierarchy was described in the study that occurred in the Department of Mental Hygiene in the state government of New York (Quinn and Cameron, 1983). In its first five years of existence, the department was organized as an adhocracy. 3.3 The Market Culture A result-oriented organization whose major concern is getting the job done. People are competitive and goal-oriented. The leaders are hard drivers, producers, and competitors. They are tough and demanding. The glue that holds the organization together is an emphasis on winning. Reputation and success are common concerns. The long-term focus is on competitive actions and the achievement of measurable goals and targets. Success is defined in terms of market share and penetration. Competitive pricing and market leadership are important. The organizational style is hard-driving competitiveness. The General Electric Diagnosing Organizational Culture 6
  • 7. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 culture under Jack Welch was known as a highly competitive, results, take no prisoners type of culture. It reflected a stereotypical market culture (Quinn and Cameron, 1983). 3.4 The Hierarchy Culture A very formalized and structured place to work. Procedures govern what people do. The leaders pride themselves on being good coordinators and organizers who are efficiencyminded. Maintaining a smooth-running organization is most critical. Formal rules and policies hold the organization together. The long-term concern is stability and performance with efficient and smooth operations. Success is defined in terms of dependable delivery, smooth scheduling and low cost. The management of employee is concerned with secure employment and predictability. Organizations ranging from a typical U.S. fast-food restaurant such as McDonald’s to major conglomerates like Ford Motor Company and government agencies such as Justice Department provide prototypical examples of a hierarchical culture (Quinn and Cameron, 1983). A quantitative starting point completed with qualitative information, consensus about current and preferred culture, the momentum for change, and basic for the successful and sustainable change. The OCAI way: 21st Century Change, engaging and inclusive. The problem with organizational culture change is about 70% fails because it does not fit into the current culture and it is ordered in a command and control way and causes resistance. The things is we cannot change others. We have to change collectively to make a real, sustainable change as an organization. There are some reasons why use the OCAI for diagnosing culture in organizations. First, it gives a validated and quantified image of overall culture as a starting point for change. Second, it is timely and focused. It measured six key aspects that make a difference for success, and both assessment and change strategy can be done quickly. Third, it is involved as it is easy to include all the personnel and gives an idea of employee satisfaction, based on discrepancies between current and preferred culture. Fourth, it is manageable with a step-bystep method for change and it supplies a clear vision on the preferred culture that can be adapted to become a road map for change, that will mobilize the organization to sustainable change (www.ocai-online.com). Diagnosing Organizational Culture 7
  • 8. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 CONCLUSION Research shows a powerful effect on the performance and long-term effectiveness of organizations. Culture comprises the collective assumptions and it determines behavior, performance and turnover, customer satisfaction and reputation, market share and competitiveness. The Organization Culture Assessment Instrument (OCAI) is an instrurment that allows us to diagnose the dominant orientation of the organization based on these core culture types. Two major polarities of values were found to determine organization’s effectiveness. By rating six key aspects of organizational culture that were found to determine success, the respondent assesses the current and preferred organizational culture. The outcome is based on Competing Values Framework and consists of four culture types that are clan culture, adhocracy culture, market culture and hierarchy culture. And because the world is changing rapidly, most organizations have to adapt to survive and succeed. Sustainable change is possible when executives and employees change their working culture and behavior and thus their results. Diagnosing Organizational Culture 8
  • 9. [BUHRM 3701- MANAGEMENT OF CHANGE AND ORGANIZATIONAL DEVELOPMENT] January 8, 2014 REFERENCES Cameron, K. S., Quinn, R. E. 1999. Diagnosing and changing organizational culture: Based on the competing values framework. Reading, MA: Addison-Wesley. Cooke, R. A., Lafferty, J. C. 1989. Organizational Culture Inventory, Plymouth: Human Synergistics. Hofstede, G., Neuijen, B., Ohayv, D. D., Sanders, G. 1990. Measuring organizational cultures: A qualitative and quantitative study across twenty cases. Administrative Science Quarterly, 35, 286-316. Koberg, C. S., & Chusmir, L. H. 1987. Organizational culture relationships with creativity and other job-related variables. Journal of Business Research, 15, 397-409. Quinn, R. E., Rohrbaugh, J. 1983. A spatial model of effectiveness criteria: Towards a competing values approach to organizational analysis. Management Science, 29, 363-377. Quinn, Robert E., and Cameron, Kim S. “Organizational Life Cycles and Shifting Criteria of Effectiveness.” Management Science, 1983, 29, 33–51. Schein, E. 1992. Organizational culture and leadership. San Fransisco, CA: Jossey-Bass. From Internet: Bremer, M. 2010. Organizational Culture Assessment Instrument (OCAI) explained. Retrieved January 7, 2014, from, http://www.ocai-online.com/about-theOrganizational-Culture-Assessment-Instrument-OCAI Diagnosing Organizational Culture 9

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