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Organizational culture and ethical behavior

Organizational Culture And Ethical Behavior

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Organizational culture and ethical behavior

  1. 1. Organizational Culture And Ethical Behavior Dr. G C Mohanta, BE, MSc(Engg), MBA, PhD(Mgt) Professor
  2. 2. Organizational Culture  The shared values, principles, traditions and ways of doing things that influence the way organizational members act.  The shared values, ways of thinking, attitudes and guiding beliefs relevant to and supportive of the organization and its goals.  The characteristic set of values and ways of behaving that employees in an organization share.  A common perception held by the organization’s members
  3. 3. Patterns of Behavior, Values and Beliefs  Patterns of Behavior  Ceremonial events, written and spoken comments, and actual behaviors of an organization’s members.  Values and Beliefs  Guiding standards of an organization that affirm what should be practiced, as distinct from what is practiced.
  4. 4. Components of Organizational Culture  Signs and Symbols  Practices and actions that create and sustain a company’s culture.  Stories  The repeated tales and anecdotes that contribute to a company’s culture by illustrating and reinforcing important company values.  Rites and Ceremonies  Traditional culture-building events or activities that symbolize the firm’s values and help convert employees to these values.
  5. 5. Organizational Rites & Their Social Consequences Type of Rite Example Social Consequences Passage Army induction and basic training Commencement Greek Pledge Period Facilitate transition of person into new social roles and statuses Enhancement Annual awards night Enhance social identities and increase status of members Renewal Organizational Development activities Refurbish social structures and improve organization functioning Integration Office holiday party School Picnic Homecoming Encourage and revive common feelings that bind members together and commit them to the organization
  6. 6. Purpose of Culture  To help integrate organizational members so that they know how to relate and work together effectively.  To help the organization to best adapt to its mission and to its environment.
  7. 7. Effects of Culture  Determines how people communicate  How people interact  How people relate to one another  What is appropriate behavior  How power and status are allocated  Guides day-to-day working relationships
  8. 8. Levels of Corporate Culture The Iceberg Analogy Observable Symbols Ceremonies, Stories, Slogans, Behaviors, Dress, Physical Settings Invisible Aspects Underlying Values, Assumptions, Beliefs, Attitudes, Feelings
  9. 9. Stories, Symbols, & Language  They reinforce existing culture, but they don’t create culture by themselves.  Employees learn more from observed behavior.  Slogans, stories and symbols are useful in reinforcing desired behaviors.  The really important thing is for managers to display the desired values and beliefs in their day-to-day behaviors.
  10. 10. How Leaders Shape Culture  By what they do  The examples they set  The types of people they hire  By what they say  Formal policies, codes of ethics, etc.  By what the organization does  Ethical training, ethics committees VALUE-BASED LEADERSHIP
  11. 11. What Do Cultures Do?  Culture’s Functions 1. Defines the boundary between one organization and others 2. Conveys a sense of identity for its members 3. Facilitates the generation of commitment to something larger than self-interest 4. Enhances the stability of the social system 5. Serves as a sense-making and control mechanism for fitting employees in the organization
  12. 12. How Culture Begins  Stems from the actions of the founders:  Founders hire and keep only employees who think and feel the same way they do.  Founders indoctrinate and socialize these employees to their way of thinking and feeling.  The founders’ own behavior acts as a role model that encourages employees to identify with them and thereby internalize their beliefs, values, and assumptions.
  13. 13. Keeping Culture Alive  Selection  Concerned with how well the candidates will fit into the organization  Provides information to candidates about the organization  Top Management  Senior executives help establish behavioral norms that are adopted by the organization  Socialization  The process that helps new employees adapt to the organization’s culture
  14. 14. How Employees Learn Culture  Stories  Anchor the present into the past and provide explanations and legitimacy for current practices  Rituals  Repetitive sequences of activities that express and reinforce the key values of the organization  Material Symbols  Acceptable attire, office size, opulence of the office furnishings, and executive perks that convey to employees who is important in the organization  Language  Jargon and special ways of expressing one’s self to indicate membership in the organization
  15. 15. Ethical Values Ethics  Ethics refer to the code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong Managerial Ethics  Ethical decisions go far beyond behaviors governed by law  Managerial ethics guide the decisions and behaviors of managers
  16. 16. How Managers Shape Culture and Ethics Value-Based Leadership Formal Structure and Systems  Structure  Disclosure Mechanisms  Code of Ethics  Training Programs Managers play key role in providing leadership & examples of ethical behavior
  17. 17. What Influences Ethical Behavior At Work? Ethical Work Behaviors Individual Factors Organizational Factors Top Management Ethics Policies and Codes
  18. 18. How to Foster Ethics at Work  Emphasize top management’s commitment.  Publish an ethics code.  Establish compliance mechanisms. Involve personnel at all levels.  Train employees.  Measure results.