This document discusses how organizational culture influences project success. It defines organizational culture as shared assumptions, values and behaviors that characterize how an organization functions. Certain cultural characteristics like member identity, group emphasis and risk tolerance are better for project work. A project manager must understand the organization's culture to effectively manage projects and emulate the management style. Culture can impact project planning, department interactions and performance evaluation.

2. Alignment of Projects with
Organisational Strategy

4.  The organizational culture of an entity will have a
direct influence on the success of a project.
Organizational culture includes:
■ Purpose
■ Values
■ Organization policies and procedures
■ The type of business
■ The maturity of the business

5.  As you can imagine, projects with more risk (and
expected reward) may be welcome in an organization
that readily accepts entrepreneurial ventures rather
than in an organization that is less willing to accept
chance and risk.
 Project formality is typically in alignment with the
culture of an organization

6.  Another influence on the progress of a project is the
management style of an organization.
 A project manager that is autocratic in nature will face
challenges and opposition in organizations that allow
and encourage self-led teams.
 A project manager must take cues from management
as to how the management style of a project should
operate.
 In other words, a project manager emulates the
management style of the operating organization

7. Organizational Culture
 Just as an organization’s structure affects its ability to
manage, so does an organization’s culture.
 Organizational culture is a set of shared assumptions,
values, and behaviors that characterize the functioning of
an organization
 Many experts believe the underlying causes of many
companies’ problems are not the structure or staff, but the
culture
 Even within one organization, one department’s culture may
be different from another department’s culture (technology
vs. finance)
 Some cultures make it easier to manage projects
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8. Ten Characteristics of
Organizational Culture1
 Member identity*
 Group emphasis*
 People focus
 Unit integration*
 Control
 Risk tolerance*
 Reward criteria*
 Conflict tolerance*
 Means-ends
orientation
 Open-systems focus*
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1 as per Stephen P. Robbins
*Project work is most successful in an organizational
culture where these items are strong/high and other
items are balanced

9. Ten Characteristics of
Organizational Culture
1. Member identity: The degree to which employees identify with
the organization as a whole rather than with their type of job or
profession.
 A PM or team member might feel more dedicated to his or her
company or project team than to their job or profession, or they
might not have any loyalty to a particular company or team.
 An organizational culture where employees identify more with the
whole organization are more conducive to a good project culture.
2. Group emphasis: The degree to which work activities are
organized around groups or teams, rather than individuals.
 An organizational culture that emphasizes group work is best for
managing projects.
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10. Ten Characteristics of
Organizational Culture
3. People focus: The degree to which management’s decisions take into
account the effect of outcomes on people within the organization.
 A PM might assign tasks to certain people without considering their
individual needs, or the PM might know each person very well and focus on
individual needs when assigning work or making other decisions.
 Good PMs often balance the needs of individuals and the organization.
4. Unit integration: The degree to which units or departments within an
organization are encouraged to coordinate with each other.
 Most PMs strive for strong unit integration to deliver a successful product,
service, or result.
 An organizational culture with strong unit integration makes the project
manager’s job easier.
5. Control: The degree to which rules, policies, and direct supervision are
used to oversee and control employee behavior.
 Experienced PMs know it is often best to balance the degree of control to get
good project results.
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11. Ten Characteristics of
Organizational Culture
6. Risk tolerance: The degree to which employees are encouraged to be
aggressive, innovative, and risk seeking.
 An organizational culture with a higher risk tolerance is often best for
project management since projects often involve new technologies, ideas,
and processes.
7. Reward criteria: The degree to which rewards, such as promotions and
salary increases, are allocated according to employee performance rather
than seniority, favoritism, or other non-performance factors.
 Project managers and their teams often perform best when rewards are
based mostly on performance.
8. Conflict Tolerance: The degree to which employees are encouraged to
air conflicts and criticism openly.
 It is very important for all project stakeholders to have good
communications, so it is best to work in an organization where people feel
comfortable discussing conflict openly.
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12. Ten Characteristics of
Organizational Culture
9. Means-ends orientation: The degree to which management
focuses on outcomes rather than on techniques and processes
used to achieve results.
 An organization with a balanced approach in this area is often best
for project work.
10. Open-systems focus: The degree to which the organization
monitors and responds to changes in the external environment.
 Projects are part of a larger organizational environment, so it is best
to have a strong open-systems focus.
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13.  One of the unique characteristics of organizations is the manner in
which each develops its own outlook, operating policies and
procedures, patterns of thinking, attitudes, and norms of behavior.
 Organizational culture is by one of the original writers defined as “the
solution to external and internal problems that has worked consistently
for a group and that is therefore taught to new members as the correct
way to perceive, think about, and feel in relation to these problems.”
 In other settings, such as anthropology, a culture is seen as the
collective or shared learning of a group, and it influences how that
group is likely to respond in different situations.
 Elements of culture: Unwritten, Rules of behavior, Held by some subset
of the organization, and Taught to all new members.
 An organization may contain a number of different cultures, operating
in different locations or at different levels.


14.  Researchers have examined some of the powerful forces that can
influence how a company’s culture emerges. Among the key
factors that affect the development of a culture are: technology,
environment, geographical location, reward systems, rules and
procedures, key organizational members, and critical incidents.
Critical incidents express culture because they demonstrate for
all workers exactly what it takes to succeed in an organization. In
other words, critical incidents are a public expression of what
rules really operate, regardless of what the company formally
espouses.

 Culture can affect project management in at least four ways:
Departmental interaction, Employee commitment to goals,
Project planning, and Performance evaluation.


15.  Escalation of commitment occurs when, in spite of
evidence identifying a project as failing, no longer
necessary, or beset by huge technical or other difficulties,
organizations continue to support it past the point an
objective viewpoint would suggest that it should be
terminated.

 Organizational culture must be managed, constantly
assessed, and when necessary, changed in ways that
promote project management rather than discouraging its
efficient practice. The context within which we manage our
projects is a key determinant in the likelihood of their
success or failure. Three critical contextual factors are the
organization’s strategy, structure, and culture.