Module 3 Organizational Culture & Change

CHANGE & KNOWLEDGE MANAGEMENT

ORGANIZATIONAL CULTURE

Organizational Culture refers to a system of shared meaning held

by members that distinguishes the organization from other

organizations.

CONTRASTING ORGANIZATIONAL CULTURE

Organization A: This organization is a manufacturing firm. Managers are expected to fully document all decisions, and good managers are those who can provide detailed data to

support their recommendations.

Creative decisions that incur significant change or risk are not encouraged.

CONTRASTING ORGANIZATIONAL CULTURE

Projects are openly criticized and penalized, managers try not to implement ideas that deviate much from the status quo. Organization B: This organization is also a

manufacturing firm. Here, however,

management encourages and rewards risk taking and change. Decisions

CONTRASTING ORGANIZATIONAL CULTURE

Are well rationalized. Management prides itself on its history of experimenting with new technologies and its success in regularly introducing innovative products. Managers or employees who

have a good idea are encouraged to

run with it. And failures are treated as learning experiences.

SYSTEMS VIEW OF ORGANIZATIONAL CULTURE

Inputs from:

Outputs Process based on:

Society Profession s Laws Stories Heroes Attitudes towards competitio n Service

Assumptions Values Norms

(money, time, facilities, space and people)

Organizational Behaviours, Technologies Strategies Image Products Services Appearnce Style Etc etc

TYPES OF CULTURES
1. Mechanistic and Organic Cultures 2. Dominant and Subcultures 3. Strong vs. Weak cultures 4. Authoritarian and participative cultures

TYPES OF CULTURES
1. Mechanistic and Organic Cultures: Mechanistic culture is characterized by the values of bureaucracy. Organizational work is conceived as a system of narrow specialism and

people think of their careers mainly

within these specialism. This sort of culture resists change and innovation.

TYPES OF CULTURES
In Organic culture, there is great deal of emphasis on task accomplishment, team work, and free flow of communication- formal and informal. This sort of culture stresses flexibility,

consultation, change and innovation.

MECHANISTIC VS. ORGANIC

Feature
Task Definition Coordination and Control

Mechanistic
Rigid and highly specialized

Organic
Flexible and less narrowly defined

Rules and directives vertically Mutual adjustment, imposed common culture Vertical and horizontal Dispersed To the organization and its goals Unstable with significant technological uncertainty and ambiguity

Communication Vertical Knowledge Commitment and Loyalty Environmental Context Centralized To immediate supervisor Stable with low technological uncertainty

TYPES OF CULTURES
2. Dominant and Subcultures: A dominant culture expresses the core values that are shared by a majority of the

organizations members. It is the macro

view of culture that gives an

organization its distinct personality.

Subculture tend to develop in large organizations to reflect common

TYPES OF CULTURES
Face. These subcultures are likely to be defined by department designations and geographical separation. The purchasing department, for

example, can have a subculture that is

uniquely shared by members of that department. It will include the core values of

the dominant culture plus additional values

unique to members of the purchasing department.

TYPES OF CULTURES
3. Strong versus Weak Cultures :

Strong cultures have a greater impact on employee behaviour and are more

directly related to reduced turnover. In

a strong culture , the organizations core values are both intensely held and widely shared.

TYPES OF CULTURES
4. Authoritarian and Participative Cultures:

In the authoritarian culture power is concentrated on the leader and

obedience to orders and discipline are

stressed. Any disobedience is punished severely to set an example to others. The participative cultures rests on the

TYPES OF CULTURES
The decisions that are participatively made than to those which are imposed on them. Further, group problem-solving leads to better decisions because several new points and information are shared during discussions.

LEADER-SUBORDINATE RELATIONS AUTHORITARIAN LEADERS

LEADER-SUBORDINATE RELATIONS PARTICIPATIVE LEADERS

Participative Leader

Continued interaction and exchange of information between leader and subordinates and among subordinates.

NATURE OF CULTURE
Innovation and risk taking Attention to detail Outcome orientation

People orientation
Team orientation

Aggressiveness
Stability

FORMAL AND INFORMAL COMPONENTS OF CULTURE

Observed behavior regularities: When organizational participants interact with one another, they use common

language, terminology
Norms: Standards of behavior exist,

including guidelines
Dominant values: Example, high product quality, low absenteeism and

FORMAL AND INFORMAL COMPONENTS OF CULTURE

Rules: Strict guidelines related to getting along in the organization. Organizational climate: Overall feeling

that is conveyed by the physical layout,

the way participants interact and the

way members of the organization

conduct themselves with customers r other outsiders.

FORMAL AND INFORMAL COMPONENTS OF CULTURE

Johnson (1988), described a cultural web, identifying a number of components that can be used to describe

Organizational culture:
The Paradigm: What the organization is

about; what it does; its mission; its

values Control systems: The process in place

FORMAL AND INFORMAL COMPONENTS OF CULTURE

Organizational Structures: Reporting lines, hierarchies Power structures: Who makes the

decisions, how widely spread is power

Symbols: Organizational logos and

designs
Rituals and Routines: Management meetings

FUNCTIONS OF CULTURE
It has a boundary defining role; that is, it creates distinctions between one organization and others

Second, it conveys a sense of identity

for organization members

Third, culture facilitates the generation

of commitment to something larger than ones individual self interest

FUNCTIONS OF CULTURE
Culture is the social glue that helps hold the organization together by providing appropriate standards for

what employees should say and do

It serves as a sense-making and control

mechanism that guides and shapes the

attitudes and behavior of employees.

CREATING, SUSTAINING AND MANAGING CULTURE

Creating Culture: The ultimate source of an organizations culture: its founders

Example: The source of IKEAs

culture is founder Ingvar Kamprad,

who grew up in a poor farming area

in Sweden where people worked hard and lived frugally. Kamprad

Vision of creating a better everyday life for people by offering them affordable, functional, and well designed furniture.

He named his company IKEA by

combining his initials with the first

letters of Elmtaryd and Agunnaryd, the

farm and villages where he grew up. IKEAs success in expanding to 216

Kamprads vision and his continued influence as an active senior advisor to the company.

SUSTAINING ORGANIZATIONAL CULTURE

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

Selection practices Actions of top management Socialization methods

SELECTION

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 makers judgements. Selection becomes a two-way street as it provides information about the organization to the applicants.

TOP MANAGEMENT

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. For example, Robert A. Keirlin has been called the cheapest CEO in America. Keirlin is chairman and CEO of Fastenal Co., the largest specialty retailer of nuts and bolts in the U.S. with 6,500 employees. He clips grocery coupons, drives a Toyota, and stays in low-priced motels when he travels on business. Keirlin sees himself as a role model for frugality, and employees at Fastenal have learned to follow his example.

SOCIALIZATION

New employees are not familiar with the organizational culture and are potentially likely to disturb the existing culture. The process that adapts employees to the organizations culture. 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 PROCESS

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 groups values and norms.

Socialization Process

Outcomes

Productivity

Pre-arrival

Encounter

Metamorphosis

Commitment

Turnover

SOCIALIZATION MODEL

Robbins, 1989

HOW ORGANIZATION CULTURES FORM

Developing Culture: The content and strength of a culture influences an organizations ethical climate and the

ethical behavior of its members.

Strong organizational culture: Ex:

Johnson & Johnson

Unethical behavior: Ex: Enron What can managers do to create a more ethical culture?

Be a visible Role model

Communicate ethical expectations (Organizations code of ethics) Provide ethical training Visibly reward ethical acts and punish

unethical one

HOW EMPLOYEES LEARN CULTURE

Stories: They typically contain a narrative of events about the organizations founders, rags to riches

successes etc
Rituals: Rituals are repetitive sequence

of activities that express and reinforce

the key values of the organization

HOW EMPLOYEES LEARN CULTURE

Material Symbols: The layout of corporate headquarters, the types of automobiles top executives are given,

and the presence or absence of

corporate aircraft are a few examples of

material symbols. Others include the

size of offices, the elegance of furnishings, executive perks, and attire.

HOW EMPLOYEES LEARN CULTURE

Material Symbols: The layout of corporate headquarters, the types of automobiles top executives are given,

and the presence or absence of

corporate aircraft are a few examples of

material symbols. Others include the

size of offices, the elegance of furnishings, executive perks, and attire.

HOW EMPLOYEES LEARN CULTURE

Language: Many organizations and units within organizations use language as a way to identify members of a

culture or sub culture. Organizations,

over time, often develop unique terms

to describe equipment, offices, key

personnel, suppliers, customers, or products that relate to its business.

HOW EMPLOYEES LEARN CULTURE

If youre a new employee at Boeing, youll find yourself learning a whole unique vocabulary of acronyms, including :

BOLD (Boeing online data), etc

DESIGNING STRATEGIES FOR CULTURAL CHANGE

1. Change Reward Systems

2. Add new members

3. Implement culture shock 4. Change of top management 5. Involve members

CULTURE AS A LIABILITY
1. Barriers to Change

2. Barriers to Diversity
3. Barriers to Acquisitions and Mergers

High-Low Context
Context is the information that surrounds an event and is inextricably bound up with the meaning of that event.

High Context Shared culture & common background Meaning from how something is said; covert & implicit Reserved reactions Communication faster, more economical & satisfying than low context communication We is emphasized over I High commitment Patience & indirectness valued Arab cultures, Brazil, China, Japan, Korea, India, Mexico

Low Context Diverse cultures, backgrounds, & experiences Information is detailed, specific, & explicit to avoid miscommunication; overt & explicit Reactions on surface Meaning determined by what is said rather than how it is said Low commitment Straight talk, assertive, honesty valued USA, Australia, Canada, Switzerland, New Zealand, Russia, South Africa

Time Orientation: Monochronic vs. Polychronic

Monochronic Do one thing at a time Concentrate on job Take time commitments (deadlines, schedules ) seriously Are low context and need information Are committed to the job Adhere religiously to plans Are concerned about not disturbing others; follow rules of privacy and consideration Show great respect for private property; seldom borrow or lend Emphasize promptness Are accustomed to short-term relationships

Polychronic Do many things at once Easily distracted & interrupted Consider time commitments an objective to be achieved, if possible Are high context and already have information Are committed to people and human relationships Change plans often and easily Are more concerned with those who are closely related than with privacy Borrow and lend things often and easily Base promptness on the relationship Have strong tendency to build lifetime relationships

EGO STATES

Berne believed that when we interact with other people, our state of mind affects what happens He believed that there were three states of mind in all humans, no matter how old they were, called ego states.

ADULT PARENT CHILD

CHARACTERISTICS OF EGO STATES

Each ego state has particular verbal and non-verbal characteristics, which can be observed, if you are watching people. Each ego state has a positive and negative aspect

LOOK AT THE SENTENCES BELOW AND MATCH THE EGO STATE TO THE SENTENCE.
1.

2.

3.
4.

5.

Its not my fault my drink got spilt on your new carpet I wonder what might have caused that accident For goodness sake, clean up that mess. Shall we clean up the mess together with a wet cloth? I refuse to get involved in this incident.

CHILD ADULT

PARENT

LIFE POSITIONS

Berne believed that a lot of people get stuck in one ego state more than the other two and that this may be due to early childhood experiences. His theory was that in childhood we have a life position assigned to us, because of the experiences we have from birth onwards. He thinks there are four possible life positions Im not OK, Youre OK Im not OK, Youre not OK Im OK, Youre not OK Im OK, Youre OK

BASIC MENTAL ATTITUDES

Im OK, Youre OK: Those with this attitude have a basic down to earth acceptance of the relative significance of people including themselves. They know their own worth and expect other people to be cooperative Im OK, Youre not OK: This basic attitude is often found in people who were really badly treated as children. There is a tendency to blame others and to put them down or try to get rid of them, e.g., humiliating them, teasing them, giving bad service, etc Im not OK, Youre OK: This often occurs among people who feel powerless and insignificant in comparison with others. They often try to avoid other people, or attach themselves like parasites to another strong person. They are often depressive

BASIC MENTAL ATTITUDES

Im not OK, Youre not OK: This basic attitude can cause people to despair and lose interest in living. They can be confused, deeply depressive and unpredictable. They tend to go around in circles getting nowhere.

WHAT KIND OF EXPERIENCES MIGHT CAUSE THESE TWO LIFE POSITIONS?

Im not OK, Youre not OK

Im OK, Youre not OK

HOW DO LIFE POSITIONS AFFECT PEOPLES COMMUNICATION?

Berne thinks that peoples life positions tend to determine the script of their life in other words, if you think the world is against you Im not OK, Youre not OK, you will tend to make this a self-fulfilling prophecy. Your script will be a negative one, which makes your communication with others negative and makes negative things happen. Your nonverbal communication may be off-putting aggressive or withdrawn, your words may be the same. It is a bit like being an optimistic person or a pessimistic person. How you approach life and encounters with other people, affect how these encounters progress.

INTERNATIONAL CULTURE AND COMMUNICATION :CULTURAL TRAITS INFLUENCING COMMUNICATION ON THE JOB
U.S. Social Unit Authority structure Decision Making Importance of personal Relationships Role of formality Sense of History Importance of Time Individual Egalitarian Individualistic Beneficial Japan Group Hierarchical Consensus Essential Mexico Family Hierarchical Authoritarian Essential

Medium/low Low High

High High High (business) Low (personal)

High High Low

RESEARCHES ON CULTURE

Hofstedes Framework for assessing Cultures

Power distance: A national culture attribute describing the extent to which a society accepts that power in institutions and organizations is distributed unequally
Individualism vs Collectivism
Individualism:

A national culture attribute describing the degree to which people prefer to act as individuals rather than as members of groups. Collectivism: A national culture attribute that describes a tight social framework in which people expect others in groups of which they are a part to look after them and protect them

55

Masculinity versus femininity

Masculinity

:A national culture attribute describing the extent to which the culture favors traditional masculine work roles of achievement, power and control. Societal values are characterized by assertiveness and materialism Femininity: A national culture attribute that has little differentiation between male and female roles, where women are treated as the equals of men in all aspects of the society.

Uncertainty avoidance

A national culture attribute describing the extent to which a society feels threatened by uncertain and ambiguous situations and tries to avoid them.
56

 Long-term

versus short-term orientation Long-term orientation: A national culture attribute that emphasizes the future, persistence, and tradition Short-term orientation: People value the here-andnow, change is accepted more readily

57

HOFSTEDES CULTURAL VALUES BY NATION

Country United States India Japan PD 40 77 54 IVC 91 48 46 MVF 62 56 95 UA 46 40 92 LVSTO 29 61 80

Germany

35

67

66

65

31