Chapter 4:

Organizational Culture

Organizational Behavior-
OB202E
Fall 2021
 Learning Objectives

Describe the common characteristics of organizational culture.

Compare the functional and dysfunctional effects of

organizational culture on people and the organization.

Identify the factors that create and sustain an organization’s

culture.

Show how culture is transmitted to employees.

Creating an ethical culture, a positive culture, and a spiritual

culture.
Common Characteristics of
Organizational Culture

• A Definition of Organizational Culture

• Organizational culture refers to a system of shared
meaning held by members that distinguishes the
organization from other organizations.
Common Characteristics of
Organizational Culture
• Primary characteristics that capture the essence of an
organization’s culture:
– Adaptability
– Detail orientation
– Results/Outcome orientation
– People/Customer orientation
– Collaboration/Team orientation
– Integrity
Common Characteristics of
Organizational Culture

• Organizational culture is concerned with employees’

perceptions of the characteristics of the culture, not
whether they like them.
• Does it encourage teamwork?
• Does it reward innovation?
Common Characteristics of
Organizational Culture
• Do Organizations Have Uniform Cultures?
• Most organizations have a dominant culture and
numerous sets of subcultures.
• The dominant culture expresses the core values a most
members share and that give the organization distinct
personality.
• Subcultures tend to develop in large organizations to
reflect common problems, situations, or experiences
that members face.
 Common Characteristics of
Organizational Culture
• Strong versus Weak Cultures
• Strong culture: core values are intensely held and widely
shared.
• The more members who accept the core values and
the greater their commitment, the stronger the
culture and the greater its influence on member
behavior.
What Do Cultures Do? (1 of 9)

• The Functions of Culture

• Boundary-defining role.
• Conveys a sense of identity for members.
• Facilitates the generation of commitment.
• Enhances the stability of the social system.
• Serves as a sense-making and control mechanism.
What Do Cultures Do? (2 of 9)

• Culture Creates Climate

• Organizational climate is shared perceptions about the
organization and work environment.
• Team spirit at the organizational level.
• Climates can interact with one another to produce
behavior.
• Climate also influences the habits people adopt.
 What Do Cultures Do? (3 of 9)

• The Ethical Dimension of Culture

• Organizational cultures are not neutral in their ethical
orientation, even when they are not openly pursuing
ethical goals.
• Over time, the ethical culture, or the shared concept of
right and wrong behavior in that workplace, develops as
part of the organizational climate.
• The ethical climate reflects the true values of the
organization and shapes the ethical decision making of its
members.
What Do Cultures Do? (4 of 9)

• Ethical climate categorizes and measures the ethical

dimensions of organizational cultures.
• Each explains the general mindset, expectations, and
values of the managers and employees in relationship
to their organization.
• Ethical climate powerfully influences the way its members
feel they should behave.
 What Do Cultures Do? (5 of 9)

• Studies of ethical climates and workplace outcomes suggest

that some climate categories are likely to be found in certain
organizations.
• By measuring the collective levels of moral sensitivity,
judgment, motivation, and character of our organizations, we
may be able to judge the strength of the influence our ethical
climates have on us.
 What Do Cultures Do? (6 of 9)

• Sustainability: practices that can be maintained over very long

periods of time because the tools or structures that support
the practices are not damaged by the processes.
– Social sustainability practices.
• To create a truly sustainable business, an organization must
develop a long-term culture and put its values into practice.
What Do Cultures Do? (7 of 9)

• Culture and Innovation

• The most innovative companies have open,
unconventional, collaborative, vision-driven, and
accelerating cultures.
• Startup firms often have innovative cultures.
• They are usually small, and focused on solving
problems in order to survive and grow.
What Do Cultures Do? (8 of 9)

• Culture as an Asset
• Culture can significantly contribute to an organization’s
bottom line in many ways.
• There are many more cases of business success stories
because of excellent organizational cultures than there
are of success stories despite bad cultures, and almost
no success stories because of bad ones.
What Do Cultures Do? (9 of 9)

• Culture as a Liability
• Barriers to Change
• Barriers to Diversity
• Toxicity and Dysfunctions
• Barriers to Acquisitions and Mergers
 Creating and Sustaining Culture
(1 of 6)

• How a Culture Begins

• Ultimate source of an organization’s culture is its founders.
• Founders have the vision of what the organization should
be.
• New organizations are typically small, which facilitates the
founders’ imparting of their vision on all organizational
members.
Creating and Sustaining Culture
(2 of 6)

• Culture creation occurs in three ways:

• Founders hire employees who think and feel the way
they do.
• Employees are indoctrinated and socialized into the
founders’ way of thinking.
• Founders’ own behavior encourages employees to
identify with them and internalize their beliefs, values,
and assumptions.
Creating and Sustaining Culture
(3 of 6)

• Keeping a Culture Alive

• Selection
• Identify and hire individuals with the knowledge, skills,
and abilities to perform successfully.
• Top Management
• Establish norms of behavior.
Show How Culture is
Transmitted to Employees

• How Employees Learn Culture

• Culture is transmitted to employees through:
• Stories
• Rituals
• Symbols
• Language
Influencing an Organizational Culture
(1 of 5)

• How can management create a more ethical culture?

• Be a visible role model.
• Communicate ethical expectations.
• Provide ethics training.
• Visibly reward ethical acts and punish unethical ones.
• Provide protective mechanisms.
Influencing an Organizational
Culture (2 of 5)

• There is a trend today for organizations to attempt to

create a positive organizational culture:
• Emphasizes building on employee strengths.
• Rewards more than it punishes.
• Emphasizes individual vitality growth.
• Positive culture is not a cure-all.
Influencing an Organizational
Culture (3 of 5)

• What Is Spirituality?
• Workplace spirituality is not about organized religious
practices.

• Workplace spirituality recognizes that people have an

inner life that nourishes and is nourished by meaningful
work that takes place in the context of community.
Influencing an Organizational
Culture (5 of 5)
• Characteristics of a Spiritual Organization
• Cultural characteristics present in spiritual organizations
include:
• Benevolence
• Strong sense of purpose
• Trust and respect
• Open-mindedness
Identify Characteristics of a
Spiritual Culture (1 of 2)
• Achieving a Spiritual Organization
• Many organizations have grown interested in spirituality
but have had difficulty putting its principles into
practice.
• Leaders can demonstrate values, attitudes, and
behaviors that trigger intrinsic motivation and a sense
of calling through work.
• Encouraging employees to consider how their work
provides a sense of purpose through community
building also can help achieve a spiritual workplace.
Implications for Managers (2 of 3)

• Realize that an organization’s culture is relatively fixed in the

short term. To effect change, involve top management and
strategize a long-term plan.
• Hire individuals whose values align with those of the
organization; these employees will tend to remain
committed and satisfied. Not surprisingly, “misfits” have
considerably higher turnover rates.
• Understand that employees’ performance and socialization
depend to a considerable degree on their knowing what to
do and not do. Train your employees well and keep them
informed of changes to their job roles.