Pargas Exam 2: Organizational Culture

What is an Organization's Culture?

A system of shared values, beliefs, and principles that impacts employees and their relationships

Values

Basic beliefs that the group shares that define preferences, behaviors, and what is right and wrong

Principles

Rules and standards of good behavior

Strong Culture

- Employees enjoy going to work
- Employees embrace responsibilities and follow the established policies and procedures

Weak Culture

- Employees work because they need the money
- Employees work for fear of management

How Culture Starts: Selection

Founders/Top management hire and keep employees who think and feel as they do

How Culture Starts: Specialization

Founders/Top Management indoctrinate and socialize employees to their way of thinking and feeling

How Culture Starts: Role Models

Founders and top managements' own behavior act as a role model that encourages behavior employees to identify with them

Managerial Implications

- Culture is hard for managers to change
- Selecting new hires that fit the culture is critical for motivation, commitment, job satisfaction, and low turnover

Observable Elements of Culture

- Practices
- Language
- Symbols

Non-Observable Elements of Culture

Norms, values, assumptions

Why the Right Culture is Important?

- Healthy corporate culture is noticeable
- Fosters trust and confidence in employees
- Is essential to a company's good performance
- They hire talented people and also retain them
- A company with high-employee satisfaction perform well in the long-term

Normative Culture

Expectations and procedures are well defined, employees strictly follow policies and procedures

Pragmatic

Emphasis is all on customers' satisfaction
- allows employees to not feel compelled to follow a set of rules

Academy

Growth, learning, and development is key
- training is the focus
- fosters longer working relationships

Baseball Team

Culture recognizes the value of the employee

Club

Culture of an exclusive club
- Recruitment is thorough
- Searching for education, specialties and interests

Fortress

Uncertainty and fear about their job, career, etc.
- company underperforms --> employees suffer or terminated

Tough Guy

Micromanaging, monitored work, frequent performance reviews

Bet Your Company

Risk is king
- Results could take long to be ascertain if the gambles pay off

Process

Guided by policies and procedures
- common in government

Keys to Culture

- Consistency
- Clear Mission
- Employee involvement
- Adaptability

How Employees Learn Culture: Symbols

An object, act, or event that conveys meanings to others

How Employees Learn Culture: Stories

A narrative based on true events, which is repeated - and sometimes embellished upon - to emphasize a certain value

How Employees Learn Culture: Heroes

Person whose accomplishments embody the values of the organization

How Employees Learn Culture: Rites and Rituals

Activities and ceremonies, planned and unplanned, that celebrate important occasions and accomplishments in the organization's life

Organizational Vision

-the desired future state of the organization
-depicts an ideal, but realistic future
-helps define the long-term future of the organization
-is challenging, inspirational and motivational

Vision for Right Culture

1. Align Values and Vision

2. Give Everyone A Piece Of The Pie

3. Encourage People To Fail

4. Focus On Communication

Organizational Mission

The reason for an organization's existence
- statement of purpose
- identifies what they do

Components of the Specific Environment

customers, competitors, suppliers, industry laws/regulations, advocacy groups

Supplier Dependence

How much power do your supplier(s) have over you?

Buyer Dependence

How important is a customer to a supplier?

Opportunistic Behavior

Someone benefits at the expense of the other

Relationship Behavior

Long-term mutually beneficial exchange between buyers and suppliers

One company's blueprint...

can't be the blueprint for another company