Organizational Culture Management 201 Notes

Organizational Culture

• Definition: A system of shared meaning held by members that distinguishes an organization from others.

Seven Characteristics of Organizational Culture

• Innovation and Risk Taking: Encouragement of new ideas and experimentation.
• Attention to Detail: Emphasis on precision and accuracy in work processes.
• Outcome Orientation: Focus on results and performance.
• People Orientation: Consideration for the impact on employees and their well-being.
• Team Orientation: Collaboration and teamwork are valued.
• Aggressiveness: Competitiveness among employees and departments.
• Stability: Importance placed on maintaining the status quo and minimizing change.

Culture Understanding

• Descriptive Nature of Culture: Reflects how employees perceive the organization’s culture rather than whether they like it.
• Job Satisfaction: A measure of employees' affective responses to the work environment, focusing on feelings about the organization.

Organizational Culture Types

• Dominant Culture: Core values shared by a majority of members.
• Subcultures: Develop within larger organizations and reflect shared experiences among specific groups, mirroring but potentially modifying dominant culture values.

Strong vs. Weak Cultures

• Strong Culture:
  • Core values are intensely held and widely shared.
  • Influences behavior, increases cohesiveness, and lowers employee turnover.
• Weak Culture: Less influence on behavior and potential for higher turnover.

Culture vs. Formalization

• Formalization: High levels create predictability and consistency through rules.
• Culture: A strong culture can stabilize an organization without formal documentation.

Functions of Culture

• Defines Boundaries: Establishes what is acceptable behavior.
• Conveys Identity: Represents the organization’s values and mission.
• Generates Commitment: Inspires employees to feel a part of something larger.
• Enhances Stability: Provides a framework for navigating changes.
• Sense-Making and Control: Aids in understanding and managing organizational direction.

Organizational Climate

• Definition: Shared perceptions among members about the organization and work environment.
• Impact of Positive Climate: Linked to higher customer satisfaction and improved financial performance.

Ethical Work Climate (EWC)

• Definition: Shared concepts of right and wrong behavior reflecting organizational values.
• Effect on Decision Making: Shapes ethical decision-making processes among members.

Challenges of Culture

• Institutionalization: Behaviors and habits can become unquestioned, stifling innovation.
• Barriers to Change: Cultures can be resistant to change, especially in dynamic environments.
• Barriers to Diversity: Minimizing diversity can embed biases and prejudice.
• Mergers and Acquisitions: Cultural incompatibility can hinder successful integration.

Formation of Culture

• Founders' Influence: The ultimate source of an organization's culture is its founders.
  • Hiring Practices: Selecting individuals who align with founding values.
  • Indoctrination: Training employees to adopt the founders' worldviews.
  • Role Modeling: Founders act as role models for desired behaviors.

Maintaining Culture

• Selection Process: Hiring and retaining employees that fit the culture.
• Top Management Influence: Establishing norms through behavior and actions.
• Socialization: Assisting new employees in adapting to the culture.

Socialization Techniques

• Entry Options:
  • Formal: Structured training for new employees.
  • Collective and Fixed: Pre-planned activities for group bonding.
  • Divestiture: Removing old identity traits to adopt new ones.
  • Informal: Immediate immersion into the work environment.
  • Individual, Variable, Random: Personalized onboarding with no set timelines.
  • Investiture: Recognizing and confirming existing employee characteristics.

Learning Culture**

• Transmitted Through:
  • Stories: Narratives that provide context and explanations.
  • Rituals: Activities that reinforce key values and behaviors.
  • Material Symbols: Physical representations of culture and values.
  • Language: Specific terminologies that foster group identity.

Creating a Positive Organizational Culture

• Focus Areas:
  • Building on strengths of employees.
  • Emphasizing rewards over punishments.
  • Encouraging growth and vitality.
  • Acknowledging and integrating the external context of the organization.