14

Organizationa
l Culture

Copyright © 2015 McGraw-Hill Education. All rights reserved. No

reproduction or distribution without the prior written consent of
McGraw-Hill Education.
Video
https://www.youtube.com/watch?v=Dd7Fixv
oKBw

What did you get from that video and what

does it have to do with culture?

14-2
Zappos’ Organizational
Culture
Zappos, the world’s largest
online shoe retailer, relies
on recruitment, selection,
socialization, and other
practices to maintain a
strong organizational
culture

14-3
Organizational Culture
Defined
The values/assumptions
shared within an
organization
Defines what is important
Provides direction toward
the “right way” of doing
things
Company’s DNA – invisible
to the eye, yet a powerful
template that shapes
employee behavior

14-4
Shared Value – values people in the work
unit have in common
Shared assumptions – deeper element that
expert believe is the essence of corporate
culture
Iceberg video :
https://www.youtube.com/watch?v=cjziCs-
R2S4

14-5
 Artifacts of
organizational
culture
Elements of
Organization
al
Culture

Organizational
culture

14-6
Content of
Organizational Culture
The relative ordering of values.
A few dominant values
Example: Facebook – creative, proactive, risk-oriented

Problems with measuring org culture

Oversimplifies diversity of possible values
Ignore shared assumptions
Adopts an “integration” perspective

An organization’s culture is fuzzy:

Diverse subcultures (“fragmentation”)
Values exist within individuals, not work units

14-7
Organizational Culture Profile
7 different corporate cultures:
Org Culture
Dimensions Dimension Characteristics
Experimenting, opportunity seeking, risk taking,
Innovation
few rules, low cautiousness
Stability Predictability, security, rule-oriented
Respect for
people
Fairness, tolerance

Outcome Action oriented, high expectations, results

orientation oriented
Attention to
detail
Precise, analytic
Team orientation Collaboration, people-oriented
Competitive, low emphasis on social
Aggressiveness
responsibility
Source: O’Reilly et al (1991)

14-8
Organizational
Subcultures
Dominant culture – most widely shared values
and assumptions

Subcultures
Located throughout the organization
Can enhance or oppose (countercultures) firm’s
dominant culture

Two functions of countercultures (values that

oppose the dominant culture):
provide surveillance and critique, ethics
source of emerging values

14-9
Cultural Artifacts at
Goldman Sachs
The language of Goldman
Sachs employees may be
artifacts of underlying
cultural values. “Elephant
trades” and “muppet”
clients suggest that the
investment firm values
profitability and individual
performance more than
customer service.

14-10
Organizational Culture
Artifacts
Observable symbols and signs
of culture
Physical structures,
ceremonies, language, stories
Maintain and transmit
organization’s culture
Need many artifacts to
accurately decipher a
company’s culture

E.g. Ways visitors are greeted,

organization’s layout, how
employees are rewarded.

14-11
Artifacts: Stories and
Legends
Social prescriptions of desired (or
dysfunctional) behavior – through stories
told

Realistic human side to expectations

Most effective stories and legends:

Describe real people
Assumed to be true
Known throughout the organization
Are prescriptive

14-12
Artifacts: Rituals,
Ceremonies, Language
Rituals
programmed routines
(e.g., how visitors are greeted) – in Malaysia, how is this
related? Sultan visits, etc…
Ceremonies
Planned activities for an audience
e.g., award ceremonies

Language
How employees address each other and outsiders, express
emotions, describe stakeholders, etc.
Leaders use language to anchor or change culture
Language also differentiates subcultures

14-13
Artifacts: Physical
Structures/Symbols
Building structure – may
shape and reflect culture
Office design conveys
cultural meaning
Furniture, office size, wall
hangings, art deco

Might be a low profile

company if the sign is
smaller.

14-14
Organizational Culture
Strength
How widely and deeply employees hold
the company’s dominant values and
assumptions
Most employees understand/embrace the culture
Institutionalized through artifacts
Long-lasting – possibly back to founder(s)

Three functions of strong cultures :

Control system
Social glue
Sense-making

14-15
Organizational Culture
and Effectiveness
Culture
Culture strength
strength
advantages
advantages depend
depend on:
on:

•• Environment
Environment fit
fit
•• Moderate
Moderate strength
strength
•• Adaptive
Adaptive culture
culture

Functions
Functions of
of Organizational
Organizational
Strong
Strong Cultures
Cultures Outcomes
Outcomes
•• Control
Control system
system •• Org
Org performance
performance
•• Social
Social glue
glue •• Employee
Employee well-being
well-being
•• Sense-making
Sense-making

14-16
Merging Cultures:
Bicultural Audit
Part of due diligence in merger
Minimizes cultural collision by diagnosing
companies
Three steps in bicultural audit:
1. Identify cultural artifacts
2. Analyze data for cultural conflict/compatibility
3. Identify strategies and action plans to bridge
cultures

14-17
Merging Organizational
Cultures

Acquired company embraces acquiring

Assimilation firm’s cultural values

Acquiring firm imposes its culture on

Deculturation unwilling acquired firm

Cultures combined into a new composite

Integration culture

Merging companies remain separate with

Separation their own culture

14-18
Changing/Strengthening
Organizational Culture

14-19
Changing/Strengthening
Organizational Culture
1. Actions of founders/leaders
Founder’s values/personality
Transformational leaders can reshape culture –
organizational change practices

2. Aligning artifacts
Artifacts keep culture in place

14-20
Changing/Strengthening
Organizational Culture
3. Introducing culturally consistent rewards
Rewards are powerful artifacts

4. Support workforce stability and communication

High turnover weakens org culture
Strong culture depends on frequent,
open communication

5. Attracting, selecting, and

socialization of employees
Attraction-selection-attrition theory
Socialization practices

14-21
Attraction-Selection-Attrition
Theory
Organizations become more homogeneous
(stronger culture) through:
Attraction – applicants self-select and weed out
companies based on compatible values
Selection – applicants selected based on values
congruent with organization’s culture
Attrition – employees quit or are forced out when
their values oppose company values

14-22
Organizational
Socialization
The process by which individuals learn the values,
expected behaviors, and social knowledge
necessary to assume their roles in the
organization
Learning Process
Newcomers make sense of the organization’s
physical, social, and strategic/cultural dynamics

Adjustment Process
Newcomers adapt to new work roles, team norms,
etc.

14-23
Stages of Socialization
Pre-Employment
Pre-Employment Encounter
Encounter Role
Role
Stage
Stage Stage
Stage Management
Management

•• Outsider
Outsider •• Newcomer
Newcomer •• Insider
Insider

•• Gathering
Gathering •• Testing
Testing •• Changing
Changing roles
roles
information
information expectations
expectations and
and behavior
behavior

•• Forming
Forming •• Resolving
Resolving
psychological
psychological conflicts
conflicts
contract
contract

14-24
Improving Organizational
Socialization
Realistic job preview (RJP)
A balance of positive and negative information
about the job and work context

Socialization agents
Supervisors – technical information, performance
feedback, job duties
Co-workers – ideal when accessible, role models,
tolerant, and supportive

14-25
Activity
https://www.youtube.com/watch?v=EcHpgs
Tg458
Look for the :
Shared Values
Shared Assumptions
Organizational culture language
Subculture
Is there any counter cultures?

14-26