ORGANIZATIONAL BEHAVIOR

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Van
Van Citys
Citys Corporate
Corporate Culture
Culture

Courtesy of VanCity

Vancouver City Savings Credit Union has re-affirmed its

corporate culture to improve customer service and employee
relations.

Organizational
Organizational Culture
Culture Defined
Defined

Courtesy of VanCity

The basic pattern of shared assumptions, values, and

beliefs considered to be the correct way of thinking
about and acting on problems and opportunities facing
the organization.

DEFINING
DEFININGORGANISATIONAL
ORGANISATIONALCULTURE
CULTURE(Cooke
(Cookeand
andRosseau,
Rosseau,1988)
1988)

the ways of thinking, behaving and believing

that members of a social unit have in common

The Basic Functions of Organizational Culture

Organizational
Culture/Basic functions

Provides a
sense of
identity for
members

Enhances
commitment
to the
organizations
mission

Clarifies
and
reinforces
standards
of behavior

Levels
Levels of
of culture
culture
National culture
Occupational culture
Organisational culture

Elements
Elementsof
ofOrganizational
OrganizationalCulture
Culture

Artifacts of
Organizational
Culture

Physical Structures
Language
Rituals and
Ceremonies
Stories and Legends

Organizational
Culture
Beliefs
Values
Assumptions

Rand
Rand Merchant
Merchant Banks
Banks Culture
Culture
When employees at Rand
Merchant Bank received a
booklet entitled The Complete
Book of Rules, they
discovered that the pages
inside were blank. The book
was a reminder that the South
African financial institutions
culture encourages
employees to make their own
decisions.

Courtesy of Rand Merchant Bank

Meaning
Meaning of
of Cultural
Cultural Content
Content
Cultural content refers to the
relative ordering of beliefs,
values, and assumptions.
Example: Rand Merchant
Banks empowerment
culture
An organization emphasizes
only a handful of values out
of dozens or hundreds of
values that exist.
Courtesy of Rand Merchant Bank

Organizational
Organizational Culture
Culture

Todays Mergers and Acquisitions: Will They be Tomorrows Culture Clashes?

This bank

Merged with

To become

Citicorp

Travelers

Citigroup

Bank America

Nations Bank

Bankamerica

Bank One

First Chicago NBD

Bank One

First Union

Corestates

First Union

Organizational
Organizational Subcultures
Subcultures
Located throughout the organization
Can enhance or oppose (countercultures) firms
dominant culture
Two functions of countercultures:
provide surveillance and critique, ethics
source of emerging values

Artifacts:
Artifacts: Stories
Stories and
and Legends
Legends
Social prescriptions of desired (undesired)
behavior
Stories about the past corporate incidents
serve as powerful social prescriptions of the the
things should be done.
Most effective stories and legends:

Describe real people

Assumed to be true
Known throughout the organization
Are prescriptive

Artifacts:
Artifacts: Rituals
Rituals and
and Ceremonies
Ceremonies
Rituals
programmed routines
(eg., how visitors are greeted),dress code,

Ceremonies
planned activities for an audience
(eg., award ceremonies)

Artifacts:
Artifacts: Organizational
Organizational Language
Language
Words used to address people, describe
customers, etc.
Is boss happening?

Has your boss come?

Promo

Promotion

Aps

Advertising positioning
statement

Cool

Everything is fine

Googly

Tricky situation

Account

client

Artifacts:
Artifacts: Physical
PhysicalStructures/Symbols
Structures/Symbols

Building structure -- may shape and reflect

culture
Oakleys Interplanetary Headquarters in
Foothill Ranch, California

Office design conveys cultural meaning

Furniture, office size, wall hangings

Benefits
Benefitsof
ofStrong
StrongCorporate
CorporateCultures
Cultures

Social
Control
Strong
Organizational
Culture

Social
Glue
Improves
Sense-Making

Problems
Problems with
with Strong
Strong Cultures
Cultures
1. Culture content might be misaligned with the
organizations environment.
2. Strong cultures may focus on mental models that
could be limiting
3. Strong cultures suppress dissenting values from
subcultures.

Adaptive
Adaptive Organizational
Organizational Cultures
Cultures
External focus -- firms success depends on
continuous change
Focus on processes more than goals
Strong sense of ownership
Proactive --seek out opportunities

Merging
MergingHP
HPWay
Waywith
withCompaq
CompaqCulture
Culture

Hewlett-Packard CEO Carly Fiorina

(left) wanted to inject Compaq
Computers responsiveness into HPs culture by merging the two firms.
Meanwhile, Compaq suffered from
clashing cultures a few years earlier
when acquiring Digital Equipment
Corp., so Compaq executives were
careful to ensure the merger with HP was culturally feasible.

Reuters/New media, Inc./ CORBIS

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

Reuters/New media, Inc./ CORBIS

Merging
Merging Organizational
Organizational Cultures
Cultures
Assimilation
Deculturation

Acquired company embraces

acquiring firms cultural values
Acquiring firm imposes its culture on
unwilling acquired firm

Integration

Cultures combined into a new

composite culture

Separation

Merging companies remain

separate with their own culture

Strengthening
StrengtheningOrganizational
OrganizationalCulture
Culture

Founders
and leaders
Selection
and
socialization

Strengthening
Organizational
Culture

Managing the
cultural
network

Culturally
consistent
rewards

Stable
workforce

Organizational
OrganizationalSocialization
SocializationDefined
Defined
The process by which individuals learn the
values, expected behaviors, and social
knowledge necessary to assume their roles in
the organization

Socialization:
Socialization:Learning
Learning&&Adjustment
Adjustment
Learning Process
Newcomers form a cognitive map of the
organizations physical, social, and
strategic/cultural dynamics

Adjustment Process
Newcomers need to adapt to their new work
environment
New work roles
New team norms
New corporate cultural values

Stages
Stages of
of Socialization
Socialization
Pre-Employment
Stage

Encounter
Stage

Role
Management

Outsider

Newcomer

Insider

Gathering
information

Testing
expectations

Changing roles
and behavior

Forming
psychological
contract

Resolving
conflicts

Pre-employment
Pre-employmentSocialization
SocializationConflicts
Conflicts

Individual
Attracts
Organization
Conflict C

Individual
Selects
Organization

Organization
Attracts
Individual
tA
c
i
l
nf
o
C

Co
nf
lic

Conflict D

tB

Organization
Selects
Individual

The Process of Innovation

Stage 1

Stage 2

Stage 3

Stage 4

Setting
the
Agenda

Setting
the
Stage

Producing
the
Ideas

Testing and
Implementing
the Ideas

Motivation

Individual
or Team
Productivity
Resources
Skills

Stage 5

Progress

Success
Outcome
Assessment
Failure

End
End

Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
Key Variables Shaping Customer-Responsive
Cultures
1. The types of employees hired by the
organization.
2. Low formalization: the freedom to meet customer
service requirements.
3. Empowering employees with decision-making
discretion to please the customer.
4. Good listening skills to understand customer
messages.
5. Role clarity that allows service employees to act
as boundary spanners.
6. Employees who engage in organizational
citizenship behaviors.

Creating
Creating An
An Ethical
Ethical Organizational
Organizational Culture
Culture
Characteristics of Organizations that Develop
High Ethical Standards
High tolerance for risk
Low to moderate in aggressiveness
Focus on means as well as outcomes

Managerial Practices Promoting an Ethical

Culture

Being a visible role model.

Communicating ethical expectations.
Providing ethical training.
Visibly rewarding ethical acts and punishing
unethical ones.

What
What Is
Is Organizational
Organizational Culture?
Culture?

Characteristics:
Characteristics:
1.1. Innovation
Innovationand
andrisk
risk
taking
taking
2.2. Attention
Attentionto
todetail
detail
3.3. Outcome
Outcomeorientation
orientation
4.4. People
Peopleorientation
orientation
5.5. Team
Teamorientation
orientation
6.6. Aggressiveness
Aggressiveness
7.7. Stability
Stability

Institutionalization:
Institutionalization: AAForerunner
Forerunner of
of Culture
Culture

What
What Is
Is Organizational
Organizational Culture?
Culture? (contd)
(contd)

What
What Is
Is Organizational
Organizational Culture?
Culture? (contd)
(contd)
Culture Versus Formalization
A strong culture increases behavioral
consistency and can act as a substitute for
formalization.

Organizational Culture Versus National Culture

National culture has a greater impact on
employees than does their organizations
culture.
Nationals selected to work for foreign companies
may be atypical of the local/native population.

What
What Do
Do Cultures
Cultures Do?
Do?

Cultures
CulturesFunctions:
Functions:
1.1. Defines
Definesthe
theboundary
boundarybetween
betweenone
one
organization
organizationand
andothers.
others.
2.2. Conveys
Conveysaasense
senseof
ofidentity
identityfor
forits
itsmembers.
members.
3.3. Facilitates
Facilitatesthe
thegeneration
generationof
ofcommitment
commitmentto
to
something
somethinglarger
largerthan
thanself-interest.
self-interest.
4.4. Enhances
Enhancesthe
thestability
stabilityof
ofthe
thesocial
socialsystem.
system.

What
What Do
Do Cultures
Cultures Do?
Do?

Culture
Cultureas
asaaLiability:
Liability:
1.1. Barrier
Barrierto
tochange
change
2.2. Barrier
Barrierto
todiversity
diversity
3.3. Barrier
Barrierto
toacquisitions
acquisitionsand
and
mergers
mergers

Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
Managerial
ManagerialActions:
Actions:
Select
Selectnew
newemployees
employeeswith
withpersonality
personalityand
and
attitudes
attitudesconsistent
consistentwith
withhigh
highservice
service
orientation.
orientation.
Train
Trainand
andsocialize
socializecurrent
currentemployees
employeesto
tobe
be
more
morecustomer
customerfocused.
focused.
Change
Changeorganizational
organizationalstructure
structureto
togive
give
employees
employeesmore
morecontrol.
control.
Empower
Empoweremployees
employeesto
tomake
makedecision
decisionabout
about
their
theirjobs.
jobs.

Keeping
Keeping Culture
Culture Alive
Alive
Selection
Concerned with how well the candidates will fit
into the organization.
Provides information to candidates about the
organization.

Top Management
Senior executives help establish behavioral
norms that are adopted by the organization.

Socialization
The process that helps new employees adapt to
the organizations culture.

Stages
Stages in
in the
the Socialization
Socialization Process
Process

AASocialization
Socialization Model
Model

EXHIBIT

18-2

Entry
Entry Socialization
Socialization Options
Options

Formal
Formalversus
versusInformal
Informal
Individual
Individualversus
versusCollective
Collective
Fixed
Fixedversus
versusVariable
Variable
Serial
Serialversus
versusRandom
Random
Investiture
Investitureversus
versusDivestiture
Divestiture

EXHIBIT

18-3

How
How Organization
Organization Cultures
Cultures Form
Form

EXHIBIT

18-4

How
How Employees
Employees Learn
Learn Culture
Culture
Stories
Stories
Rituals
Rituals
Material
MaterialSymbols
Symbols
Language
Language

Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
Managerial
ManagerialActions
Actions(contd)
(contd)::
Lead
Leadby
byconveying
conveyingaacustomer-focused
customer-focusedvision
vision
and
anddemonstrating
demonstratingcommitment
commitmentto
tocustomers.
customers.
Conduct
Conductperformance
performanceappraisals
appraisalsbased
basedon
on
customer-focused
customer-focusedemployee
employeebehaviors.
behaviors.
Provide
Provideongoing
ongoingrecognition
recognitionfor
foremployees
employeeswho
who
make
makespecial
specialefforts
effortsto
toplease
pleasecustomers.
customers.

Spirituality
Spirituality and
and Organizational
Organizational Culture
Culture

Characteristics:
Characteristics:
Strong
Strongsense
senseof
of
purpose
purpose
Focus
Focuson
onindividual
individual
development
development
Trust
Trustand
andopenness
openness
Employee
Employee
empowerment
empowerment
Toleration
Tolerationof
ofemployee
employee
expression
expression

How
How Organizational
Organizational Cultures
Cultures Have
Have an
an Impact
Impact
on
on Performance
Performance and
and Satisfaction
Satisfaction

EXHIBIT

18-7