16

Organizational Culture
McGraw-Hill/Irwin 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Corporate Culture Hits Schwab

Executives at Charles Schwab & Co. underestimated the influence of organizational culture on behavior when they acquired U.S. Trust

AP/Wide World Photos.

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Organizational Culture Defined

The basic pattern of shared values and assumptions governing the way employees within an organization think about and act on problems and opportunities.
AP/Wide World Photos.

McShane/Von Glinow OB4e

Slide 16-3

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Elements of Organizational Culture

Artifacts
Stories/legends Rituals/ceremonies Organizational language Physical structures/dcor

Visible

Shared values
Conscious beliefs Evaluate what is good or bad, right or wrong

Invisible
(below the surface) Shared assumptions
Unconscious, taken-for-granted perceptions or beliefs Mental models of ideals
McShane/Von Glinow OB4e Slide 16-4 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Meaning of Cultural Content

Cultural content refers to the relative ordering of beliefs, values, and assumptions. Example: Software company SAS Institute has an employee-focused culture that emphasizes work-life balance. An organization emphasizes only a handful of values out of dozens or hundreds of values that exist.

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Organizational 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

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Mayo Clinic Deciphers its Culture

Courtesy of the Mayo Clinic

To decipher its culture and identify ways to reinforce it at the two newer sites, the Mayo Clinic retained an anthropologist who shadowed employees, joined physicians on patient visits, and posed as a patient to observe what happens in waiting rooms.

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Artifacts: Stories and Legends

Social prescriptions of desired (undesired) behavior Provides a realistic human side to expectations Most effective stories and legends:
Describe real people Assumed to be true Known throughout the organization Are prescriptive

McShane/Von Glinow OB4e

Slide 16-8

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Artifacts: Rituals and Ceremonies

Rituals
programmed routines (eg., how visitors are greeted)

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

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Artifacts: Organizational Language

Words used to address people, describe customers, etc. Leaders use phrases and special vocabulary as cultural symbols
eg. Referring to clients rather than customers

Language also found in subcultures

eg. Whirlpools PowerPoint culture

McShane/Von Glinow OB4e

Slide 16-10

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Artifacts: Physical Structures/Symbols

Building structure -- may shape and reflect culture
Example: Oakleys interplanetary headquarters looks like a vault, representing the eyewear and clothing companys protective culture

Office design conveys cultural meaning

Furniture, office size, wall hangings

McShane/Von Glinow OB4e

Slide 16-11

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Benefits of Strong Corporate Cultures

Social Control Strong Organizational Culture Social Glue

Improves SenseSense-Making

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Problems with Strong 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.

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Adaptive Organizational Cultures

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

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Org Culture and Ethics

Executives view org culture as one of three main influences on business ethics Organizational culture also an ethical problem when it is very strong --corporate cults

McShane/Von Glinow OB4e

Slide 16-15

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Bicultural 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

McShane/Von Glinow OB4e

Slide 16-16

2008 The McGraw-Hill Companies, Inc. All rights reserved.

Merging Organizational Cultures

Assimilation
Acquired company embraces acquiring firms cultural values Acquiring firm imposes its culture on unwilling acquired firm Cultures combined into a new composite culture Merging companies remain separate with their own culture

Deculturation

Integration

Separation

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Strengthening Organizational Culture

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Whole Foods Spreads its Culture

When expanding operations, Whole Foods Market maintains its culture through a yoghurt culture strategy. This is a socialization process in which current employees who carry the grocers unique culture are transferred to new stores so recently-hired employees learn and embrace that culture more quickly.

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Organizational Socialization Defined

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

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Socialization: Learning & Adjustment

Learning Process
Newcomers make sense 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

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Stages of Socialization
PrePre-Employment Stage
Outsider Gathering information Forming psychological contract

Encounter Stage
Newcomer Testing expectations

Role Management
Insider Changing roles and behavior Resolving conflicts

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Pre-employment Socialization Conflicts

A: Firm sells the job and company, hides negative info B: Applicant polishes up the rsum to look good C: Applicant avoids asking important questions that may be awkward (e.g. pay) D: Company avoids using valid selection tests that might scare away applicants Individual Attracts Organization
B C A D

Organization Attracts Individual

Individual Selects Organization

Organization Selects Individual

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

Realistic Job Previews

A balance of positive and negative information about the job and work context Benefits of RJPs
Less turnover, higher job performance Less reality shock Vaccination effect Builds loyalty

McShane/Von Glinow OB4e

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2008 The McGraw-Hill Companies, Inc. All rights reserved.

16

Organizational Culture
McGraw-Hill/Irwin 2008 The McGraw-Hill Companies, Inc. All rights reserved.