ORGANISATIONAL CULTURE Flashcards
KEY ASSUMPTIONS
- Organisational culture is a set of shared values, beliefs, and practices that shape the behaviour of people within an
organization. It is often seen as vital for the success of the organization and is shaped by key assumptions. - Culture is vital for success: Organizational culture is seen as a key driver of success, as it shapes the behaviour of
employees and provides a sense of identity and belonging. - Management need to control culture: Management is responsible for shaping and maintaining the organizational
culture, as they have the power to influence the values, beliefs, and practices that shape behaviour within the
organization. - Culture = the solution to management’s problems: Organizational culture is often seen as the solution to management’s
problems, as a strong culture can provide a sense of direction and purpose, and help employees to work towards
common goals. - Strong, unified culture increases performance: A strong, unified culture can increase performance by creating a sense of
commitment and motivation among employees, and by providing a framework for decision-making and problemsolving within the organization.
IMPORTANCE OF ORGANIZATIONAL CULTURE
Organizational culture is believed to have a significant impact on performance, with a strong culture often being associated with
high performance. Studies have shown that visionary companies outperform those without a clear vision by as much as 1500%
(Collins and Porras, 1994). Additionally, research by Deal and Kennedy (1982) suggests that a company can gain up to one or two
hours of productive work per employee per day through a strong culture. Peters and Waterman (1982) also identified a strong
culture as a key factor in “excellent companies.”
However, it is important to note that there are also myths about organizational culture, such as the idea that management
needs to control culture or that culture alone can solve management’s problems.
Despite the myths, a strong and unified culture is still considered important for organizations. It can serve as a source of identity
and purpose for employees, as well as help guide decision-making and behaviour. Additionally, a strong culture can contribute
to a positive work environment and help attract and retain talented employees
ALSO
Organizational culture can also have negative aspects such as corruption, greed, bullying, and abuse. These negative aspects can
arise when the values and norms of the culture are not aligned with ethical principles and standards. It is important for
organizations to establish and maintain a positive culture that promotes ethical behaviour and values, and to address and
correct any negative aspects that may emerge.
IN THE NEWS
Organizational culture is an important issue because it can shape the behaviour, attitudes, and values of individuals within an
organization. It can influence how employees interact with each other, how they treat customers or clients, and how they make
decisions. A positive and ethical culture can promote productivity, loyalty, and good reputation for the organization, while a
toxic culture can result in unethical practices, low morale, and reputational damage.
The Winterbourne View Care Home scandal highlighted the consequences of a toxic culture where employees were involved in
cruel and abusive practices towards vulnerable individuals in their care. The case exposed the need for better regulation and
oversight of care homes to ensure that the culture is one of care and respect for individuals.
The banking industry’s culture of greed and unethical practices, as exposed in the recent scandals, has eroded trust in the sector
and damaged its reputation. The focus on short-term profits, incentives based on individual performance, and lack of
accountability have resulted in unethical practices such as mis-selling, market manipulation, and money laundering. The industry
has been called upon to adopt a more ethical culture that prioritizes the long-term interests of customers and the wider society.
In summary, organizational culture is an important issue because it can have a significant impact on the behaviour and
performance of individuals within an organization, and can also affect the wider society. A positive and ethical culture can
promote productivity, loyalty, and good reputation for the organization, while a toxic culture can result in unethical practices,
low morale, and reputational damage
DEFINITION
- ‘Culture is the system of such publicly and collectively accepted meanings operating for a given group at a given time’
(Pettigrew, 1979: 574) - ‘The collective programming of the mind which distinguishes the members of one organization from another’
(Hofstede, 1991: 262) - ‘The basic assumptions and beliefs which are shared by members of an organization, that operate unconsciously, and
that define in a basic “taken-for-granted” fashion an organization’s view of itself and its environment’ (Schein, 2010). - Schein also defines culture as ‘a set of basic assumptions [that] defines for us what to pay attention to, what things
mean’ (2010: 32)
CULTURE - SHAPING OUR WORLDVIEW
- Culture refers to the shared values, beliefs, practices, and customs that define a group or society.
- It shapes the way people think, talk, and behave, and it can influence their worldview.
- Culture provides scripts of acceptable and unacceptable behaviour, which are learned through socialization and
reinforced by social norms. - It is considered valuable because it offers norms to solve problems and helps people understand their place in society.
- However, culture can also be controlling, limiting people’s choices and reinforcing inequalities.
- The Role of Culture in Organizations
- Organizational culture refers to the shared values, beliefs, and practices that define the way people behave and interact
within a particular workplace. - It can influence the way employees approach their work, their relationships with colleagues, and their commitment to
the organization’s goals. - A strong, positive culture can improve employee engagement, productivity, and retention.
- However, a negative culture can lead to toxic behaviours, such as bullying, harassment, and discrimination.
- It is important for organizations to understand their culture and actively shape it to promote positive behaviours and
outcomes.
EXAMPLES IN THE NEWS
- The Winterbourne View Care Home and the culture of cruelty that existed there highlighted the importance of
organizational culture in the healthcare industry. - The culture of greed in leading banks, which has been blamed for unethical practices and financial scandals,
demonstrated the negative impact of a toxic culture on the wider economy. - Other examples in the news include workplace harassment and discrimination, which can be perpetuated by a negative
culture.
CONCLUSION - Organizational culture is an important issue that can shape behaviour, values, and outcomes in the workplace.
- It is vital for organizations to actively manage their culture to promote positive behaviours and outcomes and to
prevent toxic behaviours that can lead to harm and damage to reputation.
IN SEARCH OF EXCELLENCE
The book explores the characteristics of successful firms and focuses on the importance of top management leadership through
culture. In their research, Peters and Waterman found that strong cultures are characterized by clear shared values, harmony,
unambiguous communication, and being functional and productive. The book highlights several examples of firms that embody
these cultural traits, such as IBM, Hewlett-Packard, and Procter & Gamble. The success of In Search of Excellence led to a greater
emphasis on the importance of organizational culture in management theory and practice.
NEW WAY TO MANAGE
RATIONAL MANAGEMENT:
- Based on hard, rational argument: This approach relies on data, facts, and figures. Decisions are made based on
numbers, budgets, strategy, and targets. - Management control imposed: Workers are controlled through rules, procedures, and systems of accountability.
Hierarchical structures are used to enforce control. - Formal communication: Communication is formal and typically occurs through newsletters, emails, and other written
channels. - Control, monitoring, and evaluation: This approach emphasizes monitoring and evaluation to ensure that goals are
being met
CULTURAL MANAGEMENT:
- Soft approach: This approach relies on emotional appeals through shared values and purposes. Workers are
encouraged to control themselves. - Reliance on informal opinion leaders: Cultural management places a strong emphasis on traditions, accepted practices,
and a sense of mission. Workers rely on informal opinion leaders to guide their behaviour. - Trust, commitment, and autonomy: This approach emphasizes trust, commitment, and autonomy. Workers are given
the freedom to make decisions and act independently.
ADVANTAGES OF MANAGING THROUGH CULTURE
Managing through culture can bring several advantages to organizations, such as:
➢ Increased sense of belonging: When employees feel that they are part of a community with shared values and beliefs,
they are more likely to feel a sense of belonging and loyalty to the organization.
➢ Increased commitment: A strong organizational culture can create a sense of shared purpose and direction that inspires
employees to work together to achieve common goals, which can lead to greater commitment to the organization and
its mission.
➢ Shared values: Shared values provide a framework for decision-making and behaviour that is aligned with the
organization’s overall goals and purpose, which can help to create consistency and coherence throughout the
organization.
➢ Shared language: A strong organizational culture often involves the use of common language and symbols that help to
reinforce the organization’s values and identity, and can facilitate communication and understanding among
employees.
➢ Engages hearts and minds: Managing through culture can help to engage employees on an emotional level, creating a
sense of meaning and purpose that goes beyond the rational pursuit of financial or strategic goals. This can lead to
greater motivation and creativity, and can help to foster a culture of innovation and continuous improvement.
Overall, managing through culture can help organizations to build a stronger sense of identity and purpose, and can create a
more committed and engaged workforce that is better equipped to meet the challenges of a rapidly changing business
environment.
GOOGLE CULTURE
➢ Google is known for having a unique and highly desirable culture that fosters creativity, innovation, and collaboration.
Some key aspects of Google’s culture include:
➢ A focus on employee well-being: Google provides its employees with a range of perks and benefits, including free
healthy meals, on-site fitness facilities, and flexible work arrangements.
➢ A flat organizational structure: Google encourages collaboration and open communication among all employees,
regardless of their job titles.
➢ Innovation and experimentation: Google encourages its employees to take risks and explore new ideas, with a focus on
creating products and services that improve people’s lives.
➢ Data-driven decision making: Google uses data and analytics to make decisions, rather than relying on intuition or gut
feelings.
➢ Emphasis on learning and development: Google provides its employees with a range of learning and development
opportunities, including training programs, mentorship, and on-the-job learning.
CULTURAL TYPOLOGIES – DEAL AND KENNEDY
Deal and Kennedy proposed four cultural typologies based on the relationship between risk and feedback in an organization:
1. Work hard play hard: This culture is characterized by low risk and rapid reward. The focus is on achieving quick results,
and there is a high degree of employee involvement and participation. Examples of such organizations include real
estate, computer, and car dealerships.
2. Tough guy, macho culture: This culture is characterized by high risk and rapid reward. It is often found in organizations
that operate in highly competitive industries, such as construction, entertainment, and consultancy.
3. Process culture: This culture is characterized by low risk and slow reward. The focus is on following established
procedures and protocols, with a high degree of emphasis on consistency and stability. Examples of such organizations
include utilities and financial services.
4. Bet the company culture: This culture is characterized by high risk and slow reward. It is often found in organizations
that operate in highly volatile and unpredictable industries, such as investment banks, oil, and architecture.
Organizational culture is not fixed, and it can change over time due to various factors such as changes in leadership, industry
trends, or the external environment. Understanding cultural typologies can help organizations identify their strengths and
weaknesses and make changes to improve their performance.
CULTURAL TYPOLOGIES – HANDY
Power culture (Zeus):
➢ Control and decision making are centralized in the hands of a few individuals
➢ Often found in small businesses, family firms, and startups
➢ Few formal rules, and decisions are based on personal power and relationships
➢ Competitive and tough environment
Role culture (Apollo):
➢ Bureaucratic culture with a clear hierarchy of authority
➢ Each employee has a specific role and responsibilities
➢ Decision making is centralized at the top
➢ Works well in stable and predictable environments
➢ Examples include civil service and high street banks
Task culture (Athena):
➢ Focus is on getting the job done through temporary teams
➢ Expertise is highly valued, and control is based on allocation of resources
➢ Teams are formed to complete a specific task and then disband
➢ Examples include project management, advertising, and construction
Personal or cluster culture (Dionysius):
➢ Focus on individual freedom and consensus management
➢ Reject formal hierarchies and exist for the members rather than a collective goal
➢ Examples include self-help groups and architect partnerships
➢ Each of these cultural typologies has its own strengths and weaknesses. Organizations may adopt a combination of
these cultural types based on their needs and external environment
CULTURAL TYPOLOGIES – QUINN AND ROHRBAUGH
Quinn and Rohrbaugh’s Cultural Typology model categorizes cultures based on their level of focus on external (stability) or
internal (flexibility) factors, as well as the level of control (stability) or autonomy (flexibility) present in the culture. The four
resulting culture types are:
1. Clan Culture: Emphasizes flexibility and internal focus, with a familial atmosphere that prioritizes collaboration,
teamwork, and employee development. Control is achieved through social norms and traditions rather than formal
procedures.
2. Adhocracy Culture: Emphasizes flexibility and external focus, with an entrepreneurial and risk-taking attitude that
prioritizes innovation and creativity. Control is achieved through an emphasis on individual initiative and decentralized
decision-making.
3. Market Culture: Emphasizes stability and external focus, with a competitive and results-oriented attitude that
prioritizes achievement and goal-setting. Control is achieved through a focus on quantifiable performance measures.
4. Hierarchy Culture: Emphasizes stability and internal focus, with a structured and rule-bound atmosphere that prioritizes
control, efficiency, and predictability. Control is achieved through formal procedures, policies, and systems of authority.
Each culture type has its own set of strengths and weaknesses, and understanding which type best fits an organization’s needs
can help to improve overall performance and effectiveness.
