Organizational Culture Flashcards
What is organizational culture?
Basic assumptions and beliefs that are shared by members of an organization . . . Define in a basic “taken-for-granted” fashion, an organization’s view of itself and its environment” - (Schein, 1985, p. 5-6)
A shared pattern of beliefs, expectations, and meanings that influence and guide the thinking and behaviors of the members of an organization - (Hartman et al, 2014).
Regarding business Myth 2: Unethical behaviour in business is simply the result of “bad apples.” How is it related to org. culture?
Culture is an important contextual factor (Cohen, 1993; Myers, 2004; Trevino, 1986)
Most unethical behaviour in business is supported by the context in which it occurs people ‘look up and around,’ do what others do or expect them to do
What is corporate culture?
Corporate culture –
Sets expectations and norms that determine which decisions are made, how they are made, etc.
Effective culture v ethical culture
What are ethical cultures?
Ethical cultures
Ethical culture are effective but they also empower and expect employees to act in ethically responsible ways even when the law does not require it.
Ethical cultures:
Helps employees take responsibility for their behaviours
Encourages them to question orders to behave unethically
Encourages them to report misconduct or problems
What are 5 Characteristics of Ethical Business Cultures?
DRIVEN LONG BALANCE EFFECTIVE PROCESS
- Driven by Mission and Values
- Long-term Perspective
- Stakeholder Balance
- Leadership Effectiveness
- Process Integrity
What are the characteristics of a culture Driven by Mission and Values?
> ‘‘Clarity of mission and values, reflected in ethical guidelines and behavior’’
> ‘‘Institutionalizes ethical values’’
> ‘‘Build relationships of trust and respect’’
> ‘‘Strong culture that actively eliminates people who don’t share the values’’
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‘Corporate values are sustained over long periods of time’’
What are the characteristics of a culture with a Long-term Perspective?
> ‘‘Place mission above profit and long-term over short-term’’
‘> ‘Acting in the best interests of customers, over the longer term’’
‘‘Board takes long view in managing shareholder value’’
‘‘Connect environmental sustainability, social responsibility, and profit’’
‘‘CEO says he’s building an institution that he hopes will be here in 50 years’’
What are the characteristics of a culture that seeks Stakeholder Balance?
> ‘‘Balance all stakeholders (e.g., customers, employees, owners and community) in all their decision-making, consistently’’
> ‘‘Deal with all stakeholders on a consistently ethical and value-oriented basis’’
> ‘‘Good balance of customer value and profit’’
> ‘‘Giving back to the community in which the company does business’’
> ‘‘Work to be a good corporate citizen in a global economy’’
> ‘‘Respectful treatment and fair compensation for employees at all levels’’
What are the characteristics of a culture with Leadership Effectiveness?
> ‘‘Ethical culture starts at the top and is conveyed by example’’
> ‘‘Senior management demands ethical conduct at every level of the company’’
> ‘‘CEO and senior management live their lives with great personal integrity’’
> ‘‘When ethical issues arise, CEO does not ‘shoot the messenger,’ but gathers facts and takes action’’
> ‘‘Do what they say they’re going to do’’
What are the characteristics of a culture with Process Integrity?
> ‘‘Dedication to quality and fairness in its people, processes, and products’’
> ‘‘Invest in ongoing ethics training and communication throughout the organization’’
> ‘‘Values are reinforced in performance appraisals and promotions’’
> ‘‘Values are reinforced in every-day execution’’
> ‘‘Excellent corporate governance processes, supported by Board quality and independence’’
> ‘‘Noble mission is internalized in company processes and behavior’’
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‘Transparent decision-making by the people closest to the question’’
What are formal systems that reinforce ethical frameworks?
LVS COPAD
FORMAL SYSTEMS Executive Leadership Mission, Values Selection system Codes/ Policies Orientation/ Training Performance Management Authority Structure Decision processes
what are informal systems that reinforce ethical frameworks?
MNRML
INFORMAL SYSTEMS Role Models/ Heroes Norms Rituals Myths/ Stories Language
What are characteristics of a firm with value based goals?
More far-sighted and flexible
> What are our values?
> Who do we want to be?
> What kinds of behaviours do we want to support?
Reinforce a particular set of values rather than a particular set of rules.
> Values-based organizations have codes of conduct
codes are rooted in a statement of values and it is presumed that the code includes examples of the values’ application.
Focus on:
> Maintaining brand and reputation.
> Recruiting and retaining desirable employees.
> Helping to unify a firm’s global operations.
> Creating a better working environment for employees.
> Doing the right thing in addition to doing things right.
What are characteristics of a firm with compliance based goals?
The traditional approach – policies, rules, regulations
Emphasize obedience to the rules as the primary responsibility of ethics.
Empower legal and audits offices to mandate and monitor compliance with the law and with internal codes.
Meeting legal and regulatory requirements.
Minimizing risks of litigation and indictment.
Improving accountability mechanisms.
What is the argument in favor of a values based organization?
The argument in favor of a values-based culture:
A compliance culture is only as strong and as precise as the rules with which workers are expected to comply.
A values-based culture recognizes that where a rule does not apply, the firm must rely on the personal integrity of its workforce when decisions need to be made.
