Term Paper on Organizational Culture

Kathmandu University School

Of Management
Balkumari, Lalitpur

Term Paper on Organizational Culture

Date: 30th June, 2016

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Term Paper on Organizational Culture

Contents
Introduction................................................................................................................ 3
Literature Review....................................................................................................... 4
Organizational Culture in Real Organizational Context...............................................6
Organizational Culture in Nepal.................................................................................. 8
Problems/Issues Regarding Organization Culture.....................................................11
Implications.............................................................................................................. 13
References................................................................................................................ 15

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Introduction
An executive, when asked what he thought about organizational culture, said, I cant define it,
but I know it when I see it. However, to better understand what organizational culture is and its
importance in any organization, we can define it as a system of shared meaning held by the
members which defines how the organization does its job and also distinguishes one organization
from other organizations. The primary characteristics of an organization which captures the
culture of the organization as a whole are:

Innovation: It is the degree to which the employees in an organization are encouraged

to take more risks and be innovative.

Attention to detail: This characteristic defines the degree to which the employees of

an organization are expected to be precise and accurate in their work.

Outcome orientation: It defines the degree to which the organization focuses on the
results and outcomes achieved rather than the techniques and processes used to gain

the results.
People orientation: This characteristic dictates the degree to which the management
takes into consideration the effects on the people of the organization while making

decision.
Team orientation: It is the degree to which work activities are organized for teams

rather than assigning individual tasks.

Aggressiveness: It defines whether the members are expected to be assertive or

easygoing when dealing with their competitors in the marketplace.

Stability: This characteristic separates organization on whether the organization
emphasizes on maintaining the current position or strives for growth.

Being a social animal, we, humans, are always a part of a group, an organization or something
which includes the involvement of other people around us. Being a part of a group or an
organization, it is important for all individuals to learn the culture, the value and beliefs of the
organization to be a part of that organization. As one organization is different from the others, an
individual, to blend in with the other members of the organization, knowing the organizations
culture is important. Organization culture provides individuals with a sense of identity and gives
individuals the feeling that they belong to something larger and also enhances the commitment of
individuals towards the overall organizational goals. Lastly, culture in any organization is
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important because culture is acts as a control mechanism which shapes the attitudes and
behaviors of the members.

Literature Review
According to Rousseau (2000), Organizational Culture is defined as a set of commonly
experienced stable characteristics of an organization which shows the distinctive features of an
organization which differentiates it from others. Rousseau (2000) also defines the organizational
culture as set of norms and values that are shared by individuals and groups across the
organization. Organizational values and beliefs refer to the common ideas about what the shared
goals of an organization are, what types of behavior should the members of an organization
follow in order to achieve the common goals of an organization. These organizational values in
turn form out the standard norms and guidelines for the organization that makes it distinct from
others.
An article Organizational Culture and Employee Performance by Julie Davoren states that
Organizational culture defines the way employees complete tasks and interact with each other in
an organization that is, it integrates the workforce in an organization with the same values,
beliefs and rituals that further help them to have a clear direction of where the organization wants
to be and what they should do to take it there. It also states that, In times of change, the biggest
challenge for any organization may be to change its culture, as the employees are already
accustomed to a certain way of doing things which also explains why many of the conglomerate
consisting of mergers with different organizational culture do not perform really well. Example
could be of Kraft taking over Cadbury. The article has further explained the types of culture that
might be dominant in an organization stating clearly that it depends mainly on the environment
that the organization operates in i.e. in a high power distance environment the culture is of
extensive controls over subordinates and vice-versa. The article has further explained the need of
a strong organizational culture for the better performance and motivation of the employees and
that they need to be involved in the goal-setting of the organization as employees work harder
to achieve organizational goals if they consider themselves to be part of the corporate culture
(Julie Davoren, n.d.).

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According to Mark Miller in his article What Is Corporate Culture and How It Affects
Performance, Organizational Culture is the amalgamation of values, vision, mission, and the
day-to-day aspects of communication, interaction, and operational goals that create the
organizational atmosphere that pervades the way people work which is similar to the definition
given in the above mentioned article i.e. Organizational culture is something that guides and
gives a clear vision to the worker in an organization of what they need to do. This article also
states that organizational culture is a very hard term to define and even harder to put into action
because it requires devotion to ones work and not just change the physical setting of the
organization. According to the article an organization is simply a group of individuals working
towards a goalthe generation of corporate culture, therefore, stems from the individuals who
make up the organization, from leadership to the front-line workers(Mark Miller, n.d.). This has
further supported the writers stance on organizational culture binding the workers in achieving
the goal as they are involved in the development of their organizational culture. Furthermore, the
article has also stated that Corporate culture is an ongoing system of checks and balances that
needs to be reinforced at all levels of the organizational and employee life cycle. This
emphasizes the fact that organizational doesnt work just by setting some standards in an
organization and asking everyone to follow it but it needs to be implemented and reminded again
and again. Moreover, in this process the organization needs to make sure that it hires employees
that match the values shared by the organization also known as person-organization fit.
The concept of organizational culture has become popular since the advent of 1980. The rising
interest and attention in the topic has given creation to various definitions of organizational
culture and perspective on the topic. Organizational culture has been defined as set of shared
values, beliefs, and norms that influence the way the employees think, feel, and behave in a
workplace (Schein, 2011). According to Schein (1989), culture is a coherent system of
assumptions and basic values, which distinguish one group or organization from another and
orient its choices. Hence, organizational culture implies a pattern of basic assumptions
invented, discovered, or developed by a given group as it learns to cope with its problems of
external adaptation and internal integration that has worked well enough to be considered valid
and, therefore, to be taught to new members as the correct way to perceive, think, and feel in
relation to those problems (Schein 1989, p. 9). Since they have used the assumptions to solve
their problems and it worked effectively, they accepted the assumptions as valid and hence they
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teach these assumptions to the newly recruited members about the organization and its basic
ways of thinking, perceiving and approaching any problem.
There is another view point about organizational culture from Robbins (1996) who defines
organizational culture as a uniform perception of an organization which has common
perspectives. The author wants to depict that organizational culture is a descriptive term and be
used to distinguish one particular organization from the other. One of the important point made
by the researchers during the investigation of the topic was culture is a dynamic, evolving
process and is not static. Morgan (1986) explains that culture must be understood as a living
phenomenon through which people create their world. Schein (1989) has argued that
organizational culture change over time. Both the views consider the few key individuals have an
important role in shaping and refining the culture.
However, it should be noted that despite having various definitions and views on organizational
culture from different authors, the one common thing among all is that it is the shared nature of
beliefs, norms etc. Thus, this paper attempts to examine why organizational culture is regarded
so important and valuable.

Organizational Culture in Real Organizational Context

Organizational culture has been defined as the stable system of set of values, beliefs, norms and
assumption that exist and persist overtime within any organization. However, it is a difficult and
time consuming process to understand an organizational culture of an organization for an
outsider and this requires extensive research on part of the organization and the employees
working there. Also learning about the culture of one organization doesnt necessarily help us to
understand the culture of other organization. The culture varies from country to country and
organization to organization. To be crystal clear about what organizational culture actually is lets
look for the evidences of this practice in real organizational context.
Apple is a leading technological company and one of the most successful companies today.
Many people seem to express their enthusiasm when they hear the success story of Apple. The
secret to its success story is known to be its organizational culture. Its culture is what has helped
the company to groom and reach to this height today. Apples organizational culture facilitates
rapid innovation. Apple's official slogan used to be Think Different, and not without reason.
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Employees are effectively developed and integrated into an organizational culture that helps
them to gain an innovative vision.
Apple also supports inclusion and diversity as diversity is critical to innovation. They believe in
equality for everyone, regardless of race, age, gender, gender identity, ethnicity, religion, or
sexual orientation (Tim Cook, n.d.).
One unique culture that Apple has is secrecy. The members are not to talk about Apple.
Simon Woodside, program manager in Core OS, talks about the secrecy policy while he was
working on a side- project. Personally, I didn't talk either ... my close friends and family knew I
was working on some secret project but they didn't find out what until Steve himself made the
announcement. Apple had total control of the message. The secrecy paid off big time for the
company." The culture of secrecy had helped the company keep the demand high for existing
products still on shelves as protect the business from corporate espionage.

At Zappos, another leading company, the culture is about more than money. The culture is all
about delivering happiness. Its not only about the customers happiness but the employees
happiness as well. The members of Zappos are encouraged to be themselves as they believe
creativity generates when people are comfortable being themselves. Zappos focus more on
customer satisfaction and dedication rather than efficiency. There are dozens of stories about
their outstanding customer service, including delivering flowers to a customer whose mom
passed away and talking to a customer for over 8 hours. They want to be known and remembered
as the best customer service and customer experience company rather than a shoe selling
company. Listed below are the ten core values that the members of Zappos live by:

Deliver WOW through Service

Embrace and Drive Change

Create Fun and A Little Weirdness

Be Adventurous, Creative, and Open-Minded

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Pursue Growth and Learning

Build Open and Honest Relationships With Communication

Build a Positive Team and Family Spirit

Do More With Less

Be Passionate and Determined

10 Be Humble
(About Zappos Culture, 2009)
The combination of all these core cultures supports the firms industry leadership. These key
characters helps Zappos stand out and stay ahead of its competitors enabling the company to
keep growing. Sticking to its organizational culture especially at a time when many companies
are scaling back and outsourcing, has helped the company capture value from its customers as
well as keep the employees satisfied. Today, Zappos' success story is one that has been recounted
many times. And Tony, the CEO of the company, credits this success to the firms organizations
culture of remarkably focusing on customer service and culture.

Organizational Culture in Nepal

I feel that we lack that fire in the belly and go get attitude. We are happy with mediocrity and
dont pursue perfection in our Corporate Culture. But we are getting more competent with time
and sure in years to come we will be up there with the global giants and the best of the best.
Mr. Saurabh Jyoti, Director of Jyoti Group
In Nepal, management practices are still in their traditional forms, so is the organizational
culture. Many business organizations are family owned and, therefore, there is lack of a
professional management system. They are unable to develop a corporate culture. In government
offices, management practice is affected by bureaucracy. Government employees lay
unnecessary emphasis on rules, regulations, procedures and legal formalities while providing
service to the people. And at times they tend to interpret government rules and policies
differently so as to shy away from their responsibilities.
However, some organizations like banking, insurance, hotel, airlines, communication, joint
venture and multinational companies are in the process of introducing modern management

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systems because of the development of competitive environment. The following are the cultural
practices found in Nepalese organizations.

Planning
Planning in Nepalese enterprises is based on age old traditions. Many managers do not consider
past achievements and reliable data to prepare plans. They prepare plans on the basis of their
personal intuition and judgments. They prepare plans only to meet short term objectives of the
formulated without analyzing the impact of environment. SWOT analysis is not taken into
consideration. The major problem in Nepalese organizations is to implement the plans. Plans are
prepared by the top level management without incorporating the opinions and suggestions of
subordinates. Therefore, subordinates feel irresponsible to implement plans
Decision making
There is centralized decision making practice in many Nepalese organizations. Decisions are
taken by the top level management without participation of the subordinates. The top level
managers do not want to delegate the decision making authority to the subordinate levels. They
do not trust their subordinates even if they are capable and sincere. Subordinates are enforced to
implement the decisions without proper instructions and guidance. Generally in private
organizations, decision is taken on family pressure whereas in government organizations it is
taken on political pressure. Quantitative tools for decision making are rarely found in practice. In
the decision making process, more importance is given to fulfill individual interest rather than
organizational interests. Many managers do not take decisions in time. They take decisions only
in emergency situations. In government organizations committee are formed to solve the
problems, but the committees recommendations are rarely implemented.
However, with the development of competitive environment in business, managers of some
private enterprises have started to consider both qualitative and quantitative aspects of decisions.
As far as possible they try to take rational decisions.
Organizing

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Many Nepalese organizations have traditional vertical organizational structure. In development

projects, matrix structure is also practiced. Organizational structure is divided into different
departments on the basis of functions. There is a division of work, but authority and
responsibility is not clearly defined. Authority is highly centralized. Decisions are delayed due to
improper delegation of authority. Lack of accountability among the members has resulted in
wastage of organizational resources and efforts. The concept of teamwork and group effort is not
developed. There is no proper coordination among members of different departments.
Human resource management
Human resource management practice of Nepal is in its traditional form. Many organizations still
do not prepare human resources plan. The manpower requirement is estimated either on past
experience or on ad hoc basis. There is no proper system of job analysis and job description in
many organizations.

In private organizations, the main source of recruitment is relatives and friends. In corporate
houses, there is a system of publishing advertisements for recruitment of staff, but for
appointments, importance is given to reference and recommendations. In government offices, the
Public Service Commission openly announces vacancies for recruitment. It selects employees on
the basis of written test and interview.
In public enterprises the top level management is appointed on the basis of political ideology.
Similarly, junior level staffs are also appointed on political pressure.
In many organizations, experience, interest and skill of the staff are generally not taken into
consideration for placement in the job. However, in corporate organization the concept of
placement of right person to the right job is practiced. Similarly, emphasis is not given to
development of human resource skills. Development programs like training, workshop, seminar
etc. are rarely organized.
Controlling
Many managers in Nepal have a traditional view of control. They view control as a tool to issue
threats and penalize employees. Control mechanisms are not based on plans. Setting rational
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standards and measuring actual performances against the predetermined standard is rarely
practiced. In government offices, the annual budget is regarded as pre control, while the final
audit is regarded as financial control. More emphasis is laid on post control rather than pre
control. Managers do not show seriousness in quality control. Control is regarded as the
responsibility of the top management due to the highly centralized authority structure.
Management audit and performance audit is not in practice.
Apart from the influence of organizational culture through the viewpoint of management
practices, organizational culture of Nepali and western countries can be compared on following
basis:
Comparison

Organizational culture (Nepal)

Organizational culture (Western

Punctuality

Time is sometimes

countries)
Time is really prioritized.

Working environment

compromised.
Team/Group work is

Individualistic Approach.

prioritized. People emphasis on

People are within themselves.

working together, teaming up.

Decision Making

Due to hierarchical issues the

Its fast as everybody knows

decision takes time to be taken.

what their job is, and they work

accordingly.

Problems/Issues Regarding Organization Culture

Common organizational culture problems can include:
I.
II.
III.
IV.

Ambiguity
Inconsistency
Poor Communication
Involvement of team members

i) Ambiguity is a common issue. Employees may not understand what is expected of them, or
could feel as though stated policies are in conflict with actual practices. For example, workplace
policies may state that management supports a healthy work-life balance, but the company may
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only promote single people who are willing to work long hours without complaint. The stated
claim is that the company is family friendly, but in reality, this is not the case.
ii) Inconsistency: Here, Employees may feel like policies are not applied evenly and fairly;
managers may not be penalized for activity employees would expect to see punished, for
example. Companies may also be inconsistent across departments, which can contribute to the
development of resentment. People in human resources, for example, might want to know why
the information technology department has better offices or always seems to be on vacation.
iii) Poor communication is another common problem with organizational culture at companies
of all sizes. Employees may not communicate well with each other and could feel uncomfortable
about approaching supervisors with ideas, suggestions, and concerns. From the top down,
companies might not clearly articulate expectations and goals, which can make staff members
confused about what they are supposed to be doing. (What Are the Most Common
Organizational Problems?)
iv) Involve all team members Culture needs to be integrated in a natural way to
ensure everyone feels they are part of the process. It is essential for organizations growth and
success that everyone be moving in the same direction. It creates a sense of togetherness in
strong culture and a feeling of a team.
Other organizational culture problems can include differences in priorities, Poor leadership etc.
These can contribute to the experience of a hostile and unpleasant workplace, which can make
workers less loyal and may contribute to issues like harassment, bullying, and high turnover.

Implementation of Organizational Culture

Companies that know they have organizational culture problems can define them, creating lists
of examples to understand the specifics of the issues that must be addressed. With this
information in hand, they can start to address the situation. For example, if a company's goals are
ambiguous, leadership can meet up to discuss what the company wants to do and how it wants to
accomplish it. This information can be communicated to company personnel so they feel more
comfortable.
Companies with concerns about their structure and organization can use outside consultants to
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get a fresh look at their culture, and may also want to consider the use of employee evaluations
to get feedback from their personnel. These tools can help companies identify and address
problems with organizational culture. (Cindy Boisvert, n.d.)

Implications
Organizational culture creates a number of various concepts, strategies and situations which
affect every level of planning when it comes to any type of hierarchical institution. The
implications of organizational culture apply to companies, corporations, charitable organizations,
governments, and even sports teams/organizations.
Managers are charged with managing the resources of organizations to fulfill the objectives of
the organization. Their ability to do this is significantly influenced by the prevailing culture of
the organization. Efforts to change the organization is a function of the business environment
faced by the organization, the values or norms of behavior shared by members of the
organizations, the individual identified and held up as heroes by the organization, the rites and
rituals employed by the organization to reinforce the values or norms of behavior, and
communications, the management of the cultural network that sustains the culture. By
developing an understanding of an organization's culture, organizational leaders can manage the
culture to improve organizational performance.
Employee form an overall subjective perception of the organization based on factor such as
degree of risk tolerance, team emphasis, and support of people. This overall perception becomes,
in effect, the organization culture and affect the employee performance and satisfaction, with
stronger culture having a greater impact.
So, it is very difficult to change the organizational culture overtime as peoples personalities tend
to be stable overtime, so too do strong cultures (S.P. Robbins & T.A. Judge, p.533). While setting
the organizational culture, a manager should be very careful treating their organizations culture
as relatively fixed in short term. Hiring individual whose values match with those of organization
is also very important. A manager should be very careful in the selection process because hiring
individual whose values dont align with those of the organization may lead to lack of
motivation, commitment toward work, reduced performance and increased turnover.

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Also, performance of employee depend on knowing what to do and not to do. So, a manager
should develop the culture that focuses on socialization. Though the implementation of culture in
organization is different but it is found that those organization that focus on socialization have
greater performance than other because they respect individual value creating the environment of
self-motivation. A manager should create an ethical culture and consider spirituality and its role
in creating a positive organizational culture.
Managers should always try to enhance opportunities and reduce threats. Different culture suits
different types of organization. For example, innovation and risk taking culture is more useful in
technological company, attention to detail is more useful in hospitality sector, and people
orientation is more useful in service sector and so on. There is positive link between
organizational culture and employee satisfaction and employee satisfaction and performance.
Performance level of organization helps managers understand whether their organizational
culture is working effectively or not. If managers find that there is problem in the culture, then,
they should take corrective actions. Organizational culture should be flexible, it should be able to
cope with changing need of employee and the business environment.
Culture, particularly in large organizations that have a great deal of internal momentum, can be
difficult to influence or change. The size of an organization and the strength of its culture are the
biggest contributors to cultural inertia. Big and strong organizational cultures will have a
powerful tendency to continue moving in the direction they are already moving in. Therefore,
managers must understand not only how to create culture, but also how to change it when
necessary to ensure a positive, efficient and ethical culture.
Hence, when different cultures come together, it is wise to expect some degree of cultural-clash
and differences of opinion. Managers, particularly upper management, must be aware of the
implications of cultural change, the facets of organizational culture and the steps involved in
altering it.

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References

Rousseau, D. M. (2000). Assessing organizational culture: The case for

multiple methods. In B. Schneider (Ed.), Organizational climate and culture.
San Francisco: Jossey-Bass.
Julie Davoren, (n.d.). Retrieved from
http://smallbusiness.chron.com/organizational-culture-employee-

performance-25216.html
Mark Miller, (n.d.). Retrieved from

https://www.emergenetics.com/blog/corporate-culture-affect-performance/
What Are the Most Common Organizational Problems? Retrieved from
http://www.wisegeek.com/what-are-the-most-common-organizational-culture-

problems.htm
Cindy Boisvert. (n.d.). Retrieved from https://atmanco.com/blog/working-

environment/organizational-culture-challenges/
Tim Cook, (n.d.). Retrieved from http://www.apple.com/diversity/
About Zappos Culture (2006). Retrieved from http://www.zappos.com/core-

values/
S.P. Robbins & T.A. Judge (2005). Organizational Behavior (15 th ed.) Upper
Saddle River, New Jersey. Pearson Education, Inc.

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