Unit 6

Organizational culture
and change

Organizational Culture

A system of shared values, assumptions,

beliefs, and norms that unite the members of
an organization.
Reflects employees views about the way
things are done around here .
The culture specific to each firm affects how
employees feel and act and the type of
employee hired and retained by the
company.
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Organization culture is the set of values that

helps the organizations employees
understand which actions are considered
acceptable and which are unacceptable .

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Levels of Corporate
Culture

Visible
Culture
Expressed
Values

Core
Values

5-4

What Do Cultures Do?

Cultures
CulturesFunctions:
Functions:
1.1. Defines
Definesthe
theboundary
boundarybetween
betweenone
oneorganization
organizationand
andothers.
others.
2.2. Conveys
Conveysaasense
senseofofidentity
identityfor
forits
itsmembers.
members.
3.3. Facilitates
Facilitatesthe
thegeneration
generationofofcommitment
commitmenttotosomething
somethinglarger
larger
than
thanself-interest.
self-interest.
4.4. Enhances
Enhancesthe
thestability
stabilityofofthe
thesocial
socialsystem.
system.
5.5. Serves
Servesas
asaasense-making
sense-makingand
andcontrol
controlmechanism
mechanism for
forfitting
fitting
employees
employeesininthe
theorganization.
organization.
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How Culture Begins

Founders hire and keep only employees who

think and feel the same way they do.

Founders indoctrinate and socialize these

employees to their way of thinking and feeling.

The founders own behavior acts as a role

model that encourages employees to identify
with them and thereby internalize their beliefs,
values, and assumptions.
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Keeping Culture Alive

Selection
Concern 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

organizations culture.

the
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Stages in the Socialization Process

Pre-arrival Stage
The period of learning in the socialization process that
occurs before a new employee joins the organization.

Encounter Stage
The stage in the socialization process in which a new
employee sees what the organization is really like and
confronts the possibility that expectations and reality may
diverge.

Metamorphosis Stage
The stage in the socialization process in which a new
employee changes and adjusts to the work, work group,
and organization.
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Creating and Sustaining Organizational

Culture
Cultural Symbols

Company Rituals
and Ceremonies
Company Heroes

Stories

Organizational
Policies and
Decision Making

Language
Leadership
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How Employees Learn Culture

Stories
Stories
Rituals
Rituals
Material
MaterialSymbols
Symbols
Language
Language

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Managing Organizational Change

Organization culture can facilitate or inhibit

change in an organization.
A firm attempts to change organizational
culture because the current culture hinders
the attainment of corporate goals.
Environmental and internal forces can
stimulate the need for organization change.

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Forces for Change: Environmental Forces

Put pressure on how a firm conducts its

business and its relationships with
customers, suppliers, and employees.
Environmental forces include:
Technology
Market

forces
Political and regulatory forces
Social trends
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Forces for Change: Internal Forces

Come from decisions made within the

company.
May originate with top executives and
managers and travel in a top-down direction.
May originate with front-line employees or
labor unions and travel in a bottom-up
direction.

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Resistance to Change
Self-Interest
Cultures that
Value Tradition
Different
Perspectives and
Goals

Lack of Trust and

Understanding
Uncertainty

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Lewins Three-Step Model of Organizational

Change

Unfreezing

is the process
by which people
become aware
of the need for
change

Change:

movement
from the old
way of doing
things to a
new way

Refreezing:
is the process of
making new
behaviors
relatively
permanent and
resistant to
further change

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Implementing Organizational Change

Top-down Change
Change Agents

Bottom-up Change
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Change agents should take the following steps

to obtain a successful change outcome:
1. Establish a sense of

5. Empower others to

urgency.
2. Form a powerful
coalition of supporters
of change.
3. Create a vision of
change.
4. Communicate the
vision of change.

act on the vision.

6. Plan and create shortterm wins.
7. Consolidate
improvements and
produce still more
change.
8. Institutionalize new
approaches.
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Tactics for Introducing Change

Communication and
Education

Employee
Involvement

Negotiation

Coercion
Top-Management
Support
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Managing successful organization

change and development.

Consider international issue

Take a holistic view
Start small
Secure top management support
Encourage participation
Foster open communication
Reward contributors
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Key

impact

Consider international issue

Keeps in touch with the latest global

developments and how change is
handled in different cultures

Take a holistic view

Helps anticipate the effects on the social

system and culture

Start small

Works out details and shows the

benefits of the change to those who
might resist.

Secure top management support

Gets dominant coalition on the side of

change: safeguards structural change,
heads off problems of power and control

Encourage participation by those Minimizes transition problems of control,

resistance and task redefinition
affected by change.
Foster open communication

Minimizes transition problems of

resistance and information and control
systems

Minimises
transition
Reward
contributors
Copyright
2002 by The McGraw-Hill Companies,
Inc. All rights
reserved. problems of

5-20

Organizational development
---ORGANIZATION DEVELOPMENT: It is the process of planned
change and improvement of the organization through application
of knowledge of the behavioral sciences
-----OD is the systematic application of behavioral science
knowledge at various levels, such as group, inter group,
organization, to bring about planned change.
----Their objective is a higher quality of work life, productivity,
adaptability and effectiveness. It accomplishes this by
changing attitudes, behaviors, values, strategies,
procedures and structures so that the organization can
adapt to competitive actions, technological advances and
the fast pace of change within the environment .
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QUALITY OF WORK LIFE: is the extent to which

workers can satisfy important personal needs
through their experiences in the organization

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