Lecture Organisational Culture

What is organisational culture?

How do organisational cultures differ?
What is organisational culture?

• a sense of identity
• a sense of belonging
• a sense of security
• a guide to behaviour
• a shared set of beliefs
• simplification of decision making
• indication of organisations beliefs

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Robbins (2001)
Describes organisational culture as a difficult and
complex idea stating:

“I can’t define it, but I know it when I see it’

Something not consciously aware of - still inescapable influence on

behaviour

A socially constructed phenomenon

Now a popular term but still confusion about what it really means

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Some definitions of organisational culture
Becker & Geer (1970)
Set of common understandings, expressed by language

Ouchi (1981)
Set of symbols, ceremonies & myths that communicate the underlying values & beliefs of the
origin, to its employees

Swartz & Jordan (1980)

Pattern of beliefs & expectations shared by members that produce norms shaping behaviour

Cooke & Rosseau (1998)

The ways of thinking, behaving and believing that members of a social unit have in common

Goldstein (1983)
A set of beliefs about what is appropriate and inappropriate organisational behaviour

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Therefore ...
Creates organisational
traditions
Amsa (1986)

The way we do things Considered collective

around here. programming of the
mind
Deal and Kennedy
(1982) Hofstede (1991)

Instils widely shared

assumptions
Gordon (1991)

Myers, Hulks and Wiggins, Chapter 6

The importance of organisational culture

"I came to see, in my time at IBM,

that culture isn’t just one aspect of
the game it is the game.”

Lou Gerstner (2003)

Former Chairman and CEO of IBM

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 Schein (1986):
“Culture controls the manager ..through the automatic filters that
bias the manager’s thoughts and feelings. As culture arises and
gains strength, it becomes pervasive and influences everything
the manager does, even his own thinking and feeling. (sic)…most
of the elements that the manager views as aspects of ‘effective
management’ - setting objectives, measuring, following up,
controlling, giving performance feedback and so on - are
themselves culturally biased to an unknown degree in any
organisation…. There is no such thing as a culture-free concept of
management”

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 Schein (2004): Inter-related Levels of Culture
Happy employee is a
productive employee

Good relationships;
having fun; work-life
balance

Open door policy; first

name basis; staff
communal areas; social
activities; flexible
working

Myers, Hulks and Wiggins, Chapter 6

 Activity:
Over the next few slides are extracts from an article profiling a company

Can you:

a. Identify the company?

b. Identify the observable (artifacts) and invisible (values and

assumptions) aspects of culture?

c. What do they suggest about the culture in this company?

Myers, Hulks and Wiggins, Chapter 6

• I've just stepped inside the offices of [company name] To one side
there's a huge flat screen TV that staff can use to play videogames
during their breaks; in one corner stands a lonely red British telephone
box; a pair of life-sized, green plastic deer stand in another, for no
discernible reason.
• If you didn't know any better, you might guess that this company
wasn't doing too well. It's so quiet that it feels like it could be the
weekend – the only real noise is the murmur coming from a trio of
workers, laptops out, sitting on a sofa in the corner.
• "We have to stay focused on what we're working on and not to get too
caught up in the spotlight," says [person’s name] (the 36-year old
creative director). "There's a knowledge that these things go up and
they come down again. No matter what, we'll just keep working on
trying to make [product/service] better . . . we like to have fun and
stay humble."

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• In one meeting room, there's a photograph of rap mogul Sean ‘P Diddy’
Combs, taken in the building's lift one day after he turned up to
express his gratitude and excitement.
• Part of his job, the Creative Director says, is to try to help everyone at
the company keep these things in perspective – making sure that
[company name] does not become a gang of egotists who gloat over
their status as part of the Next Big Thing, but instead maintains a
"general level-headed, unassuming, humble, humorous, funny
atmosphere".
• "We focus a lot on culture specifically at [company name] because of
this spotlight," he says. "We don't want to end up like the child actor
who found success early and grew up all weird and freaky. We want to
remain OK; just because we found success early and in many ways got
lucky doesn't mean we're all a bunch of geniuses. It means what it
means."
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• This all means that staying simple and understated is not an accident,
but a philosophy. As a result, no one in the team could be described as
flashy: the Creative Director, like most of the company's employees
dresses in a T-shirt, carefully messed-up hair and black-rimmed glasses.
• "There's a lot we can learn from smart people out in the world. One of
the things I like so much about President Obama is his vision that it's
not a zero-sum game, where one country is going to win the game of
earth. That fits with [company name]."
• "Everything about [company name] goes faster," the Creative Director
says. "It's grown faster, we move faster . . . any decision you think
we're going to need to make two years from now, we'll probably have to
make it tomorrow."

Myers, Hulks and Wiggins, Chapter 6

 Did you guess the company correctly?

http://www.guardian.co.uk/technology/2009/jul/15/twitter-headquarters-biz-
stone

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Robbins (2005)

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Handy (2003) – Based on Organisational
Design

POWER ROLE

TASK PERSON

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• Dennison (1989) – Culture, Strategy & Environment

o Adaptability
o Mission
o Consistency
o Involvement

• Goffee and Jones (1998) – The Double S Cube

o Networked
o Communal
o Fragmented
o Mercenary

Myers, Hulks and Wiggins, Chapter 6

 Reynolds (1986) Hofstede’s Dimensions
• internal / external focus • process / results oriented
• task / social focus • employee / job oriented
• safety / risk • parochial / professional
• conformity / individuality • open / closed system
• individual / group rewards • loose / tight control
• centralised / decentralised decision making • normative / pragmatic
• ad hocery / planning
• stability / innovation
• Co-operation / competition
• simple / complex organisation
• informal / formalised procedures
• high / low loyalty
• ignorance / knowledge of organisational
expectations

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Sources of Organisational Culture
• the national culture (Hofstede, 1991)

• the vision, management style and personality of the founder or

other significant dominant managers (see, for example, Schein,
1985)

• the nature of the business, the type of products and the

environment within which the organisation operates (see, for
example, Gordon, 1991)

• manager behaviour and work practices

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 Recruitment,
Selection,
Retention

Founder
Values and Induction and
Preferences Socialisation
Early Values, Organisational
Goals, Culture
Assumptions
Industry Leadership
Demands

Reward
Systems

Culture Creation Culture Maintenance

Myers, Hulks and Wiggins, Chapter 6

Early Years Recruitment,
Selection,
Retention

Founder
Values and Induction and
Preferences Socialisation
Early Values, Organisational
Goals, Culture
Assumptions
Industry Leadership
Demands

Reward
Systems

Culture Creation Culture Maintenance

Myers, Hulks and Wiggins, Chapter 6

 http://www.youtube.com/watch?v=oJCuYNvrE8g

Myers, Hulks and Wiggins, Chapter 6

Industry Demands Recruitment,
Selection,
Retention

Founder
Values and Induction and
Preferences Socialisation
Early Values, Organisational
Goals, Culture
Assumptions
Industry Leadership
Demands

Reward
Systems

Culture Creation Culture Maintenance

Myers, Hulks and Wiggins, Chapter 6

How is culture developed and
maintained? Recruitment,
Selection,
Retention

Founder
Values and Induction and
Preferences Socialisation
Early Values, Organisational
Goals, Culture
Assumptions
Industry Leadership
Demands

Reward
Systems

Culture Creation Culture Maintenance

Myers, Hulks and Wiggins, Chapter 6

Johnson, Scholes and Whittington
(2008)
Stories
Rituals
and Symbols
Routines
The
Paradigm
Control
Systems Power
Structur
e

Myers, Hulks and Wiggins, Chapter 6

Organisational Subcultures
Functional
• Marketing
• Production
• Financial
• Professional/technical etc

Geographical
• Subsidiaries in different countries/regions
• Head office vs the rest

The Generation Gap

• “Old guard” vs “Young turks”

Old & New

• Core business vs recent acquisitions

Myers, Hulks and Wiggins, Chapter 6

Culture Strength
Intensit
y of
Feeling Strong
Cultur
e

Weak
Cultur
e

Strength
of
Consensu
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Influence of a Strong Organisational
Culture
Social
Control

Strong
Social
Organisational
Glue
Culture

Improves
Sense-Making
McShane and Von Glinow (2009)

Myers, Hulks and Wiggins, Chapter 6

Culture Strength and Fit

Moderately Strong Culture = Corporate

Performance

• Dell’s “winning” culture, which

emphasized cost efficiency and
competitiveness, became more
of a liability as the market
moved toward a preference for
style and innovation

Myers, Hulks and Wiggins, Chapter 6

Adaptive Cultures
• Organizations are more likely to succeed when they have an adaptive culture.
• An adaptive culture focuses employees on the changing needs of customers and other
stakeholders, and supports initiative and leadership to keep pace with these changes.
• An adaptive culture is focused outwardly rather than inwardly. This means that senior
executives are more interested in the satisfaction of customers and others than in
their own well-being.
• The underlying mental model is that the organization will survive and succeed through
continuous change.
• Organizations with adaptive cultures are readily identifiable by their uncanny ability to
shift directions with the market. Nokia has moved from toilet paper and rubber boots
to cellular telephones. Hewlett-Packard has shifted from engineering instruments to
computer systems and peripherals. Each of these firms has maintained an adaptive
culture in which employees believe that change is a necessary and inevitable part of
organizational life.

Myers, Hulks and Wiggins, Chapter 6

Therefore ...

McShane and Von Glinow (2009)

Myers, Hulks and Wiggins, Chapter 6

Organisational Culture & Change

Culture relates to change in two ways:

1. You want to implement a change within an organisation – you

need to consider the culture

2. The culture itself needs to change

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Four Potential Options ...
• Ignore the culture – High risk, potential resistance

• Manage around the culture – Real possibility, identify the barriers that the
culture might present to the change you’re trying to implement, look for
alternative ways to achieve your change without having to address these
barriers

• Try to change the culture to fit the change you are implementing

• Modify the change you are implementing to fit the culture – e.g. reduce the
performance expectations

Myers, Hulks and Wiggins, Chapter 6

 Conclusion
• The concept of culture is complex

• There is not an optimum culture for an organisation

• Even the strongest of cultures, sub-cultures inevitably exist within

them

• In relation to change, managers may have to:

o Consider culture in implementing change

o Consider culture as the target to be changed

Myers, Hulks and Wiggins, Chapter 6

 References
• Mavondo, F. and Farrell, M. (2003). Cultural orientation, its relationship with market orientation,
innovation and organisational performance. Management Decision, 41 (3), 241-249.
• Martins, E.G. and Terblanche, F. (2003). Building organizational culture that stimulates creativity
and innovation. European Journal of Innovation Management, 6 (1), 64-74.
• Ogbonna, E. and Wilkinson, B. (2003). The false promise of organizational culture change: A case
study of middle managers in grocery retailing. Journal of Management Studies, 40 (5), 1151-1178.
• McShane, S.L. and Von Glinow, M.A. (2009). Organizational Behavior: Essentials. New York:
McGraw-Hill Irwin
• Rashid, Z.A., Sambasivan, M. and Johari, J. (2003). The influence of corporate culture and
organisational commitment on performance. Journal of Management Development, 22 (8), 708-
728.
• Schein, E. H. (1992). Organizational culture and leadership. San Francisco: Jossey-Bass
• Shook, J. (2010). How to change a culture: Lessons from NUMMI. MIT Sloan Management Review,
51(2), 62-68.
• Smith, M. (2003). Changing and organisations culture: Correlates of success and failure.
Leadership and Organizational Development Journal, 24, 249-260.

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