Organisational Culture

ORGANISATIONAL
CULTURE
Learning Objectives
• Ways in which organisational culture is formed and nurtured by top management

• Differences between organisation as an entity and organisation as a key management task
within firms
• Role of employees in developing and maintaining organisational culture
Introduction
Organisational Culture is:

■ The way we do things around here
■ Shared understandings and expectations
■ Norms, values, beliefs, and assumptions that influence how we think, feel, and act in
given contexts
■ Expressed in artifacts and symbols
■ Culture as a form of clan control
[Hatch, Mary Jo. Organization Theory]

Cultures and subcultures
Organizational
subcultures
Societal culture
Organizational cultures
(societal subcultures)
Organizational subcultures
■ Occupational (R&D, legal)

■ Work group (teams, branch offices)
■ Hierarchical (top mgt, middle, workers)
■ Previous affiliations (merger, acquisition, joint venture)
■ Siehl & Martin’s (1983) study
■ Enhancing (support corporate values)
■ Orthogonal (exist independently)
■ Counter (defy corporate values)
How Organisational Culture is Formed
Organisational cultures are created by a variety of factors, including:

■ Founders’ values and preferences
■ Industry demands, and early values
■ Goals, and assumptions.
Culture is maintained through attraction-selection-attrition, new employee onboarding,

leadership, and organizational reward systems.
Model Describing How Cultures Are Created and
Maintained
8.5 Creating and Maintaining Organizational Culture – Principles of Management (umn.edu)
Schein’s three levels of culture (Fig. 6.3)
[Hatch, Mary Jo. Organization Theory]

Artifacts of organizational culture
Category: Examples:
Objects Art/design/logo;
Buildings/décor/furnishings;
Dress/appearance/costume/uniform;
Products/equipment/methods;
Posters, photos, cartoons, signage.
Verbal Jargon/names/nicknames;
expressions Explanations/theories;
Stories/myths/legends/heroes/villains;
Superstition/rumors;
Metaphor/proverbs/slogans;
Speeches/rhetoric/oratory.
Hatch & Cunliffe: Organization Theory, 4th edition

Corporate values
Values espoused and promulgated by top management;
may or may not be widely held throughout the organization;
not to be confused with organizational values
Disney corporate values: Sony corporate values:
■ Wholesome American ■ Not following others (be a
values (Mom, apple pie) pioneer)
■ Creativity, dreams, ■ Doing the impossible
imagination ■ Individual ability and
■ Attention to detail creativity
■ Control of Disney magic ■ Joy and pleasure
Role of employees in developing and
maintaining organisational culture
■ As a company matures, its cultural values are refined and strengthened.
■ The early values of a company’s culture exert influence over its future values.
■ It is possible to think of organizational culture as an organism that protects itself from
external forces.
■ Organizational culture determines what types of people are hired by an organization and
what types of people are left out.
■ Moreover, once new employees are hired, the company assimilates new employees and
teaches them the way things are done in the organization. We call these
processes attraction-selection attrition and onboarding processes.
Attraction-Selection, Attrition and
Onboarding Processes
■ Organizational culture is maintained through a process known as attraction-selection-attrition
(ASA).
■ First, employees are attracted to organizations where they will fit in.
■ Someone who has a competitive nature may feel comfortable in and may prefer to work in a
company where interpersonal competition is the norm.
■ Others may prefer to work in a team-oriented workplace. Research shows that employees
with different personality traits find different cultures attractive.
■ For example, out of the Big Five personality traits, employees who demonstrate neurotic
personalities were less likely to be attracted to innovative cultures, whereas those who had
openness to experience were more likely to be attracted to innovative cultures (Judge &
Cable, 1997).
The Effect of Individual Employee
Cultures on Organisational Culture
■ The cultures of individual employees have significant effects on the culture of the
organisation as explained b Hofstede.
Hofstede’s dimensions of culture
Hofstede’s approach to organizational culture is derivative of the idea that
organizations are subcultures of larger cultural systems.
Five dimensions of national culture operating within organizational culture:
– Individualism
– Power distance
Criticisms
– Uncertainty avoidance
• Conducted entirely within
– Masculinity/femininity
one firm (IBM)
– Time orientation
(long vs. short run) • Measures unstable across
time
• Results do not have face
validity
Hofstede’s national culture study—uncertainty
avoidance and power distance (Fig. 6.1)
Hofstede’s national culture study—
individualism and masculinity (Fig. 6.2)
The role of leaders and reward systems in
shaping and maintaining an organization’s
culture.
■ Leaders are instrumental in creating and changing an organization’s culture.
■ There is a direct correspondence between the leader’s style and an organization’s
culture.
■ For example, when leaders motivate employees through inspiration, corporate culture
tends to be more supportive and people-oriented.
■ When leaders motivate by making rewards contingent on performance, the corporate
culture tended to be more performance-oriented and competitive (Sarros, et. al., 2002).
■ Part of the leader’s influence over culture is through role modelling.
■ Many studies have suggested that leader behaviour, the consistency between
organizational policy and leader actions, and leader role modeling determine
the degree to which the organisation’s culture emphasizes ethics (Driscoll &
McKee, 2007).
■ Leaders also shape culture by their reactions to the actions of others around
them. For example, do they praise a job well done or do they praise a favored
employee regardless of what was accomplished?
■ The company culture is shaped by the type of reward systems used in the
organization and the kinds of behaviours and outcomes it chooses to reward
and punish. One relevant element of the reward system is whether the
organisation rewards behaviours or results
Organisation as an entity and Organisation as
a key management task within firms
■ An organisation is an entity comprising multiple people, such as an institution or an
association, that has a collective goal and is linked to an external environment.
■ In the management process organisation is a management task that combines
various activities in a business to accomplish pre-determined goals.
Can you
manage
culture?

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ORGANISATIONAL

• Ways in which organisational culture is formed and nurtured by top management

Organisational Culture is:

[Hatch, Mary Jo. Organization Theory]

■ Occupational (R&D, legal)

Organisational cultures are created by a variety of factors, including:

Culture is maintained through attraction-selection-attrition, new employee onboarding,

[Hatch, Mary Jo. Organization Theory]

Hatch & Cunliffe: Organization Theory, 4th edition

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