• Business periodicals published  articles that touted culture as the key to the organization's success.

• Organizations with a strong culture perform at higher levels than those without a strong culture.

NATURE OF ORGANIZATION CULTURE

• Organization culture can have powerful effects on organizational performance.

What is Organization Culture?

• A set of values that help members of an organization understand how they should act.

Historical Foundations

Anthropological Contributions

• Anthropology - study of human culture
• "native's point of view"

Anthropological Contributions

• It is most closely related to the study of culture and cultural phenomena because anthropologists seek to understand how the values and beliefs that make up a society's culture affect the structure functioning of that society.

Sociological Contributions

• Sociology - study of people in social systems such as organizations and societies.
• By studying rituals, we can understand the most basic values and beliefs of a group of people.

Social Psychoglogical Contributions

• Social Psychology - branch of psychology that includes the study of groups and the influence of social factors on individuals.
• People tend to use stories or information about a singles event more than they use multiple observations to make judgement.

Social Psychoglogical Contributions

• The impact of stories on decision making suggests an important reason that organization culture has a powerful influence on other people in an organization.

Economic Contributions

• Attempts to link the cultural attributes of firms with their performance rather than simply describing the culture of companies as the sociological and anthropological perspectives do.

Economic Contributions

• The relationship between culture and performance depends, to some extent at least, on the values expressed in the organization's culture.
• The fact that a firm has a culture does not mean it will perform well. A variety of cultural traits can actually hurt performance.

Organizational Culture

- The historical context within a situation occurs and the impact of this context on the behaviors of employees.

• ​​Difficult to alter in the short-run
• Means through which people in the organization learn and communicate organization acceptability (values and norms)

Organizational Climate

- The current situations in an organization and the linkages among work groups, employees, and work performance.

• Easier for management to manipulate in order to directly affect the behavior of employees.

vs.

Culture is what makes us us."

Creating the Organizational Culture

Step 1: Formulate Strategic Values

Basic beliefs about an organization's environment that shape its strategey

Step 2: Develop Cultural Values

Values employees need to have or act on for the organization to carry out it is strategics values

On how and why the company can succeed

Linked with strategic values

Step 3: Create Vision

What the company will be like at some point in the future

Combination of Strategic Values & Cultural Values

Step 4: Initiate Implementation Strategies

Actions to accomplish the vision

Step 5: Reinforce Cultural Behaviours

Strengthen the behavior of the employees by:

1. Formal reward system
2. Stories
3. Ceremonies

Approaches to Describing Organization Culture

• Ouchi Framework
• Peter and Waterman Approach

Ouchi Framework

Focus on analyzing the cultures of limited group of firms

1. Typical Japanese Firms
2. Typical US Firms
3. Type Z US Firms

Ouchi Framework

Peter and Waterman Approach

Focused on the relationship between organization culture and performance

Describe the management practice that led to their success

Peter and Waterman Approach

1. Bias for action
2. Stay close to the customer
3. Autonomy and entrepreneurship
4. Productivity through people

Peter and Waterman Approach

5. Hands on management

6.Stick to knitting

7. Simple form, lean staff

8. Simultaneously loose and tight organization

Emerging Issues in Organization Culture

Innovation

• It is the process of creating and doing new things that are introduced into the marketplace as products, processes, or services.

Radical Innovation

Major breakthrough that changes or creates whole industries.

Systems Innovation

Creates new functionality by assembling part in new ways.

Incremental Innovation

Continues the technical improvement and extends the applications of radical and systems innovation

Corporate Research

• Most common means of developing innovation
• Researchers are responsible for keeping the company's products and processes technologically advanced

Empowerment

The process of enabling workers to set their own goals, make decisions, and solve problems within their sphere of responsibility and authority.

Managing Organizational Culture

Elements of Managing Organizational Culture 

• Take advantage of the existing culture

Elements of Managing Organizational Culture 

• Teaching the organization culture: Socialization

Socialization - process through which individuals become social beings

Organizational Socialization - process through which employees learn about the firm's culture and pass their knowledge and understanding to others.

Elements of Managing Organizational Culture 

• Changing the Organizational Culture

Other Elements

• Managing Symbols
• The Difficulty of Change
• The Stability of Change