ORGANIZATIONAL BEHAVIOR

W W W . P R E N H A L L . C O M / R O B B I N S
Van Citys Corporate Culture
Vancouver City Savings Credit Union has re-affirmed its
corporate culture to improve customer service and employee
relations.
Courtesy of VanCity
Organizational Culture Defined
The basic pattern of shared assumptions, values, and
beliefs considered to be the correct way of thinking
about and acting on problems and opportunities facing
the organization.
Courtesy of VanCity
DEFINING ORGANISATIONAL CULTURE(Cooke and Rosseau, 1988)


the ways of thinking, behaving and believing
that members of a social unit have in common
The Basic Functions of Organizational Culture
Organizational
Culture/Basic functions
Provides a
sense of
identity for
members
Enhances
commitment
to the
organizations
mission
Clarifies
and
reinforces
standards
of behavior
Levels of culture
National culture
Occupational culture
Organisational culture
Physical Structures
Language
Rituals and
Ceremonies
Stories and Legends


Beliefs
Values
Assumptions
Artifacts of
Organizational
Culture
Organizational
Culture
Elements of Organizational Culture
Rand Merchant Banks Culture
When employees at Rand
Merchant Bank received a
booklet entitled The Complete
Book of Rules, they
discovered that the pages
inside were blank. The book
was a reminder that the South
African financial institutions
culture encourages
employees to make their own
decisions.
Courtesy of Rand Merchant Bank
Meaning of Cultural Content
Cultural content refers to the
relative ordering of beliefs,
values, and assumptions.
Example: Rand Merchant
Banks empowerment
culture
An organization emphasizes
only a handful of values out
of dozens or hundreds of
values that exist.
Courtesy of Rand Merchant Bank
Organizational Culture
Todays Mergers and Acquisitions: Will They be Tomorrows Culture Clashes?
This bank


Citicorp

Bank America

Bank One

First Union
Merged with


Travelers

Nations Bank

First Chicago NBD

Corestates
To become


Citigroup

Bankamerica

Bank One

First Union
Organizational Subcultures
Located throughout the organization
Can enhance or oppose (countercultures) firms
dominant culture
Two functions of countercultures:
provide surveillance and critique, ethics
source of emerging values
Artifacts: Stories and Legends
Social prescriptions of desired (undesired)
behavior
Stories about the past corporate incidents
serve as powerful social prescriptions of the the
things should be done.
Most effective stories and legends:
Describe real people
Assumed to be true
Known throughout the organization
Are prescriptive
Artifacts: Rituals and Ceremonies
Rituals
programmed routines
(eg., how visitors are greeted),dress code,
Ceremonies
planned activities for an audience
(eg., award ceremonies)
Artifacts: Organizational Language
Words used to address people, describe
customers, etc.
Is boss happening? Has your boss come?

Promo Promotion
Aps Advertising positioning
statement
Cool Everything is fine
Googly Tricky situation
Account client
Artifacts: Physical Structures/Symbols
Building structure -- may shape and reflect
culture
Oakleys Interplanetary Headquarters in Foothill
Ranch, California
Office design conveys cultural meaning
Furniture, office size, wall hangings
Benefits of Strong Corporate Cultures
Strong
Organizational
Culture
Social
Control
Improves
Sense-Making
Social
Glue
Problems with Strong Cultures
1. Culture content might be misaligned with the
organizations environment.
2. Strong cultures may focus on mental models that
could be limiting
3. Strong cultures suppress dissenting values from
subcultures.
Adaptive Organizational Cultures
External focus -- firms success depends on
continuous change
Focus on processes more than goals
Strong sense of ownership
Proactive --seek out opportunities

Merging HP Way with Compaq Culture
Hewlett-Packard CEO Carly Fiorina
(left) wanted to inject Compaq
Computers responsiveness into H-
Ps culture by merging the two firms.
Meanwhile, Compaq suffered from
clashing cultures a few years earlier
when acquiring Digital Equipment
Corp., so Compaq executives were
careful to ensure the merger with H-
P was culturally feasible.
Reuters/New media, Inc./ CORBIS
Bicultural Audit
Part of due diligence in merger
Minimizes risk of cultural
collision by diagnosing companies
before merger
Three steps in bicultural audit:
1. Examine artifacts
2. Analyze data for cultural
conflict/compatibility
3. Identify strategies and action
plans to bridge cultures Reuters/New media, Inc./ CORBIS
Merging Organizational Cultures
Assimilation
Deculturation
Acquired company embraces
acquiring firms cultural values
Acquiring firm imposes its culture on
unwilling acquired firm
Integration
Cultures combined into a new
composite culture
Separation
Merging companies remain
separate with their own culture
Strengthening
Organizational
Culture
Founders
and leaders
Culturally
consistent
rewards
Stable
workforce
Selection
and
socialization
Managing the
cultural
network
Strengthening Organizational Culture
Organizational Socialization Defined
The process by which individuals learn the
values, expected behaviors, and social
knowledge necessary to assume their roles in
the organization
Socialization: Learning & Adjustment
Learning Process
Newcomers form a cognitive map of the organizations
physical, social, and strategic/cultural dynamics
Adjustment Process
Newcomers need to adapt to their new work
environment
New work roles
New team norms
New corporate cultural values
Insider

Changing roles
and behavior

Resolving
conflicts
Stages of Socialization
Newcomer

Testing
expectations





Outsider

Gathering
information

Forming
psychological
contract

Pre-Employment
Stage
Encounter
Stage
Role
Management
Individual
Attracts
Organization
Individual
Selects
Organization
Organization
Attracts
Individual
Organization
Selects
Individual
Conflict C Conflict D
Pre-employment Socialization Conflicts
The Process of Innovation
Stage 1

Setting
the
Agenda
Stage 2

Setting
the
Stage
Stage 3

Producing
the
Ideas
Stage 4

Testing and
Implementing
the Ideas
Stage 5

Outcome
Assessment
End
End
Success
Failure
Progress
Motivation
Individual
or Team
Productivity
Resources
Skills
Creating a Customer-Responsive Culture
Key Variables Shaping Customer-Responsive
Cultures
1. The types of employees hired by the organization.
2. Low formalization: the freedom to meet customer
service requirements.
3. Empowering employees with decision-making
discretion to please the customer.
4. Good listening skills to understand customer
messages.
5. Role clarity that allows service employees to act as
boundary spanners.
6. Employees who engage in organizational citizenship
behaviors.
Creating An Ethical Organizational Culture
Characteristics of Organizations that Develop
High Ethical Standards
High tolerance for risk
Low to moderate in aggressiveness
Focus on means as well as outcomes
Managerial Practices Promoting an Ethical
Culture
Being a visible role model.
Communicating ethical expectations.
Providing ethical training.
Visibly rewarding ethical acts and punishing unethical
ones.
What Is Organizational Culture?
Characteristics:
1. Innovation and risk
taking
2. Attention to detail
3. Outcome orientation
4. People orientation
5. Team orientation
6. Aggressiveness
7. Stability
Institutionalization: A Forerunner of Culture
What Is Organizational Culture? (contd)
What Is Organizational Culture? (contd)
Culture Versus Formalization
A strong culture increases behavioral consistency and
can act as a substitute for formalization.
Organizational Culture Versus National Culture
National culture has a greater impact on employees
than does their organizations culture.
Nationals selected to work for foreign companies may
be atypical of the local/native population.
What Do Cultures Do?
Cultures Functions:
1. Defines the boundary between one
organization and others.
2. Conveys a sense of identity for its members.
3. Facilitates the generation of commitment to
something larger than self-interest.
4. Enhances the stability of the social system.
What Do Cultures Do?
Culture as a Liability:
1. Barrier to change
2. Barrier to diversity
3. Barrier to acquisitions and
mergers
Creating a Customer-Responsive Culture
Managerial Actions:
Select new employees with personality and
attitudes consistent with high service
orientation.
Train and socialize current employees to be
more customer focused.
Change organizational structure to give
employees more control.
Empower employees to make decision about
their jobs.
Keeping Culture Alive
Selection
Concerned 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 the
organizations culture.
Stages in the Socialization Process
A Socialization Model
E X H I B I T 18-2
Entry Socialization Options
Formal versus Informal
Individual versus Collective
Fixed versus Variable
Serial versus Random
Investiture versus Divestiture
E X H I B I T 18-3
How Organization Cultures Form
E X H I B I T 18-4
How Employees Learn Culture
Stories
Rituals
Material Symbols
Language
Creating a Customer-Responsive Culture
Managerial Actions (contd) :
Lead by conveying a customer-focused vision
and demonstrating commitment to customers.
Conduct performance appraisals based on
customer-focused employee behaviors.
Provide ongoing recognition for employees who
make special efforts to please customers.
Spirituality and Organizational Culture
Characteristics:
Strong sense of
purpose
Focus on individual
development
Trust and openness
Employee
empowerment
Toleration of employee
expression
How Organizational Cultures Have an Impact
on Performance and Satisfaction
E X H I B I T 18-7