Organizational Culture &

Environment
BASIC MANAGEMENT AND
ACCOUNTING

Nama Dosen : Melvin Hendriks, MM

 Chapter 2
 Outline:

1. Seven dimensions of organizational culture.

2. How culture is transmitted to employees.
3. Characteristics of an ethical culture, and a customer-
responsive culture.
4. Two dimensions of environmental uncertainty.
5. Organizational stakeholders.

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Question of Culture !

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 The Organization’s Culture

 Organizational Culture
A system of shared meanings and common beliefs held
by organizational members that determines, in a large
degree, how they act towards each other.
 “The way we do things around here.”
 Values, symbols, rituals, and practices
 Implications:
 Culture is a perception.
 Culture is shared.
 Culture is descriptive.

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Dimensions of Organizational
Culture

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 Strong vs Weak Organizational
Cultures
 Strong Cultures
 Values widely shared
 Culture conveys consistent
messages about what’s important
 Most employees can tell stories
about company history
 Employees strongly identify with
culture
 Strong connection between shared
values and behaviors
 Weak Cultures
 Values limited to a few people –
usually top management
 Culture send contradictory
messages about what’s important
 Employees have little knowledge
of company history
 Employee have little identification
with culture
 Little connection between shared
values and behaviors
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 Benefits of Strong Culture

 Creates a stronger employee commitment to the

organization.
 Aids in the recruitment and socialization of new
employees.
 Fosters higher organizational performance by
instilling and promoting employee initiative.

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 Functional vs Dysfunctional
Culture

 Functional Cultures
 Are cultures well-suited to their environment or industry.
 Ex: A highly-innovative company in the high-tech industry, or
a customer-focused company in the high-end lodging
industry.
 Dysfunctional Cultures
 Are cultures which are poorly-suited to their environment.
 Ex: A company which is slow to react to marketplace
changes, or a company which has low concern for
employees or customers.

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 Organizational Culture
 Sources of Organizational Culture
 The organization’s founder
 Vision and mission
 Past practices of the organization
 The way things have been done
 The behavior of top management
 Continuation of the Organizational Culture
 Recruitment of like-minded employees who “fit”
 Socialization of new employees to help them adapt to
the culture
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 How Employee Learn Culture

 Stories
 Narratives of significant events or actions of people that carry the spirit
of the organization
 Rituals
 Repetitive sequences of activities that express and reinforce the values
of the organization
 Material Symbols
 Physical assets distinguishing the organization
 Language
 Acronyms and jargon of terms, phrases, and word meanings specific to
an organization

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How an Organization’s Culture is
Established and Maintained

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 Creating More Ethical Culture

 Be a visible role model.

 Communicate ethical expectations.
 Provide ethics training.
 Visibly reward ethical acts and punish unethical ones.
 Provide protective mechanisms so employees can
discuss ethical dilemmas and report unethical behavior
without fear.

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 Creating More Customer-
Responsive Culture

 Hire service-contact people with the personality and attitudes consistent with
customer service—friendliness, enthusiasm, attentiveness, patience, concern
about others, and listening skills.
 Train customer service people continuously by focusing on improving
product knowledge, active listening, showing patience, and displaying
emotions.
 Socialize new service-contact people to the organization’s goals and values.
 Design customer-service jobs so that employees have as much control as
necessary to satisfy customers.
 Empower service-contact employees with the discretion to make day-to-day
decisions on job-related activities.
 As the leader, bring a customer-focused vision and demonstrate through
decisions and actions the commitment to customers.

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 Spirituality & Organizational
Culture

 Workplace Spirituality
 The recognition that people have an inner life that
nourishes and is nourished by meaningful work that takes
place in the context of community.
 Characteristics of a Spiritual Organization
 Strong sense of purpose
 Focus on individual development

 Trust and openness

 Employee empowerment

 Toleration of employees’ expression

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 Benefits of Spirituality
 Improved employee productivity
 Reduction of employee turnover
 Stronger organizational performance
 Increased creativity
 Increased employee satisfaction
 Increased team performance
 Increased organizational performance

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The External Environment

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 How the Environment Affects
Managers

 Environmental Uncertainty

 Theextent to which managers have knowledge of and

are able to predict change their organization’s external
environment is affected by:

 Complexity of the environment: the number of components in

an organization’s external environment.
 Degree of change in environmental components: how
dynamic or stable the external environment is.

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 Competitors
 Competitive Intelligence (CI)
 Fuld & Company (www.fuld.com)

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Organizational Stakeholders

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 Team-Based Assignment
Students have to work in teams of five. To assist students in
Selecting two companies, the following is provided :
 Aerospace
- Boeing  Electronics
- Lockheed Martin - Panasonic
 Automotive - Sony
- Ford
- General Motors  Golf Equipment
 Athletic Wear - Maxfli
- Nike
- Reebok - Titleist
 Beverages  Mail, Package Delivery
- Coca-cola - Federal Express
- PepsiCo
- United Parcel Service
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 Use the form below to identify the environmental
factors for two companies that you have selected

Task Environmental Company 1 Company 2

Force/Factor
Customers

Competitors

Suppliers

Stakeholders

Government

Pressure Groups

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 Use the form below to identify the environmental
factors for two companies that you have selected

General Environmental Company 1 Company 2

Force/Factor
Economic Conditions

Political/ Legal
Conditions
Sociocultural

Global

Technological
Conditions

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Thank You

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