OTB Notes - Matovu Musa (PhD)

ORGANIZATIONAL CULTURE

Organizational culture “a system of shared meaning held by members,

distinguishing the organization from other organizations”. Organizational culture
also refers to the distinctive norms, beliefs, principles and ways of behaving that combine
to give each organization its distinct character. Organizational culture, sometimes called
corporate culture, is a system of shared meaning held by members that distinguishes the
organization from other organizations.

Organizational culture might also refer to the pattern of basic assumptions invented,
discovered, or developed by a given group as it learns to cope with its problems of
external adaptation and internal integration that has worked well enough to be considered
valid, and therefore, to be taught to new members as the correct way to perceive, think,
and feel in relation to those problems”. Also, organizational culture might refer to pattern
of values, norms, beliefs, habits, attitudes, principles and assumptions may be unwritten
or non-verbalized behaviour that describe the way in which things get done; to give the
organization its unique character.

Organizational culture affects the way people and groups interact with each other, with
clients, and with stakeholders. Ravasi and Schultz (2006) state that organizational culture
is a set of shared mental assumptions that guide interpretation and action in organizations
by defining appropriate behavior for various situations. At the same time although a
company may have their "own unique culture", in larger organizations, there is a diverse
and sometimes conflicting cultures that co-exist due to different characteristics of the
management team. The organizational culture may also have negative and positive
aspects.

Healthy organizational cultures

Organizations should strive for what is considered a "healthy" organizational culture in
order to increase productivity, growth, efficiency and reduce counterproductive behavior
and turnover of employees. A variety of characteristics describe a healthy culture,
including:
a) Acceptance and appreciation for diversity
b) Regard for and fair treatment of each employee as well as respect for each
employees’ contribution to the company
c) Employee pride and enthusiasm for the organization and the work performed
d) Equal opportunity for each employee to realize their full potential within the
company
e) Strong communication with all employees regarding policies and company issues
f) Strong company leaders with a strong sense of direction and purpose
g) Ability to compete in industry innovation and customer service, as well as price
h) Lower or no employee turnover
i) Investment in learning, training, and employee development

1
 OTB Notes - Matovu Musa (PhD)

Other characteristics include;

j) Innovation and risk taking; this is the extent to which employees come up with
new ideas and the organization is ready to put them into practical.
k) Attention to details; the extent or degree to which employees are expected to
exhibit precision analysis and attention to details.
l) Outcome oriented; the degree to which management is focused onto results or
outcomes rather than the technique or processes used to achieve the outcomes.
m) People orientation; degree to which management decisions take into
consideration of the effect of the outcome on people within the organization;
Physically, financially and mentally.
n) Team orientation; the degree to which work activities are organized around
teams rather than individuals.
o) Aggressiveness; extent to which people in the aggressive and competitive rather
than easy going. Goal directed.
p) Stability; the extent to which organizational activities emphasize maintaining the
status quo in contrast to growth.

Components of organizational culture

Organizational culture can be described in terms of values, norms, artefacts and

management styles;
1. Values; these are beliefs in what is best or good for the organization and what should
or ought to happen. The stronger the values, the more they influence behaviour.
When values are acted on, they are called “values in use”. Values are translated into
reality through norms and artefacts. They may also be expressed through
organizational language (jargon), rituals, stories and myths.
2. Norms; these are unwritten rules of behaviours that is the rules of the game that
guide behaviour. Norms tell people what they are supposed to do, say, believe, and
even wear. They might be written, are passed on by word of mouth or behaviour.
They exert very powerful pressure on behaviour through people’s reactions, if they
are violated. Typical norms include how managers treat their subordinates, prevailing
work ethics, status, ambition, performance, power, politics, loyalty, anger and
approachability.
3. Artefacts; these are the visible and tangible aspects of the organization that people
hear, see, tell and contribute to their understanding of the organization.
4. Management style; this is the approach managers use to deal with people. Can
also be called leadership styles. These include charismatic/non-charismatic,
autocratic/democratic, enabler/controller and transactional/transformational. Every
manager has his/her style, but this is influenced by the organizational culture, which
may produce a management style that represents the behavioural norms for
managers.

Advantages of organizational culture

a) Boundary of defining roles. This creates distinctions between organizations
b) Creates a sense of identity among organizational members
2
 OTB Notes - Matovu Musa (PhD)

c) Culture facilitates commitment rather than individual interest. It enhances

organizational commitment.
d) Enhances system stability due to uniqueness they possess because of the
organization culture
e) Holds organizational structures together
f) Culture serves as a sense making and control mechanism that guides shapes
attitudes and behaviours of employees.

Disadvantages
a) Barrier to change; When shared values do not agree with those that further the
organizational effectiveness.
b) When the organizational culture does to favour the organizational environment
c) When the environment is undergoing change, some organizational values, culture
may no longer be appropriate.
d) Organizational culture might carry rigidness that failure to change despite of the
changing times.
e) Barrier to acquisitions and mergers – cultural incompatibility in considering
acquisitions and mergers with other organizations.
f) Barrier to diversity; it can be a paradox when the management wants new
employees to accept the organizational core cultural values.

Classifying organizational culture

There have been several attempts to classify organizational culture. Most of the
classifications are expressed in four dimensions. Following the lead by Harrison (1972)
there is much common ground between the classifications. His classification was
1. Power oriented: Competitive, responsive to personality rather than expertise
2. People oriented: Consensual, management systems
3. Task oriented: Focus on competency, dynamics of work
4. Role oriented: Focus on legality, legitimacy and bureaucracy

Sustaining and supporting culture

If there is an appropriate and effective culture, it would be desirable to take steps to

support it and reinforce it. Three forces play important part in sustaining culture;
1. Selection; the final decision to hire a candidate is significantly influenced by the
selectors, judgment of how well the candidate will fit into the organization.
2. Top management; through what top managers say and behave has major impact
on organization’s culture
3. Socialization; the process through organizations help new employees to adapt to
their culture.

3
 OTB Notes - Matovu Musa (PhD)

Chart summarizing how organizational cultures form

Top management

Philosophy of Organizational
Selection culture
organization’s
criteria
founders Socialization

Creating an ethical organizational culture

An organizational culture that is most likely to shape high ethical standards is one that is
high in risk tolerance, moderate/low aggressiveness and focuses on means as well as
outcomes. The following practices can help in building more ethical cultures;

1. Management being a visible role model to other employees

2. Management should communicate ethical expectations from its employees.
3. Provide ethical training to clarify what practices are not permissible within an
organization.
4. Provide protective mechanisms to the organizational culture, e.g. forums for
discussing ethical dilemmas and reporting unethical behaviour without fear of
reprimand.
5. Building on employees’ strength; positive organizational culture emphasizes showing
workers how they can capitalize on their strengths.
6. Rewarding more than punishing; this involves smaller and cheaper rewards.
7. Emphasizing vitality and growth. A positive culture recognizes that employees’ career
aspirations are important; shows interest in what the individual does for the
organizations; and what the organization can do to help employees advance their own
careers.

Linking organizational structure to organizational culture;

Organizational culture is greatly linked to organizational structure in the following ways;

1. Power culture; concentrates power among a small group or a central figure and
its control is radiating from its center like a web. Power cultures need only a few
rules and little bureaucracy but swift in decisions can ensue.
2. Role culture; authorities are delegated as such within a highly defined structure.
These organizations form hierarchical bureaucracies, where power derives from
the personal position and rarely from an expert power. Control is made by
procedures, strict roles descriptions and authority definitions. These organizations
have consistent systems and are very predictable.
3. Task culture; teams are formed to solve particular problems. Power is derived
from the team with the expertise to execute against a task. This culture uses a
small team approach, where people are highly skilled and specialized in their own
area of expertise. Additionally, these cultures often feature the multiple reporting
lines seen in a matrix structure.

4
 OTB Notes - Matovu Musa (PhD)

4. Person culture; formed where all individuals believe themselves superior to the
organization. It can become difficult for such organizations to continue to operate,
since the concept of an organization suggests that a group of like-minded
individuals pursue organizational goals. However, some professional partnerships
operate well as person cultures, because each partner brings a particular expertise
and clientele to the firm.

ORGANIZATIONAL CHANGE AND DEVELOPMENT

Introduction

Organizations today are in a dynamic multi-cultural environment which requires

adaptation. Every company is experiencing turbulent change, for example there is
increased international competition, deregulation, mergers, rapid growth information
technology, and changing society values. Organizations must find ways of managing
both short-term and long-term changes. These changes in the environment and the need
for effective leadership, motivation, organizational environment and roles require
successful change interventions. Armstrong notes that change is about adapting to the
dynamic business environment and creating effective organizations, organization
development is about taking systematic steps to improve organizational capacity, it is
concerned with process – how things get done.

Definitions

1. Change is concerned with making things different

2. Change intervention is a planned action to make things different
3. A person(s) who acts as catalyst and assumes responsibility for managing change, is
a change agent. Change agents can be managers or non-managers, current
employees of the organization, newly hired employees or outside consultants.
4. Organization Development (OD) is a system approach to change. It is “system-wide
application and transfer of behavioural science knowledge to the planned
development, improvement and refinement of the strategies, structures and
processes that lead to organizational effectiveness” (Cummins and Worley, 2005). OD
is a team that used for a variety of change-oriented activities.

Forces that trigger organizational change

1. Changing nature of the workforce – demographic changes, immigration and

outsourcing have transformed the workforce.
2. Technology – is changing jobs and organizations. Just as the organization adapts
to one technological change, other technological challenges and opportunities come
to the forefront.
3. Economic shocks – e.g. the global economic innovations that turn new investors
into millionaires in overnight collapse fast sharp changes in interest rates etc.
4. Competition is changing – heightened global competition means that successful
organizations will be the ones that can change in response to the competition. They

5
 OTB Notes - Matovu Musa (PhD)

will be fast on their feet, capable of developing new products rapidly and get them on
the market quickly.
5. Social trends – for example, consumers are increasingly doing their shopping at ‘big
box’ retailers and online, and people are meeting and sharing information on the
internet. There are changes in consumer needs and preferences.
6. World politics – governments in biggest world economics have changed and these
often pose special challenges for organizations, given that a number of organizations
operating in these nations are engaged in international businesses.

Types of change

Organizational change can be categorized into three types; strategic, operational and
transformational change.
1. Strategic change – is concerned with broad, long-term and organization-wide issues
involving change. It is about moving to a future state that has been defined in terms
of strategic vision and scope. It covers the organization’s purpose, mission and
corporate philosophy for employees, achieving and maintaining a competitive
advantage and for product-market development.
2. Operational change – relates to new systems, procedures, structures or technology
that will have an immediate effect on working arrangements within a party of the
organization. Its impact on people is likely to be more significant than strategic
change, thus has to be handles carefully.
3. Transformational change – takes place when there are fundamental and
comprehensive changes in structures, process and behaviours that have dramatic
effect on the way in which the organization functions.

The change process

 The change process starts with an awareness of the need for change. This requires
an analysis of the situations and factors that have created it, leading to understanding
the characteristics and direction of action to be taken. Possible courses of action can
be identified, evaluated and a choice made of the preferred action.
 The next critical stage is to decide on how to get from here to another level. You
introduce change, and manage emerging problems of introducing change. The
programs at this phase can include resistance to change, low stability and high levels
of stress, misdirected energy, conflicts and loss of direction, etc. there is need to
predict problems that are likely to arise out of introducing change and take steps to
manage them. The implementation of change and its related phase can be painful
and might require adequate planning and intervention measures to the likely
outcomes if change is made.
 The change process takes place more smoothly with the help of credible internal or
external change agents. External and internal agents should all be involved in the
change process of the organization. Respected internal agents can do a good job
because they have to live with the consequences of their action.

6
 OTB Notes - Matovu Musa (PhD)

The following are guidelines for change management

 Sustainable change requires commitment and visionary leadership

 Understand organizational culture and the levers for change that are likely to be
effective in that culture
 Change managers should have good temperament and leadership skills
appropriate to the organization and change strategies.
 Change is more successful if there is a powerful and convincing reason for it.
 Full participation in planning and implementing change
 Rewards should encourage innovation and success in achieving change
 Failures are always expected, and learn from them
 Hard evidence on need for change is most powerful tool to achieve it. But is also
hard to decide on how to satisfy the need for change
 It is easier to achieve change attitudes or organizational culture
 Select people who can champion change, who welcome challenges and
opportunities that change provides, as change agents
 Resistance to change is inevitable, if people feel they are going to be worse-off
 In the age of globalization, change is inevitable. Managers must explain why
change is essential and how it will affect everyone; and protect the interest of
those affected.

Assignment: Read about the models/ approaches to managing organizational change

Resistance to change

Organizations and their members resist change. Change is often seen as threatening.
According to Woodward (1968) articulated that people resist change because it is seen
as a threat to familiar patterns of behaviour as well as to status and financial rewards.
We should not however, that some people welcome change as an opportunity.
Specifically, main reasons for change can be categorized into two forms: Individual and
organizational sources.

Individual sources

1. Habits – the tendency to respond in our accustomed ways becomes a source or

resistance.
2. Security – people with a high need for security are likely to resist change because it
threatens feelings of safety
3. Economic factors – changes in work routines can arouse economic fears, if people
are concerned that they will not perform the new tasks/routine to their previous
standards, especially when pay is closely linked to productivity.
4. Fear of the unknown – change substitutes ambiguity and uncertainty for the
unknown
5. Inconvenience – feeling that change will make more difficult.

7
 OTB Notes - Matovu Musa (PhD)

6. Symbolic fears – change may affect some treasured symbols such as reserved
parking space
7. Threat to status of skill – change is perceived as reducing the status of individuals
or as de-skilling them.
8. Selective information processing – tendency of people processing information in
a manner that keep their perceptions intact. They hear want they want to hear, and
ignore information that challenges the world they have created.

Organizational sources

1. Structural inertia – built-in mechanisms to produce stability. Change confronted

with change, this inertia can act as a counterbalance to sustain stability.
2. Limited focus of change – limited changes in subsystems/departments tend to be
nullified by the larger system.
3. Group inertia – group norms can act as a constraint, even if individuals want to
change their behaviour
4. Threat to expertise – changes in organizational patterns may threaten the expertise
of specialized groups
5. Competence fears – concern about the ability to cope with new demands or to
acquire new skills.
6. Threat to established power relations – redistribution of decision-making
authority can threaten long-established power relationships in the organization.
7. Threat to established resources allocations – groups that control sizable
resources often see change as a threat. They are contented with the way things are.

Overcoming Resistance to change

The following tactics have been suggested for use by change agents in dealing with
resistance to change;
(a) Education and communication – communicate to employees to help them see the
logic of a change. This clears any misinformation and misunderstandings. It also
helps in selling the need for change
(b) Participation; involvement of those opposed to change in the decision making
process, can help reduce resistance, garner more commitment and increase quality of
the change decision.
(c) Building emotional commitment – firing up employees can help them emotionally
commit to change rather than embracing the status quo
(d) Implementing changes fairly – procedural fairness is particularly important to
ensure that employees see that the change is being implemented consistently and
fairly.
(e) Cooptation – ‘buying off’ the leaders of resistance group by giving them a key role
in the change decision. This helps to get their endorsement. Ensure that they do not
aware that they are being tricked or used.
(f) Selecting people who accept change – ability to easily accept change is related
to personality.

8
 OTB Notes - Matovu Musa (PhD)

(g) Coercion – application of direct threats or force on the resisters; e.g.., threat to close
the department, transfer, loss of promotions, negative performance evaluation, and a
poor letter of recommendation. But this can backfire and change agents’ credibility
can drop to zero.

Components of organizations

Assignment: Read and make notes about components or organization and

organizational processes.

Organizational Development (OD)

Discussion of organizational change is incomplete without talking about organizational
development. OD is a team that is used to encompass a collection of change interventions
built on humanistic-democratic values that seek to improve organizational effectiveness
and employee well-being.

Organizational Development (OD) values and objectives

OD programs aim to improve the quality of working life of all members of the
organization. The OD paradigm values human and organizational growth, collaborative
and participative processes, and a spirit of inquiry. The following identifies the underlying
values in most OD efforts;
(a) Respect for people; individuals are seen as being responsible, conscientious and
caring. They should be treated with dignity
(b) Trust and support; an effective and healthy organization is characterized by trust,
authenticity, openness, and a supportive climate.
(c) Power equalization; effective organizations de-emphasize hierarchical authority
and control.
(d) Confrontation; problems should be openly confronted and not just swept under the
rug
(e) Participation; People are more committed in implementing decisions if they have
been involved in the decisions for change.

OD interventions/Activities
The following are some of the OD interventions to bring about change
(a) Sensitivity training; also known as laboratory training, encounter groups or T-
groups. It is a method of changing behaviour through unstructured group
interactions (in a free and open environment in which members, with the help of
a professional discuss their ideas, attitude and beliefs about change)
(b) Survey feedback; is a research technique in which data are systematically
collected from organizational changes. Results are shared with employees and
helps in acceptance of change, and provide ideas for how to address areas of
concern and resistance to change.
(c) Process consultation; involves a consultant helping clients (normally managers)
to generate and analyze information they can understand and, following a
diagnosis of a problem, act upon. The information is related to organizational
9
 OTB Notes - Matovu Musa (PhD)

processes such as intergroup relations, interpersonal relations and

communications. The job of the process consultant is to help the organization to
solve its own problems by making it aware of organizational processes of the
consequences of these processes, and of the mechanism by which they can be
changed.
(d) Appreciative inquiry; is an approach that seeks to identify the unique qualities
and special strengths of the organization that can be built on to improve
acceptance for change. It focuses on organization’s successes rather than on
problems. Appreciative inquiry involves four steps;
a. Discovery – finding out what people think are the strengths of the
organization
b. Dreaming – using information from first step to speculate/dream about the
possible future of the organization.
c. Design – based on the dream, members focus on finding a common vision
of how the organization will look agree on its unique qualities.
d. Destiny – members discuss how the organization is going to fulfil its dream.
This includes writing action plans and implementation strategies.
(e) Action research; involves collecting data from people about organizations
process issues and feeding it back to identify problems and the likely causes. This
typically involves collecting data, diagnosis, feedback action planning, action and
evaluation.
(f) Group dynamics; interventions are directed towards analysis of effectiveness of
team processes e.g. problem solving, decision making, interpersonal relations, etc;
diagnosis, discussion and a joint consideration of actions required to improve team
effectiveness.
(g) Intergroup conflict interventions; aims at improving intergroup relations by
getting groups share their perceptions about each other, what they have learned
about themselves, agree on issues to be resolved and actions required.
(h) Neuro-linguistic programming (NLP); in which people learn to program their
reactions to others and develop unconscious strategies for interacting with them.
(i) Transactional analysis; an approach to understanding how people behave and
express themselves through transactions with others using the aren’t-adult-child
model
(j) Behaviour modification; using positive reinforcement and corrective feedback
to change behaviour. It involves behaviours to be modified, extent to which they
occur, what causes them and their consequences, developing a strategy to
strengthen desirable behaviours and weaken dysfunctional behaviours; and
evaluating outcome.
(k) Integrated strategies change; is a highly participative approach that aims to
facilitate the implementation of strategic plans. It involves a number of steps;
strategic analysis; developing strategic capacity; creating a high level of shared
ownership and commitment, creating the strategy and gaining commitment and
support for it, implementing the strategic change plan, allocating resources,
providing feedback and solving problems as they arise.

10
 OTB Notes - Matovu Musa (PhD)

Implications
(a) A number of change are culture bound. For example, in cultures where people believe
that they can dominate their environment, individuals will take a proactive view of
change. Where people see themselves as subjugated to their environment, they tend
to take a passive approach towards change
(b) Change is one of the greatest causes of stress in organizations. Changes bring about
opportunities, demands, etc that can result into stress. The stress of change should
be managed appropriately
(c) Change requires managers take a close look at a number of organization process and
issues such as attitudes, leadership, work teams, etc.
(d) Change is inevitable given that the real world is turbulent, requiring organizations and
their members to undergo dynamic change in order to perform at competitive levels.
(e) Managers are increasingly findings that the world is one of constant and chaotic
change; and must therefore continually act as change agents.

IMPROVING ORGANIZATIONAL PERFORMANCE

11