Module – Introduction to Business Studies

(IBS).
Short Title – IBS.

DATE:

Lecturer:
Week 11 – Lecture 2: Organisational Culture

▪ Module code – FY021

▪ Level 3
▪ Week 11 lecture – 2
▪ Email:
▪ Office hour:
▪ Pat hour:
By the end of your lecture on this module you should be
able to outline the concept below in your own terms

▪ Organisational culture
▪ How culture develop
▪ Four types of culture
▪ Summary of Handy’s theory
▪ How to create and sustain culture
▪ Various activities
Organisational culture

▪ In the same way that we develop a national identity so

people working within organisations develop their own
culture
▪ Organisation culture is like a personality which goes
beyond the formal structure
▪ Culture gives an organisation its sense of identity -’who
we are’, ‘what we stand for’, ‘what we do’ and ‘how we
should behave’
▪ It is the ‘glue’ that holds the organisation together
Organisational culture
▪ The collection of traditional values, policies, beliefs and
attitudes that constitute a pervasive context for
everything we do and think in an organisation (Mullins,
2016)
▪ The culture of an organisation is often likened to the
personality of an individual.
Understanding your organisation’s personality

▪ If you were to represent your organisation as an individual with a

personality, answer the following questions
–What gender would it be?
–How old?
–Where would it live?
–What would its hobbies be?
–Where would it go on holiday?
–Three strengths and three weaknesses
How does culture develop?

▪ History – why organisation was formed, age values of owners

▪ Primary function of the business – product or service offered
▪ Strategy – long term growth? Customer focus? Social
Responsibilities?
▪ Size of organisation – larger organisations more structured
▪ Location – consider hotels where location can impact on culture for
staff
▪ Management and leadership – top execs can have a major
influence eg Steve Jobs
Four types of culture – (Handy,1993)

Power culture
central powerful figures
few rules and systems
personal communications
fast decisions
Relies on trust, empathy and personal
communications
Four types of culture
▪ Role Culture
–typical of a bureaucratic
organisation
–work is decided via rules and regulations
–power is based on level in hierarchy
–people work to a job description
Four type of culture
▪ Task culture
–project based company
–team working
–task is key rather than individuals or rules
–freedom and flexibility
Four type of culture
▪ Person culture
–individuals are central focus
–organisation only exists to serve the interests
of those within it
–barristers, architects
–no hierarchy
Summary of Handy’s theory

▪ Every organisation will have its own unique structure

▪ Large organisations may have a mix of cultures with
examples from each of the types.
▪ Different people enjoy working in different cultures,
linking this to motivation and satisfaction at work
Mullins, 2016
Type of organisational culture : Deal and
Kennedy 1982

▪ Tough-guy macho culture

▪ Work hard/play hard culture
▪ Bet-your-company culture
▪ Process culture
More details

▪ Tough-guy macho culture

– Lots of individuals working there who take high
risks regularly. Feedback is given quickly to
employees on their actions

▪ Work hard/play hard culture

–Fun and action are key but employees take few risks.
Again feedback on your actions happens quickly
Continuation…

▪ Bet-your-company culture
–Decisions are taken with lots at stake. However it can take
years for employees to know the results of those decisions and
actions. High risk, slow feedback.

▪ Process culture
–Little or no feedback provided for employees. People not sure
how they contribute to the company’s success. Often very
bureaucratic.
Activity
Consider a retail company that you would like to work for.
Go online and research that company. What can you
find out about that company’s culture from the website?

Can you link your research to Handy or Deal and

Kennedy’s model?
Think about this as an example

▪ Innocent smoothie company – have a very relaxed culture. They

treat their staff like heroes. Annual nature weekend. An extra 5 days
holiday if you get married while working there. There is a monthly
massage offered to all staff, plus yoga classes and a subsidised
gym.
▪ The company gives a high proportion of its profits to charity so it is
very ethical. It is not run as a business it is a ‘passion’. BASIC
ASSUMPTION rests on ‘no concentrate just whole crushed fruit’!
(Sunday Times, 2013).
Think about this as an example

▪ Nando’s – management team’s fundamental belief is that if you look

after your people the customers will have a good time and you will
make money. Therefore the culture is focused on looking after its
people in lots of different ways. Job titles are whacky e.g. All
employees are called Nandocas.

▪ They have a book of ‘stories’ as a guide to managing the Nando’s

way. Tales from the history of Nando’s are used to illustrate lessons
that have been learnt.

▪ Nandos were voted the top company to work for in the Sunday
Times survey for 2011. They scored highly for team spirit and open
communication
Activity: make a group of 4 – 5 and discuss:

▪ How culture affects behaviour and whether they think it helps or

hinders performance?
▪ Does the result of your discussion closely reflect or relate to
organisation’s culture studied?
▪ Do you think culture is suitable for the organisation?
Fun places to ease off stress & tension

▪
Innocent, Nandos and Google

▪ Can you link them back to either of the models we

introduced earlier?

▪ If not, might there be any reasons why?

How to create and sustain culture

▪ Often starts with the founder of the organisation who has

a vision of what they want to do.
▪ Need to ensure your HR policies and practices reflect
the culture. Consider how this comes across in
recruitment, pay and promotion.
▪ Needs to be owned and shared by all senior managers.
Check your learning
▪ Define organisational culture.

▪ Describe how organisational culture is formed.

▪ Give three examples of the factors making up

organisational culture.

▪ Explain 2 key theories relating to Organisational Culture.

Thank You!!