Organizational Culture and Change

Organizational culture A system of shared values, norms, and assumptions that

guide member’s attitudes and behaviors

Artifacts—The physical manifestation of the culture including open offices, awards, ceremonies, and formal lists of values

Espoused values and norms—Diagram of the chain of command and reporting relationships in a company

Enacted values and norms—Values and norms that employees exhibit based on their observations of what actually goes on in the organization

Assumptions—Those organizational values that have become so taken for granted over time that they become the core of the company’s culture

Four Levels of Culture

Does Culture Matter? Culture boosts organizational performance when

it:(1)is strategically relevant(2)is strong(3)emphasizes innovation and change to adapt to a

changing environment

Actively managing an organization’s culture improves its competitive advantage and performance when the culture supports

the business strategy, is strong, and enables innovation and change.

How Leaders Create and Maintain Culture An organization’s culture is influenced in part by its

industry Different industries develop different cultures Organizational culture is also influenced by the national

culture in which the organization is embedded Company founders and leaders also influence a firm’s

culture

Develop a clear sense of mission and values about what the company should be, and communicate it to employees through what you pay attention to, measure, and control.

Select employees who can share, express, and reinforce the desired values in order to help build the desired culture.

Use daily routines and concrete actions and behaviors to demonstrate and exemplify appropriate values and beliefs.

Consistently role model behaviors that reinforce the culture.

Make your human resource management procedures and criteria consistent. Communicate your priorities in the way you reward employees. Linking raises and promotions to specific behaviors communicates leaders’ priorities.

Nurture traditions and rituals that express, define, and reinforce the culture. Awards and recognition ceremonies, having the CEO address new employees during their orientations, and reciting stories of past company successes can all define and reinforce a firm’s culture.

Changing an organization’s culture helps instill new employee attitudes, behaviors,

or values.

Cultures of Conflict and Cultures of Inclusion Conflict Culture Active Passive Agreeable Disagreeable

Culture of Inclusion

Conflict Culture Dominating conflict cultures: Dominating conflict cultures

are active and disagreeable—open confrontations are accepted as well as heated arguments and threats

  Collaborative conflict cultures: Collaborative conflict

cultures are active and agreeable

Avoidant conflict cultures: Avoidant conflict cultures are passive and agreeable

Passive-aggressive conflict cultures: Passive-aggressive conflict cultures are both passive and disagreeable

How Leaders Create and Maintain Culture An organization’s culture is influenced in part by its

industry Different industries develop different cultures Organizational culture is also influenced by the national

culture in which the organization is embedded Company founders and leaders also influence a firm’s

culture

How Leaders Can Influence an Organization’s Culture

Develop a clear sense of mission and values about what the company should be, and communicate it to employees through what you pay attention to, measure, and control.

Select employees who can share, express, and reinforce the desired values in order to help build the desired culture.

Use daily routines and concrete actions and behaviors to demonstrate and exemplify appropriate values and beliefs.

Consistently role model behaviors that reinforce the culture.

Make your human resource management procedures and criteria consistent. Communicate your priorities in the way you reward employees. Linking raises and promotions to specific behaviors communicates leaders’ priorities.

Nurture traditions and rituals that express, define, and reinforce the culture. Awards and recognition ceremonies, having the CEO address new employees during their orientations, and reciting stories of past company successes can all define and reinforce a firm’s culture.

Effective employees understand their organization’s conflict culture and how to

appropriately resolve conflict.

Cultures for Managing Conflict

Source: Gelfand, M.J., Leslie, L.M., & Keller, K.M. (2008). On the etiology of conflict cultures, Research in Organizational Behavior, 28, 137-166.

A culture of inclusion helps leverage the potential benefits of diversity.

The Effects of Technology on Culture Using Intranets to Build and Maintain

Culture

Building and Maintaining Culture with Remote Employees

Effective managers use their company’s intranet to establish and reinforce a

desired culture.

Their scope. Intranets with a narrow scope can reinforce a culture of secrecy and information hoarding. Intranets that contain information on a variety of topics and links to other useful sites such as human resources, company and industry news, blogs, wikis, interviews with company leaders, and performance indicators reflect a culture of openness and teamwork.

Their openness to employee feedback and contributions. Intranets that contain “like it or not?” feedback tools and features that allow employees to contribute reflect a participative culture that values employee contributions. A more centralized, heavily edited and filtered site reflects a culture in which information flows less freely and employee contributions are less valued.

The frequency with which they are updated. Intranets that are rarely updated are not likely to influence the company’s culture and can reflect a culture that does not value employee contributions, has poor internal communication, and has poor attention to detail. Lucent updates its intranet multiple times a day if appropriate. It also posts two weekly feature articles that reinforce the strategic vision and positioning of the company to entice employees to visit multiple times each week.

The number of intranets. This refers to whether there is just one company intranet, or several, each serving different groups of employees. For example, some organizations have one intranet for the sales force and another, completely different looking one, for the R&D group.

The use of symbols, stories, and ceremonies. Because these express a company’s culture, intranets can convey such information via news of events affecting the organization, messages from CEOs, and announcements of employees’ awards programs of importance to the organization.

Organizational Change Incremental Change

Linear, continuous change

Transformative Change Radical change

Forces creating a need for change: Increased competition Globalization Changes in consumer demands Governmental regulations Deregulation Resource shortages

Lewin’s Model of Organizational Change

Kurt Lewin’s Force Field Analysis Model

Source: Lewin, K. (1951). Field theory in social science; selected theoretical papers. Copyright © 1951 by the American Psychological Association. Reprinted by permission of APA.

Four-Stage Model of the Change Process

Source: Northcraft, G.B., & Neale, M.A. (1994) Organizational Behavior: A Management Challenge. Hinsdale, IL: Dryden Press (2nd edition).

Kotter’s Change Phases Establish a sense of urgency Create a coalition Develop a clear vision for the change Share the vision Empower people to remove obstacles Secure short-term wins Build on the change Anchor the change in the corporate culture

Reactions to Change

Organizational Change

Constant change can decrease employees’ engagement.

Barriers to Change

Habits  Power and influence

Limited resources Misunderstandings

Saving face   Fear of the unknown

Tolerance for ambiguity

Organizational Change

Barriers to ChangeHabits: regular, stable patterns of events that become routines and take time to change

Power and Influence: people are likely to resist changes that threaten to reduce their power or influence

Limited Resources: insufficient resources (time, money, expertise, etc.) are a barrier to change

Misunderstandings: because misunderstandings increase uncertainty, they increase the chances that employees do not buy into the need for the change

Barriers to ChangeSaving Face: resisting a change to “prove” that another option was better or to try to demonstrate that the person championing the change is incompetent

Fear of the Unknown: many people are afraid of change because of the uncertainty over their future

Tolerance for Ambiguity: a personality trait reflecting the tendency to perceive ambiguous situations as desirable or as threatening

Overcoming Resistance to Change Communication Ensure that staffing and performance

appraisals support the change Participation Promote fairness perceptions Negotiation Manipulation and coercion Incentives Pilot programs Organization development

Organizational Change

Organizational Learning Learning organization

An organization that facilitates the learning of all its members and continually transforms itself

After-action review A professional discussion of an event that

enables discovery of what happened, why it happened, and how to sustain strengths and improve on weaknesses

Effective leaders make time for learning from both successes and failures.