Unit 4
Text C
Exercises
Text C Functions and Effects of Organizational Culture
1
The concept of organizational culture has its roots
in cultural anthropology. Just as there are cultures in
symbols, and passed down from generation to generation of employees.
2 The concept of cultures in organizations was alluded to as early as the Hawthorne studies, which described work group culture. However, the topic came into its own during the early 1970s, when managers and researchers alike began to search for keys to survival for organizations in a competitive and turbulent environment. Then in the early 1980s, several books on corporate culture were published, which found wide audiences, and research began in earnest on the elusive topic of organizational cultures. The definition adopted in this passage is that organizational (corporate) culture is a pattern of basic assumptions that are considered valid and that are taught to new members as the way to perceive, think, and feel in the organization.
The Fit Perspective
13 The “fit” perspective argues that a culture is good only if it fits the industry’s or the firm’s strategy. For example, a culture that values a traditional hierarchical structure and stability would not work well in the computer manufacturing industry, which demands fast response and a lean, flat organization. Three particular characteristics of an industry may affect culture: the competitive environment, customer requirements, and
8 Recently, some researchers reviewed three theories about the relationship between organizational culture and performance and the evidence that either supports or refutes these theories. The three are the strong culture perspective, the fit perspective, and the adaptation perspective.
11 To test the strong culture hypothesis, John Kotter and James Heskett selected 207 firms from a wide variety of industries. They used a questionnaire to calculate a culture strength index for each firm, and they correlated that index with the firm’s economic performance over a twelve-year period. They concluded that strong cultures were associated with positive long-term economic performance, but only modestly.
5 Third, culture reinforces the values in the organization. At Westinghouse’s Commercial Nuclear Fuel Division, for example, a cultural change was undertaken to achieve total quality as the number one value. All employees were involved in creating the quality plan, which won the coveted Baldrige National Quality Award.
10 Strong cultures are thought to facilitate performance for three reasons. First, these cultures are characterized by goal alignment; that is, all employees share common goals. Second, strong cultures create a high level of motivation because of the values shared by the members. Third, strong cultures provide control without the oppressive effects of a bureaucracy.
The Strong Culture Perspective 9 The strong culture perspective states that organizations with “strong” cultures perform better than other organizations. A strong culture is an organizational culture with a consensus on the values that drive the company and with an intensity that is recognizable even to outsiders. Thus, a strong culture is deeply held and widely shared. It also is highly resistant to change. One example of a strong culture is IBM’s. Its culture is one we are all familiar with: conservative, with a loyal workforce and an emphasis on customer service.
3 In an organization, culture serves four basic functions. First, culture provides a sense of identity to members and increases their commitment to the organization. When employees internalize the values of the company, they find their work intrinsically rewarding and identify with their fellow workers. Motivation is enhanced, and employees are more committed. 4 Second, culture is a sense-making device for organization members. It provides a way for employees so interpret the meaning of organizational events.
larger human society, there seem to be cultures within
organizations. These cultures are similahared, communicated through
6 Finally, culture serves as a control mechanism for shaping behavior. Norms that guide behavior are part of culture. At Westinghouse, employee suggestions increased fivefold following the emphasis on total quality. It became a norm to think of ways to improve processes at the division. 7 The effects of organizational culture are hotly debated by organizational behaviorists and researchers. It seems that managers attest strongly to the positive effects of culture in organizations, but it is difficult to quantify these effects.