Organizational Culture
Read this introduction to the role of culture in an organization. What is your organization's culture? Why is it essential to business strategy formulation and management?
Then, watch the video and consider how an enterprise culture might change established organizations' norms and behaviors.Organizational culture can be defined as the collective behavior of people within an organization and the meanings behind their actions.
LEARNING OBJECTIVE
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Define culture and it's conceptual development within the context of organizations and innovation
KEY POINTS
- Culture is inherently intangible, and a static definition of culture struggles to encapsulate the meaning and implications of its role in an organization.
- One way to define culture is simply as the overarching mentality and expectation of behavior within the context of a given group (e.g., an organization, business, country, etc.).
- Corporate culture is usually derived from the top down (i.e., upper management sets the tone) and comes in the form of expectation and consistency throughout the organization.
- Culture can be manipulated and altered depending on leadership and members. Instilling positive culture that promotes effective employee behavior is a manager's primary task.
- While there are many models for and perspectives on defining culture within an organization, models such as Geert Hofstede's, Edgar Schein's and Gerry Johnson's are useful in properly framing a comprehensive definition.
TERM
- culture
The beliefs, values, behavior, and material objects that constitute a people's way of life.
Culture is inherently intangible, and a static definition of culture struggles to encapsulate the meaning and implications of its role in an organization. One way to define culture is simply as the overarching mentality and expectation of behavior within the context of a given group (e.g., an organization, business, country, etc.). Culture provides a guiding perspective on how individuals within that group should act, and what meaning can be derived from those actions. Expectation, traditions, value, ethics, vision, and mission can all both communicate and reinforce a given group culture. Above all else, culture must be shared internally; otherwise it loses its form.
Culture in Business
Corporate culture is usually derived from the top down (i.e., upper management sets the tone) and comes in the form of expectation and consistency throughout the organization. All employees and managers must uphold these cultural expectations to generate a working environment that correlates to cultural expectations. The shared assumptions should be implicit in behavior and explicit in the mission, vision and ethics statements of the organization. Consistency between expectation and action is key here.
People working at Wikimedia
Even small things, such as the way an office space is set up, can set the tone for organizational culture.
Culture and Adaptability
Culture can be manipulated and altered, depending on leadership and members. Let's take the simple example of a car dealership. Selling cars is usually a commission business, where the salesperson is a central success factor. Many car dealerships
find that competition is an effective cultural component and embed that into the organization. This is easily accomplished with the right tools. A car dealership owner may hire specifically for competitiveness, making it clear that this is the type
of individual they want to hire. The owner can create high variable salary and low fixed salary so that high performers are much more highly prized and rewarded than ineffective salespeople. The owner could give out awards at the end of each quarter
to the most successful salesperson. The list could go on and on, but the important consideration here is how strategy and culture can be intertwined to evolve together.
Perspectives on Culture
Culture is a deeply important element of organizations and societies that is studied extensively in a variety of disciplines. This has generated more definitions of culture and how to go about empirically measuring it than could be touched upon in one overview. However, a few important perspectives for a business manager include:
- Hofstede's Cultural Dimensions Theory - Postulates that cultural differences to be aware of include different perspectives on power distance, masculinity (vs. femininity), individualism (vs. collectivism), avoidance of uncertainty, long-term orientation, and indulgence.
- Schein's Cognitive Levels of Organizational Culture - Edgar Schein believes that culture can be viewed most simply via artifacts (e.g., facilities, dress code, etc.), more acutely through values (e.g., focus on quality, loyalty or other central values) and most complexly through tacit assumptions (i.e., unspoken rules of behavior and other intangible expectations that are very difficult to observe and measure).
- Gerry Johnson's Cultural Web - This includes the elements of culture, which is an important aspect of how we define it. Johnson underlines the paradigm, control system, organizational structure, power structure, symbols, stories, and myths as central determinants of what a given organizational culture stands for.
While each of these theories is complex, all together they help create a clearer picture of what exactly culture is and how it applies to managers and organizations.
Source: Boundless
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