Shaping Culture and Values: Employee Behaviour So That Everyone's Actions Are Aligned With Strategic Priorities

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14.

SHAPING CULTURE AND VALUES


This chapter explores ideas about organizational culture and values, and the role of leaders
in shaping them. Most leaders recognize that culture is an important mechanism for
attracting, motivating, and retaining talented employees, a capability that may be the best
predictor of overall organizational excellence.

14.1. Organizational culture


Culture can be defined as the set of key values, assumptions, understandings, and norms
that is shared by members of an organization and taught to new members as correct.
Culture can be thought of as consisting of three levels: visible artefacts, values and beliefs,
and underlying assumptions.

Culture can be defined as the set of key values, assumptions, understandings, and norms
that is shared by members of an organization and taught to new members as correct. Norms
are shared standards that define what behaviours are acceptable and desirable. Culture can
be thought of as consisting of three levels, with each level becoming less obvious. At the
surface level are visible artefacts, such as manner of dress, patterns of behaviour, physical
symbols, and ceremonies – all the things you can see, hear, and observe by watching
members of the organization. At a deeper level of culture are the expressed values and
beliefs, which are not observable but can be discerned from how people explain and justify
what they do. These are values that members hold at a conscious level. At a third level are
the values that become so deeply embedded in a culture that members may not be
consciously aware of them. These underlying assumptions are the essence of the culture.

When people are successful at what they undertake, the ideas and values that lead to that
success become institutionalized as part of the organization’s culture. Culture gives
employees a sense of organizational identity and generates a commitment to particular
values and ways of doing things. Culture serves two important functions:
1. It integrates members so that they know how to relate to one another.
2. It helps the organization adapt to the external environment.

14.2. Culture strength, adaption, and performance

Culture strength refers to the degree of agreement among employees about the importance
of specific values and ways of doing things. A strong culture that encourages adaptation and
change enhances organizational performance by energizing and motivating employees,
unifying people around shared goals and a higher mission, and shaping and guiding
employee behaviour so that everyone’s actions are aligned with strategic priorities.

Culture strength refers to the degree of agreement among employees about the importance
of specific values and ways of doing things. If widespread consensus exists, the culture is
strong and cohesive. But the effect of a strong culture is not always positive, because it can
sometimes encourage the wrong values and cause harm to the organization and its
members. A strong culture that is unethical and does not encourage adaptation can be
more damaging to an organization than a weak culture.
Adapted cultures have different values and behaviour from un-adaptive cultures. In
adaptive cultures, leaders are concerned with customers and those internal people,
processes, and procedures that bring about useful change. In un-adaptive cultures, leaders
are concerned with themselves or their own special projects, and their values tend to
discourage risk taking and change. Thus, a strong culture is not enough, because an
unhealthy culture may encourage the organization to go the wrong way. An organization’s
culture may also not always be in alignment with the needs of the external environment.
The values and ways of doing things may reflect what worked in the past. The difference
between desired and actual values and behaviour is called the culture gap.

Culture plays an important role in creating an organizational climate that enableslearning


and innovative response to challenges, competitive threats, or new opportunities. A strong
culture that encourages adaptation and change enhances organizational performance by
energizing and motivating employees, unifying people around shared goals and a higher
mission, and shaping and guiding employee behaviour so that everyone’s actions are aligned
with strategic priorities. The right
culture can drive high performance. Strong adaptive cultures that facilitate high
performance often incorporate the following values:

1. The whole is more important than the parts and boundaries between parts are
minimized.
2. Equality and trust are primary values.
3. The culture encourages risk taking, change, and improvement.

In addition, high-performance cultures emphasize both values and solid business


performance as the drives of organizational success. Leaders align values with the
company’s day-to-day operations

14.3. Cultural leadership


Creating and maintaining a high-performance culture is not easy. Some of the mechanisms
leaders use to enact cultural values are organizational rites and ceremonies, stories,
symbols, and specialized language. They also emphasize careful selection and socialization
of new employees and signal the cultural values they want to instil in the organization
through their day-to-day behaviour.

People shape and interpret the character and culture of the organization, and different
people may perceive and relate to the organization in different ways. Leaders enact a
viewpoint ad a set of values that they think are best for helping the organization succeed. A
primary way in which leaders influence norms and values to build a high-performance
culture is through cultural leadership, which defines and uses signals and symbols to
influence corporate culture in two key areas:

1. The cultural leader articulates a vision for the organizational culture that employees
believe in.
2. The cultural leaders heeds day-to-day activities that reinforce the cultural vision.
Creating and maintaining a high-performance culture is not easy in today’s turbulent
environment and changing workplace. Some of the mechanisms leaders use to enact
cultural values are organizational rites and ceremonies, stories, symbols, and specialized
language. In addition, they emphasize careful selection and socialization of new employees
and signal the cultural values they want to instil in the organization through their day-to-day
behaviour.

A ceremony is a planned activity that makes up a special event and is generally conducted
for the benefit of an audience. It reinforces specific values, creates a bond among
employees by allowing them to share an important event, and anoints and celebrates
employees who symbolize important achievements.

A story is a narrative based on true events that is repeated frequently and shared among
employees. Leaders can use stories to illustrate the company’s primary values. A symbol is
an object, act, or event that conveys meaning to others. In a sense, stories and ceremonies
are symbols, but leaders can also use physical artefacts to symbolize values.

Language can shape and influence organizational values and beliefs. Leaders sometimes use
slogans or sayings to express corporate values. These slogans or sayings can easily be picked
up and repeated by employees. Leaders also express and reinforce cultural values through
written public statements, such as corporate mission statements.

To maintain cultural values over time, leaders emphasize careful selection and socialization
of new employees. Companies with strong, healthy cultures often have rigorous hiring
practices. Once the right people are hired, the next step is socializing them into the culture.
Socialization is the process by which a person learns the cultural values, norms, and
behaviours that enable him to fit in with a group or organization.

One of the most important ways leaders build and maintain cultures is by signalling and
supporting important values through their daily actions. Employees learn what is valued
most in a company by watching what attitudes and behaviours leaders pay attention to and
reward, how leaders react to organizational crises, and whether the leader’s own behaviour
matches these values. Leaders can also change un-adaptive cultures by their actions.

14.4. The competing values approach to shaping culture


Organizational cultures can be assessed along many different dimensions. Four categories
of culture associated with these differences are adaptability, achievement, clan, and
bureaucratic.
Organizational values are the enduring beliefs that have worth, merit, and importance for
the organization. The economic crisis, the breakdown of corporate ethics, and the crash of
once-thriving companies, but also changes in the nature of work, globalization, and
increasing diversity have brought values to the forefront.
Organizational cultures can be assessed along many different dimensions, such as the extent
to which the competitive environment requires flexibility or stability, and the extent to
which the organization’s strategic focus and strength is internal or external. Four categories
of culture associated with these differences are adaptability, achievement, clan, and
bureaucratic. They relate to the fit among cultural values, strategy, structure, and
environment. An organization may have cultural values that fall into more than one
category, or even into all of them, but successful organizations with strong cultures will lean
more toward one particular category.

The adaptability culture is characterized by strategic leaders encouraging values that


support the organization’s ability to interpret and translate signals from the environment
into new behaviour responses. Employees have autonomy to make decisions and act freely
to meet new needs, and responsiveness to customers is highly valued. Leaders also actively
create change by encouraging and rewarding creativity, experimentation, and risk taking.

The achievement culture is characterized by a clear vision of the organization’s goals and
leaders’ focus on the achievement of specific targets, such as sales growth, profitability, or
market share. An organization concerned with specific customers in the external
environment but without the need for flexibility and rapid change is suited to this culture
that values competitiveness, aggressiveness, personal initiative, and the willingness to work
long and hard to achieve results.

The clan culture has an internal focus on the involvement and participation of employees to
meet changing expectations from the external environment. This culture places value on
meeting the needs of organization members. Leaders emphasize cooperation, consideration
of both employees and customers, and avoiding status differences. They put a premium on
fairness and reaching agreement with others.

The bureaucratic culture has an internal focus and consistency orientation for a stable
environment. This culture supports a methodical, rational, orderly way of doing business.
Following the rules and being thrifty are valued. The organization succeeds by being highly
integrated and efficient.

14.5. Ethical values in organizations


In general, ethics is the code of principles and values that governs the behaviour of a
person or group with respect to what is right or wrong. It sets the standards as to what is
good or bad in conduct and decision making.
Ethical values are considered highly important for leaders and have gained renewed
emphasis in today’s era of financial scandals and moral lapses. In general, ethics is the code
of principles and values that governs the behaviour of a person or group with respect to
what is right or wrong. It sets the standards as to what is good or bad in conduct and
decision making. Ethics often goes beyond the law.

Most organizations that remain successful over the long term have leaders who include
ethical values as part of the formal policies and informal cultures of their companies.
Leaders can create and sustain a climate that emphasizes ethical behaviour for all
employees. Changing how future leaders are trained could be one key to solving the ethics
deficit pervading organizations.
14.6. Values-based leadership
Ethical values in organizations are developed and strengthened primarily through values-
based leadership, a relationship between leaders and followers that is based on shared,
strongly internalized values that are advocated and acted upon by the leader. Leaders
influence ethical values through their personal ethics and by practicing spiritual
leadership.

Ethical values in organizations are developed and strengthened primarily through values-
based leadership, a relationship between leaders and followers that is based on shared,
strongly internalized values that are advocated and acted upon by the leader. Leaders
influence ethical values through their personal ethics and by practicing spiritual leadership.

Values-based leaders generate a high level of trust and respect from employees, based not
just on stated values, but on the courage, determination, and self-sacrifice they
demonstrate in upholding those values. Several factors contribute to a leader’s ethical
stance. Every individual brings a set of personal beliefs, values, personality characteristics,
and behaviour traits to the job. Family backgrounds and spiritual beliefs of leaders also
often provide principles by which they conduct business. One important personal factor is
the leader’s stage of moral development, which affects an individual’s ability to translate
values into behaviour. Leaders have to discover their own personal ethical values and
actively communicate values to others. When faced with a difficult decision, values-based
leaders know what they stand for and they have the courage to act on their principles.

Spiritual leadership is the display of values, attitudes, and behaviours necessary to


intrinsically motivate oneself and others toward a sense of spiritual expression through
calling and membership. Managers who incorporate spiritual values in addition to the
traditional mental and behavioural aspects of leadership tend to be successful. Values and
practices considered as spiritual ideas include integrity, humility, respect, appreciation for
the contributions of others, fair treatment, and personal reflection.

Spiritual leaders start by creating a vision through which organization participants


experience a sense of calling that gives meaning to their work. An appropriate vision would
have broad appeal, reflect high ideals, and establish a standard of excellence. Second,
spiritual leaders establish a corporate culture based on altruistic love, including forgiveness,
genuine caring, compassion, kindness, honesty, patience, courage, and appreciation, which
enables people to experience a sense of membership and feel understood. Spiritual leaders
also engage hope and faith to help the organization achieve desired outcomes. Faith is
demonstrated through action and means believing in the ability to excel, exercising self-
control, and striving for excellence to achieve a personal best. A leader’s hope and faith
includes perseverance, endurance, stretch goals, and a clear expectation of victory through
effort. Spiritual leadership behaviours enable employees to have a sense of calling that
provides deeper life meaning through work. It also provides a sense of membership though
a work community in which one feels understood and appreciated. The outcome for the
organization is improved commitment and productivity.

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