UNIT 4: Conflict

Management &
Organizational Culture
4.2: Chapter Contents
Organizational Culture:
Meaning and Nature of Organization Culture
 Origin of Organization Culture
Functions of Organization Culture
Types of Culture
Creating and Maintaining Organization Culture
 Managing Cultural Diversity.
Organizational Culture:

 Reflects employees’ views about “the way

things are done around here.”
 The culture specific to each firm affects how
employees feel and act and the type of
employee hired and retained by the company.
“I can’t defIne It,
but I know it when
I see It.”
According to a 2019 Glassdoor study, 77 percent of
adults would evaluate a company’s culture before
applying to an open position, with more than half
ranking an organization’s organizational culture as
more important than compensation. And an SHRM
study from 2021 revealed that 94 percent of people
managers believe a positive workplace culture helps
retain employees.
 Organizational culture refers to a system of shared meaning held by members that
distinguishes the organization from other organizations.
 A common perception held by the organization’s members; a system of shared meaning
 Research identifies primary characteristics that capture the essence of an organization’s
culture:
 Innovation and risk taking
 Attention to detail
 Outcome orientation
 People orientation
 Team orientation
 Aggressiveness
 Stability
 Reward System
 Management support
 Conflict tolerance
 Integration
 Control
 Communication patterns
 Culture. – The learned, shared way of doing things in a particular
society.
 The “software of the mind.”
 Helps define boundaries between different groups and affects
how their members relate to one another.
 Cultural intelligence is the ability to identify, understand, and act
with sensitivity and effectiveness in cross-cultural situations.
 Organizational culture is concerned with employees’ perceptions
of the characteristics of the culture, not whether they like them.
 Does it encourage teamwork?
 Does it reward innovation?
 Does it stifle initiative?
 Culture is a descriptive term: it may act as a substitute for
formalization
Organization A
 This organization is a manufacturing firm. Managers are expected to fully document all
decisions, and “good managers” are those who can provide detailed data to support their
recommendations.
 Creative decisions that incur significant change or risk are not encouraged. Because
managers of failed projects are openly criticized and penalized, managers try not to
implement ideas that deviate much from the status quo. One lower-level manager quoted
an often-used phrase in the company: “If it ain’t broke, don’t fix it.”
 There are extensive rules and regulations in this firm that employees are required to follow.
 Managers supervise employees closely to ensure there are no deviations. Management is
concerned with high productivity, regardless of the impact on employee morale or turnover.
 Work activities are designed around individuals. There are distinct departments and lines of
authority, and employees are expected to minimize formal contact with other employees
outside their functional area or line of command. Performance evaluations and rewards
emphasize individual effort, although seniority tends to be the primary factor in the
determination of pay raises and promotions.
Organization B
 This organization is also a manufacturing firm. Here, however, management encourages
and rewards risk taking and change. Decisions based on intuition are valued as much as
those that are well rationalized. Management prides itself on its history of experimenting
with new technologies and its success in regularly introducing innovative products.
Managers or employees who have a good idea are encouraged to “run with it.” And
failures are treated as “learning experiences.” The company prides itself on being market
driven and rapidly responsive to the changing needs of its customers.
 There are few rules and regulations for employees to follow, and supervision is loose
because management believes that its employees are hardworking and trustworthy.
Management is concerned with high productivity but believes that this comes through
treating its people right. The company is proud of its reputation as being a good place to
work.
 Job activities are designed around work teams, and team members are encouraged to
interact with people across functions and authority levels. Employees talk positively about
the competition between teams. Individuals and teams have goals, and bonuses are
based on achievement of these outcomes. Employees are given considerable autonomy
in choosing the means by which the goals are attained.
Functions of Organizational Culture?
What role does culture perform? Cultures can be positive or negative for
organizations.
 Boundary-defining role.
 Conveys a sense of identity for members.
 Facilitates the generation of commitment.
 Enhances the stability of the social system.
 Serves as a sense-making and control
mechanism.
 Defines the rules of the game.
Types of Organizational Culture: Organizational
culture can vary in a number of ways. It is these
variances that differentiate one organization from
the others. Some of the bases of the differentiation
are presented below :
 1. Strong vs weak culture : Organizational culture can be
labelled as strong or weak based on sharedness of the core
values among organizational members and the degree of
commitment the members have to these core values. The
higher the sharedness and commitment, the stronger the
culture increases the possibility of behavior consistency
amongst its members, while a weak culture opens avenues
for each one of the members showing concerns unique to
themselves.
 Soft vs hard culture : Soft work culture can emerge in an
organization where the organization pursues multiple and
conflicting goals. In a soft culture the employees choose to
pursue a few objectives which serve personal or sectional
interests. A typical example of soft culture can be found in a
number of public sector organizations in India where the
management feels constrained to take action against
employees to maintain high productivity. The culture is welfare
oriented; people are held accountable for their mistakes but
are not rewarded for good performance. Consequently, the
employees consider work to be less important than personal
and social obligations.
 Formalvs informal culture : The work culture of an
organization, to a large extent, is influenced by the
formal components of organizational culture. Roles,
responsibilities, accountability, rules and regulations
are components of formal culture. They set the
expectations that the organization has from every
member and indicates the consequences if these
expectations are not fulfilled.
How Culture Originates
 Stems from the actions of the founders:
 Founders hire andkeep only employees who think and
feel the same way they do.
 Founders indoctrinate and socialize these employees
to their way of thinking and feeling.
 The founders’ own behavior acts as a role model that
encourages employees to identify with them and
thereby internalize their beliefs, values, and
assumptions.
Keeping Culture Alive
 Selection
 Concerned with how well the candidates will fit
into the organization
 Providesinformation to candidates about the
organization
 Top Management
 Senior executives help establish behavioral norms
that are adopted by the organization
 Socialization
 The process that helps new employees adapt to
the organization’s culture
Walt Disney – Where the happiest
place on earth is the happiest place to
work
Walt Disney is not just one of the most
recognizable brands in the world. They
are also the kindest community on the
planet. A brand that is almost
synonymous with magic, Disney
extends the magical experience to its
The Disney employee benefits include access to
employees and organizational culture. Mickey’s Retreat (an exclusive area only for cast
What sets them apart: According to members and their families), generous discounts on
one Disney employee, it’s their Disney parks, hotels and merchandise, incentive
schemes, and private healthcare. Magical, isn’t it?
unparalleled heritage, pride and Takeaway: All the fancy office furniture, designer
culture, wonderful community, juice bars, and loud vodka parties don’t really
amazing growth opportunity and a matter if people aren’t nice to each other. This type
of organizational culture strives to make every
creative atmosphere. Disney only hires place the happiest place to work.
people who align with what they stand
for.
Culture creation occurs in three ways: First, founders hire and keep
only employees who think and feel the way the way they do. Second,
they indoctrinate and socialize these employees to their way of thinking
and feeling.
The founders’ own behavior acts as a role model that encourages
employees to identify with them and thereby internalize their beliefs,
values, and assumptions.
When the organization succeeds, the founders’ entire personality
becomes embedded in the culture of the organization.
1. There are practices within the organization that act to maintain it by
giving employees a set of similar experiences.
2. Three forces play a particularly important part in sustaining a culture:
selection practices, the actions of top management, and socialization
methods.
Stages in the Socialization Process
 Pre-arrival
 The period of learning prior to a new employee joining the organization
 Encounter
 When the new employee sees what the organization is really like and
confronts the possibility that expectations and reality may diverge
 Metamorphosis
 When the new employee changes and adjusts to the work, work group,
and organization
Summary: How Organizational
Cultures Form
 Organizational cultures are derived from the founder
 They are sustained through managerial action
How Employees Learn Culture
 Stories
 Anchor the present into the past and provide explanations and
legitimacy for current practices
Eg: Henry Ford to arrogant employees-”It’s my name that’s on the
building”
Narratives about organization’s founders, rule breaking, rags to
riches successes, workforce reductions, relocations, reactions to
past mistakes, organizational coping
 Rituals
 Repetitive sequences of activities that express and reinforce
the key values of the organization
 Eg: Kimpton Hotels & Restaurants: Housekeeping Olympics
 United Entertainment Group: Unusual Working hours by CEO
Jarrod Moses
 Material Symbols
 Acceptable attire, office size, opulence of the office furnishings,
and executive perks that convey to employees who is important
in the organization
 Eg: Adidas Gurugram Office-Large free Gym used by 200
employees daily.
 C.E.Os. driving Company Cars, Company Brands
 Autodesk-Bring your Dog to work
 Genentech-Biotech Leader: 7 weeks paid leave for every 5 years
of service.
 Language
 Jargon and special ways of expressing one’s self to indicate
membership in the organization
 Eg: Acronyms used, jargons used in the organization
The TATA Story
Heritage Walk:

https://www.tata.com/about-us/tata-group-our-heritage/tata-
heritage-walk

 Solo Walk (via App)

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Cultural diversity is
about appreciating that society is
made up of many different groups
with different interests, skills, talents
and. needs. It also means that you
recognise that people in society
can have differing religious beliefs
and sexual orientations to you.
Managing Cultural Diversity:
 Communication: people from different cultures vary in how, for example,
they react to bad news. People from some Asian cultures are reluctant to
give supervisors bad news – while those from other cultures may
exaggerate it.
 Team-Building: Some cultures – like the United States – are individualistic,
and people want to go at it alone. Other cultures value cooperation within
or among other teams. Team-building issues can become more
problematic as teams are comprised of people from a mix of these cultural
types.
 Time: Cultures differ in how they view time. For example, they differ in the
balance between work and family life, and the workplace mix between
work and social behavior. Other differences include the perception of
overtime, or even the exact meaning of a deadline. Different perceptions
of time can cause a great misunderstanding and mishap in the workplace,
especially with scheduling and deadlines.
 Schedules: Work can be impact by cultural and and religious events. The business
world generally runs on the western secular year, beginning with January 1 and
ending with December 31. But some cultures use wildly different calendars to
determine New Years or specific holy days. For example, Eastern Orthodox Christians
celebrate Christmas on a different day from western Christians. For Muslims, Friday is a
day for prayer. Jews observe holidays ranging from Rosh Hashanah to Yom Kippur.
 Understanding Cultural Differences: In a study published by the Harvard Business
Review, it was found that organisations that fostered an understanding of cultural
differences and encouraged cross-cultural collaboration had a 45% increase in
innovation, compared to organisations that did not prioritise diversity and inclusion.
 Promoting Cultural Awareness
A survey by the Society for Human Resource Management found that companies with
diverse and inclusive cultures outperformed their peers by as much as 35%. Their most
recent research, done with Harvard Business Review Analytic Services and the Society
for Human Resource Management (SHRM), looks at how much diversity, equity, and
inclusion (DEI) are strategic priorities in organizations, how companies are implementing
DEI initiatives, and how successful they are (leaders) or not (laggards) at creating a DEI-
friendly culture.
Summary and Managerial
Implications
 Strong cultures are difficult for managers to change
 Inthe short run, strong cultures should be
considered fixed
 Selecting new hires that fit well in the organizational
culture is critical for motivation, job satisfaction,
commitment, and turnover
 Socialization into the corporate culture is important
 As a manager, your actions as a role model help
create the cultural values of ethics, spirituality, and a
positive culture
Organizational cultures often reflect
national culture. The culture at AirAsia, a
Malaysian-based airline, emphasizes
informal dress so as not to create status
differences. The carrier has lots of parties,
participative management, and no private
offices, reflecting Malaysia’s relatively
collectivistic culture. The culture of US
Airways does not reflect the same degree of
informality. If US Airways were to set up
operations in Malaysia or merge with
AirAsia, it would need to take these cultural
differences into account.
The Zappos office in Las Vegas, Nevada
 Driven by ten core values which define their culture, brand, and business
strategies, Zappos employees enjoy free lunches, no-charge vending
machines, a company library, a nap room, and free health care. And with
an astounding 75% of their customers coming back for more, Zappos is
one of the best examples of a loyalty business model and relationship
marketing system that works.
 What can a small business owner learn from the Zappos company culture
model? A lot. If you want to build a company that attracts and retains
loyal employees and customers, creating your own unique culture needs
to be a top priority.
 Dr. David "Doc" Vik is the founder and CEO of The Culture King and was
the coach at Zappos where he helped drive the company culture. "Keep
in mind, that within all companies, there is already a culture," says Vik. "But
it may not be what is wanted, and many times, the culture is created by
default." If you want to create your own unique culture that will help
empower your employees and drive your company to success,
transforming the culture you already have is a great place to start.