Unit 6

Organizational culture
Meaning and concept of organizational culture
• Organizational culture is defined as the underlying beliefs,
assumptions, values and ways of interacting that contribute to
the unique social and psychological environment of an
organization.
• Organizational culture reflects an organization’s values, vision,
working style and beliefs. It influences how an organization
conducts its business and helps regulate and control employees’
behaviour.
• Organizational culture shows the ways the organization conducts
its business, teats its employees, customers and the public at large.
• Organization culture is unique for every organization and much
difficult to change in a short time.
• Organization’s structure, system, behaviour, values and leadership
style are the factors that can influence organizations culture.
Importance of organization culture
1. Generates commitment
2. Promotes healthy competition
3. Guides for orientation
4. Conveys a sense of identity
5. Decreased turnover
6. Healthy team environment
7. Enhances stability
8. Develops control mechanism
9. Encourages self motivation
1.Generates commitment:
• The culture decides the way employees interact at their
workplace. A healthy culture encourages the employees to stay
motivated and loyal towards the management.
2. Promotes healthy competition
• The culture of the workplace also goes a long way in
promoting healthy competition at the workplace.
• Employees try their level best to perform better than their
fellow workers and earn recognition and appreciation of the
superiors.
• It is the culture of the workplace which actually motivates the
employees to perform.
3. Guides for orientation
• Every organization must have set guidelines for the employees
to work accordingly.
• The culture of an organization represents certain predefined
policies which guide the employees and give them a sense of
direction at the workplace.
• Every individual is clear about his roles and responsibilities in
the organization and know how to accomplish the tasks ahead
of the deadlines.
4. Conveys a sense of identity
• No two organizations can have the same work culture. It is the
culture of an organization which makes it distinct from others.
• The work culture goes a long way in creating the brand image
of the organization. The work culture gives an identity to the
organization. In other words, an organization is known by its
culture.
5.Decreased turnover
• People who feel valued and respected at a company are less
likely to leave it. That's why it's essential for brands to foster a
winning organizational culture that supports their core values
and mission statement.
• Happy employees mean less turnover, which saves companies
time and money in the hiring process. Companies that achieve
6. Healthy team environment
• Organizational culture helps improve workflows and guides the
decision-making process. It also helps teams overcome barriers
of ambiguity.
• Team members who are informed and knowledgeable about
certain processes are often more motivated to finish projects.
Having a clear culture that unifies employees and promotes
organized work structures helps people work together with
purpose.
7. Enhances stability
• Organizational culture enhances the stability of the social
system.
• They do assign jobs through mutual support and guidance.
• It facilitates the enhancement the stability of the workforce in
8. Develop control mechanism
• It provides the employees to get an opportunity to set the
standards for doing activities and providing services.
• They try to achieve the standards on the basis of their best
ability.
• It becomes a self control mechanism that help the organization
that help the organization to grow and flourish.
9. Encourages self motivation
• It can make a person generate a sense of identity, a sense of
belonging and a sense of security and play the role of mutual
encouragement.
10. Guides of orientation
• It emphasizes guiding the behaviour of members of the
enterprise from the shaping organizational culture.
• It facilitates making employees accept the common values of
the organization.
Change and strengthen organizational culture
1.ACTIONS OF FOUNDERS AND LEADERS
• An organization’s culture begins with its founders and leaders.
Founders set the tone, emphasizing what is most important and
what should receive a lower priority.
• They are often visionaries who provide a powerful role model
for others to follow. Experts suggest that the company’s culture
sometimes reflects the founder’s personality, and this cultural
imprint often remains with the organization for decades.
• Founders and leaders need to symbolize the new culture
through showing the unique memorable events or activities.
• How founders and managers show actions and behaviour in
organizational activities will become the system and culture for
future activities.
2.Aligning artifacts
• Artifact is the visible part of an organisation. Example are
processes and structure. Artifacts represent more than just the
visible indicators of a company’s culture. They are also
mechanisms that keep the culture in place.
• Thus by altering these artifacts—or creating new ones—
managers can potentially adjust organizational culture. Stories
represent a type of artifact that can help to reshape an
organization’s culture.
• Leaders can play an active role in creating memorable events
that later become stories.
3. Introducing culturally consistent rewards
• Rewards include both financial and non financial incentives
provided to the employees based on their skills, efficiency and
job responsibility.
• Every organization involves specified rules , norms values and
standard that every employee should consider while behaving
within the teams and treating outside stakeholders.
• The provision of culturally consistent rewards both for
employees and managers supports change and strengthens
organization culture.
• Manager- level staff should be rewarded who helping the
subordinates for understanding the organization culture.
Similarly, subordinate level staff should be rewarded for their
culturally consistent behaviour.
4.Selecting and socializing employees
• Job applicants also pay attention to corporate culture during the hiring
process.
• They realize that as employees, they must feel comfortable with the
company’s values, not just the job duties and hours of work. Thus job
applicants tend to look at corporate culture artifacts when deciding
whether to join a particular organization. By diagnosing the
company’s dominant culture, they are more likely to determine
whether its values are compatible with their own.
• Along with selecting people with compatible values, companies
maintain strong cultures through the process of organizational
socialization: the process by which individuals learn the values,
expected behaviors, and social knowledge necessary to assume their
roles in the organization.
• If the company’s dominant values are communicated, job candidates
and new hires are more likely to internalize these values quickly and
Socialization three stage:
Pre-arrival stage
Encounter stage
Metamorphosis stage
1. Pre-arrival stage
In other words, pre-arrival refers to all the learning that occurs before
a new member joins the organisation.
2. Encounter stage
• Upon entry into organisation, the new member enters the encounter
stage. The role playing starts here. The member starts comparing
expectations, the image of the organisation which he had formed
during pre-arrival phase with reality.
• If expectations and reality concur the encounter is smooth. But
seldom has it concurred. When the two differ, stress and frustration
• In the process of adjustment, the individual tries to replace
his/her own values and norms with those of the organisation.
At the other extreme, the member simply cannot reconcile to
those values and norms of the organisation and gets
disillusioned and quits the job.
3. Metamorphosis stage :
• In this stage, the member masters the skills required to adjust
with the organisation’s norms and values.
• This is a stage going through changes. Hence, this is called
meta­morphosis stage.
• This is, of course, a voluntary process and a conscious
decision which enables the new member to become compatible
with the organisation. This signals the completion of
socialisation process.
Managing organizational culture during merger
1. Assimilation
2. Deculturation
3. Integration
4. Separation

1.Assimilation:
• Assimilation occurs when employees at the acquired company
willingly embrace the cultural values of the acquiring
organization.
• Corporate cultural clashes are less likely to occur with this
strategy because the acquired company often has a weak,
dysfunctional culture, whereas the acquiring company’s
2. Deculturation
• Assimilation is rare. Employees usually resist organizational
change, particularly when they are asked to throw away
organizational values that were similar to their personal values.
• Under this, the acquiring company imposes its culture on acquired
company forcefully.
• The old culture of the acquired company is ignored and demolished
• People who cannot adopt the acquiring company’s culture are often
terminated.
• Deculturation may be necessary when the acquired firm’s culture
doesn’t work but employees aren’t convinced of this.
• However, this strategy is difficult to apply effectively because the
acquired firm’s employees resist the cultural intrusions from the
buying firm, thereby delaying or undermining the merger process.
3. Integration
• A third strategy is to combine the cultures of both acquired and
acquiring company to form a new culture.
• Integration is slow and potentially risky because many forces
preserve the existing cultures.
• Still, this strategy should be considered if the existing culture
can be improved. . Integration also works best when people
realize that their existing cultures are ineffective and are
therefore motivated to adopt the new culture..
4. Separation
• A separation strategy occurs when the merging companies
agree to keep their own corporate culture and practices.
distinct entities with minimal exchange of culture or
organizational practices.
• This strategy is most appropriate when merging companies are
in unrelated industries or operate in different countries.
• Usually, separation strategy doesn’t last for the long period
because managers of the acquiring company face difficulty for
effective management of acquired company.
Managing organizational culture during merger
Organizational culture in Nepalese organization
• Lack corporate culture
• One-way communication
• Unethical behaviour
• Workforce diversity
• Role model leaders
• Social responsibility
• Lack long term planning
• Dysfunctional conflict
• Gender difference
• Resistance to change