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CSE & Enterprise Systems Center Lehigh University

1

Roger N. Nagel © 2006

Organizational Behavior and

Organizational Change

Organizational Culture

Roger N. Nagel

Senior Fellow & Wagner Professor

Lehigh University

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What Is Organizational Culture?

Characteristics:

1. Innovation and risktaking

2. Attention to detail

3. Outcome orientation

4. People orientation

5. Team orientation

6. Aggressiveness

7. Stabil ity

8. Agility

Characteristics:

1. Innovation and risktaking

2. Attention to detail

3. Outcome orientation

4. People orientation5. Team orientation

6. Aggressiveness

7. Stability8. Agility

Organizational Culture

A common perceptionheld by the organization’smembers; a system ofshared meaning.

Page 485

Page 485

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Culture Characteristics A Closer look

1. Innovation and risk taking.

The degree to which employees are encouraged to

do both

2. Attention to detail.

Degree to which employees are expected toexhibit precision, analysis, and attention to detail.

3. Outcome orientation.

Degree to which management focuses on resultsrather than on processes used to achieve them.

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Culture Characteristics A Closer look

4. People orientation.

Degree to which management decisions considerthe effect of outcomes on people within the

organization.

5. Team orientation. Degree to which work activities are organized

around teams rather than individuals.

6. Aggressiveness.

Degree to which people are aggressive and

competitive.

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Typical Organizational Culture USA

moderate AgilitymoderateStability

high Aggressiveness

moderateTeam orientation

moderatePeople orientation

moderateOutcome orientation

low Attention to detail

highInnovation and risk taking

IN USA

Nagel Opinion

Characteristics:

(high, moderate, low)

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Typical Organizational Culture USA & ChinaIN China

Your Opinion

moderate AgilitymoderateStability

high Aggressiveness

moderateTeam orientation





IN USA

Nagel Opinion

Characteristics:


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Individual and Team Exercise

Fill in the typical organizational culture USA &

china table which follows by your self.

For USA and China cultures use your best guess

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Read about organization A and organization

B in the two slides which follow.

Fill in the table following the descriptions

using your opinion for the culture of

organization A and organization B by your

self

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Contrasting Organizational Cultures

E X H I B I T 16–1

Page 487

E X H I B I T 16–1Page 487

Organization A

This organization is a manufacturing firm. Managers are expectedto 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 theirfunctional area or line of command. Performance evaluations and rewards emphasize individual

effort, although seniority tends to be the primary factor in thedetermination of pay raises and

promotions.

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Contrasting Organizational CulturesOrganization B

This organization is also a manufacturing firm. Here, however, management encourages

and rewards risk taking and change. Decisions based on intuitionare valued as much as

those that are well rationalized. Management prides itself on its history of experimentingwith new technologies and its success in regularly introducing innovation 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, andsupervision 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. E X H I B I T 16–1Page 487

E X H I B I T 16–1Page 487

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Fill in the tables which follows for your

organization

a. First characterize your organization as it is today,

and then indicate how you feel it should be in the

future.

b. On a separate piece of paper write down anexplanation of why you want to change your

organizational culture for any row in which you

have indicated a change is needed.

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Your Organizational Culture Today and in Future

Agility

Your Organization

Should be in future

Stability

Aggressiveness

Team orientationPeople orientation

Outcome orientation

Attention to detailInnovation and risk taking

Your Organization

today

Characteristics:


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Individual and Team Exercise Share your answers with your team

1. For USA and China cultures form a team consensus and

prepare to report it.2. For organizations A and Organization B form a team

consensus and prepare to report it.

3. Share your organizational culture today and in the futurechart with our teammates.

a. discuss the characteristics you desire to change and yourreasons for the changes.

b. Provide feedback to each team member.

c. identify a list of characteristics which several of you all feelmust change and prepare to report them

d. Explain your groups reasons for each characteristic andprepare to report them.

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Read about Organization A & B and Rate Them

highlow Agilitylow

moderate

highhigh

high

lowhigh

Organization B

Nagel Opinion

highStability

low Aggressiveness

lowTeam orientationlowPeople orientation

lowOutcome orientation

high Attention to detaillowInnovation and risk taking

Organization A

Nagel Opinion

Characteristics:


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Exercise A Team Reports

For USA and China cultures form a team consensus chart

with typical organizational culture in each country

For organizations A and organization B form a team

consensus chart with organization A & B ratings

Your organizational culture today and in the futurecommon list of characteristics which several of you feel

must change

Explain your reasons for each characteristic

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Do Organizations Have Uniform Cultures?

Dominant Culture

Expresses the core values thatare shared by a majority ofthe organization’s members.

Subcultures

Minicultures within an

organization, typically definedby department designationsand geographical separation.

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Do Organizations Have Uniform Cultures?

Core Values

The primary or dominant values that are acceptedthroughout the organization.

Strong Culture

A culture in which the

core values are intenselyheld and widely shared.

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What Do Cultures Do?

Culture’s Functions:

1. Conveys a sense of identity for its members.

2. Facilitates the generation of commitment to

something larger than self-interest.

3. Enhances the stability of the social system.

4. Serves as a sense-making and control mechanism

for fitt ing employees in the organization.

Culture’s Functions:1. Conveys a sense of identity for its members.

2. Facilitates the generation of commitment to

something larger than self-interest.

3. Enhances the stability of the social system.

4. Serves as a sense-making and control mechanism

for fitt ing employees in the organization.

Page 489Page 489

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Can define the boundary between one organization and others.

When there are cultural incompatibilities

Globally this is can significant concern

Consider our USA vs. China chartIN China

Your Opinion

moderate Agility

moderateStability

moderate AggressivenessmoderateTeam orientation





IN USA

Nagel Opinion

Characteristics:


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Which if any should be dealt withIntegrated

Collaborator

sometimes Agility

Collaborator

Stability

Aggressiveness

Team orientationPeople orientation

Outcome orientation

Attention to detail

Innovation and risktaking

subsidiarySupplier To be

Nagel view

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Culture as a Liabil ity:

1. Barrier to change.

2. Barrier to diversity

3. Barrier to collaboration

4. Barrier to acquisit ions and mergers

Culture as a Liability:

1. Barrier to change.

2. Barrier to diversity3. Barrier to collaboration

4. Barrier to acquisit ions and mergers

Page 491Page 491

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How Employees Learn Culture

• Leaders as role models

• Behavior of others• Stories

• Rituals

• Material Symbols• Language

• Leaders as role models

• Behavior of others

• Stories

• Rituals

• Material Symbols• Language

Page 498Page 498

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Creating An Ethical Organizational Culture

Characteristics of Organizations that Develop High

Ethical Standards High tolerance for risk

Low to moderate in aggressiveness

Focus on means as well as outcomes

Managerial Practices Promoting an Ethical Culture Being a visible role model.

Communicating ethical expectations.

Providing ethical training.

Rewarding ethical acts and punishing unethical ones.

Providing protective mechanisms.Page 500

Page 500

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Creating a Customer-Responsive Culture

Shaping Customer-Responsive Cultures

1. The types of employees hired by the organization.

2. Low formalization: the freedom to meet customer

service requirements.

3. Empowering employees with decision-making

discretion to please the customer.

4. Good listening skills to understand customer

messages.

5. Employees who engage in organizationalcitizenship behaviors.

Page 501Page 501

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Creating a Customer-Responsive Culture

Managerial Actions Actionable vision

» Lead by conveying a customer-focused vision

Role model

» demonstrating commitment to customers.» Provide ongoing recognition for employees who makespecial efforts to please customers

Provide an Agile organizational structure» Empower employees to make appropriate decisions

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Personal Exercise Choice A

What cultural changes should you be making

to be a more effective in meeting your globalbusiness goals1. Identify your global business goals

2. Is our current culture an asset or a deficit in

meeting your global business goals3. Explain how and or why (your answer in 2. above)

a. develop a plan for changes you need to make.

b. Identify benefits you expect, metrics for them

c. Obstacles you will face and how to overcome them.

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Personal Exercise Choice B

What cultural changes should you be makingto be a more effective in meeting your

domestic business goals1. Identify your domestic business goals

2. Is our current culture an asset or a deficit in

meeting your domestic business goals3. Explain how and or why (for your answer in 2.

above)a. develop a plan for changes you need to make.

b. Identify benefits you expect, metrics for themc. Obstacles you will face and how to overcome them.

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XIE XIE

Roger N. Nagel

Wagner Professor and Senior Fellow

CSE Department &

The Enterprise Systems Center at Lehigh University200 West Packer Avenue

Bethlehem, Pennsylvania, 18015

(610) 758-4086, (610) 868-0402 [fax]

[email protected]

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