Organizational Culture and Structure
“Simply, a company’s structure and design can be viewed as its body, and its culture as its soul.”-- Naomi Cossak
The Effects of Organizational Culture and Structure
The behavior patterns in the organization are the elements for execution of the strategy—creating value in the market The organizational culture and structure will define the limitations and possibilities for behavior patterns Operationally, the acceptable behavior patterns are controlled through the HR System: Organizational Employees
(Capabilities, personalities, values, interests of employees, etc.) HR Programs
(Personnel selection, compensation, development, evaluation, etc.) HR Policies
(Promotion, reward, retention, communication, etc.)
What is an Organizational Culture?
Culture emerges from a set of basic assumptions and core values shared by the members of the organization. Those values shape the way they perceive, respond and behave in carrying out their organizational responsibilities.
Organizational Culture is Manifest at Multiple Levels
Basic and Implicit (Hidden)
Patterns of Behavior
Artifacts and Symbols
Manifest in Organizational Process
The Importance of Culture in Executive Thinking
Nine of ten executives have indicated that culture is as important as strategy in organizational success Darrell Rigby “Organizational culture and so-called softer issues are now top of mind. Executives are clearly looking beyond cost cutting for success.” Lou Gerstner (IBM) stated that “. . . culture isn’t just one aspect of the game – it is the game.” Peter Drucker “Culture eats strategy for breakfast”
Corporate Culture and Organizational Performance
A classic study by Kotter and Heskett showed that organization culture can be a key factor in bottom line success. Organizations with performance enhancing cultures outperformed others in revenue growth, employment growth, stock price growth and net income growth.
The emerging role of “Chief Culture Officer” – takes initiatives to drive the cultural values and collect metrics to track behavior relating to the values, employee engagement and participation in the initiatives.
The company’s CEO is generally felt to be the most responsible for influencing the company’s culture and values
How Does an Organizational Culture Form?
An organization’s culture can be formed and shaped from one or more sources. Some of the most important sources of cultural formation are: Organizational founder (key values and beliefs of creator/ first leader of the organization) Threats & Challenges to organizational viability (environmental threats) Key idea or value (basic value around which an organization builds itself)
Culture and the Reward System
The reward system can be a useful indicator of the organizational culture -- it defines the relationship and terms of exchange between the individual and the organization, the contributions expected and norms of behavior, the response individuals can expect to receive as a result of their performance and is an unequivocal statement of the organizational values and beliefs.
Organizational Culture is Expressed Through the Following:
Stories about what makes the organization meaningful,
routines in carrying out daily activity,
language and images used,
heroes and villains,
systems and processes,
reward and recognition systems.
What is the Difference Between a Company’s Mission, Vision and Value Statements? Mission statement – explains the company’s reason for existence Vision statement – describes the organization in a future successful state Values statement – defines the beliefs and principles of the company’s culture
Corporate Values that Shape Culture
Examples of Hewlett-Packard, NCR, Microsoft, Google and 3M
Some Types of Organizational...
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