The Influence of Leadership on Organizational Culture

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THE INFLUENCE OF LEADERSHIP ON ORGANIZATIONAL CULTURE

Leadership is a matter of intelligence, trustworthiness, humaneness, courage, and discipline . . . Reliance on intelligence alone results in rebelliousness. Exercise of humaneness alone results in weakness. Fixation on trust results in folly. Dependence on the strength of courage results in violence. Excessive discipline and sternness in command result in cruelty. When one has all five virtues together, each appropriate to its function, and then one can be a leader. — Sun Tzu

1Leadership is and has been described as the “process of social influence in which one person can enlist the aid and support of others in the accomplishment of a common task”[1]. A definition more inclusive of followers comes from Alan Keith of Genentech who said "Leadership is ultimately about creating a way for people to contribute to making something extraordinary happen[2]. Leadership is one of the most relevant aspects of the organizational context. However, defining leadership has been challenging. The following sections discuss several important aspects of the influence of leadership on organizational culture.

2.The importance of knowledge in organization has been highlighted as early as in 1890 by Alfred Marshall. However, its popularity has been accentuated only in the nineties[3]. The intensification of interest in knowledge management is driven by a host of factors which collectively reflect the urgent need for organization to manage knowledge. These factors include: (1) the increasing realization that wealth is generated from knowledge and intangible assets: (2) the rediscovery that human resource is the reservoir of organizational knowledge; (3) the rapid change in markets, competition and technology which demand continuous learning to remain competitive; (4) the recognition that innovation stems from knowledge creation and application; (5) the growing importance of cross-boundary knowledge transaction resulting from the globalization process; and (6) the technology limitations to unearth certain types of knowledge such as tacit knowledge[4].

3.Schein in particular described in details the significant roles of leadership in the creation and management of organizational culture throughout organizational growth; early life, midlife and maturity and decline. During the formation of organizations, leaders or founders have a major impact on how the early members of the organization define and solve their “external adaptation and internal integration problems” [5]. Since founders or leaders are usually entrepreneurs who have a high level of self-confidence and determination, they usually impose strong assumptions to their invented organizations. When their assumptions survive and successful in the business environment, the assumptions will be perceived as correct and eventually will be internalized as part of the organizational culture. Furthermore, founders or leaders tend to select other organizational members that have the similar assumptions and therefore strengthen the foundation of the organizational culture. Organizational members who have conflicting views on organizational culture tend to leave and thus creating a more homogeneous climate for those who remains. Schein proposed two types of mechanisms used by the leaders/founders to integrate their assumptions in the organizational culture.

4.In organizations, the secondary mechanisms are sometimes labeled as organizational climate and they are a reflection and manifestation of cultural assumptions derived from the leaders, especially at the initial formation of the organizations. These secondary mechanisms can become a powerful reinforcement of the primary mechanisms used by the leaders. The principles of using the secondary mechanisms are that they must be consistent with the primary mechanisms and leaders need to set an example.

5.The dynamics of midlife, maturity and declining organizations in...
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