chapter 3 - baird

8/7/2019 Chapter 3 - Baird

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Organizational Culture andOrganizational Culture and

LeadershipLeadership

Chapter 3Chapter 3


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Organizational Culture DefinedOrganizational Culture Defined

The basic pattern of shared assumptions,The basic pattern of shared assumptions,

values, and beliefs considered to be thevalues, and beliefs considered to be the

correct way of thinking about and actingcorrect way of thinking about and acting

on problems and opportunities facing theon problems and opportunities facing the

organization.organization.

Courtesy of VanCity


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Physical StructuresPhysical Structures

LanguageLanguage

Rituals and CeremoniesRituals and Ceremonies

Stories and LegendsStories and Legends

Communication NetworksCommunication Networks

HistoryHistory

BeliefsBeliefs

ValuesValues

AssumptionsAssumptions

Artifacts of

Organizational

Culture

OrganizationalOrganizational

CultureCulture

Elements of Organizational CultureElements of Organizational Culture


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Artifacts: Stories and LegendsArtifacts: Stories and Legends

(Heroes)(Heroes)Social prescriptions of desiredSocial prescriptions of desired(undesired) behavior(undesired) behavior

Provides a realistic human side toProvides a realistic human side toexpectationsexpectations

Most effective stories and legends:Most effective stories and legends:

Describe real peopleDescribe real people Assumed to be trueAssumed to be true

Known throughout the organizationKnown throughout the organization

Are prescriptiveAre prescriptive


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Artifacts: Rituals and CeremoniesArtifacts: Rituals and Ceremonies

RitualsRituals

programmed routinesprogrammed routines

(eg., how visitors are greeted)(eg., how visitors are greeted)

CeremoniesCeremonies

planned activities for an audienceplanned activities for an audience (eg., award ceremonies)(eg., award ceremonies)


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Artifacts: Physical Structures/SymbolsArtifacts: Physical Structures/Symbols

Building structureBuilding structure ---- may shape and reflectmay shape and reflectcultureculture Oakleys Interplanetary Headquarters in FoothillOakleys Interplanetary Headquarters in Foothill

Ranch, CaliforniaRanch, California

Office design conveys cultural meaningOffice design conveys cultural meaning

Furniture, office size, wall hangingsFurniture, office size, wall hangings


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Artifacts: OrganizationalArtifacts: Organizational

LanguageLanguageWords used to address people, describeWords used to address people, describecustomers, etc.customers, etc.

Leaders use phrases and special vocabularyLeaders use phrases and special vocabularyas cultural symbolsas cultural symbols

eg. Container Stores Being Gumbyeg. Container Stores Being Gumby

Language also found in subculturesLanguage also found in subcultures

eg. Whirlpools PowerPoint cultureeg. Whirlpools PowerPoint culture


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Artifacts: Cultural CommunicationArtifacts: Cultural Communication

NetworksNetworks Refers to the informal channels ofRefers to the informal channels of

interaction, typically used for influencinginteraction, typically used for influencing

members perceptions of reality andmembers perceptions of reality andindoctrinating them to hold the right andindoctrinating them to hold the right andbehave in the appropriate ways.behave in the appropriate ways.


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Organizational SubculturesOrganizational Subcultures

Located throughout the organizationLocated throughout the organization

Can enhance or oppose (countercultures)Can enhance or oppose (countercultures)firms dominant culturefirms dominant culture

Two functions of countercultures:Two functions of countercultures: provide surveillance and critique, ethicsprovide surveillance and critique, ethics

source of emerging valuessource of emerging values


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Types of Organizational CulturesTypes of Organizational CulturesStructuralStructural

(The factory)(The factory)

HumanHumanResourcesResources

(The family)(The family)

PoliticalPolitical

(The jungle)(The jungle)

SymbolicSymbolic

(The temple)(The temple)

Hierarchy and rulesHierarchy and rules

At its worstAt its worstdominated by egodominated by ego

Can be coldCan be coldbureaucratic andbureaucratic andstiflingstifling

AutocraticAutocratic--LeadersLeaders

can do no wrongcan do no wrongCan be beneficial toCan be beneficial toemployees whoemployees whoappreciate structureappreciate structure

Organization existsOrganization exists

to serve humanto serve humanneedsneeds

Relationships are atRelationships are atthe corethe core -- betweenbetweenpeople and with thepeople and with theorganizationorganization

Concerned withConcerned withhow well humanhow well humanneeds are metneeds are met

What motivatesWhat motivatespeoplepeople

Can result inCan result inmanipulation ormanipulation or

inability to meetinability to meetevery needevery need

Considered mostConsidered most

desirabledesirableConflict is inevitableConflict is inevitable

Ineffective leadersIneffective leadersuse attacks oruse attacks orthreats to get theirthreats to get theirwayway

Savvy leadersSavvy leadersrecognize powerrecognize powerplays can haveplays can havedisastrous resultsdisastrous resultsand make enemiesand make enemies

Prefer to usePrefer to usecompromise andcompromise and

cooperationcooperation

Organizations honorOrganizations honor

the beliefs, values,the beliefs, values,practices andpractices andlegacies that definelegacies that definethe culturethe culture

Seldom used todaySeldom used todaybut can be helpful inbut can be helpful incelebrating the pastcelebrating the past

and creating a bond.and creating a bond.

Symbols need to beSymbols need to beused carefully toused carefully toavoid backfiringavoid backfiring


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Organizational Culture Models cont.Organizational Culture Models cont.

Every organization has characteristics ofEvery organization has characteristics ofall four models.all four models.

The key is to determine which model isThe key is to determine which model isdominant.dominant.

Each can be functional or dysfunctional.Each can be functional or dysfunctional.

Each is related to a leadership philosophyEach is related to a leadership philosophyin terms of how organizations andin terms of how organizations andindividuals relate to one another.individuals relate to one another.


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Benefits of Strong CorporateBenefits of Strong Corporate

CulturesCultures

Strong

Organizational

Culture

SocialSocial

ControlControl

ImprovesImprovesSenseSense--MakingMaking

SocialSocial

GlueGlue


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Problems with Strong CulturesProblems with Strong Cultures

1.1. Culture content might be misaligned withCulture content might be misaligned withthe organizations environment.the organizations environment.

2.2. Strong cultures may focus on mentalStrong cultures may focus on mentalmodels that could be limitingmodels that could be limiting

3.3. Strong cultures suppress dissenting valuesStrong cultures suppress dissenting valuesfrom subcultures.from subcultures.


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Adaptive Organizational CulturesAdaptive Organizational Cultures

External focusExternal focus ---- firms success dependsfirms success dependson continuous changeon continuous change

Focus on processes more than goalsFocus on processes more than goals

Strong sense of ownershipStrong sense of ownership

ProactiveProactive ----seek out opportunitiesseek out opportunities


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Leadership PhilosophiesLeadership Philosophies

Organizations are shaped by their leaders.Organizations are shaped by their leaders.

Organizational cultures begin with the philosophies heldOrganizational cultures begin with the philosophies heldby the people who run the organization.by the people who run the organization.

Leadership Philosophies include:Leadership Philosophies include: Classical ManagementPhilosophyClassical ManagementPhilosophy Task vs. Relationship PhilosophyTask vs. Relationship Philosophy

Participative ManagementPhilosophyParticipative ManagementPhilosophy

Contemporary PhilosophiesContemporary Philosophies ValuesValues--drivendriven

InformationInformation--drivendriven CustomerCustomer--drivendriven

Learning OrganizationLearning Organization


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Classical ManagementPhilosophiesClassical ManagementPhilosophies

Began in late 18Began in late 18thth century with Adam Smiths Wealth ofcentury with Adam Smiths Wealth ofa Nations, as an attempt to increase productivity in aa Nations, as an attempt to increase productivity in apin manufacturing company.pin manufacturing company.

Stated that workers needed close supervision, clearStated that workers needed close supervision, cleardirection and careful discipline.direction and careful discipline.

Assumed that:Assumed that: employees could not be trustedemployees could not be trusted

work does not come naturally so they must be forced to do it.work does not come naturally so they must be forced to do it. managers do all the thinkingmanagers do all the thinking

Widely used during the Industrial RevolutionWidely used during the Industrial Revolution


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Classical Management ModelsClassical Management ModelsScientific ManagementScientific Management

(Frederick Taylor)(Frederick Taylor)

Theory X and Theory YTheory X and Theory Y

(Douglas McGregor)(Douglas McGregor)

Four SystemsFour Systems

(Rensis Likert)(Rensis Likert)

Structured and mechanisticStructured and mechanistic

Based on time and motionBased on time and motionstudiesstudies

People were like machinesPeople were like machines

Unfair and unrealisticUnfair and unrealistic

Jobs eliminated due toJobs eliminated due toefficiencyefficiency

Greatly opposed by unionsGreatly opposed by unionsduring the Depressionduring the Depression

Theory XTheory X --Direction and controlDirection and controlthrough authoritythrough authority

Lone decisionLone decision--making by CEOmaking by CEO

Creates a climate of fear andCreates a climate of fear andmistrustmistrust

Theory YTheory Y Productivity comesProductivity comeswith fulfilling higher order needswith fulfilling higher order needs --selfself--actualization.actualization.

People need to be selfPeople need to be self--directed.directed.

Four SystemsFour Systems organizationsorganizationsoperate on 4 levels accordingoperate on 4 levels accordingto: motivation, responsibility,to: motivation, responsibility,cooperation, and trustcooperation, and trust

System 1System 1 fear, mistrust,fear, mistrust,

suspicion, misinformationsuspicion, misinformationSystem 2System 2 rewards, somerewards, somepunishment, little cooperationpunishment, little cooperation

System 3System 3 rewards, littlerewards, littlepunishment, some cooperation,punishment, some cooperation,

System 4System 4 rewards,rewards,cooperation, mutual trustcooperation, mutual trust

CommunicationsCommunications

Exclusively downward throughExclusively downward througha chain of commanda chain of command

Conflicts resolved by CEOConflicts resolved by CEO

Complainers let goComplainers let go


Theory XTheory X --Commands flowCommands flowexclusively top down throughexclusively top down throughcommand and control.command and control.

Theory YTheory Y Encourage upward,Encourage upward,downward and lateraldownward and lateralcommunications.communications.

Seeks feedback ,interaction,Seeks feedback ,interaction,openness and honesty.openness and honesty.


System 1System 1 downward, hostiledownward, hostile

System 2System 2 downward need todownward need toknow, misinformationknow, misinformation

System 3System 3 downward,downward,accurateaccurate information providedinformation provided

System 4System 4 open, honest,open, honest,accurateaccurate


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Task vs. Relationship PhilosophiesTask vs. Relationship PhilosophiesBlake, Mouton, Blake and McCanseBlake, Mouton, Blake and McCanse

CONCERN FOR PRODUCTIONCONCERN FOR PRODUCTION

Country Club Management Team Management

Thoughtful attention to the needs of people

for satisfying relationships, friendly atmosphere

Middle of the Road Management

Impoverished Management Authority Compliance

CONCE

RN

FOR

PE

OP

LE

Work accomplishment is from

committed people,interdependence through acommon stake in organizationpurpose leads to trust andrespect

Adequate organization performance ispossible through balancing the necessity toget out the work with maintaining morale ofpeople at a satisfactory level

Exertion of minimum effort to getrequired work done is appropriate

to sustain organizationmembership.

Efficiency in operations results fromarranging conditions of work in such a

way that human elements interfere toa minimum degree.


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Situational Leadership PhilosophySituational Leadership Philosophy

Hershey and BlanchardHershey and Blanchard Effective leaders vary their styles with the readiness of theEffective leaders vary their styles with the readiness of the

followers.followers.

Subordinates maturitySubordinates maturity -- The employees ability (job maturityThe employees ability (job maturity --knowledge and skills) and willingness (psychological maturityknowledge and skills) and willingness (psychological maturity --motivation and commitment) to take responsibility for directing ownmotivation and commitment) to take responsibility for directing own

behavior in accomplishing a task.behavior in accomplishing a task. Life Cycle Theory of LeadershipLife Cycle Theory of Leadership -- Identifies four leadership stylesIdentifies four leadership styles--

telling, selling, participating and delegating. In terms of the amounttelling, selling, participating and delegating. In terms of the amountof directive and supportive behavior provided.of directive and supportive behavior provided.

Low psychological and job maturityLow psychological and job maturity -- tasktask--oriented leadershiporiented leadership

increasesincreases Job and psychological maturity increasesJob and psychological maturity increases tasktask--orientedoriented

decreases, relationshipdecreases, relationship--oriented increasesoriented increases High job and psychological maturityHigh job and psychological maturity decrease in task anddecrease in task and

relationship behaviorrelationship behavior


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Participative ManagementParticipative Management

PhilosophiesPhilosophies Focuses on the extent to which decisionFocuses on the extent to which decision--

making power is vested entirely at the topmaking power is vested entirely at the top

or shared with lower levels of theor shared with lower levels of theorganization.organization.


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Participative ManagementPhilosophiesParticipative ManagementPhilosophiesJapanese PhilosophyJapanese Philosophy

Type zType z

Teamwork PhilosophyTeamwork Philosophy SelfSelf--ManagementManagementPhilosophyPhilosophy

Bottom up initiativeBottom up initiative changechangeshould come from thoseshould come from thoseclosest to the problemclosest to the problem encourages bottom upencourages bottom up

communications.communications.Top management asTop management asfacilitatorfacilitator ideas areideas areencouraged managers do notencouraged managers do nothave the all the answers.have the all the answers.

Middle management asMiddle management asimpetus for solutionsimpetus for solutions perceive problems andperceive problems and

generate solutions (RCLs)generate solutions (RCLs)horizontal and bottom uphorizontal and bottom upcommunication required.communication required.

Consensus decisionConsensus decision--makingmaking alternative solutions sought,alternative solutions sought,no one right way, consensusno one right way, consensussought, commitment tosought, commitment tochoice. Concern for employeechoice. Concern for employeewellwell--beingbeing personal andpersonal androfessional wellrofessional well--bein im t.bein im t.

Characterized by openCharacterized by opencommunications that flowscommunications that flowsup, down and lateralup, down and lateral cutscutsacross all boundaries.across all boundaries.

Asserts that the entireAsserts that the entireorganization should functionorganization should functionas teams with each levelas teams with each levelparticipating in decisionparticipating in decision--making and problemmaking and problem--solving.solving.

Shared responsibilityShared responsibility nonolone ranger.lone ranger.

More complex taskMore complex task bestbestassigned to teams.assigned to teams.

Spontaneous problemSpontaneous problem--solving is encouraged.solving is encouraged.

Conflicts resolved at lowestConflicts resolved at lowestpossible levels.possible levels.

Initial training in groupInitial training in groupdynamics, problemdynamics, problem--solvingsolvingand scope of responsibilityand scope of responsibilityand authority provided byand authority provided by

management.management.

Leadership emergesLeadership emergesinformally among members.informally among members.

Those with groupThose with groupcommunication skillscommunication skillsemerge as informal leaders.emerge as informal leaders.

Requires a great deal ofRequires a great deal ofmutual trust.mutual trust.

Middle management mayMiddle management maybe threatened.be threatened.

Takes long time toTakes long time toimplement and may beimplement and may becostly in terms of trainingcostly in terms of training

Not suitable for everyone.Not suitable for everyone.


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OrganizationOrganization--Based PhilosophicalBased PhilosophicalApproachesApproaches ValuesValues--Driven PhilosophyDriven Philosophy

ValuesValues--Driven PhilosophyDriven Philosophy based upon the works of Steven Covey argues thatbased upon the works of Steven Covey argues thateffective organizations live according to clear widelyeffective organizations live according to clear widely--supported set of values.supported set of values.Developed the 7 Habits of Highly Effective People that included: be proactive, beginDeveloped the 7 Habits of Highly Effective People that included: be proactive, beginwith the end in mind, put first things first, think win/win, seek first to understandwith the end in mind, put first things first, think win/win, seek first to understandthen be understood, synergize, sharpen the saw.then be understood, synergize, sharpen the saw.

Later he advocated using the habits on four levels:Later he advocated using the habits on four levels: OrganizationalOrganizational to align organizations and individualsto align organizations and individuals ManagerialManagerial to achieve empowerment of others.to achieve empowerment of others. InterpersonalInterpersonal to build trustto build trust PersonalPersonal to achieve trustworthiness in the eyes of othersto achieve trustworthiness in the eyes of others

Communications behaviors that assist in PrincipleCommunications behaviors that assist in Principle--Centered Leadership include:Centered Leadership include: Listening before explainingListening before explaining Involving others to produce win/win solutionsInvolving others to produce win/win solutions

Refrain from making negative or unkind statementsRefrain from making negative or unkind statements Admitting mistakesAdmitting mistakes Apologizing asking for forgivenessApologizing asking for forgiveness

This approach takes into account how and what the organization communicates.This approach takes into account how and what the organization communicates.


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InformationInformation--Driven PhilosophyDriven Philosophy

A combination of classical and valuesA combination of classical and values--driven the opendriven the open--book leadershipbook leadershipphilosophy holds that employees efforts should be guided and motivated byphilosophy holds that employees efforts should be guided and motivated byinformation.information.

Advocates use of a a balanced scorecard that measures:Advocates use of a a balanced scorecard that measures: Financial performance, customer knowledge, internal business processes, andFinancial performance, customer knowledge, internal business processes, and

learning and growing for alignment and motivation.learning and growing for alignment and motivation.

Open book managementOpen book management encourages thinking and acting like a businessencourages thinking and acting like a businesspartner. Based on the notion that employees want to know their industrypartner. Based on the notion that employees want to know their industryand will act responsibly as a result. Leaders should therefore:and will act responsibly as a result. Leaders should therefore: Make full information availableMake full information available Build business literacyBuild business literacy Empower employees to act on informationEmpower employees to act on information Create reward structuresCreate reward structures

This approach is heavily communication oriented and assumes employeesThis approach is heavily communication oriented and assumes employeeswill perform when they understand the big picture.will perform when they understand the big picture.


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CustomerCustomer--Driven PhilosophyDriven Philosophy Albrecht and Zemke in Service AmericaAlbrecht and Zemke in Service America -- A combination of valuesA combination of values--drivendriven

and informationand information--driven philosophies, whereby everything in the organizationdriven philosophies, whereby everything in the organization

leads to customer satisfaction.leads to customer satisfaction.

Driven by the notion that organizations perform, not produce thereforeDriven by the notion that organizations perform, not produce thereforesuccess is determined by each moment of truth as customers are served.success is determined by each moment of truth as customers are served.

The traditional pyramid of authority needs to be turned upside down so thatThe traditional pyramid of authority needs to be turned upside down so thatthose who serve the customers become the central focus of management.those who serve the customers become the central focus of management.

Communication practices include:Communication practices include:

Crete a customerCrete a customer--keeping vision through top down communicationskeeping vision through top down communications Saturate the company with the voice of the customerSaturate the company with the voice of the customer Empower employees to make decisions/solve problems on customer behalfEmpower employees to make decisions/solve problems on customer behalf Emphasis on measuring satisfaction at individual, team and organizational levels.Emphasis on measuring satisfaction at individual, team and organizational levels. Walk the talkWalk the talk demonstrate values and customer focus, particularly leadership.demonstrate values and customer focus, particularly leadership.

WiersemaWiersema Argues that communications and relationships should be usedArgues that communications and relationships should be usedto achieve customer intimacy which is characterized by judgment,to achieve customer intimacy which is characterized by judgment,cooperation and learning.cooperation and learning.


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Learning Organization PhilosophyLearning Organization Philosophy Peter Senge in the Fifth Discipline, combines valuesPeter Senge in the Fifth Discipline, combines values--based,based,

teamwork, and information driven approaches that asserts that inteamwork, and information driven approaches that asserts that inorder for organizations to survive they must become learningorder for organizations to survive they must become learningentities characterized by five disciplines:entities characterized by five disciplines:

Systems thinkingSystems thinking-- interconnectedness of the organizationinterconnectedness of the organization

Personal masteryPersonal mastery individual mastery achieved through selfindividual mastery achieved through self--actualization.actualization. Mental modelsMental models assumptions of the world that influence decisionassumptions of the world that influence decision--

makingmaking Build shared visionBuild shared vision a collective vision of the futurea collective vision of the future Team learningTeam learning Using dialogue to create synergistic teams.Using dialogue to create synergistic teams.

Gifford and PinchotGifford and Pinchot adds the dimension that organizations mustadds the dimension that organizations mustengage the intelligence, judgment, etc. of everyone in theengage the intelligence, judgment, etc. of everyone in theorganization to be responsive to customers.organization to be responsive to customers.


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Seven Leadership CompetenciesSeven Leadership Competencies

Emotional IntelligenceEmotional Intelligence

IntegrityIntegrity

DriveDrive

Ability to perceive,Ability to perceive,express, regulateexpress, regulateemotions in self andemotions in self andothersothers

Refers to the truthfulnessRefers to the truthfulnessand ability to translateand ability to translatewords into deedswords into deeds

Inner motivation toInner motivation topursue goals.pursue goals.


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Seven CompetenciesSeven Competencies

Leadership motivationLeadership motivation

SelfSelf--confidenceconfidence

IntelligenceIntelligence

Knowledge of theKnowledge of thebusinessbusiness

Socialized power used toSocialized power used toaccomplish goals.accomplish goals.

Belief in ones own skillsBelief in ones own skillsand abilities.and abilities.

Cognitive ability toCognitive ability toprocess large amounts ofprocess large amounts ofinformation.information.

Understanding of theUnderstanding of thecompanys environmentcompanys environmentto make intuitiveto make intuitivedecisions.decisions.

chapter 3 - baird

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