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Organizational Behavior 8th edition

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www.downloadslide.com According to Zappos CEO Tony Hsieh, a strong and aligned organizational culture is a key factor in the online shoe and clothing retailer’s success. “Our number one priority is company culture,” says Hsieh. “Our whole belief is that if we get the culture right then most of the other stuff like delivering great customer service or building a long-term enduring brand will just happen naturally on its own.” However, Hsieh warns that every business needs to develop a culture that best suits its external environment. “We’re not out there trying to say that other companies should try to adopt the Zappos values and culture,” Hsieh advises. “All we’re trying to say is that they should have their own values and really commit to them in order to build their own strong culture that’s right for them.” 40 Source: TopRank Marketing/Flickr Culture Strength Is Not the Level of a Cult A second contingency is the degree of culture strength. Various experts suggest that companies with very strong cultures (i.e., corporate “cults”) may be less effective than companies with moderately strong cultures. 41 One reason why corporate cults may undermine organizational effectiveness is that they lock people into mental models, which can blind them to new opportunities and unique problems. The effect of these very strong cultures is that people overlook or incorrectly define subtle misalignments between the organization’s activities and the changing environment. The other reason why very strong cultures may be dysfunctional is that they suppress dissenting subcultures. The challenge for organizational leaders is to maintain not only a strong culture but one that allows subcultural diversity. Subcultures encourage taskoriented conflict, which improves creative thinking and offers some level of ethical vigilance over the dominant culture. In the long run, a subculture’s nascent values could become important dominant values as the environment changes. Corporate cults suppress subcultures, thereby undermining these benefits. adaptive culture an organizational culture in which employees are receptive to change, including the ongoing alignment of the organization to its environment and continuous improvement of internal processes Culture Is an Adaptive Culture A third condition influencing the effect of cultural strength on organizational effectiveness is whether the culture content includes an adaptive culture. 42 An adaptive culture embraces change, creativity, open-mindedness, growth, and learning. Organizational leaders across many industries increasingly view an adaptive culture as an important ingredient for the organization’s long-term success. “At the end of the day, you have to create a culture that not only accepts change but seeks out how to change,” says former GM CEO Dan Akerson. “It’s critically important that we inculcate that into our culture.” 43 What does an adaptive culture look like? It is one in which employees recognize that the organization’s survival and success depends on their ability to discover emerging changes in the external environment and to adapt their own behavior to those changes. Thus, employees in adaptive cultures see things from an open systems perspective and take responsibility for the organization’s performance and alignment with the external environment. In an adaptive culture, receptivity to change extends to internal processes and roles. Employees believe that satisfying stakeholder needs requires continuous improvement of internal work processes. They also recognize the importance of remaining flexible in their own work roles. The phrase “That’s not my job” is found in nonadaptive cultures. Finally, an adaptive culture has a strong learning orientation because being receptive to change necessarily means that the company also supports action-oriented discovery. With a learning orientation, employees welcome new learning opportunities, actively experiment with new ideas and practices, view reasonable mistakes as a natural part of the learning process, and continuously question past practices (see Chapter 7). 44 397

www.downloadslide.com 398 Part Four Organizational Processes debating point IS CORPORATE CULTURE AN OVERUSED PHRASE? Corporate culture is probably one of the most frequently uttered phrases in organizations these days. That’s quite an accomplishment for two words that were rarely paired together prior to 1982. 45 Executives say they have crafted the company’s culture to attract top talent and better serve clients. Job applicants have made organizational culture one of the top factors in their decision whether to join the company. Journalists routinely blame corporate culture for business failures, deviant activities, and quirky employee conduct. This chapter offers plenty of ammunition to defend the argument that organizational culture explains employee decisions and behavior. A strong culture is a control system that directs employee decisions and behavior. It is, after all, the “way we do things around here.” The underlying assumptions of a company’s culture further guide employee behavior without conscious awareness. A strong culture also serves as the company’s “social glue,” which strengthens cohesion among employees. In other words, employees in strong cultures have similar beliefs and values which, in turn, increases their motivation to follow the corporate herd. Organizational culture can be a useful concept to explain workplace activities, but some OB experts suggest that the phrase is overused. To begin with, corporate culture is usually presented as a singular thing within the company—one company with one culture. This presumption of a homogeneous culture—in which every employee understands and embraces the same few dominant values—just doesn’t exist. Every organization has a fragmented culture to varying degrees. Furthermore, many employees engage in façades of conformity. They pretend to live the company’s values but don’t actually do so because they don’t believe in them. 46 Fragmentation and façades suggest that culture is not an integrated force field that manipulates people like mindless robots. Instead, employees ultimately make decisions based on a variety of influences, not only the organization’s values and assumptions. Another argument that corporate culture is overused to explain the workplace is that values don’t drive behavior as often as many people believe. Instead, employees turn to their values to guide behavior only when they are reminded of their values or when the situation produces fairly obvious conflicting or questionable decisions. 47 Most of the time, frontline staff perform their jobs without much thought to their values. Their decisions are usually technical rather than values-based matters. As such, corporate culture has a fairly peripheral role in daily routine work activities. A third problem is that organizational culture is a blunt instrument for explaining workplace behavior and for recommending how to change those behaviors. “Fix the culture” is almost meaningless because the problems prompting this advice could be due to any number of artifacts. Furthermore, some problems attributed to a poor corporate culture may be due to more mundane and precise dysfunctions— unintended consequences of poorly designed rewards, ineffective leadership, misaligned corporate strategy, biased information systems, and a host of other conditions. Rather than blame the company’s culture, we should pay more attention to specific systems, structures, behaviors, and attitudes that explain what went wrong. Furthermore, as one paper recently noted, organizational culture is often the outcome of these specific artifacts, not the cause of the problems those artifacts create. 48 ORGANIZATIONAL CULTURE AND BUSINESS ETHICS An organization’s culture influences the ethical conduct of its employees. This makes sense because good behavior is driven by ethical values, and ethical values become embedded in an organization’s dominant culture. For example, AIA Group, Hong Kong’s largest life insurance company (by number of policies), has a strong culture focused on “doing the right thing, in the right way, with the right people, and the results will come.” This means that employees are expected to think through the ramifications of their actions (right thing) and ensure they always work with integrity and teamwork (right way). 49 The opposite is equally true. There are numerous instances where an organization’s culture has caused unethical conduct. For example, critics claim that News Corp’s news tabloids have had a culture that rewards aggressive, partisan, and sensationalistic tactics. This culture may have uncovered news, but it allegedly also pushed some journalists and executives over the ethical line, including illegally hacking into the phones of celebrities, crime victims, and politicians. A British parliamentary committee (among others) concluded that News Corp’s wrongdoing was caused by a wayward culture that “permeated from the top throughout the organization.” As one journalist concluded: “Phone hacking is done by employees within the corporate culture of ‘whatever it takes.’” 50 The point here is that culture and ethics go hand-in-hand. To create a more ethical organization, leaders need to work on the enacted culture that steers employee behavior.

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