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Managing Managing ChangeChange

Lecture 2Lecture 2Organizational Culture, Organizational Culture, Structure and ChangeStructure and Change

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LECTURE OUTLINELECTURE OUTLINE

2.0 Introduction2.0 Introduction

2.1 The culture2.1 The culture

2.2 National culture2.2 National culture

2.3 From breadth to convergence2.3 From breadth to convergence

2.4 Culture and change2.4 Culture and change

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2.0 INTRODUCTION2.0 INTRODUCTION

The invisible hand of culture – both in The invisible hand of culture – both in terms of national and global can affect terms of national and global can affect the ways in which organizations and the ways in which organizations and people react to changepeople react to change

This in turn influences the ways in This in turn influences the ways in which change initiatives are which change initiatives are implementedimplemented

No matter whether the change is small No matter whether the change is small or big, the Manager must anticipate or big, the Manager must anticipate resistance to changesresistance to changes

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2.1 THE CULTURE2.1 THE CULTURE

Is the glue that hold people Is the glue that hold people together in national or work together in national or work groups.groups.

It is composed of values, beliefs It is composed of values, beliefs and underlying assumptions that and underlying assumptions that are deeply held.are deeply held.

Based on an intangible factor that Based on an intangible factor that is usually firmly rooted and hard to is usually firmly rooted and hard to change.change.

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Organizational CultureOrganizational Culture

The pattern of basic assumptions; invented, The pattern of basic assumptions; invented, discovered or developed, to cope with discovered or developed, to cope with problems of adaptation and integration so as problems of adaptation and integration so as for the new members to perceive, think and for the new members to perceive, think and feel in relation to these problems (Schein).feel in relation to these problems (Schein).

The set of key values, beliefs, The set of key values, beliefs, understandings, and norms that members of understandings, and norms that members of an organization share (Daft, 2008).an organization share (Daft, 2008).

A system of shared meanings and common A system of shared meanings and common beliefs held by organizational members that beliefs held by organizational members that determines, in a large degree, how they act determines, in a large degree, how they act towards each other (Robbins, 2007.towards each other (Robbins, 2007.

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Visible ArtifactsVisible Artifacts – that is the – that is the constructed environment which is constructed environment which is exemplified by technology, exemplified by technology, architecture, dress codearchitecture, dress code

Values that govern behaviourValues that govern behaviour – – identified by what people say – the real identified by what people say – the real reasons may be concealed or reasons may be concealed or unconsciousunconscious

Underlying assumptions Underlying assumptions – determine – determine how group members perceive, think how group members perceive, think and feel - really helps to understand and feel - really helps to understand culture culture

Three Levels of Culture

Three Levels of CultureThree Levels of Culture

• Unconscious, taken-for-granted perceptions or beliefs

• Mental models of ideals

Shared assumptionsShared assumptions

• Conscious beliefs• Evaluate what is good or bad, right or

wrong

Shared valuesShared values

ArtifactsArtifactsArtifactsArtifacts

• Stories/legends• Rituals/ceremonies• Organizational language• Physical structures/décor

• Stories/legends• Rituals/ceremonies• Organizational language• Physical structures/décor

Visible

InvisibleInvisible(below the surface)(below the surface)

Source: Daft, 2008

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Factors that can influence Factors that can influence cultureculture

The beliefs and values of the The beliefs and values of the organization's founder – vision and organization's founder – vision and missionmission

The societal norms of the country The societal norms of the country in which the organization operates in which the organization operates

Past practices of the organization - Past practices of the organization - The way things have been doneThe way things have been done

The behavior of top management The behavior of top management

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Mintzberg’s (1989) Mintzberg’s (1989) Organizational Structure Organizational Structure

More readings: More readings: http://www.12manage.com/methods_mintzberg_configurations.hthttp://www.12manage.com/methods_mintzberg_configurations.ht

mlml http://www.provenmodels.com/22/five-configurations/mintzberghttp://www.provenmodels.com/22/five-configurations/mintzberg

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Charles Handy’s (1993) 4 Charles Handy’s (1993) 4 Main Types of Main Types of OrganizationalOrganizational

POWER CULTUREPOWER CULTURE – Influenced by one – Influenced by one person – effectiveness depends on the person – effectiveness depends on the charisma and leadership qualities of the charisma and leadership qualities of the individualindividual

ROLE CULTUREROLE CULTURE – Depended on functions, – Depended on functions, authority and bureaucracyauthority and bureaucracy

TASK CULTURETASK CULTURE – Dependent on teams of – Dependent on teams of experts working together – Success depends experts working together – Success depends on getting the best to complete a taskon getting the best to complete a task

PERSON CULTUREPERSON CULTURE - Groups or individuals - Groups or individuals who come together to design a culture – who come together to design a culture – opportunity to develop personal aims and opportunity to develop personal aims and objectivesobjectives

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Fons Trompenaar’s Fons Trompenaar’s (1994) description(1994) description

The The family culturefamily culture which is which is personal, paternal & hierarchicalpersonal, paternal & hierarchical

The The Eiffel Tower cultureEiffel Tower culture – – bureaucraticbureaucratic

The The guided missile cultureguided missile culture – which – which is task orientedis task oriented

The The incubator cultureincubator culture – which – which nurtures individual creativitynurtures individual creativity

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2.2 NATIONAL CULTURE2.2 NATIONAL CULTURE

National culture can result from National culture can result from one nation attributing one nation attributing characteristics to another, which characteristics to another, which can result in stereotyping and can result in stereotyping and prejudice.prejudice.

The members of the organization The members of the organization bring their own individual bring their own individual experiences, beliefs and values.experiences, beliefs and values.

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Hofstede’s Five Hofstede’s Five Dimensions of National Dimensions of National

CultureCultureIndividualism-collectivism. Individualism-collectivism. Power distance.Power distance.Uncertainty avoidance.Uncertainty avoidance.Masculinity-femininity.Masculinity-femininity.Long-term/short-term orientationLong-term/short-term orientation

(Source: Schemerhorn et al., 2005)(Source: Schemerhorn et al., 2005)

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1. Individualism-1. Individualism-collectivismcollectivism

The cultural tendency to emphasize The cultural tendency to emphasize individual or group interests.individual or group interests.

Preferences for working individually Preferences for working individually or in groups.or in groups.

Example of an individualistic culture Example of an individualistic culture — United States.— United States.

Example of a collectivist culture Example of a collectivist culture — — MexicoMexico

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2. Power distance2. Power distance

The willingness of a culture to accept The willingness of a culture to accept status and power differences among status and power differences among members.members.

Respect for hierarchy and rank in Respect for hierarchy and rank in organizations.organizations.

Example of a high power distance Example of a high power distance culture culture — Indonesia.— Indonesia.

Example of a low power distance Example of a low power distance culture culture — Sweden.— Sweden.

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3. Uncertainty avoidance3. Uncertainty avoidance

The cultural tendency toward The cultural tendency toward discomfort with risk and ambiguity.discomfort with risk and ambiguity.

Preference for structured versus Preference for structured versus unstructured organizational situations.unstructured organizational situations.

Example of a high uncertainty Example of a high uncertainty avoidance culture avoidance culture — France.— France.

Example of a low uncertainty Example of a low uncertainty avoidance culture avoidance culture — Hong Kong.— Hong Kong.

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4. Masculinity-femininity4. Masculinity-femininity

The tendency of a culture to value The tendency of a culture to value stereotypical masculine or feminine traits.stereotypical masculine or feminine traits.

Emphasizes competition/assertiveness Emphasizes competition/assertiveness versus interpersonal versus interpersonal sensitivity/relationships.sensitivity/relationships.

Example of a masculine culture Example of a masculine culture — Japan.— Japan.Example of a feminine culture Example of a feminine culture — Thailand— Thailand

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5. Long-term/short-term 5. Long-term/short-term orientationorientation

The tendency of a culture to The tendency of a culture to emphasize future-oriented values emphasize future-oriented values versus present-oriented values.versus present-oriented values.

Adoption of long-term or short-term Adoption of long-term or short-term performance horizons.performance horizons.

Example of a long-term orientation Example of a long-term orientation culture culture — South Korea.— South Korea.

Example of a short-term orientation Example of a short-term orientation culture culture — United States.— United States.

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2.3 FROM BREADTH TO 2.3 FROM BREADTH TO CONVERGENCECONVERGENCE

Central to the Central to the Convergence theoryConvergence theory is the logic is the logic of industrialization – Changes in technology, of industrialization – Changes in technology, revolutionalised large scale production and revolutionalised large scale production and product complex divisions of labourproduct complex divisions of labour

Divergence theoristsDivergence theorists take the opposite view - take the opposite view - people will respond differently to the forces, people will respond differently to the forces, such as technology that drives changes - such as technology that drives changes - Individuals influenced by national cultureIndividuals influenced by national culture

Refer to the case study on page 69 and 70Refer to the case study on page 69 and 70

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2.4 CULTURE AND 2.4 CULTURE AND CHANGECHANGE

Schein’s (1984) 3 Distinct Stages Schein’s (1984) 3 Distinct Stages of an Organization's Lifeof an Organization's Life

The The early stagesearly stages of formation – provides a of formation – provides a source of identity and strengthsource of identity and strength

The The middle stagesmiddle stages – responses to – responses to challenges from the external and internal challenges from the external and internal environment – at this stage very complex environment – at this stage very complex & challenging blends would take place& challenging blends would take place

The The matured stagematured stage – suffer from – suffer from complacency and outdated strategiescomplacency and outdated strategies

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PerformancePerformance – sticking to rules or seeking – sticking to rules or seeking resultsresults

ObjectivesObjectives – changes would be smoother – changes would be smoother where there is consultation on objectiveswhere there is consultation on objectives

PlanningPlanning – successful planning involves – successful planning involves questioning of objectives and not just questioning of objectives and not just identifying steps needed to achieveidentifying steps needed to achieve

ConsultationConsultation – good ideas could emerge from – good ideas could emerge from this approachthis approach

ProceduresProcedures – operational procedures are good – operational procedures are good guidelines forguidelines for

Aspects of Organizational Aspects of Organizational Operation that Influences Operation that Influences

ChangesChanges

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CommunicationCommunication – good internal – good internal communication facilitates those involved in communication facilitates those involved in being informed of goals identifiedbeing informed of goals identified

Decision-making Decision-making – Centralized or – Centralized or decentralized depending on the decentralized depending on the organizational structure and set-uporganizational structure and set-up

Loyalty expectationsLoyalty expectations – expecting loyalty to – expecting loyalty to objectives usually means better adaptability objectives usually means better adaptability to changeto change

Risk-takingRisk-taking – calculated risks minimizes – calculated risks minimizes undue losesundue loses

Aspects of Organizational Aspects of Organizational Operation that Influences Operation that Influences

ChangesChanges

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ReferencesReferences

• Daft, R.L. (2008). Daft, R.L. (2008). The New Era of The New Era of ManagementManagement, 2nd Edition. Thomson , 2nd Edition. Thomson South-Western, Ohio. South-Western, Ohio.

• McShane and Glinow. (2008). McShane and Glinow. (2008). Organizational BehaviorOrganizational Behavior, 4th Edition. , 4th Edition. McGraw-Hill.McGraw-Hill.

• Robbins, S.P. and Coulter, M. (2007). Robbins, S.P. and Coulter, M. (2007). ManagementManagement, 9th Edition. Prentice-Hall, , 9th Edition. Prentice-Hall, USA.USA.

• Schermerhorn, J.R., Hunt, J.G. and Schermerhorn, J.R., Hunt, J.G. and Osborn, R.N. (2005) Osborn, R.N. (2005) Organizational Organizational BehaviorBehavior 9th Edition, Wiley 9th Edition, Wiley