Management of organizational culture central to contemporary management

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The World is moving through organizations. As because man can do very few things individually they form organization to achieve certain goals. Millions of organizations are formed around the globe for attaining different objectives both in public and private levels but managing those are not so easy. Organizations are facing many obscurities to manage their operations. There are no such two organizations that are exactly same. They can be differing in many ways like: Objective of the organization, kind of operations, process of running the organization and mostly the organizational culture. An organization is a group of people who work together to pursue a specific goal, more specifically organization is the act of organizing a business or an activity related to a business. A culture is a way of life of a group of individuals; the behaviors, beliefs, assumptions, norms, values and symbols that they accept and that are passed along by one generation to the next. "Culture is the fabric of meaning in terms of which human beings interpret their experience and guide their action and that culture is an ordered system of meaning and of symbols in terms of which social interaction takes place" (Clifford Geertz, 1973). So we can tell that organizational culture is the way of operation of an individual organization where the member of it shares a similar values and practices. Generally Organizational culture means the personality of an organization. Some call it as"social glue" that ties company's members together. In a broader sense Organizational culture is "A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way you perceive, think, and feel in relation to those problems." (Edgar H Schein, 1997). In the contemporary business organizations, main goal is to increase their equity by increasing profitability. World market is now a red ocean where the giant sharks are fighting for prey. In the circumstances distinct organizational culture is the attribute to gaining competitive advantage. Corporate culture works as an asset that could be managed to improve business performance. Though from the early 1980s, academic and applied exploration of organizational culture has steadily increased. But it has been stated from the 1930's when the organizational behavior and other management science began investing organizations in terms of culture. "The final phase of the famous Hawthorne studies at the Western Electric Company marked the first systematic attempt to use a concept of culture to understand the work environment". (Defining "Culture" and "Organizational Culture": From Anthropology to the Office, Bruce M. Tharp). After that scholars had almost stuck with sociological and psychological aspects, but in 1970's when industrial competition was high and Japanese firms were doing well in USA, every one was curious about Japanese management practice cause of their success. Then it was found that their different corporate values, attitudes, and behaviors were keys to their superior performance. In the later time many scholars has contributed to the development of the concept of organizational culture now we have. Among them Ouchi, Pascale and Athos, Deal and Kennedy contributed most. In the recent time Edgar Schein is one of the most renowned scholars in this field. Managing organizational culture is the one of the main focus of recent management theories and practices.

Literature Review:

Organizational culture has been defined in many different ways in the literature, but most definitions have tended to focus on shared values, beliefs, behavioral norms and the artifacts that are present in organizations (Andrew Klein, Ph.D., 2008). "An organizational culture may be generally described as a set of norms, beliefs, principles and ways of behaving that together give each organization a distinctive character" (Brown 1995). 'Organizational' culture is sometimes used interchangeably with 'corporate culture' which can be describe as "The term used for a culture devised by management and transmitted, marketed, sold or imposed on the rest of the organization; with both internal and external images, yet also including action and belief - the rites, rituals, stories, and values which are offered to organizational members as part of the seductive process of achieving membership and gaining commitment". (Linstead & Grafton Small, 1992, p. 333),

In particular, "culture comprising three levels:

(1) Behaviors and artifacts: this is the most manifest level of culture, consisting of the constructed physical and social environment of an organization, e.g. physical space, mottos, artistic productions and overt behaviors of members.

(2) Values: being less visible than are behaviors and artifacts, the constituents of this level of culture provide the underlying meanings and interrelations by which the patterns of behaviors and artifacts may be deciphered.

(3) Basic assumptions: these represent an unconscious level of culture, at which the underlying values have, over a period of time, been transformed and are taken for granted as an organizationally acceptable way of perceiving the world. By this definition, basic assumptions are also the most difficult to relearn and change". (Schein 1985)

Organizational culture is linked with organizational performance. "The economic success of an organization may not be rooted in its culture, but rather that the culture may serve to foster the commitment necessary for a group of people to overcome adversity successfully" (Bernard Lim, 1995). Peters and Waterman (1982) and Deal and Kennedy (1982), claimed that a "strong" culture as a prerequisite to successful organizational performance. Organizational culture is also have an effect on Organizational knowledge management activities," knowledge shared across people to people continues to move from the posting of knowledge activities, such as employee manuals and other explicit knowledge, to greater sharing of tacit knowledge, an entrepreneurial culture will become increasingly important. It is this developing of knowledge that will yield organizations more competitive advantage from knowledge activities" (Ming-Fong Lai and Gwo-Guang Lee, 2007). From that we can think that organizational performance and organizational knowledge management activities are interlinked. "Some firms may obtain sustained superior financial performance from their organizational cultures; firms without such cultures cannot expect to engage in managerial activities which will develop cultures that, in turn, will generate such performance. Thus, the normative implications of studies on organizational cultures are limited to describing how firms enjoying sustained superior financial performance can maintain their success, and how less successful firms can obtain average, or normal, performance. Studies of cultures cannot be used to describe how less successful firms, by modifying their cultures, can come to enjoy sustained superior performance" (Jay B. Barney). If a firm's culture, in order to be the source of sustained competitive advantages, must be valuable, rare, and imperfectly imitable, then the possibility that organizational cultures with these characteristics exist must be evaluated. Previous research on organizational cultures suggests that at least some cultures of some firms have these characteristics, and thus can be a source of sustained competitive advantage. This re- search also suggests that not all firms have cultures with these three attributes (Martin, Feldman, Hatch, & Sitkin, 1983; Tichy, 1983). Strategic management as a field of general management is concerned with formulating and implementing strategies, goals, objectives, policies and programs designed to achieve competitive success. From the perspective of strategic management, "a firm's success depends on getting everyone from the top of the organization to the bottom performing activities that make the business successful. Success also depends on integrating the type of strategy that was selected by executive management with the members who must execute it, and assuring that those members behave in ways that are consistent with the strategy in their daily work lives"(Schuler, 1992).

Barney (1991) argues that the best approach for studying competitive advantage is to address a firm's strengths and weaknesses. This "resource-based view" is in contrast to the traditional focus on a firm's opportunities and threats (i.e., an environmental view). Barney suggests that resources can offer an organization a competitive advantage if they are helpful in confronting environmental threats, are rare in the competitive marketplace, and cannot be perfectly imitated or substituted for by competitors. This view is consistent with the universalistic perspective on organizational culture in that it proposes that a healthy culture can represent a critical resource. This approach also extends to other human resource management practices and activities that a firm may utilize. (Andrew Klein, 2008).

Theories regarding leadership, organizational culture, and organizational socialization have developed largely independently. Leadership theories have been around for a very long time, but, as Block (2003) recently pointed out: Despite numerous references to a relationship between leadership and organizational culture in the academic and popular literature, little systematic research has been conducted to examine the specific nature of this relationship (Block, 2003, p. 318).

Many researchers have proposed a variety of dimensions and attributes of organizational culture. Among them, Hofstede has been very influential in studies of organizational culture. Drawing on a large sample of 116,000 employees of IBM in 72 countries, Hofstede identified four dimensions of culture. These five dimensions used to differentiate between cultures are: power distance, uncertainty avoidance, masculinity/femininity, individualism/collectivism and Long-Term Orientation (Ela Oney-Yazıcı, Heyecan Giritli, Gulfer Topcu-Oraz and Emrah Acar, 2007). Beyond these, Hofstede (1997) also identified the process/results oriented, employee/job oriented, parochial/professional, open/closed system, loose/tight control and normative/pragmatic dimensions of culture. These dimensions have been commonly adapted and applied in studies of organizational culture (Sødergaard, 1996).

Organizational culture appeared to have some influence on attitudes toward organizational change (Ahmed, 1998; Lorenzo, 1998; Silvester and Anderson, 1999; Pool, 2000). According to Ahmed (1998), innovation is the engine of change and the possession of positive cultural characteristics provides the organization with necessary ingredients to innovate. Culture could enhance or inhibit the tendency to innovate. Pool (2000), however, "suggested that organizational culture allowed an organization to address ever-changing problems of adaptation to the external environment and the internal integration of organization resources, personnel and policies to support external adaptation. Therefore, it is expected that certain types of culture might facilitate the change process while other types of culture might not. One major issue confronting organizations is to determine which type of organizational culture favors organizational change" (Md Zabid Abdul Rashid, 2003).


Since the beginning management theories has traveled a long way started form the industrial revolution in the late 19th century. Different era of management is name differently depending on the focus of the scholars. At the beginning it was scientific management theory and for the preceding period it was named administrative management theory, Behavioral management theory, and Management science theory. From the 1950 to now on it is the era of Organizational environment theory which in the recent time is known as contemporary management theory. In the recent days most theory are focused on organizational environment or organizational culture. "Organization culture is the collection of shared (implied or stated) beliefs, values, rituals, stories, myths, and specialized language that foster a feeling of community among organizations member" (Kreitner, 2004). For example: McDonald's is all about corporate culture. From its Hamburger University (where managers and assistant managers are trained) to its vision statement of Quality, Service, Convenience, and Value (QSCV), McDonald's corporate culture is a shared value system that forms the basis of all company decisions. Organizational culture has many functions which are for the betterment of an organization they might be: Providing an external identity, creating a sense of commitment, acting as a source of high reliability, Defining an interpretive scheme and Acts as a social control mechanism. It also has some dysfunction like: Can create barriers to change Can create conflict within the organization and Subcultures can change at different rates than other units. The first approach towards organization culture was the Hawthorn studies in 1924 in a western Electrical plant near Chicago as a study of the relationship between light intensity and productivity. After the end of the study in 1932 it was researchers headed by Elton Mayo found that productivity was much less affected by the change in work conditions than by the attitudes of the workers themselves. Specially, relationships between members of work groups and between workers and their supervisors were found to be more significant. The way of behaving and relationships with each other within the organization is one of the major attribute of the organizational culture to give it a distinct entity. In 1981 Dr. William Ouchi suggested theory Z, which was focused on increasing employee loyalty to the company by providing a job for life with a strong focus on the well-being of the employee, both on and off the job. According to Ouchi, Theory Z management tends to promote stable employment, high productivity, and high employee morale and satisfaction. In the recent most of the managers are Theory Z managers.

In Robert House's path goal theory (1971 revised in 1996) he tells that a leader's behavior is contingent to the satisfaction, motivation and performance of his subordinates. The revised version also argues that the leader engages in behaviors that complement subordinate's abilities and compensate for deficiencies.

According to Burns (1978), transforming leadership is a process in which "leaders and followers help each other to advance to a higher level of morale and motivation" Bass in 1985 extended the theory to explain how transformational leadership could be measured. This theory is called transactional theory which inquires the interactions between leaders and followers. All the theories discussed above are some who related to the subject matter of the organizational culture. Organizational culture is also has effects on its employees job satisfaction. If the employees values belief, rituals and pre learned behavior is different then the employee will be dissatisfied and may leave the company. This kinds of consequences may caused by only a misunderstanding. To overcome from this situation an orientation programme as the organizational socialization process may help both the company and the organization to understand each other.

There are also subcultures within a culture organizations subcultures are the subsets of an organization's members who interacts regularly with one another identify themselves as a distinct group within the organization, share a set of problems commonly defined to be problems of all, and routinely take action on the basis of collective understandings unique to the group.

John Delorean's divisional head at General Motors. Created a subculture counter to the corporate GM culture based in the core values of loyalty, hierarchy, and conformity. Executives were expected to show deferential respect for authority and accept deferential treatment from subordinates; openly express loyalty to the corporation; and to be conservative in their choices of wardrobe and office decoration. Some call organizational culture the social glue that binds organizational members together. Without an appreciation for the cultural aspect, an organization is just a meaningless collection of charts tasks and people. MindSpring Enterprise a major Internet service provider in Atlanta, USA has nine core values and beliefs that govern how it operates. The principles are posted on the office walls and back of the cards. MindSpring even recite them before their weekly al hand meeting.


Organizational culture and its perceived role in organizational success are contested, resting on perceptions of culture either as a historically-based, change-resistant, deep social system which underpins all organizational strategy and action, or as just one aspect of the total organizational system, manipulable though surface structures such as rewards. Corporate culture can be looked at as a system. Inputs include feedback from, e.g., society, professions, laws, stories, heroes, values on competition or service, etc. The process is based on our assumptions, values and norms, e.g., our values on money, time, facilities, space and people. Outputs or effects of our culture are, e.g., organizational behaviors, technologies, strategies, image, products, services, appearance, etc. that's why we can. A firm's culture can be a source of sustainable competitive advantage if that culture is valuable, rare, and imperfectly imitable. The sustained superior performance of firms like IBM, Hewlett- Packard, Proctor and Gamble, and McDonald's may be, at least partly, a reflection of their organizational cultures. Organizational change efforts are rumored to fail the vast majority of the time. Usually, this failure is credited to lack of understanding about the strong role of culture and the role it plays in organizations. That's one of the reasons that many strategic planners now place as much emphasis on identifying strategic values according to their organizational culture. Considering all the aspects of environmental management practices and theories of recent times it can be derive that the management of organizational culture is central to most of the contemporary management ideas and practice.