The concepts of organisational culture

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"If you're good at anticipating the human mind, it leaves nothing to chance" was what Jigsaw, the main character of a famous horror movie series - Saw, said in Saw V. In the series, Jigsaw is the creator of many deadly traps that plays as justice tools to those who need it. He is considered as a serial murderer and is pursued by others; however he is always better than others at understanding their behaviour, ways of thinking and his ability then finally, majority of what he predicts comes true and he always wins no matter how his opponents choose. That way of sample can also be apply in a business context with organizations. Organization need to understand the way their system function as well as their opponent's to be able to survive in the business context. The habits of thinking and doing business are part of what we often call organizational culture. Schein (2010) also reminded that in the managerial literature, there was often implication that having a culture was necessary for effective performance, that the stronger the culture, the more effective the organization. As for Schein, an organizational culture proved itself in the principal ideologies and established patterns of behaviour. Therefore, culture consists of the shared beliefs, the ideologies, and the norms that influence organizational action-taking (Pfeffer, 1981).

Organizational culture


The concept of culture is often associated with interesting, distant peoples and places, with traditions, rites, foreign languages and practices (Gregory, 1983). Since the early of 1970s the concept of culture in organization context has been mentioned and built up till recently. There had been numerous of arguments over what exactly culture was due to the fact that the most interesting aspect of culture was that it pointed us to facts below the surface which had strong impacts but hard to see and recognized (Schein, 2010). Schein also noted that in order to define culture, we must go below the behavioural level because behavioural regularities could be caused by forces other than culture. After a long time conflict, majority agreed that cultures are "expressive symbols, codes, value and beliefs, information and cognitive schemata, and whatever methods are used to investigate the phenomenon" (Detert et al., 2000).

The organizational cuture

(Source: What is corporate culture, 2010)

The concept of culture is the combination of many sub-concepts and is conducted as below by Schein (2010):

Observed behavioural regularities when people interact: it could be the language they use, the customs and traditions that develop, the rituals they employ in a wide variety of situations, etc.

Group norms: the implicit standards and values that evolve in working groups

Espoused values: the articulated publicly announced principles and values that the group claims to be trying to achieve, such as "product quality", "customer satisfaction", "working attitude

Formal philosophy: the broad policies and ideological principles that guide a group's actions toward stockholders, employees, customers, and other stakeholders

Rules of the game: the implicit, unwritten rules for getting along in the organization, "the ropes" that a newcomer must learn to become an accepted member, "the way we do things around here"

Climate: the feeling that is conveyed in a group by the physical layout and the way in which members of the organization interact with each other, with customers, or with other outsiders

Embedded skills: the special competencies displayed by group members in accomplishing certain tasks, the ability to make certain things that get passed on from generation to generation without necessarily being articulated in writing

Habits of thinking, mental models, and/or linguistic paradigms: the shared cognitive frames that guide the perceptions, thought, and language used by the members of a group and are taught to new members in the early socialization process

Shared meanings: the emergent understandings that are create by group members as they interact with each other

"Root metaphors" or integrating symbols: the ways that groups evolve to characterize themselves, which may or may not be appreciated

Organizational culture models

There are many models that can be use to evaluate organizational culture but this paper would only mention two main models.

The competing values model

(Sorce: Dellana and Hauser, 2000)

The competing values model is a meta-theory originally developed to explain differences in the values underlying various organizational effectiveness models (Quinn and Rohrbaugh, 1981). It allows the measurement of the structural and strategic components of organizations, and also allows one to categorize organizations into finite, definitive sets with specific traits and allows comparison across different organizations (Quinn and Kimberly, 1984). However, there is a caution about this model that even though the model is divided into quarterly with distinct characteristics, no actual organization ia likely to reflect only one value system. One would expect to find combinations of values in a given organization with some being more dominant than others (Quinn and Kimberly, 1984).

Schein's three levels of culture model

(Source: Schein, 1985)

According to Schein, an organizational culture consists of three main levels:

Artefacts or surface manifestations: this is the first level of organizational culture and is implied by the visible things.

Organizational values : second level of organizational culture which are moral, societal or religious precepts possessing personal or organizational worth and meaning to senior management

Basic underlying assumptions: the final level of organizational culture which refer to unconscious thoughts, perceptions of each individuals within organization and is considered as real culture.

Impact of organizational culture on management style

Schein (2010) convinced us that whether or not a culture was good or bad, functionally effective or not, depends not only on the culture alone but on the relationship of the culture to the environment in which it exists. Organizational culture may be essential to an organization's performance but it is also difficult to understand and change.

Schein (2010) argued that leaders as entrepreneurs were the main architects of culture and that after cultures were formed, they influenced what kind of leadership was possible. Culture and leadership are two sides of the same coin. Leaders are the first ones that start create culture in the process of creating organization. After cultures are built, they determine the criteria for leadership and therefore determine who will be a leader. If elements of culture become dysfunctional, the leadership would have to perceive the functional and dysfunctional elements of the existing culture and manage cultural evolution to change in such a way that the organization could survive in a new environment.

(Source: Organisational development model, 2010)

Case of the Digital Equipment Corp.

Digital Equipment Corp. (DEC) is a case study taken from Schein (2010) which reveal some important cultural dynamics that explain both the success and failure of DEC. Schein was a consultant to the founder of DEC, Ken Olsen, and to various executive committees and engineering groups that lead the DEC from 1966 to 1992 so he had gather a lot of useful information to test on.

The relationships within the company were open and inspired. At first when Olsen criticized someone openly, they would feel disgrace and thought that he did not like him or her. People might talk bad behind others back but still respect each other in work situation. The relationships of them seem to be easy to break. Different from his subordinates, Olsen Often criticized people in public, and might make them feel embarrassed. He explained to Schein that it only meant that the person being criticized should work on improving on his performance, not that he was really not be in favour of Olsen. He was just being used as an example for other employees. When this explanation was spread around, those managers or engineers who had been taken as example in the past and still thought that they were disfavour by Olsen regains their motivation and tried their best once again.

Their situations and solutions are draft as below:

(Source: Schein, 2010)

Olsen understood his engineers and managers and had put them in the situation that motivates them to take responsibility and do the right thing. The basic characteristic of a technology company is innovation and motivation. The Manager trusts them in their work and be honest with them. They made the employees thought that they are not just a normal company but a big family where members care for each other and when they criticized a person that was for their own good, not because they have something again that person. Olsen had create a great motivation working environment for his employees also increase the loyalty of them to the organization and respect with the senior managers. A little bit of misunderstand could make a different change in the whole organization. What people believe to be true always present in his or her working motivation.

DEC is a computer company, their products are emphasized in quality and elegance by the managers. The company was founded and dominated by engineer's mentality and the value of the proposed new product was normally judged base only the engineer's favour, not the market. The customers were not take into consider much. Olsen focus on their product, proudly view his company as highly ethical, best product with integrity in designing, manufacturing, and selling. He proud of his employees as being honest and trustful in their relationship with each other and with customers. As the company grew and mature, they put what they believes (these values) into formal statements and taught them to new employees.

The situations and solutions are draft as below:

(Source: Schein, 2010)

The best way to have your product sold is not making it as good as possible but making it as fit to what customers want as possible. Customers are those who buy the products, if you look down on them and just vainly proud in your products that mean you have given up your chance to do business. You should have been customized follow what the customers want not what you want to create. Also the belief that they are the best also been pass down to their new employees, that would make the situation go on for long without any improvement.

DEC had achieve a lot of success and go up to the number two computer company in the world but then in the 1990s it's rapidly decline due to the arrogant attitude of the organization. Even the company already got very large and differentiate, it is better to be focus in the market, and let the market decide what is best for them not the DEC engineer's "know best" product base on whether they like it or not.

The organization culture could inspire the employees on working more effective and lead to success of the organization but also can lead the employees on to the arrogant attitude that lead them to failure.


From the paper above, we can get a rough picture of what an organizational culture is. It is just a combination of basic norm and values that people might hardly take notice in but they in fact play an important role in deciding how the organization should function. If the organization in general and leadership in particular could not manage to understand culture of their own organization, they would be controlled by culture and got lost in the business world. We all want to understand culture but with manager that is a must have knowledge in order for them to lead.

From the example of DEC case study, we can see the impact of organization culture on the management of the organization could lead the organization to success or failure in just a blink of eyes.