The Nature of Organizational Culture
Organizational culture has been defined in several different ways. In its most basic form, organizational culture can be defined as the shared values and beliefs that enable members to understand their roles and the norms of the organization. A more detailed definition is offered by organizational cultural theorist Edgar Schein, who defines it as a pattern of shared basicassumptions that the group learned as it solved its problems of external adaptation and internal integration, and that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.
Regardless of how the term is defined, a number of important characteristics are associated with an organization’s culture. These have been summarized as follows:
1. Observed behavioral regularities, as typified by common language, terminology, and rituals.
2. Norms, as reflected by things such as the amount of work to be done and the degree of cooperation between management and employees.
3. Dominant values that the organization advocates and expects participants to share, such as high product and service quality, low absenteeism, and high efficiency.
4. A philosophy that is set forth in the MNC’s beliefs regarding how employees and customers should be treated.
5. Rules that dictate the dos and don’ts of employee behavior relating to areas such as productivity, customer relations, and intergroup cooperation.
6. Organizational climate, or the overall atmosphere of the enterprise, as reflected by the way that participants interact with each other, conduct themselves with customers, and feel about the way they are treated by higher-level management.
Dimensions of Organizational Cultures
A research project similar to the IBM studies but focusing on organization rather than national cultures was carried out by Hofstede and a team of collaborators in the 1980s (Hofstede et al.,1990). Qualitative and quantitative data were collected in twenty work organizations or parts of organizations in the Netherlands and Denmark. The units studied varied from a toy manufacturing company to two municipal police corps. This study found large differences among units in perceptions of daily practices but only modest differences in values, beyond those due to such basic facts as nationality, education, gender and age group. Six independent dimensions allowed to describe the larger part of the variety in organization practices. These six dimensions can be used as a framework to describe organization cultures. The six dimensions were:
(1) Process-oriented versus results-oriented. Process-oriented cultures are dominated by technical and bureaucratic routines, results-oriented by a common concern for outcomes. This dimension was associated with the culture’s degree of homogeneity: in results-oriented units, everybody perceived their practices in about the same way; in process-oriented units, there were vast differences in perception among different levels and parts of the unit. The degree ofhomogeneity of a culture is a measure of its “strength”: the study confirmed that strong cultures are more results-oriented than weak ones, and vice versa (Peters & Waterman, 1982).(www.xing528.com)
(2) Job-oriented versus employee-oriented. The former assume responsibility for the employees’ job performance only, and nothing more; employee-oriented cultures assume a broad responsibility for their members’ well-being. At the level of individual managers, the distinction between job orientation and employee orientation has been popularized by Blake and Mouton’s Managerial Grid (1964). The Hofstede et al. study shows that job versus employee orientation is part of a culture and not (only) a choice for an individual manager. A unit’s position on this dimension seems to be largely the result of historical factors, like the philosophy of its founder(s) and the presence or absence in its recent history of economic crises with collective layoffs.
(3) Professional versus parochial. In the former, the (usually highly educated) members identify primarily with their profession; in the latter, the members derive their identity from the organization for which they work. Sociology has long known this dimension as ‘local’ versus ‘cosmopolitan’, the contrast between an internal and an external frame of reference (Merton, 1949).
(4) Open systems versus closed systems. This dimension refers to the common style of internal and external communication, and to the ease with which outsiders and newcomers are admitted. This is the only one of the six dimensions for which a systematic difference was found between Danish and Dutch units. It seems that organizational openness is a societal characteristic of Denmark more than of the Netherlands. This shows that organization cultures also contain elements from national culture differences.
(5) Tight versus loose control. This dimension deals with the degree of formality and punctuality within the organization; it is partly a function of the unit’s technology: banks and pharmaceutical companies can be expected to show tight control, research laboratories and advertising agencies loose control; but even with the same technology some units may still be tighter or looser than others.
(6) Pragmatic versus normative. The last dimension describes the prevailing way (flexible or rigid) of dealing with the environment, in particular with customers. Units selling services are likely to be found towards the pragmatic (flexible) side; units involved in the application of laws and rules towards the normative (rigid) side. This dimension measures the degree of “customer orientation”, which is a highly popular topic in the management literature.
Interaction Between National and Organizational Cultures
There is a widely held belief that organizational culture tends to moderate or erase the impact of national culture. The logic of such conventional wisdom is that if a U.S. MNC set upoperations in, say, France, it would not be long before the French employees began to “think like Americans”. In fact, evidence is accumulating that just the opposite may be true. Hofstede’s research found that the national cultural values of employees have a significant impact on their organizational performance, and that the cultural values employees bring to the workplace with them are not easily changed by the organization. So, for example, while some French employees would have a higher power distance than Swedes and some a lower power distance, chances are “that if a company hired locals in Paris, they would, on the whole, be less likely to challenge hierarchical power than would the same number of locals hired in Stockholm.”
Andre Laurent’s research supports Hofstede’s conclusions. He found that cultural differences are actually more pronounced among foreign employees working within the same multinational organization than among personnel working for firms in their native lands. Nancy Adler summarized these research findings as follows:
When they work for a multinational corporation, it appears that Germans become more German; Americans become more American; Swedes become more Swedish, and so on. Surprised by these results, Laurent replicated the research in two other multinational corporations, each with subsidiaries in the same nine western European countries and the United States. Similar to the first company, corporate culture did not reduce or eliminate national differences in the second and third corporations. Far from reducing national differences, organization culture maintains and enhances them.
(Adapted from: Hofstede, G. 2009. Dimensionalizing Cultures: The Hofstede Model in Context. [On-line]. Available Telnet: scholarworks.gvsu.edu; Luthans, F. & Doh, J.P. 2018. International Management: Culture, Strategy, and Behavior, Tenth Edition, New York: McGraw-Hill Education)
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