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Chapter 17Chapter 17

Organizational Culture andOrganizational Culture and

Ethical BehaviorEthical Behavior

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What is Organizational Culture?

Shared values, beliefs, norms

influence the way employees think, feel,

and behave towards each other andtowards people outside the organization

Pattern of shared basic assumptions

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Building Blocks of

Organizational Culture

Characteristics of people within the

organization

Organizational ethics

Employment relationship

Organizational structure

National culture

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What are Organizational Values?

Guiding principles

behaviors, events, situations, and

outcomes are desirable or undesirable

Types

Terminal

Instrumental

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Terminal and Instrumental Values

Terminal

Quality

Responsibility Innovativeness

Excellence

Economy

Morality

Profitability

Instrumental

Working hard

Respecting traditions Respecting authority

Being conservative

Being frugal

Being creative

Being honest

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Figure 17.1 Terminal and

Instrumental Values

Organizational Values

Terminal

Values

Instrumental

Values

Specific norms,

rules, and SOPs

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Figure 17.2 Ways ofTransmitting

Organizational Culture

Employees

learn

through:

Formal socialization

practices

Signs, symbols, stories

Ceremonial

Rites

and

Ceremonies

The

organizational

language

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Ceremonial Rites

Rites of passage

Rites of integration

Rites of enhancement

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Figure 17.3 Where an Organizations

Culture Comes From

Organizational

Culture

Characteristics of People

Within Organization

Design of

Organizational Structure

Organizational

Ethics

Nature of

Employment

Relationship

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Figure 17.4 Sources of

Organizational Ethics

Organizational Ethics

Societal

Ethics

Professional

Ethics

Individual

Ethics

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Adaptive versus Inert Cultures

Adaptive Cultures

Values and norms

help organizationbuild momentum,

grow, and change to

achieve goals

Investment in

employees

Merit rewards

Inert Cultures

Values and norms fail

to motivate or inspireemployees

Stagnation

Minimal investment

in employees Little incentive for

improvement

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Hofstedes Model of

National Culture

Dimensions

Individualism vs Collectivism

PowerDistance

Achievement vs Nurturing Orientation

Uncertainty Avoidance

Long-term vs Short-term Orientation

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Individualism vs Collectivism

Individualism

Individual

achievement Freedom

Competition

Example

United States

Collectivism

Group harmony

Cohesiveness Consensus

Cooperation

Example

Japan

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Power

Distance

High

Inequalities exist

Gap between richand poor

Example

Guatemala

Malaysia

Low

Social welfare

programs reducegaps

Example

France

Germany

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Achievement vs Nurturing

Orientation

Achievement

Assertiveness

Performance Success

Competition

Results-oriented

Example

Japan

United States

Nurturing

Quality of life

warm personalrelationships

Service

Caring

Example Denmark

Sweden

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UncertaintyA

voidance

Low

Easygoing

Value diversity Tolerant of

differences

Example

United States Hong Kong

High

Rigid

Intolerant Conformity

Structure

Example

Japan

France

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Long-Term vs Short-Term

Orientation

Long-term

Thrift

Persistence High savings rate

Patience

Example

Japan

Hong Kong

Short-term

Personal stability

Happiness Living in the present

Example

United States

France

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Table 17.1 Culture

Dimensions

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Creating an Ethical Culture

Establish rules and norms that outline

organizations ethical position

Demonstrate commitment to followingrules

Reduce incentives for unethical behavior

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Creating an Ethical Culture

Develop fair and equitable HR

procedures

Provide access to upper-level managers

Encourage employees to voice concerns

Create a strong board of directors

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Why

Does Unethical Behavior Occur?

Lapses in Individual Ethics

Ruthless Pursuit ofSelf-Interest

Outside Pressure

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Opening Case: How 3M Built a

Culture for Innovation

How does 3Ms culture affect

creativity?

Cultural values and norms

Empowerment

Recognition

15% of time for personal projects