TEST BANK FOR ORGANIZATIONAL BEHAVIOR AN EVIDENCE-BASED APPROACH, 12 EDITION BY FRED LUTHANS| ALL CHAPTERS| LATEST GUIDE
Test Bank for Organizational Behavior An Evidence-Based Approach, 12 Edition by Fred Luthans
Test Bank for Organizational Behavior An Evidence-Based Approach, 12 Edition by Fred Luthans
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ORGANIZATIONAL CULTURE
Organizational culture refers to the set of shared meanings among the employees of an organization that
distinguishes it from other organizations. It creates the civilization of a population that determines
behavioral tendencies and activity styles.
Types of Org cultures—
There are different components and characteristics which come together to form an organization culture.
All these characteristics don't have to be present in a particular organization, several permutation
combinations exist which make an organization unique. Each of these characteristics exists on a
continuum from low to high.
1. Innovation and risk-taking. The degree to which employees are encouraged to be innovative and take
risks.
2. Attention to detail. The degree to which employees are expected to exhibit precision, analysis, and
attention to detail.
3. Outcome orientation. The degree to which management focuses on results or outcomes rather than on
the techniques and processes used to achieve them.
4. People orientation. The degree to which management decisions take into consideration the effect of
outcomes on people within the organization.
5. Team orientation. The degree to which work activities are organized around teams rather than
individuals.
6. Aggressiveness. The degree to which people are aggressive and competitive rather than easygoing.
7. Stability. The degree to which organizational activities emphasize maintaining the status quo in
contrast to growth.
Characteristics of organization culture–
1. It is descriptive rather than evaluative: Organizational culture shows how employees perceive the
characteristics of an org, not whether they like them—that is, it’s a descriptive term. It measures
how employees see the org, does it motivate them or encourage cohesiveness or togetherness; not
how they feel about the organization’s pay or their satisfaction with the org.
2. Culture exists at different levels: While there is a uniform culture throughout the organization,
which it is shared by all the employees there also exist several subcultures at different levels and
groups. While there is a dominant culture highlighting and expressing the uniform
‘corevalues’, and main characteristics of an organisation which gives rise to the personality of the
org, there also can exist multiple subcultures which include the problems, characteristics, and
experiences unique to a particular level, group or department imbued in the core values of the
org. This helps in maintaining the individuality of the group or the members. Eg TESCO can have
the dominant culture of shared values which decide the behavior of employees, but each
department might also have sub culture of values unique to the members.
3. Deeply internalized and widely recognized values form strong culture. The stronger the culture
the more influence it will have on the behavior, turnover, commitment and loyalty. In a strong
culture, employees know what is expected of them and carry out those expectations.
4. Culture is the non documented set of rules that are understood, predictable, and consistent.
Functions of org culture
Culture performs several roles, which can be functional and dysfunctional, and some of which may in the
future turn out to be a liability to the org.
1. Culture sets the boundaries and sets a unique identity of an organization that is different from
others. Establishing a unique civilization with certain values and norms establishes boundaries
and a unique identity for the org.
2. It creates a sense of shared identity and a common spirit of commitment. By stating what is
expected of the employees and what the organization represents, and ensuring that they are being
motivated and encouraged to achieve it, the culture instills a sense of commitment common in
employees, which is larger than their self-interest.
, 3. It also creates a social identity by providing standards for what employees should say and do.
Being in a civilization employees realize that they are a part of something bigger than themselves
and are glued together.
4. It also acts as a management and sense-making mechanism that ensures the adherence to certain
norms like commitment, attendance, turnover etc. without having to formally state it and
penalizing people for the same. Today’s trend toward decentralized organizations makes culture
more important than ever, but ironically it also makes establishing a strong culture more difficult.
When formal authority and control systems are reduced, culture’s shared meaning can point
everyone in the same direction. However, employees organized in teams may show greater
allegiance to their team and its values than to the organization as a whole
5. Having an established culture in place also helps in selecting and recruiting the right ‘individual
fit’ i.e the employee whose attitudes and behavior are compatible with the culture—strongly
influences who gets a job offer, a favorable performance review, or a promotion. It’s no
coincidence that Disney theme park employees appear almost universally attractive, clean, and
wholesome with bright smiles.
6. Another major role culture plays is creating the climate. Org climate is the the shared
perception about the organization amon the members, it is like the spirit of an organisation.
When everyone has the same general feelings about what’s important or how well things are
working, the effect of these attitudes will be more than the sum of the individual parts. A positive
overall workplace climate has been linked to higher satisfaction and financial performance as
well.
Culture can also become a liability however when it becomes dysfunctional.
1. When an organization undergoes institutionalization, it is valued for itself and not for the
goods or services it produces—it takes on a life of its own, apart from its founders or
members, behaviors and habits that should be questioned and analyzed start to be overlooked
and ignored, which can stifle innovation and make maintaining the organization’s culture an end
in itself.
2. Culture is a liability when the existing shared values don’t agree with those required for growth
and effectiveness. This is most likely when an organization’s environment is undergoing rapid
change, and its entrenched culture may no longer be appropriate.
3. Hiring new employees who differ from the majority in race, age, gender, disability, or other
characteristics creates a paradox: management wants to demonstrate support for the differences
these employees bring to the workplace, but newcomers who wish to fit in must accept the
organization’s core cultural values. Because diverse behaviors and unique strengths are likely to
diminish as people attempt to assimilate, strong cultures can become liabilities when they
effectively eliminate these advantages. A strong culture that condones prejudice, supports bias, or
becomes insensitive to people who are different can even undermine formal corporate diversity
policies.
4. A stringent and incompatible culture with oth other organizations can prevent mergers.
Creating and Sustaining culture
An organization’s culture doesn’t pop out of thin air, and once established it rarely fades away.
1. The beginning of a culture
The ultimate source of any org culture are the founders. Every founder has a vision and a goal and a
procedure to do things for the organisation, which later on expands into customs, traditions and
mechanisms. First, founders hire and keep only employees who think and feel the same way they do.
Second, they indoctrinate and socialize these employees to their way of thinking and feeling. And finally,
the founders’ beliefs are internalized into the employees through modeling. When the organization
succeeds, the founders’ personality becomes embedded in the culture. Founders with immeasurable
impact on their organization’s culture include Bill Gates at Microsoft, Ingvar Kamprad at IKEA, Herb
Kelleher at Southwest Airlines, Fred Smith at FedEx, and Richard Branson at the Virgin Group.
, 2. Keeping the culture alive
The selection process, performance evaluation criteria, training and development activities, and
promotion procedures ensure those hired fit in with the culture, reward those who support it, and penalize
(or even expel) those who challenge the organization’s culture.
Three forces play a particularly important part in sustaining a culture: selection practices, the actions of
top management, and socialization methods.
● Selection Process– Aside from the main goal of hiring individuals with the knowledge, skills,
and abilities to perform successfully, a major role of this process is to judge how well the
candidates will fit into the organization, identify people whose values are essentially consistent
with at least a good portion of the organization’s. Selection thus also becomes a two-way street,
allowing the employer or applicant to avoid a mismatch and sustaining an organization’s culture
by selecting out those who might attack or undermine its core values.
● Top Management The actions of top management also have a major impact on the organization’s
culture. Through words and behavior, senior executives establish norms that subtly send across
messages about desirable behv, for instance, whether risk-taking is desirable, how much freedom
managers give employees, what is appropriate dress, and what actions earn pay raises,
promotions, and other rewards.
○ Tony Hsieh, CEO of Zappos.com, is also the architect of the company’s culture.
Hsieh invited all employees to participate in creating ten core values that define the
culture of Zappos and serve as the framework from which all decisions are made.
The core values are: deliver WOW service; embrace and drive change; create fun
and a little weirdness; be adventurous, creative, and open minded; build a positive
team and family spirit; do more with less; and be humble. Hsieh maintains the
culture through the company’s hiring process and training programs to ensure that
employees are committed to the core values.
● Socialization No matter how good a job the organization does in recruiting and selection, new
employees need help adapting to the prevailing culture. What helps is – socialization, a process
where new recruits learn and are trained about the company and engage in some activities that
help them understand the culture of the organization. After they start work, they continue to learn
about the organization through an ongoing social networking application that links new workers
with more established members of the firm and helps ensure that culture is transmitted over time.
○ We can think of socialization as a process with three stages: prearrival, encounter,
and metamorphosis.
■ The prearrival stage-occurs before a new employee joins the organization.
recognizes that each individual arrives with a set of values, attitudes, and
expectations about both the work and the organization. One major purpose of a
business school, for example, is to socialize business students to the attitudes and
behaviors business firms want. Newcomers to highprofile organizations with a
strong market position will make their own assumptions about what it must be
like to work there. Most new recruits will expect Nike to be dynamic and
exciting, a prestigious law firm to be high in pressure and rewards, and the
Marine Corps to require both discipline and courage. No matter how well
managers think they can socialize newcomers, however, the most important
predictor of future behavior is past behavior. What people know before they join
the organization, and how proactive their personality is, are critical predictors of
how well they adjust to a new culture
■ encounter stage The stage in which a new employee sees what the
organization is really like and confronts the possibility that expectations and
reality may diverge.
■ metamorphosis stage, an attempt to work out any problems discovered
during the encounter stage, and tries to change and adopt the culture.
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