MCom I Semester Employees Learn Culture Study Material Notes

MCom I Semester Employees Learn Culture Study Material Notes: Rituals Material Symbols Language Stories Ethical Organizational Culture Customer Responsive Culture Variable shaping Customers Responsive Cultures Spirituality and Organizational Culture Spirituality Managerial Action Characteristics of spiritual Characteristics Spiritual Organization Criticisms Spirituality Societal Cultural Values Summary Implication Managers :

BCom 1st year Insolvency Accounts Study Material notes In Hindi

How Employees Learn Culture

Culture is transmitted to employees in a number of forms, the most potent being stories, rituals, material symbols, and language.

Stories

During the days when Henry Ford II was chairman of the Ford Motor Co., one would have been hard-pressed to find a manager who hadn’t heard the story about Mr. Ford reminding his executives, when they got too arrogant, that “it’s my name that’s on the building.” The message was clear: Henry Ford II ran the company.

Nike has a number of senior executives who spend much of their time serving as corporate storytellers. And the stories they tell are meant to convey what Nike is about 40 When they tell the story of how cofounder (and Oregon track coach) Bill Bowerman went to his workshop and poured rubber into his wife’s waffle iron to create a better running shoe, they’re talking about Nike’s spirit of innovation. When new hires hear tales of Oregon running star Steve Prefontaine’s battles to make running a professional sport and to attain better performance equipment, they learn Nike mitment to helping athletes.

Stories such as these circulate through many organizations. They typically contain a narrative of events about the organization’s founders, rule-breaking Mesto-riches successes, reductions in the workforce, relocation of employees, reactions to past mistakes, and organizational coping. These stories anchor the present in the past and provide explanations and legitimacy for current practices

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Rituals

Kituals are repetitive sequences of activities that express and reinforce the key values of the organization-what goals are most important, which people are important, and which people are expendable.

One of the better known corporate rituals is Wal-Mart’s company chant. Begun by the company’s founder, Sam Walton, as a way to motivate and unite his workforce, “Gimme a W. gimme an A. gimme an L, gimme a squiggle, give me an M, A, R, TI” has become a company ritual that bonds WalMart workers and reinforces Sam Walton’s belief in the importance of his employees to the company’s success. Similar corporate chants are used by IBM, Ericsson, Novell, Deutsche Bank, and PricewaterhouseCoopers.45

Material Symbols

The headquarters of Alcoa doesn’t look like your typical head office operation. There are few individual offices, even for senior executives. It is essentially made up of cubicles, common areas, and meeting rooms. This informal corporate headquarters conveys to employees that Alcoa values openness, equality, creativity, and flexibility

Some corporations provide their top executives with chauffeur-driven limousines and, when they travel by air, unlimited use of the corporate jet. Others may not get to ride in limousines or private jets but they might still get a car and air transportation paid for by the company. Only the car is a Chevrolet (with no driver) and the jet seat is in the economy section of a commercial airliner.

The layout of corporate headquarters, the types of automobiles top executives are given, and the presence or absence of corporate aircraft are a few examples of material symbols. Others include the size of offices, the elegance of furnishings, executive perks, and attire. H These material symbols convey to employees who is important, the degree of egalitarianism desired by top management, and the kinds of behavior (for example, risk taking, conservative, authoritarian, participative, individualistic, social) that are appropriate.

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Language

Many organizations and units within organizations use language as a way to identify members of a culture or subculture. By learning this language, members attest to their acceptance of the culture and, in so doing, help to preserve it.

The following are examples of terminology used by employees at Knight-Ridder Information, a California-based data redistributors accession number (a number assigned to each individual record in a database); KWIC (a set of key-words-in-context); and relational operator (searching a database for names or key terms in some order). If you’re a new employee at Boeing, you’ll find yourself learning

whole unique vocabulary of acronyms, including: BOLD (Boeing online data); CATIA (computer graphics-aided three-dimensional interactive application); MAIDS (manufacturing assembly and installation data system): POP (purchased outside production); and SLO (service level objectives).

Organizations, over time, often develop unique terms to describe equipment, offices, key personnel, suppliers, customers, or products that relate to its business. New employees are frequently overwhelmed with acronyms and jargon that, after six months on the job, have become fully part of their language. Once assimilated, this terminology acts as a common denominator that unites members of a given culture or subculture,

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Creating an Ethical Organizational Culture

A strong organizational culture will exert more influence on employees than a weak one. If the culture is strong and supports high ethical standards, it should have a very powerful and positive influence on employee behavior, Johnson & Johnson, for example, has a strong culture that has long stressed corporate obligations to customers, employees, the community, and shareholders, in that order. When poi soned Tylenol (a Johnson & Johnson product) was found on store shelves, employees at Johnson & Johnson across the United States independently pulled the product from these stores before management had even issued a statement concerning the tamperings. No one had to tell these individuals what was morally right; they knew what Johnson & Johnson would expect them to do. On the other hand, a strong culture that encourages pushing the limits can be a powerful force in shaping unethical behav. ior. For instance, Enron’s aggressive culture, with unrelenting pressure on executives to rapidly expand earnings, encouraged ethical corner-cutting and eventually contributed to the company’s collapse.

What can management do to create a more ethical culture? We suggest a combination of the following practices:

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Creating a Customer Responsive Culture

French retailers have a well-established reputation for indifference to customers. Salespeople, for instance, routinely make it clear to customers that their phone conversations should not be interrupted. Just getting any help at all from a salesperson can be a challenge. And no one in France finds it particularly surprising that the owner of a Paris store should complain that he was unable to work on his books all morning because he kept being bothered by customers!

Most organizations today are trying very hard to be un-French-like. They are attempting to create a customer-responsive culture because they recognize that this is the path to customer loyalty and long-term profitability. Companies that have created such cultures—like Southwest Airlines, FedEx, Johnson & Johnson, Nordstrom, Olive Garden, Walt Disney theme parks, Enterprise-Rent-A-Car. Whole Foods, and L.L. Bean-have built a strong and loyal customer base and have generally outperformed their competitors in revenue growth and financial performance. In this section, we will briefly identify the variables that shape customer-responsive cultures and offer some suggestions that management can follow for creating such cultures.

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Key Variables Shaping Customer Responsive Cultures

A review of the evidence finds that half a dozen variables are routinely evident in customer-responsive cultures.

First is the type of employees themselves. Successful, service-oriented organizations hire employees who are outgoing and friendly. Second is low formalization Service employees need to have the freedom to meet changing customer service requirements. Rigid rules, procedures, and regulations! make this difficult. Third is an extension of low formalization-it’s the widespread use of empowerment. Empowered employees have the decision discretion to do what’s necessary to please the customer. Fourth is good listening skills. Employees in customer-responsive cultures have the ability to listen to and understand messages sent by the customer. Fifth is role clarity. Service employees act as “boundary spanners” between the organization and its customers. They have to acquiesce to the demands of both their employer and the customer. This can create considerable role ambiguity and conflict, which reduces employees job satisfaction and can hinder employee service performance. Successful customer-responsive cultures reduce employee uncertainty about the best way to perform their jobs and the importance of job activities. Finally, customer-responsive cultures have employees who exhibit organizational citizenship behavior. They are conscientious in their desire to please the And they’re willing to take the initiative, even when it’s outside their normal job requirements, to satisfy a customer’s needs.

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In summary, customer-responsive cultures hire service-oriented employees with good listening and the willingness to go beyond the constraints of their job description to do what’s necessary the customer. It then clarifies their roles, frees them to meet changing customer needs by minimizing rules and regulations, and provides them with a wide range of decision discretion to do their job as they see fit.

Managerial Action

Based on the previously identified characteristics, we can suggest a number of actions that management can take if it wants to make us Culture more customer responsive. These actions are designed to create employees with the competence ability, and willingness to solve customer problems as they arise.

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Selection

The place to start in building a customer-responsive culture is hiring service contact people with personalities and attitudes consistent with a high service orientation. Southwest Air is a shining example of a company that has focused its hiring process on selecting out job candidates whose personalities aren’t people friendly, Job applicants go through an extensive interview process at Southwest in which company employees and executives carefully assess whether candidates have the outgoing and fun-loving personality that it wants in all its employees.

Studies show that friendliness, enthusiasm, and attentiveness in in-service employees positively affect customers’ perceptions of service quality. So managers should look for these qualities in applicants. In addition, job candidates should be screened so new hires have the patience, concern about others, and listening skills that are associated with customer-oriented employees.

Training and Socialization Organizations that are trying to become more company that manages the responsive don’t always have the option of hiring all new employees. More technology back end of Web sites, obsesses on its dedication to typically management is faced with the challenge of making its current employees customers. To provide fanatical more customer-focused. In such cases, the emphasis will be on training rather than service, the company is organized hiring.

Structural Design Organization structures need to give employees more control. This can be achieved by reducing rules and regulations. Employees are better able to satisfy customers when they have some control over the service encounter. So management needs to allow employees to adjust their behavior to the changing needs and requests of customers. What customers don’t want to hear are responses such as I can’t handle this. You need to talk to someone else” or “I’m sorry but that’s against our company policy. In addition, the use of cross-functional teams can often improve customer service because service delivery frequently requires a smooth, coordinated effort across different functions.

Empowerment Consistent with low formalization is empowering employees with the discretion to make day-to-day decisions about job-related activities. It’s a necessary component of a customer-responsive culture because it allows service employees to make on-the-spot decisions to satisfy customers completely Enterprise Rent-A-Car, for instance, has found that high customer satisfaction doesn’t require a problem-free experience. The completely satisfied customer was one who when he or she had a problem, found that it was quickly and courteously resolved by an employee. By empowering their employees to make decisions on the spot, Enterprise improved its customer satisfaction ratings.

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Performance Evaluation There is an impressive amount of evidence demonstrating that behavior-based performance evaluations are consistent with improved customer service. Behavior-based evaluations appraise employees on the basis of how they behave or act-on criteria such as effort, commitment, teamwork, friendliness, and the ability to solve customer problems rather than on the measurable outcomes they achieve. Why are behaviors superior to outcomes for improving ser vicep Because it gives employees the incentive to engage in behaviors that are conducive to improved service quality and it gives employees more control over the conditions that affect their performance evaluations.65

In addition, a customer-responsive culture will be fostered by using evaluations that include input from customers. For instance, the performance evaluation of account managers at software company PeopleSoft is based on customer satisfaction and customers’ ability to use the company’s software. Just the fact that employees know that part of their performance appraisal will include evaluations from customers is likely to make those employees more concerned with satisfying customer needs. Of course, this should only be used with employees who have direct contact with customers.

Reward Systems Finally, if management wants employees to give good service, it has to reward good service. It needs to provide ongoing recognition to employees who have demonstrated extraordinary effort to please customers and who have been singled out by customers for “going the extra mile.” And it needs to make pay and promotions contingent on outstanding customer service.

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Spirituality and Organizational Culture

What do Southwest Airlines, Hewlett-Packard, The Men’s Wearhouse, AES, Wetherill Associates, and Tom’s of Maine have in common? They’re among a growing number of organizations that have embraced workplace spirituality

What Is Spirituality?

Workplace spirituality is not about organized religious practices. It’s not about God or theology. Workplace spirituality recognizes that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of community. Organizations that promote a spiritual culture recognize that people have both a mind and a spirit, seek to find meaning and purpose in their work, and desire to connect with other human beings and be part of a community.

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The Organisation System

Why Spirituality Now? Historical models of management and organizational behavior had no room for spirituality AS WE noted in our discussion of emotions in Chapter 4. the myth of rationality assumed that the well-run organization eliminated feelings. Similarly, concern about an employee’s inner lite had no role in the perfectly rational model. But just as we’ve now come to realize that the study of emotions improves our understanding of organizational behavior, an awareness of spirituality can help you to better understand employee behavior in the twenty-first century of course, employees have always had an inner life. So why has the search for meaning and purposefulness in work surfaced now? There are a number of reasons. We summarize them in Exhibit 16-5.

Characteristics of a Spiritual Organization

The concept of workplace spirituality draws on our previous discussions of topics such as values. ethics, motivation, leadership, and work/life balance. As you’ll see, for instance, spiritual organizations are concerned with helping people develop and reach their full potential. This is analogous to Maslow’s description of self-actualization that we discussed in relation to motivation. Similarly, organizations that are concerned with spirituality are more likely to directly address problems created by work/life conflicts.

What differentiates spiritual organizations from their nonspiritual counterparts? Although research on this question is only preliminary, our review identified five cultural characteristics that tend to be evident in spiritual organizations. Strong Sense of Purpose Spiritual organizations build their cultures around a meaningful purpose. While profits may be important, they’re not the primary values of the organization. Maximizing profits may excite investors but it rarely stirs employees’ emotions or imaginations. People want to be inspired by a purpose that they believe is important and worthwhile. Southwest Airlines, for instance, is strongly committed to providing the lowest airfares, on-time service, and a pleasant experience for customers. Tom’s of Maine strives to sell personal care household products that are made from natural ingredients and are environmentally friendly. AES, the world’s largest independent power producer, seeks to provide electricity around the globe and to fundamentally change people’s lives and their economic well-being

As a counterbalance to the pressures and stress of a turbulent pace of life. Contemporary lifestyles–single-parent families, geographic mobility, the temporary nature of jobs, new technologies that create distance between people underscore the lack of community many people feel and increases the need for involvement and connection. Formalized religion hasn’t worked for many people and they continue to look for anchors to replace lack of faith and to fill a growing feeling of emptiness Job demands have made the workplace dominant in many people’s lives, yet they continue to question the meaning of work. The desire to integrate personal life values with one’s professional life. An increasing number of people are finding that the pursuit of more material acquisitions leaves them unfulfilled.

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Focus on Individual Development Spiritual organizations recognize the worth and value of people. They aren’t just providing jobs. They seek to create cultures in which employees can continually learn and grow. The Men’s Wearhouse, as an illustration, believes its success lies in unlocking the untapped human potential in its people. To achieve this, for instance, the company’s training goes well bevond teaching employees how to sell or the specifics of men’s clothing. It also includes ses sions on how to be a better person and more available and accessible for ones’ friends, family, and colleagues.

Humanistic Work Practices The high-trust climate in spiritual organizations, when combined with the desire to promote employee learning and growth, leads to management implementing a wide range of humanistic work practices. These include flexible work schedules, group and organization-based rewards, narrowing of pay and status differentials, guarantees of individual worker rights employee empowerment, and job security.

For instance, managers in spiritually-based organizations are comfortable delegating authority to individual emplovees and teams. They trust their employees to make thoughtful and conscientious decisions. As a case in point, Southwest Airline emplovees–including flight attendants, customer service representatives, and baggage handlers-are encouraged to take whatever action they deem necessary to meet customer needs or help fellow workers, even if it means breaking company policies.

Recognizing the importance of people, spiritual organizations also try to provide employment security. Hewlett-Packard, for instance, has gone to extremes to try to minimize the effect of economic downturns on its staff. The company has handled temporary downturns through voluntary attrition and shortened workweeks (shared by all) and longer-term declines through early retirements and buyouts.

Toleration of Employee Expression The final characteristic that differentiates spiritually-based organizations is that they don’t stifle employee emotions. They allow people to be themselves express their moods and feelings without guilt or fear of reprimand. Employees at Southwest Air, for instance, are encouraged to express their sense of humor on the job, to act spontaneously and to make their work fun.

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Criticisms of Spirituality

Critics of the spirituality movement in organizations have focused on two issues. First is the question of legitimacy. Specifically, do organizations have the right to impose spiritual values on their employ cest second is the question of economics. Are spirituality and profits compatible

On the first question, there is clearly the potential for an emphasis on spirituality to make some employees uneasy. Critics might argue that secular institutions, especially business firms, have no business imposing spiritual values on employees. This criticism is undoubtedly valid when spirituality is defined as bringing religion and God into the workplace. However, the criticism seems less stinging when the goal is limited to helping employees find meaning in their work lives. If the concerns listed in Exhibit 16-5 truly characterize a growing segment of the workforce, then maybe the time is right for organizations to help employees find meaning and purpose in their work and to use the workplace as a source of community.

The issue of whether spirituality and profits are compatible objectives is certainly relevant for managers and investors in business. The evidence, although limited, indicates that the two objectives may be very compatible. A recent research study by a major consulting firm found that companies that introduced spiritually-based techniques improved productivity and significantly reduced turnover. Another study found that organizations that provide their employees with opportunities for spiritual development outperformed those that didn’t.62 Other studies also report that spiritual ity in organizations was positively related to creativity, employee satisfaction, team performance, and organizational commitment. And if you’re looking for a single case to make the argument for spirituality, it’s hard to beat Southwest Air. Southwest has one of the lowest employee turnover rates in the airline industry, it consistently has the lowest labor costs per miles flown of any major airline; it regularly outpaces its competitors for achieving on-time arrivals and fewest customer complaints; and it has proven itself to be the most consistently profitable airline in the United States.

Culture and Nations

As business gets global, the culture of a country becomes an important determinant of peoples behavior. Stories, rituals, language, traditions etc. of the country impacts the culture of the organization of that country. For instance, cultures differ widely in terms of their concept of time. Besides the obvious implications for punctuality, the difference also lies in how people from different cultures use their time. Many western cultures (eg. U.S., Germany, Switzerland etc.) are highly ‘monochronic’, i.e., people from these cultures prefer to deal with one task at a time. Thus, it is normal that a German would plan out every activity in a step-by-step manner. On the other hand, many Latin and Asian countries (e.g. India, Brazil, Spain, Arab Countries etc.) have a ‘polychronic’ orientation, i.e., it is quite normal for people to deal with more than one activity at the same time, it would not be unusual for an Italian or Latin America to interrupt a meeting to make a personal call).

People from polychronic cultures find monochronic cultures too mechanical, compartmentalized, and rigid. On the other hand, people from a monochronic background find polychronism to be an evidence of lack of focus and sincerity.

Similarly, in more individualistic countries (e.g., U.S., Australia, U.K. etc.). it is culturally acceptable to speak one’s mind and express disagreements. For a person coming from a collective culture (e.g., Mexico, Indonesia, Japan, China etc.), such expressions would be perceived as discourteous. and even aggressive. On the other hand, in collective cultures, disagreements are expressed (if at all) in more subtle manner, which to a person coming from individualistic culture, would look as dishonest and lacking in trustworthiness.

Social Institutions

Countries differ considerably in the kind of social institutions they have – e.g., the way their educak tion system functions, the way financial system works, the structures of governance etc.-which have a direct impact on how business is conducted in that country. While often not recognized as such these social institutions are important repositories of a country’s culture, and often embody its basic values and assumptions. The educational system in Germany has a heavy emphasis on technical and apprenticeship training. It is quite common for the CEO of a German company to have grown through the Meister system of apprenticeship training, while the MBA education is quite unknown

In contrast, in France, which is a hierarchical society, the Grand Ecoles are the elite schools, tha train future “administrators” for both industry and government. This institution also accounts for relatively smoother interface between government and industry, as compared to many other countess reg. in India where government bureaucrats and the managerial cadre come from different educational backgrounds).

Similarly, one finds the cultural values of individualism and entrepreneurship embodied in the American venture capitalist system. A middle level manager in a U.S. company is often more concerned by “shareholder returns” than his counterpart in a German or Japanese company. (In Japan, in fact, a large proportion of shares are held through crossholding among different companies of the same keisu. Thus, the concept of investors in Japan is very different as compared to U.S. share market. In many U.S. companies, variable pay and compensation are tied to the company’s share prices, which would be culturally unacceptable in countries such as Germany or Japan.

Public Policy and Legal Framework

Government policies and legal systems of different countries also often reflect the cultural values of the country. These legal and policy frameworks influence business practices in two ways: (1) they determine the broad framework for doing business in a country, and (2) they influence and circumscribe management practices within the company.

For instance, the Co-Determination Act in Germany reflects the formalized but egalitarian values of the German society. Just as German culture is based on a clear role division, in which the rights and obligations of every person is accepted, this Act provides for sharing of power between the management and the unions. Thus, for example, in Germany, unions have a greater say on issues such as piece work rates, job design, compensation, etc., as compared to many other countries. Infact, unions even have veto power over management decisions related to training, selection criteria and recruitment, reassignment etc.

Similarly, since Islamic values do not permit interest-based transactions, in many Muslim countries in the Middle-East, insurance policies are not taken, either for people or for goods (since money is eamed on premiums through interest-bearing investments). In Malaysia, however, in 1984, the government implemented an insurance system though the Takaful Act, (meaning “guaranteeing each other”) which is consistent with Islamic values, and beneficial to both the insurer and the insured.

It is also interesting to note that often, cultural values influence the interpretation and implementation of laws. For instance, in Japan, while the various legal codes are similar to those in Ger many and the U.S., they are practiced very differently. Though a Contract Law exists, detailed legal contracts are rarely made among Japanese companies. Being a collective culture, where working together, interpersonal trust, and “face matters a lot, agreements even involving major corporate investments are made in mutual good faith. If a written contract is made, it is normally short and often with very flexible wordings (in contrast to the long and extremely detailed German contracts). Moreover, even when it contract is broken, it is normal for the two parties to settle the dispute through negotiation and conciliation, rather than starting legal proceedings (that would be shame ful for both, since it would mean that they were unable to resolve their conflicts amicably).

Another unique public policy is life-time employment in Japan, which is rooted in a literal inter pretation of Article 27 of Japanese Constitution (“All people shall have the right and obligation to work”). It is interesting to note that Japan is not the only country to have “right to work as a part of its Constitution. However, it is the only country where it has been implemented earnestly, because it is supported by its cultural value of shakaisei (social consciousness) and tate shakai (social hierarchy and paternalism). In contrast, while the U.S. Constitution also guarantees the right to work, the cul tural value of self-reliance and “each for him” does not support it.

Cultural values also often determine the nature of laws, which have direct implication for man agement practices within the company. For instance, in the U.S. during a recruitment interview it is illegal to ask any questions about the candidate’s marital status, family background, spouse’s occu pation, race or religion etc. This may look odd to people from other cultures (es. India or Japan where a person’s background is seen as indicative of his or her potential and competence. However Such legal requirements are quite congruent to the U.S. cultural values, which emphasize individualism, privacy, and equal opportunity.

Societal Cultural Values

The most pervasive impact on the business culture and practices in a country comes from the broad cultural values of society. These values influence the business in different ways, and at different levels.

Firstly, at a macro level, cultural values allow certain kinds of businesses to flourish, while not providing the right climate for others. For example, French culture is known for its emphasis on elegance, elitism, and concern regarding form. Not only is this reflected in its 1200 museums, its 5000 varieties of wines (which are classified, like the French society, in a range starting from superior to ordinary table wine), more than 50,000 drama performances per year, but also in the fact that France has always been the capital of the fashion industry.

On the other hand, Mexican culture is known for its “pro-death” values. Mexicans celebrate ‘The Day of the Deads.’ Folk art forms, the skeletons feature, have Museums of Mummies, adorn their graves as a work of art, and even have a popular magazine called La Calavera (meaning The Skele ton)!! Not surprisingly, the life insurance industry is not a flourishing business in Mexico. In the mid90s, less than 20 percent of the employed population had life insurance cover, and insurance premium formed just about 1.5 percent of the GDP (as compared to 5.5 percent in Brazil, and close to 9 percent in the U.S.).

Secondly, the cultural values of the society define the meaning and reason of a business, and how it is organized. In many cultures, high profits and market capitalization are not the criteria for doing business. In many Arab and Latin countries (e.g. Italy, Spain, Latin American countries, Saudi Arab etc.) the business firm is seen as an extension of family, and family honor comes before profits. Similarly, in France, business firms are culturally seen as social institutions that uphold national pride.

Such cultural differences have a direct impact on the strategic orientation of companies across cultures. For instance, one study of comparison between the financial and strategic focus of U.S. and Japanese companies found that while U.S. companies emphasized more on the profits, dividends, and stock prices, Japanese companies focused more on new product development and market share.

Cultural values also influence how a business is organized and conducted in a particular society. In collective societies (e.g., China, Saudi Arab, Spain, etc.), for instance, personal contacts play an important role in conducting business. For instance, the guanxi (interpersonal relationships) system in China, encourages people to conduct business based on personal relationships. This is in sharp contrast to more individualistic societies, where personal relationships are deliberately kept away from professional relationships.

Similarly, consider Japanese tradition of keiretsu. A keiretsu (e.g.. Sanwa Group. Mitsubishi Group, Mitsui Group etc.) normally consists of a network of trading companies, manufacturing companies, banks, insurance companies, and many satellite manufacturing units. What binds them together are a number of business linkages, such as interlocking, shareholding, intra-group loans, and intra-group trade. The close-knit nature of the keiretsu helps the group to avoid hostile takeovers, share knowledge, avoid redundancies by reallocating people within the group, keep prices in control through preferential buying etc. The structure and working of keiretsu clearly reflects the Japanese values of collectivism and interdependence.

Lastly, cultural values have a major influence on the way people relate to each other and what they aspire for in a job. In many hierarchical cultures, the meaning and value of job lies in its status, more than in its pay packet. In these cultures, people also expect to be recognized for their seniority.

Summary and Implications for Managers

Exhibit 16-8 depicts organizational culture as an intervening variable. Employees form an overall subjective perception of the organization based on factors such as degree of risk tolerance, team emphasis, and support of people. This overall perception becomes, in effect, the organization’s culture or personality. These favorable or unfavorable perceptions then affect employee performance and satisfaction, with the impact being greater for stronger cultures.

Just as people’s personalities tend to be stable over time, so too do strong cultures. This makes strong cultures difficult for managers to change. When a culture becomes mismatched with its envi ronment, management will want to change it. But as the Point-Counterpoint debate on page 509 demonstrates, changing an organization’s culture is a long and difficult process. The result, at least in the short term, is that managers should treat their organization’s culture as relatively fixed.

One of the more important managerial implications of organizational culture relates to selection decisions. Hiring individuals whose values don’t align with those of the organization is likely to lead to employees who lack motivation and commitment and who are dissatisfied with their jobs and the organization. Not surprisingly, employee “misfits” have considerably higher turnover rates than individuals who perceive a good fit.

We should also not overlook the influence socialization has on employee performance. An employee’s performance depends to a considerable degree on knowing what he should or should not do. Understanding the right way to do a job indicates proper socialization. Furthermore, the appraisal of an individual’s performance includes how well the person fits into the organization. Can he or she get along with coworkers? Does he or she have acceptable work habits and demonstrate the right attitude? These qualities differ between jobs and organizations. For instance, on some jobs. employees will be evaluated more favorably if they are aggressive and outwardly indicate that they are ambitious. On another job, or on the same job in another organization, such an approach may be evaluated negatively. As a result, proper socialization becomes a significant factor in influencing both actual job performance and how it’s perceived by others.

Organizational culture is also determined by the culture of the country. With liberalization, it is important to understand the culture of the country in the context of its society, social institutions. public policy and legal framework, and societal cultural values. While understanding such differences it is essential that it develops educated global managers by providing them an understanding into the deeper structures that mould the culture.

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