MGMT1001 Lecture Notes - Lecture 9: Organizational Culture, Adhocracy, Formal System
18 May 2018
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9 – Organisational Culture, Structure and Design
Organisational culture – system of shared beliefs and values that develops within an
organisation and guides the behaviour of its members
• Organisational structure – formal system of task and reporting relationships that
oordiate ad otiate a orgaisatio’s eers so that they a ork together
to ahiee the orgaisatio’s goals
• Culture plus structure:
Vision → strategy → culture → structure and internal practices →collective
attitudes and behaviours → achievement of goals
Four types of organisational culture
• Clan culture – internal focus and values flexibility rather than stability and control
Employee-focus on collaboration and cohesion through consensus
• Adhocracy culture – external focus and values flexibility
Creating innovative products, encouraging risk-taking
• Market culture – competitive culture valuing profits over employee satisfaction
• Hierarchy culture – structures culture valuing stability and effectiveness
Three levels of organisational culture
• Observable artefacts – physical manifestations of culture
E.g. manner of dress, awards & stories about the company, rituals & ceremonies
• Espoused values – explicitly stated values and norms
Enacted values: values and norms actually exhibited in the organisation
• Basic assumptions – core values of the organisation
Core beliefs that employees have about the organisation, difficult to change
How employees learn culture
• Symbols – an object, act, quality or event that conveys meaning to others
• Stories – narrative based on true events, which is repeated, often embellished, to
emphasise a certain value
• Heroes – person whose accomplishments embody the values of the organisation
• Rites and rituals – activities and ceremonies, planned and unplanned, that celebrate
iportat oasios ad aoplishets i the orgaisatio’s life
The importance of culture
• Gives members an organisational identity
• Facilitates collective commitment
• Promotes social-system stability
• Shapes behaviour by helping employees make sense of their surroundings
Cultures for enhancing economic performance: three perspectives
• Strength – long-term financial success results when a firm has strong culture
• Fit – success results when culture fits, or aligns ith fir’s usiess context
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Document Summary
Vision strategy culture structure and internal practices collective attitudes and behaviours achievement of goals. Four types of organisational culture: clan culture internal focus and values flexibility rather than stability and control. Employee-focus on collaboration and cohesion through consensus: adhocracy culture external focus and values flexibility. Creating innovative products, encouraging risk-taking: market culture competitive culture valuing profits over employee satisfaction, hierarchy culture structures culture valuing stability and effectiveness. Three levels of organisational culture: observable artefacts physical manifestations of culture. E. g. manner of dress, awards & stories about the company, rituals & ceremonies: espoused values explicitly stated values and norms. Enacted values: values and norms actually exhibited in the organisation: basic assumptions core values of the organisation. Core beliefs that employees have about the organisation, difficult to change. The importance of culture: gives members an organisational identity, facilitates collective commitment, promotes social-system stability, shapes behaviour by helping employees make sense of their surroundings.
