Organizational Culture and How It Affects the Decision and Outcomes of the Organization - Essay Example

What is an organizational culture? How does it affect the decision and outcomes of the organization? Can organizational culture be changed? Organizational culture can be sensed or felt, but it cannot be seen. It consists of attitudes, emotions, perceptions that influences the behavior, attitudes, and effectiveness of the employees. There is also no single definition of culture and it only involves assumptions, adaptations, perceptions, and learning that use symbols, language, ideologies, rituals, and myths in creating its beliefs, values and expectations. In a business setting, organizational culture is the shared philosophies, ideologies, values, assumptions, beliefs, expectations, attitude, and norms that knit the organization together. All of these interrelated psychological qualities reveal a group agreement, implicit or explicit, on how to approach decisions and problems or how things are done in a specific organization. It manifests in behavioral norms, hidden assumptions, and human nature, each occurring at a different level of depth within the organization. Studies have showed that organizational cultures are influenced by national cultures. Organizational culture differs not only from one business or industry to another but also from one country to another. In fact, industry and business culture are immensely influenced by national cultures. The dimensions of cultures between countries were categorized by Hofstede. Hoftstede formulated a cultural assessment tool whereby dimensions of one’s cultural strength can be assessed by assigning a scale ranging from 0 to 100 in the five cultural dimensions. This tool of Hofstede is a popular tool among managers who would like to understand another culture apart from their own. The five cultural dimensions of Power Distance, Individualism, Masculinity, Uncertainty Avoidance, and Long-Term Orientation; Hofstede’s five dimensions of culture in details are; Small vs. large power distance – This refers to how a society handles inequalities and the extent to which the less powerful members of organizations and institutions (like family) accept and expect that power is distributed unequally. Individualism vs. collectivism – Behavior towards community. The degree to which individuals are integrated into groups or are expected to look after themselves and self-actualize. Masculinity vs. femininity) – Behavior and roles distributed according to gender. (This dimension is often renamed by users of Hofstede’s work to Quantity of Life vs. Quality of Life because one of the notable findings in the IBM studies revealed that in ‘masculine’ cultures, people (whether male or female) value competitiveness, assertiveness, ambition, and the accumulation of wealth and material possessions whereas in ‘feminine’ cultures, people (again whether male or female) value relationships and quality of life. Weak vs. strong uncertainty avoidance – This refers to the level of need for structure. Cultures with low uncertainty avoidance tend to accept risk and change and prefer implicit or flexible rules and guidelines. Long vs. short term orientation – How much society values long-standing, as opposed to short term, traditions and values. Cultures with high long-term orientation place strong importance on family, discipline and social obligations These varying organizational cultures affect the decision and outcomes of the organization in manner that it dictates or sets the phase on how things should be done in an organization and how should manager approach the workforce considering the prevailing culture. A positive culture is often cultivated by management to be able to increase the productivity of the organization while keeping the people happy which reinforces further the positive and cohesive organizational culture. A positive organizational culture benefits the business enterprise because of its higher productivity outcome. When organizational culture is positive, people are motivated and get things done faster not to mention that they become more creative on how to do things better. For example, when there is a culture of strong camaraderie, employees tend to help each other and are happier to do their job and to stay in the organization. This produces higher output and lower retention rate in the organization. The reverse also follows that when there is a negative culture in an organization such as favoritism and gossiping, people tend to become demotivated and work less effectively. Many would also leave and this is not good for the organization. Organizational culture can be changed albeit it is not easy and takes time. If change is imposed, it will be met with resistance and ineffective that could instead produce a negative culture such as culture of resentment. But sometimes culture has to be changed because the business organization has to adapt in the ever changing world of business in order to survive and remain profitable. In sum, culture is the driving force that causes the organization to follow. A culture has positive impact on an organization when it points behaviors in the right direction, is widely shared among the group members, and exerts strong pressure on group members. If a culture is mobilized against the mission of the organization, it is better for the organization to have a weak culture (wrong direction, but not strong or pervasive among group members) than to have a strong counter culture (wrong direction, but very strong and pervasive). The impact of organizational culture however depends on its pervasiveness within an organization whether it is widespread, or shared among the members of the group. Managing cultural change is part of the function of management because change is inevitable especially in a business setting. Factors like the external and internal environment precipitates the need for change and the organization has to respond to remain viable and competitive as a business entity. The management function in dealing change is called change management. Implementing and managing change is not easy. People will always resist anything that is new. Such, people are a major focus in implementing change management because when people who are accustomed to their old ways, they are often hesitant to change especially if the change is unfamiliar to them or demands more from them. Management should not be tempted to impose change because that would make the effort to initiate change a disaster because people will resist it more. Change has to be carefully planned and slow and should focus on people because people are a major focus in implementing change management. It is the people who will ultimately cause the change to be a success or a failure and therefore, any change management effort should be directed towards them. The implications of change on individuals are important without which we can never really hope to manage large scale change effectively” (Murthy, 2007: 23). To effectively implement individual change, there are four approaches to make such change successful; they are behavioral, cognitive and psychodynamic. The behavioral approach is to make the reward strategies right to make individuals receptive to change. Basically this entails understanding how individuals perceive change and to understand what makes an individual tick. These approaches are important because without understanding an individual’s behavior, no amount of reward strategy can be successful. The cognitive approach is to link goals to motivation. When an individual is already understood on how he or she perceives change and has already identified the factors that will motivate the individual to be receptive to change, such willingness to adapt to change should be aligned with the organizational goals. The psychodynamic approach is to treat people as individuals and understand their emotional states as well as your own (Murthy, 2007). Simply put, treat others in the same manner we would like to be treated when we implement change. Read More