Understanding
And
Managing
Organizational
Behavior
Chapter 17:
Organizational
Culture and Ethical
Behavior
4th Edition
JENNIFER GEORGE
& GARETH JONES
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©2005 Prentice Hall
Chapter Objectives
 Distinguish between values and norms and
discuss how they are the building blocks of
organizational culture
 Appreciate how a company’s culture is
transmitted to employees through its formal
solicitation practices and through informal
“on the job” learning
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©2005 Prentice Hall
Chapter Objectives
 Discuss five main factors that shape
organizational culture and explain why
different organizations have different
cultures
 Appreciate how differences in national
culture affect the culture of organizations
within a particular society
 Understand the importance of building and
maintaining an ethical organizational
culture
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©2005 Prentice Hall
Opening Case: How 3M Built a
Culture for Innovation
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How does 3M’s culture affect creativity?
Cultural values and norms
Empowerment
Recognition
15% of time for personal projects
©2005 Prentice Hall
Building Blocks of
Organizational Culture
 Characteristics of people within the
organization
 Organizational ethics
 Employment relationship
 Organizational structure
 National culture
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What is Organizational Culture?
 Set of shared values, beliefs, norms that
influence the way employees think, feel, and
behave towards each other and towards
people outside the organization
 Pattern of shared basic assumptions
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©2005 Prentice Hall
What are Organizational Values?
 Guiding principles people use to determine
which types of behaviors, events, situations,
and outcomes are desirable or undesirable
 Terminal
 Instrumental
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Terminal and Instrumental Values
 Terminal Values
– Desired end states of outcomes
 Instrumental Values
– Desired modes of behavior
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Figure 17.2 Where an Organization’s
Culture Comes From
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Characteristics of people within organization
Nature of employment relationship
Organizational ethics
Design of organizational structure
©2005 Prentice Hall
Figure 17.3 Ways of Transmitting
Organizational Culture
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Formal socialization practices
Ceremonial rites and ceremonies
Organizational language
Signs, symbols, stories
©2005 Prentice Hall
Ceremonial Rites
 Rites of passage
 Rites of integration
 Rites of enhancement
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Figure 17.4 Sources of
Organizational Ethics
 Social Ethics
 Professional Ethics
 Individual Ethics
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Hofstede’s Model of
National Culture
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Individualism vs Collectivism
Power Distance
Achievement vs Nurturing Orientation
Uncertainty Avoidance
Long-term vs Short-term Orientation
©2005 Prentice Hall
Table 17.2 Culture Dimensions
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©2005 Prentice Hall
Creating an Ethical Culture
 Establish rules and norms that outline
organization’s ethical position
 Demonstrate commitment to following rules
 Reduce incentives for unethical behavior
 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 of Self-Interest
 Outside Pressure
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©2005 Prentice Hall