ORGANIZATIONAL CULTURE
Multiple theoretical roots of cultural analysis:
Cultural anthropology:
Ethnographic, qualitative methodologies
“A system of shared beliefs, values, customs, behaviours, and artifacts that the members
of society use to cope with their world and with one another, and that are transmitted from
generation to generation through learning.” (Boas)
Field theory:
analytic separation of person and social context: “org climate” (Lewin)
Interpretivist sociology: Symbolic Interaction
(Mead); Phenomenology (Schutz);
Social constructivism (Berger & Luckmann); Ethnomethodology (Garfinkel)
Social reality is constructed and given meaning through human interactions, mediated by
use of symbols and interpretations of one another’s actions
Institutionalist: Four carriers cross-classify the three institutional pillars
Symbolic & relational systems, routines, artifacts (material culture) (Scott 2001:77)
Post-Modernist: contra modernism’s positivist rationality, knowledge is fundamentally
fragmented, multiplicitous, contradictory; all cultural generalizations are ambiguous
New sociology of culture: “considers material products, ideas, and symbolic means
and their relation to social behavior” (ASA Section on Culture) <http://www.newcollege.usf.edu/culture/>
Corporate Culture
Edgar Schein’s proposed an Assumptions-Values-Artifacts framework:
Corporate Culture: A variable internal to an organization that explains
its work-related structures, practices, outcomes
Corporate culture constitutes a collective purpose that becomes morally
binding on all organizational participants
“The pattern of basic assumptions that a given group has
invented, discovered, or developed in learning to cope with its
problems of external adaptation and internal integration, and that
have worked well enough to be considered valid, and, therefore to
be taught to new members as the correct way to perceive, think,
and feel in relation to those problems.”
(Schein 1994)
Shared beliefs: self-regulatory rules shape cognitive and affective aspects
of membership in the organization
• Integrated/unitary perspective at org’l level: consistency-consensus
about goals, intrinsic rewards & sanctions
• Internalization via socialization & learning processes
Cultural Dynamics
Mary Jo Hatch expanded Schein’s trinity into a cultural dynamics model
of four concepts (“VASA”) with bi-directional processes. Cultural
changes occur via interplay of four clockwise & counter-clockwise
influences evolving over time, generating a spiraling double-helix:
VALUES
Realization
Manifestation
ASSUMPTIONS
ARTIFACTS
Interpretation
Symbolization
SYMBOLS
The Domain of Cultural Dynamics (Hatch 1993)
Values & Assumptions
Assumptions and Values are deep-structure elements
Assumptions: taken-for-granted beliefs about reality & human nature
Values: social principles, philosophies, goals, and standards considered to
have intrinsic worth
Manifestation occurs when specific values, behavioral norms are
evoked perceptually, cognitively, or emotionally
Realization occurs when values are expressed in outcomes or acts
3M Corp describes itself as a “Culture of Innovation”
• What underlying assumptions does 3M make
regarding human creativity and learning
capabilities?
• How are those assumptions manifested as
values of employees in R&D dept, product
marketing, human resource management?
• Which org’l artifacts express 3M’s values
(e.g., reward ceremonies)?
Artifacts & Symbols
Artifacts and Symbols are surface components of org’l culture
Artifacts: the visible, tangible and audible results of activity that are grounded
in values and assumptions
Symbols: anything that represents a conscious or unconscious association
with some wider, usually more abstract concept or meanings
Symbolization translates artifacts into symbols, linking an
artifact’s literal meaning to its subjective meanings
Interpretation links previous assumptions to possibilities for
new symbolic understandings
EX What symbolic meanings do you attach to these artifacts?
Have their meanings changed as result of recent events?
Symbolic Buildings I
Corporate cultures are encoded in org’l languages, ideologies,
narratives (“story-telling”), metaphors, rituals, myths & ceremonies
• Slogans: IBM “Think”; Saturn “A different kind of car company”
• Logos, brand names, advertising campaigns: “An army of one”
• Physical layouts, design, décor, & architecture
What corporate cultural assumptions & values do you see manifested in the
Walt Disney Company’s corporate headquarters building in Burbank, CA?
Symbolic Buildings II
What different set of assumptions and values are expressed by
the just-opened Walt Disney Concert Hall in Los Angeles?
(Designed by Frank Gehry, also architect of UM’s Wiseman Art Museum)
Symbolic Buildings III
Now consider the Chiat Day advertising firm, whose clients
include Apple Computer, Seagram, Levi Strauss
What’s the meaning of the entrance to their Venice, CA, building?
(Another Gehry design, in collaboration with pop artist Claes Oldenburg)
What is the U of M Culture?
We all know something about the organizational culture (and
subcultures) of the University of Minnesota. Let’s see whether
we can collectively identify some of the U’s core assumptions,
values, artifacts, and symbols:
• Each group works on one of the 4 components
• Re-assemble and list some of these elements
• Discuss how these cultural elements are connected
• How and why is the University’s culture changing?
Charismatic Leadership
Hatch (2002) adapted Max Weber’s theory of charismatic
leadership to explain both cultural stability & org’l change
• Charismatic leader (“entrepreneur”) introduces new artifacts
into org’l culture; e.g., policies, programs, rhetorical styles
• Change occurs only if followers transform artifacts (incl.
leader’s example) into symbols having new meanings within
culture’s existing frames of meaning
• Routinization of charisma dampens revolutionary impacts,
“makes change possible by blending it with stability (i.e.,
giving it continuity and coherence)”
General Electric CEO Jack Welch widely seen as super-manager
whose confrontational style (“Neutron Jack”) legitimated cutting
costs & employees to boost corporate profits
Did Welch create innovations that made GE a model to emulate,
or was his genius in understanding changes well under way &
positioning himself at the head of the parade?
Strong Culture  Performance + Control
“Strong” Corp Culture enthusiasm emerged in 1980s academic &
practitioner writings (e.g., Peters & Waterman In Search of Excellence)
• General org’l mission statement sustains high member commitments
• Strong culture provides guidelines for effective actions
• Source of meanings & member identities (1950s “organization men”)
Strong cultures produce superior individual & collective performances
• Exemplars: 3M, IBM, Kodak, HP; Nonexemplars: Enron, K-Mart, etc
• Strong culture is difficult to imitate/transplant; its competitive advantage
lies in its reproductive rarity
Strong culture is a social control mechanism for reducing supervision
• Origins in an entrepreneurial leader’s values, norms, vision
• Learning an org culture: Recruiting & socializing newcomers to inculcate
commitment (Military boot camp; cult indoctrination; monastic rituals)
• Validation, reinforcement through folklore, stories, legends, interpreting
org’l history as consistent with its cultural values
Organizational Subcultures
Subcultures: Given the evident ambiguities held by many organizational
participants, the assumption of a unitary corporate culture is questionable
Differentiated org’l subcultures arise and persist, especially among diverse
occupational communities that make differing, conflicting assumptions about
what values are important to uphold
• Alternative values and interests, competing occupational commitments
overwhelm conformity to a single corporate culture
• Many participants resist the culture & ideology imposed by the org’s
dominant coalition (owners, managers)
Schein identified three conflicting subcultures inside many companies,
whose integration requires the organization to understand better
how these occupational communities learn and interact.
What incompatible assumptions and values are held by:
1. Executives – in charge of overall corporate strategic direction
2. Engineers – professionals engaged in research & design
3. Operators – direct production & service activities
NASA’s Catastrophic Subcultures
Columbia shuttle breakup was 2nd NASA catastrophe in 111 flights.
Review panel: “NASA’s organizational culture had as much to do with
this accident as foam did.” Conclusion echoes Diane Vaughan’s
(1996) analysis of 1986 Challenger shuttle disaster, when NASA
decided to launch despite unknown combination of brittle O-rings + ice.
“Culture of production:” crucial information was
structurally dispersed & managers were unable to
assemble credible evidence of a looming disaster
Loosely coupled subcultures weakened NASA safety
systems  “normal accident” (Perrow)
Performance pressures arose from the fatal interplay of political,
bureaucratic, and technical subcultural scripts
• Engineers followed an extrapolation paradigm, putting faith in built-in
redundancy and deference to administrative authority
• NASA managers’ adversarial review process, which demanded “proof” to
halt launches, effectively silenced engineers with tacit reservations
A Walk on the Darkside of Culture
Root of both culture & cult from Latin “cultus” = cultivate, care, adoration
Greedy Institutions: Pathologies of unconstrained self-demands when
members internalize the organizational culture into a total-institution identity
Personality absorbed into org’l mission, to neglect of alternative external ties
Structural isolation, milieu control facilitate asymmetric flows of information
At extreme, org may demand members sacrifice their resources, even lives
• “Coercive persuasion” in Korean POW
camps (Schein)
• Doomsday cults (Jonestown, Solar Temple,
Heaven’s Gate)
• Direct sales orgs: Mary Kay Cosmetics;
Herbal Life; Amway
• Mann Gulch: “Drop your tools or die!” 
loss of firefighter identity
National vs Org’l Cultures
National Cultures: Societies have distinct value configurations and
ways of life that emerged through historical experiences, institutional
developments originating in traditional family and kinship systems
Proposition: National cultures shape distinctly different org’l cultures
Orgs are cultural objects -- sets of beliefs and practices -- that inevitably
reflect the external contexts, environments within which they are embedded
Lammers & Hickson (1979) orgs reflect three broad national cultures
• Latin (Fr-Sp-It): high centralization, rigid strata, sharp inequality,
conflicts erupting around areas of uncertainty
• Anglo-Saxon (US-Br-Scand): decentralization, fluid strata, flexible rule
applications
• Traditional (3rd World): paternalistic leaders, implicit rules, elite
collusion
EX: Different beliefs about legitimacy of huge ratios of executive
compensation to worker wages: US >> Europe > Japan
A Globalizing Org’l Culture?
Are globalization processes creating a worldwide org culture?
Multinational corps (MNC) subsidiaries serve as the primary sites
for production of a managerial culture homogenization
Do MNC employees, especially top & middle managers, adopt corporate
culture or persist with distinct “host” national cultural values?
Hofstede (1980) Factor analyses of 120,000 IBM subsidiary managers’ core
work values uncovered 4 cultural dimensions
Power distance: accept inequalities of power, wealth, prestige
Uncertainty avoidance: accept innovation, eccentricities
Individualism: live and act independently or collectively
Masculinity: gender role separation, stress on advancement & earnings
Guillen (1994) updated Bendix’s (1956) classic on managerial ideologies
Content analysis of US, UK, German, Spanish management journals 1900-1975
Differential embrace of scientific mgmt, human relations, structuralism:
• Christian values diffused HR more in Spain & UK
• Scientific mgmt promoted by German military, US engineering profession
References
Bendix, Reinhard. 1956. Work and Authority in Industry: Ideologies of Management in the
Course of Industrialization. NY: Wiley.
Guillen, Mauro F. 1994. Models of Management: Work, Authority, and Organization in a
Comparative Perspective. Chicago: University of Chicago Press.
Hatch, Mary Jo. 2000. “The Cultural Dynamics of Organizing and Change.” Pp. 245-260 in
Handbook of Organizational Culture and Climate, edited by Neal M. Ashkanasy, Celeste
Wilderom and Mark F. Peterson. Thousand Oaks, CA: Sage Publications.
Hofstede, Geert. 1980. Culture’s Consequences: International Differences in Work-Related
Values. 2nd Ed. Beverly Hills, CA: Sage.
Lammers, Cornelis J. and David J. Hickson (eds.). 1979. Organizations Alike and Unlike:
International and Interinstitutional Studies in the Sociology of Organizations. London:
Routledge & Kegan Paul.
Vaughan, Diane. 1996. The Challenger Launch Decision: Risky Technology, Culture, and
Deviance at NASA. Chicago: University of Chicago Press.
Weick, Karl E. 1996. “Drop Your Tools: An Allegory for Organizational Studies.”
Administrative Science Quarterly 41:301.
How to Compare Mangoes & Guavas?
Geert Hofstede (1998) discusses problems in comparing national
cultures, arguing that values are more comparable than institutions.
His surveys of IBM international employees & the Chinese Value
Survey identified five core dimensions of national cultures:
• Power Distance
• Individualism/Collectivism
• Masculinity/Feminity
• Uncertainty Avoidance
• Long/Short-Term Orientation
How do the U.S. & China compare on these dimensions?
On which dimensions are they most similar & different?
Are incompatibilities on these cultural traits a source of
current & future conflicts between these nations?
Org’l Culture & Effectiveness
Daniel Denison & Aneil Mishra (1995) note paucity of evidence
showing that org’l cultures affect firm performance. They induce
propostions about four traits from five case studies, find CEO survey
evidence of differing effects on corporate outcomes (not controlling
for other causes/covariates):
Mission & Consistency predict profitability (ROA)
Involvement & Adaptability predict sales growth
Do their propositions constitute an org’l theory?
What mechanisms or processes might link variation
along these cultural dimensions to firm performance?
Do particular cultural configurations lead to superior
innovation, adaptation, environmental fit/selection?