Organiza(onal Culture and Ethical Values
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Organiza(on Theory and Design Twel%h Edi+on Richard L. Da%
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What is Culture?
• Values, norms, guiding beliefs, and understandings that are shared by members of an organiza+on – Taught to new members as the correct way to think, feel, and behave
• Organiza+onal culture exists at two levels – Observable symbols – Underlying values
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Levels of Corporate Culture
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Emergence and Purpose of Culture Provides sense of organiza/onal iden/ty
Two cri+cal func+ons in organiza+ons:
• To integrate members so they know how to relate to one another
• To help organiza+on adapt to external environment
Internal Integra/on – collec+ve iden+ty and know how to work together
External Adap/on – how the organiza+on meets goals and deals with outsiders ©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Observable Aspects of Organiza+onal Culture
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Organiza+onal Chart for Nordstrom
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Organiza+onal Design and Culture
Managers want a corporate culture that reinforces the
strategy and structural design the organiza(on needs to be
effec(ve within environment.
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Culture Strength and Organiza+onal Subcultures
• Culture strength is the degree of agreement among members of an organiza+on about specific values
• Subcultures reflect the common problems, goals, and experiences of a team or department
• Different departments may have their own norms
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Organiza+onal Culture, Learning, and Performance
• Culture is important to learning and innova+on during challenging +mes
• Strong cultures include construc/ve adapta+on with the following values:
– Concern for employees and customers
– Flexible behavior
– Encouragement of risk taking, change, and improvement
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Construc+ve Versus Non-Construc+ve Cultures
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Ethical Values and Social Responsibility Ethics
– the code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong
Managerial Ethics
– Ethical decisions go beyond behaviors governed by law
– Managerial ethics guide the decisions and behaviors of managers
Ethical Dilemma
─ a situa+on concerning right and wrong in which values are in conflict
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Corporate Social Responsibility
• Corporate Social Responsibility management’s obliga+on to make choices and take ac+on so that the organiza+on contributes to the welfare and interest of all organiza+onal stakeholders- employees, customers, shareholders, the community, the broader society • Sustainability environmental efforts woven into all decisions
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 12
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Rela+onship between the Rule of Law and Ethical Standards
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Corporate Social Responsibility (CSR)
• Does it pay to be good? • Extension of the idea of managerial ethics • Increase in social responsibility • Customers and public are paying closer aden+on to what organiza+ons do
• Social responsibility can enhance a firm’s reputa+on
• Companies measure nonfinancial factors that create value
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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How Managers Shape Culture and Ethics
• Value-Based Leadership • Formal Structure and Systems
– Structure – Disclosure Mechanisms – Code of Ethics – Training Programs
• Managers play key role in providing leadership and examples of ethical behavior
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Manager Rankings of Ethical Values by Genera+on
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Characteris+cs of Values-Based Leaders
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Corporate Culture and Ethics in a Global Environment
• The global environment presents tough ethical challenges
• A global supply chain is an area of growing ethical concern
• Countries have varied ahtudes and beliefs • Components that characterize a global culture:
– Mul+cultural rather than na+onal values – Basing status on merit rather than na+onality
• Some companies work closely with overseas factories to improve working condi+ons
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Design Essen+als
v Cultural and ethical values help determine the organiza+on’s social capital and can contribute to success v Managers can use rites and ceremonies, stories, symbols, structures, control systems, and power rela+onships to influence culture
v Subcultures may emerge even in strong cultures
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Design Essen+als
v Strong cultures can be construc+ve or non- construc+ve vManagerial ethics and corporate responsibility are important aspects of organiza+onal values v Managers can shape culture and ethics through formal systems
v Global companies face challenges in establishing strong cultural and ethical values.
©2017 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part
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