Keeping the Faith: A Model of Cultural Transmission in Formal Organizations

Article excerpt

To study the conditions under which culture can be transmitted effectivly in formal organizations, where members of the system come and go rapidly and in large numbers, we develop a model of the cultural transmission process. The model includes the following variables: entry rate and exit rate of workers, growth rate of the organization, selectiveness of organizational recruiting, intensity of socialization (by managers and by coworkers), and the rate at which socialization decays if not reinforced. Findings from a computer simulation of the model show that cultural systems in organizations are highly robust and reach equilibrium even with high turnover and rapid growth. We also find that culture is stronger durong decline than growth. Moreover, some alleged behavioral effects of culture might be explained by demographic processes rather than by psychological reactions to cultural content. In general, the model provides insights into the tradeoffs involved in cultural management.

No phenomenon has fascinated researchers of organizations more in the last decade than has organizational culture. Organizational behavior researchers have embraced the culture concept to study such central topics as commitment (Pascale, 1985), socialization (Schein, 1968), and turnover (O'Reilly, caldwell, and Barnett, 1989). Organizational theorists have come to see strong culture as an alternative to formal structure (Ouchi, 1981) and have used it extensively to understand Japanese organizations (Lincoln, Hanada, and McBride, 1986). And, of course, some writers in the popular business literature have prescribed careful management of corporate culture as the panacea for America's international competitiveness problems (Deal and Kennedy, 1982; Peters and Waterman, 1982).

Despite the volumes that have been written about organizational culture, little theory or research has examined specifically cultural transmission over time in formal organizational settings. Understanding cultural transmission is important because organizational culture is often highly persistent across time (Wilson, 1989). And, sonce the members of organizations can enter and leave the culture rapidly and in large numbers, the demography of the cultural system must be considered along with socialization processes if we are to understand how organizations maintain cultures. For this reason, we develop here a model of the cultural transmission process in formal organizations. In the tradition to Cohen, March, and Olsen (1972) and March (1991), the analysis of the model is based on a computer simulation, but its assumptions are derived from extant theory and established empirical studies. Included in the model are the following components of the transmission process: entry rate of organizational members, individual exit rate, organizational growth rate, selectiveness of recruitment procedures, intensity of socialization practices, and the natural decay rate of socialization. Our interest lies in the effects of each of these factors on the maintenance of organizational culture over time. To understand this problem, we conduct simulation studies in which we vary systematically most of the components of the model.

Analyzing the cultural transmission process of organizations in this way leads us to question certain commonly held beliefs about organizational culture. For instance, we will show that very rapid organizational growth sometimes facilitates rather than impedes cultural stability, when stability is viewed as the quickness with which the system reaches equilibrium or rebounds to it after perturbation. The simulations also show that some previously observed cultural patterns ascribed to behavioral processes might be accounted for entirely by demographic processes. Cultural intensity (denoted by mean level of enculturation of organizational members), for example, is found to be greater in declining organizations because of the dynamics of attrition, not because of some behavioral reaction to the decline (cf. …