Issues in Organizational Culture Change: A Case Study (1)

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ABSTRACT

As organizations adapt to be more effective in dynamic and competitive environments, the role of their organizational culture in either supporting or resisting internal changes is critical. The organization's leadership must seek a culture that fits with new strategic demands, and that culture itself may need to change as the strategy evolves. Helping leaders manage culture change effectively is the focus of this research. Changing a culture generally means changing some of the organization's values, beliefs, and customary ways of doing things. Such changes are often disruptive. They can violate implied (or actual) contractual agreements with various stakeholders based on established routines and patterns of past behaviors. It is like one team changing the rules of a game during the game. Depending on how this is done and communicated to the stakeholders (e.g., fans, referees, the other team), some parties to the game may view the changes as unfair, or even unethical. Leaders must be able to see, understand, and attend to these changes to reduce the likelihood of dysfunctional stakeholder behavior. We discuss culture as a strategic variable and consider the ethical dimension of culture change. By sharing an example of cultural change and misalignment in one organization, we are able to explore its process of coming to understand its culture and then begin to create a new culture to support its competitive strategy.

INTRODUCTION

Examining an organization's culture has become a target for organizational analysis. The emphasis on understanding social and symbolic processes of organizations has increased--rational aspects alone no longer dominate the management literature. The concept of culture is used to capture the essence of what must change or adapt within an organization for it to be more competitive in the marketplace.

Culture is the set of shared values, shared beliefs, and customary ways of thinking and doing things which shape and guide the behavior of organizational members. Its importance lies in its ability to influence the activities of members and the functioning of the organization without the direct imposition of measures and controls. Research shows that member perceptions of the organization's culture are associated with cognitive and affective sources of motivation and job satisfaction (Reichers & Schneider, 1990). Organizational climate--an organization's more temporal and local culture--is an intervening variable between organization design factors and work performance and job satisfaction (deWitte & de Cock, 1988). The concept of culture has been found useful in explaining the achievement of broad organizational goals such as innovation, service, and quality enhancement.

Culture is typically measured at the collective level by capturing the norms and expectations that exist in the organization that are intended to govern the behavior of its members. For example, some organizations are competitive--members feel they must out-perform one another. Other organizations are collaborative--members seek each other out to create joint products and outcomes. Culture, by this definition, becomes a powerful construct for researchers' study, and for practitioners to use in affecting member behaviors and thereby affecting their efficiency, satisfaction, and commitment to the organization (i.e., fewer withdrawal behaviors).

Culture measures have been used in many leadership and change situations. Its uses have ranged from assessing 'gaps' between an existing and future desired state of affairs to helping top management articulate strategic and structural changes for the organization.

Two questions emerge for those using culture as a construct for driving change:

(a) To what extent does culture, as an index of the norms, values, and beliefs of organizational members, have the power to guide change, foster adaptation, and yield competitive success? …