The four phases of mentoring are initiation, cultivation, socialization, and definition.

14

ORGANIZATIONAL CULTURE, SOCIALIZATION, AND MENTORING

How Can I Use These Concepts to Fit, Develop, and Perform?

Major Topics I’ll Learn and Questions I Should Be Able to Answer

1. 14.1

THE FOUNDATION OF ORGANIZATIONAL CULTURE: UNDERSTANDING ITS DRIVERS AND FUNCTIONS

MAJOR QUESTION: What is culture and why is it helpful to understand its layers and functions?

2. 14.2

THE IMPACT OF ORGANIZATIONAL CULTURE TYPES ON OUTCOMES

MAJOR QUESTION: How are different types of organizational culture related to outcomes?

3. 14.3

MECHANISMS OR LEVERS FOR CULTURE CHANGE

MAJOR QUESTION: What mechanisms or levers can I use to implement culture change?

4. 14.4

EMBEDDING ORGANIZATIONAL CULTURE THROUGH THE SOCIALIZATION PROCESS

MAJOR QUESTION: How can I integrate the findings of socialization research with the three phases of socialization?

5. 14.5

EMBEDDING ORGANIZATIONAL CULTURE THROUGH MENTORING

MAJOR QUESTION: How can I use mentoring to foster personal and professional success?

The Organizing Framework in Figure 14.1 summarizes what you will learn in this chapter. Two person factors—human and social capital—and four situation factors—culture types, leader behavior, organizational climate, and human resource practices and policies—influence key processes at the individual, group, and organizational levels. In turn, these key processes support positive outcomes at all three levels. Concepts we discuss in this chapter have greater impact on individual and organizational outcomes than on group ones.

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FIGURE 14.1 Organizing Framework for Understanding and Applying OBA summary graphic outlining what will be learned in this chapter.

© 2014 Angelo Kinicki and Mel Fugate. All rights reserved. Reproduction prohibited without permission of the authors.. Access the text alternative for Figure 14.1. The Walt Disney Company was founded in 1923 by brothers Walt and Roy Disney. The company is much more than its theme parks. Today Disney is a diversified multinational mass media and entertainment company headquartered in Burbank, California. The company has a long reputation of having a strong culture aimed at being innovative and a fun place to work. In recognition of this theme, the Walt Disney Company was ranked as the 5th most Admired Company in 2016 by Fortune. Here we see a manifestation of the company’s culture in front of Cinderella’s Castle at Walt Disney World, Orlando, Florida. Thousands of families visit their theme parks to have fun and enjoy the outstanding service provided by employees. The strong customer-driven culture established by the Disney brothers is alive and well. This chapter will help you understand how companies like Disney create such cultures.© Ilene MacDonald/Alamy

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Winning at Work

How Would I Assess Person–Organization Fit (P-O) When Applying for Jobs?

Fitting in is important to everyone. When I was 7, my father put me on a baseball team composed of 8- and-9-year-old boys. He thought it would be good for my development, but I was smaller and less skilled than the other boys, and they treated me like an outsider who didn’t fit in. It did not help that I was the coach’s son. I hated the experience.

I also experienced a lack of fit at some of my early job positions. I valued things others did not and believed people were engaging in counterproductive actions. Some of my peers loved the job, the boss, and the work environment. They could not understand why I wasn’t happy, but I felt disengaged and started looking for a new job. That experience opened my eyes to the importance of “fitting in” at work.

What Does It Mean to Fit?

Person–environment fit (P-E) is “the compatibility between an individual and a work environment that occurs when their characteristics are well matched.” 1 Although there are many types of fit, we are interested in person–organization fit (P-O) , which reflects the extent to which your personality and values match the climate and culture in an organization. P-O fit matters because good fit is associated with more positive work attitudes and task performance, lower intentions to quit, and less stress. 2 The process of assessing fit begins during the recruiting phase. Your goal should be to discover whether you and the job or the organization are a good fit for each other.3

A photo of a puzzle piece.Fitting in at work is like doing a puzzle. When the pieces fit in the right pattern, all is well.© Corbis/Punchstock RF

How Can I Assess P-O Fit?

Assessing P-O fit will take some effort on your part. First, conduct an evaluation of your strengths, weaknesses, and values. Next, do the same for the company or department at hand by doing research about it online or talking with current employees. With this information you can prepare a set of diagnostic questions to ask during the interview process.4 For example, if you value recognition for hard work, ask a recruiter how the company rewards performance. If the answer does not support a strong link between performance and rewards, you probably will have a low P-E fit and will not be happy working at this company.

A Take-Away Application later in this chapter will help you practice the process of assessing person–organization fit.

How Can I Improve My Level of Fit?

· Find ways to build your strengths into your work role. Talk to your boss about how to redesign or modify your job to incorporate your strengths.

· Decide whether weaknesses are affecting your performance. If they are, seek developmental opportunities, coaching, or mentoring. If that does not work, find another role.

· Assess any misalignment between your values and those endorsed by the company. You can do this by writing down your five most important values and comparing them to your employer’s stated values. If they don’t overlap and you can’t accept the discrepancy, it’s time to move on.

· If you don’t fit at one job or location, consider a lateral move to another department. You may just need a different role or boss.5

What’s Ahead in This Chapter

This chapter begins your study of macro-level organizational behavior from the perspective of the organization as a whole. We start by exploring the foundation of organizational culture so you can understand its drivers and functions. Next, we review the four key types of organizational culture and consider their relationships with various outcomes. This is followed by a discussion of ways managers can change organizational culture. Finally, we discuss how socialization and mentoring serve to embed organizational culture, and we focus on how you can use knowledge of these processes to enhance your career success and happiness.

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14.1

THE FOUNDATION OF ORGANIZATIONAL CULTURE: UNDERSTANDING ITS DRIVERS AND FUNCTIONS

MAJOR QUESTION

What is culture and why is it helpful to understand its layers and functions?

THE BIGGER PICTURE

Although you may have a small impact on your employer’s organizational culture, you undoubtedly are affected by it. Culture affects outcomes at the individual, group, and organizational level. You are about to learn what creates organizational culture and how culture affects other organizational processes. You also will identify the three levels that constitute culture and the functions it serves for organizations.

The saying “Culture eats strategy for breakfast” was attributed to management expert Peter Drucker. But it really caught everyone’s attention when Mark Fields, CEO of Ford Motor Co., used it in 2006. The slogan currently hangs in the company’s “war room,” a meeting place where executives discuss the execution of Ford’s corporate strategies. Ford’s former CEO Alan Mulally created the room, which contains charts, graphs, and lists of products. The culture slogan serves as a reminder of the impact of organizational culture on Ford’s success. 6 Others agree with Ford’s emphasis on organizational culture.

Alan Murray, Fortune editor, studied the annual Best Companies to Work For lists and concluded that great companies don’t just provide “free food, generous benefits, and nap pods (although those clearly don’t hurt).” He believes that culture is the essence of what makes great companies. “Today’s workers are looking for a corporate culture that values them and their contributions,” he said.7

Bruce Arians, head coach of the Arizona Cardinals NFL team, also believes in the power of corporate culture. When asked by a reporter to comment on the team’s success over two recent seasons—the Cardinals won 34 of 48 regular-season games—he said, “It’s the culture in your locker room. Culture beats talent anytime, and we have great culture, great leadership, and great accountability in our locker room.”8

One of our primary goals in this chapter is to help you understand how managers can use organizational culture as a competitive advantage. We start by considering the foundation of organizational culture.

Defining Culture and Exploring Its Impact

Organizational culture is defined as “the set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and reacts to its various environments.” 9 This definition highlights four important characteristics of organizational culture:

· Shared concept. Organizational culture consists of beliefs and values shared among a group of people.

· Learned over time. Culture is passed to new employees through the processes of socialization and mentoring, discussed later in this chapter.

· Page 548Influences behavior at work. Its influence on behavior is the reason “culture eats strategy for breakfast.”

· Affects outcomes at multiple levels. Culture affects outcomes at the individual, group/team, and organizational levels.

Figure 14.2 provides a conceptual framework for understanding the drivers and effects of organizational culture. Five elements drive organizational culture:

· The founder’s values.

· The industry and business environment.

· The national culture.

· The organization’s vision and strategies.

· The behavior of leaders.

FIGURE 14.2 Drivers and flow of organizational cultureA summary graphic of the elements of organizational culture. SOURCE: Adapted from C. Ostroff, A. J. Kinicki, and R. S. Muhammad, “Organizational Culture and Climate,” in Handbook of Psychology, vol. 12, 2nd ed., I.B. Weiner, N.W. Schmitt, and S. Highhouse, eds. (Hoboken, NJ: Wiley, 2013), 643–676. Reprinted with permission of John Wiley & Sons, Inc.

In turn, organizational culture influences the type of organizational structure a company adopts and a host of internal processes (including human resource practices) it implements in pursuit of its goals. These organizational characteristics then affect a variety of group and social processes. 10 This sequence ultimately affects employees’ work attitudes and behaviors and a variety of organizational outcomes. All told, Figure 14.2 tells us that organizational culture has a wide span of influence, ultimately influencing many individual, group, and organizational outcomes. 11 Once again, this is the reason culture eats strategy for breakfast.

The Three Levels of Organizational Culture

Organizational culture operates on three levels:

1. Observable artifacts.

2. Espoused values.

3. Basic underlying assumptions.

These levels differ in their visibility and resistance to change, and each one influences another. Let’s look at them one by one.

Level 1: Observable Artifacts

At the most visible level, culture consists of observable artifacts. Artifacts are the physical manifestation of an organization’s culture. They include:

· Acronyms.

· Manner of dress.

· Awards.

· Page 549Myths and stories told about the organization.

· Published lists of values.

· Observable rituals and ceremonies.

· Special parking spaces.

· Pictures and images handing on walls.

A photo of a toy elephant.Annabelle the Elephant is an artifact of the corporate culture at Kayak.com , provided as a catalyst to make sure employees do not ignore an important but difficult topic, the so-called elephant in the room. Can you think of other artifacts that might prime people to give honest feedback?© photonic 2/Alamy RF

At Facebook, for example, the word hack is pasted all around offices. It symbolizes “the hacker way” of pursuing continuous improvement and challenging the status quo. 12 Kayak.com , an online travel company, uses a two-foot-tall stuffed elephant named Annabelle as an artifact. Annabelle sits in a specially designed conference room reserved for sensitive meetings or discussions. Paul English, cofounder and chief technology officer, created the room because Kayak’s open floor plan does not lend itself to discussions of touchy matters. Annabelle is the “elephant in the room,” the difficult topics discussed there. The company feels Annabelle and the conference room have led to more honest and constructive communications among employees. 13 Artifacts are easier to change than the less visible aspects of organizational culture.

Level 2: Espoused Values

Values were defined in Chapter 2 as abstract ideals that guide our thinking and behavior across all situations. In the context of organizational culture, we distinguish between values that are espoused and values that are enacted.

· Espoused values are the explicitly stated qualities and norms preferred by an organization. They are generally established by the founder of a new or small company and by the top management team in a larger organization. Most companies have a short list. For example, Ikea’s espoused values are humility, willpower, simplicity, togetherness, and enthusiasm. 14 Google and Zappos each have 10 espoused values.

Because espoused values are explicitly communicated to employees, managers hope they will directly influence employee behavior. But people do not always automatically “walk the talk.” Leadership at CVS Health recognized this gap and made a key strategic change to align its stated values with its actions.

EXAMPLE A landmark moment in the company’s transformation came early last year [2014] when [CEO Larry] Merlo announced that CVS would cease selling tobacco products by October 1, 2014—a deadline it met nearly a month early. The decision meant sacrificing about $2 billion in sales. Led by Merlo, CVS’s executive team decided that continuing to sell cigarettes had become untenable for a company that was simultaneously trying to sell itself as a health care giant.15

· Enacted values are the qualities and norms that are exhibited or converted into employee behavior. These are values employees ascribe to an organization based on their observations of what occurs on a daily basis. As at CVS, managers should reduce gaps between espoused and enacted values because they can significantly influence employee attitudes and organizational performance.

A survey from the Ethics Resource Center showed that employees were more likely to behave ethically when management set a good behavioral example and kept its Page 550promises and commitments. 16 This finding was underscored by another study of 129 mergers. Employees were more productive and post-merger performance was higher when employees believed that behavior was consistent with the newly formed firm’s espoused values. 17

Level 3: Basic Underlying Assumptions

Basic underlying assumptions are organizational values so taken for granted over time that they become assumptions guiding organizational behavior. Underlying assumptions are employees’ deep-seated beliefs about their company and are the core of organizational culture. As you might expect, they are highly resistant to change. Consider the way Unilever CEO Paul Polman reinforces a core belief in sustainability (see the OB in Action box).

Sustainability is “a company’s ability to make a profit without sacrificing the resources of its people, the community, and the planet.” 18 Achieving sustainability is sometimes called “being green” and has become a priority for many companies.

OB IN ACTION

Unilever Promotes a Sustainability Culture

A photo of Paul Polman.Paul Polman, CEO of Unilever.© epa european pressphoto agency b.v./Alamy

When Paul Polman took over as CEO of Unilever in 2009, he told Wall Street analysts that the company would no longer provide earnings guidance and quarterly profit statements. This is unheard of! Analysts revolted and the stock price immediately dropped.

What Was Polman Trying to Accomplish? Polman wanted to instill a deep-seated belief regarding sustainability within all employees at Unilever. He started this effort by establishing three key sustainability focus areas: improving health and well-being, reducing environmental impact, and enhancing livelihoods.19 The company also set a goal to “double the size of our business while reducing our environmental footprint and increasing our positive social impact.”20 The company wanted to (1) improve the well-being of 1 billion people by influencing them to wash their hands and brush their teeth and by selling foods with less salt and fat, and (2) improve “the lives of 2 million children and their mothers by 2016 by providing access to health workers, basic nutrition, and life-saving interventions.”21

Unilever also modified its sourcing policies—the requirements for doing business with the company. These now include the following:

1. Business is conducted lawfully and with integrity.

2. Work is conducted on the basis of freely agreed and documented terms of employment.

3. Workers are treated equally and with respect and dignity.

4. All workers are of an appropriate age.

5. Workers’ health and safety are protected.

6. Land rights of communities including indigenous peoples will be protected and promoted.

7. Business is conducted in a manner which embraces sustainability and reduces environmental impact.22

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Polman told investors, “If you don’t buy into this [sustainability], I respect you as a human being, but don’t put your money in our company.” He believes shareholder return should not override nobler goals. He also said, “Our purpose is to have a sustainable business model that is put at the service of the greater good. It’s as simple as that.”23

What Are the Results of Unilever’s Push for a Sustainability Culture? Polman believes employees are now more engaged and the company is a more desirable place to work. The company is making money and contributing to the greater good. According to the Dow Jones Sustainability Report, in “2014 the company enjoyed its fifth consecutive year of top and bottom line growth. Since 2008, the company has reduced costs by EUR 400 million by cutting raw and packaging materials and reducing disposed waste. As of 2014, 33 percent of the company’s food and refreshments products met the highest nutritional standards for their respective product categories, based on globally recognized dietary guidelines, contributing to improved diets for 55 million people.”24

Employees at Unilever say that “doing good is in the company’s DNA.” This is what we call a basic underlying assumption! 25

YOUR THOUGHTS?

1. What do you think was the driving force behind Polman’s desire to create a culture of sustainability?

2. Do you agree with Polman about the tangible business benefits of Unilever’s cultural values? Why or why not?

3. Whether you agree with Polman or not, was he wise to tell investors not to put money in Unilever if they did not also buy into its sustainability plan? Why or why not?

The Four Functions of Organizational Culture

An organization’s culture fulfills four important functions (see Figure 14.3 ):

1. Establish organizational identity.

2. Encourage collective commitment.

3. Ensure social system stability.

4. Act as sense-making device.

FIGURE 14.3 Four functions of organizational cultureA summary graphic of the functions of organizational culture. SOURCE: Adapted from discussion in L. Smircich, “Concepts of Culture and Organizational Analysis,” Administrative Science Quarterly, September 1983, 339–358. Copyright 1983. Reprinted with permission of Sage Publications, Inc.

To help bring these four functions to life, let’s consider how each has taken shape at Southwest Airlines. Southwest has grown to serve more customers domestically than any other airline and has achieved 43 consecutive years of profitability. The company has been on Fortune’s list of Most Admired Companies in the World for 22 consecutive years, and it was named 2015 Airline of the Year by Air Transport World. 26

Function 1: Culture Provides Employees with an Organizational Identity

The identity of Southwest Airlines employees is focused on the belief that employee satisfaction and customer loyalty are more important than corporate profits. Gary Kelly, Southwest’s CEO, highlighted this theme by noting, “Our people are our single greatest strength and our most enduring long-term competitive advantage.” 27

Southwest reinforces this identity by demonstrating in a variety of ways that it truly cares about its employees. The company’s catastrophe fund, for instance, is based on Page 552voluntary contributions for distribution to employees experiencing serious personal difficulties. Its profit-sharing program paid out $620 million in 2016, adding about 15.6 percent to each employee’s compensation.28 Southwest’s people-focused identity also is reinforced by the fact that it is an employer of choice. The company received 371,202 résumés for 6,370 job openings in 2015. It also was rated as providing outstanding opportunities for women and Hispanics by Professional Women magazine and Hispanic magazine, respectively, and the National Conference on Citizenship ranked Southwest as one of The Civic 50 for its use of time, talent, and resources in civic engagement.

Function 2: Culture Facilitates Collective Commitment

The mission of Southwest Airlines is to dedicate itself to “the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.” 29 This commitment to serving others is endorsed by the company’s nearly 49,000 employees. It was rated as providing the best customer service in 2014 by Temkin Experience Ratings, the fourth time it had received the top rating for an airline.30 Southwest also received the lowest ratio of complaints to passengers boarded of all major U.S. airlines, based on statistics accumulated by the Department of Transportation since September 1987. Commitment to service doesn’t just apply to customers at Southwest. Employees volunteered more than 130,000 hours to national and local nonprofit organizations.31

A photo of two Southwest customer service employees in an airport terminal wearing airplane costumes.This photo demonstrates Southwest’s culture. Employees are having fun in an airport terminal to lighten what can be a frustrating experience for passengers. Do you think these employees can lift the spirits of the travelers in the background?© Denver Post/Getty Images

Function 3: Culture Promotes Social System Stability

Social system stability is the extent to which the work environment is perceived as positive and reinforcing, and the extent to which conflict and change are effectively managed. Southwest is noted for its philosophy of having fun, holding parties, and celebrating. For example, staff in each city in which the firm operates are given a budget for parties. The company also uses a variety of performance-based awards and service awards to reinforce employees’ efforts. Its positive and enriching environment is supported by the lowest turnover rates in the airline industry. In 2015 Southwest also was recognized as one of the best places to work in the Glassdoor Employees’ Choice Awards.32

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Function 4: Culture Shapes Behaviors by Helping Members Make Sense of Their Surroundings

Making sense of the surroundings is what helps employees understand why the organization does what it does and how it intends to accomplish its long-term goals. Keeping in mind that Southwest’s leadership originally viewed ground transportation as its main competitor in 1971, employees understand why the airline’s primary vision is to be the best short-haul, low-fare, high-frequency, point-to-point carrier in the United States. Employees know they must achieve exceptional performance, such as turning a plane around in 20 minutes, because they must keep costs down to compete against Greyhound and automobiles. In turn, the company reinforces the value it places on outstanding customer service and high performance by using performance-based awards and profit sharing. Employees own about 13 percent of the company stock. 33