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What is Organizational Culture? - Definition & Characteristics

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Lesson Transcript
Instructor
John McLaughlin
Expert Contributor
George James

George is business executive with an MBA in Management/Finance from Univ. of Cincinnati; and has been an adjunct professor, instructor and lecturer.

In this lesson, you will learn what organizational culture is and how it dictates behavior in organizations. You'll also explore the seven values that define the culture of an organization.

Understanding Organizational Culture

Would you act the same way at a rock concert as you would while watching a symphony orchestra perform? Although there are no written rules that dictate the acceptable way to act at either type of performance, the concert audience will try to make it very clear to you if your behavior does not conform to what they consider to be appropriate.

Would you dress the same way to attend a golf tournament as you would to attend a football game? Although both are sporting events, there are a set of unwritten rules that dictate what is considered to be the acceptable way to dress for each type of event, and the people in attendance will send you signals as to whether or not they think you are dressed appropriately.

At concerts, sporting events, and just about everywhere that people get together, group members convey social expectations by how they dress and act. Newcomers to the group are expected to learn what is acceptable to the group by observing the behavior and dress code of the group members and adapting to the situation accordingly.

Defining Organizational Culture

Organizational culture works a lot like this. Every company has its own unique personality, just like people do. The unique personality of an organization is referred to as its culture. In groups of people who work together, organizational culture is an invisible but powerful force that influences the behavior of the members of that group. So, how do we define organizational culture?

Organizational culture is a system of shared assumptions, values, and beliefs, which governs how people behave in organizations. These shared values have a strong influence on the people in the organization and dictate how they dress, act, and perform their jobs. Every organization develops and maintains a unique culture, which provides guidelines and boundaries for the behavior of the members of the organization. Let's explore what elements make up an organization's culture.

Organizational culture is composed of seven characteristics that range in priority from high to low. Every organization has a distinct value for each of these characteristics, which, when combined, defines the organization's unique culture. Members of organizations make judgments on the value their organization places on these characteristics and then adjust their behavior to match this perceived set of values. Let's examine each of these seven characteristics.

Characteristics of Organizational Culture

The seven characteristics of organizational culture are:

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What Is Organizational Culture? - Definition & Characteristics. Case Study.

You are a new employee at Pharma Big Stuff and after a two-week orientation you are beginning to see 'how the organization works.' Your manager, while nice and polite, is driven by quantitative measures, key performance indicators, statistics, and forecasts. His communication and direction to you are wrapped in this perspective to such an extent that you wonder if he even sees you as a person. Interestingly, he seems to know your team and often refers to individual members as 'team.' Bob, your team is doing great. What is the team doing about this? Has your team put those processes in place?

You look around and discover that many of the departments are driven by accuracy, performance, and results. After all, it is a pharma company. In order to be successful in this field, you must be a fighter who is willing to overcome obstacles within a short window of opportunity. If you don't win, the competition will. The company is constantly coming up with new products that are intended to keep them ahead of the competition.

You have just completed a course on Organizational Culture and learned the seven characteristics that define organizational culture. Taking this new knowledge, how would you rate the distinct value of each characteristic in your company?

Answers:

  • Innovation. A high value is placed on new product innovation. It is the foundation for winning in the marketplace.
  • Attention to detail. The emphasis on measures, performance, and accuracy indicates there is a high value on attention to detail.
  • Emphasis on outcome. While there is constant pressure to get the desired result, there is a strong focus on accuracy and measures. This indicates that the company places a lower value on the outcome. It is the process that will deliver the desired outcome that is important.
  • Emphasis on people. The company does not have a 'personal' connection to its employees, and therefore, emphasis on people is low.
  • Teamwork. The company places a high value on teamwork, to the point that you are likely to be identified as a team member rather than an individual. It is the team that is the focus of the organizational culture.
  • Aggressiveness. The company wants to win in the marketplace and outperform the competition. Thus, the company places a high value on aggressiveness.
  • Stability. The focus on new products and the short window of opportunity available to achieve gold strongly suggest that stability is not a priority.

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