chapter 3
Organizational Culture,
Socialization,
H
I
and Mentoring
G
Learning Objectives
G
S
,
When you finish studying the material in this chapter, you should be able to:
LO.1
LO.2
LO.3
LO.4
A
Define organizational culture and discuss
N its three layers.
G
Discuss the difference between espoused and enacted values.
E
Describe the four functions of organizational
L culture.
Discuss the four types of organizationalAculture associated with the competing values
framework.
3
LO.5
Summarize the five conclusions derived from research about the outcomes associated
0
with organizational culture.
LO.6
Review the four caveats about culture change.
LO.7
LO.8
4
8
Summarize the methods used by organizations
to change organizational culture.
B
U
Describe the three phases in Feldman’s model of organizational socialization.
LO.9
Discuss the various socialization tactics used to socialize employees.
LO.10
Explain the four developmental networks associated with mentoring.
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Would You Like to Work at Southwest Airlines?
Southwest Airline’s Culture permeates every aspect of
our company. It is our essence, our DNA, our past, our
present, and our future. It is so important, in fact, that H
I
wish I had more space to discuss it.
I
We often say that other airlines can copy our business
G
plan from top to bottom but Southwest stands apart
from the clones because of our People. But I would stillG
wager that if another company somehow managed toS
hire all our fantastic Employees, that company wouldn’t
,
match up to Southwest.
Why? The new employer wouldn’t possess the
Southwest Culture, the secret sauce, if you will, of ourA
organization. That Culture motivates and sustains us.N
For many of us, being part of Southwest is not just a
vocation, but a mission. I don’t dictate the Culture;G
neither do our other Officers. Rather, it stems from theE
collective personality of our Employees. It took us moreL
than 30 years just to establish some definitions of our
Culture upon which we could all agree. Those defini-A
tions are laid out in what we call “Living the Southwest
Way.” That creed consists of three values: A Warrior3
Spirit that recognizes courage, hard work, and desire to
be the best; a Servant’s Heart that follows the Golden0
Rule and treats others with respect; and a Fun-LUVing4
Attitude that includes FUN, of course, but also passion
and celebration.
In January, we observed the 18th anniversary of the
founding of our Corporate Culture Committee, a group
dedicated to preserving our Culture for the present and
the future. This Committee stresses that the Southwest
Culture resides in each Employee, no matter the Employee’s title. But the Culture Committee also recognizes how
fragile Culture can be. I’ve talked with some of our Employees who have come to us from other airlines and firms
that, long ago, maintained a strong culture. These Employees often said that they witnessed how a little benign
neglect was able to destroy that culture almost overnight.
Their experiences confirm what I have always believed: Lip service can be a great danger. It’s easy to
write columns like this bragging about our Culture; the
hard work is living up to it every day. Thus, the Committee Members act as examples for all of our other Employees to see. They show that Culture comes from the
heart, not from the memo. As you might imagine, they
have a difficult job, but we are fortunate to have the dedication of these Culture Warriors who battle indifference
and complacency on a daily basis. With their help, our
Culture continues to fly high.1
8
B
U
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The chapter-opening vignette highlights three key conclusions about organizational culture. First, an organization’s culture can impact employee motivation,
satisfaction, and turnover. Southwest is able to maintain low employee turnover
and high job satisfaction by creating a positive, employee-focused culture. The
same can be said about the top five companies to work for in America in 2009
according to Fortune—SAS, Edward Jones, Wegman Food Markets, Google, and
Nugget Market.2 Second, organizational culture can be a source of competitive
advantage. A recent study of 194 retail and service stores confirmed this conclusion. As is true for Southwest Airlines, results showed that market performance
was higher for firms with cultures that showed a joint concern for employees and
customers.3 Finally, managers can influence organizational culture. Southwest
uses its culture committee as a vehicle to shape and reinforce the values desired by
senior management.
This chapter will help you better understand how managers can use organizational culture as a competitive advantage. After defining and discussing the
context of organizational culture,
H we examine (1) the dynamics of organizational
culture, (2) the process of culture change, (3) the organization socialization process,
I
and (4) the embedding of organizational
culture through mentoring.
TO THE POINT
How does organizational
culture influence
organizational outcomes?
G
G
LO.1 Organizational Culture:
S
Definition, and Context
Organizational culture is “the set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and
A 4 This definition highlights three important
reacts to its various environments.”
characteristics of organizational
N culture. First, organizational culture is passed
on to new employees through the process of socialization, a topic discussed later
G
in this chapter. Second, organizational
culture influences our behavior at work.
Finally, organizational cultureE
operates at different levels.
Figure 3–1 provides a conceptual framework for reviewing the widespread
L
impact organizational culture has on organizational behavior. It also shows the
A
linkage between this chapter—culture,
socialization, and mentoring—and other
key topics in this book. Figure 3–1 reveals organizational culture is shaped by four
key components: the founder’s values, the industry and business environment,
3
the national culture, and the senior
leaders’ vision and behavior: The impact of
0
4
figure 3–1 A Conceptual Framework for Understanding
Organizational Culture
8
and
Collective
Organizational
BGroup
Organizational
Organizational
social
attitudes and
Antecedents
structure and
culture
outcomes
processes
behavior
practices
U
• Founder's values
• Industry and
business
environment
• National culture
(Ch. 4)
• Senior leaders'
vision and
behavior
(Ch. 16)
• Observable
artifacts
• Espoused
values
• Basic
assumptions
• Reward
systems
(Ch. 9)
• Organizational
design
(Ch. 17)
• Socialization
• Mentoring
• Decision making
(Ch. 12)
• Group dynamics
(Ch. 10)
• Communication
(Ch. 14)
• Influence and
empowerment
(Ch. 15)
• Leadership
(Ch. 16)
• Work
attitudes
(Ch. 6)
• Job
satisfaction
(Ch. 6)
• Motivation
(Ch. 8)
• Effectiveness
(Ch. 17)
• Stress
(Ch. 18)
SOURCE: From C Ostroff, A Kinicki, and M Tamkins, “Organizational Culture and Climate,” Handbook of Psychology, vol 12, edited by Walter C Borman,
Daniel R Ilgen, Richard J Klimoski, and Irving B Weiner, pp 565–93, Copyright © 2003. Reprinted with permission of John Wiley & Sons.
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Chapter Three
Organizational Culture, Socialization, and Mentoring
63
national culture on organizational behavior is discussed in detail in Chapter 4.
In turn, organizational culture influences the type of organizational structure
adopted by a company and a host of practices, policies, and procedures implemented in pursuit of organizational goals. These organizational characteristics
then affect a variety of group and social processes. This sequence ultimately affects employees’ attitudes and behavior and a variety of organizational outcomes.
All told, Figure 3–1 reveals that organizational culture is a contextual variable
influencing individual, group, and organizational behavior. This is why we are discussing organizational culture as the third chapter in your textbook.
Dynamics of Organizational Culture
To gain a better understanding of how organizational culture is formed and used
by employees, this section begins by discussing the layers of organizational culture. We then review the four functions of organizational culture, types of organiH
zational culture, and outcomes associated with organizational culture.
I
Layers of Organizational CultureG
G
Figure 3–1 shows the three fundamental layers of organizational
culture: observable artifacts, espoused values, and basic assumptions.
Each
level
varies in terms
S
of outward visibility and resistance to change, and each level influences another
,
level.
Observable Artifacts At the more visible level,
A culture represents observable artifacts. Artifacts consist of the physical manifestation of an organization’s
N manner of dress, awards,
culture. Organizational examples include acronyms,
myths and stories told about the organization, published
lists of values, observG
able rituals and ceremonies, special parking spaces, decorations, and so on. For
example, the Ritz-Carlton hotel uses storytelling toEreinforce a culture that is focused on exceeding customers’ expectations. The company
shares “wow stories”
L
at meetings each week that relay guests’ tales of staff members going above and
beyond the call of duty. Each “wow” winner, suchAas a laundry attendant who
dove into a dumpster to retrieve one young guest’s stuffed gingerbread man, gets
$100.5 This level also includes visible behaviors exhibited by people and groups. At
3
Google, for example, the core design team of 16 employees
have daily “stand-up”
meetings. “Everyone working on the project gathers
0 standing up, to make sure6
no one gets too comfortable and no time is wasted during the rapid-fire update.”
4 desire to work hard and get
These stand-up meetings are an artifact of Google’s
things done in a timely manner. Artifacts are easier 8
to change than the less visible
aspects of organizational culture.
TO THE POINT
What are the key
conclusions regarding
layers of culture,
functions of culture,
types of culture, and
outcomes associated
with organizational
culture?
Go to
www.mcgrawhillconnect.com
for an interactive exercise to
test your knowledge of the
conceptual framework.
B
LO.2 Espoused Values Values possess U
five key components. “Values
(1) are concepts or beliefs, (2) pertain to desirable end-states or behaviors, (3) transcend situations, (4) guide selection or evaluation of behavior and
events, and (5) are ordered by relative importance.”7 It is important to distinguish
between values that are espoused versus those that are enacted.
Espoused values represent the explicitly stated values and norms that are 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.
organizational culture Shared
values and beliefs that underlie a
company’s identity.
kre29368_ch03_060-087.indd 63
values Enduring belief in a mode
of conduct or end-state.
espoused values The stated values and norms that are preferred
by an organization.
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real WORLD // real PEOPLE: ethics
Williams-Sonoma’s Espoused Values Focus on Employees, Customers,
Shareholders, and Ethical Behavior
People First We believe the potential of our
company has no limit and is driven by our associates
and their imagination. We are committed to an
environment that attracts, motivates and recognizes
high performance.
Customers We are here to please our customers—
without them nothing else matters.
Quality We must take pride in everything we do.
From our people, to our products and in our relationships with business partners and our community, quality
is our signature.
Shareholders We must provide a superior return
to our shareholders. It’s everyone’s job.
Ethical Sourcing Williams-Sonoma, Inc., and
all of its brands are committed to maintaining the highest level of integrity and honesty throughout all aspects
of our business. We work to ensure that our business
associates, including agents, vendors and suppliers,
share our commitment to socially responsible employment conditions.
Wood Product Sourcing Williams-Sonoma,
Inc., is committed to environmental stewardship, and
more specifically, to responsible wood sourcing to protect and conserve this vital natural resource integral to
the health of the environment and the communities from
which we source.
H Procurement Policy Equally important
Paper
toI Williams-Sonoma, Inc.’s commitment to responsible
wood sourcing, is our commitment to sound paper proG
curement practices that also ensure the sustainability of
G and other natural resources.
forests
Swhat extent are these values consistent with
To
your
, own values? Would you like to work at
Williams-Sonoma?
SOURCE: Excerpted from “Corporate Values,” www
.williams-sonomainc.com/careers/corporate-values.html,
accessed January 2, 2011.
A
N
G
E
Consider, for example, the espoused
L values of Williams-Sonoma (see Real World/
Real People above). This specialty retailer of home furnishings was founded in
A
1956 and has experienced substantial
growth since its inception.
On a positive note, Williams-Sonoma and many more companies are espousing
the value of sustainability. Sustainability represents “a company’s ability to make
a profit without sacrificing the3 resources of its people, the community, and the
planet.”
0 8 Sustainability also is referred to as “being
green,” and Pulitzer Prize winner Thomas Friedman
4
believes that “outgreening” other nations can renew
8
America
and defeat al-Qaeda.9 Others believe that
outgreening can produce a competitive advantage
B
for organizations. For example, insurer Safeco and
U
Microsoft
have significantly cut costs and increased
productivity by implementing employer-subsidized
transportation that reinforces the idea that people be
encouraged not to drive to work.
Because espoused values represent aspirations
that are explicitly communicated to employees, managers hope that those values will directly influence
employee behavior. Unfortunately, aspirations do
not automatically produce the desired behaviors because people do not always “walk the talk.” BP, for
instance, has long claimed that it values safety, yet
The Deepwater Horizon spill was one of the worst environmental
the company had a refinery fire in Texas City, Texas,
disasters in U.S. history. This worker is using a vacuum hose to
that killed 15 people in 2005, a 2006 pipeline leak in
collect oil that washed on shore in the Gulf of Mexico. The oil spill
damaged marine and wildlife habitats and cost billions to cleanup. Alaska that lost over 200,000 gallons of crude, and
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Chapter Three
Organizational Culture, Socialization, and Mentoring
65
the 2010 Deepwater Horizon spill in the Gulf lost more than 200 million gallons
according to the U.S. government.10
Enacted values, on the other hand, represent the values and norms that actually
are exhibited or converted into employee behavior. They represent the values that
employees ascribe to an organization based on their observations of what occurs on
a daily basis. For example, Starbucks CEO, Howard Schultz, is trying hard to enact
the company value of providing quality products and great service in response to
the financial problems faced by the company in 2009. He told an interviewer in
2010 that “I shut our stores for three and a half hours of retraining. People said,
‘How much is that going to cost?’ I had shareholders calling me and saying, ‘Are
you out of your mind?’ I said, ‘I’m doing the right thing. We are retraining our
people because we have forgotten what we stand for, and that is the pursuit of an
unequivocal, absolute commitment to quality.’”11 Schultz is obviously hoping that
these artifacts encourage employees to provide good service.
It is important for managers to reduce gaps between espoused and enacted values because they can significantly influence employee
Hattitudes and organizational
performance. For example, a survey administered by the Ethics Resource Center
I
showed that employees were more likely to behave ethically
when management behaved in a way that set a good ethical example and G
kept its promises and commitments. This finding is underscored by another recent study of 500,000 employees
G
from more than 85 countries. Results revealed that companies
experienced 10 times
more misconduct when they had weak rather than strong
S ethical cultures.12 Managers clearly need to walk the talk when it comes to behaving ethically.
,
Basic Assumptions Basic underlying assumptions are unobservable and
represent the core of organizational culture. They constitute
organizational values
A
that have become so taken for granted over time that they become assumptions that
N
guide organizational behavior. They thus are highly resistant
to change. When basic
assumptions are widely held among employees, people
will
fi
nd behavior based on
G
an inconsistent value inconceivable. Southwest Airlines, for example, is noted for
operating according to basic assumptions that value E
employees’ welfare and providing high-quality service. Employees at Southwest Airlines
L would be shocked to see
management act in ways that did not value employees’ and customers’ needs.
A
Go to
www.mcgrawhillconnect.com
for a self-assessment to learn
what your preferred corporate
culture type is.
Back to the Chapter-Opening Case3
0
What observable artifacts, espoused values, and basic assumptions are displayed in
4
the case?
8
B
What Are the Takeaways from Research on Levels of CulU
ture? The key takeaway involves the consequences of what is called PE fit.
PE fit is defined “as the compatibility between an individual and a work environment that occurs when their characteristics are well matched.”13 Results
from a meta-analysis of over 170 studies and 40,000 workers demonstrated that
people have higher job satisfaction and commitment to their organizations and
lower intentions to quit when their personal characteristics (e.g., skills, abilities,
and personalities) and values (e.g., integrity) match or fit the job requirements,
sustainability Meeting humanity’s needs without harming future
generations.
kre29368_ch03_060-087.indd 65
Enacted values The values
and norms that are exhibited by
employees.
PE Fit Extent to which personal
characteristics match those from a
work environment.
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real WORLD // real PEOPLE
Lack of PE Fit Leads Apple Employee to Leave the Company
The Apple Inc. executive in charge of the iPhone has left
the company following a string of stumbles with the device, and what people familiar with the situation said was
a falling out with then Chief Executive Steve Jobs. . . .
Several people familiar with Mr. Papermaster’s situation said his departure was driven by a broader cultural
incompatibility with the company.
Mr. Papermaster had lost the confidence of Mr. Jobs
months ago and hasn’t been part of the decisionmaking process for some time, these people said. They
added that Mr. Papermaster didn’t appear to have the
type of creative thinking expected at Apple and wasn’t
used to Apple’s corporate culture, where even senior
executives are expected to keep on top of the smallest
details of their areas of responsibility and often have to
handle many tasks directly, as opposed to delegating
them.
What could Mr. Papermaster have done to increase his PE fit?
SOURCE: Excerpted from Y I Kane and I Sherr, “IPhone Executive
Is Out at Apple,” The Wall Street Journal, August 9, 2010, p B1.
H
I
G
organizational values, and the values of the workgroup.14 These results highG
light that PE fit is important for your future job and career satisfaction. As a
S Apple’s former senior vice president for mobile
case in point, Mark Papermaster,
devices, left the company partly
, because of low PE fit (see Real World/Real
People above).
You may be wondering how to determine PE fit prior to accepting a job or promotion. It can be done, but it takes
A some work on your part. You first must conduct
an evaluation of your strengths, weaknesses, and values. Next, do the same for the
N by doing research about the company on the Incompany or department at hand
ternet or talking with current employees.
This information will now enable you to
G
prepare a set of diagnostic questions to ask during the interview process. These quesE your level of fit. For example, if you value recogtions need to focus on determining
nition for hard work, then askL
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 PE fit A
and will not be happy working at this company.
Some companies understand the importance of PE fit and have designed methods within the recruiting process to encourage its accomplishment. Consider the
3
selection process used by ReThink Rewards, a Toronto-based company, when hir0
ing salespeople.
4
8 group interviews, each with 10 candidates and
Example. The process includes
two employees—a sales representative and a human resource representative. The
B
interviewers then select 10 finalist candidates and ask each to review one of the
Ua 20-minute PowerPoint presentation to two other
company’s case studies and give
employees. The presentations are followed by 10-minute question-and-answer
sessions. Finalists are interviewed by the hiring manager and HR representative,
who use “Topgrading” methods—an approach that involves an extensive interview with each candidate about his or her experiences in high school, college
and the workplace. . . . During the Topgrading interview, the candidate is asked
15 questions about each job he or she has held in the past 10 years, including
opportunities, challenges, mistakes and accomplishments.15
LO.3
Four Functions of Organizational Culture
As illustrated in Figure 3–2, an organization’s culture fulfills four functions. To
help bring these four functions to life, let us consider how each of them has taken
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Chapter Three
figure 3–2
Organizational Culture, Socialization, and Mentoring
67
Four Functions of Organizational Culture
Organizational
identity
Sense-making
device
Collective
commitment
Organizational
culture
Social system
stability
H
I
G
G
S
,
A
N
G
shape at Southwest Airlines. Southwest is a particularly instructive example beE
cause it has grown to become the largest carrier in the United States based on
L has achieved 38 consecutive
scheduled departures since its inception in 1971 and
years of profitability. Fortune has ranked Southwest in the top five of the Best
A
Companies to Work For in America from 1997 to 2000; Southwest has chosen not
SOURCE: Adapted from discussion in L Smircich, “Concepts of Culture and Organizational Analysis,”
Administrative Science Quarterly, September 1983, pp 339–58. Reprinted with permission.
to participate in this ranking process since 2000. Southwest also was ranked as one
16
of the Top 50 Companies committed to corporate social
3 responsibility in 2010.
1. Give members an organizational identity. Southwest
Airlines is known as a
0
fun place to work that values employee satisfaction and customer loyalty
over corporate profits. Gary Kelly, Southwest’s4CEO, highlighted this theme
by noting that “our people are our single greatest
8 strength and our most enduring long-term competitive advantage. ”17
The company also has a catastrophe fund B
based on voluntary contributions for distribution to employees who are U
experiencing serious personal
difficulties. Southwest’s people-focused identity is reinforced by the fact that
it is an employer of choice. For example, Southwest received 90,043 résumés
and hired 831 new employees in 2009. The company also was rated as providing outstanding opportunities for women and Hispanics by Professional
Women magazine and Hispanic magazine, respectively, and Business Ethics
ranked Southwest among the 100 Best Corporate Citizens seven years in
a row.
2. Facilitate collective commitment. The mission of Southwest Airlines “is dedication to the highest quality of Customer Service delivered with a sense of
warmth, friendliness, individual pride, and Company Spirit.”18 Southwest’s
nearly 35,000 employees are committed to this mission. The Department
of Transportation’s Air Travel Consumer Report reported Southwest was
ranked number one in fewest customer complaints since 1987.
kre29368_ch03_060-087.indd 67
Go to
www.mcgrawhillconnect.com
for a video case on the
organizational culture at Pike
Place Fish Market.
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Part One
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3. Promote social system stability. Social system stability reflects 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, having parties, and celebrating. For example, each city in
which the firm operates is given a budget for parties. Southwest
also uses a variety of performance-based awards and service
awards to reinforce employees. The company’s positive and enriching environment is supported by the lowest turnover rates in the
airline industry and the employment of 1,164 married couples.
4. Shape behavior by helping members make sense of their surroundThe smile on this Southwest Airlines
ings. This function of culture helps employees understand why
employee demonstrates the four functions
the organization does what it does and how it intends to accomof culture. Southwest employees have high
plish its long-term goals. Keeping in mind that Southwest’s leadjob satisfaction and low employee turnover,
ership originally viewed ground transportation as their main
in part attributable to its philosophy of having
competitor inH1971, employees come to understand why the airfun and celebrating. Would you like to work at
line’s primary
Southwest?
I vision is to be the best primarily short-haul, lowfare, high-frequency, point-to-point carrier in the United States.
G must achieve exceptional performance, such as
Employees understand they
turning a plane in 20 minutes,
G because they must keep costs down in order to
compete against Greyhound and the use of automobiles. In turn, the comS
pany reinforces the importance
of outstanding customer service and high
performance expectations
, by using performance-based awards and profit
sharing. Employees own about 5% of the company stock.
LO.4
A
Types of Organizational
Culture
N
Organizational behavior researchers have proposed three different frameworks
G
to capture the various types of organizational culture: the organizational culture
E framework, and the organizational culture proinventory, the competing values
file. This section discusses the L
competing values framework because it is the most
widely used approach for classifying organizational culture. It also was named as
one of the 40 most importantA
frameworks in the study of organizations and has
been shown to be a valid approach for classifying organizational culture.19
The competing values framework (CVF) provides a practical way for manag3 change organizational culture. It was originally
ers to understand, measure, and
developed by a team of researchers
0 who were trying to classify different ways to
assess organizational effectiveness. This research showed that measures of orga4 two fundamental dimensions or axes. One axis
nizational effectiveness vary along
pertains to whether an organization
focuses its attention and efforts on internal
8
dynamics and employees or outward toward its external environment and its customers and shareholders. The B
second is concerned with an organization’s preference for flexibility and discretion
U or control and stability. Combining these two
axes creates four types of organizational culture that are based on different core
values and different sets of criteria for accessing organizational effectiveness. The
CVF is shown in Figure 3–3.20
Figure 3–3 shows the strategic thrust associated with each cultural type along
with the means used to accomplish this thrust and the resulting ends or goals
pursued by each cultural type. Before beginning our exploration of the CVF, it is
important to note that organizations can possess characteristics associated with
each culture type. That said, however, organizations tend to have one type of culture that is more dominant than the others. Let us begin our discussion of culture
types by starting in the upper-left-hand quadrant of the CVF.
Clan Culture A clan culture has an internal focus and values flexibility
rather than stability and control. It resembles a family-type organization in which
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Chapter Three
figure 3–3
Organizational Culture, Socialization, and Mentoring
69
Competing Values Framework
Flexibility and discretion
Clan
Internal focus
and integration
Adhocracy
Thrust: Collaborate
Thrust: Create
Means: Cohesion, participation,
communication, empowerment
Means: Adaptability, creativity,
agility
Ends: Morale, people
development, commitment
Ends: Innovation, growth,
cutting-edge output
Hierarchy
Market
Thrust: Control
External focus and
differentiation
Thrust: Compete
H
Means: Capable processes,
Means: Customer focus, productivity,
consistency, process control, I enhancing competitiveness
measurement
G
Ends: Efficiency, timeliness,
Market share, profitability, goal
G Ends:
smooth functioning
achievement
S
Stability and control
,
SOURCE: Adapted from K S Cameron, R E Quinn, J Degraff, and A V Thakor, Competing Values Leadership (Northampton, MA: Edward Elgar,
2006), p 32.
A
effectiveness is achieved by encouraging collaboration between employees. This
N
type of culture is very “employee-focused” and strives to instill cohesion through
G employee involvement.
consensus and job satisfaction and commitment through
Clan organizations devote considerable resources
E to hiring and developing
their employees, and they view customers as partners.
L
A company with a strong clan culture is Decagon
Devices in Pullman,
Washington. The company may be small, but senior
management
tries to mainA
tain a family atmosphere at work. The company’s CEO, Tamsin Jolley, noted that
“the way that we like to see it is that as we add employees we’re just adding members to the family.” This feeling starts with a profit-sharing
program that distrib3
utes 20% of pretax profits to employees on a quarterly basis.
0
4
Example. Then there are day-to-day activities that bring workers closer together.
8 home-cooked meals to work
Each Wednesday, some employees take turns bringing
for their colleagues. Then, all the workers eat lunchBtogether. The weekly meal is
an opportunity for managers to share news about the company, introduce new
U financial statements. The
employees, and teach workers how to read the company’s
Go to
www.mcgrawhillconnect.com
for an interactive exercise to
test your knowledge of the
competing values framework.
company also encourages employees to socialize at work. The office has a pingpong table and slot-car track, and there’s a long tradition of employees playing
soccer on their breaks.21
Decagon Devices also provides generous employee health benefits and hosts
annual catered family picnics and holiday parties.
competing values framework
(CVF) A framework for categorizing
organizational culture.
kre29368_ch03_060-087.indd 69
clan culture A culture that has an
internal focus and values flexibility
rather than stability and control.
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SAS, rated as the number one best company to work for in America in 2009
by Fortune, as well as Zappos and Discount Tire represent other good examples
of successful companies with clan cultures.22 Zappos, for example, encourages
managers to spend up to 20% of their spare time engaging in teambuilding outside of work.23
Adhocracy Culture An adhocracy culture has an external focus and values
flexibility. This type of culture fosters the creation of innovative products and
services by being adaptable, creative, and fast to respond to changes in the marketplace. Adhocracy cultures do not rely on the type of centralized power and
authority relationships that are part of market and hierarchical cultures. They
empower and encourage employees to take risks, think outside the box, and experiment with new ways of getting things done. This type of culture is well suited
for start-up companies, those in industries undergoing constant change, and those
in mature industries that are in need of innovation to enhance growth. Consider
H are reinforced at the biopharmaceutical firm
how these cultural characteristics
AstraZeneca. “AstraZeneca is Iexperimenting with new ways to organize research
to improve productivity. Scientists now are responsible for candidate drugs until
G ending a culture of handing off early-stage prodthey begin the final human trials,
ucts to other researchers as ifGon an assembly line.”24 India-based Tata group,
with over 90 operating companies in more than 80 countries is another company
S
with an adhocracy culture. “Known
for its ultracheap minicar, the Nano, Tata
takes innovation so seriously that
, it’s developed an ‘Innometer.’ The conglomerate measures creative goals and accomplishments vs. domestic or global benchmarks while instilling a ‘sense of urgency’ among employees.”25 Tata was ranked
as the 17th most innovative firm
A in the world in 2010 by Bloomberg Businessweek.
W. L. Gore, Intel, and Google are other companies that possess cultural characN
teristics consistent with an adhocracy.
G
Market Culture A market
Eculture has a strong external focus and values stability and control. Organizations with this culture are driven by competition and a
strong desire to deliver results L
and accomplish goals. Because this type of culture
is focused on the external environment,
customers and profits take precedence
A
over employee development and satisfaction. The major goal of managers is to
drive toward productivity, profits, and customer satisfaction. Consider Richard
Branson’s new Virgin America3airline. Branson believes that “American carriers
are all very much the same, and
0 the people who run them do not think of the
customers at all.” “It’s become a bus service.” To meet customer needs, Branson’s
4 A320 jets that are roomier, contain in-flight ennew airline uses Airbus A319 and
tertainment at every seat, Wi-Fi
8 Internet access, and special lighting that displays
12 shades of pink, purple, and blue.26 Time will tell whether this market culture
will lead to sustainable profits.B
Employees in market cultures
U also are expected to react fast, work hard, and
deliver quality work on time. Organizations with this culture tend to reward people
who deliver results. Byung Mo Ahn, president of Kia Motors, is a good example
of a leader who desires to promote a market culture. He fired two senior executives from Kia Motors America in February 2008 because they were not meeting
their expected sales goals. Employees from North America note that Mr. Ahn has
created a very aggressive and competitive work environment. Some describe the
environment as militaristic.27
Hierarchy Culture Control is the driving force within a hierarchy culture.
The hierarchy culture has an internal focus, which produces a more formalized and
structured work environment, and values stability and control over flexibility. This
orientation leads to the development of reliable internal processes, extensive measurement, and the implementation of a variety of control mechanisms. Effectiveness in a company with this type of culture is likely to be assessed with measures
kre29368_ch03_060-087.indd 70
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71
of efficiency, timeliness, quality, safety, and reliability of producing and delivering
products and services. Johnson & Johnson (J&J) is a good example of why some
organizations desire a hierarchical culture. J&J had serious manufacturing problems in 2010 that led to recalls of children’s Tylenol and other over-the-counter
drugs. “A Food and Drug Administration inspection report, dated April 30, cites
incidents of mishandling of materials, lax documentation and inadequate investigation of consumer complaints.” The company estimates a loss of $600 million
in 2010 and a hit to its reputation. To correct the problem, the company created
“a company-wide quality team and is upgrading plants,” improving plants, and
training employees.28 Time will tell if a focus on creating a hierarchical culture in
its manufacturing operations will correct J&J’s problems.
Back to the Chapter-Opening Case
How would you categorize Southwest Airline’s Culture H
based on the competing values
framework?
I
G
G
Cultural Types Represent Competing Values
It is important to note
that certain cultural types reflect opposing core values.
S These contradicting cultures are found along the two diagonals in Figure 3–3. For example, the clan
,
culture—upper-left quadrant—is represented by values that emphasize an internal
focus and flexibility, whereas the market culture—bottom-right quadrant—has an
external focus and concern for stability and control. You can see the same conflict
A
between an adhocracy culture that values flexibility and an external focus and a
hierarchy culture that endorses stability and controlNalong with an internal focus.
Why are these contradictions important?
G
They are important because an organization’s success may depend on its ability
E cultural types. While this
to possess core values that are associated with competing
is difficult to pull off, it can be done. 3M is a good example.
The company is trying
L
to merge competing cultural characteristics from an adhocracy with those from
A
a hierarchy. Reflecting an adhocracy culture, 3M released
1,000 new products in
2009, and it “awards annual Genesis Grants, worth as much as $100,000, to company scientists for research. The money is allocated
3
by their peers and is spent on projects for which ‘no
sensible, conventional person in the company would
0
give money,’ ” says Chris Holmes, a 3M division vice
4
president. The company has a goal to generate 30%
of its revenue from products developed in the last five
8
years. In contrast, 3M pursued a hierarchical culture
B
by implementing quality management techniques
U
to reduce waste and defects and increase efficiency.
Although 3M achieved better efficiency and earnings
in the short run, new product revenue decreased and
scientists complained that the quality initiatives were
choking off innovation. One engineer quipped that
“it’s really tough to schedule invention.” 3M’s CEO,
George Buckley, was made aware of these cultural 3M is one of the most innnovative firms in the world. Even
conflicts and decided to reduce the conflict within com- during the recent recession, the company released over
pany labs by decreasing hierarchical policies/procedures 1,000 new products in one year.
adhocracy culture A culture that
has an external focus and values
flexibility.
kre29368_ch03_060-087.indd 71
market culture A culture that has
a strong external focus and values
stability and control.
hierarchy culture A culture that
has an internal focus and values
stability and control over flexibility.
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while simultaneously increasing those related to adhocracy. The company continues to emphasize quality and reliability in its factories. To date, results indicate a
successful transition as the company achieved both its efficiency and new product
revenue goals in 2010.29
LO.5
Outcomes Associated
with Organizational Culture
Both managers and academic researchers believe that organizational culture can
be a driver of employee attitudes, performance, and organizational effectiveness.
To test this possibility, various measures of organizational culture have been correlated with a variety of individual and organizational outcomes. So what have we
learned? A team of researchers recently conducted a meta-analysis to answer this
question. Their results were based on 93 studies involving over 1,100 companies.
Figure 3–4 summarizes results from this study.30
H of relationships between eight different organiFigure 3–4 shows the strength
zational outcomes and the culture
I types of clan, adhocracy, and market: Hierarchy was not included due to a lack of research on this type. Results reveal that the
G
eight types of organizational outcomes
had significant and positive relationships
with clan, adhocracy, and market
cultures.
The majority of these relationships
G
were of moderate strength, indicating that they are important to today’s managS
ers. Closer examination of Figure 3–4 leads to the following five conclusions:
,
1. Organizational culture is clearly related to measures of organizational effectiveness. This reinforces the conclusion that an organization’s culture can be
a source of competitive advantage.
A
2. Employees are more satisfied and committed to organizations with clan culN that employees prefer to work in organizations
tures. These results suggest
G
E
figure 3–4 Correlates ofL Organizational Culture
A
Job satisfaction
Variables
Organizational
commitment
Subjective
innovation
Quality of products
and services
Subjective profit
Subjective growth
3
0
4
8
B
U
Objective profit
Objective growth
Not significant
Clan
Weak
Moderate
Strength of relationship
Adhocracy
Strong
Market
SOURCE: Data for this Figure were obtained from C A Hartnell, A Y Ou, and A J Kinicki, “Organizational
Culture and Organizational Effectiveness: A Meta-Analytic Investigation of the Competing Values Framework’s
Theoretical Suppositions,” Journal of Applied Psychology, July 2011, pp 677–694.
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73
that value flexibility over stability and control and those that are more
concerned with satisfying employees’ needs than customer or shareholder
desires.
3. Innovation and quality can be increased by building characteristics associated with clan, adhocracy, and market cultures into the organization.
4. An organization’s financial performance (i.e., growth in profit and growth
in revenue) is not very strongly related to organizational culture. Managers
should not expect to increase financial performance by trying to change their
organization’s culture.
5. Companies with market cultures tend to have more positive organizational
outcomes. Managers are encouraged to consider how they might make their
cultures more market oriented.
Researchers also have investigated the importance of organizational culture within
the context of a merger. These studies indicate that mergers frequently failed due to
Hof corporate mergers around
incompatible cultures. Owing to the increasing number
the world, and the conclusion that 7 out of 10 mergersI and acquisitions failed to meet
their financial promise, managers within merged companies would be well advised to
consider the role of organizational culture in creating G
a new organization.31
In summary, research underscores the significance
Gof organizational culture. It
also reinforces the need to learn more about the process of cultivating and changS is not determined by fate.
ing an organization’s culture. An organization’s culture
It is formed and shaped by the combination and ,integration of everyone who
works in the organization. A change-resistant culture, for instance, can undermine
the effectiveness of any type of organizational change. Although it is not an easy
task to change an organization’s culture, the next section
provides a preliminary
A
overview of how to create cultural change.
N
G
LO.6 The Process of Culture
Change
E
Before describing the specific ways in which managers
L can change organizational
culture, let us review four caveats about culture change. First, we agree with the
notion that leaders are the architects and developersA
of organizational culture, and
managing organizational culture is one of the most important functions of leadership.32 Second, the process of culture change essentially begins with targeting
3
one of the three layers of organizational culture previously
discussed—observable
artifacts, espoused values, and basic assumptions.0 That said, culture will not
change in a significant way unless managers are able to change basic underlying
4
assumptions.33 Third, it is important to consider the extent to which the current
culture is aligned with the organization’s vision and8strategic plan before attempting to change any aspect of organizational culture. A vision represents a long-term
B
goal that describes “what” an organization wants to become. For example, Walt
Disney’s original vision for Disneyland included theUfollowing components:
TO THE POINT
What are the specific
methods or techniques
managers can use to
change an organization’s
culture?
Example. Disneyland will be something of a fair, an exhibition, a playground, a
community center, a museum of living facts, and a showplace of beauty and magic.
It will be filled with the accomplishments, the joys and hopes of the world we live
in. And it will remind and show us how to make those wonders part of our lives.34
vision Long-term goal describing
“what” an organization wants to
become.
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A strategic plan outlines an organization’s long-term goals and the actions necessary to achieve these goals. Mark Fields, executive vice president, Ford Motor
Company, and president, The Americas, firmly believes that culture, vision, and
strategic plans should be aligned. According to Fields, “Culture eats strategy for
breakfast. You can have the best plan in the world, and if the culture isn’t going to
let it happen, it’s going to die on the vine.”35
Finally, it is important to use a structured approach when implementing culture change. Chapter 18 can help you in this regard as it presents several models
that provide specific steps to follow when implementing any type of organizational
change. Let us now consider the specific methods or techniques that managers can
use to change an organization’s culture.
LO.7 Edgar Schein, a well-known OB scholar, notes that changing organizational
culture involves a teaching process. That is, organizational members teach each
other about the organization’s preferred values, beliefs, norms, expectations,
and behaviors. This is accomplished
by using one or more of the following
H
mechanisms:36
I
1. Formal statements of organizational
philosophy, mission, vision, values, and
G
materials used for recruiting, selection, and socialization. Sam Walton, the
G
founder of Walmart, established
three basic beliefs or values that represent
the core of the organization’s
S culture. They are (a) respect for the individual,
(b) service to our customer, and (c) striving for excellence. Further, Nucor
,
Corporation attempts to emphasize the value it places on its people by
2.
3.
4.
5.
kre29368_ch03_060-087.indd 74
including every employee’s name on the cover of the annual report. This
practice also reinforces the
A clan type of culture the company wants to encourage.37 Would you like to work at Nucor?
N work environments, and buildings. Novartis AG
The design of physical space,
in Basel, Switzerland, designed
its offices to foster collaboration. This was
G
done by using “common workspaces, sofas, soft lighting and cappuccino
E
machines to encourage people to talk, share ideas and build relationships.”
L for employees so that they would not be tied
They also invested in laptops
down to cubicles.38
A
Slogans, language, acronyms, and sayings. For example, Robert Mittelstaedt,
dean of the W. P. Carey School of Business at Arizona State University,
promotes his vision of having
3 one of the best business schools in the world
through the slogan “Top-of-mind business school.” Employees are encour0 that promote the quality and reputation of the
aged to engage in activities
school’s academic programs.
4
Deliberate role modeling,
8 training programs, teaching, and coaching by
managers and supervisors. Fluor Corporation, one of the leading design,
B firms in the world, desires an ethical culture
engineering, and contracting
that fights corruption within
the construction industry. The company,
U
which derives more than half of its $17 billion in revenues overseas, puts
all its employees through online anticorruption training sessions and
teaches specialized workers, such as field operators, in person. Executives promote an open-door policy and a hotline for reporting crimes—
as well as tough penalties for violators, who receive zero tolerance for
infractions.39
Explicit rewards, status symbols (e.g., titles), and promotion criteria. At Triage
Consulting Group, employees at the same level of their career earn the same
pay, but employees are eligible for merit bonuses, reinforcing the culture of
achievement. The merit bonuses are partly based on coworkers’ votes for
who contributed most to the company’s success, and the employees who
received the most votes are recognized each year at the company’s “State of
Triage” meeting.40
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75
6. Stories, legends, or myths about key people and events. Baptist Health Care
uses a combination of storytelling and recognition to embed clan- and
market-based cultures that focus on employees and patients.
Example. We’ve been able to do more and different things because of our
culture, which starts with the executives who carry it to the front-line and
staff,” says BHC Director of People Development Scott Ginnette. . . . For
example, throughout the year we celebrate Champions, people who have
done extraordinary things in service, by sharing their stories with all employees. Every facility has its own Champions, and at the end of the year, a committee decides which Champions will be named Legends, a higher honor.
The Legends are taken by limo to an offsite dinner with board members
where stories are shared and the Legends are recognized.41
H
Marriott also uses stories to reinforce its culture. For example, Ed Fuller,
I
head of international lodging for Marriott International, teaches employees
Gthe story of how he and anabout fairness in career advancement by telling
other senior executive started their careers as aG
security guard and a waiter.42
Managers can develop and tell motivating stories by noticing relevant actions and tying them to values. Good storiesS
also can come from listening
to customers. It is important when telling stories
, that you are factual and
authentic because someone may check out the story.
7. The organizational activities, processes, or outcomes that leaders pay attenA took over as chief execution to, measure, and control. When Ron Sargent
tive of Staples, he wanted to increase the focus on customer service. He
N
started by investigating what values the office supply retailer’s employees
G helping others. Sargent
already held, and they told him they cared about
used that value as the basis for developing their
E skill in serving customers.
Staples began teaching employees more about the products they sell and
L also pays frequent visits
now offers bonuses for team performance. Sargent
to stores so he can talk directly to employees about
A what customers like and
dislike.43
8. Leader reactions to critical incidents and organizational crises. BP’s new CEO
3 quickly to criticism that the
after the Gulf oil spill—Bob Dudley—responded
company valued profit and efficiency more than
0 safety. He sent a memo to
all employees indicating “that safety would be the sole criterion for reward4 for the fourth quarter.”44
ing employee performance in its operating business
These types of rewards will need to be offered long
8 term if the company truly
wants to change employees’ basic underlying assumptions.
B
9. The workflow and organizational structure. Hierarchical structures are more
likely to embed an orientation toward controlUand authority than a flatter
organization. This partly explains why leaders from many organizations are
increasingly reducing the number of organizational layers in an attempt to
empower employees (see Chapter 17) and increase employee involvement.
Novartis AG is a prime example. The company changed its organizational
structure to foster the creativity and productivity associated with adhocracy and market cultures. “Leaders are seeing results from cross-functional
strategic plan A long term plan
outlining actions needed to achieve
desired results.
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real WORLD // real PEOPLE
Zappos Works Hard to Recruit and Select People Who Fit Its Culture
Here is what Rebecca Ratner, Zappos HR director, had
to say about the company’s approach to recruitment and
selection. “We spend seven to 10 hours over four occasions at happy hours, team building events, or other
things outside the office. We can see them, and they
can us.” The process seems to be good for retention. “In
2009, we had a 20 percent turnover rate,” says Ratner.
That is impressive for call centers. What keeps people
at Zappos? “We pay 100 percent of employee benefits,” . . . and then there’s the wow factor.
“We can’t ask people to wow a customer if they
haven’t been wowed by us,” says Ratner. Zappos is so
eager to wow employees and make sure who they hire
is committed that they offer people $3,000 after they’ve
been trained to walk away if they feel they and Zappos
aren’t a good fit. Almost no one takes the $3,000 walkaway money. But many trainees return for more Zappos
training to become managers.
SOURCE: Excerpted from J Larrere, “Develop Great Leaders,”
Leadership Excellence, April 2010, p 12.
Why would Zappos’s approach to recruiting
result in greater PE fit?
employees to have fun at work. These employees are
enjoying a game of Nerf basketball.
H
I
G
G
S
,
The “Wow” factor at Zappos is partly created by encouraging
A
N
G
product development teams. Job rotation and cross-training are also sucE networking opportunities sounds trivial, but
cessful. Creating informal
the evidence is strong that
L relationships heavily impact productivity and
creativity.”45
A
10. Organizational systems and procedures. Companies are increasingly using
electronic networks to enhance collaboration among employees in order to
achieve innovation, quality,
3 and efficiency. For example, Serena Software, a
California-based company with 800 employees located in 29 offices across
14 countries, encouraged0its employees to sign up for Facebook for free, and
to use the network as a vehicle
4 for getting to know each other. In contrast to
using a public site for networking, Dow Chemical launched its own internal
8
social network in order to create relationships between current, past, and
46
temporary employees. B
11. Organizational goals and the
U associated criteria used for recruitment, selection,
development, promotion, layoffs, and retirement of people. Zappos, which was
ranked as the 15th best place to work by Fortune in 2009, spends a great deal
of time trying to hire people who will fit into its clan-based culture (see Real
World/Real People above). As you read this box keep in mind what you read
earlier about PE fit.
Back to the Chapter-Opening Case
Which of the 11 methods or techniques for changing organizational culture were used
by Southwest Airlines?
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Chapter Three
Organizational Culture, Socialization, and Mentoring
The Organizational Socialization
Process
TO THE POINT
Organizational socialization is defined as “the process by which a person learns the
values, norms, and required behaviors which permit him to participate as a member of the organization.”47 As previously discussed, organizational socialization is
a key mechanism used by organizations to embed their organizational cultures. In
short, organizational socialization turns outsiders into fully functioning insiders
by promoting and reinforcing the organization’s core values and beliefs. This section introduces a three-phase model of organizational socialization and examines
the practical application of socialization research.
LO.8
77
How can the practical
lessons of socialization
research be integrated
within the three phases
of socialization?
A Three-Phase Model
of Organizational Socialization
H
I
One’s first year in a complex organization can be confusing.
There is a constant swirl
of new faces, strange jargon, conflicting expectations, and apparently unrelated
G
events. Some organizations treat new members in a rather haphazG socialization
ard, sink-or-swim manner. More typically, though, the
process is characterized by a sequence of identifiableSsteps.
Organizational behavior researcher Daniel Feldman has pro,
posed a three-phase model of organizational socialization
that
promotes deeper understanding of this important process. As
illustrated in Figure 3–5, the three phases are (1) anticipatory soA
cialization, (2) encounter, and (3) change and acquisition.
Each
phase has its associated perceptual and social processes.
Feldman’s
N
model also specifies behavioral and affective outcomes that can be
G
used to judge how well an individual has been socialized.
The entire three-phase sequence may take from a few weeks
E to a year to
complete, depending on individual differences and the complexity
L
of the situation.
A
Phase 1: Anticipatory Socialization
The anticipatory socialization phase occurs before an individual actually joins
3 people have
an organization. It is represented by the information
learned about different careers, occupations, professions,
and or0
ganizations. Anticipatory socialization information comes from
many sources. An organization’s current employees4are a powerful
source of anticipatory socialization. So are the Internet
and so8
cial media. For example, PricewaterhouseCoopers (PwC), the largB web-based
est professional services firm in the world, uses several
sources to attract potential employees. “PwC’s early
Uidentification
strategy is supported by the pwc.tv Website, Feed Your Future magazine (downloadable through pwc.tv; it showcases the lives/careers
of PwC professionals), and Leadership Adventure (face-to-face
learning programs that emphasize the PwC Behaviors).48
organizational socialization Process by which employees learn an
organization’s values, norms, and
required behaviors.
kre29368_ch03_060-087.indd 77
These onlookers gathered outside the
Hyderabad offices of PriceWaterhouseCoopers
as police officers worked inside the building. The
company was responsible for auditing Satyam
Computers, and the former chairman was
imprisoned after admitting to a $1 billion fraud.
anticipatory socialization phase
Occurs before an individual joins an
organization, and involves the information people learn about different
careers, occupations, professions,
and organizations.
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figure 3–5
The World of Organizational Behavior
A Model of Organizational Socialization
Outsider
Phases
Perceptual and Social Processes
1. Anticipatory socialization
Learning that occurs prior to
joining the organization
• Anticipating realities about the organization
and the new job
• Anticipating organization’s needs for one’s
skills and abilities
• Anticipating organization’s sensitivity to
one’s needs and values
2. Encounter
Values, skills, and attitudes start to
shift as new recruit discovers what
the organization is truly like
• Managing lifestyle-versus-work conflicts
• Managing intergroup role conflicts
H• Seeking role definition and clarity
• Becoming familiar with task and group
I dynamics
G
G
S• Competing role demands are resolved
• Critical tasks are mastered
, • Group norms and values are internalized
3. Change and acquisition
Recruit masters skills and roles
and adjusts to work group's
values and norms
Behavioral Outcomes
• Performs role assignments
• Remains with organization
• Spontaneously innovates
and cooperates
A
N
SocializedG
insider
E
L
A
Affective Outcomes
• Generally satisfied
• Internally motivated to work
• High job involvement
SOURCE: Adapted from material in D C Feldman, “The Multiple Socialization of Organization Members,” Academy of Management Review,
April 1981, pp 309–18. Copyright © 1981 by The Academy of Management. Reproduced by permission of The Academy of Management via
Copyright Clearance Center.
3
0
Unrealistic expectations about the nature of the work, pay, and promotions are
often formulated during phase41. Because employees with unrealistic expectations
are more likely to quit their jobs
8 in the future, organizations may want to use realistic job previews. A realistic job preview (RJP) involves giving recruits a realistic
B
idea of what lies ahead by presenting
both positive and negative aspects of the
job. Whirlpool, for example, uses
its
career
website to post candid comments from
U
Go to
www.mcgrawhillconnect.com
for an interactive exercise to
test your knowledge of the
organizational socialization
process.
employees about what it is like to work at the company.49 RJPs may be electronic,
verbal, in booklet form, audiovisual, or hands on. Research supports the practical benefits of using RJPs. A meta-analysis of 40 studies revealed that RJPs were
related to higher performance and to lower attrition from the recruitment process.
Results also demonstrated that RJPs lowered job applicants’ initial expectations
and led to lower turnover among those applicants who were hired.50
Phase 2: Encounter
This second phase begins when the employment contract has been signed. During the encounter phase employees come to learn what
the organization is really like. It is a time for reconciling unmet expectations and
making sense of a new work environment. Many companies use a combination
of orientation and training programs to socialize employees during the encounter
phase. Onboarding is one such technique. Onboarding programs help employees
to integrate, assimilate, and transition to new jobs by making them familiar with
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Chapter Three
Organizational Culture, Socialization, and Mentoring
79
corporate policies, procedures, culture, and politics and by clarifying work-role expectations and responsibilities.51 Automatic Data Processing’s (ADP) onboarding
program consists of a combination of online training, classroom training, meetings
with employees, written materials containing guidelines on what to expect in the
first 90 days, an assimilation guide, and social networking. The company believes
that these efforts are helping it to turn newcomers into fully functioning employees.52
Phase 3: Change and Acquisition The change and acquisition phase requires employees to master important tasks and roles and to adjust to their work
group’s values and norms. This will only occur when employees have a clear understanding about their roles—role clarity is discussed in Chapter 10—and they
are effectively integrated within the work unit. Being successful in phase 3 also
necessitates that employees have a clear understanding regarding the use of social media. It is easy for you to create problems for yourself by not being aware
of expectations regarding surfing, texting during meetings, and sending personal
messages on company equipment. Experts suggest setting
H ground rules on the first
day of employment, coaching employees on norms, and discussing how guideI
lines have changed over time.53 Additionally, organizations such as Schlumberger,
a large multinational oil company, use incentives andGsocial gatherings to reinforce
the new behaviors expected of employees.
G
S
Example. The company is gradually changing its old
, Soviet culture of blame. Luc
Ollivier, a 50-year-old Frenchman, was installed as the boss of regional operations
Siberian Geophysical. He’s trying to reward performance and, more critical, systematically eliminate mistakes rather than simply punish
Athe people who make them.
Ollivier says the company’s veteran drillers have immense experience, “but they don’t
N better ties through daylong
like to teach the young people.” So he is working to forge
get-togethers that conclude with a beer bash. OllivierG
says the pace of work is up by
more than 30% in the past two years., and Siberian Geophysical’s drilling revenues
E their level in 2006.54
reached about $250 million last year [2007], about double
L
A or tactics used by organizaTable 3–1 presents a list of socialization processes
tions to help employees through this adjustment process. Returning to Table 3–1,
can you identify the socialization tactics used by Schlumberger?
3
0
Practical Application of Socialization
Research
Past research suggests five practical guidelines 4
for managing organizational
socialization.
8
1. A recent survey showed that effective onboarding
B programs resulted in increased retention, productivity, and rates of task completion for new hires.55
Ushould avoid a haphazard,
This reinforces the conclusion that managers
sink-or-swim approach to organizational socialization because formalized
socialization tactics positively affect new hires. Formalized or institutionalized socialization tactics were found to positively help employees in both
domestic and international operations.56
realistic job preview Presents
both positive and negative aspects
of a job.
encounter phase Employees learn
what the organization is really like
and reconcile unmet expectations.
kre29368_ch03_060-087.indd 79
onboarding Programs aimed
at helping employees integrate,
assimilate, and transition to new jobs.
change and acquisition phase
Requires employees to master
tasks and roles and to adjust to
work group values and norms.
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80
Part One
LO.9
table 3–1
The World of Organizational Behavior
Socialization Tactics
TACTIC
DESCRIPTION
Collective vs. individual
Collective socialization consists of grouping newcomers and exposing them to a
common set of experiences rather than treating each newcomer individually and
exposing him or her to more or less unique experiences.
Formal vs. informal
Formal socialization is the practice of segregating a newcomer from regular
organization members during a defined socialization period versus not clearly
distinguishing a newcomer from more experienced members. Army recruits must
attend boot camp before they are allowed to work alongside established soldiers.
Sequential vs. random
Sequential socialization refers to a fixed progression of steps that culminate in the
new role, compared to an ambiguous or dynamic progression. The socialization
of doctors involves a lock-step sequence from medical school, to internship, to
residency before they are allowed
Hto practice on their own.
Fixed vs. variable
I
Fixed socialization provides a timetable
for the assumption of the role, whereas a
variable process does not. American university students typically spend one year
G
apiece as freshmen, sophomores, juniors, and seniors.
Serial vs. disjunctive
A serial process is one in which the newcomer is socialized by an experienced
S
member, whereas a disjunctive process
does not use a role model.
Investiture vs. divestiture
, of a newcomer’s incoming global and specific
Investiture refers to the affirmation
role identities and attributes. Divestiture is the denial and stripping away of the
newcomer’s existing sense of self and the reconstruction of self in the organization’s
image. During police training, cadets
A are required to wear uniforms and maintain an
immaculate appearance; they are addressed as “officer” and told they are no longer
N of the police force.
ordinary citizens but representatives
G
G
E
L
2. Organizations like the U.S. Military Academy at West Point use socialization
A
tactics to reinforce a culture that promotes ethical behavior. Managers are
SOURCE: Descriptions were taken from B E Ashforth, Role Transitions in Organizational Life: An Identity-Based Perspective (Mahwah, NJ:
Lawrence Erlbaum Associates, 2001), pp 149–83.
encouraged to consider how they might best set expectations regarding ethi57
cal behavior during all three
3 phases of the socialization process.
3. The type of orientation program used to socialize employees affects their
0 A recent study of 72 new Asian international
expectations and behavior.
graduate students revealed
4 that they had more accurate expectations, felt
less stress, reported better adjustment, and had higher retention rates when
8
the orientation program focused on coping with new entry stress.58 Managers
B
need to help new hires integrate
within the organizational culture and overcome the stress associatedUwith working in a new environment. Consider the
approach used by John Chambers, CEO of Cisco Systems: “He meets with
groups of new hires to welcome them soon after they start, and at monthly
breakfast meetings workers are encouraged to ask him tough questions.”59
4. Support for stage models is mixed. Although there are different stages of
socialization, they are not identical in order, length, or content for all people
or jobs.60 Managers are advised to use a contingency approach toward organizational socialization. In other words, different techniques are appropriate
for different people at different times.
5. Managers should pay attention to the socialization of diverse employees.
Research demonstrated that diverse employees, particularly those with disabilities, experienced different socialization activities than other newcomers.
In turn, these different experiences affected their long-term success and job
satisfaction.61
kre29368_ch03_060-087.indd 80
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Chapter Three
Organizational Culture, Socialization, and Mentoring
Embedding Organizational Culture
through Mentoring
The modern word mentor derives from Mentor, the name of a wise and trusted
counselor in Greek mythology. Terms typically used in connection with mentoring are teacher, coach, sponsor, and peer. Mentoring is defined as the process
of forming and maintaining intensive and lasting developmental relationships
between a variety of developers (i.e., people who provide career and psychosocial support) and a junior person (the protégé, if male; or protégée, if female).62
Mentoring can serve to embed an organization’s culture when developers and the
protégé/protégée work in the same organization for two reasons. First, mentoring
contributes to creating a sense of oneness by promoting the acceptance of the
organization’s core values throughout the organization. Second, the socialization
aspect of mentoring also promotes a sense of membership.
Not only is mentoring important as a tactic for embedding
organizational culH
ture, but research suggests it can significantly influence the protégé/protégée’s fuI
ture career. For example, a meta-analysis revealed that mentored employees had
G
higher compensation and more promotions than nonmentored
employees. Mentored employees also were found to have higher organizational
knowledge, job
G
performance, and salary over time.63 This section focuses on how people can use
S of mentoring, the develmentoring to their advantage. We discuss the functions
opmental networks underlying mentoring, and the, personal and organizational
implications of mentoring.
81
TO THE POINT
What are the four
developmental networks
and how can you use
them to advance your
career?
A
N
Kathy Kram, a Boston University researcher, conducted in-depth interviews
G managers. As a by-product
with both members of 18 pairs of senior and junior
of this study, Kram identified two general functions—career
and psychosoE
cial—of the mentoring process. Five career functions that enhanced career
L
development were sponsorship, exposure-and-visibility,
coaching, protection,
and challenging assignments. Four psychosocial functions
were role modeling,
A
Functions of Mentoring
acceptance-and-confirmation, counseling, and friendship. The psychosocial
functions clarified the participants’ identities and enhanced their feelings of
3
competence.64
0
4
LO.10 Developmental Networks
Underlying Mentoring 8
B
Historically, it was thought that mentoring was primarily
provided by one person who was called a mentor. Today, however, theUchanging nature of technology, organizational structures, and marketplace dynamics require that people
seek career information and support from many sources. Mentoring is currently viewed as a process in which protégés and protégées seek developmental
guidance from a network of people, who are referred to as developers. McKinsey
& Company tells its associates, “Build your own McKinsey.” This slogan means
the consulting firm expects its people to identify partners, colleagues, and
mentoring Process of forming
and maintaining developmental
relationships between a mentor and
a junior person.
kre29368_ch03_060-087.indd 81
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82
Part One
The World of Organizational Behavior
figure 3–6
Developmental Networks Associated with Mentoring
Developmental relationship diversity
Developmental relationship strength
Weak ties
Strong ties
D2
D2
Low
range
D1
D1
P
P
Traditional
Receptive
D1
High
range
D3
H
I
PG
G
S
Opportunistic
,
D2
D1
D2
P
D4
D4
D3
Entrepreneurial
Key: D, developer; P, protégé
SOURCE: From M Higgins and K Kram, “Reconceptualizing Mentoring at Work: A Developmental Network
Perspective,” Academy of Management Review, April 2001, p 270. Copyright © 2001 by The Academy of
Management. Reproduced by permission of The Academy of Management via Copyright Clearance Center.
A
N
G
E
subordinates who have related goals and interests so that they can help one
L Each McKinsey associate is thus responsible
another develop their expertise.
for his or her own career development—and
for mentoring others. As McKinA
sey’s approach recognizes, the diversity and strength of a person’s network of
relationships is instrumental in obtaining the type of career assistance needed
65
Figure 3–6 presents a developmental network
to manage his or her career.3
typology based on integrating the diversity and strength of developmental
0
relationships.66
4 relationships reflects the variety of people within
The diversity of developmental
the network an individual uses8for developmental assistance. There are two subcomponents associated with network diversity: (1) the number of different people
the person is networked with B
and (2) the various social systems from which the
networked relationships stem U
(e.g., employer, school, family, community, professional associations, and religious affiliations). As shown in Figure 3–6, developmental relationship diversity ranges from low (few people or social systems) to
high (multiple people or social systems).
Developmental relationship strength reflects the quality of relationships among
the individual and those involved in his or her developmental network. For example, strong ties are reflective of relationships based on frequent interactions,
reciprocity, and positive affect. Weak ties, in contrast, are based more on superficial relationships. Together, the diversity and strength of developmental relationships result in four types of developmental networks (see Figure 3–5): receptive,
traditional, entrepreneurial, and opportunistic.
A receptive developmental network is composed of a few weak ties from one
social system such as an employer or a professional association. The single oval
around D1 and D2 in Figure 3–6 is indicative of two developers who come from
kre29368_ch03_060-087.indd 82
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Chapter Three
Organizational Culture, Socialization, and Mentoring
83
one social system. In contrast, a traditional network contains a few strong ties
between an employee and developers that all come from one social system. An
entrepreneurial network, which is the strongest type of developmental network,
is made up of strong ties among several developers (D1–D4) who come from four
different social systems. Finally, an opportunistic network is associated with having weak ties with multiple developers from different social systems.
Personal and Organizational Implications
There are five key personal implications to consider. First, it is important to
foster a broad developmental network because the number and quality of your
contacts will influence your career success. Second, job and career satisfaction
are likely to be influenced by the consistency between your career goals and the
type of developmental network at your disposal. For example, people with an
entrepreneurial developmental network are more likely to experience change in
Hthan people with receptive,
their careers and to benefit from personal learning
traditional, and opportunistic networks. If this sounds
attractive to you, you
I
should try to increase the diversity and strength of your developmental relationships. In contrast, lower levels of job satisfaction G
are expected when employees
have receptive developmental networks and they desire
G to experience career advancement in multiple organizations. Receptive developmental networks, howS
ever, can be satisfying to someone who does not desire to be promoted up the
,
career ladder.67
Third, a developer’s willingness to provide career and psychosocial assistance is a function of the protégé/protégée’s ability and potential and the qualA shows that the quality of
ity of the interpersonal relationship.68 Research also
the mentoring relationship is likely to be higherN
when the parties have common values and personality characteristics.69 This implies that you must take
ownership for enhancing your skills, abilities, andGdevelopmental networks as
well as your interpersonal relationships if you desire
E to experience career advancement throughout your life. Fourth, it is important to become proficient at
L
using social networking tools such as Twitter, LinkedIn,
and Facebook. Companies such as AT&T are increasingly using onlineAtools to conduct mentoring
across geographical boundaries (see Real World/Real People on page 84).
These tools not only enable you to increase the breadth of your social network, but they also can increase your productivity.3Finally, you should develop
a mentoring plan. Experts suggest that this plan should include the following
0
components:70
4
• Identify and prioritize your mentoring goals. These goals should be based
on a determination of what you want to learn.8
• Identify people who are skilled or experiencedB
in areas you want to improve. Don’t overlook your peers as they are a good source of functional,
U
technical, and organizational knowledge.
• Determine how best to build a relationship with these “targeted”
individuals.
• Determine how you can provide value to your mentor. Because mentoring
is a two-way street, others are more likely to help you if they see some value
in assisting you in the pursuit of your career goals.
diversity of developmental
relationships The variety of people
in a network used for developmental assistance.
kre29368_ch03_060-087.indd 83
developmental relationship
strength The quality of relationships among people in a network.
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84
Part One
The World of Organizational Behavior
real WORLD // real PEOPLE
AT&T Conducts Mentoring Online
At AT&T mentoring takes place in self-organizing, topicbased groups, which AT&T calls leadership circles. The
self-organizing approach allows them to reach far more
employees than programs run by HR. Using an online
platform, one mentor can work with several mentees at
a time—sometimes in different locations—on skills like
generating sales leads or leading teams. The circles
take advantage of platform features such as community
forums, document-sharing spaces, group polling, and
calendars that announce events and mentor availability.
Since the supporting software has some built-in socialnetworking capability, mentees are able to connect to
others with very little hands-on assistance from HR;
peer-to-peer mentoring often starts to take place within
a circle as it matures. Managers frequently share mentoring responsibilities within a circle—for instance, three
executives might work together to advise a group of nine
employees. Face-to-face meetings, conference calls,
and webcast supplement the online coaching.
H
I
G
G would you like to be mentored online inHow
stead
S of face to face?
SOURCE:
Excerpted from J C Meister and K Willyerd, “Mentoring
,
Millennials,” Harvard Business Review, May 2010, p 71.
A
N
G
• Determine when it is time to move on. Mentors are not forever. If you beE
lieve that your mentor is ineffective, or worse yet, causing more harm than
L
benefit, find a new mentor.
Research also supports the A
organizational benefits of mentoring. For example,
mentoring enhances the effectiveness of organizational communication. Specifically, mentoring increases the amount of vertical communication both up and
3
down an organization, and it provides
a mechanism for modifying or reinforcing
organizational culture. Benefits
such
as
these are leading more and more compa0
nies to set up formal mentoring programs. A survey found that 6 out of 10 companies already have programs4for coaching or mentoring, and of the remaining
companies, 8 out of 10 are planning
such a program.71
8
B
U
Summary of Key Concepts
1. Define organizational culture and discuss its three layers. Organizational culture represents the shared assumptions that a group holds. It influences employees’
perceptions and behavior at work. The three layers of
organizational culture include observable artifacts, espoused values, and basic assumptions. Artifacts are the
physical manifestations of an organization’s culture.
Espoused values represent the explicitly stated values
and norms that are preferred by an organization. Basic
underlying assumptions are unobservable and represent
the core of organizational culture.
kre29368_ch03_060-087.indd 84
2. Discuss the difference between espoused and enacted
values. Espoused values represent the explicitly stated
values and norms that are preferred by an organization.
Enacted values, in contrast, reflect the values and norms
that actually are exhibited or converted into employee
behavior.
3. Describe the four functions of organizational culture. Four
functions of organizational culture are organizational
identity, collective commitment, social system stability,
and sense-making device.
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Chapter Three
Organizational Culture, Socialization, and Mentoring
buildings; (c) slogans, language, acronyms, and sayings; (d ) deliberate role modeling, training programs,
teaching, and coaching by managers and supervisors;
(e) explicit rewards, status symbols, and promotion criteria; ( f ) stories, legends, and myths about key people
and events; (g) the organizational activities, processes,
or outcomes that leaders pay attention to, measure, and
control; (h) leader reactions to critical incidents and
organizational crises; (i ) the workflow and organizational
structure; ( j ) organizational systems and procedures; and
(k) organizational goals and associated criteria used for
recruitment, selection, development, promotion, layoffs,
and retirement of people.
4. Discuss the four types of organizational culture associated
with the competing values framework. The competing
values framework identifies four different types of organizational culture. A clan culture has an internal focus
and values flexibility rather than stability and control.
An adhocracy culture has an external focus and values
flexibility. A market culture has a strong external focus
and values stability and control. A hierarchy culture has
an internal focus and values stability and control over
flexibility.
5. Summarize the five conclusions derived from research
about the outcomes associated with organizational culture. Organizational culture is related to measures of
organizational effectiveness. Employees are more satisfied and committed to organizations with clan cultures.
An organization’s financial performance is not very
strongly related to organizational culture. Innovation H
and quality can be increased by building characteristics
associated with clan, adhocracy, and market cultures I
into the organization. Culture is not strongly related
G
to financial performance, and companies with market
cultures tend to have more positive organizational
G
outcomes.
85
8. Describe the three phases in Feldman’s model of organizational socialization. The three phases of Feldman’s
model are anticipatory socialization, encounter, and
change and acquisition. Anticipatory socialization
begins before an individual actually joins the organization. The encounter phase begins when the employment
contract has been signed. Phase 3 involves the period in
which employees master important tasks and resolve any
role conflicts.
S 9. Discuss the various socialization tactics used to socialize
employees. There are six key socialization tactics. They
6. Review the four caveats about culture change. First,
,
are collective versus individual, formal versus informal,
managing organizational culture is one of the most
sequential versus random, fixed versus variable, serial
important functions of leadership. Second, the process
versus disjunctive, and investiture versus divestiture (see
of culture change begins by targeting one of the three
Table 3–1). Each tactic provides organizations with two
layers of organizational culture. Third, it is important A
opposing options for socializing employees.
to consider the extent to which the current culture is
N
aligned with the organization’s vision and strategic plans
10. Explain the four developmental networks associated
before attempting to change any aspect of organiza- G
with mentoring. The four developmental networks are
tional culture. Finally, it is important to use a structured
based on integrating the diversity and strength of an
E
approach when implementing culture change.
individual’s developmental relationships. The four resulting developmental networks are receptive, traditional,
7. Summarize the methods used by organizations to change L
entrepreneurial, and opportunistic. A receptive network
organizational culture. Changing culture amounts to
is composed of a few weak ties from one social system.
teaching employees about the organization’s preferred A
Having a few strong ties with developers from one social
values, beliefs, expectations, and behaviors. This is acsystem is referred to as a traditional network. An encomplished by using one or more of the following 11
trepreneurial network is made up of strong ties among
mechanisms: (a) formal statements of organizational 3
several developers; and an opportunistic network is
philosophy, mission, vision, values, and materials
0
associated with having weak ties from different social
used for recruiting, selection, and socialization; (b) the
systems.
design of physical space, work environments, and
4
8
B
U
Key Terms
Organizational culture, 62
Adhocracy culture, 70
Encounter phase, 78
Values, 63
Market culture, 70
Onboarding, 78
Espoused values, 63
Hierarchy culture, 70
Change and acquisition phase, 79
Sustainability, 64
Vision, 73
Mentoring, 81
Enacted values, 65
Strategic plan, 74
PE Fit, 65
Organizational socialization, 77
Diversity of developmental
relationships, 82
Competing values framework
(CVF), 68
Anticipatory socialization
phase, 77
Developmental relationship
strength, 82
Clan culture, 68
Realistic job preview, 78
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86
Part One
The World of Organizational Behavior
OB in Action Case Study
Sergio Marchionne Undertakes Major Strategic and Culture Change
at Chrysler Group72
A decline in sales isn’t the only big problem facing Chrysler
Group LLC. Another, according to Chief Executive Sergio
Marchionne, is the almost ingrained tendency to react to
falling sales by slashing prices.
In Detroit, “there’s almost a fanatical, maniacal interest
in (market) share,” Mr. Marchionne told reporters Monday
on the opening day of the North American International
Auto Show. But rarely, he added, has heavy discounting
in pursuit of high volumes helped auto makers generate
profits in the long term. . . .
For the past seven months, the 57-year-old Italian-born
Canadian has been working to shake up Chrysler and move
the company away from old ways that forced it into bankruptcy reorganization last year. He has ousted several veteran executives, flattened its bureaucracy and, according
to people who have worked closely with Mr. Marchionne,
injected an element of fear into its ranks.
One of the more frustrating problems for Mr. Marchionne has been the use of heavy rebates and other incentives to maintain sales—an issue that has plagued General
Motors Co. and Ford Motor Co. over the years.
Last July, for example, when the U.S. government offered as much as $4,500 in “cash for clunkers” rebates,
Chrysler’s sales chief at the time, Peter Fong, drew up a
plan to offer an additional $4,500 from Chrysler, two people familiar with the matter said. . . .
But when Mr. Marchionne found out about it, he was
furious, these people said. In an August meeting with Mr.
Fong and his sales team, the CEO excoriated them, saying
doubling discounts amounted to “giving away margin” at a
time when Chrysler was scrambling for profits, one person
familiar with the details of the meeting said. “Sergio was
ballistic,” this person said. . . .
Several weeks later, in September, Mr. Fong was summoned to the office of Nancy Rae, Chrysler’s head of
human resources, and was told his services were no longer
needed, these people said. . . .
Mr. Marchionne took the helm at Chrysler in June,
when the company exited bankruptcy protection and
formed an alliance with Italy’s FIAT SpA, where he also
serves as CEO and which owns about 20% of Chrysler. In
November, he laid out a turn-around plan that calls for
Chrysler to launch a series of small cars designed by Fiat,
and envisions Chrysler breaking even in 2010 and returning to profitability by 2011.
Besides working out ways for the two companies to
work together, Mr. Marchionne has tried to shake up
Chrysler’s plodding corporate culture. . . .
To select his new management team, Mr. Marchionne
held dozens of 15-minute interviews with Chrysler executives over several days to evaluate which ones to keep and
which to push out, according to people who participated
in the process.
kre29368_ch03_060-087.indd 86
When the process was over, Mr. Marchionne had 23
people reporting to him. Some were junior executives who
had been moved up a level or two in the organization. . . .
Many in the industry believe Mr. Machionne has no option but to shock Chrysler out of its old ways. “The culture
in Detroit is so insular, and he’s going to have to throw
some china against the wall,” said Michael J. Jackson,
chairman and CEO of AutoNation Inc., a large dealership
chain. . . .
Mr. Marchionne took an office on the fourth floor of
the
Htechnology center at Chrysler’s headquarters in Auburn Hills, Mich., among Chrysler’s engineers, instead of
anI office in its adjoining executive tower. His management
team
G began meeting weekly in a nearby conference room
equipped with video gear so that Fiat executives in Italy
G take part.
could
SIn these meetings, Mr. Marchionne often spelled out
what he saw as Chrysler’s many deficiencies: margins and
vehicle
, quality needed to improve and better control over
pricing was imperative, according to one person who has
been in the sessions. Details of the discussions weren’t to
leave
A the room. Security officers even called senior executives over the summer to make sure no one was talking to
N
reporters
about the company’s plans.
Mr.
Marchionne,
a notorious workaholic, carries five
G
BlackBerrys and works seven days a week. He spends
about
E one full week a month in Michigan and flies back for
weekend meetings when he isn’t in town.
L
Questions
for Discussion
A
1. What are the observable artifacts, espoused values, and
basic assumptions associated with Chrysler’s culture?
3Explain.
2.0How is Mr. Machionne trying to improve the PE fit of
his direct reports?
4
3. Use the competing values framework to diagnose
8Chrysler’s culture. To what extent does it possess characteristics associated with clan, adhocracy, market, and
Bhierarchy cultures? Discuss.
4.U
Begin by looking up Chrysler’s mission or vision statement on the company’s website. Now answer the following question: To what extent is the culture type you
identified in question 2 consistent with the accomplishment of this mission or vision? Explain.
5. Which of the mechanisms for changing organizational
culture did Mr. Marchionne use at Chrysler? Explain.
6. Would you like to work at Chrysler? Explain your
rationale.
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Chapter Three
Organizational Culture, Socialization, and Mentoring
87
Legal/Ethical Challenge
Credit-Card Issuers Have Cultures That Focus on Growth by Targeting
Financially Strapped People73
The troubles sound familiar. Borrowers falling behind
on their payments. Defaults rising. Huge swaths of loans
souring. Investors getting burned. But forget the nowfamiliar tales of mortgages gone bad. The next horror for
beaten-down financial firms is the $950 billion worth of
outstanding credit-card debt—much of it toxic. . . . The
consumer debt bomb is already beginning to spray shrapnel throughout the financial markets, further weakening
the U.S. economy. “The next meltdown will be in credit
cards,” says Gregory Larkin, senior analyst at research firm
Innovest Strategic Value Advisors. . . .
H
But some banks and credit-card companies may be exI
acerbating their problems. To boost profits and get ahead
of coming regulation, they’re hiking interest rates. But
G
that’s making it harder for consumers to keep up. . . .? Sure
G
the credit-card market is just a fraction of the $11.9 trillion
mortgage market. But sometimes the losses can be more
S
painful. That’s because most credit-card debt is unsecured,
meaning consumers don’t have to make down payments
,
when opening up their accounts. If they stop making
monthly payments and the account goes bad, there are
no underlying assets for credit-card companies to recoup.
A
With mortgages, in contrast, some banks are protected
N
both by down payments and by the ability to recover at
least some of the money by selling the property. . . .
G
The industry’s practices during the lending boom are
coming back to haunt many credit-card lenders now. Cate
E
Colombo, a former call center staffer at MBNA, the big
L
A
Web Resources
issuer bought by Bank of America in 2005, says her job
was to develop a rapport with credit-card customers and
advise them to use more of their available credit. Colleagues would often gather around her chair when she was
on the phone with a customer and chant: “Sell, sell.” “It
was like Boiler Room,” says Colombo, referring to the 2000
movie about unscrupulous stock brokers. “I knew that they
would probably be in debt for the rest of their lives.” Unless, of course, they default.
Assume that you are member of
Congress. What would you do in
light of the facts in this case?
1. Create legislation that does not allow credit-card issuers to raise interest rates for those who cannot pay
their bills.
2. Create legislation that makes it a crime for people like
Cate Columbo to entice people to spend money on a
credit card when they can’t afford it.
3. I would not create any legislation. Credit-card issuers
and people like Cate Columbo are not to blame for our
financial problems. People must be responsible for their
own behavior.
4. Invent other options.
3
Additional tools and resources are available to help you master
0 the content of this chapter on the website at
www.mhhe.com/kreitner10e
4
8
B
U
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par t t wo
H
IndividualI Behavior
G
G
in Organizations
S
,
5
Key Individual Differences and the Road to Success
6
Values, Attitudes, Job Satisfaction, and
N
Counterproductive Work Behaviors
7
8
9
A
G
Social Perception
E and Attributions
L
Foundations of Motivation
A
Improving Job Performance with Goals, Feedback,
Rewards, and 3Positive Reinforcement
0
4
8
B
U
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chapter 5
Key Individual Differences
H
I
and the Road to Success
G
Learning Objectives
G
S
,
When you finish studying the material in this chapter, you should be able to:
LO.1
LO.2
LO.3
LO.4
LO.5
LO.6
LO.7
A
Define self-esteem, and explain how it can
N be improved with Branden’s six pillars of
self-esteem.
G
E
Define self-efficacy, and explain its sources.
L
Contrast high and low self-monitoring individuals, and discuss the ethical implications of
A
organizational identification.
Identify and describe the Big Five personality
dimensions, and specify which one is
3
correlated most strongly with job performance.
0
Describe the proactive personality and 4
an internal locus of control.
8
Identify at least five of Gardner’s eight multiple
intelligences.
B
Distinguish between positive and negative
U emotions, and explain how they can be
judged.
LO.8
Identify the four key components of emotional intelligence, and discuss the practical
significance of emotional contagion and emotional labor.
LO.9
Explain how psychological capital, deliberate practice, luck, and humility can pave your
road to success.
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12/6/11 5:01 PM
Can an Introvert Guide Facebook to Long-Term Success?
In his book, The Facebook Effect: The Inside Story
of the Company That Is Connecting the World, David
Kirkpatrick provides instructive insights into the per-H
sonality and character of the company’s founder andI
CEO. This excerpt looks back at Mark Zuckerberg as
a college computer whiz on his way to becoming CEOG
of an Internet giant. By early 2011, Facebook’s moreG
than 500 million active users (over 70% from outsideS
the United States) shared 30 billion pieces of content
,
each month.1
Mark Zuckerberg was a short, slender, intense introvert with curly brown hair whose fresh freckled face
made him look closer to fifteen than the nineteen he
was [at Harvard]. His uniform was baggy jeans, rubber sandals—even in winter—and a T-shirt that usually
had some sort of clever picture or phrase. One he was
partial...
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