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OB chapter 15

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patricia uytiongco

on 27 September 2012

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Transcript of OB chapter 15

ORGANIZATIONAL CULTURE AND INNOVATION CHAPTER 15 Presented by: KREISTEIN GALDONES THRIZA GARCIA CHARLES GARCIA KARLA HECHANOVA PATRICIA UYTIONGCO the system of shared actions,
values and beliefs that develops within an organization and guides the behavior
of its members. Organizational Culture/ Corporate Culture Functions of Organizational Culture • External Adaptation - deals with reaching goals, the tasks to be accomplished,
the methods used to achieve the goals,
and the methods of coping with success and failure - “What precisely needs to be accomplished,
and how can it be done?” Each groups of individuals
in an organization tends to: (1) Separate more important from
less important external policies

(2) Develop ways to measure their accomplishments

(3) Create explanations for why goals are not always met Aspects of coping with external reality 1. Individuals need to develop acceptable ways of
telling outsiders just how good they really are.

2. Individuals must collectively know when
and how to admit defeat. •Internal Integration -deals with the creation of a collective identity and with ways of working and living together - “How do members resolve the daily
problems associated with living and
working together?” Three important aspects
of working together are: 1. Deciding who is a member of the group and who is not
2. Developing an informal understanding of acceptable and unacceptable behavior
3. Separating friends from enemies Subcultures - are groups who exhibit unique patterns of values
and philosophies not consistent with the dominant
culture of the larger organization or system - emerges to bind individuals working intensely together to accomplish a specific task Countercultures – groups where the patterns of values
and philosophies outwardly reject
those of the organization or
social system National Culture and Corporate Culture • Importing Societal Subgroups This approach presents three primary difficulties: Subordinated groups are likely to form into a counterculture
and to work more diligently to change their statues than to
better the firm

The firm may find it extremely difficult to cope with
broader cultural changes

Firms that accept and build on natural divisions from
the larger culture may find it extremely difficult to
develop sound international operations •Building on National Cultural Diversity Multicultural Organization – a firm that values diversity but systematically works to block the transfer of societal based subcultures in to the fabric on the organization - Cox’s five-step program for developing the multicultural organization: (1) The organization should develop pluralism with the objective of multi-based socialization

(2) The firm should fully integrate its structure so that there
is no direct relationship between a naturally occurring
group and by any particular job

(3) They must integrate the informal networks by eliminating barriers and increasing participation (4) The organization should break the linkage
between naturally occurring group identity and the identity of the firm

(5) The organization must actively work to eliminate interpersonal conflict based on either the group identity or the natural backlash of the
societal based grouping Layers of Cultural Analysis • Observable Culture – the way things are done in an organization •Shared Values – play a critical part in linking people together and can provide a powerful motivational mechanism for the members of the culture •Common Cultural Assumptions – taken-for-granted truths that collections of corporate members share as a result of their joint experience Stories, Rites, Rituals, and Symbols •Founding Story - contains the lessons learned from the heroic efforts of an embattled entrepreneur, whose vision may still guide the firm •Saga – a heroic account of accomplishments •Rites – standardized and recurring activities used at special times to influence the behaviors and understanding of organizational members •Rituals – system of rites • Cultural Symbol – any object, act or event that serves to transmit cultural meaning Cultural Rules and Roles – part of the normative controls of the organization and emerge from its daily routines Shared Values, Meanings and
Organizational Myths •Shared Values – help turn routine activities into valuable and important actions, tie the corporation to the important values of society, and possibly
provide a very distinctive source of
competitive advantage. Several consultants suggest that firms develop a “strong culture”. By this, they basically mean: - A widely shared real understanding of what the firm stands for, often embodied in slogans - A concern for individuals over rules, policies, procedures, and adherence to job duties - A recognition of heroes whose actions illustrate the company’s shared philosophy and concerns -A well-understood sense of the informal rules and expectations so that employees and managers understand what is expected of them - A belief that what employees and managers do is important to share information and ideas •Shared Meanings – what you see as an outside observer may not be what organizational members experience because members may link actions to values and unstated assumption • Organizational Myths – commonly held cause-effect relationship or assertion that cannot be supported empirically Three common myths:
(1) Presumption that at least senior management has no risk bias
(2) Presumption of administrative competence
(3) Denial of trade-offs Figure 15.2 Purposeful unintended consequences arising from organizational myths Purposely unintended consequences Innovation – process of creating new ideas and putting them into practice – ideally practices that contribute to improved customer service or organizational productivity Figure 15.3 The innovation process: a case of new product development The Process of Innovation •Idea creation – to create an idea through spontaneous creativity, ingenuity, and information processing •Initial experimentation – to establish the idea’s potential value and application •Feasibility determination – to identify anticipated costs and benefits • Final Application – to produce and market a new product or service, or to implement a new approach to operations Product innovations – introduce new goods or services to better meet customer needs Process innovations – introduce into operations new and better ways of doing things Exploitation – focuses on refinement and reuse of existing products and processes Exploration – calls for the organization and its manager to stress freedom and radical thinking and therefore opens the firm to big changes-or what some call radical innovations – There appear to be four critical factors in building an ambidextrous organization: (1)Managers must recognize the tension between exploration and exploitation.
(2)Managers should realize that one form of thinking based on a
single perspective is inappropriate.
(3)Managers need to discuss with their subordinates the
paradoxes arising from simultaneously thinking about the
big ideas and sound incremental improvements.
(4)Managers must encourage subordinates to
embrace these paradoxes and use them as
motivations to provide creative solutions. Management philosophy – links key goal-related issues with key collaboration issues to come up with general ways by which the firm will manage its affairs Organizational cultural lag – a condition where dominant cultural patterns are inconsistent with new emerging innovations In the business setting: Organizational culture is often referred to as the corporate culture.
-No two individual personalities are the same.
-No two organizational cultures are identical.
-Yet there are some common cultural elements that yield stability and meaning for organization. External Adaptation involves answering important instrumental or goal-related questions concerning coping with reality: What is the real mission?
How do we contribute?
What are our goals?
How do we reach our goals?
What external forces are important?
How do we measure results?
What do we do if we do not meet
specific targets?
How do we tell others how
good we are?
When do we quit? Chris Connor of Sherwin-Willliams he was the one who expressed his firm’s approach to external adaptation in terms of winning. How to work together effectively? Individuals need to decide collectively how to allocate power, status, and authority.

They need to establish a shared understanding of who will rewards and sanction for specific types of action. How if managers fail to recognize important aspects of internal integration? Managers may fail to explain the basis for a promotion and show why this reward, the status associated to it, and the power given to the newly promoted individual are consistent with commonly shared belief. What is the effect of resolving issues of internal integration? Helps individuals develop a shared identity and a collective commitment

It may lead to longer-term of stability and provide a lens for members to make sense of their part of the world. Internal integration involves answer to important questions associated with living together: What is our unique identity?
How do we view the world?
Who is a member?
How do we allocate power, status, and authority?
How do we communicate?
What is the basis for friendship?
WHY DO WE NEED TO ANSWER THESE QUESTIONS? Every large organizations imports potentially important subcultural groupings when it hires employees from the larger society like as follows: North America – for instance, subcultures and countercultures may naturally based on ethnic, racial, gender, generational, or locational similarities. Japanese organization – subcultures often form based on the date of graduation from a university, gender, or geographic location. European firms - ethnicity and language play an important part in developing subcultures, as does gender. Less develop nations – language, education, religion, or family social status are often grounds for forming popular subcultures and countercultures. Clash of corporate cultures -It happens when employers and manager of an acquired firm may hold values and assumptions that are inconsistent with those of acquiring firm. Myths may be combine to yield purposely unintended consequences. are dramatic, unanticipated benefits or cost arising from implementation of a way of doing business.
They are called purposely because they stem for unexamined myths – myths managers think apply to others and not themselves. CURRENT EVENT Apple released the new iPhone 5, with greater technologies and innovation like the very new LTE which stands for Long Term Evolution, this LTE , is a standard for wireless communication of high-speed data for mobile phones and data terminals. Downloading apps, music and movies is very fast on this innovation.
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