YOM INSTITUTE OF ECONOMIC DEVELOPMENT

GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour

Project Planning and Management:

Organizational Behaviour- PPM 521

Group Assignment: Group-3- Case Study - TWO

Name ID
Chaka Yohannes Chaka GSRH/013/13
Desalegn Baorro Senbeto GSRH/014/13
Eden Eyasu Erasho GSRH/015/13
Eleni Tewabe G/mariyam GSRH/016/13
Ephrem Ermias Otiso GSRH/017/13
Ermias Ketena Belew GSRH/018/13
Habtamu Erkalo Basore GSRH/019/13
Jombola Wonte Guja GSRH/022/13

Assignment Question:

Creating and sustaining an organization’s

culture

Submitted to: Genet Gebre (MBA, PhD)

January 2021
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
Hawassa, Ethiopia

1. How is Organizational culture created and sustained?

1.1 How Organizational Culture Begins?
An organization’s current customs, traditions, and general way of doing things
are largely due to what it has done before and the degree of success it has had
with those endeavours.
The original source of an organization’s culture usually reflects the vision or
mission of the organization’s founders. Because the founders had the original
idea, they also may have biases on how to carry out the idea. Their focus might
be on aggressiveness or it might be on treating employees as family. The small
size of most new organizations helps the founders instil their vision in all
organizational members. Organizational cultures can develop in several different
ways, these steps are explained below: -
A. A single person (founder) has an idea for a new enterprise: 
Some organizational cultures may be the direct, or at least, indirect,
result of actions taken by the founders. The founders of an organization
traditionally have a major impact on that organization’s early culture.
They have a vision of what the organization should be.
B. Founders’ creation of a core group: 
The founder brings in one or more other key people and creates a core
group that shares a common vision with the founder. The founder’s only
hire and keep employees who think and feel the way they do.
These employees who form the core group believe that the idea is a good
one, is worth the investment of time, money, and energy. Sometimes
founders create weak cultures, and if the organization is to survive, a
new top manager must be installed who will sow the seeds for the
necessary strong culture.
C. Indoctrinate and Socialize: 
The founding core group begins to act in concert to create an
organization by raising funds, obtaining patents, incorporating, locating
land, building infrastructure and so on. The core group indoctrinate and
socialize employees to their way of thinking and feeling.
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour

D. Build a Common History:

The founders’ own behaviour acts as a role model that encourages
employees to identify with them and thereby internalize their beliefs,
values, and assumptions. At this point, others are brought into the
organization, and a common history begins to be built. When the
organization succeeds, the founder’s vision becomes seen as a primary
determinant of that success. At this point, the founders’ entire
personalities become embedded in the culture of the organization.

1.2 How Are Cultures Created?

Where do cultures come from? Understanding this question is important in

understanding how they can be changed. An organization’s culture is shaped as
the organization faces external and internal challenges and learns how to deal
with them. When the organization’s way of doing business provides a successful
adaptation to environmental challenges and ensures success, those values are
retained. These values and ways of doing business are taught to new members
as the way to do business (Schein, 1992).

The factors that are most important in the creation of an organization’s culture
include founders’ values, preferences, and industry demands.
Figure 8.11 Model Describing How Cultures Are Created and Maintained
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour

Founder Values
A company’s culture, particularly during its early years, is inevitably tied to the
personality, background, and values of its founder or founders, as well as their
vision for the future of the organization. When entrepreneurs establish their own
businesses, the way they want to do business determines the organization’s
rules, the structure set up in the company, and the people they hire to work with
them.

Founder values become part of the corporate culture to the degree to which they
help the company be successful. Thus, by providing a competitive advantage,
these values were retained as part of the corporate culture and were taught to
new members as the right way to do business.

N:B Most of today’s successful organizations follow

the vision of their founders.

Industry Demands
While founders undoubtedly exert a powerful influence over corporate cultures,
the industry characteristics also play a role. Companies within the same industry
can sometimes have widely differing cultures. At the same time, the industry
characteristics and demands act as a force to create similarities among
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
organizational cultures. For example, despite some differences, many companies
in the insurance and banking industries are stable and rule-oriented, many
companies in the high-tech industry have innovative cultures, and those in non-
profit industry may be people-oriented. If the industry is one with a large
number of regulatory requirements—for example, banking, health care, and
high-reliability (such as nuclear power plant) industries—then we might expect
the presence of a large number of rules and regulations, a bureaucratic company
structure, and a stable culture. The industry influence over culture is also
important to know because this shows that it may not be possible to imitate the
culture of a company in a different industry, even though it may seem admirable
to outsiders.

Thus, an organization's culture defines the proper way to behave within the
organization. This culture consists of shared beliefs and values established by
leaders and then communicated and reinforced through various methods,
ultimately shaping employee perceptions, behaviours and understanding.
Organizational culture sets the context for everything an enterprise does.
Because industries and situations vary significantly, there is not a one-size-fits-
all culture template that meets the needs of all organizations.
A strong culture is a common denominator among the most successful
companies. All have consensus at the top regarding cultural priorities, and those
values focus not on individuals but on the organization and its goals. Leaders in
successful companies live their cultures every day and go out of their way to
communicate their cultural identities to employees as well as prospective new
hires. They are clear about their values and how those values define their
organizations and determine how the organizations run. Conversely, an
ineffective culture can bring down the organization and its leadership.
Disengaged employees, high turnover, poor customer relations and lower profits
are examples of how the wrong culture can negatively impact the bottom line.
Mergers and acquisitions are fraught with culture issues. Even organizational
cultures that have worked well may develop into a dysfunctional culture after a
merger. Research has shown that two out of three mergers fail because of
cultural problems. Blending and redefining the cultures, and reconciling the
differences between them, build a common platform for the future. In recent
years, the fast pace of mergers and acquisitions has changed the way businesses
now meld. The focus in mergers has shifted away from blending cultures and
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
has moved toward meeting specific business objectives. Some experts believe
that if the right business plan and agenda are in place during a merger, a strong
corporate culture will develop naturally. 

1.3 Sustaining a Culture

Once a culture is in place, there are practices within the organization that act to
maintain it by giving employees a set of similar experiences. Sustaining a
culture depends on three forces. These forces are explained below:
I. Selection: 
The goal of the selection process is to identify and hire individuals who
could make the organization successful through their services. Therefore,
candidates who believe in the values of the organizational have to be
selected.
Thus, the selection process attempts to ensure a proper match in the
hiring of people who have values essentially consistent with those of the
organization or at least a good portion of those values cherished by the
organization. In this way, the selection process sustains an organization’s
culture by selecting those individuals who will fit into the organizations
core values.
II. Top Management:
Top management have an important role to play in sustaining the
organization’s culture. It is the top management who establish norms
that filter down through the organization. It is they through their conduct
both implicit and explicit that shows what is desirable. They do this
through pay raises, promotions, and other rewards.

III. Socialization: 
Socialization is the process that adapts employees to the organization’s
culture. Organization wants to help new employees adapt to its culture.
The adaptation is done through the process of “socialization”.

Socialization is made up of three stages:

a) The Pre-arrival Stage: 

 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
This stage encompasses all the learning that occurs before a new member
joins the organization. The socialization process covers both the work to
be done and the organization. The pre-arrival stage is the period of
learning in the socialization process that occurs before a new employee
joins the organization. For example, when students join a business school
to pursue their MBA degree, they are socialized to have attitudes and
behaviours that business firms want. This is so because the success
depends on the degree to which the student has correctly anticipated the
expectations and desires of those in the business school.

b) Encounter Stage:
In this stage of the socialization process, the new employee sees what the
organization is really like and confronts the possibility that expectations
and reality may diverge. In expectations prove to have been accurate, the
encounter stage merely provides a reaffirmation of the perceptions gained
during the pre-arrival stage. Those employees who fail to learn the
essential or pivotal role behaviours risk being labelled as “rebels” and face
the risk of expulsion. This further contributes to sustaining the culture.

c) Metamorphosis Stage: 
Metamorphosis stage is the stage in the socialization process in which a
new employee changes and adjusts to the job, work group and
organization. In this stage relatively long-lasting changes take place. The
employee masters the skill required for his or her job, successfully
performs his or her new roles, and makes the adjustments to his or her
work group’s values and norms. The metamorphosis stage completes the
socialization process. The new employee internalizes the norms of the
organization and his work groups and understands and accepts the norms
of the organization and his work group. The success of this stage has a
positive impact on the new employee’s productivity and his commitment
to the organization.

1.3.1 How Are Cultures Maintained?

As a company matures, its cultural values are refined and strengthened. The
early values of a company’s culture exert influence over its future values. It
is possible to think of organizational culture as an organism that protects
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
itself from external forces. Organizational culture determines what types of
people are hired by an organization and what types of people are left out.
Moreover, once new employees are hired, the company assimilates new
employees and teaches them the way things are done in the organization.
We call these processes attraction-selection-
attrition and onboarding processes. The role of leaders and reward
systems and best explaining measures taken to shape and maintain an
organization’s culture are given below.

I. Focus on the Positive. 

The power of positivity can be especially helpful to those who need a

little boost in employee morale. Negative talk (gossip, complaining
and criticizing) can bring down even the best organization. It’s toxic to
your culture, and your bottom line, so don’t let those Negative Nellies
drag you down! Next time you catch yourself saying something
negative, don’t be the Grinch, and instead create Seuss’s Land of Fott-
fa-Zee.

II. Ensure Shared Values. 

Skills and competencies are important, but behaviours are often rooted
in one’s personal values. Have your team explore their values and
share them with their colleagues. It is eye opening for staff to discover
how their values impact them as a person, and what is important to
their teammates. Be sure to hire employees who model behaviours that
fit your values.

III. Give and Receive Feedback. 

When giving feedback, be specific, focus on the observed behaviour,

and describe the impact it had. It’s important to address conflict and
how to have comfortable conversations. Most people love giving
positive feedback but dread the tough stuff. If you’re used to
structuring your feedback and developing a strong level of trust
amongst your team, the tough stuff won’t feel so difficult anymore.

IV. Follow-Through. 
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PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
Following-through builds trust and shows your commitment to getting
the job done. Consider when your residents have a special request or a
complaint, don’t you want your employees to resolve the issue and
follow up afterwards? If you agree, then you need to model this
behaviour to your employees too.

V. Care about Your Team Members. 

If you want your people to care about your residents, not just checkoff
tasks on a list, then you must care about your people! And show them
that you do.

VI. Play to Strengths and Look for the Bright Spots. 

At first glance this sounds like focusing on the positive, and it is, but
it’s more than that. Let’s use recruitment as an example, when you are
focused on strengths and what’s going well, you’ll want to look
towards your superstar employees to find out: How did we find them?
What about them makes them special? How do we keep them? How
can we replicate what’s most important? If it was referral, consider
ramping up your referral process. If they came from a local school,
consider increasing your presence at this school. If it was someone
who randomly applied online, how did they find you? What search
terms were used? Ask them what it was that attracted them to you?

VII. Set Expectations. 

All employees should know what is expected of them and in a field

where we are struggling to retain employees past the honeymoon
phase, setting expectations right from the start is critically important.
Explain the importance of the organizational culture and the mindset
that comes with being person-cantered and focused on continuous
performance improvement.

VIII. Evaluate Processes and Procedures. 

If you’re committing to continuously improving, and not falling behind

the times, you’ll need to have systems in place to constantly evaluate
and look for opportunities. You’ll also want to make sure that your
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
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PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
current processes or procedures aren’t causing a bottleneck or
hindering employees from doing the right thing.

IX. Create Opportunities for Collaboration. 

We hear time and time again that teams are working in silos and that
they aren’t working together to meet the resident’s needs. It’s
important to create opportunities for team members to collaborate with
each other.

X. Be Consistent. 

Starting and stopping new things all the time will never lead to
movement and it can cause employees to distrust management. Flavour
of the month clubs aren’t effective, and no one likes a boss who says
one thing and does another. It is better to pick one thing and follow
through on it then to try all ten, only to get overwhelmed and give up.

It was so hard to narrow this list down to just 10 and one thing we just
couldn’t leave off the list is telling stories. Bonus: You now have our
top 11 Must Do’s!

XI. Telling stories and using examples. 

Stories paint a picture; they evoke emotion. Stories help people relate;
they make an idea come to life. Next time you are working on updating
your careers section of your website, your employee orientation, or
even a simple newsletter, try including real life stories that provide
insight into your culture. Stories are a powerful marketing tool!

References

Judge, T. A., & Cable, D. M. (1997). Applicant personality, organizational culture, and
organization attraction. Personnel Psychology, 50, 359–394.

O’Reilly, C. A., III, Chatman, J. A., & Caldwell, D. F. (1991). People and organizational
culture: A profile comparison approach to assessing person-organization fit. Academy of
Management Journal, 34, 487–516.
 YOM INSTITUTE OF ECONOMIC DEVELOPMENT
GRADUATE PROGRAM
PROJECT PLANNING AND MANAGEMENT
COURSE- Organizational Behaviour
Schein, E. H. (1992). Organizational Culture and Leadership. San Francisco: Jossey-
Bass.

Sarros, J. C., Gray, J., & Densten, I. L. (2002). Leadership and its impact on organizational
culture. International Journal of Business Studies, 10, 1–26.

Jarnagin, C., & Slocum, J. W., Jr. (2007). Creating corporate cultures through mythopoetic
leadership. Organizational Dynamics, 36, 288–302.

Kerr, J., & Slocum, J. W., Jr. (2005). Managing corporate culture through reward
systems. Academy of Management Executive, 19, 130–138.