ORGANISATIONAL PROCESSES, STRUCTURE, AND CULTURE

Organisation structure defines how job tasks are formally divided, grouped, and
coordinated.

Basic Dimensions of Organisation:

1. Hierarchy of authority: Working from top to bottom, the ten directors report to the
two executive directors who report to the president who reports to the chief executive
officer. Ultimately, the chief executive officer answers to the hospital’s board of
directors.
2. Division of labour: Work specialisation/division of labour describes the degree to
which activities in the organisation are subdivided into separate jobs. The essence of
work specialisation is to divide a job into a number of steps, each completed by a
separate individual, giving employees a variety of activities to do, attaining them to
do a whole and complete job, and putting them into teams with interchangeable skills
often achieved significantly higher outputs, with increased employee satisfaction.
3. The span of control: Refers to the number of people directly responding to a given
manager. The span of control can vary from narrow to wide. The span of control
exceeding 30 can be found in assembly-line operations where machine-paced and
repetitive work substitutes for close supervision. The span of five to six was
considered best historically. Narrow or small spans have their advocated. By keeping
the span of control to five to six employees, managers can maintain close control. But
narrow span have three major drawbacks.
a. Expensive because they add levels of management.
b. Vertical communication become more complex.
c. Encourage overly tight supervision and discourage employee autonomy.

The trend in recent years has been toward a wider span of control. They are consistent
with firms, efforts to reduce costs, speed decision-making, increase flexibility, get
closer to customers, and empower employees.

4. Line versus staff position: Line managers such as the president, the two executive
directors, and the various directors occupy formal decision-making positions within
the chain of command. The chain of command is an unbroken line of authority that
extends from the top of the organisation to the lowest and clarifies who reports to
whom.

Authority refers to the right inherent in a managerial position to give orders and
expect them to be obeyed. To facilitate coordination, each managerial position is
given a degree of authority in order to meet his/her responsibilities. The principle of
aunty of command says a person should have one and only one superior to whom
 he/she is directly responsible. If the unity of command is broken, an employee might
have to cope with conflicting demands or priorities from several superiors.

5. Decentralization: Centralization refers to the degree to which decision-making is

concentrated at a single point in the organisation. In a centralized organisation, top
managers make all decision and lower-level managers merely carry out their
directives. At the other extreme, in certain organisations, decentralized
decision-making is pushed down to the managers closest to the action.

A decentralized organisation can act more quickly to solve problems, more people
provide input decisions and employees are less likely to feel alienated from those who
make decisions that affect their work lives. Management efforts to make organisation
more flexible and responsive have produced a recent trend toward decentralized
decision-making by lower-level managers, who are closer to the action and typically
has more detailed knowledge about problem than top managers.

● Example of centralized organisation: Military, Apple, Subway.

● Example of decentralized organisation: Johnson & Johnson, hotels,
supermarket, McDonald’s, Google, Amazon, Dell.

Departmentalization:

Once jobs have been divided through work specialization, they must be grouped so common
task can be coordinated. The basic by which jobs are grouped is called departmentalization.
Departmentalization can be by function, product, geography or territory, process, and
customer.

One of the most popular ways to group activities is by functions performed. Example,
manufacturing managers might organize a plant into engineering, accounting, manufacturing,
personnel and supply specialist department.

● Hospitals: Department related to research, surgery, intensive care, accounting etc.

● Travel agency: Ticket sales, visa services, insurance advisor, currency exchange, and
package tour.
● Manufacturing company: Production department, sales and marketing department, HR
department, accounting.

The major advantage of this type of functional departmentalization is efficiencies gained

from putting like specialist together.

Jobs can also be dpartmentalized by the type of product or services the organisation
produces. P & G places each major product such as tide, pantene pro-v, pampers, and pringles
under an executive who has complete global responsibility for it. The major advantage is
increased accountability for performance, because all activities related to a specific product
or service are under the direction of a single manager.
Whan a firm is departmentalized on the basis of geography or territory, the sales function
may have western, southern, midwestern, and eastern region each in effect, a department
organized around geography. This form is valuable when an organisation’s customers are
scattered over a large geographic area and have similar needs based on their location.

Process departmentalization works for processing customers as well as products.

● Example: state motor vehicle office: drivers license-several departments.

A final category of departmentalization uses the particular type of customers the organisation
seeks to reach. For example, microsoft is organized around four customer market: customer,
large corporation, software developers, and small business. Customers in each department
have a common set of problems and needs best met by having specialists for each.

Matrix structure combines two forms of departmentalization functional and product.

Companies that use matrix-like structure include P & G, IBM, BMW. The strength of
functional departmentalization is putting like specialists together which minimizes the
number necessar while allowing the pooling and showing of specialized resources aross
products. Its major disadvantage is the difficulty of coordinating the tasks of diverse
functional specialists on time and within budget. Product departmentalizaion facilitates
coordination among specialists to achieve on-time completion and meet budget targets. The
matrix attempts to gain strength of each while avoiding their weaknesses.

Employees in the matrix have two basis: their functional department managers and product
managers.

Organisational Design:

1. Classical theory: It is the first one in the line of systematic study of the organisation.
Classical management scientists treated organisations as a machine and human
resources as components of machines. This theory neglected the external
environmental factors which have an influence on work and relationships.
a. Two streams of classical theory: Classical theory presents two streams:
i. Scientific management: It provides the real basis for the classical
theory of organisation. The important contributors are Robert Owen,
Charles Babbage, Henry Robinson, Frederick Winslow Taylor, Henry
Gantt, Frank B. Gilbreth and Lillian M. Gliberth, Mary Parker Foller,
and Charter J. Bernard.
ii. Administrative management: This theory focuses on managerial and
organisational problems. The administrative theorists were Weber,
Henry, Fayol, Gulick, Mooney, and Reiley.
b. Assumptions of classical theory:
i. The relationship between employee and employer, superior and
subordinate, and manager and worker is completely formal.
 ii. A worker is an economic man: The worker is treated basically as a
wage earner and can be motivated by money alone.
iii. Managers are rational: It was assumed that the traits of a manager
include - a rational approach, being kind-hearted, intelligent, and
honest.
iv. The organisation is a machine and employees are its components.
v. Emphasis on internal environment: Classical theory emphasizes on
internal factors neglecting the external environmental factors.
vi. Productivity centred: Classical theory is centered around productivity.
Workers perceive that their interests are best produced if they increase
the level of productivity.
vii. Emphasis on control: This theory emphasizes the detection of the
duration after they occur and correct or control them.
viii. Man is relatively homogenous: This theory assumes that man is
relatively homogenous, which is viewed while designing the jobs that
man cannot be modified.
ix. Centralization: It is assumed that the organisational system can be
integrated through the centralization of authority.
c. Pillars of the theory: According to Scott and Mitchell, the classical
organisational theory, the organisation is based on four pillars.
i. Duration of labour: Dividing the work into tasks and sub-tasks and
allotting each sub-task to an individual worker.
ii. Vertical and horizontal organisation: Vertical organisation is also
known as scalar process. In this, the number of supervisors is more as
the management believes the assumption of theory X.
iii. Structure: Structure implies a relationship among function, individuals,
materials, and machines in order to perform the operation and to
accomplish the goals. These relationships are divided into line and
staff relations.
iv. Span of management: Refers to the number of subordinates, the
supervisor can control effectively.
2. Neoclassical theory: Behavioural scientists investigate human behaviour at work.
They found that human behaviour is influenced by various factors other than
physiological reasons. The neoclassical approach to organisational design was
developed by Mary Parker Follet, Chester T. Barnard, Elton Mayo and his associates.
a. Facts discovered by Hawthorne studies: Mayo and his associates discovered
the following facts through their experiment:
i. The social system defines individual roles and establishes norms.
ii. Workers follow social norms rather than achieving goals.
iii. Non-economic rewards and social sanctions are addition to economic
rewards play a vital role in guiding human behaviour at work.
 iv. Perception of the workers of the situation rather than that of the
management matters much.
v. Workers fear retaliation for violating the group norms and therefore,
they are motivated by group norms rather than economic incentives.
vi. Individual worker’s attitudes and performance are shaped and
determined by the group. Workers are mostly treated as members of
groups but not as individuals. Workers prefer to change their behaviour
based on the change in group behaviour.
vii. Informal leader sets and enforces group norms.
viii. Workers have the need for communication, participation and
involvement in decision-making and democratic leadership.
ix. A higher level of job satisfaction leads to high-level organisational
effectiveness.
x. Managers should have social skills in addition to technical skills.
xi. Motivating the workers is possible by fulfilling not only lower-level
needs but also higher-level needs.
3. Contingency approach: According to Fremont and Kart and James E. Rozenzwerg,
the contingency view seeks to understand the interrelationship within and among
systems as well as between the organisation and environments and to define patterns
of relationships and configurations of variables. It emphasizes the multivariate nature
of organisations and attempts to understand how organisations operate under varying
conditions and in specific circumstances.
4. Challenging in vertical integration: Refers to the practice in which companies own
their own supplier and their own customer who purchase their product from them.
a. They find it difficult to balance their resources in the most effective manner,
providing exactly enough resources to be used in manufacturing and the right
number of finished products to be sold.
b. Since the company’s suppliers are internal, they don’t face competition to keep
their prices down; potentially resulting in higher costs for the company.
c. Because the various parts of the organisation are so tightly interconnected, it is
very difficult for the company to respond to changes, such as developing new
products.
5. Team-based organisation: An organisation in which autonomous work teams are
organized in a parallel fashion such that each performs many different steps in the
work process. In this approach, organisations are designed around processes instead
of tasks. For example, members of an advertising team may combine their different
skills and expertise and become responsible for all aspects of advertising.
6. Mintzberg’s framework (five structural configurations): Includes simple, machine
bureaucracy, professional bureaucracy, divisionalized form, and adhocracy. The five
test parts of the organisation, for Mintzberg, are the strategic apex; the middle level,
or middle line; the operating core, where work is accomplished, the technical staff or
the technostructure, and the support structure.
 Structural Prime The key part of the Type of
configuration coordinating organisation decentralization
mechanism

Simple structure Direct supervision Strategic apex centralization

Machine Standardization of Technical staff Limited horizontal

bureaucracy the work process decentralization

Professional Standardization of Operating level Vertical and

bureaucracy skills horizontal
decentralization

Divisionalized Standardization of Middle level Limited vertical

form outputs decentralization

Adhocracy Mutual adjustment Support Staff Selective

decentralization

● Strategic apex: Made up of direction/senior executive roles to define the

mission.
● Operating core: Cames out the activities necessary to deliver outputs.
● Middle line: Link between apex and core. The role in interpretation as work
of operating core has to be consistent with the expectations and plans of the
apex.
● Technical staff: Individuals and teams working in functions such as HR,
finance, and planning.
● Support staff: Outputs do not directly lead to core purpose.

Five structural configurations:

● Simple structure: Startups and businesses are people who perform all the
tasks. Centralized form of organisation. Small technical and support staff,
strong centralization of decision-making in the strategic apex, and a
middle-level, minimal formalization, direct supervision, chief executive in the
strategic apex. For example, in independent landscape practice, one or two
landscape architects supervise the vast majority of work with no middle-level
manager. Low departmentalization, a wide span of control.
● Machine bureaucracy: Decentralized form of organisation. It is a moderately
decentralized form of organization that emphasizes a support staff
differentiated from the line operation of the organisation, limited horizontal
decentralization of decision-making and a well-defined hierarchy of authority.
The technical staff is powerful in a machine bureaucracy. There is strong
formalisation through policies, procedures, rules, and regulations.
Coordination is achieved through the standardization of work processes. For
example, an automobile assembly plant with organized operating tasks.
 Hospitals exemplify professional bureaucracy, the expertise of doctors, nurses,
and technicians is emphasized as the operating core of the organization. The
strength of the machine bureaucracy is the efficiency of operation is a stable,
unchanging environment. The weakness of the machine bureaucracy is its
slow responsiveness to external changes and to individual employee
preferences and ideas (e.g.: Govt agencies).
● Professional bureaucracy: Highly trained professional so work is highly
specialized. It is a decentralized form of organisation that emphasizes the
expertise of professionals in the operating core of the organisation. The
technical and support staff serve the professionals. There is both vertical and
horizontal differentiation in the professional bureaucracy. Coordination is
achieved through the standardization of the professional bureaucracy.
Examples of organisations, where professional bureaucracies can be found, are
hospitals and universities. The doctors, nurses, and professors are given wide
latitude to pursue their work based on professional training and indoctrination
through professional training programs. Large accounting firms may also fall
into the category of a professional bureaucracy.
● Divisionalized form: This is a loosely coupled composite structural
configuration composed of divisions, each of which may have its own
structural configurations. Each division is designed to respond to the market in
which it operates. There is vertical decentralization from the strategic apex to
the middle of the organisation, and the middle level of management is the key
part of the organisation. This form of organisation may have one division
which is a machine bureaucracy, one that is an adhocracy, and one that is a
simple structure. The divisionalized organisation uses standardization of
outputs as its coordinating mechanism.
● Adhocracy: This is a selectively decentralization form of organisation that
emphasizes the support staff and mutual adjustment among people. It is
designed to fuse interdisciplinary experts into smoothly, functioning adhoc
project teams. Liaison devices are the mechanisms for integrating the project
teams through a process of mutual adjustment. There is a high degree of
horizontal specialization based on formal training and expertise. Selective
decentralization of the project teams occurs within the adhocracy. An
organisation of this form of organisation is the NATIONAL AERONAUTICS
AND SPACE ADMINISTRATION (NASA), which is composed of many
talented experts who work in small teams on a wide range of projects related
to America's space agenda. New high-technology businesses also often select
an adhocracy design. (e.g. film-making, consulting, J & J - divisional structure
units operate as adhocracies).

Five basic parts:

 ● The operating core: Employees who perform the basic work related to the
organisation's product or services. Examples include teachers, chefs and
waiters.
● The strategic apex: Top-level executives responsible for running the entire
organisation. Example include entrepreneur who runs their own small business
and general managers of automobile leadership.
● The middle line: Managers who transfer information between the strategic
apex and operating core. Examples include middle managers such are regional
sales managers (who connect top executives with the sales force).
● The technostructure: Those specialists are responsible for standardizing
various aspects of the organisation’s activities. Examples accountants,
auditors, and computer system analysts.
● The support staff: Individuals who provide indirect support services to the
organisation. Example includes consultants on technical matters, departments
like the canteen, cleaning, and maintenance.

Strategic Approach to Design Organisation:

For an organisation to satisfy its long-term plans objective factors have to be taken into
account. The conditions that must be met are referred to as contingency factors because the
organisation's ultimate success in implementing its strategies is contingent upon, meeting
these conditions.

1. Strategy: An organisation strategy refers to the particular objectives it has for the
future and how it plans to focus its business activities so as to create and sustain value
for the organisation.
a. Differentiation strategy: The company decides to market different products
to different groups of customers. (e.g. general motor - inexpensive to
expensive luxury cars).
b. Innovative strategy: An organisation selects its particular approach to
introducing innovations. There are two types of innovation strategies:
i. First-move strategy: Introducing the first new development to the
market. (e.g. Sony, Toshiba, Cola, Tesla, Netflix).
ii. Late-move strategy: A company might prefer to be less innovative by
manufacturing a product that already is known to be successful,
making some incremental change to it, and selling it more cheaply.
(e.g. Facebook, Pampers).
c. Low-cost strategy: A plan in which a business attempts to gain a large share
of a market by undercutting the prices of its competition (e.g. IKEA).
d. Market expansion strategy: The organisation seeks new opportunities to
increase sales by expanding into new markets, such as ones in other
geographic areas. For example, movie theatre rents out theatres during
business events, rather than for events, conference, and meetings.
 e. Risk reduction strategy: A strategy in which an organisation focuses on ways
of minimizing losses. For example, requiring workers on a construction site to
use safety equipment.
2. Contingency factors:
a. Size: Refers to the volume of work performed by an organisation. Example: in
the case of a manufacturing business, it might be the number of items
produced. In the case of a service business, it might be the number of
customers served.
b. Innovation: Refers to the introduction of new processes, in an organisation
within a particular period of time.
c. Diversification: Refers to the range of products, that an organisation
produces. If it produces only a few products, then diversification is low, but if
it produces many then it is high.
d. Geographic diversity: Refers to the degree to which a company finds it
necessary to have operations spread out over different locations.
3. Task qualities and coordination: Two particular task qualities are:
a. Task uncertainty: Refers to the degree of predictability that performing a task
a particular way will result in completing it successfully. The degree of
uncertainty encountered in any situation suggests that a particular coordination
mechanism can be used. These cases have different ways of governing how
things get done in an organisation. Four different coordination mechanisms
may be identified.
i. Govern by rules: These are specifications regarding what is supposed
to occur under certain conditions. For example: a rule might be put in
place stipulating that an employee who scores below a certain level of
proficiency be retained.
ii. Govern by plans: Refer to the schedule specifying who will do what
and when plans are particularly useful when uncertainty is moderately
low.
iii. Govern by hierarchy: Hierarchies are used in an organisation to
specify in advance exactly who is responsible for directing the
activities to specific others. It is useful when uncertainty is moderately
high because it allows for decisions to be measured by a person who
has more formal authority, and personally high expertise.
iv. Govern by mutual agreement: Refers to having individuals decide
among themselves exactly what each will do. Useful when uncertainty
is very high. The main reason for this is that it allows multiple people
to contribute to the task at hand, enhancing expertise that can be
brought to the situation.
b. Task interdependence: Refers to the degree to which two or more tasks are
connected to one another the greater the degree of connection, the more
closely they have to be coordinated.
 4. Structural or designed features: The effectiveness of organisational strategies
requires meeting certain conditions known as contingency factors. These are
facilitated when various structural characteristics are incorporated into the
organisational design.

Contingency factors Strategies are most effective when

The Size is large ● Specialization of labour is high

● Hierarchy is tall
● Decision-making is decentralized

Innovation rate is great ● Organic structure is used

● Many decisions are used
● Decision-making is decentralized

Geographic diversity is ● Division are based on geographic locations

high

Interorganisational Designs:

Interorganisational designs refers to plans by which two or more organisation come together.
Interorganisational design refers to designs that concentrate on the arrangement of units
within one organisation.

1. Boundaryless organisation: An organisation in which the chain of command is

eliminated, spaces of control are unlimited and rigid departments give way to
empowered teams. This term was introduced by Jack Welch, the former CEO of
General Electric. Two forms of boundaryless organisation are
a. Modular (networked) organisation: Business that outsource noncore
functions to other companies while focusing on their own core business. In
other words, they have a central hub and are surrounded by networks of
outside specialists that can be added a subtracted as needed. For example,
Reebok, it focuses on designing and marketing athletic shoes and but
outsources all production to companies in South Korea that specialize in
manufacturing. This allows the company to concentrate on what it does best
,-topping the changing tastes of its customers.
b. Virtual organisation: These are organisations composed of a continually
evolving network of companies linked together to share skills, costs, and
access to the market. They form a partnership to capitalize on their existing
talent pursuing common objectives that have been met, the organisation
distant. Corning (glass and ceramics manufactured) is an example of a
company that builds upon itself by developing partnerships with other
companies (including vitro).
2. Conglomerates: When an organisational diversities by adding an entirely unrelated
business or product to its organisational design may said to have formed
 conglomerates. For example, in Korea, companies such as Samsung and Hyundai
produce home electronics, automobiles, textiles, and chemicals in large, unified
conglomerates. These are all separate companies overseen by leaders in the same
parent company. In Japan, the same type of arrangement is known as keirestu.
Example: Matsushita group consists of a bank (Asahi Bank), a consumer electronics
company (Panasonic), and several insurance companies.

Companies form conglomerates for several reasons. As an independent business, the

parent company can enjoy the benefits of diversification, allowing a stable economic
outlook.

Between these two extremes are joint ventures these are arrangements, either
temporary or permanent, in which companies work together to fulfil opportunities that
require the capabilities of the other. Example: two companies might enter into a joint
venture if one has a valuable technology and the other has the marketing knowledge
to help transform that technology into a valuable commercial product. Microsoft GE
created a joint venture aimed at using data to improve healthcare quality and patient
experience.

3. Strategic alliance: It is a type of organisation design in which two or more separate

firms pan their competitive capabilities to operate a specific business. The goal of a
strategic alliance is to provide benefits to each individual could not be attained if they
operated separately.
a. The continuum of alliance: There exist 3 types of cooperative arrangements
between organisations. These may be arranged along a continuum from the
alliance that is weak and distant, at one end to those that are strong and close,
at the other end. At the weak end of the continuum are strategic alliances
known as mutual service consortia. These are arrangements between two
similar companies from the same or similar industries to pool their resources
to receive a benefit that would be too difficult or expensive for either to obtain
alone.

Example: high-tech capacity, such as an expensive piece of diagnostic

equipment that might be shared by two or more small, rural hospitals (MRI
unit).

At the opposite end of the scale are the strongest and closest types of
collaboration, referred to as value-chain partnerships. These are alliances
between companies in different industries that have complementary
capabilities. Example, customer-supplier, relationship.

The partnership between Cola and McDonald’s is enhanced by the fact both
companies are the leaders in their industry. Cola is the largest supplier and
 McDonald’s is Cola’s largest customer. Other potential facilitate include
shared competitors, prior history etc.

Because each company greatly depends on the other, each party’s commitment
to their mutual relationship is high. Example: Toyota.

Organisation Culture:

Basic nature:

Six fundamental aspects of culture are:

1. Formal definition
2. Key characteristics on which
3. Strength of organisation culture
4. Whether there is generally only one or more than one culture within an organisation
5. The role that culture plays in organisational functioning and
6. Various forms that culture takes.

Definition of organisational culture:

A cognitive framework consisting of attitudes, values, behavioural norms, and expectations

shared by organisation members.

A set of basic assumptions shared by members of an organisation.

Core cultural characteristics:

Six core characteristics are

1. Sensitivity to others: Years ago culture at UPS was relatively rejected and inflexible
with respect to customer needs. Today UPS culture places high value on service and
satisfaction.
2. Interest in new ideas: Walt Disney Company employees are cast members as they
are called have had lengthy orientation programs to ensure that they know exactly
what to say and how to behave toward guests.
3. Willingness to take risks: In some companies, the culture is very conservative. In
some other companies taking risks is valued.
4. Value placed on people: Toxic organisation culture refers to cultures in which people
feel that they are not valued. Healthy organisational culture refers to cultures in which
people feel that they are valued. Such cultures tend to have very low turnover and
generally abrive.

Characteristics of healthy organisation cultures:

● Everyone in the organisation is open and humble.

 ● Individuals are held accountable and accept personal responsibility for their
actions: By accepting responsibility conflict is lowered and opportunities for success
are raised.
● Within appropriate limits, people are free to take risk: Freedom exists to follow
new ideas.
● The commitment to doing things well is very high: Everyone is expected to do
things appropriately, not taking shortcuts to quality.
● Mistakes are tolerated because they are considered learning opportunities:
Failures are accepted because they provide opportunities to learn how to improve
things next time.
● Integrity is unquestionable: Efforts to promote integrity, such as transparency about
decisions and following up on promises are key.
● Collaboration and integration between units are organized: People work together
in open, friendly, and collaborative environments.
● Courage and persistence are encouraged: Work often is challenging. In a healthy
culture, everyone is encouraged to persist even in the phase of failure.
● Openness of available communication options: At some companies such as Yahoo
employees are expected to make decisions freely and to communicate with whoever is
needed to get the job done. The IVM culture has called for working within a proper
communication challenge.
● Friendliness and congeniality: In some companies such as Nokia Corperation, the
employees tend to get along well. Friendships often run deep and employees see each
other outside of the work.

Strength of organisational culture:

● Strong culture: Refers to an organisation in which there is widespread agreement

with respect to the core element of culture, making it possible for culture to exert a
major influence on the way people behave.
● Weak culture: Refers to an organisation in which there is limited agreement with
respect to the core elements of culture giving culture little influence on the way
people behave.

In an organisation with a strong culture, the core values are held in intensity and shared
widely. The more members accent these values and the greater their commitment to more
concepts, the stronger a culture may be said to be organisation with strong cultures are
characterized in the following ways:

● A clear philosophy exists about how business is to be conducted.

● Considerable time is spent communicating values and beliefs.
● Explicit statements are made that describe the organisation’s value.
● A set of values and norms exists that is shared widely and rooted deeply.
● New employees are screened carefully to ensure they fit with the culture.
Stronger organisation cultures are likely to be found in companies that are newer and that
have fewer employees.

The culture within the organisation:

Larger organisations usually have several cultures operating within them. Subcultures refer
to cultures existing within parts of the organisation rather than entirely through the. These
typically are distinguished with respect to either functional differences (that is type of work
done or geographical distances, that is the physical separation between people). Research
suggests that several subcultures based on occupational, professional, or functional divisions,
usually exist within any large organisation.

Dominant culture refers to its core values, the prevailing perceptions that are generally
shared throughout the organisation. Typically, members of subcultures who share additional
sets of values also usually accept the core values of their organisation or as a whole.

Role of culture in an organisation:

Culture plays an important role in the organisation.

● Culture provides a sense of identity: The more clearly an organisation’s shared

perceptions and values are defined, the more strongly people can associate with its
mission and feel a vital part of it.
● Culture generates commitment to an organisation’s mission: When there is a
strong, overarching culture, people feel that they are part of that larger, well-defined
whole and involved in the entire organisation’s work.
● Culture clarifies and reinforces the standard of behaviour: Culture guides
employees' words and deeds, and makes it clear what they should do and say in a
given situation, which is especially useful to newcomers. In this sense, culture
provides stability to behaviour.

Forms of organisational culture:

One of the most popular approaches in organisation and identifying the culture is known as
the competing value framework. According to this approach, the cultures of organisations
differ with respect to two sets of opposite values. They are;

1. Valuing flexibility and discern as opposed to stability order and continued.

2. Valuing internal affairs as opposed to what is going on in the external environment.

Unique organisational culture:

Four unique organisational cultures are;

1. Hierarch culture: Organisation described as having a hierarchy culture that has an

internal focus and emphasizes stability and control. (example: governmental agencies
and large corporations, military).
2. Market culture: The term market culture describes organisations that are concerned
with stability and control that are external in their orientation. In such an organisation,
the core values emphasize competitiveness and productivity, focusing on button-line
results. They do this by carefully identifying the market in which they are going to
compete and then taking a very hard-driving, results-oriented approach to getting
things done (for example: Amazon, and Tesla).
3. Clan culture: An organisation is said to have a clan culture when it has a strong
internal focus along with a high degree of flexibility. With goals that are highly shared
by members of the organisation and high levels of cohesiveness, such organisations
feel more like extended families than economic entities. (example: google).

In clan culture, the predominant focus is on flexibility when it comes to external

needs. This is attained by the core of the excellence of the employee, in which reflects
the internal focus. For example, the Nokia clan culture is often characterized as
enjoyable places to work. Organisation in which a great deal of attention to doing
things to make work fun for employees.

4. Adhocracy culture: Organisations that have an adhocracy culture emphasize

flexibility while also paying a great deal of attention to the environment. Adhocracy
culture is characterized by the recognition that, to succeed, organisation need to be
highly innovative and constantly assess what the future require for survival. For
example, software development companies and filmmaking business, where it is
widely recognized that highly innovative products and services are essential to
success. (example: Warner brothers)
How employees learn culture:

Employees learn from different models namely stories, rituals, materials, symbols, and
languages.

● Stories: Employees learn culture through stories.

● Rituals: Reliance conducts foundation day every year, where the CEO of the
company rewards the employees for their best performance, best customer relations
etc. This helps to reinforce company values, goals and future benchmarks. All the
family members of all employees participate in the events and interact with other in
the whole day celebration.
● Material symbols: Some companies provide various facilities to the employees like
cars, telephones, elegant furniture, and executive premises. Those facilities are called
material symbols.
● Languages: Refers to the technical jargon used by the business to dexter people,
equipment, customers etc.

Creating a positive organisation culture:

Emphasize building and employee strength, reward more than it punishes and emphasize
individual vitality and growth.

● Building an employee's strengths: Emphasis on how employees can capitalize on

their strengths.
● Rewarding more than punishing: Although most organisations are sufficiently
focused on extrinsic rewards such as pay and promotion, they often forget about the
power of smaller rewards such as praise.
● Emphasizing vitality and growth: A positive organisation culture supports not only
what the employee contributes to organisation effectiveness but also how the
organisation can make the employee more effective.