Organizational behavior 7e by luthans chap003

Chapter Three

Organizational
Context: Design and
Culture

McGraw-Hill/Irwin

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Learning Objectives
• Explain the organization theories of open systems,
information processing, contingency, ecology, and
learning.
• Present the modern horizontal, network, and virtual
designs of organizations.
• Define organizational culture and its characteristics.
• Relate how an organizational culture is created.
• Describe how an organizational culture is
maintained.
• Explain some ways of changing organizational
culture.


Introduction
• Organization structure represents the
skeletal framework for organizational
behavior.
– Consists of very flexible networks.
– Recognizes the interaction of information

technology and people.

• Cultural context that the organization
provides for organizational behavior.


Organization Theory
• Historical roots - Chester Barnard.
– Cooperative system is contingent on the
human participants’
• Ability to communicate
• Willingness to serve
• Strive toward a common purpose

• Organization as an open system
– input → transformation process → output


Organization Theory
Continued

• Information processing view of
organizations
– External and internal uncertainties.
– Become a networked, information processing
systems.

• Contingent and ecological organization
theories
– Learning organization represents the latest

thinking in organization theory and compatible
with the new paradigm environment.


Organization Theory
Continued

• A learning organization
– Single loop learning
– Double loop learning

• Organizational behavior in the learning
organization.
– Associated with employees’ reacting to
environmental changes and characterized by
human-oriented cultural values.

• Learning organizations in action.


Characteristics of Learning Organizations


Traditional versus Learning Organizations


Modern Organization Designs
• Horizontal organizations
– Relevant to today’s environmental needs for flexibility,
speed, and cooperation.

• Network designs
– Involves a unique combination of strategy, structure,
and management processes.

• Virtual organization
– Temporary network of companies that come together
quickly to exploit fast-changing opportunities.


Traditional Hierarchical versus the
Network Organization


The Contrast Between the Hierarchical
and Network Organization


Example of a Virtual Organization


Organizational Culture Context
• Definition and characteristics
– Recognize the importance of shared norms
and values that guide organizational
participants’ behavior.

• Uniformity of culture
– Organizational culture, a common perception
held by the organization’s members.

• Dominant culture
• Subculture


Creating and Maintaining a Culture
• How organizational cultures start
– Common steps include the formation of an
idea, a core group, action plan, and
implementation.

• Maintaining cultures through steps of
socialization
– Selection of entry-level personnel
– Placement on the job
– Job mastery


Steps of Organizational Culture
Socialization


Creating and Maintaining a Culture
Continued

• Maintaining cultures through steps of
socialization (continued)
– Measuring and rewarding performance
– Adherence to important values
– Reinforcing the stories and folklore
– Recognition and promotion

Creating and Maintaining a Culture
Continued

• Changing organizational culture
– Case of mergers and acquisitions
• Focus areas: structure, politics, and emotions.

– Case of emerging relationship enterprises
• Success dependent on trust, communication, and
negotiation skills.

– Guidelines for change
• Caution: pragmatically changing an organizational
culture affects almost every aspect of the
business.


Questions