©2007 The McGraw-Hill Companies, Inc.

, All Rights Reserved

 Chapter Four

Social Systems
and Organizational Culture
 Chapter Objectives

 To understand:
• The operation of a social system
• The psychological contract
• Social cultures and their impact
• The value of cultural diversity
• Role and role conflict in organizations
• Status and status symbols
• Organizational culture and its effects
• Fun workplaces
 Cultural Cues

 Direct Cues
• Orientation training
• Policy statements
• Advice from supervisors and peers
 Indirect Cues
• Inferences made from promotions
• Patterns of acceptable dress
 Understanding a Social System

 Social System
• Complex set of interacting human relationships
• All parts are mutually interdependent
• Engages in exchanges with its environment
(open system)
 Social Equilibrium

 When all interdependent parts are in dynamic

working balance
• A single event can throw a system out of balance
• When in disequilibrium, the parts work against
each other
• Over time, the basic character changes little
 Functional and Dysfunctional Effects

 Functional effects…
• Creativity
• Productive employees
• Quality improvements
 Dysfunctional effects include…
• Lower productivity (hard)
• Lower satisfaction (soft) To elicit functional
behaviors, provide
• Lower commitment (soft) clear expectations
and promises of
reward
Psychological and Economic Contracts
 Psychological and Economic Contracts

 The psychological contract builds upon the

concept of exchange theory
• To remain attracted to the
relationship, both parties must
have a net positive ratio
• The contract is continually
examined and revised
 Social Culture

 Acting in accordance with the expectations of

others
• Human-created beliefs, customs, knowledge,
and practices
• Distinctive social cultures can exist within a
single nation
 Managers must understand and appreciate the
backgrounds and beliefs of work unit members
• One-culture dependency may create intellectual
blinders
 Cultural Diversity

 Job-Related Diversity
• Type of work
• Rank
• Physical proximity
• Group affiliation
 Non-Job-Related Diversity
• Culture
• Ethnicity
• Socio-economics
• Sex
 Cultural Diversity

 Discrimination and Prejudice

• Discrimination is generally an action
• Prejudice is an attitude
• Either may exist without the other
 The law prohibits…
• Actions, not feelings
• Any action that has discriminatory results,
regardless of intentions
 Cultural Diversity

 Valuing Diversity
• Prejudicial stereotypes
• Differences must be recognized, acknowledged,
appreciated, and used to collective advantage
• Organizations are under political, economic,
social, and technical pressures to change
• Actively managing diversity provides a
competitive advantage
 Social Culture Values

 The Work Ethic

• Group differences
• Gradual decline
 Social Responsibility
• Costs and benefits
• Strive for balance
• Social, economic, and technical values
 Role

 A pattern of expected actions

• Facilitates interaction
• Multiple roles
Role Perceptions
 Mentors

 A role model who guides another employee

• Stronger employee loyalty
• Faster movement up learning curve
• Better succession planning
• Increased level of goal accomplishments
 Assigning mentors can result in…
• Resentment
• Abuse of power
• Unwillingness to serve
 Role Conflict

 Others have different perceptions or

expectations of a person’s role
• Boundary roles
• Role ambiguity
 Status

 Social rank of a person in a group

• Status systems
• Status anxiety
• Status deprivation
• Status relationships
• Status symbols
Sources of Job Status
 Status

 Significance of Status
• Influences transfers and jobs employees take
• Helps determine informal leaders
• Motivates those seeking to advance
• Some societal backlash
 Organizational Culture

 Complex social system of laws, values, customs

• Behavior = Interaction between personal
characteristics and the environment
• Shared norms
 Benefits of Organizational Culture
• Provides organizational identity
• Source of stability, continuity, security
• Provides context
• Typically identifies and rewards high-producing
and creative individuals (role models)
 Characteristics of Organizational Culture

 Distinctive
 Stable
 Implicit
 Symbolic No single
 Integrated type of
culture is
 Accepted best
 Reflection of top management
 Subcultures
 Varying strength
 Measuring Organizational Culture

 Difficult at best…
• Examination of stories, symbols, rituals, and
ceremonies
• Interviews and open-ended questionnaires
• Examination of corporate philosophy statements
• Become a member of the organization and
observe
 Communicating and Changing Culture

 Culture is communicated through…

• Formal communication channels
• Informal means
• Unintentional ways
• Storytelling
 People are more willing to adapt and learn when
they want to…
• Please others
• Gain approval
• Learn about their work environment
 Communicating and Changing Culture

 Organizational Socialization
• Continuous process of transmitting key elements
of an organization’s culture to its employees
• Formal and informal means
• Storytelling
 Individualization
• Employees exert influence on the social system
around them by challenging the culture or
deviating from it
Socialization and Individualization
Methods for Changing Organizational Culture
 Fun Workplaces

 Key Features
• Easily recognized
• Means different things to various people
• Is relatively easy to create
• Elicits a broad range of personal and
organizational payoffs
 Fun Workplaces

 Benefits…
• Decreases stress
• Reduces boredom
• Stimulates friendships
• Increases satisfaction
• Produces beneficial physiological results