Measuring organic and mechanistic cultures

Introduction

Some of the challenges that make organizational culture significant today include downsizing, budget cuts, globalization, and the rapid rate of technological improvements. Kanter (1983) states that to manage change in an organization requires that people find their stability and security in the culture and direction of the organization.

Studies show that the type of culture an organization exhibits affects employee retention. One study indicated that new employees voluntarily stayed 14 months longer in cultures emphasizing interpersonal relationship values than in cultures emphasizing work task values (Sheridan, 1992).

Denison performed a study indicating that companies with a participative culture reap a return on investment that averages nearly twice as high as in firms with less efficient cultures (Denison, 1984). An effective organizational culture is a key component influencing an organization's ability to compete and to succeed long term (Morris, 1992). Lack of insight into culture leaves managers vulnerable to forces of evolution and change which they may not understand and which they may have difficulty controlling (Schein, 1992).

Existing organizational culture measurement tools measure one element of culture or certain organizational characteristics. However, they are not based on all culture elements as defined in engineering management literature.

The purpose of this study is to develop a tool to measure culture as defined by the leading authors in engineering management literature. The OCA measures organizational culture and provides a five-dimensional score, one for each of five culture elements.

Culture Definitions

Organizational culture is defined by numerous authors. Some of the significant definitions related to engineering management are:

Ott (1989) and Westbrook (1993) define organizational culture as a function of language, artifacts and symbols, patterns of behavior, basic underlying assumptions, and subcultures.

Culture is formally defined by Schein (1992, p. 12) as "a pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems."

Ouchi (1981) states that organizational culture consists of a set of symbols, ceremonies, and myths that communicate the underlying values and beliefs of an organization and its employees.

Rogers and Ferketish (1993) state that an organization's culture is based on the shared values reflected in the behaviors of leaders and employees at every level. The answer to the question "What's important around here?" provides positive or negative insight into what is valued in an organization.

Dyer (1985) describes organizational culture as artifacts, perspectives, values, and assumptions shared by members of an organization. He defines artifacts as verbal (language, stories, myths), behavioral (rituals and ceremonies), and physical (art, attire, layout, and technology). Perspectives are the socially shared rules and norms applied in given situations. Values are the evaluations people make of situations, acts, objects, and people. They represent the organization's goals, ideals, and standards. Assumptions are the implied beliefs that underlie the overt artifacts, perspectives, and values.

Blake and Mouton (1969) describe corporate culture as the routine ways of doing things that people accept and live by. Organizations have norms and values that influence how members conduct themselves. These norms may prevent members from applying a maximum effort or may encourage them to do so.

Culture Elements. Based on the culture definitions above, along with others, an author matrix of common culture elements was developed. The author matrix yielded the following five culture elements:

Language-The language of an organization communicates its culture (Westbrook, 1993). Examples of how language is used in organizations include jargon, metaphors, myths, slogans, ceremonies and celebrations, and heroes and heroines (Deal, 1985).

Tangible artifacts and symbols-Artifacts and symbols provide tangible evidence of the culture (Westbrook, 1993). Artifacts are objects manufactured by people to facilitate culturally expressive activities (Trice and Beyer, 1984). Symbols or company logos often summarize or condense what a company stands for (Deal, 1985).

Patterns of behavior, rites and rituals, behavioral norms-- Trice and Beyer (1984) define a ritual as a standardized, detailed set of techniques and behaviors that manage anxieties but seldom produce intended, technical consequences of practical importance.

Allen (1985) describes norms as encompassing all behavior that is expected, accepted, or supported by the group, whether that behavior is stated or unstated. The norm is the sanctioned behavior, and people are rewarded and encouraged when they follow the norms, and ostracized when they violate them. Schein (1992) defines group norms as the implicit standards and values that evolve in working groups, such as the norm of "a fair day's work for a fair day's pay" that evolved among workers in the bank wiring room in the Hawthorne studies.

Espoused values-Schein (1992) defines espoused values as the articulated, publicly announced principles and values that the group claims to be trying to achieve, such as "product quality" or "price leadership."

Beliefs and underlying assumptions-Basic underlying assumptions of an organization are revealed in management decisions, policies, and procedures. McGregor's Theory X and Theory Y describe management's underlying assumptions about employees. Theory X managers assume the existence of only the culture that exists in top-management circles. They believe employees' behavior must be directed, motivated, controlled, and modified by management to prevent passivity. Theory Y managers recognize work group differences and understand that different groups may have different subcultures. They believe their task lies in allowing employees to achieve their own goals by directing their own best efforts toward organizational objectives (McGregor, 1960).

Organic and Mechanistic Characteristics. Burns and Stalker (1961) used the terms organic and mechanistic to define organizational structure as shown in Exhibit 1.

Their studies identified that mechanistic structures are designed for stable environments while organic structures are better suited for changing and innovative environments. Organic and Mechanistic Cultures. The terms organic and mechanistic describe culture as well as organizational structure. Exhibit 2 shows organic and mechanistic characteristics for each culture element.

Organizational Culture Assessment

The five culture elements and their definitions were used to develop the OCA. The OCA is a 45-question survey, divided into five sections, one for each culture element. Each question in the survey is answered by marking one of eight answers on a Likerttype scale with two possible answers in each of the following four categories: strongly agree, somewhat agree, somewhat disagree, or strongly disagree.

The OCA score for an organization is determined by averaging the answers for all survey participants. The score can range from 1.0 to 8.0. A score closer to 1.0 represents a mechanistic type of culture. A score closer to 8.0 represents an organic type of culture. A similar assessment can be made for each culture element.

Results

Thirty high-technology organizations were surveyed, with a total of 275 individual participants. Sixteen organizations had sufficient data to perform analysis at the organizational level. Each survey participant completed the OCA, the Likert Profile of Organizational Characteristics (POC-used for OCA validation), and a demographics section. Exhibit 3 shows a graph of the OCA and Likert POC scores for the 16 organizations.

Reliability

A reliable survey is consistent in what it measures. The type of reliability used is internal consistency reliability. Internal consistency uses a single survey to determine the degree to which the questions in the survey are measuring the same thing. The methods used for measuring internal consistency are split-half reliability and Cronbach's alpha.

Validity

A valid survey measures what it is intended to measure (Litwin, 1995). Concurrent validity is used to analyze validity. Analyses were conducted on survey participants' opinion of the culture from the demographics form. An examination ofthe organizations surveyed was also performed.

Concurrent Validity. Concurrent validity requires a survey have empirical association with some criterion or "gold standard" (DeVellis, 1991). This requires identification of an established, generally accepted test (Litwin, 1995). A high correlation coefficient between the survey and the standard test suggests good concurrent validity.

To validate the OCA, the results were compared to the Likert POC, Short-Like-Machine-Form (copyright 1978). Rensis Likert Associates, Inc. is no longer in business. However, permission to use the Likert POC was granted by Rensis Likert's daughter, Ms. Patricia Pohlman.

Likert describes an organizational theory of a continuum of four management systems (Likert and Likert, 1976). System I is an exploitive authoritative system. Managers use threats and punishment for motivation. In System 2, the benevolent authoritative system, managers use rewards along with punishment to motivate. In System 3, the consultative system, managers use less punishment and more rewards and involvement as motivating techniques. In System 4, the participative group system, managers use high levels of group involvement and group-developed reward systems to motivate.

The POC can determine where organizations fall in the Likert System 1 to 4 continuum. The version of the survey used consists of 16 questions on an eight-point scale. The POC version used is divided into the following six sections: leadership, motivation, communication, decisions, goals, and control. The POC measures slightly different aspects of culture than the OCA, however, it has been extensively used to measure organizational characteristics and was considered similar enough to the OCA to be of use.

The correlation between the OCA data and the Likert POC data is .95 (Exhibit 5). An analysis of variance produced a significant F-value of .000, indicating that the OCA and the Likert POC are related. Analysis of the residuals indicated the errors are normally distributed and that the order of the model is correct. The high correlation and the ANOVA indicate that the OCA has high concurrent validity.

Participant Culture Opinion. An additional analysis was performed to further validate the OCA. The participants' culture opinions of their organizations were collected in the demographics section of the survey. They were asked whether their organization was viewed as very negative, negative, neutral, positive, or very positive. The organizations surveyed were high technology, so a very negative culture opinion corresponds to a mechanistic culture (low OCA score) and a very positive culture corresponds to an organic culture (high OCA score). The culture opinion was converted to a five-point scale, where 1 represents a very negative culture opinion and 5 represents a very positive culture opinion.

Exhibit 6 shows a comparison of the organization OCA scores to the culture opinions. The figure shows the OCA scores resemble the culture opinions for each organization surveyed. The correlation between the OCA scores and the culture opinion is .82. Therefore, it can be concluded that culture opinion is related to the OCA score and this relationship further validates the OCA.

Organization Analysis. Another way to analyze the validity of the OCA is to examine the organizations surveyed. The organizations with OCA results in the organic range also happen to have reputations for being innovative, flexible, and having loose organizational structures. The management of one of the organic organizations used the survey results to implement changes, improving an already organic score. The organization's administrator indicated management's intent to use the survey throughout the organization to examine and improve the culture.

On the other hand, organizations scoring in the mechanistic range of the OCA have reputations for being bureaucratic, rigid, and rules oriented. Many are government organizations and government support contractors. No reports of the survey being used to study or improve these organizations' cultures were received.

Culture Types

The OCA data were analyzed to determine whether it falls into groups. The data appeared to fall into four subsets (Mechanistic, Mechanistic-Organic, Organic-Mechanistic, and Organic) as shown in Exhibit 7.

The boxplot for the four culture types is shown in Exhibit 8. The plot shows that the medians of the culture types differ.

A one-way analysis of variance was performed to test the hypothesis that all the culture type means are equal. The observed significance level is .000, so the null hypothesis that all the means are equal is rejected. Therefore, there is a significant difference in the culture type means. A Levene test for homogeneity of variances was performed to determine whether the group variances are equal. The significance level is .538. Since the significance level is large, the null hypothesis that the variances are equal cannot be rejected. Therefore, the assumptions required for the ANOVA have not been violated.

TheANOVA does not indicate which means are significantly different from each other. Therefore, a Duncan's multiple range test was run to compare all possible pairs of means. The results of the Duncan's multiple range test with a significance level of .05 indicate that each pair of means differs significantly (Exhibit 9). Based on the test results, it can be concluded that the culture type model is adequate.

Conclusions and Recommendations

The intent of this study was to develop an instrument to measure organizational culture. Data was collected from 275 participants from 30 organizations. The results of the analysis show evidence that (1) the OCA is a reliable survey and is valid for measuring organizational culture, and (2) there are four types of organizational culture.

Implementing the OCA. Managers in high-technology organizations should perform investigations using the OCA to determine whether their organizations have organic or mechanistic cultures. When the results are tabulated, managers will have an overall OCA score for their organization, as well as a score for each of the five culture elements. Managers should then decide whether the score is appropriate for their environment.

Culture Type Change Initiatives. If there is a need to change the culture type, responses to individual survey questions can be examined and initiatives implemented in an attempt to improve the culture score. Although the following ideas are not part of the research, some examples of change initiatives are shown below:

* Minimize the use of jargon

* Refrain from using derogatory terms for management, nonmanagement, and customers

* Praise employees for going to extremes to get the job done

* Managers should have an open-door policy

* Managers and non-managers should dress similarly

* Employees should have comfortable work areas with updated computer equipment

* Celebrate work accomplishments

* Managers should focus on work performance rather than office hours

* Managers should encourage employees to be open-minded and work together to solve problems

* Managers should focus on quality of work instead of quantity of work

* Managers should encourage innovative ideas and quickly adapt new technologies

* Managers should praise good performance and offer training opportunities

* Managers should provide support to employees to reach organizational goals

* Managers should assume that employees are responsible, capable, and vital organizational assets

* Decision-making should be pushed down to lower levels in the organization.

After initiatives have been implemented, then the OCA should be administered again. This post-initiative study can be used to determine the impact of the change initiatives.

As technology continues to expand throughout the world, an organic organizational culture will become increasingly important. In order for organizations to compete in the marketplace, a strong emphasis must be placed on developing a clear understanding of organizational culture and its impact on employees and organizational success.