Understanding and Managing Organisational Culture
Organisational culture is a widely used term but one that seems to give rise to a degree of ambiguity in terms of assessing its effectiveness on change variables in an organisation. For the past number of decades, most academics and practitioners studying organisations suggest the concept of culture is the climate and practices that organisations develop around their handling of people (Schein, 2004). Watson (2006) emphasises that an important trend in managerial thinking in recent decades has been one of encouraging managers to try to create strong organisational cultures. Schein (2004) suggests that culture and leadership are conceptually intertwined. This is supported by O’Farrell (2006) in his analysis of the Australian public service, where he concludes that ‘statements of values, codes of conduct, principles of public service management and so on set out in rules and regulation are simply rhetoric – or what we now call aspirational statements. Without leadership that is what they will ever be rhetoric. It is our job as administrators, managers and leaders to turn them into reality’ (O’Farrell, 2006. p.8).
This study reviews evidence that shows why managing culture is important to effectively enhancing both organisation performance and, in macro terms, the public service modernisation programme. Based on the national and international literature reviewed and interviews conducted, guidance is provided in relation to more effectively managing culture, and issues to be addressed in terms of its effective engagement and use in the public service are outlined.
Why is culture an important issue for public service managers?
Why should public service managers concern themselves with culture? Will it make any difference at the end of the day to know what type of culture or subcultures exist in an organisation, what cultural traits may be desired, and so on? For managers with busy schedules, is culture something they should be concerned with?
The evidence presented here, from the literature, international studies and the Irish experience, suggests that culture is indeed something that public service managers should pay attention to. First and foremost, this is because culture affects the performance of organisations. In the private sector organisations studied – The Hong Kong and Shanghai Banking Corporation and 3M – there is a clear and explicit link between culture change and performance. But this can also be the case in the public sector, despite the absence of a ‘bottom line’. Ban’s (1995) study of the good performance of the US Environmental Protection Agency compared to other federal agencies, cited in Chapter 2, shows how culture can affect performance. The Irish cases studied, such as the Broadcasting Commission of Ireland (BCI) and the Property Registration Authority (PRA) would also suggest that attention paid to culture influences performance in a positive manner.
The evidence from this study would also suggest that it is particularly important for managers to pay attention to culture when reacting to or planning major organisational change. Culture is particularly important when an organisation is undergoing significant transformation or when introducing major reforms which require different or new cultural or value traits from those exhibited in the past.
What can managers do to influence/shape culture? Knowing that culture is important in shaping organisational practice and performance in public sector organisations is one thing. But a subsequent issue is the extent to which managers can actually shape or influence culture. The literature on culture change explored in Chapter 2 is somewhat ambivalent on this point. On the one hand, examples can be identified where interventions can influence culture. But on the other hand, some academics warn of the danger of attempting to influence the more superficial aspects of culture such as symbols and ceremonies, while ignoring the more pervasive and deep seated aspects of culture such as values and beliefs. These more deep seated aspects of culture are much more difficult to influence.
Six key issues
Based on the academic literature in this study and the findings from the interviews, Chapter 5 sets out a framework that identifies six key issues that managers need to address in order to contribute to creating a more developmental and performance oriented culture in their organisation. These issues are as follows:
Creating a climate for change
In terms of creating a climate for change, culture is only effective if it is applied to the relevant area needing change or is tied to some organisational issue. Several of the organisations studied here used internal or external drivers in order to facilitate the culture shift they wanted to see achieved. For example, the UK civil service at the ‘unfreezing’ stage of their change programme created a climate where civil service change to a more managerial culture was seen as required in order to address long standing problems. The Department of Education and Science uses the social partnership agreements as a framework within which to promote change. BCI has used its organisational development policy as the driver for developing the organisation’s culture in the desired direction. Leaders as champions
Leadership is clearly important in determining the effectiveness of culture change. The leaders of organisations are ‘champions’ of understanding and managing culture in the organisation and of rewarding or punishing subcultures depending on whether they align or not with the corporate culture espoused by the leaders. The influence of leaders in terms of rewarding the sub-culture groups that espouse the dominant beliefs, values and underlying assumptions of the organisation cannot be underestimated. This is demonstrated, for example, in Queensland Health, 3M and the Department of Arts, Sport and Tourism where significant emphasis has been put on leadership development programmes and initiatives. The local authority examples illustrate that clear strategic leadership is necessary to ensure the consistency of organisation culture.
Employee engagement and empowerment
Employee engagement and empowerment is crucial to ensure that the culture is effectively managed and aligned with the cultural assumptions of the organisation as a whole. Demonstration projects in the UK civil service, which promoted the desired managerial thinking and at the same time engaged staff in the change process, were an important element in cultural change. Local partnership committees and projects in BCI and the PRA have been used to engage and empower staff, though each recognises that partnership arrangements need careful management if they are to be successful.
Team working was a common feature in most organisations studied, in terms of crossing existing barriers and as a useful means of promoting and disseminating new cultural traits. In terms of individual and organisational development, teams are seen as a way of investing in talent development. HSBC, for example, put particular emphasis on team projects rooted in the promotion of the desired core values for the organisation. The Carlow County Council case highlights a further dimension of team orientation – the benefits of developing joint team working with individuals and businesses outside the organisation to help shift the focus to the promotion of a developmental culture. Similarly, Carlow County Council, Donegal County Council and South Dublin County Council emphasise a culture of cross-agency and cross-functional collaboration and teamwork with public bodies and agencies in developing more effective provision of services at a local level.
Tracking cultural change
Tracking cultural change is important in terms of assessing whether the culture has become misaligned in terms of sub-group cultures’ practices, or whether there are issues or challenges to be addressed which could undermine the cultural ethos and underlying assumptions of the organisation. In the US, the Organisational Culture Assessment Instrument (OCAI) has been used to good effect in some federal agencies. BCI undertook an organisational culture mapping exercise.