19 Organizational Culture and Climate

19.1 What is Organisational Culture?

Organisational culture is the system of shared meanings held by members of an organisation that distinguishes the organisation from others. The classroom shorthand: “the way we do things around here.” It is how a Tata company is recognisably different from a Reliance company even when both have similar org charts and financials.

Edgar Schein, the discipline’s founder, defines it 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” (schein2010?). Stephen Robbins offers the more compact textbook version: “a system of shared meaning held by members that distinguishes the organisation from other organisations” (robbinsjudge2018?).

Three Working Definitions

Author	Definition	What it foregrounds
Edgar Schein	“Pattern of shared basic assumptions learned in solving problems of adaptation and integration.”	Learning, depth
Stephen Robbins	“System of shared meaning held by members that distinguishes the organisation.”	Meaning, distinctiveness
Geert Hofstede	“The collective programming of the mind which distinguishes one organisation from another.”	Mental programming

19.1.1 Seven primary characteristics (Robbins)

Seven Primary Characteristics of Organisational Culture (Robbins)

Characteristic	What it captures
Innovation and risk-taking	How much employees are encouraged to be innovative
Attention to detail	How much precision and analysis is expected
Outcome orientation	Focus on results vs the techniques to achieve them
People orientation	Effect of decisions on people inside the firm
Team orientation	Work organised around teams rather than individuals
Aggressiveness	How aggressive and competitive members are
Stability	Maintaining the status quo vs growth

19.2 Schein’s Three Levels of Culture

The most-used framework in OB. Already met in topic 14; here is the deeper treatment (schein2010?).

Schein’s Three Levels

Level	What it is	Visibility	Example
Artefacts	Visible structures, behaviours, language, dress, office design	Easy to see, hard to interpret	Open-plan office, casual dress, T-shirt with the logo
Espoused values	Stated strategies, philosophies, mission, code of ethics	Explicit	“Customer first” written on the wall
Underlying assumptions	Unspoken, taken-for-granted beliefs	Invisible	“We never lie to the customer” — held without discussion

flowchart TB
  A[Artefacts<br/>Visible — what we see] --> V[Espoused Values<br/>Stated — what we say]
  V --> U[Underlying Assumptions<br/>Invisible — what we actually believe]
  style A fill:#FCE4EC,stroke:#AD1457
  style V fill:#FFF8E1,stroke:#F9A825
  style U fill:#E3F2FD,stroke:#1565C0

A culture is strong when the underlying assumptions are deeply held, broadly shared and consistent with the espoused values; weak when artefacts and values diverge from underlying behaviour.

19.3 Strong vs Weak Cultures

Strong vs Weak Culture

Feature	Strong	Weak
Sharing	Most members share core values	Values held by a few
Intensity	Held with conviction	Held lightly
Consistency	Espoused values match underlying behaviour	Mismatch between values and behaviour
Effect	Predictable behaviour, lower turnover, can be a source of advantage	Variable behaviour, high turnover, easier to change

A strong culture is not always good. If the dominant assumptions become out of step with the environment (Kodak, Nokia), strength becomes rigidity.

19.4 Types of Organisational Culture

19.4.1 Charles Handy’s four cultures

Charles Handy identified four cultural archetypes — borrowing names from Greek mythology (handy1993?):

Handy’s Four Cultures

Culture	Symbol	Description	Common in
Power (Zeus)	Spider’s web	Power radiates from a central figure; few rules	Small firms, family businesses
Role (Apollo)	Greek temple — pillars	Bureaucratic; defined roles, procedures	Government, large corporations
Task (Athena)	Net	Project-based; expertise rules	Consulting, R&D firms
Person (Dionysus)	Cluster of stars	Individuals are the centre; minimal structure	Law partnerships, doctors’ groups

19.4.2 Cameron and Quinn’s Competing Values Framework (OCAI)

Kim Cameron and Robert Quinn’s Competing Values Framework uses two axes — flexibility vs stability and internal vs external focus — to derive four culture types, measured by the Organisational Culture Assessment Instrument (OCAI) (cameronquinn2011?):

Cameron-Quinn’s Four Culture Types (OCAI)

Type	Axes	Focus	Cue
Clan	Flexibility + Internal	Family-like, mentor leadership	Loyalty and tradition
Adhocracy	Flexibility + External	Dynamic, entrepreneurial	Innovation and risk
Hierarchy	Stability + Internal	Formal, structured	Predictability
Market	Stability + External	Results-oriented, competitive	Goal achievement

19.5 How Culture is Created and Sustained

Schein identifies founders as the original source of culture — Tata’s J.N. Tata, Infosys’s N.R. Narayana Murthy, Amazon’s Jeff Bezos. Once formed, culture is sustained through three forces (Robbins):

Three Sustaining Forces

Force	How it keeps culture alive
Selection	Hiring people whose values fit
Top management	Modelling and rewarding the values
Socialisation	Onboarding new members into “how we do things”

19.5.1 Socialisation — Van Maanen and Schein’s three stages

Three Stages of Socialisation

Stage	What happens
Pre-arrival	Expectations formed before entry — through recruitment, signalling
Encounter	New employee meets the reality; values are tested
Metamorphosis	Internal change — the new member embraces the culture (or leaves)

19.5.2 Transmitters of culture

Stories, rituals, material symbols and language. Tata’s stories about looking after employees during the 26/11 attacks; Infosys’s daily morning meeting; the dress code at McKinsey; the term “Googler”.

19.6 Functions and Dysfunctions of Culture

What Culture Does

Functions	Dysfunctions
Provides identity and boundary	Resistant to change
Generates commitment beyond self-interest	May reject diverse hires
Enhances stability of the social system	Can fuel groupthink and rigidity
Acts as a control mechanism — guides behaviour	May tolerate unethical sub-cultures

19.7 Organisational Climate

If culture is the deep, slow-moving DNA of the organisation, climate is the visible, current weather. Climate is the shared perception members have of the organisation’s policies, practices and procedures as they exist now (schneiderbartelhastrom2013?).

Climate vs Culture

Feature	Culture	Climate
Depth	Underlying assumptions and values	Surface perceptions
Time horizon	Stable, slow to change	Variable, can shift in months
Discipline	Anthropology, sociology	Industrial / organisational psychology
Measurement	Qualitative (interviews, observation)	Quantitative (surveys)
Examples	“We always tell the customer the truth”	“My boss recognised my work last week”

19.7.1 Litwin and Stringer’s six climate dimensions

George Litwin and Robert Stringer’s six-factor model is widely tested in Indian OB texts (litwinstringer1968?):

Litwin & Stringer’s Six Climate Dimensions

Dimension	What it captures
Structure	Sense of constraint, rules, red tape
Standards	Emphasis on quality and high performance
Responsibility	Feeling of being one’s own boss
Reward	Equity and adequacy of rewards
Support	Helpfulness of managers and peers
Commitment	Pride and loyalty to the organisation

A positive climate is associated with higher performance and lower turnover; the climate is largely shaped by leadership style.

19.8 Practice Questions

Q 01 Schein Easy

In Edgar Schein's three-level model of organisational culture, the visible level is:

AArtefacts
BEspoused values
CUnderlying assumptions
DMission statement

View solution

Correct Option: A

Schein's order: Artefacts (visible) → Espoused values (stated) → Underlying assumptions (invisible).

Q 02 Handy Medium

In Charles Handy's classification, a culture symbolised by a "Greek temple" with defined roles and procedures is:

APower culture
BRole culture
CTask culture
DPerson culture

View solution

Correct Option: B

Handy's Role culture (Apollo) — bureaucratic, rule-bound, large corporations and government.

Q 03 OCAI Medium

Match Cameron & Quinn's culture types with their orientation:

(i)	Clan	(a)	Stability + External — results-oriented
(ii)	Adhocracy	(b)	Flexibility + Internal — family-like
(iii)	Hierarchy	(c)	Flexibility + External — innovative
(iv)	Market	(d)	Stability + Internal — formal

A(i)-(b), (ii)-(c), (iii)-(d), (iv)-(a)
B(i)-(a), (ii)-(b), (iii)-(c), (iv)-(d)
C(i)-(c), (ii)-(d), (iii)-(a), (iv)-(b)
D(i)-(d), (ii)-(a), (iii)-(b), (iv)-(c)

View solution

Correct Option: A

Clan → Flexibility + Internal; Adhocracy → Flexibility + External; Hierarchy → Stability + Internal; Market → Stability + External.

Q 04 Strong Culture Medium

A "strong" organisational culture is one in which:

AMost members share core values intensely and consistently
BSenior managers always agree
CThere are extensive written rules
DCompensation is high

View solution

Correct Option: A

Strong culture = high sharing + high intensity + high consistency. The strength lies in shared assumptions, not rule-books.

Q 05 Socialisation Medium

In Van Maanen and Schein's socialisation framework, the stage at which a new employee meets the reality of the organisation and tests its values is:

APre-arrival
BEncounter
CMetamorphosis
DDeparture

View solution

Correct Option: B

Encounter is the reality-testing stage. Pre-arrival → expectations; Metamorphosis → internalisation.

Q 06 Climate Medium

Compared with culture, organisational climate is best characterised as:

ADeeper, slower-moving, anthropological
BSurface-level, current, measured by surveys
CEquivalent to underlying assumptions
DMeasured only qualitatively

View solution

Correct Option: B

Culture = deep DNA; Climate = current weather — surface-level, measured by quantitative surveys, can shift in months.

Q 07 Litwin Stringer Medium

Which is not one of Litwin and Stringer's six climate dimensions?

AStructure
BStandards
CResponsibility
DHierarchy

View solution

Correct Option: D

The six are Structure, Standards, Responsibility, Reward, Support, Commitment. Hierarchy is a culture type (Cameron-Quinn) not a Litwin-Stringer climate dimension.

Q 08 Sustaining Easy

Robbins lists three forces that sustain organisational culture. They are:

AStrategy, Structure, Systems
BSelection, Top management, Socialisation
CHiring, Firing, Promoting
DTraining, Compensation, Appraisal

View solution

Correct Option: B

Selection hires for fit; Top management models values; Socialisation onboards new members.

Quick recall

Culture = “the way we do things around here”; system of shared meaning (Robbins) / basic assumptions (Schein).
Robbins’s seven characteristics: innovation, attention to detail, outcome orientation, people, team, aggressiveness, stability.
Schein’s three levels: Artefacts → Espoused values → Underlying assumptions.
Strong culture = high sharing + intensity + consistency; useful but can become rigid.
Handy’s four: Power (Zeus) · Role (Apollo) · Task (Athena) · Person (Dionysus).
Cameron-Quinn (OCAI) four types on flexibility/stability × internal/external: Clan · Adhocracy · Hierarchy · Market.
Culture is sustained by Selection · Top management · Socialisation. Socialisation stages (Van Maanen-Schein): Pre-arrival → Encounter → Metamorphosis.
Climate vs Culture: surface vs deep; quantitative survey vs qualitative ethnography. Litwin-Stringer’s six dimensions: Structure, Standards, Responsibility, Reward, Support, Commitment.