With so many definitions it often seems difficult to get a good handle on organizational culture so that it can identified, measured and compared, all things that are of great interest to organizational leaders searching for positive links between organizational culture and performance. Perhaps the most well-known model of organizational culture, although not necessarily the most complete, is the three level framework developed by Schein. He began with a definition of “culture” as “a pattern of basic assumptions – invented, discovered or developed by a given group as it learns to cope with 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”. He then fleshed out this definition by suggesting that culture could be understood by dividing it into three domains or levels, as follows:
- Artifacts and Creations: This level, sometimes referred to as “cultural forms”, includes the tangible behavior patterns that are repeatedly seen within an organization and the visible artifacts that serve as widely-recognized manifestations of the cultural values and norms of the organization: structure, facilities, the physical layout of work spaces (e.g., segregation of offices of senior executives so that they are not easily accessible by rank-and-file employees), furnishings, dress codes, rights and rituals, myths and stories, symbols, language, gestures, visible rewards (i.e., perquisites provided to senior executives and/or other identifiable groups of employees), the level of technology used within the organization and where the technology is deployed, and how members of the organization appear to interact with one another and with outsiders who come in contact with the organization.
- Espoused Values: This level includes things such as organizational slogans and other visible expressions of organizational mission, vision and internal and personal values (e.g., identifiable norms and formal guidelines). Espoused values describe the desired state or outcome that the leaders of the organization wish to achieve through the activities of the members of the organization and are thought to have an important influence on how decisions are made within the organization and the level of risk that the organization is willing to undertake.
- Basic Assumptions: This level includes the organization’s tacit core beliefs and assumptions that each member relies on when interpreting and acting upon the organization's values and selecting the behavior that they believe would be appropriate from the organization's cultural perspective. This level is definitely the most difficult to assess since the elements of culture at this level are invisible and generally exist without the awareness of members. These unconscious rules form the basis for norms of behavior and standards of conduct that become deeply embedded through day-to-day interactions of members that serve as a reinforcement mechanism.
Schein’s three domains made for a nice visual; however, the model left many questions unanswered. For example, while one can easily see artifacts and creations that does not necessarily mean that one can understand why they exist and what their purpose and importance within the organization might be. As for the espoused values, the challenge is learning more about why values such as “risk taking” are acceptable in one organization but not in another. Finally, understanding the basic assumptions is necessarily very difficult given that they lack tangibility and even organizational members have problems explaining what they are and how they came about. This is a fundamental challenge for those attempting to understand, manage and change organizational culture since Schein himself concluded that: “What really drives the culture – its essence – are the learned, shared, tacit assumptions on which people base their daily behaviors”. While it is generally assumed that Schein’s model represents a pattern of relationships in which unobservable assumptions influence visible behaviors through rules, prohibitions and standards, the reality is that the model is quite abstract and substitutes complexity reduction for substantive explanatory value.
Dauber et al. reviewed the models of organizational culture offered by Schein and others and concluded they provided little more than “a simplified but limited perspective on culture in organizations . . . due to the high level of abstraction, which confines the explanatory power regarding interdependencies between organizational culture and other domains of an organization (e.g., strategy, structure, operations, etc.)”. Dauber et al. aspired to create a comprehensive “configuration model of organizational culture” that provided a better understanding of the development of the “internal environment” of an organization, which was the focus of the Schein model, but also took into account pressures and influences on organizational culture from the external environment and the consequences of organizational activities for that environment. In their view, such a model should incorporate the following domains:
- A “value and belief system” that included all of the underlying assumptions among organizational members relating to organizational behavior;
- The “strategy” of the organization that represented the overall orientation of the organization toward task achievement and which impacted the structures and activities of the organization;
- The “structural system” that reflected the manifestation of the elements of the organization’s value and belief system as norms, rules, and regulations and which served as a frame of reference for organizational processes and patterns of behavior which stood in line with a predefined organizational strategy;
- The “organizational activities, operations and actions” that were the patterns of behavior within the organization that can served as an observable manifestation of the value and belief system, strategy and structural system; and
- The “external environment” which served as an influential factor through evaluation processes on the organizational culture and on the larger internal environment of the organization.
The configuration model of organizational culture proposed by Dauber et al. included both an internal and external environment, a formulation that followed from the fact that organizations are embedded in various contexts outside of organization itself such as societies and markets. They explained the four domains in the internal environment of their model as follows:
- Organizational culture, which borrowed from the model developed by Schein and included the underlying and unobservable assumptions which serve as the basis for every organization.
- Organizational strategy, which was defined as the overall orientation of an organization for seeking and achieving preset goals and objectives (i.e., a long-term plan for maximizing profits or, in the case of non-profit organizations, covering costs).
- Organizational structure, which was the manifestation of the organizational strategy and the processes (i.e., rules, procedures and appraisal/reward systems) used to regulate information flows, decision making and overall patterns of behavior within the organization.
- Operations, which included the behaviors which occurred within the organization during the process of operationalizing the organizational strategy. Operations could either be “inward-oriented”, meaning they were oriented toward the internal environment, or “outward-oriented”, meaning they were oriented toward the external environment.
The external environment included in the Dauber et al. model was intended to incorporate “all elements outside the boundary of the organization to which an organization needs to adapt” and assumed a dynamic relationship in which organizations were continuously confronted with needs and opportunities for change in order to respond to rapid changes in their external environment. Dauber et al. identified two different and distinguishable external environments to which organizations were “fundamentally linked”. They called the first one the “legitimization environment” and explained that it included all of the stakeholders who legitimized the organization and to which the organization needed to justify the operations conducted in its internal environment: customers, shareholders, employees, suppliers, regulators and society as a whole. With regard to “societal culture”, Dauber et al. argued that it influenced organizational culture in two important ways: through societal pressure from the external environment and through the personal perceptions of societal values employees brought to their roles within the organization. The second external environment was identified as the “task environment”, which included the environmental context (e.g., markets) for the activities and tasks associated with the pursuit of the organizational strategy.
In their model Dauber et al. emphasized several linkages between the two types of external environments and the “operations” domain of the internal environment. Dauber et al. identified two processes that linked the legitimization environment to the organization: “pressure of legitimization” and “legitimization management”. Pressure of legitimization refers to pressure originating from societal culture for the organization “to operate in line with societal values to be accepted as a member of society”. Legitimization management includes lobbying activities (i.e., attempts to influence regulating institutions) and activities intended to positively influence public opinion regarding the organization. The two links between the task environment and operations were the actions taken during the course of operationalization through the organizational structures and “market feedback” generated by operationalization that could be used to identify and make changes in the various domains of the internal environment.
The sources for this post included E. Schein, The Corporate Culture Survival Guide (San Francisco, CA: Jossey-Bass, 1999); and D. Dauber, G. Fink and M. Yolles, “A Configuration Model of Organizational Culture”, SAGE Open 2012, Originally Published on 22 March 2012, http://sgo.sagepub.com/content/2/1/2158244012441482, 4.