Layers of Organizational Culture

Layers of Organizational Culture: Introduction

The purpose of this assignment is to focus on layers of organizational culture as core components of organization and design theory. Specifically, it covers observable artifacts, values, espoused values, enacted values, and basic assumptions. Also, it relates the outcomes of organizational culture by using some companies such as Zappos, Southwest Airlines and Google.

One major responsibility of critical leadership is to “develop and sustain organizational characteristics, which reward and promote collective efforts” (Schein, 2010, p. 1). Perhaps the most vital aspect is organizational culture. It is imperative to understand the importance of culture in an organization. According to Edgar Schein (1991), organizations develop their cultures to assist them to cope with changes in their environments. Modern organizations are complex and face several issues. For any organization to be successful, employees must understand its culture, and culture, largely, influences the overall success (Schein, 2010). It is noted that several challenges that organizations encounter can be traced to their ineffectiveness in analyzing and assessing their organizational cultures (Schein, 1991). For any organization that attempts to introduce changes or implement new strategies, they are most likely to fail if they cannot understand their cultures. Failure to understand organizational culture has often led to resistance. Thus, such difficulties have been associated with notable failures to understand existing organizational cultures.

Organizational culture has no single definition. Instead, scholars have approached it from various perspectives, including behaviors, science, communications and sociology among others. Organizational culture consists of the major elements of “shared assumptions values, and beliefs considered as being the correct way of thinking about and acting on problems and opportunities facing the organization” (Schein, 1991). In this case, organizational culture reflects important attributes that guide practices. It shapes what transpires and its effects are everywhere in an organization but remain invisible unless explored critically.

There are three layers of organizational culture. They include observable artifacts, espoused values, and basic underlying assumptions. The roles of organizational culture are to promote organizational identity, demonstrate collective commitment, social stability and promote the making of sense of what organizations do.

Layers of Organizational Culture: Observable Artifacts

Any organizational culture is interpreted indirectly using observable artifacts. Artifacts are noticeable symbols and signs of organizational culture (Schein, 2010). They reflect simple acts of welcoming customers, the physical setup of office, employee remuneration and rewards and even dress code. Zappos, Southwest Airlines and Google all have various observable artifacts.

Zappos, for instance, has certain observable organizational traits shown through excellent customer service, favorable return policies, free shipping, free return shipping, and display strategies with millions of shoes to select from among others. These observable artifacts have established Zappos’ identity as a company in the online shoe retail market. The physical manifestation of the company’s culture also reflects its observable artifacts. For instance, Zappos displays its Web site during the entire commercial accompanied by its name and shoe print. In this way, Zappos uses these observable artifacts to reinforce its brand and culture.

Fun has been identified as a core value in the company. Workers normally wear sneakers and jeans to work, have noses and their lips pierced and have coffee cups, bottles, pizza boxes on their workstations. These are observable artifacts, which have contributed to Zappos’ success. These are the company’s core culture. Zappos’ goal is to make its employees and customers happy and as a result, other things will just follow. This is the act of getting the culture right to support the brand and customer services and selling.

Southwest Airlines observable artifacts have evolved (Smith, 2004). Smith had observed that observable artifacts at the company have changed from “flight attendants wearing hot pants to a culture of shared goals, shared knowledge and mutual respect for a national company” (p. 2). The company’s observable artifacts are also demonstrated through its mission statement of dedication to the highest quality of customer services. The company encourages its employees to demonstrate a sense of friendliness, warmth and individual pride when handling customer issues (Kinicki & Fugate, 2012). All employees of the company must demonstrate their commitment to this mission, which reflect observable artifacts. The company social system stability is another element of observable artifact. In this case, employees’ work environment is considered as reinforcing and positive and any changes and conflicts are handled in effective ways (Kinicki & Fugate, 2012). Southwest Airlines has developed its work philosophy of fun, celebration, and parties (Kinicki & Fugate, 2012). For instance, Southwest Airlines provides a budget allocation for parties in every city in which it operates. In addition, it uses various methods focused on performance to award excellent performances and service awards to instill culture in its employees. The positive and reinforcing work environment has resulted in the lowest employment rate of attrition and the employment of married couples (Kinicki & Fugate, 2012).

Google also displays various aspects of observable artifacts. At Google, for instance, employees are encouraged to conduct daily ‘stand up’ meetings, and it applies to all employees involved in projects to ensure that time wasted is minimal and reduce the level of comfort during the meeting and rapid-fire updates (Kinicki & Fugate, 2012). The stand-up meeting reflects the company’s artifacts that strive to enhance productivity and ensure a focus on projects and completion as stipulated. It is simple for the company to change its observable artifacts relative to other aspects of culture, which cannot be easily observed.

Google’s observable artifacts are also reflected on its campus decorations to reflect geographic representations of various countries. Every office reflects various cultural features of a given region or country. Google has introduced bikes and scooters to facilitate movement within its campuses. Most of the company’s offices are designed to facilitate group thinking and decision-making on business issues. Google has provided laptops and Internet accessibility to encourage employees to work in any environment within the campus. Besides, several cafes within the campus offer various meals to employees to ensure that they remain healthy and productive. Finally, the company has provided several gyms, various sports, and other free services to its employees. These observable artifacts encourage employees to be productive and as a result, have contributed to the companies’ ranking among the best places to work (Baack, 2012).

Overall, observable attributes are responsible for Zappos, Southwest Airlines and Google strong organizational cultures, and these companies have been able to attract the best talents, retain them and make their work environments pleasant.

Layers of Organizational Culture: Values

According to Kinicki and Fugate (2012), the five key elements of values are “concepts or beliefs; pertain to desirable end-states or behaviors; transcend situations; guide selection or evaluation of behavior and events, and ordered by relative importance” (p. 33). It is therefore imperative to understand the differences between espoused values and enacted values.

Layers of Organizational Culture: Espoused Values

Espoused values reflect organizational explicitly stated values and norms, which are preferred by an organization (Kinicki & Fugate, 2012, p. 34). These values are normally established by the company founders and must be supported by senior executives at the top in both small and large organizations (Kinicki & Fugate, 2012). Espoused values show exactly how management teams wish to run their organizations. Google, for instance, displays its espoused values in various ways. Google believes that employees should act in the best interest of the company by following a specific set of certain values (Google, 2015). The company has identified the following ten values to display its espoused values (Google, 2015).

• Focus on the user and all else will follow
• It’s best to do one thing well
• Fast is better than slow
• Democracy on the web works
• You don’t need to be at your desk to need an answer
• You can make money without doing evil
• There’s always more information out there
• The need for information crosses all borders
• You can be serious without a suit
• Great just isn’t good enough”

According to the information provided, these “10 things” were written when the company was at the nascent stage. Over time, the company revisits these ten values to determine their “effectiveness, and it believes that the list holds” (Google, 2015, p. 1).

Zappos CEO has often discussed some of the company’s espoused values and lived values. The company strives to reduce barriers between management and employees to promote performance. Zappos focuses on delivering happiness through the following ten core values (Zappos, 2013).

• Deliver Wow Through Service
• Embrace and Drive Change
• Create Fun and a Little Weirdness
• Be Adventurous, Creative and Open-Minded
• Pursue Growth and Learning
• Build Open and Honest Relationships with Communication
• Build a Positive Team and Family Spirit
• Do More with Less
• Be Passionate and Determined
• Be Humble

Zappos believes that organizational culture evolves. In this regard, Zappos focuses on difficult issues and assumes that employees have some unresolved challenges and therefore they are never satisfied. Consequently, the company dedicates adequate time and efforts to analyze and introduce changes for growth. During the hiring process, Zappos concentrates on candidates’ cultural fit. Skills and experiences are necessary, but the company prioritizes cultural fit. For instance, the company asks around if its potential employees were polite to drivers once they have been picked from the airport. Employees who can pass the culture test fit are encouraged to quit and are offered a bonus and any expenses incurred within the first week. However, less than three percent accept this counterintuitive arrangement and therefore, the rest of the recruits can fit within the company’s culture. Humbleness is the most important for the company among its set of ten core values.

Zappos also recognizes that committable core values are different from one organization to another and therefore, they might not apply in different organizations for managers. Nevertheless, living the value adopted is the most imperative aspect of espoused values. For a company to demonstrate its core values, hiring and dismissing employees should be reflected in the values rather than performances. Zappos tries to create a larger vision alongside a greater purpose that goes beyond revenues and profitability. In this regard, the company espoused values that go beyond profits to include aspects of great work and ‘delivering happiness’ to various stakeholders, particularly to customers through incredible customer service and striving to exceed customers’ expectations. Employees can go to greater lengths to assist customers.

Southwest Airlines believes that employees live and demonstrate espoused values (Southwest Airlines, 2015). First, the company has created values to reflect its identity. In this case, employees have always recognized the company as “a fun place to work that ensures their satisfaction and promotes customer loyalty before profits” (Kinicki & Fugate, 2012, p. 34). The company’s founder, Herb Kelleher has always noted that employees come first before customers and shareholders, and this is not an issue for senior executives. The bottom line is that employees should be “happy, satisfied, dedicated, and energetic” (Kinicki & Fugate, 2012, p. 35) so that they can take good care of customers, and happy customers always come back. Consequently, this would make the shareholders happy. Southwest Airlines also promotes a collective commitment to reflect its espoused value. This espoused value is reflected in the company’s mission, “dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit” (Southwest Airlines, 2015). Nearly all employees of Southwest Airlines are committed to demonstrate this mission in their interactions with all stakeholders. Today, the company has a few cases of complaints relative to other airline companies.

Southwest Airlines also believes in enhancing social system stability for its employees. In this case, the work environment is favorable and positive to reinforce values. Conflicts and changes are successfully managed with minimal resistance. Workplace is fun, celebrated, and employees do their parties with the company’s budget allocations for every city. Also, it strives to shape employees behaviors and assist them to make sense of their environments. Consequently, employees are able to understand why Southwest Airlines does “some activities and its intended plans for achieving long-term goals” (Kinicki & Fugate, 2012, p. 34). Thus, employees have been able to understand the company’s dedication to service, low fare and high-frequency carrier with a focus on other emerging markets.

Generally, espoused values are vital for organizations because they offer employees a chance to evaluate what organizations consider as important for growth and success (Kinicki & Fugate, 2012). Moreover, espoused values reflect organizational strategies to shape their overall culture (McShane & Glinow, 2000).

Layers of Organizational Culture: Enacted Values

Enacted values represent “the values and norms that actually are exhibited or converted into employee behavior” (Kinicki & Fugate, 2012, p. 34). These are the values, which employees ascribe to their organizations by watching what takes place daily. For the three companies, enacted values differ significantly. Enacted values are necessary for companies because they essentially reflect the actual culture of any organization.

Companies have defined their espoused values, but this does not necessarily mean that employees behavior or strictly adhere to these values. In these three companies, employees have demonstrated enacted values.

Google employees have always demonstrated enacted values. Over the years, the company has encouraged its employees to propose ideas and encourage knowledge sharing and team. Employees are encouraged to develop new products and test their functionality for users. In fact, most employees work on their innovative ideas and present to their teams for scrutiny. Throughout Google campus, offices are designed to encouraged teamwork and knowledge sharing so that employees can work together more often. In addition, employees have time to pursue their ideas within campus independently. Google’s greatest, innovative products have been developed in such an environment that encourages creativity and innovativeness.

Southwest Airlines also denotes elements of enacted values (Kinicki & Fugate, 2012). The company has grown gradually to be a top carrier in the US. The company takes additional time to hire and train its employees, apply the latest technologies, manage costs of operations and ensure that all relationships are given high priority. These enacted values have actually worked well for the company so far. Southwest Airlines has managed to operate successfully in an industry with so many external influences, including regulations, technologies, growing traffic, poor weather, labor market issues and of course increasing competition from other airline companies because of its enacted values (Kelley, 2001). On this note, it is observed that Southwest Airlines has to regularly review and reinvent new processes to facilitate change in the industry. In all aspects of its operations, the company encourages its employees to simplify processes, enhance innovation, manage costs while promoting teamwork, effective communication and operation coordination (Kelley, 2001). Flight attendants are known to smile while pilots have often sacrificed their time to ensure that the company is profitable throughout its history of operation. These enacted values have seen the company transforms the US aviation industry by reaching the critical mass through low-cost strategies and high reliability. Many passengers consider Southwest Airlines as the best company for short-distance travel, on-time arrivals, bags fly free and least cases of passengers’ complaints.

Southwest Airlines focuses on cost management through simple, innovative processes like ticketless, online booking and snacks-only food service (Kelley, 2001). The company recently acquired AirTran and focuses on international destinations. By using the same strategies to keep low fares, the company also focuses on cost controls rather than cost-cutting. Also, it is known to invest in employee training, equipment, and retention of talented employees. Southwest Airlines employees are ready to relate with others. This is practiced through senior executives’ open door policy down to the frontline service representatives. This value has created a favorable work environment that has defined the company’s culture. In fact, Southwest Airlines has no records of laid-off employees or records of pay cut because of its enacted values of cost management and effective hiring processes.

Zappos enacted values are reflected on excellent customer service. In fact, the company has created a Customer Loyalty Team, or CLT, which acts as its ‘nerve center’. The CEO is known for his philosophy of happiness, which is instilled and reflected in the ten company core values (Zappos, 2013). Employees are expected to practice happiness when interacting with customers over the phone. Zappos has introduced a human element in its online store to defeat other established firms such as Amazon. The company openly displays a toll-free customer service phone number and there are no limits for call duration even with a single customer. Customers can talk as much as they want with Zappos CTL representatives.

Overall, enacted values are important for the three companies because they demonstrate how these organizations act in actual sense relative to observable artifacts and espoused values.

Layers of Organizational Culture: Basic Underlying Assumptions

Basic underlying assumptions are “unobservable and represent the core of organizational culture and are part of organizational values that have developed and considered normal or taken for granted” (Kinicki & Fugate, 2012, p. 35). They have ‘matured’ over time and turned into “assumptions to guide organizational behaviors” (Kinicki & Fugate, 2012, p. 35). In this regard, the basic underlying assumptions may not promote change. In some instances, employees may generally demonstrate basic assumptions and show “behavior based on an inconsistent value inconceivable” (Kinicki & Fugate, 2012, p. 35).

In the case of Google, the company is known for innovative culture. On this note, if senior executives act in a manner that does not “support or value innovation and creativity at Google, then employees would be surprised” (Kinicki & Fugate, 2012, p. 35).

Southwest Airlines, for instance, has a basic assumption that is based on the people first before profits. Therefore, if the company changes to profit first before employees, then this would mean a culture shift. Likewise, happiness at Zappos is now a basic underlying assumption that defines the company’s culture.

Culture is critical for any organization. Successful organizations understand their values and ideas that promote performance, which they have “institutionalized to form a part of the core cultures” (Kinicki & Fugate, 2012, p. 33). Organizational cultures at Zappos, Southwest Airlines and Google have given employees a sense of identities. Employees from these companies show commitment to specific values and specific ways of doing business. Cultures have two major roles in any organization. Organizational culture integrates employees so that they comprehend how to share and function as a team, and it assists organizations to cope up with the dynamics of the external environment.

All the evaluated three layers of organizational culture appear to be extremely strong in these three successful companies. They are designed to encourage employees to love their work and make work fun. This reflects a strong organizational culture, which makes these companies so successful relative to their industry competitors.

Many employees in other organizations have wider gaps in their organizational culture and ideal practices.

For any aspiring employees, working at Zappos, Google and Southwest Airlines could be the most appealing because the companies have focused on their people and creating supportive organizational cultures. Therefore, other companies must develop their unique cultures to support business success and employee growth.

Overall, organizational culture consists of shared values and assumptions that employees hold and determines its performances. Organizational culture has some notable features. For instance, they are learned and transferred to new recruits through training and socialization. Organizational cultures affect work behaviors and employee and organizational performance. Organizational cultures differ in terms of layers and across companies in the same industry. Zappos, Southwest Airlines and Google have provided perfect examples for reviewing organizational culture and its impacts on an organization. The essay shows that organizational cultures are established by founders, but can be transformed over time. The nature of the industry and the prevailing business environments are also responsible for shaping organizational culture. Leadership is equally important in shaping the vision and behavior of organizations. Consequently, organizational culture affects the company’s various practices, policies, and operational procedures. Organizational culture strives to promote performance, but organizations differ about their cultural elements, specifically, observed artifacts, values, and basic assumptions.

References

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Kinicki, A., & Fugate, M. (2012). Organizational behavior: Key concepts, skills, and best practices. New York, NY: McGraw-Hill.

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Zappos. (2013). Introducing: Core Values Frog! Web.