Tutorial 14: Organisational Culture
Question 1:
Explain how organisational culture impact employee performance and satisfaction.
Ans:
1. Google – Innovative Culture
a. Culture traits: Open, collaborative, encourages risk-taking and creativity.
b. Impact on employees:
i. Employees feel free to share ideas without fear of failure.
ii. High job satisfaction because contributions are valued.
iii. Leads to high performance through continuous innovation (e.g., Gmail,
Google Maps came from employee initiatives).
2. Toyota – Quality & Continuous Improvement (Kaizen) Culture
a. Culture traits: Discipline, teamwork, and continuous improvement.
b. Impact on employees:
i. Workers feel proud of producing reliable products (higher satisfaction).
ii. Employees are encouraged to suggest process improvements, which boosts
engagement and performance.
3. Wells Fargo (past scandal) – Toxic Sales Culture
a. Culture traits: Aggressive, pressure to meet sales quotas at any cost.
b. Impact on employees:
i. Stress and dissatisfaction because of unrealistic targets.
ii. Employees engaged in unethical practices (fake accounts) just to survive.
iii. Low satisfaction and damaged performance reputation for the company.
Question 2:
Describe the three primary ways that organisational culture is transmitted to employees.
Provide examples of each method in a real-world organisational context.
Ans:
Three Primary Ways Organisational Culture is Transmitted
1. Stories
a. Explanation: Organizations tell stories about founders, critical events, or
successful employees to reinforce values and expected behavior. These stories
highlight what the organization considers important.
b. Example: At Apple, stories about Steve Jobs’ obsession with design excellence
are widely told. These reinforce the cultural value of innovation and
perfectionism in product design.
2. Rituals
a. Explanation: Rituals are repeated activities or ceremonies that express and
reinforce key values of the organization. They create a shared experience and
remind employees of what the company prioritizes.
b. Example: At Zappos, new employees go through a unique onboarding ritual:
after training, they are offered money to quit if they don’t feel aligned with the
culture. This ritual reinforces Zappos’ cultural value of commitment to customer
service and cultural fit.
3. Symbols (Material Symbols & Language)
a. Explanation:
i. Symbols: Physical items, office design, dress code, logos, perks that
signal what the company values.
ii. Language: Special jargon, acronyms, or slogans that communicate shared
values.
b. Examples:
i. At Google, open office spaces, casual dress, and fun perks (like nap pods
& game rooms) symbolize a culture of creativity and openness.
ii. At Starbucks, the use of terms like “barista,” “partner,” and calling
employees “partners” rather than “staff” emphasizes teamwork and
inclusivity.
Question 3:
Discuss the role of leadership in creating and sustaining an ethical organisational culture.
What are some strategies leaders can use to promote ethical behaviour within their
organisation?
Ans:
Role of Leadership in Creating vs Sustaining an Ethical Culture
Aspect Creating an Ethical Sustaining an Ethical
Culture Culture
Tone at the Top Leaders set the direction Leaders must continue to
by being role models and “walk the talk” and show
showing what is right or ethical behavior daily.
wrong. Example: Steve Example: Howard Schultz
Jobs at Apple focused on at Starbucks kept
innovation and passion emphasizing fairness and
from the start. ethical sourcing.
Communicating Leaders introduce codes of Leaders keep reminding
Values ethics, policies, and vision employees of ethical
statements to guide standards through
employees. Example: meetings, training, and
Johnson & Johnson’s open discussions.
“Credo” sets clear ethical
priorities.
Hiring and Leaders recruit people Leaders provide ongoing
Socialization who fit the ethical values ethics training and
and socialize them during mentoring to reinforce
onboarding. Example: The values and help employees
Body Shop hires people handle dilemmas.
who care about social
responsibility.
Rewards and At the creation stage, Leaders make sure
Sanctions leaders outline how ethical employees who act
behavior will be valued. ethically are rewarded and
those who act unethically
are punished. Example:
Unilever rewards staff who
support sustainability.
Protection and At the start, leaders design Leaders sustain trust by
Trust reporting systems or protecting whistleblowers
channels for concerns. and encouraging
transparency. Example:
GE’s confidential reporting
systems.
Strategies Leaders Can Use to Promote Ethical Behaviour
Strategy Explanation Example
Be a Visible Role Employees look up to leaders. At Patagonia, leaders show
Model When leaders consistently act commitment to environmental
ethically, it sets the standard. responsibility by practicing
sustainability themselves.
Communicate Ethical Clearly state the code of ethics, Johnson & Johnson’s “Credo”
Expectations values, and behavioral guides decisions and is regularly
standards. communicated to staff.
Provide Ethics Training helps employees deal GE provides ongoing ethics training
Training with dilemmas and understand to employees across all levels.
the consequences of unethical
acts.
Reward Ethical Recognition reinforces good Unilever rewards employees who
Behaviour & Punish conduct; sanctions discourage champion sustainability projects.
Unethical Acts misconduct.
Protect Whistleblowers Employees are more willing to After the Enron scandal, many firms
report wrongdoing when they set up anonymous hotlines to
feel safe. protect whistleblowers.
Build Open Create a climate where At Starbucks, managers hold open
Communication employees feel comfortable forums to encourage transparency
Channels discussing ethical issues. and feedback.