Organizational Culture and Leadership (Schein)
Deze samenvatting is gebaseerd op het studiejaar 2013-2014.
The following work studies the concepts of Organizational Culture and that of Leadership. Culture can be seen as an ever changing phenomenon, which despite its dynamic nature, provides a stable schematic background accommodating our values and beliefs. This phenomenon can also be described as giving us a sense of perception, experience and guidelines to act in a socially acceptable manner. In this way, culture provides us with a sense of normality and abnormality, as well as playing a fundamental role in language, perception, behavior and interpersonal interactions. The longer the culture is re-enacted the more stable it becomes.
Leadership can be understood as a feature by which one is able to influence behavior and belief in others. In this way, leadership can give rise to new perceptions, values or behavior and so essentially lead to the formation of new cultures.
Culture assumes a number of levels within our society:
An overarching level is that of macro cultures. To this category we can classify nations, ethnicity or religion. Since these constructs have existed for a long period of time, they are seen as more stable and ranked.
Organizational cultures refer to private, public, (non) governmental organizations. The stability of organizational cultures is variable, largely depending on the context of its formation and lifespan. Groups which orient themselves around a common occupation are known as subcultures. These usually operate in the context of a macro-culture and can vary in their degree of structure.
Finally we can distinguish micro cultures. Micro cultures comprise of small occupational groups (or microsystems) whose functioning stretches across other occupational organizations. Think for example about the law, which applies to all organizational cultures, largely irrespective of their individual occupation. Micro cultures may exist within or outside of organizations and are the most variable and dynamic form of culture. This also underlines them as important in new culture foundation and development across time.
Culture in organizational systems can thus be conceived of as the result of a leader or creator, who establishes a certain domain, which consequently is accepted by a certain targeted group. The leader can be said to act as a founder of a culture, which would accommodate the rules, values, beliefs and perceptions of the groups involved. Expanding on this, the leader position provides not only a value-belief framework for the group, but also structure, order and meaning. Of course, elements of a leaders culture may be dysfunctional and subject to change.
Every day we come in contact with various forms of organizations. For most of us, it is easy to recognize cultural variations at national levels however, understanding culture within organizational context tends to be puzzling. We find it harder to understand how organizational cultures differ. Think of a job application where you can go to a number of organizations within the same area and find that they each have their individual “style” or modus operandi. Groups in organizations can act unpredictably, ineffectively, irrationally or even ridiculously compared to our own expectations. Understanding of culture, its concepts and dynamicity can shed light on how different organizations and groups of people are able to act inconsistently, as well as how culture can shape and influence individual group identities. With this in mind, we can reach deeper insight into the impact of the culture on our own group and consequently on our own personality. Each organization has a set of assumptions regard operation known as shared assumptions. Cultural analysis takes place when we attempt to compare shared assumptions with our own assumptions. It is important to distinguish one’s own assumptions from those of other groups in order to reach understanding of them. Our assumptions are shaped by our occupational experience, therefore when analyzing other groups it is important to be perceptive and sensitive of cultural forces operating amongst groups, occupations and organizations.
Culture as an abstraction
Culture has been interpreted in different ways across time. Organizational researchers have attempted to describe it as norms and practices that convey the organizations values and worldview and handle groups of people involved. Managerial literature often suggested that having a culture within an organization is necessary for effective performance, where a stronger culture is seen as more effective. How effective, good or functional the organization is rests not only on the culture alone, but its relationship to its surrounding environment. Culture is - to a large extent - a subconscious process. We cannot see it, touch it or smell it, but it does create various representations, blueprints and frameworks by which we function. Personality directs behaviors and restrictions of an individual. Culture acts the same way as personality, but on group level.
The concept of culture is an abstract term with a number of implications:
The term “culture” implies a stable structure – something “cultural” is not only a shared belief or assumption, but also a defining feature of that group. Once established it is unlikely to change. Further the term suggests depth in implying a differentiation between what cultures are at the core, with manifestations of culture. The 3rd implication of culture is the breadth with which culture is involved in a group functioning. In organizations, culture influences how the goals will be dealt with, the interaction within the organization as well as with the environment. Finally, culture implies integration of all its components (e.g. behaviors, values, climate and rituals) into a tangible paradigm. It is this patterning and integration between these various facets that is at the heart of culture. Integration stems from basic human need to attain as much order and consistency from our perception of the environment. Shared history in a social context leads to formation of culture. How strong this culture is, depends on how long it has been present in time and how stabile the membership of the group is. In addition culture entails shared historical experiences. The intensity or impact of these experiences also influences the strength or cohesion of a culture. Culture can thus be considered a product of social learning.
Content of Culture
The culture of a group can thus be defined as an integration of patterns of shared assumptions (through group learning), that provides solutions to internal integration and external environmental adaptation problems. These solutions have been validated – for instance by historical experience - and are taught to new group members as effective ways of perception, thinking and feeling when dealing with similar issues. However, not all groups have the learning experience to develop a culture to this extent. In these sense weaker cultures, may foster frequent goal, leader or membership change or may split off into subcultures. We define such subcultures as fragmented or differentiated cultures. Culture formation is thus a stride for integrity and stability and an expression of learning. Not all groups however, are able to carry the development to its full extent. Organizational and group theories distinguish two sets of problems groups encounter in this strive. The group should be able to survive, grow and adapt to its environment. The internal integration of the group enables the ability to learn and adapt. These two areas reflect the macro cultural context in which the group exists. This context is a source from which deeper and broader assumptions are derived, such as human nature, reality, time and space.
Socialization and acculturation
Once a group has a culture, it will attempt to pass it on to new group members. Studying what new members are taught, is a good way of discovering some of the elements of that culture, but it is limited to surface aspects. The core aspects of the culture will be taught only once a member gains a permanent status within the group. New members begin with the search for norms and values of the group they have joined.
Learning takes place partly through anticipatory socialization and partly self-socialization. To some extent members can discover cultural assumptions of the group themselves. The remainder of the learning occurs when control is exerted by the older members on the new ones, where rewards and punishments facilitate the discovery of cultural assumptions. The learning process as well as the teaching process is for the large part implicit and fairly unsystematic. If the culture has no shared assumptions, the interaction between old and new members of the group will be of more creative and constructive nature. Shared assumptions, once present are taught to new members. In this sense culture can be seen as an instrument of social control.
Observing overt behavior may sometimes shed light on certain basic assumptions (for instance in a ritual or ceremony) but can lead to false conclusions. We may observe behaviour, but we can never know whether that behavior is a manifestation of culture or not. Behavioral observation is thus only of value, once essential assumptions of the culture have been identified and here from its manifestation in behavior.
Culture can be said as having 3 levels. These are:
The division in these levels aims to describe each level as the extent to which a cultural phenomenon is visible to an observer. Some manifestations are overt and noticeable, whilst others constitute unconscious assumptions. With regards to covert manifestations, a degree of caution is required when drawing inferences on the essential characteristics of culture from overt behavior. Basic assumptions are sometimes referred to as basic values, but this work prefers the term assumption as it points to something that is taken for granted, rather than values which can be seen as disputable.
The surface or artifact level refers to various observable and “feelable” features of a group, such as architecture, language, style, clothing, values, visible rituals or ceremonies etc. The artifact level of a culture can thus be seen as providing us with clues or a “flavor” of the new culture. Though it provides us with some information about the culture, inferences about deeper understanding of the culture cannot be accurately drawn from – de facto – only overt manifestations. The longer one spends with a given group, the more artifacts will come to light. If pressed by time, one can always attempt to draw information from older members of the group on artifact nature or context.
Espoused beliefs and values form the 2nd level of culture. This level includes ideals and goals, values and aspirations, ideologies and rationalizations of a group. When a group is forming, there are initially no shared assumptions and so no fixed definition of the group. When this group in forming encounters face an obstacle or problem, various solutions can be suggested by individual perceptions of what is right and wrong or what could work or would not work by people involved.
Once an individual manages to convince others of his or her idea (display of leadership), the group follows up on the assumption, but this does not yet have the form of a shared assumption but of a shared belief (not all members may be convinced of a successful outcome of the strategy). Once the suggestion is put to work and evaluated as successful then it becomes slowly accepted as an adequate response to a given problem. When a solution has withstood the test of time and contributed to successful outcomes (in dealing with given obstacles) it becomes a shared assumption. Imagine a business that is losing money. The manager may proclaim that there needs to be more advertising. The assumption amongst the workers (as brought on by the manager) is formed that advertising in this situation will increase income and effectively solve the problem. Even though the group may implement the directive, not everyone may believe in its effectiveness. If indeed the strategy works and leads to a positive outcome, consensus is likely to form on this being an effective strategy. When consensus is formed and sustained in this way over time and similar situations, we speak of it as becoming a shared assumption.
It is important to point out that not all shared assumptions develop this way. Solutions based on a given value may not work. If the solution is empirically tested and continues to reliably tackle the problem that the group may be facing, then the transition to a basic assumption takes place. Another issue relates to the fact that some value domains deal with moral, esthetic or otherwise difficult to control elements. Should this be the case, agreement may be reached through social validation.
Social validation refers to certain beliefs being agreed upon only the shared social experience of the given group. Religion is a good example, where no culture can provide evidence for a superiority of a given faith over another. Nevertheless, if a given belief is reinforced by the members of the group or, is socially validated – the belief starts to become taken for granted. Failure to adhere may result in repercussion. In the example of religion, we could illustrate this with ex-communication from a given faith.
The final obstacle in the formation of shared assumptions is the fact that sometimes a given strategy is hard to predict in terms of outcome, especially when the link between performance and strategy is difficult to trace. The “success” of a given strategy can thus be seen as the degree to which this strategy provides comfort to the group’s members in given circumstances.
Espoused beliefs and values are conscious and explicit and serve as means of maintaining norms and morals and guidelines through difficult situations. When espoused beliefs, which provide comfort and security to the group, are not in line with the beliefs and values relating to effective performance, it is common for a group to reflect the espoused values in the desired behavior. In such a case one would find little reflection of espoused values in observable behavior. For example, in U.S. companies a common espoused value is teamwork, when in reality rewards are provided for individual competitiveness. It is thus necessary and warranted to discriminate espoused beliefs in terms of their relation to performance guide, their relation to an organizations philosophy or “world-view” and their relation to aspirations or rationalizations of the future.
Espoused beliefs may be contradictory at times (e.g. company claiming to have the highest quality product for the lowest price possible) and a firmer understanding of the third level of culture – the basic assumptions is required to make full sense of an organizations beliefs and values. Basic assumptions, formed by reproduction of a given strategy and the evaluation thereof as successful establishes it within our perception of reality. Once established, a basic assumption is very difficult to change. Since such assumptions provide a basis for coping with various aspects of our reality, we can imagine that if such assumptions are not met, enacted or removed all together – the result is a high degree of anxiety. It is inherent to humans to desire structure and order. McGregor notes that basic assumptions become the basis of management and control systems. These systems perpetuate themselves, as when individuals are treated consistently under a given assumption, in time, they adopt themselves to behave according to this assumption. Consider a scenario where a manager is about to provide a strategy to a bigger audience:
He asks his subordinate, for an opinion on his concept of the strategy. Suppose now, that the subordinate comes from a culture, where one of the basic assumptions is “never to discredit your superior”. When asked for advice, the strategy of the boss may be a complete disaster, yet the basic assumption of the subordinate will stop him from conveying this to the boss. Instead, he may praise the boss, even though he knows that the strategy will fail. The meeting takes place and the strategy is a flop.
The confused boss asks the subordinate what could have gone wrong. The subordinate – though he may well know what went wrong and have a tangible alternative in store – will not express his idea as this could undermine the boss authority, hence discredit his superior. He may then blame the flop of the strategy on circumstantial elements or luck. The boss is confused, and receives no feedback from his subordinate, whilst the subordinate, acts out according to his basic assumption, even if he knows that its holding back the productivity of the job overall. Neither of them will understand the cultural basic assumption each of them acted upon, with confusion or misinterpretation as a result. The manager may see the subordinate as “brown-nosing” due to his compliments whilst otherwise being unhelpful, whilst the subordinate may lose respect for the manager as an authority figure since his strategy failed and he is asking his subordinate for revision and support. If assumptions are idiosyncratic, they will often be corrected, as the individual will see a clear differentiation between himself and the rest of the group. Shared basic assumptions become mutually enforced and so gain stability in structure. In the case of the manager and subordinate, a different (3rd kind) of assumption may have solved the issue if it accounted for both individual’s assumptions. It is this cross cultural integration that can be seen as a big obstacle for leadership.
The following will attempt to elaborate on the three levels of culture with 2 illustrating case studies. The cases of Digital Equipment Corporation (DEC) and Ciba-Geigy are good examples to that should help clarify how to describe aspects of organizational culture, as well as reveal several relevant cultural dynamics. Imagine yourself as being the character described in the cases.
DEC is a company known for successful manufacture of “mini computers”. The company has managed to become the second largest computer company, before its rapid fall in the 1990s. In 1998 it was bought out by Compaq Corp., which in turn was acquired by Hewlett Packard, just 3 years later.
When we first enter DEC we begin our observation of artifacts or observable features of the group. When entering the lobby we see a rather open office architectural design and quite an informal manner of clothing. Employees address each other informally and passing through the halls gives off a sense of openness. Nevertheless, everyone maintains a rapid pace. As the days progress in your new job, you begin to attend meetings. You get a quite different sense from your first impression.
The meetings occur frequently with confrontation quickly coming to the foreground. Discussions quickly become emotionally loaded and unstructured. The founder or CEO who is also present at these meetings is dressed casually and addresses the meeting members in a casual manner. It is difficult for you to distinguish based on what you see which members hold which ranking positions. You see little communication that could indicate the superior status of given members, for example older, more experienced employees. The arrangement of furniture also makes it difficult to decipher ranks. The meeting hosts in your view a lot of dysfunctional aspects, with people arguing amongst each other and with the CEO. To your surprise the CEO is contested frequently and even interrupted by some of his employees.
The meeting is out, and you get a feeling of chaos and confusion regarding the order and progression of the meetings. You then enter the lunch room where the dining table is set very informally and everyone is interacting. While having lunch you ask a colleague about the worrying confrontational nature you experienced during the meeting and learn that this is a relatively typical way that meetings take place.
All of these observations you have made so far, give you a flavour of what the culture of this group may be. You know what you felt but what does this all mean? In order to answer this question we must delve deeper into cultural levels. You integrate into your work and communicate with other employees. After asking them about some of the observations you made earlier, you learn some deeper information on espoused beliefs. You learn for instance, that the beliefs and values often took the form of slogans which were circulated within the organization by the CEO. Listening further, we learn that personal responsibility is valued highly. If someone proposes an idea and is able to argue it through successfully, he or she must also be prepared to execute this proposal. In short, your idea – you execute it. During the conversation, you also hear that employees on all levels of the company are expected to be thinking about what they do and its consequences. In this context, any idea which had any resistance on anyone’s side, was endorsed to bring this objection forward and discuss it, which often was reflected in insubordination. Let’s reflect on this.
Initially, from the observation of the artifacts we drew an idea of the organization as relatively casual, informal, open yet busy. During the meetings however we gained a contrasting image of tension, confrontation and interruption. The beliefs which endorse individuals standing up for their arguments as well as having to lead their suggestions through battery of scrutiny before being able to gain acceptance of their proposal, suggest reason for the perceived confrontational and sometimes emotional nature of argumentation in meetings. The advantage of this which previously may be have been missed during your observation, is that once an idea or suggestion goes through this process of heavy discussion, and gains acceptance, it gains acceptance by everyone in the group (assuming all the arguments that arose were dealt with). This also promotes a sense of cohesion.
To further understand these artifacts and beliefs of which we now have some idea, we must delve to the deepest sections of culture – its basic assumptions. The founding group of DEC came from an engineering background and developed five assumptions:
The unit (individual) is ultimately responsible for ideas and entrepreneurial spirit.
Units must be able to assume responsibility and do the right thing.
No one is smart enough to evaluate his or her ideas, so everyone is required to contest, argue and debate.
The work of the organization is technological innovation and this should remain “fun”
We are a family and we tend for one another. Though differences in opinion exist, no member shall be excluded from this family.
Notice how the last assumption justifies both seemingly insubordinate and confrontational behavior as well as inevitably a sense of unity and belonging. We could have thought this combination as hard to believe after our experiences, but this assumption explains the whole as the sum of its parts. However, these parts alone cannot explain the organizations functioning. You learn 5 additional assumptions which reflect the group’s values regarding marketing and customer relation:
The only good way to sell a product is to solve the customers problem, even at the cost of sales.
Regardless of circumstance, units act responsibly and will continue to do so.
Market is the best decision marker when several competitors to the product are present.
Despite its size, the company should maintain central control.
DEC engineer expertise is based on their experiences with products.
It is not merely each assumption acting on its own, but in combination with one another that allowed DEC to function and evolve. The interweaving of these assumptions was reflected in personal responsibility, conflict, individual commitment and belief in solving customer problems. These interconnections bring us closer to understanding the core or essence of culture within DEC.
Ciba-Geigy was a Swiss multidivisional chemical company, decentralized geographically. The company eventually merged with a competitor to become Novartis. The day before you start work, you research a little more about Ciba-Geigy. You learn that the company is run by a board of directors and an internal committee which was responsible (also legally) for the decisions made. The decision making process was driven by 9 members of the committee who made choices based on consensus. Upon entering the Ciba-Geigy company you notice a solid, gloomy brick structure of the building. You get the impression you’re walking into a military institution, and passing 2 guards on your way in (you had to report by each one), does not give you a feeling of ease. The lobby gives you the impression of a formality, as you look at heavy doors, gray walls and uniformed guards. Your impression thus far will be likely different from the open and informal feeling you had at this stage with DEC. You may feel like DEC was more likable and this reaction itself is also an artifact of culture. The personal reaction to Ciba-Geigy is relevant as it can help us understand our own potential bias or inhibitions that may interfere with cultural analysis. When meeting new co-workers, you notice everyone introducing himself by the title and being very polite and respectful in conversation. The corridors are quiet and the accent seems to lie on discipline and punctuality. Having lunch, you observe a fixed setting of tables, giving you a sense of rank ordering or status amongst the group. When late for a meeting even by two minutes, you feel a need to excuse and justify yourself. During the meeting, the managers seem to be very serious, formal and well prepared. Communication is respectful to individual ideas, with no confrontation. Later it becomes evident, that Ciba-Geigy has a reward system for managers which is based on length of employment, general performance and personal background, and not (as in DEC) on performance on a current goal. It seems rank and status plays a substantial role here. During your stay, you learn from conversations with managers, that sending out unasked for information to members of Ciba-Geigy, was considered as confronting and challenging. Suppose that your function was as a consultant. In this instance you might be tempted to send out information and advice to members of the group as part of your tasks. If this would occur, you would unknowingly challenge and even insult the addressee, as this would be perceived as undermining responsibility or knowledge of that person. After time passé, you would inevitably reveal some basic assumptions which in turn, would reveal a framework by which all surface manifestations of culture can be understood. In this case, both companies valued the notion of family. We notice a sharp contrast however, between DEC and Ciba-Geigy. In DEC, family was assumed to include conflict, but essentially, all members were equally respected and kept together. In Ciba-Geigy, the assumption of “family” was also valued, but perceived in a different manner. A family is a tight bound unit, working together, but as in all families, the younger members must respect the older members. Here we also see how authority and confrontation were approached differently between the two companies. Whilst DEC encouraged confrontation, Ciba-Geigy tended to prefer avoiding conflict, and being more respectful to authority. In DEC, truth and brainstorming occurred through debate and confrontation, whilst in Ciba-Geigy its fundamental assumptions on truth delved from its nature as a chemical company, rested on knowledge, experience and expertise which were seen as the foundation and driving force. One of the assumptions of DEC was that if a job was not adequate for the member, the member would be directed to a better suited task. In Ciba-Geigy, the member was expected to persist at the task, and give his or her best. As long as effort was made, the individual would be kept on the job.
As this comparison has attempted to show, basing ones understanding of a given organizations culture on surface level manifestations (such as artifacts, or espoused beliefs) may paint a picture of the reality of the group you are dealing with, but it cannot provide basis for an accurate analysis of culture. It is therefore of crucial importance, to beside looking at artifact level and espoused beliefs (what is observable) to delve deeper and attempt to discover the essential underlying assumptions. Even when we arrive at the basic assumptions level, these assumptions on their own may seem incoherent with one another, even odd at times. But it is the integration of our knowledge on these three levels that can bring forth the core of the organizations culture paradigm.
Culture is a complex concept, which is patterned, pervasive and can be considered independent of morality. Historical experience, such as the backgrounds from which the company was formed, relates to basic assumption formation. Leaders of both companies discussed here were proud of their heritage, assumptions and values and enforced them actively. Given the nature of their function, DEC as an electric company and Ciba-Geigy as a chemical producer, both companies operated within their respective national cultures, or macro-cultural contexts.
The difference in orientation can also shed light on how individual cultures of these organizations have shaped themselves into their present state. It is not news to hear stories in both DEC and Ciba-Geigy of people who have been turned down in their job applications or fired, because their views (may have) challenged or distorted the cultural framework of the organization. Leaders in each company strived to maintain their culture and meet changing environmental needs.
Organizational culture can help us discover the structure of the culture, but it tells us relatively little about how the content of this culture, can aid the group and organization. After all, not all cultural assumptions survive the test of time. Content can best be explained by models from social psychology and our understanding of group dynamics. From this perspective, all organizations can be said as facing two fundamental problems:
Survival and adaptation to its environment.
Sustenance and fuel of survival and adaptation through integration and internal processes.
These 2 problems point to the need to analyze not only the problems the organization may have been facing in terms of adaption/ survival at its origin, but also throughout its existence (as environment is ever changing). Information on circumstances relating to the origin of the organization may in some cases be hard, if not impossible to find. The model of group dynamics, particularly explaining the formation of group identity, operates on the same principle that culture of a given group forms. Through shared experience, values, feelings, ideology and common learning results in forming the group identity. This inherently leads to certain shared assumptions which are what we refer to as the culture of a group. Culture cannot exist without a group. If there are no shared assumptions, we’re referring to a “bunch of people”, not a group. In the discussion about organizations, we try to outline how cultures are formed, how they evolve, and how they are destroyed. After all, we search for not just a description of culture, but its functionality for the group, the occupation of the organization and the macro culture (nation).
Mission, goals and strategy
The problems leaders and groups face regard:
Mission and strategy
Goals and means
Mission and strategy point to a fundamental need for survival of each group in having a purpose for existing, or core mission. For example business organizations mission usually is dependent on economic survival and growth. As a result, this means that attention must be paid to the investors and stockholders, needed material suppliers, the work force, the community and, of course, the customers.
From many studies of organizations, we learn that given the occupation of the organization, and its functionality in a given social context, maintaining a sort of balance between this constellations of factors, is ultimately the key to survival and growth. What the assumptions and beliefs of the organization are and how they integrate together, is then a reflection of this balance. Focus on a single factor will not suffice. Religious, educational and governmental institutions can be said to clearly have different core missions. But these missions derived from the balance of different need factors forms a logic by which that particular mission is carried out in.
Manifest and latent functions
Functions of organizations can be manifest (publicly justifiable) or latent (or silent). A school for example, has the manifest function of providing education to children. Closer analysis reveals additional latent functions (within this manifest function) such as to hold adolescents off the streets and job market until they gain skills. Another latent function may be to group the next generation on basis of skills and talents which are needed by society. This leads us to understand that core missions, bring a multifunctional issue.
Many of the most important shared assumptions involve means on how to carry out latent while protecting or shielding them from manifest functions. Ciba-Geigy for instance, provided career advantages to Swiss nationals (this would never be publicly admitted though). One of the latent functions was to maintain this trend. Mission refers to an organizations fulfilment of its manifest and latent functions, as well as future planning hereof. The decisions derived from this about products, services, consumers etc can be said to be the identity of that organization. Identity may be rediscovered.
General Foods for example, has faced criticism on the nutrition of the food products they made. The accusation was that their products taste good (due to artificial flavouring and high sugar content) but has no nutritional value. At this point General Foods responded by increasing their production of healthier foods, yet found that these new products did not sell as well as the less nutritious products before. This sparked debate on the identity of the company. Were they a “food” producer, or did they just make consumer oriented edible products (as long as it tastes good), or both? When identity became questioned, the topic at hand went beyond the mere economical survival of General Foods. In this situation subcultures may arise, arguing their point for a new reference. In the case of General Foods, the market oriented subculture has argued their case successfully, and the company, having discovered that nutrition was not fundamental to identity, focused their production around consumer oriented edibles business identity.
Goals derived from the mission, are based on consensus regarding core mission and the identity. But this does not mean that key members will automatically have common goals and that subcultures will align together for the execution of the mission. In order to reach such a consensus the group requires communication, as well as shared assumptions regarding the operant logistics which translate an abstraction like mission into concrete targets of design, production and sale.
Goals - make the mission concrete and ease the decision making process. While missions may be timeless, goals need to be fixed in time (today, next month, next year). Identity and mission or strategy issues are usually worked out as annual or long-range targets. It is important to distinguish between long term goals and short time fixed goals. The latter serves as an operationalization of the mission in a current, potentially problematic situation.
Structure, systems and processes
Assumptions regarding means to reach the goal as well as those regarding the way of working “correctly”, are examples of the most implicit elements of organizational culture. Leaders attempt to introduce and maintain structures, systems and processes. If these prove successful they become accepted in the group and together begin to form elements of that culture. Processes which are accepted in this way by a group are not just directed by the vision of the leadership, but also by the needs and likes of the macro culture in which it operates.
To recap, consensus is needed for goals to be reached (and processes to be developed in order to do so). This consensus is often facilitated and derived from common perceptions of structure and framework in organizational cultures). For instance, if asked to create a company selling birthday cards with no more than 15 employees, you might appoint, manager, advertising, design, writers, evaluators etc. In fact what may be needed for success in terms of profit (if this is our goal) is to have 15 writers and no other staff, but due to our conception of hierarchy in organizations from our own cultural background, we may have failed to realize this. Consensus creates behavioral patterns and artifacts and also helps to integrate skills and knowledge (or coping efforts of the organization regarding the environment) in line with the culture, should these prove successful. The development of means by which a group tries to reach its goal or mission, tends to solve a lot of internal problems the group may be having. External problems regarding positions and authority are largely resolved by the division of labour.
The formation and regulation of internal processes and interaction with the environment thus forms a framework in which the means to the goal can be defined. In turn the adopted means may be adopted into the culture with sufficient consensus. Think of for instance Ferrari, where the consensus around the method of manual assembly has become a defining feature of this organization (at least in the mind of most customers).
Ciba-Geigy was dominated by the belief that individual expertise should be given privacy, so that it may blossom to the full potential. The individual was thus expected to achieve mastery and nothing short of it in his given field. Intrusions such as unwarranted advice or meddling were considered insulting. We can see this deriving from a historical context. As a scientific oriented organization in the Swiss German macro culture, Ciba-Geigy’s culture adopted many of the hierarchal precision that one can find in sciences. In turn, this defined physical space within the organization, the budget and subordination.
DEC – on the other hand – rooted in engineering, was much more open to innovation. Discussion and debate were encouraged, resting on the premise that no individual alone is capable of full understanding. Consensus was thus often lacking and this created frequent disruption. DEC later hosted meetings to agree on policy consensus. Interesting enough, these have lead to the reinforcement of the current – ambiguous - rhetoric.
Measuring results and correction
Every organization in order to function optimally and efficiently must devote effort to periodical evaluation of their performance. For this measurement, consensus is necessary regarding the object of measure, how something will be measured, and how potential errors may be corrected.
Evaluation is necessary once the group is performing, not only to establish the quality of performance, but also to derive means of improving error and dysfunction/ inefficiency. This can take several forms. For instance, at DEC, projects were explicably connected to whether engineers approved of the product. This operationalized the assumption of internal acceptance as good substitute for external acceptance. At times when several engineers approved of various project, it was adopted to let the decision rest on the market.
These two forms of evaluation worked in unison. Conversely, in a French brandy maker company, the product was evaluated by experts at each step to be finally evaluated by only male offspring of the previous taster. In this way, the final product was evaluated several times before reaching the end of the line. Evaluation can come in diverse forms; some organizations encourage personal judgment as basis for decision-making, others rely on market evaluation and some prefer referrals to superiors/ experts/ colleagues.
When an organization has no consensus on how to measure performance, it will be unable to successfully identify and correct its faults and mistakes. A lack of consensus also took place in Ciba-Geigy. The pharmaceutical department evaluated itself by internal comparison to lower departments. The management however, evaluated the pharmaceutical department compared to external counterparts in other firms. The end result was that the department itself viewed itself as outperforming the other departments, while the management say it perform poorer than equivalent departments in other firms. In times where consensus is lacking, we can often observe the rise of subcultures, oriented around different assumptions. The agreement should involve as much the criteria for, as well as means of obtaining information.
In DEC, the CEO would often walk around and consult individual members about various projects. Managers were entrusted to evaluate their divisions on their using their own judgment. Informal measure was thus valued higher to more formal, bureaucratic evaluation (e.g. financial institutions). In Ciba-Geigy, there were weekly, monthly and annual reports being sent to a number of departments, with strict structure and occasional visits from monitoring teams. Informality was seen as unreliable and so less acceptable. The choice of criteria and measure systems, a particular organization adopts is become important features of its culture when consensus around them is reached. Failure to do so can result in subculture formation around differentiating assumptions, leading to potentially poorer adaptability to the outside environment.
Remedial and repair action
Companies are at frequent risk to suffer at the hand of ever changing internal and external complications. The shares might plummet, major customers complain about the quality of the product, a group of executives abandons their function in a short period of time, are just examples of every day challenges. Crucial to adaptation, is consensus on how to deal with a change once it occurs, as well as how to correct this change. The 2009 case of Toyota vehicles illustrates well how macro cultural and corporate influences in dealing with the loss of face regarding flaws in their product.
Firstly, denial of the problem took place. Subsequently, Toyota moved on to attempting to minimize costs of fixing the problem, only to move to apologies and acceptance of full costs of repair. Looking at this pattern of response, we can deduce that there was little consensus on how to deal with the change. The only consensus that was there was that of not wanting to lose face.
Gathering information, publishing it through the organization and integrating it into the production process, are ingredients for effective remedial action. Once information is obtained and spread throughout the organization, there is still a challenge in reaching agreement as to what steps to take. If a product fails, should we fire the project leader? Reassess our method? Inspect the research department? Lay low? Organizations may display an array of mechanisms involving these choices. Ciba-Geigy took action locally, as it was preferred those bad news not travel up. In the case of a major problem, a diagnostic task force would be summoned to investigate. At General Foods, when demand for the product dropped (or the product failed), the assumption was that a modification to the product could restore sales. In effect, this lead to significant effort invested in making failing products “work”. Eventually the management had to introduce tough criteria and ordinance, to cease production on several products – despite conflicts of ideology. When we speak of correction we not only refer to dealing with adversity. Successful organizations face choices of for instance, controlled growth, faster growth or all or nothing risks. Consensus on issues such as these is a vital element of effective functioning.
We see a number of strategies aimed at dealing with changes in companies that have undergone problematic periods in their history. The gathering of information is an ongoing process and should also take place after evaluation/ correction. Doing so will establish how well the intervention or action has worked, and is needed in sensing and predicting changes in internal and external environments. How external issues are worked out influences the integration of the group. Organizations can be seen as socio-technical systems, meaning, that external adaptation and internal integration issues as well as their solutions are intertwined and integrated. This further illustrates culture as a complicated, multidimensional process. The effort of the group to adapt, survive and grow reflects culture as through a learning process. The leader’s role is to manipulate and steer the system to meet internal and external demands. Failure to meet internal demands may be forgiven, but failure to meet external demands, usually results in expulsion. In this sense, we can see social technical systems as, in a way providing a framework for evaluation of leadership.
So far we have discussed, that as part of survival, organizations face external issues with the environment as well as internal issues within the group. Both deserve attention as they co-occur in time, but for leadership, it is important to distinguish at which point where to devote attention and effort. The management of balance between task dimensions (as described in previous chapter) and group and interpersonal dimensions is inherent to the role of leadership.
The primary ingredient to functioning as a group is adequate communication between its members. This language must accommodate goal formation and perception of current events. It also classifies our perception into categories, which in run allow for coordinated action. Abstractions can be defined and labelled in content, such as the terms “good quality” or “low cost”. If these systems of categories are not in unison between members, the likelihood to reach consensus is seriously reduced, not only with regards to the undertaken action, but also regarding definitions, and interpretations of the real. Members of a group usually can come from the same culture, and so communication is warranted. As groups grow, many develop specific terminology regarding action, gesture or speech of that group’s occupation. A professional “jargon” if you will. In this way, language can influence the complexity of a given culture. Attention should always be paid to terminology which is absent or incoherent across different cultures, to avoid misinterpretations and issues.
Defining group boundaries and identity
Fundamental to group functioning is a clear definition of who belongs and does not belong in a group. The formation of inclusion and exclusion criteria is fundamental. New comers cannot function effectively if they are confused as to the identity of the group, and a group is unable to function effectively without a clear definition of itself and its bounds. Inclusion criteria are initially formed by the founder or leader, but are inevitably subject to analysis and consensus of the group. Asking members how they envision new members will often reveal some core assumption of the group. At Ciba-Geigy, a primary inclusion criterion was prior education. It was expected that the individual understand the scientific base of the organization. Doctorate holders received preferential treatment, even for management or marketing positions. Criteria referring to defining who is in or out are not exclusive to newcomers. They are reflected in differential treatment within the group. Organizations can be said to have 3 dimensions of career mobility:
Lateral movement (between functions or tasks).
Vertical movement (between ranks).
Inclusionary movement (between outside and inside).
Defining inclusions and exclusion criteria is a great way to begin cultural analysis. This making of these criteria is in itself a process by which culture is formed and maintained, and consequently, how forces of external survival and internal integration issues interact. In today’s globalized society, individuals belong to many organizations and so their identity is not necessarily tied to one. Think for instance of the growing amount of temporary workers (temps).
Power, status and authority
The process of distributing power and authority is a complex one. In new groups, authority is usually established by the one who is most dominant and/or influential. Organizations however, tend to be started by leaders, who usually have a preconceived image of how the group should be run. This view is then translated into authority and develops with the group across time. In DEC the notion of power was attained from networking and personal achievement, while Ciba-Geigy employed a strict and formal system of allocating power, based on background, education, performance and loyalty. Technical function and occupation of each individual company, has shaped the structure of authority and distribution of power. This can be seen as another manifestation of the earlier discussed interaction between external survival needs and internal integration needs. Manners, morals and politeness fostered by a given macro culture, help to support and maintain the distribution of power. In a way, conflict always brings about a certain degree of (negative) emotionality. Social conformity to rules of general conduct helps us avoid conflict, by for instance laughing at an unfunny joke, to save the person the embarrassment or frustration. The same is true for organizations.
The ultimate goal of these norms is to create an environment with as little anxiety in interaction as possible. These norms, if present over time, may become engraved in the culture of the organization. In today’s globalized world, we notice a greater variety in members under ethnicity, nationality and occupation. It is the challenging of the deepest assumptions of authority amongst these members can be a difficult task. This brings another role of leadership to light, namely that to create cultural islands, which enable members to explore their differences and reach consensus on managing authority in relationships.
Rules for relationships
Creating rules of conduct with one another is crucial to the functioning of any organization. While authority issues refer to the handling of feelings of aggression, relationship issues refer to the handling of emotion and sexuality. Societies develop rules for gender roles, friendship, sexual conduct and kinship while enabling procreation to warrant survival. In family run firms, we often notice a dual intimacy system – where a greater deal of trust and intimacy is given (more often implicitly) to family members, compared with non-family members. One reason for this is that newcomers may be said to have different family experiences and modalities, and bringing these in may be disruptive, explaining the greater intimacy for family members. In organizations, intimacy covers a wide range of issues such as how to address one another, how much personal information can be shared, who to ask for help etc. In most organizations rules regarding relationships are closely tied with those of authority. New members quickly learn who the boss is and who we can joke with. In other organizations, bringing in family members is forbidden, as it is perceived that family loyalty may interfere with company loyalty by introducing incompetent members. Rules for relationships also interact with rules of task performance, especially in a multicultural setting. Some members may view a certain level or intimacy or interpersonal contact with their colleagues as necessary before attempting a task, whilst others see performance as independent of social relations with colleagues. This adds another task for the leader, namely to be aware of these differences and create opportunities where the issue can be approached and worked out.
Rewards and punishment
In order to maintain a set of norms or rules, every group must implement punishment and reward. Consensus must be formed on the nature of the punishment/reward as well as their basis. The reward/ punishment systems are one of the easiest and fastest ways of bringing about behavioral change and so also the first to change elements of the culture. General Foods adopted a norm that after 18 months of competent work, a manager could hope to move up the ladder. Consequently, managers who did not move after this period felt they were not performing adequately. In Ciba-Geigy, a pat on the back from a respected member, compliments, or moving up to a bigger project were seen as rewards. Various forms of punishment exist. Some organizations develop “blame cultures” responsible for norms that in case of a problem, place an accent on finding the responsible party. The signals of punishment or reward are hard to decipher for a new comer, as they are often ambiguous. Rewards/ punishments, together with assumptions about intimacy and authority form the critical mass of culture. As organizations become increasingly multi-cultural, these rules and their integration becomes of key importance.
In order for groups, societies and so, inevitably culture to form, the members involved need to agree on a number of fundamental issues. As the group/ culture evolves, consensus is required for managing external and internal conflicts. The resulting assumptions however, cannot exist, if agreement is not reached amongst more abstract issues and assumptions thereof. The understanding of the following domains must be agreed upon before further evolution can occur:
Reality and truth
Time and space
Human nature, activity and relationships
Nature of reality and truth
Assumption about the nature of reality and of truth provides members with a framework on how to select relevant information and, how to interpret information. Assumptions about reality and truth also help members to determine whether enough information has been obtained to act or not and how such action should look like. In DEC we observed reality and truth as defined by discussion as well as on basis of what worked. If objective testing was not available, the idea had to survive debate and criticism in order to gain acceptance. In Ciba-Geigy, reality and truth were bound more closely with empirical data, rather than personal expertise or advice. Note that both companies operated in the western macro-cultural context, which is largely dominated by empiricism. Yet even within this macro-culture, there is a substantial differentiation of defining reality and truth. The assumptions regarding reality can best be understood as operating on a number of levels. These are as follows:
External Physical Reality – refers to things that can be tested in a empirical manner (e.g. two individuals arguing over whether a rock can break glass, can throw one at a window and find out). The boundaries of external physical reality tend to become vague and differ substantially between cultures (e.g. if two people are arguing about which political party to vote for, setting up
Social reality – refers to matters that are not empirically testable, but instead are agreed upon by consensus amongst group members. The correct manner of interacting with another human being, ideology, assumptions about the meaning of life, group boundaries and culture itself – are examples of matters which cannot be subjected to scientific analysis and must thus be agreed upon. Often times it is difficult to distinguish where the borders of the physical and of the social reality end. Democracy operates by majority vote, despite there being any empirical evidence for this criterion.
Individual reality – refers to things learned from personal experience, which hold an absolute truth value for you, regardless of whether others share the same view. In traditional authoritarian societies, we may base our truth on the whim of the elder or leader, whilst in individualistic societies, truth may be subjected to analysis and require proof before being admitted to one’s individual reality.
Physical, social and individual realities are inherently derived from social learning and so form a part of a culture. Today, many organizations host a variety of individuals from all over the world. Each such “foreigner” can be seen as bringing in his own individual reality into the workplace. It follows that this may lead to problems if the individual reality of someone is distant from, for instance – the social reality of the dominant group/ culture. In order to overcome these obstacles, it is important to establish good communication – inevitably to reach a greater understanding of each other’s behavior and intent. Organizations may (and should) provide opportunities for members of the group to explain their behavior and motives, whilst offering space for the integration of the concept of reality of others. These opportunities or situations can be referred to as cultural islands.
High and Low context cultures
Hall (1977) pointed in his work on the Maruyama’s that cultures may differentiate in context, between unidirectional, and mutual causal paradigms of culture -or- high context and low context cultures. In high context cultural paradigms, events are seen as having universal meanings. In low context cultural paradigms, events cannot be understood without looking at the context, categories and causality revolving around the event. DEC is a good example of a high context culture. If the CEO was ever found to criticize an engineer, the opinion of the observers would argue that he is only doing so, because the engineer is a worthy individual who the CEO has high expectations of. In Ciba-Geigy, we see a rather low context culture. Here, messages tended to have the same meaning, regardless of who they came from.
Moralism and Pragmatism in reality testing
England developed the following approach to reality testing in his study of managerial values:
Moralism – seeking validation in general philosophy, tradition or moral system (e.g. Ciba-Geigy).
Pragmatism – seeking validation in own experience (e.g. DEC).
Applying each dimension may highlight the base on which truth is established. Below are a number of possible criteria for determining truth:
Pure dogma: truth derived from tradition and/ or religion (“It’s Gods will”).
Revealed dogma: truth derived from trust in and wisdom of authority figures (“He has more experience, let him do it”).
“Rational-legal” process for determining truth (“We should let the boss decide, it’s his field of responsibility).
Truth derived from debate (“If it survives the arguments, it’s worthwhile”).
Truth derived from pragmatism (“Let's try doing it like this and see what happens”).
Truth derived from empirical methodology (“Results suggest truth.”).
Note how point 6 is similar to some extent to point 1. This dimension approach is also useful because it relates to the tolerance of uncertainty, as mentioned previously- a crucial feature of adaptation to the environment. As an organization matures it faces and increasing amount of environmental and internal pressures. These require leadership to display a larger tolerance for uncertainty in order to successfully cope and hence, be better adapted.
Reality testing done by a group, requires consensus on what constitutes information and knowledge. We can imagine that market/ business planners for instance, will know the size of the market, which price is adequate for profit, trends etc. The engineers involved with the same product, will know the size of the product, technical specifications and so on. Each group may use its own terminology or conceptualization of what is information, and so integration of these differences into a combined whole, is a significant task for leaders. Overall, in today’s world of growing digital information exchange, where Wikipedia is on the foreground, while encyclopaedias disappear, we can claim to be heading more in the direction of DEC (for better or for worse), in relying on debate and critical analysis in order to define truth.
The understanding of the deeper structure of culture cannot rely solely on definitions of reality and truth. In addition, this analysis also needs to entail how perceptions of space and time are organized and integrated.
People differ in their experience of time. You may recall feeling annoyed or even angry when a friend arrived late at your meeting. This is just one example showing the significance of impact that time has on our functionality. In contemporary organizations, time is seen as imposing a structure, consisting of workdays, calendars, life cycles and careers – which we learn and adopt into our culture (and our individual lives.) Time can be analyzed from the following perspectives – these are discussed below:
Past, present or future orientation
Mono-chronicity or poly-chronicity
Planning or developmental time
Symmetry of temporal activities and pace
Basic time orientation
Every culture creates assumptions about the nature of time. These assumptions create an orientation involving the past, present or future. For example, Kluckhohm and Strodtbeck found in their study, that Indian tribes lived mostly in the past; Latin-Americans were living mostly in the present, whilst Anglo-Americans were strongly oriented toward the future. Companies time orientation, may involve past issues, current issues (such as tackling a current goal), future orientation (quarterly results); and long distance future orientation (research and future growth)
Mono-chronic and Poly-chronic time
Several works point to the managers in the United States viewing time as monochromic. Perhaps the easiest way to understand what mono-chronic perception means is to envision a ribbon line. Time is a continuous line, which we divide into (for instance) compartments, appointments and schedules. This enables us to fit many tasks in – say, 1 hour’s time, yet the allocation of time is such that each task is done independently. The time is thus segregated sequentially. Poly-chronic regard of time is more commonly seen in Europe, Africa and the Middle East. It entails synchronicity and synthesis and regards time as a medium within which the accomplishment of tasks weighs heavier than the clock.
It is interesting to look at both forms of time perception across cultures, especially in macro-cultural context, such as that of nations. How a culture views time is inherently related to other aspects of culture such as that of relationships. Companies like the DEC who value relationships higher over personal efficacy, tend to be more polychromic. Ciba-Geigy may value punctuality and self efficiency more, this reflecting a more monochromic approach. Conceptualization of time may also influence display of status. In some cultures, jumping the line in a post office for example, may actually lead to quicker service. The clerk may be more poly-chronically oriented and decide that serving the line jumper may benefit the process as a whole. In other cultures, jumping the line is considered rude and disrespectful, and may attribute to lower status perception.
Subculture variation on time
Studies of biotech companies revealed frequent misunderstandings between entrepreneurs from a biological background and managers with economic background. The biologists viewed time as developmental time, meaning that things were given time to progress logically in time, as they would in nature. The managers, in contrast were found to be much more mono-chronic in their perception, setting clear targets and milestones tied to the external market. The latter form of time is planning time.
Time horizons and degree of accuracy
Another dimension of time which requires consensus in a group is the amount of time units in relevance to a task. Measurements can occur daily, monthly, quarterly and must adhere to a certain degree of agreed accuracy (also relevant to the task at hand). Oftentimes – as was also the case with DEC – many companies feature complaints of the sales departments targeting research/ manufacture departments, for being late with product delivery. It is conceivable that when a sales person agrees on swift delivery with a scientist, he or she may mean 4 months, whilst the scientist defines “swift” as taking between 6-12 months. Different time horizons are thus often the source of misunderstanding and potential conflict. Ciba-Geigy (most likely due to its scientific ancestry), adopted a much more developmental time approach in as much developmental as sales and marketing departments. Time horizons differ by function but also by status or rank. Following on, a trainee may be subject to daily evaluation, a manger to monthly evaluation and a CEO or director may be reviewed on performance once every several years.
Temporal symmetry and pacing
This section deals with the aspect of time regarding the pace of activities. In a study of radiology departments, Barley (1988) concluded that the pace of radiologists and technicians became more symmetrical with the introduction of technology. Before, radiologists and technicians – depending on nature of task – may have required each other’s assistance, having to spend time on finding one another within a company and then winning each other’s time. The introduction of computerized tomography, magnetic resonance imaging and ultrasound helped to align the symmetry by giving each function more independence of one another. In this way mono-chronicity was achieved for both functions to bolster productivity. When individuals sharing poly-chronic perceptions meet with mono-chronic perceptions, at least one will be left unhappy or frustrated. It is thus important to think how these two subtle aspects of time, interact in the context of a given task or function.
Nature of Space
Space is yet another subtle aspect of organizational culture. Similar to time assumptions, assumptions about space tend to be taken for granted and play a role in the subconscious. Despite its subtle nature, infringement on space can lead to strong emotional reactions. In some countries it is considered a violation to cross a walking mans path, whilst in Asian communities space is defined by communality.
Space can be understood as reflecting physical and social content. It is not enough that we are able to manoeuvre ourselves in relation to other objects; in addition we must determine consensus on spatial bounds in relation to other people. In the US, there seems to be high consensus on 4 “normal” distances and variations between near and far within them.
Intimacy distance: a distance we observe when intimate with someone such as touching.
Personal distance: this is the range in distance which is present when engage in conversation with another individual or group.
Social distance: this distance involves how we approach several people at once, for instance at a table at dinner.
Public distance: at this range, audience is undifferentiated. We gaze around without really focusing on anyone.
Feelings associated with space have roots in our biological foundation. Organizations have varying definitions of space. In DEC, we encountered an open form of layout. In Ciba-Geigy on the other hand, the offices were aligned along a hallway, with heavy doors isolating each space from the rest.
Space is always allocated in an organization. This allocation is itself a manifestation of cultural assumptions and values. In this form, space is often shaped according to status and rank. In General Foods, office space was made of movable walls, which would get adjusted depending on project status and individual achievement. DEC tried to reduce the status and ranking division of space, by not allowing private parking spaces to its employees. Employees were also free to decorate their office spaces in any way they liked – a trend uncommon in most organizations. Similar to interior design, the architecture and allocation of building space of an organization, eventually becomes a powerful builder and reinforce of that organizations norms.
Another subtle use of space is reflected in body language. How we communicate using our bodies and what message this will produce, varies across cultures. For instance when a boss walks in to the meeting, employees may stand up. The way leaders bring their assumptions about time and space to light, trains subordinates and ultimately leads to the acceptance and engraving of these assumptions. Gestures have symbolic meanings in each culture and so one should be cautious when attempting to draw conclusions from such artifacts and know the limitations of perceiving through one’s own cultural lens. This applies as much to concepts of Time as space, both being invisible concepts, often subject to misinterpretation by an outsider.
At the organizational level, assumption about human nature within the western tradition, have evolved to the following:
Humans are rational-economic actors (operate out of self-interest).
Humans are social animals with primarily social needs (operate for good of others).
Humans are problem solvers with primary needs involving challenges and need for self-actualization (operate for development and growth of self).
Humans are complex and malleable (complicated and fragile).
Early theories of motivation were predominantly revolving around financial benefit (self interest). Employers thus believed that the fundamental manner of motivating subordinates was with financial rewards. Since the introduction of the assembly line, the focus has shifted to individuals as requiring and even “craving” challenges and opportunities, ultimately aimed at self development. Maslow described self actualization as the final stage of psychological development, which can only be attained if remaining lower order needs are met. The most recent conceptualization of human nature is that it is too complex to be described by a universal definition. Instead, human’s nature today is best understood in terms of variability. Variability refers here to changes of our motives, as we mature and grows; as well as variation in social conditions, which enable us to learn new motives, in accordance with social requirements. The variation itself is yet another factor outlining the importance of consensus regarding assumption, so that variations can be successfully incorporated and embedded, while misunderstandings and conflict are reduced. Human nature as malleable implies that humans adapt to assumptions others hold of them. Managers who are inflexible in the sense that they believe financial rewards leading to motivation, in the long run, prove ineffective. McGregor refers to inflexible managerial assumptions as Theory X. Leaders, who attempt to account for as much human variation as possible within their organization, promote the cohesion of the group. These managers share an assumption denoted as Theory Y. DEC was a clear cut example of a Theory Y organization, were the individual was ultimately more important than the organization, whilst Ciba-Geigy was closer to Theory X, the good of the organization always outweighing that of the individual.
Human activities are shared assumptions about appropriate ways for humans to interact with their environment. These assumptions are closely bound to assumptions on human nature. Herein, we can distinguish several forms of orientation of human activity:
The Doing orientation: taking for granted that the correct manner for individuals to act is to actively control and manipulate their environment, and consequently their lives. Doing is a predominant orientation in the US. DEC is again a prototypical example, to taking action and “doing”. If a problem occurred one was expected to get involved, help out, involve others and so on, but not to remain idle.
The Being orientation: this orientation entails nature as a superior force to that of human existence. The focus here is on the present, enjoying what is now, and accepting whatever may occur. Organizations where these assumptions are at heart, usually attempt to adapt to external realities rather than create new markets or otherwise manipulate the environment.
The Being-in-Becoming orientation: idea that individual must attain union with the environment, by developing and perfecting their capacities – this ultimately leading to harmonious coexistence. Development is a key feature. DEC promoted self development, even if the company as a whole was becoming economically dysfunctional. Ciba-Geigy however, socialization into the existing work model was emphasized stronger than self development.
Every culture at its core features assumptions on how to interact with other members to yield security, comfort and efficiency. New members develop questions about how to act in a new function:
Identity and role – Who am I in the group and what is my function?
Power and influence – Are my needs for control and influence met?
Needs and goals – How close are the goals of the group to those of my own?
Acceptance and intimacy – Can I be accepted, respected, and loved here?
As long as these questions remain unanswered, preoccupation and tension will prevent the individual from fully devoting him or herself to the work. Every nation, organization or group develops means of answering these questions. Macro-cultures tend to shape solutions to these questions through socialization and education. Rules of authority and intimacy are important shapers of social order, relating to the basic identity of the group’s members.
Individualism and Collectivism
Nations and ethnic groups differ in their perception of the ultimate unit of society as either the individual or the group. Research shows this difference to be a characteristic feature when differentiating nations.
Individualistic societies – define roles in terms of personal achievement, limit aggression through personal competition, reward ambition. Love and intimacy are defined as very personal terms.
Collectivistic societies – define identity and roles in terms of group membership, reduce aggression by targeting (primarily) other groups, place less emphasis on ambition. Love is “funnelled” within the group.
Countries differ in the degree to which individuals (within a hierarchical situation) perceive their ability to control each other’s behavior. This dimension, revolving around the issue of management of aggression, is called power distance. High power distance countries (e.g. Mexico, Venezuela) perceive a greater gap between superiors and subordinates than low power countries (e.g. Denmark, Netherlands). DEC was very individualistic yet it accounted for the power distance between the leaders and subordinates with its assumption that “good ideas may come from anyone”. Ciba-Geigy, on the other hand, placed much more emphasis on hierarchy and collectivist mentality. Recall that the organization always outweighed the individual in the end. All meetings had to be structured, planned and organized, whilst at DEC if you had an idea, you could swing by the CEO and let it out.
Relationships between individuals involve varying degrees of:
Emotionality – is the relationship professional or emotional (friendly)
Specificity vs. diffuseness – is the relationship tied to a specific reason (e.g. sales-customer) or more diffuse (friendships)
Universalism vs. particularism – are people perceived according to universalistic values (e.g. stereotype) or is the individual viewed for his unique features?
Status ascription vs. achievement – is status and achievement ascribed based on birth or relationship or on personal achievement?
Macro-cultures vary in their conceptualization of these degrees of relation to roles and this may breed miscommunication and problems in multicultural organizations.
Typologies are categorical classifications every human has in relation to understanding the world around him. Categorization, through abstraction, help us make sense and see order in what we perceive, define the underlying structure of the phenomenon (allow theory forming) and enable us to make predictions (to some degree). Categorization runs a risk however, of oversimplification. Organizations further face the challenge of arriving at the level of abstraction within their group. Usually, surveys are scattered, where members can write down their perception of the organization. Through factor analysis, this information results in an abstraction for the entire group. For instance:
To measure the dimension of “strategic direction and intent”, a combination of employee ratings on the following factors is applied:
Long term purpose and direction
Other organizations change the way they compete as a result of our strategy
Clear mission providing meaning and direction
Clear strategy for future
Our strategy is unclear to me (reverse score)
While the above could provide a reliable and valid measure of an organizations perception of its strategy, the usage of surveys may yield problems when attempting to measure culture. Some of the common issues from usage of surveys are:
Choice of questions (if we are unaware of the cultural values and assumptions that exist).
Lack of motivated may result in less honesty.
Misinterpretation or misunderstanding of the questions.
Measurement may be accurate but not related to culture.
Impact of the survey and/or its results.
Surveys should thus be used cautiously when attempting measure elements of culture within an organization. Despite some problems associated with surveys, they have a number of useful features in:
Determining whether a given dimension of culture is (systematically) related to an element of performance.
Providing the organization with its own profile, thus stimulating reflection on own values.
Comparing organizations between each other on certain dimensions (e.g. preparation for mergers).
Educating members on certain dimensions that management wishes to develop.
Typologies focusing on assumptions of authority and intimacy
Organizations are results of individuals working for a common goal. The relationship between the individual and the organization is a fundamental dimension of culture. Etzioni differentiates between three types of organizations:
Coercive organizations (prisons, mental hospitals) - Individual is bound by physical or economic reasons and must accept whatever mandate of the authority. Evolution of culture in these organizations usually breeds (through intimacy) strong counter cultures amongst participants (e.g. labor unions). Authority is arbitrary and absolute.
Utilitarian organizations (business companies) – Individual abides by rules necessary for performance of the organization and receives fair compensation. Authority is negotiated relationship. Peer relationships revolve around task performance, and close relationships are seen as hindrance to task focus.
Normative organizations (schools, NPO’s) – The goals of the organization are the same or close to the individuals’ goals, and so he or she contributes and accepts legitimate authority over the job. Authority is informal and subject to individual consent. Relationships evolve around goals and in support of the organization. Closer relationships are seen as bonding forces.
Types of organizations are important to remember, as they vary across macro-cultural contexts. Business organizations in Western societies, though they may hold high power distance culture (which is essentially coercive) may opt for a more negotiating, utilitarian type. The Asian business culture – as an example – is predominantly coercive, and this organization is necessary to be effective. A common mistake is for Western societies, imposing their typology onto a culture, which is inherently different in its approach.
Typologies of authority:
The choice of authority typologies, always involves the leaders assumptions about human nature. If a manager is untrusting of his employees (Theory X), autocracy may be his or her choice. If one believes that individuals aim to develop and grow (Theory Y), may opt for participative approach, or modulate between them to meet his assumption.
Typology of Corporate Character and Culture
Organizations, regardless of culture can be said as having to be both collectivistic and individualistic to meet internal and external demands. How an organization achieves this balance, forms the corporate character of that organization. Harrison classified four types of cultural essence in organizations by looking at the function as focus:
Power oriented organizations
Achievement oriented organizations
Role oriented organizations
Goffee and Jones, viewed character as a clear expression of culture, and outlined dimensions of solidarity and sociability. These dimensions were used in analysis of 4 types of culture:
Fragmented (low solidarity, low sociability)
Mercenary (high solidarity, low sociability)
Communal (low solidarity, high sociability)
Networked (high solidarity, high sociability)
Data for such typologies is usually collected through surveys. Even though the typologies as mentioned above may hold some value in the categorization of cultures, it remains vital to remember, that these typologies are better seen as indicators, rather than fixed definition of the character of an organization.
Another approach to classifying corporate culture is by using survey based profiles. This method works well in outlining crucial dimensions of culture, and relating them to performance, while focusing less on actual typology. En example is Denison’s survey of 12 dimensions under 4 main scales (mission, consistency, involvement, adaptability). The results can be then compared to performing or underperforming profiles (with a certain level of distancing regarding interpretation).Other approaches include the usage of a priori criteria for culture evaluation. Inherently, classification of culture on basis of individual survey responses is always questionable, as whilst one’s answers may be honest and the survey measures valid, they may reveal little on the real essence of culture.
The assessment of organizational cultures is not an easy task, and required in depth analysis. We may wish to perform such analysis to satisfy our own curiosity, or to discover elements of our new working place, for instance. Although in the latter example, you wouldn’t need to know everything about the culture to fit in, you would need to recognize at least some features of this culture, relevant to your task. You may being to decipher an organization by the following ways:
Visit and observe
Ask insiders about their ways
Identify espoused values (which appeal to you), and how they are placed within the organization
Discover and understand inconsistencies
Determine which deeper assumptions play a role in the observed behavior
Best way to go about this, is simply asking around. When something about the culture captures our interest (e.g. “we are all a team here”) – ask about examples.
Occasionally one may be required to perform research within an organization on a given feature or task. It is important to remember, that the data is subject to bias. Individuals have a tendency to resist or hide information they feel defensive about and aim to impress the researcher often. The information we obtain, must thus be structured in a way that places as much emphasis on “telling things how they are” when asking others for information. Don’t forget, your quest for information, may very well yield aversive perception of your role. Some individuals may see you as a spy, suspect you are an incognito management individual and so on. Thus, the questions you ask, who you ask them to, and the data you collect are all intrinsically tied to your relative distance to the culture of the company. If you are outside of the company, the research may stretch to demographical or ethnographical nature, based mainly on observations (taking pictures of the site, observing myths, rituals, and symbols). If however, you have worked in the company and established yourself as part of the group, the research may entail deeper processes aimed at developing the organization (statistical quality control, contract research).
Semi-structured interviews and assessment batteries may be useful when obtaining information from informants. These methods however, also rely on the balance between what you want to find out, and what others are willing to release, and so are not free of bias or error. They are useful means when your involvement in the organization is at medium level.
When an organization requires assistance or help from you, several methods may aid you in arriving at deeper cultural assumptions. Examples are process consultation, organizational development and clinical research. If members have initiated the research (joint responsibility), or view you as a helpful factor, they will provide you with accurate information. Nevertheless, the data obtained is subject to 2 primary validity issues:
Factual accuracy – based on historical data gathered. Can be checked by means of multiple sources and replicability.
Interpretative accuracy – representation of cultural phenomena in their essential meaning, not projection to own interpretation. Valid interpretation should be reflected by similarity of findings between independent raters as well as generate a given amount of predictability regarding the issues.
The clinical model thus arrives at 2 fundamental assumptions:
Study of human system is impossible without intervention.
A human system can be fully understood by attempts at changing it.
Ethical issues and risks in deciphering culture
Deciphering culture hold a number of risks, of which both the member of the group, and outsider, should be aware. These risks differ depending on the nature of our analysis and its purpose.
Risk of analysis for research purposes – Revealing and organization’s culture to the outside world may make it vulnerable. There can be various reasons for which an organization may not want to reveal all information. If the analysis is published without communication with the organization as to its content, it may produce aversive consequences (false image for customers, misrepresentation and hence frustration of the members of the organization etc.) The best manner to overcoming this risk is to run the findings of your analysis through the organization, before having it published. Nevertheless, the ultimate ethical responsibility lies with the researcher to determine what impact his analysis may have on the organization it entails.
Risk of internal analysis – In order to discover ones capabilities and evolve, organizations ultimately must analyze their own cultures, to drawn on implications for the future. However, this assessment could be incorrect (based on incorrect assumptions), or it could yield results which the organization is not ready to face. Relying exclusively on survey data for conclusions on the essence of culture in an organization, (as mentioned previously) could fall trap to this risk, and cause harm. Results of analysis are usually presented to a group (e.g. board of directors, management). It is important to remember, that when we speak to groups (as opposed to individuals), we address a body of different perceptions and values (within the same culture). It is therefore much easier to upset or even offend members, when we apply our own interpretations - as objective as they may be in our view.
Obligations of the culture analyst
Informed consent is not sufficient when working with deeper cultural assumptions. After all, some insiders themselves may not be fully aware of the shared assumptions that form the trunk of their organization. It is thus an obligation of the analyst, to inform of the possible consequences the analysis may have. This implies that the analyst himself understands these consequences and their potentiality to the fullest. Artifacts can be studied by observation, espoused values and beliefs through interviewing and questions and shared assumptions through the previous 2 in combination with deeper analysis into assumptions. Information regarding deeper cultural assumptions or shared assumptions is best obtained through making a group of 10-15 members discuss artifacts, espoused beliefs and deeper assumptions.
Social order forms the basis of culture. Culture in itself is based on groups, which results in its strength and stability. Members will hold on to certain group assumptions as means of maintaining their membership. For instance, if a foreigner came and asked you to change your views on a given issue, you would most likely resist, as you would not want to shake the fundament that binds you to your nationality or country (even, if secretly you agreed with the foreigners assumptions more). In essence, this is a manner to seek acceptance, and very powerful force, at that. Organizations are more complex than groups themselves, yet they originate from small groups. Understanding of this process of formation is crucial for an understanding of cultural evolution.
Group formation: origin, markers and sharing
Every group starts with some kind of event or origin. This could be an accident, a call from leadership or an event which has been advertised. Often organizations employ workshops or cultural islands where individuals are subject to one another on a day to day basis such as training. Trainings are vital to the study of group formations. T groups (training) consist of strangers being brought together with a few staff workers in order to build a climate where all can learn and grow, and so the processes that go on herein, are the most relevant to culture formation. To illustrate the process of group formation consider the following story:
You find yourself in a training group for a company whose function you applied for. There are 17 people in the room, all somewhat tense. The room is silent and no one fully knows what to expect. This shared emotion of ambiguity is dispelled when a staff member walks in and introduces the T group. He mentions that this is an opportunity for everyone to get to know one another’s values and goals in order to create a good working environment. At the same time he mentions that there is no fixed schedule and participation is necessary for progress. After the introduction, following the words “let’s begin”, another awkward silence falls within the group. At this point, you and all your members are aware of the elicitation of this emotion across all members of the group. Subconsciously, this begins the formation of group bonds through shared experience. Eventually, someone will speak up and take initiative. You may feel somewhat relieved that the silence has been broken and the group begins work. Again, this relief, is something all members present there will feel to some extent, once again – extending the shared awareness between these individuals.
In this scenario, we describe how the experience of the same emotion under the same circumstance by several members marks the beginning of group awareness. Referring back to the awkward silence earlier on – if this silence lasts for at least a few seconds – it becomes a marker. A marker is a happening or event which features emotional content sharing. If everyone of the T group we mentioned was asked about memorable moments after the workshop, sure enough most would remember the awkward silence as a “thing that took place and stuck in memory” (marker). Group formation is an implicit and subtle process, but it is able to generate powerful bonds. As a simple example, consider a situation similar to a workshop, perhaps working on a project with a group of class mates. If you have been working together for some time and a member is late, implicitly you would tend to regard him as a form of outsider at first impression. The person may ask then to be filled in on the missed information, and again – some members of your group internally may feel this request to be a nuisance -further distancing the other from the entity of the group, hence reinforcing “groupness”.
Stages of group evolution
Groupness is nothing more than an emotional substrate, which allows to us to get a sense of who is in and who is out. Each stage is described individually. Especially in the beginning phases of group formation (like the training session), members may feel anxious and tense and may not speak out as a result. In this situation the groups dominant assumption is that of dependence on the leadership figure to understand and steer the process. At the same time, aside from work orientated topics, each member is also subjected to his own social orientation. Members of the group also face questions personal questions:
Inclusion (am I in or not?)
Power and influence (can I be myself and express myself here?)
Acceptance and intimacy (do they like me? Can I find friends here?)
Identity and role (who am I, what is my function and how does it relate to others?)
During this stage of evolution, members slowly shift from being dependant on leader for responsibility – accepting some of the responsibility and thus sharing it. In addition personal social orientations are solved.
As groups begin to work together, feelings of solidarity begin to emerge. Members make effort to be polite to one another, avoid conflict and reach harmony. Turquet refers to this strong emotional need to feel merged with the group as fusion – and this forms the dominant group assumption in this stage of group evolution. In this setting, individual differences are valued less, as individuality might stand in the way of unity in this context. The solidarity that forms between members, no longer views the leader as omnipotent, seeing him or her now as no different from the members. To some extent, this is an unrealistic assumption (as the one that the leader is omnipotent), yet at this stage, this trend can oftentimes be observed.
The assumption of fusion will not be surrendered and moved on from until certain marker events occur. Examples of such markers include:
Disagreements and conflicts in attempts to take joint action
Avoidance of confrontation
Overt denial of potential dislike amongst members
Expressing negative feelings to certain members
Consider a member of a group who criticizes another member. The immediate response of the group will form new norms for this type of situation and challenge existing convictions. Someone may say “We shouldn’t attack each other”, and if the group agrees then this becomes a norm by which the group will tend to go on. Leaders and their influence on subordinates, also warrants high influence on norm formation. Eventually, norms develop into assumptions which become taken for granted. The ones that survive time are norms which effectively deal with problem solving (coping with external environment) and anxiety avoidance (coping with internal affairs). The fusion assumption is fully met, when members realize that individual differences do not have to relate to assumptions of the group.
The dominant assumption at this stage of evolution is related to work. Mutual acceptance of each other’s personalities and functionalities is at heart of this stage. There is less pressure to conform, and individuality is appreciated to some degree. Groups at this stage of development have had opportunity for members to get acquainted with each other’s skills and beings, and reconcile this as a balanced stated for achieving performance in work.
Group maturity is the final stage of group evolution. Through trial and error, experimentation, norm building and testing, the group becomes stable in its ways. The norms shared are those who prove most efficient throughout the group’s existence. Continued rehearsal of current assumption yields their stability, and as such members exhibit emotional focus on preserving the group and its culture.
The culture of an organization inevitably begins with the founder and his or her assumption. Through time, learning experiences of group members, as well as new beliefs and values brought on by new members also contribute to the shaping of culture. Nevertheless, the founder’s contribution is still the most significant one. The founder provides initial framework (from which any further development is inherently derived) for the group, by choosing the members and assumptions of the initial group. This group will then carry on these factors in its own development and expansion. These views will maintain until they become dysfunctional.
Example of CEO of Digital Electric Company
The CEO felt that ultimate truth could not be derived from just one individual. This “humble” attitude he shared towards his own capacities were strongly reflected in the management style of DEC. In order to encourage debate and consequent testing of individual ideas, he then set out to create numerous committees and internal boards. In addition, the CEO believed that if ideas do not have full support of the body that implements them, they will ultimately fail. Consent was valued very highly and as a result occasionally important decision meetings would be moved, if a few members were absent – as their contribution was seen as equally necessary for decision making. Communication was emphasized as the CEO believed that even the best plans may not be fully optimal in changing environmental conditions. If for instance, a manger committed to a budget yet after 6 months realized, that he would exceed the budget, he was expected to communicate this to management, renegotiate, or strive to meet the original assumption. In this sense, communication was a solution to otherwise unwanted states of idleness in a given context, or ambiguity regarding what to do.
The CEO’s vision and actions have shaped DEC to foster over 30 years of growth and continuous high morale amongst staff. As the company expanded however, its structure made debate and negotiation of ideas difficult and timely strenuous. This led to the sale of DEC to Compaq in 1990. The example of DEC reflects well on how founder assumptions, values and vision are integrated in shaping the culture of the company. DEC is also an example of how assumption may yield great success and adaptation, but due to changing circumstances, eventually become dysfunctional under new circumstances.
The ability of leaders to set and maintain norms and values is tied in a large degree to individual charisma. However, charisma is a rare trait and granted an individual is charismatic; this gives us little predictability into how this will translate to culture formation. As such, charisma is not in the interest of the study of culture formation, in societal and organizational contexts. Organizations, which are not charismatic, develop many successful means of bringing their message across nonetheless. Embedding mechanisms are conceptualized in terms of primary and secondary. Primary refers to the most prominent daily behavior that leader’s exhibit, the latter to more formal mechanisms which aim to reinforce the primary mechanisms (Articulation, reinforcement).
Primary embedding mechanisms
What the leader devotes attention to (what he measures, what he controls)
As a basic example, if workers are constantly reminded by the leader to sit up straight and take their brakes, and assumption may form that health and ergonomics are a concern the company takes seriously
Leader’s reaction to critical events and crises
At DEC, there was an instance, where a new chief financial officer, brought a data set of overall performance from different production lines. He mentioned 1 line which was failing in its organization. The VP of that line was present, but was silent and embarrassed as he was not familiar with these numbers. To everyone’s surprise the CEO had an emotional eruption, criticizing the VP for his incompetence. Everyone expected the CFO to get disciplined for bringing unfamiliar data, yet the leaders response sent a powerful message, reinforcing his assumption that poor performance could be tolerated, but ambiguity and lack of communication could not.
Leader allocating resources
In DEC, the assumption that good ideas can come from anyone, was reflected by fund allocation. CEO believed in a bottom-up approach, where ideas would come from lower levels (with adequate funding) and get filtered at the top by senior management.
Role modelling, teaching, coaching
Many organizations feature particular staff members as role models. If you had an opportunity to be in a traineeship, odds are that you would have watched a video, with several staff members discussing their norms, values and goals.
Leader allocating rewards/ status
If leaders wish for their assumptions/ values/ beliefs to be learned by members of the group, these assumptions must be represented by adequate rewards. Over time, it becomes clear to the members, which behavior is consistently rewarded and strive to attain it.
Leader recruiting, selecting, promoting/demoting
Recruitment, selection and promotion of personnel by the leader, is a powerful yet subtle embedding mechanism. Leaders tend to recruit individuals who meet their assumptions about what constitutes a good worker in a given company. DEC hired creative, independent people, whilst Ciba-Geigy focused on smart individuals with high degree of education. It is thus conceivable; that the selection process of people takes off from the leader’s assumption and generates individuals close to that profile in the future, thereby embedding the “kind” of people that join. The relative weight of the leaders assumptions in the recruitment scenario could however, only be assessed by an independent outsider.
Secondary embedding mechanisms
Essentially, embedding mechanisms through articulation and reinforcement is expressed through highly visible artifacts. As is tradition with artifacts, analysts should be careful to draw conclusions on deeper assumptions based on pure artifact manifests.
Organizational design and structure
At one extreme, we can imagine a leader who believes his way to be more correct than that of any subordinate. This leader may then choose to structure the organization in a tight hierarchal and centralized fashion. Others play faith in the people and opt for decentralized structures, providing more autonomy to members. DEC’s structure can be said to lie in between these two. While emphasis was on individual contribution (somewhat decentralized), debate was chosen as means of reaching truth – thus reducing the autonomy of the individual.
Organizational systems and procedures
Routines, formalities, forms, evaluations – in short bureaucracy. Though most people complain about it, these processes help to reduce anxiety and ambiguity in the organizational world through routine and stability. Despite their anxiety reducing effects, few, if any, members may recall why all the formalities and bureaucratic procedures were implemented for in the first place. Inconsistencies in systems may cause subculture formation and ultimately conflict. DEC believed each line manager to be responsible for his own financing. If (theoretically) alongside this assumption, the CEO created a centralized financial office, the two groups may be antagonized, due the incongruence.
Rites and rituals
Rites and rituals are very important artifacts to pay attention to, as they are a symbolic manner of formalizing given assumptions. These artifacts, do not so much work in the primary embedding context, but act more as a reinforcing agent. DEC would feature a monthly 2-day meeting where the team would plan long term strategies whilst embarking on a challenging trip such as mountain climbing. The assumption presided that in informal settings, equality is reached and better circumstances for dialogue are formed. Ciba-Geigy would host annual meetings with surprise sports activities. As is the stereotype for scientists, no one was good at the sports, and everyone could fail and laugh at each other (which -in a kind of funny way - also created equality).
Design of space and buildings
The design and location of structures can be a reflection of the key assumptions that circumvent within it. This can only take place however, if the company has developed the means to afford such expression.
Stories of memorable people and events
Stories, much like rituals – can best be approached with caution when interpreting. They may contain content reflecting the assumptions of the leader, but until we know more of the leader we cannot draw inferences on this. Leaders generally cannot influence which stories end up in the organization, but they may turn attention to stories or exploits they deem as worthy (even occasionally contributing own stories)
Formal organizational statements (creed, philosophy)
Open communication by leaders of messages relating to the fundament of the organization, give us a glimpse at some of the assumptions and values of that organization, but only to a limited extent. Statements such as these are usually aimed at a given public and so reveal that part of information which they feel can be released. These statements carry value and have the ability to rally the members and provide a new purpose. Statements like these belong to the middle level of culture – espoused values (ideologies).
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