Organizational Climate and Culture

An Introduction to Theory, Research, and Practice

Mark G. Ehrhart, Benjamin Schneider, William H. Macey

• Publisher: Routledge
• Year: 2013
• ISBN:
  9781317934394
• Edition: 1
• Topic: Business
• Subtopic: Management
• Index: Business

The fields of organizational climate and organizational culture have co-existed for several decades with very little integration between the two. In Organizational Climate and Culture: An Introduction to Theory, Research, and Practice, Mark G. Ehrhart, Benjamin Schneider, and William H. Macey break down the barriers between these fields to encourage a broader understanding of how an organization's environment affects its functioning and performance. Building on in-depth reviews of the development of both the organizational climate and organizational culture literatures, the authors identify the key issues that researchers in each field could learn from the other and provide recommendations for the integration of the two. They also identify how practitioners can utilize the key concepts in the two literatures when conducting organizational cultural inquiries and leading change efforts. The end product is an in-depth discussion of organizational climate and culture unlike anything that has come before that provides unique insights for a broad audience of academics, practitioners, and students.

Chapter 1
Introduction

This book is about the emergence, nature, and assessment of organizational climate and culture and the ways in which the two may be integrated to yield improved understanding about organizations and their effectiveness. The genesis of the book lies in our writing chapters for the APA Handbook of Industrial and Organizational Psychology (Schneider, Ehrhart, & Macey, 2011b) and the second edition of the Handbook of Organizational Culture and Climate (Schneider, Ehrhart, & Macey, 2011a), as well as our articles in the Society for Industrial and Organizational Psychology’s (SIOP) journal, Industrial and Organizational Psychology: Perspectives on Science and Practice (Schneider, Ehrhart, & Macey, 2012), and the Annual Review of Psychology (Schneider, Ehrhart, & Macey, 2013). We realized that we had a tremendous amount of excellent and interesting material to work with for these chapters and that our reflections on what we had written revealed that we had still more ideas that might prove useful for those interested in the topics. Therefore, this book presents a summary of what we learned in those chapters with expanded reviews of relevant research literatures, potential for their integration, and expanded implications for practice.

In this opening chapter, we introduce the reader to what organizational climate and culture are, the assumptions and goals we had as we wrote the book, some clarifications of what we intentionally were not trying to accomplish, and a brief overview of the chapters to follow.

Definitions of Organizational Climate and Culture

Our experience in teaching about organizational climate and culture and in trying to inform management in organizations about the importance of these ideas tells us that everyone has their own ideas about what they mean when they say climate and/or culture. People use many different ways to characterize these two constructs. For example, as we will see in the discussions of the history of these constructs, various terms have been used to try to capture the overall or global or macro look and feel of organizations to their members. In addition to climate and culture, terms such as organizational atmosphere and organizational character have also been used.

For now we define organizational climate as the shared meaning organizational members attach to the events, policies, practices, and procedures they experience and the behaviors they see being rewarded, supported, and expected (we discuss this definition in more depth in Chapter Three). Organizational climate is an abstraction that represents the cognitive structuring of a whole out of many observations and experiences; the whole is the meaning attached to those many observations and experiences. Thus, climate is conceptually an abstraction about the meaning of a setting for the members that experience it. There has been debate about whether climate exists primarily as an individual experience or as a characteristic of the group or organization, especially because our measurement of climate typically involves collecting individual reports of climate and then aggregating them to the organizational level of interest (e.g., group, department, or organization). That debate and how it has been resolved will be one of the central foci of the chapters on organizational climate. Climate research has attempted to capture the abstractions members experience about their unit and relate those abstractions to effectiveness indices that are important to those units. Climate has been outcome-focused and in that sense, research on it has largely been based on a predictive model—one attempts to assess climate because it helps understand important effectiveness outcomes that are conceptually seen to emerge from the climate.

Organizational culture is defined as “a pattern of shared basic assumptions learned by [an organization] as it solved its problems of external adaptation and internal integration, which has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems” (Schein, 2010, p. 18). The idea that beliefs, ideologies, and values are shared has been assumed in the organizational culture research paradigm, with culture always referring to something that exists beyond the individual member and that is transmitted through stories and rituals as well as the experiences newcomers have. Much of the theory underlying culture would suggest that the members of the collective characterized by it are not necessarily aware of the culture in which they reside but that it exists in their behaviors and the assumptions they make about what is important. Culture research has historically been descriptively focused: what is culture, what are its components, and how do people come to learn the culture of their unit. It is only in more recent guises that culture research has been focused on effectiveness outcomes, and this transition from a more descriptive to a more predictive approach to culture will be one of the central foci of the chapters on organizational culture. Thus, while management consultants and news media observers of organizations have discussed the nature of culture and its importance for effectiveness, it is more recently that researchers have also had this focus on effectiveness.

The focus on the meaning and cognitive structuring of actual experiences in climate research suggests the psychological traditions, especially Gestalt psychology, from which organizational climate emerged. In contrast, the focus on values and beliefs and the methods by which they are transmitted (myths and stories) indicates the locus of organizational culture in anthropology and sociology. Readers will find it interesting in the discussions of history that come later to see how these ideas emerged and became relevant for the modern study of organizations and how we think they together yield powerful insights for not only understanding organizations, but also for helping them become more effective.

So many issues to review to understand these complex ideas, but so little time! As we noted earlier, our collective sense after the writing of the two review chapters (Schneider et al., 2011a, 2011b) was that there was a need for a more in-depth discussion of what each of the organizational climate and culture literatures brings to the table and how the two can build on each other and be integrated in both research and practice. This book is our attempt to provide an expanded historical and practical—and integrated—treatment of these complex but understandable, interesting, and important concepts.

Assumptions

The three of us have a background in industrial/organizational (I/O) psychology, and that background has greatly influenced our approach to this book and general thinking on these topics. One of the hallmarks of I/O psychology is its emphasis on the scientist-practitioner model. This model integrates science with practice and vice versa, suggesting the rigor that should underlie practice and the need to focus research efforts on practical problems in the work place. Thus, we deeply value the need for a rigorous, scientific approach to the study of climate and culture and we believe it important for the study of both to focus on improving organizational effectiveness vis–à–vis the employees who work in them. In short, our position is that research has little value unless it is put into practice and influences how organizations actually function. We believe that the topics of climate and culture are (or should be) highly valuable to practitioners because they deal with how people sense what is valued and important in their work place, and as the sense they make of their workplace is based on what employees actually observe and experience, this information can be useful for making improvements.

Another of our assumptions is the value we place on research excellence whether of the quantitative or qualitative variety. Early research on both climate and culture was characterized by a more qualitative orientation and that approach yielded numerous insights. Culture research persisted longer with a focus on qualitative approaches as befits its background in anthropology, while climate became increasingly quantitative in its approach to measurement. The point is not which is better but the purpose for which the research has been accomplished and its usefulness. Indeed one of us has written for many years about the need for both types of methods in both climate and culture research (e.g., Schneider, 2000). On a distinct but oftentimes related note, we emphasize and value both etic approaches (comparisons across organizations), particularly for applied research efforts, and emic approaches (studying an organization individually and in-depth), particularly for practical purposes when a specific company has sought our services. So, it is one thing to know the correlates of a climate for service across many organizations (etic approach) and it is another thing to work in a specific organization to make improvements in its climate for service (emic approach).

A final assumption is that organizational effectiveness is an expansive concept and needs to be defined broadly and not solely in terms of financial performance. Particularly, it need not be defined only in the ways that management dictates. Effectiveness is multifaceted, and it is important to think about it from the perspective of the multiple stakeholders of the organization. Our preference is not to limit our discussion by focusing on either/or thinking—for example, this stakeholder (e.g., stockholders) receives an outcome OR this one (e.g., employees) does, but not both. Rather, we favor climates and cultures that work in favor of multiple stakeholders because those solutions tend to provide the most benefit to the organization in the long run. The research we will later summarize supports this more expansive perspective.

Our Goals: What We Hope to Accomplish

1. To stimulate thinking and research on organizational climate. Research on organizational climate has grown substantially since the turn of the century (Kuenzi & Schminke, 2009); our goal is to help move the study of climate forward, especially via insights learned from the study of organizational culture.
2. To stimulate thinking and research on organizational culture. Some organizational culture researchers have observed that the field has perhaps lost some of its earlier momentum (Alvesson, 2011), at least in that organizational culture is more rarely the primary focus of academic researchers (Martin, Frost, & O’Neill, 2006). Our review of publications in top I/O psychology and management journals suggests that empirical research specifically focused on organizational culture in the past decade or so has been more limited than it had been in the previous two decades, particularly relative to empirical research on climate (Schneider, Ehrhart, & Macey, 2013). We think this state of affairs is neither useful nor necessary.¹ So we will address how research on organizational culture can (a) benefit from the work on organizational climate, and (b) help with many issues practitioners face, particularly in the area of organizational change and, reciprocally, how the practical implications of organizational culture can renew interest in the topic among organizational researchers.
3. To put a variety of information on climate/culture in one place and organize it in a holistic way. Although several handbooks of organizational climate and culture have appeared in the literature over the past 20 years, those that we know of are edited books with some authors focusing on climate and others on culture, with little integration between the two. By authoring a book that focuses simultaneously on both topics, we hope to be a force for more integrative thinking and communication across the two fields.

What We are Not Trying to Accomplish

1. To present ourselves as unbiased. We do not pretend to be unbiased in our evaluations and conclusions of the organizational climate and culture literatures. Thus, this book offers our collective perspectives on the two topics, including our viewpoint on what the topics offer individually and collectively to both understanding and practice. We focus on what we see are the key themes and “big picture” issues in the two literatures, and we review them with sample studies. We recognize that others may have highlighted different issues or come to different conclusions, and thus we are up front that this book represents our own collective perspective.
2. To provide an exhaustive literature review. Our goal in writing this book was never to provide an exhaustive review of the literatures on organizational climate and culture. In our overviews of the history of these constructs (particularly climate), we have tried to highlight the articles that in our view have had the largest impact on the field, supplemented with some that have less impact but help to paint a picture of the general thinking of the time. In addressing contemporary issues related to both climate and culture, we selected articles that best highlight the general themes we identified in the literature. We have certainly had to leave out many interesting and well-done articles and chapters, but hopefully our summaries provide a good starting point for readers wishing to do a more in-depth review of particular topics.
3. To discuss all practices that influence or are influenced by climate and culture. As outcomes of the thousands of things that happen in organizations, climate and culture can be addressed from the perspective of all formal and informal practices that yield them. We do not do this here. The fields that serve as the primary foundations for the contemporary study of climate and culture, specifically industrial/organizational psychology and organizational behavior, are the sources for those details. Thus, while leadership and teams and pay practices and job attributes all likely contribute to and are influenced by the climate and culture of organizations, the details of basic research on each of these is not within the purview of this book; we focus on their relationship to climate and culture.

Organization of the Book

The chapters of the book can be grouped into three general sections, each with two chapters. Chapters Two and Three focus on organizational climate, Chapters Four and Five discuss organizational culture, and the Chapters Six and Seven address the integration of the two. The final chapter, Chapter Eight, summarizes our major points from throughout the book and highlights practical implications for organizations and recommended areas for future research on organizational climate and culture.

Of the two chapters on organizational climate, the first covers the history of organizational climate research. Although aspects of this history have been summarized by us (e.g., Schneider et al., 2011b; Schneider, Bowen, Ehrhart, & Holcombe, 2000; Reichers and Scheider, 1990) and others (e.g., Ashkanasy, Wilderom, & Peterson, 2000a), the history of climate research has not been described in the level of detail we provide here. We cover the history of climate in such depth because of its importance in setting the stage for later climate research. In fact, many of the major differences in the ways climate has been conceptualized and studied can be traced to diverging perspectives in those early years. In Chapter Two, we divide the foundational work on climate into two major periods. The first period covers the years before the formal, quantitative study of climate began in earnest, when the seeds of the construct were being planted by researchers in various outlets who shared an interest in the study of the unique environments that are created by and for people in work organizations. The second period began in the late 1960s and continued through the 1970s. This era witnessed the beginning of formal studies of climate coupled with various reviews and critiques of the construct, its conceptualization, and its measurement. Of particular importance during this early work was the design of survey measures for the assessment of organizational climate, whether climate was a generic construct or whether it should be studied with some focus, and distinctions among job satisfaction, organizational climate, and psychological climate.

The time frame from the 1980s to the present comprises what we consider to be the contemporary study of organizational climate, which is the focus of Chapter Three. This period has been characterized by the resolution of many of the early controversies, as evidenced by significant progress in the areas of levels of analysis and the study of climates focused on specific outcomes (like safety and service). As part of Chapter Three, we address how climate is currently defined and studied and its expansion into significant organizational process foci of theory and research in organizations (e.g., fairness, ethics). We describe how climate research has moved beyond just focusing on mean levels of climate perceptions to taking into account variability in those perceptions (i.e., climate strength), and how research on climate has taken numerous vantage points, including antecedents, outcomes, boundary conditions of those outcomes, processes that mediate the resulting effects, climate itself as a moderator, and so on. In sum, Chapter Three covers both the current state of the art in the field and also suggests in some detail areas of thinking and research where progress still needs to be made.

In the second section of the book, Chapters Four and Five, we focus on organizational culture and organize the two chapters similarly to the two chapters on climate. Chapter Four concerns foundational ideas in the literature on organizational culture, although we do not develop our discussion of the history of culture to the extent that we do the history of organizational climate in Chapter Two. Somewhat paradoxically, there are extensive books on organizational culture history, research, and theory (e.g., Alvesson, 1993; Deal & Kennedy, 1982; Denison, 1990; Hofstede, 1991; Martin, 1992, 2002; Schein, 1985, 2010; Trice & Beyer, 1993), more so than exist on organizational climate (zero such books!) even though there is a larger empirical research literature on climate. Therefore, we highlight what we see as the key developments in the history of organizational culture, with a particular emphasis on the way the roots of culture research are intertwined with those of climate research. In fact, as we note, the rise in studies of culture was at least in part a reaction to the state of the field of organizational climate and the disagreements that dominated the field over what some considered to be “technical minutiae” (Ashkanasy, Wilderom, & Peterson, 2000b). After our brief historical treatment of culture, we address three foundations of the culture literature: how it has been conceptualized, how it has been defined, and how it has been studied.

Chapter Five transitions to some of the issues we view as critical for understanding where culture comes from and its effect on organizations. We begin with a summary of some of the key influences on the development of organizational culture that have been identified in the literature, including the organizational founder, the collective learning by organizational members as a result of the organization’s successes and failures, and the organization’s context including its industry and the national culture of its home country. Closely related ...