The document discusses organizational culture and introduces the Organizational Culture Assessment Instrument (OCAI) to diagnose culture. The OCAI is based on the Competing Values Framework which includes four main culture types: clan, adhocracy, market, and hierarchy. It involves assessing six key aspects of culture to determine an organization's current and preferred cultures. Understanding differences can provide insights for initiatives to improve performance by better aligning culture and goals.

1. [BUHRM 3701- MANAGEMENT OF CHANGE AND
ORGANIZATIONAL DEVELOPMENT]
January 8, 2014
ABSTRACT
Organizational culture is a key source of competitive advantage. There is a
demonstrated relation between organizational culture and organizational performance. This
paper reviews research in the field and introduce a model for understanding, diagnosing and
changing organizational culture. The main advantage of a new model is based on regarding
culture as the management and work practices that are either hindering or helping an
organization’s bottom line performance.
Diagnosing Organizational Culture
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2. [BUHRM 3701- MANAGEMENT OF CHANGE AND
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January 8, 2014
Table of Contents
ABSTRACT............................................................................................................................................ 1
1.0 INTRODUCTION ............................................................................................................................ 3
2.0
Organizational Culture ............................................................................................................. 4
2.1 The Comparative Measurement of Organizational Cultures ............................................... 4
3.0
The Organizational Culture Assessment Instrument or OCAI ........................................... 5
3.1
The Clan Culture ................................................................................................................... 6
3.2
The Adhrocracy Culture ....................................................................................................... 6
3.3
The Market Culture ............................................................................................................... 6
3.4
The Hierarchy Culture .......................................................................................................... 7
CONCLUSION ...................................................................................................................................... 8
REFERENCES ...................................................................................................................................... 9
Diagnosing Organizational Culture
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1.0 INTRODUCTION
Organizational culture is a key source of competitive advantage. Understanding,
diagnosing and conducting interventions to change organizational culture will impact the
overall performance. This paper reviews research in the field and introduce an organizational
culture model to obtain insights and initiate interventions to increase performance.
The paper begins by discussing the concept of organizational culture and the impact on
organizational performance. Most organizational scholars and observers now recognize that
organizational culture has a powerful effect on the performance and long-term effectiveness
of organizations (Cameron and Ettington, 1998). This paper also briefly addresses the
meaning of the term organizational culture. To understand how culture change can enhance
organizational performance, it is important that we make clear what is and is not culture. All
this establishes a groundwork for introducing framework of the core dimensions of
organizational culture. Along with the framework, it introduce an instrument and a method for
diagnosing and initiating cultural change. And also provide some examples of companies
that have successfully implemented the methodology.
Organizational Culture Assessment Instrument (OCAI) is used to diagnose
organization’s culture. Although there are a variety of ways to assess organizational culture,
this instrument has been found to be both useful and accurate in diagnosing important
aspects of an organization’s underlying culture and it has been found to predict
organizational performance. The model of the Competing Values Framework which consists
of four Competing Values that correspond with four types of organizational culture.
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4. [BUHRM 3701- MANAGEMENT OF CHANGE AND
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2.0 Organizational Culture
There is considerable agreement as to the general definition of organizational culture
and most cultural models and diagnosis tools define culture as a system of shared values
and beliefs that produce norms of behavior and establish an organizational way of life
(Koberg & Chusmir, 1987, p.397). According to Schein’s (1981, 1985, 1992) theory,
organizational culture is defined as a pattern of shared basic assumptions that the group
learned as it solved its problems of external adaptation and internal integration, that has
worked well enough to be considered valid and, therefore, to be taught to new members as a
correct way to perceive, think and feel in relation to those problems.
Schein considers culture to be a three layer phenomenon, they are artifacts and
behaviors, espoused values, and assumptions. Artifacts are the most superficial
manifestations of culture, and basic assumptions, the deepest layer of culture have been
typically studied using qualitative approaches. Values and behavioral patterns have been
measured using quantitative instruments. Organizational values refer to the principles which
underlie patterns of behaviors and norms. Patterns of behaviors and norms have been
defined as the way of thinking, behaving, and believing that members of a social unit have in
common (Cooke and Rousseau, 1988). Compared to values, behavioral norms would be
easier to learn and they could be readily influenced by the organization, through the
management practices. Hofstede (1990)’s data shows that the different organizations within
the same national culture could be distinguished from the behavioral norms (day-to-day
practices) they differently adopt and not from their values. Because of their sensitivity to
change and to inter-organizations variations, behavioral norms questionnaires produce
information particularly useful for the purpose of intervention.
2.1 The Comparative Measurement of Organizational Cultures
Organizational culture researchers have long debated whether cultures can be
compared and measured. Some researchers have concluded that the deeper levels of
culture such as symbolic meaning, semiotics, and underlying beliefs and assumptions are no
subject to comparative analysis and are best understood through clinical or ethnographic
methods (Schein, 1992; Van Maanen, 1988). Whereas other culture researchers, while
acknowledging the limitations of comparative research for understanding the deeper levels of
culture, have persisted in the development of systematic approaches to comparative
measurement.
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Another approach is based on the Competing Values Framework for cultural
assessment distilled by Quinn and Rorbaugh (1983) from analysis of Campbell’s longer list
into a four dimensional pattern such as clan, adhocracy, hierarchy and market.
3.0 The Organizational Culture Assessment Instrument or OCAI
The Organizational Culture Assessment Instrument (OCAI) is a tool for diagnosing
organizational culture, developed by Professors Robert Quinn and Kim Cameron. OCAI is a
validated instrument, based on the Competing Values Framework, and used by thousands of
companies worldwide (www.ocai-online.com). . OCAI offers quick, identifiable diagnosis with
a visual profile. The model of the Competing Values Framework which consists of four
Competing Values that correspond with four types of organizational culture. Every
organization has its own combination of these four types of organizational cultures (clan,
adhocracy, hierarchy and market). Test takers assess six key characteristics of their
corporate culture, they are dominant characteristics, organizational leadership, management
of employees, organization glue, strategic emphasis and criteria of success (Cameron and
Quinn, 1999).
Flexibility & discretion
Clan
Adhocracy
Internal Focus
& Integration
External Focus &
Diferentiation
Hierarchy
Market
Stability & control
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3.1
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The Clan Culture
This working environment is a very pleasant place to work, where people share a lot
of personal information, much like an extended family (www.ocai-online.com). The leaders or
heads of the organization are seen as mentors and perhaps even parent figures. The
organization is held together by loyalty or tradition. The organization emphasizes the longterm benefit of human resources development and attaches great importance to cohesion
and morale. Success is defined in terms of sensitivity to customers and concern for people.
The organization places a premium on teamwork, participation, and consensus. The example
of a clan-type organization in the United States was People Express Airlines in its first five
years of operation until its founder, Don Burr, encountered financial difficulties that led him to
sell the company to avoid bankruptcy. Burr brought with him several other officials from
Texas Air and within two years has defied all experts’ predictions by turning a profit. It is the
most dramatic study of the history of the airline industry.
3.2
The Adhrocracy Culture
A dynamic, entrepreneurial, and creative place to work. People stick out their necks
and take risks. The leaders are considered innovators and risk takers. The glue that holds
the organization together is commitment to experimentation and innovation (Cameron, K. &
Quin, R., 1999). The emphasis is on being on the leading edge. The organization’s long
term emphasis is on growth and acquiring new resources. Success means gaining unique
and new products or services. Being a product or service leader is important and the
organization encourages individual initiative and freedom (http://ocai.wordpress.com).
Sometimes adhocracy subunit culture existing within a hierarchy was described in the study
that occurred in the Department of Mental Hygiene in the state government of New York
(Quinn and Cameron, 1983). In its first five years of existence, the department was organized
as an adhocracy.
3.3
The Market Culture
A result-oriented organization whose major concern is getting the job done. People
are competitive and goal-oriented. The leaders are hard drivers, producers, and competitors.
They are tough and demanding. The glue that holds the organization together is an
emphasis on winning. Reputation and success are common concerns. The long-term focus is
on competitive actions and the achievement of measurable goals and targets. Success is
defined in terms of market share and penetration. Competitive pricing and market leadership
are important. The organizational style is hard-driving competitiveness. The General Electric
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culture under Jack Welch was known as a highly competitive, results, take no prisoners type
of culture. It reflected a stereotypical market culture (Quinn and Cameron, 1983).
3.4
The Hierarchy Culture
A very formalized and structured place to work. Procedures govern what people do.
The leaders pride themselves on being good coordinators and organizers who are efficiencyminded. Maintaining a smooth-running organization is most critical. Formal rules and policies
hold the organization together. The long-term concern is stability and performance with
efficient and smooth operations. Success is defined in terms of dependable delivery, smooth
scheduling and low cost. The management of employee is concerned with secure
employment and predictability. Organizations ranging from a typical U.S. fast-food restaurant
such as McDonald’s to major conglomerates like Ford Motor Company and government
agencies such as Justice Department provide prototypical examples of a hierarchical culture
(Quinn and Cameron, 1983).
A quantitative starting point completed with qualitative information, consensus about
current and preferred culture, the momentum for change, and basic for the successful and
sustainable change. The OCAI way: 21st Century Change, engaging and inclusive. The
problem with organizational culture change is about 70% fails because it does not fit into the
current culture and it is ordered in a command and control way and causes resistance. The
things is we cannot change others. We have to change collectively to make a real,
sustainable change as an organization.
There are some reasons why use the OCAI for diagnosing culture in organizations. First, it
gives a validated and quantified image of overall culture as a starting point for change.
Second, it is timely and focused. It measured six key aspects that make a difference for
success, and both assessment and change strategy can be done quickly. Third, it is involved
as it is easy to include all the personnel and gives an idea of employee satisfaction, based on
discrepancies between current and preferred culture. Fourth, it is manageable with a step-bystep method for change and it supplies a clear vision on the preferred culture that can be
adapted to become a road map for change, that will mobilize the organization to sustainable
change (www.ocai-online.com).
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8. [BUHRM 3701- MANAGEMENT OF CHANGE AND
ORGANIZATIONAL DEVELOPMENT]
January 8, 2014
CONCLUSION
Research shows a powerful effect on the performance and long-term effectiveness of
organizations. Culture comprises the collective assumptions and it determines behavior,
performance and turnover, customer satisfaction and reputation, market share and
competitiveness. The Organization Culture Assessment Instrument (OCAI) is an instrurment
that allows us to diagnose the dominant orientation of the organization based on these core
culture types. Two major polarities of values were found to determine organization’s
effectiveness. By rating six key aspects of organizational culture that were found to
determine success, the respondent assesses the current and preferred organizational
culture. The outcome is based on Competing Values Framework and consists of four culture
types that are clan culture, adhocracy culture, market culture and hierarchy culture. And
because the world is changing rapidly, most organizations have to adapt to survive and
succeed. Sustainable change is possible when executives and employees change their
working culture and behavior and thus their results.
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REFERENCES
Cameron, K. S., Quinn, R. E. 1999. Diagnosing and changing organizational culture: Based
on the competing values framework. Reading, MA: Addison-Wesley.
Cooke, R. A., Lafferty, J. C. 1989. Organizational Culture Inventory, Plymouth: Human
Synergistics.
Hofstede, G., Neuijen, B., Ohayv, D. D., Sanders, G. 1990. Measuring organizational
cultures: A qualitative and quantitative study across twenty cases. Administrative
Science Quarterly, 35, 286-316.
Koberg, C. S., & Chusmir, L. H. 1987. Organizational culture relationships with creativity and
other job-related variables. Journal of Business Research, 15, 397-409.
Quinn, R. E., Rohrbaugh, J. 1983. A spatial model of effectiveness criteria: Towards a
competing values approach to organizational analysis. Management Science, 29,
363-377.
Quinn, Robert E., and Cameron, Kim S. “Organizational Life Cycles and Shifting
Criteria of Effectiveness.” Management Science, 1983, 29, 33–51.
Schein, E. 1992. Organizational culture and leadership. San Fransisco, CA: Jossey-Bass.
From Internet:
Bremer, M. 2010. Organizational Culture Assessment Instrument (OCAI) explained.
Retrieved January 7, 2014, from, http://www.ocai-online.com/about-theOrganizational-Culture-Assessment-Instrument-OCAI
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