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Organizational Environment, Culture, and Climate

Every organization has a particular work environment that dictates to a considerable degree how its leaders respond to problems and opportunities. This is normally brought about by its heritage of past leaders and its present leaders.

Goals, Values, and Concepts

Leaders exert influence on the environment via three types of actions:

The goals and performance standards they establish
The values they establish for the organization
The business and people concepts they establish

Successful organizations have leaders who set high standards and goals across the entire spectrum, such as strategies, market leadership, plans, meetings and presentations, productivity, quality, and reliability.

Values reflect the concern the organization has for its employees, customers, investors, vendors, and surrounding community. These values define the manner in how business will be conducted.

Concepts define what products or services the organization will offer and the methods and processes for conducting business.

These goals, values, and concepts make up the organization's personality or how the organization is observed by both outsiders and insiders. This personality defines the roles, relationships, rewards, and rites that take place.

Roles and Relationships

Roles are the positions that are defined by a set of expectations about behavior of any job incumbent. Each role has a set of tasks and responsibilities that may or may not be spelled out. Roles have a powerful effect on behavior for several reasons, to include money being paid for the performance of the role, there is prestige attached to a role, and a sense of accomplishment or challenge.

Relationships are determined by a role's tasks. While some tasks are performed alone, most are carried out in relationship with others. The tasks will determine who the role-holder is required to interact with, how often, and towards what end. Normally the greater the interaction, the greater the liking. This in turn leads to more frequent interactions. In human behavior as it is hard to like someone whom we have no contact with, and we tend to seek out those we like.

People tend to do what they are rewarded for, and friendship is a powerful reward. Many tasks and behaviors that are associated with a role are brought about by these relationships. That is, new tasks and behaviors are expected of the present role-holder because a strong relationship was developed in the past, by either that role-holder or by a prior role-holder.

Culture and Climate

Culture and climate are two distinct forces that dictate the norms for how a person should act within an organization.

Each organization has its own distinctive culture. It is a combination of the founders, past leadership, current leadership, crises, events, history, and size (Newstrom, Davis, 1993). This results in rites: the routines, rituals, and the “way we do things.” These rites impact individual behavior on what it takes to be in good standing (the norm) and directs the appropriate behavior for each circumstance.

The climate is the feel of the organization, the individual and shared perceptions and attitudes of the organization's members (Ivancevich, Konopaske, Matteson, 2007).

On the other hand, culture is the deeply rooted nature of the organization that is a result of long-held formal and informal systems, rules, traditions, and customs. This differs from climate, which is a short-term phenomenon created by the current leadership and its members. Climate represents the beliefs about the “feel of the organization” by its members. This individual perception of the “feel of the organization” comes from what the people believe about the activities that occur in the organization. These activities influence both individual and team motivation and satisfaction, such as:

How well does the leader clarify the priorities and goals of the organization?
What is expected of us?
What is the system of recognition, rewards, and punishments in the organization?
How competent are the leaders?
Are leaders free to make decisions?
What will happen if I make a mistake?

Organizational climate is directly related to the leadership and management style of the leader, based on the values, attributes, skills, and actions, as well as the priorities of the leader. Compare this to “ethical climate” — the feel of the organization about the activities that have ethical content or those aspects of the work environment that constitute ethical behavior. The ethical climate is the feel about whether we do things right. The behavior (character) of the leader is the most important factor that influences the climate.

On the other hand, culture is a long-term, complex phenomenon. Culture represents the shared expectations and self-image of the organization. The mature values that create tradition or the “way we do things here.” Things are done differently in every organization. The collective vision and common folklore that define the institution are a reflection of culture. Individual leaders cannot easily create or change culture because culture is a part of the organization. Culture influences the characteristics of the climate by its effect on the actions and thought processes of the leader. But, everything you do as a leader will affect the climate of the organization.

For information on culture, see Long-Term Short-Term Orientation

Next Steps

Go to the next chapter: Leading

Return to the main Leadership Site

Perform a Leadership Learning Activity:

Leadership Self-Assessment Survey (short version)
Leadership Self-Assessment Survey (long version)
Culture and Climate activity

References

Bass, B. (1990). From transactional to transformational leadership: learning to share the vision. Organizational Dynamics, 18, (3), Winter, 1990, 19-31.

Ivancevich, J., Konopaske, R., Matteson, M. (2007). Organizational Behavior and Management. New York: McGraw-Hill/Irwin.

Jago, A.G. (1982). Leadership: Perspectives in theory and research. Management Science, 28(3), 315-336.

Kotter, J.P. (1990). A Force for Change: How Leadership Differs From Management. New York: Free Press.

Kouzes, J.M., Posner, B.Z. (1987). The Leadership Challenge. San Francisco: Jossey-Bass.

Kruse, K. (2013). What Is Leadership? Forbes Magazine.

Lamb, L.F., McKee, K.B. (2004). Applied Public Relations: Cases in Stakeholder Management. Mahwah, New Jersey: Lawrence Erlbaum Associates. Routledge.

Mischel, W. 1968. Personality and Assessment. New York: Wiley.

Newstrom, J., Davis, K. (1993). Organization Behavior: Human Behavior at Work. New York: McGraw-Hill.

Northouse, G. (2007). Leadership Theory and Practice. (3rd ed.) Thousand Oaks, CA: Sage Publications.

Rowe, W.G. (2007). Cases in Leadership. Thousand Oaks, CA: Sage Publications.

Stogdill, R.M.(1989). Stogdill's Handbook of Leadership: A Survey of Theory and Research. Bass, B. (ed.) New York: Free Press.

U.S. Army. (1983). Military Leadership. Field Manual 22-100. Washington, DC: U.S. Government Printing Office.