The Significance of Organizational Culture

In this article I will look at organizational culture and its impact on KM processes. The other article in this section examines leadership and the learning organization, as outlined by Peter Senge.

What is Organizational Culture?

The social elements of knowledge that have been underlined in previous sections are at least partially dependent on organizational and community culture. Organizational culture determines values and beliefs which are an integral part of what one chooses to see and absorb (Davenport & Prusak 2000). It includes a shared perception of reality, regarding how things are and how things should be. Furthermore, community and group culture determine the willingness and conditions for knowledge sharing with other members of the organization. Knowledge, and knowledge sharing, are thus inseparable from organisational culture.

Wellman (2009) essentially describes culture as "the way it is around here." To illustrate the perseverance of organizational culture he presents an interesting allegory which I will summarize below:

Put five apes in a cage. Then dangle a banana from the ceiling of that cage and place a ladder under it. Whenever an ape attempts to climb the ladder to reach the banana, spray all of them with cold water. After a few times, the apes will associate climbing the ladder with being sprayed with cold water. One can now turn off the cold water.

Then, replace one of the original apes with a new one. This new ape will undoubtedly try to get to the banana, but if he tries he will be attacked by the others. He will have no idea why this is so, but will soon learn that he must not climb the ladder. Next replace yet another ape. When he approaches the ladder all the apes will attack him. One of these apes has no idea why he may not climb the ladder, but he participates in the punishment enthusiastically. Soon the new ape will also learn not to climb the ladder.

In this way, one can continue until all the original apes are replaced. At this stage, none of them know why they must not climb the ladder, but none will do so, and all will attack anyone that tries. All of this because "that's the way it has always been around here."

Strange as it may seem, this kind of cultural learning can be identified time and again in real world organizations. Wellman points out that at times this can be beneficial and detrimental. Hard wiring a reaction can push the organization into action quickly against a perceived threat. The problem is that this "instinctive response may be inappropriate for the current environment but may be triggered nonetheless" (Wellman 2009).

All in all, organizational culture can be split into levels (Schein 1992):

  • Artifacts: These represent the visible elements such as processes, structures, goals, climate, dress codes, furniture, etc. An outsider can see them but may not understand why things are the way things are.
  • Espoused values: The values espoused by the leaders. They most often are grounded in shared assumptions (see below) of how the company should be run. If there is a significant mismatch between the leadership espoused values and this perception, the organization may be in trouble.
  • Assumptions: These are the actual values of the culture. They refer to the (often tacit) views of the world itself (e.g. human nature). Again, these assumptions should need to correlate at least to a certain degree to the espoused leadership values for the organization to function smoothly.

Organizational Culture and Knowledge Sharing

The importance of a knowledge sharing culture as an enabler for the transfer and creation of knowledge is directly addressed by such authors as Bukowitz & Williams (1999), Davenport and Prusak (2000), and Gamble and Blackwell (2001). In order to make knowledge management initiatives work in practice, the employees within the firm must be willing to share their knowledge with others. Leaders must understand the culture both on an organisational and community level. While culture often exists on an organizational level, each community may have its own norms, perspectives, and collective understandings. Their willingness to share and to seek knowledge will be influenced by these collective views.

One major influence to a culture's knowledge sharing willingness is the issue of reciprocity (Davenport & Prusak 2000). This refers to the individual's need to perceive a current or future return on the knowledge he chooses to share. This could be in the form of direct compensation of some kind; it could be something intangible like enhancing the individual's reputation; but it can also be the knowledge that the favor will be returned the next time he requires assistance.

Finally, internal competition is yet another aspect of organizational culture that may interfere with the knowledge sharing and knowledge creation process.


The Problems with Managing Organizational Culture

The problems with managing culture can be summed up as follows:

  • Culture reaffirms itself by rejecting misfits and promoting those that adhere to the norms of the organization (Gamble & Blackwell 2001).
  • Culture often consists of learned responses that are hard wired into the organization. The actual events that sparked this "lesson" may be long forgotten (Wellman 2009). This is very similar to the concept of organizational learning according to Levitt and March (1996) which indicates that organizations are far more likely to remember interpretations of events rather than the event itself.
  • Culture contains falsehoods. Past lessons are applied often without understanding them and their reasons for being.

For more on how to manage organizational culture, please see the subsection on organizational culture change.


Alan Frost M.Sc., 2010

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