Cultural Change in Organizations
• Lesson 7 – Change Management
• Date: 13-March-2025
Introduction to Cultural Change
Definition:
❑ According to Edgar Schein (1990), organizational culture
is the pattern of basic assumptions that a given group
has invented, discovered, or developed in learning to
cope with its problems of external adaptation and
internal integration, and that have worked well enough
to be considered valid and, therefore, to be taught to
new members as the correct way to perceive, think, and
feel about those problems.
❑ Culture is important for the organization because of its
impact on performance.
Why Cultural Change is Necessary?
• Business expansion and globalization.
• Technological advancements.
• Mergers and acquisitions.
• Internal inefficiencies and resistance to
innovation.
• Employee engagement and retention.
Six Mechanisms of Cultural Evolution
1. Organic Evolution – Gradual, natural adaptation over
time.
2. Micro-Evolution – Small, incremental changes in teams
or departments.
3. Vision-Driven Evolution – Cultural shifts led by
leadership vision.
4. Cross-Pollination (tác động chéo) – Adoption of
cultural elements from external sources.
5. Structured Transformation – Intentional, planned
cultural change initiatives.
6. Cultural Disruption – Rapid change due to crises or
external pressures.
Guidelines for Achieving
Cultural Change
1. Align Culture with Vision & Mission – Reinforce organizational
objectives through culture.
2. Create Urgency – Highlight the need for change and continuous
reinforcement.
3. Stakeholder Engagement – Involve employees and leadership for
successful adoption.
4. Model the Change – Leaders should exemplify the desired
cultural behaviors.
5. Enable Supporting Mechanisms – Implement incentives, policies,
and training.
6. Collective Ownership – Change should be integrated at all levels,
not just HR-driven.
Case Study
Rebranding in Financial Services
• Scenario: A financial services company aimed to shift
towards a customer-centric culture.
Key Actions Taken:
• Customer segmentation to tailor service strategies.
• Employee role redefinition to align with brand goals.
• Feedback loops implemented for iterative
improvements.
• Leadership involvement to model the cultural shift.
• Outcome: Increased customer satisfaction and
employee engagement.
Overcoming Resistance
to Cultural Change
Common Barriers:
- Fear of the unknown.
- Loss of power and influence.
- Lack of trust in leadership.
Strategies:
- Transparent communication.
- Active participation and empowerment.
- Continuous learning and development programs.
- Recognizing and rewarding new behaviors.
Measuring Success in Cultural Change
Key Performance Indicators (KPIs):
- Employee engagement scores.
- Customer satisfaction ratings.
- Productivity and innovation levels.
- Reduction in employee turnover.
Feedback Mechanisms:
- Surveys and focus groups.
- Regular performance reviews.
- Open forums for discussion.
Conclusion
• Cultural change is a long-term process
requiring commitment at all levels.
• Leaders play a crucial role in driving and
sustaining change.
• Organizations must remain agile and
continuously assess cultural alignment with
business objectives.
Case Study
Rebranding in Financial Services
• Scenario: A financial services company aimed to shift
towards a customer-centric culture.
Key Actions Taken:
• Customer segmentation to tailor service strategies.
• Employee role redefinition to align with brand goals.
• Feedback loops implemented for iterative
improvements.
• Leadership involvement to model the cultural shift.
• Outcome: Increased customer satisfaction and
employee engagement.
CASE STUDY
The newly appointed CEO of Jour Production Company is committed
to improving the company's competitiveness by tackling issues
related to high operational costs and low productivity. Meanwhile,
the trade union representing the steelworkers at Jour Production
Company is well-organized and has reassured employees that their
wages and working conditions will be protected.
Requirements:
1.How can the new CEO balance cost-cutting measures while
maintaining employee morale and productivity, given the strong
presence of the trade union?
2.What strategies can the CEO implement to improve operational
efficiency without facing resistance from the trade union?
3.How might the trade union's commitment to protecting wages and
working conditions impact the company's ability to implement
organizational changes?
