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492 Received July 2004 Revised November 2004 Accepted December 2004

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Organizational culture in public sector organizations Promoting change through training and leading by example Mike Schraeder Troy University-Montgomery Campus and Thomas Walter Center for Technology Management, Auburn University, Montgomery, Alabama, USA

Rachel S. Tears Center for Government and Public Affairs, Auburn University at Montgomery, Montgomery, Alabama, USA, and

Mark H. Jordan Air Command and Staff College, Maxwell Air Force Base, Colorado Springs, Colorodo, USA Abstract Purpose – To provide two possible approaches for enhancing organizational culture awareness and promote cultural change in public sector organization. These approaches include training and leading by example. Design/methodology/approach – Literature outlining fundamental aspects of organizational culture is summarized, serving as a foundation for reviewing the potential value of training as a method for enhancing public managers’ awareness of organizational culture. This is followed by an illustrated example of how the culture was changed in major department of a public organization through leading by example. Findings – Training and leading by example can serve as effective methodologies for promoting culture awareness and brining about culture change in organizations. Practical implications – The article highlights some interesting similarities and differences between cultures in public organizations and cultures in private sector organizations. The differences, in particular, reinforce the importance of training and leading by example to guide public sector employees through the complex dynamics often embodied within culture transformations in organizations. Originality/value – While there are some important similarities between cultures of private sector and public sector organizations, the differences existing in public sector organization cultures create unique challenges for managers trying to evoke change. The article provides a unique perspective on applying training and leading by example to the context of public sector organizational culture. Keywords Organizational culture, Public sector, organizations, Leadership, Training Paper type Case study Leadership & Organization Development Journal Vol. 26 No. 6, 2005 pp. 492-502 q Emerald Group Publishing Limited 0143-7739 DOI 10.1108/01437730510617681

Organizational leaders, managers, and academic researchers are demonstrating an increased interest in understanding the concept of organizational culture (Denhardt, 1991; Jreisat, 1997; Zamanou and Glaser, 1994). While specific reasons for this increased interest vary, it is likely that the primary reason for the growing interest

resides in the recognition that organizational culture is an important factor in organizational effectiveness (Denison, 1990). Consequently, “Given that corporate culture is crucial to organizational effectiveness, it follows that a key task of managers is to understand, monitor, and actively manage the culture of their organization” (Davies and Philp, 1994, p. 69). Understanding an organization’s culture can also provide insight into the history of the organization, as well as key events that may have helped shape the identity of the organization (Trice and Beyer, 1993). Indeed, increased knowledge about organizational culture can provide leaders, managers, and researchers with special insight regarding fundamental characteristics of an organization (Schein, 1985), that will, in turn, help in managing or changing the culture. Further, it is important to note that managing an organization’s culture can be one of the most daunting tasks faced by leaders (Schulz, 2001), while monitoring an organization’s culture to ensure that it remains aligned with the external environment is essential to the perpetuity of that organization (Valle, 1999). These factors reinforce the value of examining organizational culture in private organizations and public organizations. Undeniably, recent pressures to improve the efficiency of government to run more like private entities, coupled with increased public scrutiny of government organizations fortify the need for fundamental change within these organizations – change at the most fundamental level which will likely lead to changes in the culture of public sector organizations (Valle, 1999). Prior to examining the specific nuances associated with culture and cultural change within public sector organizations, fundamental aspects of organizational culture are discussed. Organizational culture: background The culture of an organization is often a difficult characteristic to define since many aspects of culture are intangible and cannot be seen (Jreisat, 1997). Despite this difficulty, most authors seem to agree that organizational culture is central to the functioning of an organization. Hofstede et al. (1990) also acknowledge agreement among researchers that organizational culture is holistic, soft, difficult to change, has a historical basis, and is socially constructed. The following definition offers one perspective on the topic: Organizational culture tends to be unique to a particular organization, composed of an objective and subjective dimension, and concerned with tradition and the nature of shared beliefs and expectations about organizational life. It is a powerful determinant of individual and group behavior. Organizational culture affects practically all aspects of organizational life from the way in which people interact with each other, perform their work and dress, to the types of decisions made in a firm, its organizational policies and procedures, and strategy considerations (Buono et al., 1985, p. 482).

Gordon (1991, p. 404) suggests that: [. . .] culture formation is neither a random event nor an action dependent solely on the personalities of founders or current leaders, but it is, to a significant degree, an internal reaction to external imperatives.

Simply stated, Gordon (1991) observes that an organization’s culture is a product of successfully adapting to the environment and will, as a result, resist change. He further notes that a change in the environment might necessitate a change in the culture, going so far as arguing that these changes, which include new learning, can also involve the need for new people.

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Organizational culture: the people perspective The culture of an organization has a profound influence on the behavior of individuals within the organization (Barney, 1986; Trice and Beyer, 1993). According to Barney (1986, p. 660): [. . .] firms that are successful at obtaining productivity through their people generally have an organizational culture that supports and values the worth of the employee.

Some researchers argue that culture is to an organization what personality is to an individual (e.g. Cartwright and Cooper, 1993). As such, they suggest that culture serves as a force drawing organizational members together, creating a sense of cohesion. More importantly, the culture of an organization can serve as an informal control mechanism helping to define acceptable behavior within an organization (Chatman and Barsade, 1995). In addition to providing employees with information that is necessary for them to function within an organization (Jreisat, 1997), an awareness of the organization’s culture also provides guidance allowing employees to be more supportive of the organization’s mission (Schulz, 2001). Schulz further contends that organizations with strong cultures, where employees share common values, enjoy distinct performance advantages over those firms that have weak cultures. Organizations in the service industry, for example, may benefit from strong cultures where values are shared and supported throughout the organization (Chatman and Jehn, 1994). This is an important feature to note given the fact that most public sector organizations are technically classified as “service industry” organizations. Congruence between organizational and individual values (i.e., a strong culture) is also associated with more positive employee attitudes such as organizational commitment and job satisfaction (O’Reilly et al., 1991). Idiosyncrasies of organizational culture in public sector organizations In a general sense, obvious differences exist between private organizations and public sector organizations (Denhardt, 1991). These differences are largely due to the uniqueness of external environment characteristics shaping the boundaries and expectations of these organizations. Recognizing differences in the external environments is important since ample evidence supports the notion that differences in industrial characteristics impact the norms of an organization (Chatman and Jehn, 1994; Gordon, 1991). Specifically, Gordon (1991, p. 404) regards the formation of organizational culture as “. . . an internal reaction to external imperatives”. Today, more than ever, public sector organizations are facing tremendous pressure to adapt to significant changes in the external environment (Valle, 1999). Valle (1999) suggests that managers in public sector organizations must help their employees understand these environmental changes and the urgent need for their organizational adaptation. Indeed, failure to modify the culture of public sector organizations to more closely match environmental exigencies could lead to a continuation or increase in management turnover within these organizations (Valle, 1999). Failure to change may also lead to inertia that could erode public and private confidence in these organizations. This is particularly important at a time when the environment of public sector organizations is becoming more like the environment of private organizations (Valle, 1999). This could, perhaps, explain why public organizations are facing pressures to adopt management techniques utilized by private organizations (Bradley and Parker, 2001). Despite the growing similarities between the environments of public

and private sector organizations, there are still a variety of specific, fundamental differences at the operational and cultural levels of these organizations. Some of these differences are summarized in Table I. So, what can managers do given these differences and the profound challenges faced by public sector organizations to adjust to new pressures? The following two sections offer possible alternatives for promoting cultural change in public sector organizations. The first section discusses the use of training as a possible strategy for instigating cultural change in public sector organizations. The final section describes how leading by example was utilized to bring about cultural change in a department within a public sector organization. Enhancing cultural awareness and promoting change through the use of training An organization’s culture can vary dramatically from the culture idealized by leaders of the organization (Bradley and Parker, 2001) or the culture that is necessary for the organization to remain properly aligned with the external environment (e.g., industry demands, global competition, regulatory mechanisms, etc.). Training and the use of symbolism can play important roles in bringing about changes in an organization’s culture (Valle, 1999). Evidence supporting the value of training in the context of promoting cultural change can be found in a variety of sources. Specifically, training is essential to the success of initiatives such as total quality management (TQM) (Jreisat, 1997) which necessitates changes in the norms, values, and certain structures within the organization. This is important to consider since, “Training programs, for example, assist employees in accepting the new values and designs” (Jreisat, 1997, p. 181). Given the ambiguous nature of organizational culture, training programs aimed at enhancing awareness and promoting cultural change should focus, at a minimum, on topics such as those summarized in Table II. Table II reflects themes and major topics presented to public-sector employees during management training sessions. These topics and themes represent a synthesis of important topics outlined in relevant research (i.e. research cited throughout this article) and the instructors’ judgment of best practices for introducing a conceptual foundation for culture or culture change in public sector organizations. As such, the table presents the topics in a somewhat sequential/progressive manner where topics presented first serve as a foundation for subsequent topics. For example, the first topic summarized in the table relates to organizational culture background. This particular component provides definitions and the origin or culture attributes. This, then, serves as a platform for discussing the impact of internal and external forces on the further development of culture in organizations. In addition to the topics in Table II, training to enhance awareness and promote change can be facilitated by including practical extension questions and hypothetical exercises that give participants an opportunity to apply or think critically about the material covered in the training. For example, if an organization is preparing to undergo significant culture changes from a merit compensation system to an incentive compensation system, training might be enhanced by asking participants to work through a hypothetical exercise that is closely related to their specific situation. This exercise could present a scenario where an organization is confronted with multiple challenges including the need to increase productivity, the need for a more flexible compensation structure, and the need to recruit new talent that is accustomed to

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Marketing

Financial management

Materials procurement

Very competitive, prompting numerous organizations to develop competitive intelligence programs

Depends on organization structure, but is becoming more participatory/team oriented Becoming less policy driven and more results driven Depends on organization structure with larger organizations having certain functions centralized and others decentralized Most successful organizations develop strong relationships with suppliers to promote lower costs and more efficient delivery. Just-in-time supply agreements are not uncommon Major functions are managed at corporate level with appropriate authority to make financial decisions often delegated to division or function level

Decision making

Method may vary based on department and jurisdiction. Lack of consistency can create havoc in obtaining cross-department/cross-agency information The presence of few or no competitors results in sparse marketing efforts. However, public organizations do have multiple stakeholders

Within department: often autocratic legislative/policy level: democratic Very structured and rules oriented Hybrid of elected officials, appointed officials and employees who are hired through traditional methods Bids and contracts which often take longer and do not always result in the most efficient outcome

Public sector organizations

496

General policies and communication Personnel management

Private organizations

Table I. Functional idiosyncrasies between private and public sector organizations

Function

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Components

Background

Definition Role of values, behaviors and norms Role of symbols Impact on organizational effectiveness Differentiating styles of culture Role of leadership and management Impact of internal/external environment Impact of subcultures Communication processes Decision-making processes Benchmarking with other organizations Current competitive environment Trends in customer feedback Internal financial trends External pressure (regulatory, legislative) Internal suggestions or needs Realistic overview of anticipated implications – Emphasize that culture is difficult to change – Highlight possible resistance from employees – Anticipate impact on employees – Discuss value of employee participation

Development of organizational culture Attributes of current organization culture Introducing the need for cultural change

incentive pay. Given the scenario, participants could work in groups to develop some recommended alternatives for the organization. Better yet, participants could be told that their groups represent the senior management of the organization in the scenario who are being asked to prepare a recommendation for the board of directors. While not fail-safe, this approach exposes participants to some of the thought processes, rationale and challenges associated with the need for a similar cultural change in their own organization. Ideally, this exposure would lead to a realization that the changes taking place in their current organization are necessary for the long-term survival of the company, thus evoking their buy-in or support. Further, these exercises reinforce that there is more to culture than meets the eye. As a result, designing these exercises in a way that encourages participants to think critically, beyond surface level assumptions, can help prepare them for the realities associated with true culture change. Table III contains an excerpt from an actual extension activity that was utilized in a recent organizational culture training session for public-sector managers. Enhancing employee awareness and promoting change through leading by example The actions of organizational leaders can also serve as triggers for changing an organization’s culture (Gordon, 1991). According to Trice and Beyer (1993, p. 365): Managerial practices are probably the most potent carriers of cultural meaning. As the proverb says, actions speak louder than words.

The following summary is a true account of the efforts taken by a leader (henceforth referred by the pseudonym “Randy”) to change the culture of a department in a public sector organization. The summary is provided in a sequential, illustrative fashion to

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Table III. Sample extension activity: informal assessment of culture cues

Note: This activity was developed for exclusive use by the Alabama Certified Public Manager Program and is the property of Auburn University at Montgomery’s Center for Government

Our staff meetings usually start about 15 minutes late. Once they get started, there is usually a lot of emotional debate and defensive interaction. If people disagree with something being said, they are quick to interrupt the speaker The last Friday of every month, our department has a BBQ or luncheon for employees that is paid for by our company. Supervisors usually make a special dessert and serve us I was trying to finish up an important year end report. Because of delays in getting information, I was way behind. My supervisor and three other co-workers volunteered to stay late and help me get the report done When a customer calls with a complaint, we put them on hold for a while and hope they hang up. If they call back, we listen politely but rarely do anything else to take care of their complaint I recently started working for a new department. During my first week, our supervisor gave our work group a critical assignment that needed to be completed by the end of the week. As a result, I made arrangements to work late each afternoon to get the project completed. However, I noticed that all of my co-workers came in at 7 a.m. and left at 4 p.m. each day, as usual

Instructions: The following table contains a list of employee statements related to their workplace. Evaluate each statement to identify what the statement reveals about the organization’s culture. List your assessment of the statement in the column next to each statement What does this statement/scenario reveal about the Statement/scenario culture of this organization?

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provide the reader with insight regarding the context within which the cultural changes were made. The origins of inertia: the culture of the department and an overview of the original mindset When the new supervisor (Randy) joined the department, morale and work ethic of the department were poor. This was manifested in curriculum that had not been significantly changed in three years, members of the department bypassing the chain of command, individuals expressing a desire to leave the department, and a dearth of volunteers offering to help teach the year-long course as adjunct faculty. Randy’s opinion was that there was no vision from the leadership, and no mutual trust relationship between leadership and members of the department, nor among the department members. During his first seven months as a member of the department, Randy’s goals were to exhibit an aggressive work ethic, constantly display a positive attitude, and show enthusiasm for the mission of the department. Additionally, he spent much time building a good working relationship with the leadership in the department and his co-workers. The genesis of change: a summary of the process As a function of being promoted to the leadership role of the department, Randy consciously used Schein’s (1992) culture embedding mechanisms to try to change the culture and climate of the department, these are summarized below: (1) What leaders pay attention to, measure, and control on a regular basis. (2) How leaders react to critical incidents and organizational crises. (3) Observed criteria by which leaders allocate scarce resources. (4) Deliberate role modeling, teaching, and coaching. (5) Observed criteria by which leaders allocate rewards and status. (6) Observed criteria by which leaders recruit, select, promote, retire, and excommunicate organizational members. By focusing on change using the culture embedding mechanisms, Randy was not only able to change the artifacts, or the visible organizational structures and processes (Schein, 1992) in the organization (i.e. pictures on the walls, office setup, ceremonies, etc.), but was also able to affect the underlying values (strategies, goals, philosophies), which represent a deeper part of an organization’s culture. According to the personal account of one department member, Randy’s goal was to first change some of the artifacts in the organization so the members could see visible improvement. In order to have maximum impact with the members of the organization, the artifact changes had to be backed up with the espoused values (embedding mechanisms) of the leader (i.e. Randy). Several examples are instructive. The first step in culture change was a departmental meeting in which Randy spent approximately one hour with the department members expressing his leadership philosophy and highlighting his personal belief in the importance of teamwork, while also emphasizing the advantage and value of developing into a “high-performing team”. As part of Randy’s leadership philosophy presentation, he adopted a name for the department – “TeamOne.” The meaning of TeamOne was twofold: first, whether

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the team succeeded or failed, it succeeded and failed as a team. If someone from the team discussed anything with someone outside the department, they were speaking for the team – the team would exercise the chain of command. Second, team members had to believe that the curriculum was the most important curriculum the students would be taught. Randy used embedding mechanisms to back up these artifact changes. For instance, Randy developed the TeamOne Contributor Award (Eagle Statue) that was presented (embedding mechanism number 5 above) each week to the person who advanced TeamOne in some significant way during that week. In addition to receiving the rotating statue, the winner was also given the privilege of using Randy’s parking space – a highly coveted space in front of the office building. For culture change to be successful, one must not only change the artifacts, but also live the changes in the things he/she does. For instance, instituting the TeamOne Contributor Award (artifact) had to be followed with day-to-day actions. One of the evaluation criteria Randy used to rate the members of the department was what they, as individuals, did to improve and build the team during the rating period. This aspect of team member ratings was also discussed in initial and mid-term (six-month) feedback. Randy, by using teamwork as an evaluation criterion, made clear to the department members what he thought was important. The second step was to change some of the artifacts in the department. The physical location of the department was in the corner of the building, which also housed much of the older office furniture. The layout of the offices was incongruent with a professional office appearance. The first leadership initiative undertaken was to convert one of the larger office areas into a comfortable and appealing conference room named the TeamOne Conference Room. In addition, Randy converted one of the smaller rooms to consolidate the copier and the snack area, also creating a reading area with a leadership library (consisting of relevant books and videos). The department members spent two full days cleaning and arranging the entire department with the goal of making the department more organized, functional, and appealing. These changes required a realignment of the department’s budget (embedding mechanism number 3 – observed criteria by which leaders allocate scarce resources). As another step in culture development and transformation, Randy took the department to a “ropes” course (embedding mechanism number 1 – what leaders pay attention to, measure, and control on a regular basis) for a day to participate in various teambuilding tasks. This offsite enhancement activity had at least three benefits: (1) the opportunity to interact with fellow members outside the work environment; (2) learning one anothers’ strengths and weaknesses; and (3) starting to develop as a team. It is important to note that Randy participated in all the tasks and led the way (embedding mechanism number 4 – deliberate role modeling, teaching, and coaching). An operational example also reinforces the value of leading by example. During the administration of an examination an error was realized in the computer template the students were using which could have led to inequalities among student papers. It would have been easy to keep it quiet as few would likely notice and the students could have been reprimanded for not making sure the template was correct. Instead, Randy chose the more difficult path, the path demonstrating integrity and the importance of fairness for the students. No blame was placed on any member of the department;

instead the entire team launched into action to inform all 580 students of this error, apologizing (embedding mechanism number 2 – how leaders react to critical incidents and organizational crises) for the inconvenience. As a final example, each member of the department took a leadership assessment instrument (as a preview of giving the instrument to the students). This was followed by feedback from a consultant on the analysis of the leadership instrument. Randy chose to allow his personal report to be used as a teaching tool. The goal of the instrument was to get the students to open up and discuss their leadership strengths and weaknesses with each other and with faculty. Randy’s example of allowing his own strengths and weaknesses to be explored in detail by the departmental staff established a precedent within the department for staff members to do the same with their students (embedding mechanism number 4 – deliberate role modeling, teaching, and coaching). The effectiveness of the approach: the leader’s retrospective According to Randy, the efforts to initiate cultural change through leading by example have been a tremendous success. These efforts have motivated a group of individuals to work as a team, search for opportunities to assist each other, and display enthusiasm and a sense of pride in their department. One way in which success can be gauged, is by the number of individuals requesting to work in, as well as adjunct for the department. When Randy arrived, the departmental leadership was literally begging people to work for the department. In a span of ten months, more individuals have sought to work in Randy’s department than were positions available. Additionally, the ratings from the students on courses have improved in eight of the ten rating areas and the senior leadership publicly highlights the excellence in the department. While the transformation experienced within this department is impressive, it is important to note, however, that a definitive causal link between Randy’s actions and the changes in the department cannot be established based simply on the information summarized in this article. Indeed, there are certainly other plausible explanations that could be explored and the fact that results summarized here are presented from Randy’s perspective should be taken into consideration. Conclusion Public sector organizations are facing incredible pressures to adjust to the new, evolving demands of their constituencies. These new demands will likely necessitate changes in the cultures of these organizations. This article has discussed promoting change in public sector organizations through training and through leading by example. While the culture of an organization is constantly evolving (Trice and Beyer, 1993), it is important to note that fundamentally changing an organization’s culture is a long-term endeavor. To some extent, the lengthy nature of the cultural change process could be a by-product of the resistance that might accompany some planned changes to an organization’s culture (Barney, 1986). In fact, it is important for leaders to recognize that changing an organization’s culture may evoke emotional reactions from employees (Trice and Beyer, 1993). Providing employees with training should help mitigate some of these reactions by laying a foundation to support changes in an organization’s culture. In addition, the example(s) set by leaders within an organization can have a profound impact on the willingness of employees to support or resist cultural change. Also, as illustrated with the example of TeamOne, allowing employees

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to participate and become involved in making the changes in the culture can have a profound impact on their willingness to buy-in to the changes. Regardless of the approach taken, leaders should remember that communication plays a powerful role in changing an organization’s culture (Zamanou and Glaser, 1994). References Barney, J.B. (1986), “Organizational culture: can it be a source of sustained competitive advantage”, Academy of Management Review, Vol. 11 No. 3, pp. 656-65. Bradley, L. and Parker, R. (2001), “Public sector change in Australia: are managers’ ideals being realized”, Public Personnel Management, Vol. 30, September 22, pp. 349-61. Buono, A.F., Bowditch, J.L. and Lewis, J.W. (1985), “When cultures collide: the anatomy of a merger”, Human Relations, Vol. 38 No. 5, pp. 477-500. Cartwright, S. and Cooper, C.L. (1993), “The role of culture compatibility in successful organization”, The Academy of Management Executive, Vol. 7 No. 2, pp. 57-69. Chatman, J.A. and Barsade, S.G. (1995), “Personality, organizational culture, and cooperation: evidence from a business simulation”, Administrative Science Quarterly, Vol. 40, pp. 423-43. Chatman, J.A. and Jehn, K.A. (1994), “Assessing relationships between industry characteristics and organizational culture: how different can you be?”, Academy of Management Journal, Vol. 37, June, pp. 522-53. Davies, B. and Philp, A. (1994), “Monitoring company culture”, Personnel Management, Vol. 26 No. 5, p. 69. Denhardt, R.B. (1991), Public Administration: An Action Orientation, Brooks/Cole Publishing, Pacific Grove, CA. Denison, D.R. (1990), Corporate Culture and Organizational Effectiveness, John Wiley & Sons, New York, NY. Gordon, G.G. (1991), “Industry determinants of organizational culture”, Academy of Management Review, Vol. 16, pp. 396-415. Hofstede, G., Neuijen, B., Ohayv, D.D. and Sanders, G. (1990), “Measuring organizational cultures: a qualitative and quantitative study across twenty cases”, Administrative Science Quarterly, Vol. 35, June 1, pp. 286-316. Jreisat, J.E. (1997), Public Organization Management: The Development of Theory and Process, Praeger, Westport, CT. O’Reilly, C.A., Chatman, J.A. and Caldwell, D.F. (1991), “People and organizational culture: a profile comparison approach to assessing person-organization fit”, Academy of Management Journal, Vol. 14, pp. 487-516. Schein, E.H. (1985), Organizational Culture and Leadership, 1st ed., Jossey-Bass, San Francisco, CA. Schein, E.H. (1992), Organizational Culture and Leadership, 2nd ed., Jossey-Bass, San Francisco, CA. Schulz, J.W. (2001), “Tapping the best that is within: why corporate culture matters”, Management Quarterly, Vol. 42, pp. 29-35. Trice, H.M. and Beyer, J.M. (1993), The Cultures of Work Organizations, Prentice-Hall, Englewood Cliffs, NJ. Valle, M. (1999), “Crisis, culture and charisma: the new leader’s work in public organizations”, Public Personnel Management, Vol. 28 No. 2, pp. 245-57. Zamanou, S. and Glaser, S.R. (1994), “Moving toward participation and involvement”, Group & Organization Management, Vol. 19, pp. 475-502.