BUSINESS111 Chap.8 Organisational Culture and Structure
Organisational Culture and Structure
What people share and how work is arranged
This chapter defines organisational culture, separates its observable artefacts, espoused values and basic assumptions, and shows how employees learn it through symbols, stories, heroes and rituals.
It places clan, adhocracy, market and hierarchy cultures on the competing values grid.
Structure in service of strategy
It compares functional, divisional, matrix and flat structures, with their strengths, weaknesses and best uses, and links culture and structure to Porter's generic strategies, which is the relationship the course's practice questions test.
The exam question this chapter prepares
A practice question for the final asks how an organisation's structure supports or inhibits its operations and how structure relates to culture.
The chapter's worked example and practice cards rehearse that analysis with invented firms: name the structure from reporting lines, read the culture from its artefacts and values, test both against the strategy, and recommend one change.
What this chapter covers
- 01
Defining organisational culture
- 02
Three levels of culture
- 03
How employees learn culture
- 04
Clan, adhocracy, market and hierarchy
- 05
Four ideal-typical structures
- 06
Aligning strategy, culture and structure
Worked example · free
Explain how structure helps or hinders operations
- 1Understanding key concepts: define the structure accurately.
- 8Application, analysis, judgement and justification: weigh the benefits and costs shown in the facts and conclude.
- 1Communication and structure: one clear paragraph within 250 words.
Key terms
- Organisational Culture
- The beliefs and values members of an organisation come to share, which steer how they behave.
- Espoused Values
- The values an organisation and its members say they hold.
- Adhocracy Culture
- An externally focused, flexible culture that prizes innovation and risk-taking.
- Matrix Structure
- A hybrid structure in which employees report to both a functional manager and a project or product manager.
- Flat Structure
- A structure with few or no middle managers in which decisions are pushed down to staff.
- Divisional Structure
- A structure of self-contained units organised by region, product or customer group.
- Hierarchy Culture
- A structured, formalised culture that values stability, procedures and predictability.
Organisational Culture and Structure FAQ
Which organisational structure is best?
None in itself. Canvas stresses that each structure has trade-offs, and the right choice depends on the culture the organisation wants to foster, its strategy and its industry. Answers should therefore judge fit rather than rank structures.
How do I identify the culture type in a scenario?
Look at the evidence for focus and values. Collaboration and mentoring suggest clan; risk-taking and new products suggest adhocracy; competition and results suggest market; procedures and predictability suggest hierarchy. Then test whether that culture fits the firm's strategy.
What are the three levels of culture?
Observable artefacts are what you can see, espoused values are what people say matters, and basic assumptions are beliefs so deeply held that nobody states them. The levels run from visible to invisible.
How does structure relate to strategy?
Canvas links each generic strategy to a structure: cost leadership to a functional structure for tight control, differentiation to a matrix or flat structure for collaboration, and focus to a divisional structure that lets one unit serve one segment. Use the link to judge whether a structure fits.
How do employees learn an organisation's culture?
The Week 7 lecture names four channels: symbols, stories, heroes, and rites and rituals. Spotting one of these in a scenario lets you use culture as evidence, for example a founder story repeated to every new hire or a weekly ritual that celebrates customer service.
Exam move
Pick an organisation you belong to and list three artefacts, two espoused values and one assumption you can infer. Place it on the competing values grid. Then sketch its structure as a simple chart and name the type. Finally, write a paragraph on whether its culture and structure support its strategy, ending with one change you would recommend and why. Then rewrite your recommendation so it names the strategy it supports.
Keep your four structure sketches on one page for quick revision. Practise naming the culture type in the first sentence of every answer.
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