Climate Control for Organizations

It is generally accepted that the time we live is a period of rapid and accelerated change. Leaders spend much of their time discussing how to respond to this change, and what an effective organization should look like.

Last week I was reminded about the concept of organizational climate as developed by Dr. Likert. I am probably more familiar with corporate culture, which is somewhat similar. Organizational climate involves motivation, communication, interaction, decision- making, goal setting, control, and performance. When all of these things are looked at, organizations can be classified into four categories:

1. coercive: Leaders have little confidence or trust in employees, seldom involve them in decision making. Decisions are top down. Lower levels oppose goals established by upper levels.

2. competitive: Leaders have condescending confidence, but occasionally involve employees in decision processes. Some decisions at lower levels, but control is definitely at the top. Lower levels cooperate in setting organizational goals.

3. consultative: Leaders have substantial although not complete confidence, yet involve employees frequently in decisions. Many decisions are made at lower levels; top level consults with employees. Lower levels attempt to improve morale and cooperate to achieve organizational goals.

4. collaborative: Leaders demonstrate confidence and trust in employees, who are involved in many aspects of decision making. Decisions are widely dispersed. Collaboration is found throughout the organization.

The most effective organizations over time are those that are consultative and collaborative. This is especially true during periods of rapid change.

Another interesting concept is that the characteristics that describe an organization are relatively enduring over time. Why is that? Why do organizations and institutions seem to have their climate ingrained into the fabric of their existence, and just do not change over the long term? I am not sure the answers are clear or easy to determine.

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2 thoughts on “Climate Control for Organizations

  1. I appreciate Terry’s reminder about Likert because Category 4 (or System 4 in some of Likert’s writing) would seem to be the “Web 2.0” organization.
    The challenge for the leaders — Steve lists some famous ones — is indeed, as I heard a CEO admit just this week, is how to move the culture toward Category 4 as seen by the bulk of employees. The CxO’s may be shielded in many cases from reality.
    The real test comes when there is pressure on the firm to improve performance. Too often, Likert said, the leaders tend to more back toward Category 1 when there are challenges. This could be short-term gain at the expense of long-term profit because it discourages employees.
    Web 2.0-enabled firms would seem more resistant to moves in the Category 1 direction. That’s my hypothesis, anyway.
    Dan

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