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The Role of Organizational Culture 247

• Culture is often transmitted through stories and myths that extol certain virtues
held to be important to the organization. These stories are often told in informal set-
tings as well as published in company newsletters. For example, when new employees
join an organization, they are not only handed manuals and directed to databases
containing forms to be fi lled out, but they are regaled with stories of key events in
the organization ’ s history, stories relating spectacular successes and disappointing
failures. These stories have a strong message that relays “ how things are done around
here ” to the new employees.
• In reacting to crises, leaders can send strong messages about values and assumptions.
When a leader supports new values in the face of crisis, when emotions often run
high, he or she communicates that this value is very important. For example, if the
organization has repeatedly supported a strong notion of professional ethics and ends
up losing a bid to a competitor who did not bother about such niceties, it is even
more powerful if the organization ’ s leaders reinforce this message in the face of and
in spite of the crisis situation they are in. In this way, everyone can see that values
are not being treated as “ fair-weather friends, ” that is, values are not adhered to when
it is convenient to do so and dropped when challenges arise.
• In addition to motivating behavior directly, a reward system can send powerful
messages regarding what is important. For example, if a university declines to promote
a professor who has won the university-wide Outstanding Teaching award, this sends
out the strong message that teaching was not valued and only research productivity
is really valued at this particular institution.
• Important and public decisions also communicate the importance of certain values.
If the fi rst thing to be cut in budget crunches is training, it sends the message that
training is not valued. The criteria for allocation of resources often become what are
valued in an organization. For example, if budgets were determined by steady past
performance, it sends a different message than if they were determined by past inno-
vation and risk taking.
• Leaders communicate the importance of values by what they praise and what they
criticize. It is important to pay attention to what is said. Social values are often
changed through the selection process. As new members are hired, effort is made to
hire new members that hold the new value. Different organizations will elect to imple-
ment this reward (praise) and censure (criticize) cycle differently. For example, at
Buckman Labs, employees who have been voted the “ top 100 knowledge sharers ” are
invited to take a trip to the head offi ce where the President of the company bestows
a gift of a fully loaded laptop to them in recognition of their excellent KM work. This
organization is further described in box 7.2.