For a group to function and develop, one of the most important areas for clear consensus is the perception of who is in the new group and who is not in, and the criteria by which such decisions are made. New members cannot really function and concentrate on their primary task if they are insecure about their membership, and the group cannot really maintain a good sense of itself if it does not have a way of defining itself and its boundaries.
Initially, the criteria for inclusion are usually set by the leader, founder, or convener, but as the group members interact, those criteria are tested, and a group consensus arises around the criteria that survive the test. In a young company, there is often intense debate over who should be an owner or a partner, who should have stock options, who should be hired for key functions or be an officer, and who should be ejected because he or she does not fit in. In this debate, real personnel decisions are being made, and at the same time, the criteria of inclusion are being forged, tested, and articulated so that they become clear to everyone. Such debate also provides opportunities for testing mission statements, goal clarity, and means clarity, illustrating how several cultural elements are simultaneously being created, tested, articulated, and reinforced.
One way of determining a group ’s core assumptions is to ask present members what they really look for in new members and to examine carefully the career histories of present members to detect what accounts for their inclusion in the group. For example, when I inquired about DEC ’s hiring process, the answer was that every potential new member of the technical or managerial staff had to be interviewed by at least five to ten people, and only if that individual was acceptable to the entire set, was he or she offered a job. Interviewers seemed to be looking for intelligence, self-reliance, the ability to articulate clearly, tolerance for ambiguity, and high motivation. But when asked, they usually just said, “We want someone who will fit in.”
After DEC hired people, they were provisionally accepted as permanent members. If they failed in an initial job assignment, the assumption was that they were competent but had been put in the wrong job. In other words, once a person was “ in,” it was difficult to lose that status. In an economic crisis, the company tended to slow down its rate of hiring but was very reluctant to lay off anybody. And when pressures for staff reduction mounted, the organization redefined layoffs as “transitions” in which employees were given a great deal of latitude and choice.
In Ciba-Geigy, prior education was a key criterion for membership. Most of the young technical and managerial staff members came from a scientific background, highlighting the assumption that to succeed in the company, an individual must understand the scientific base on which it was built. Having an advanced degree, such as a doctorate, was a distinct advantage even if the individual was being hired into a marketing or managerial job.
Both DEC and Ciba-Geigy had difficulty hiring and absorbing what they called MBAs, by which they meant all-purpose generalists who do not have a solid technical or scientific background and who might be more concerned with personal ambition than contributing to the technical work of the organization. Behind these perceptions lay the further assumption (in both of these companies) that general management, though necessary, was not the key to success. Scientific and technical know-how was essential. These assumptions had a powerful impact on DEC ’s later inability to develop in different directions and to divisionalize because there was always a shortage of experienced general managers.
Who is in and who is out applies not only to the initial hiring decision but also continues to have important symbolic meaning as an individual progresses in the group. One of the immediate consequences of defining who is in and who is out is that differential treatment rules begin to be applied. Insiders get special benefits, are trusted more, get higher basic rewards, and most important, get a sense of identity from belonging to a defined organization. Outsiders such as contract workers not only get fewer of the various benefits and rewards but, more important, lose specific identity. They become part of a mass labeled “outsiders,” and they are more likely to be stereotyped and treated with indifference or hostility.
Organizations can be thought of, then, as involving three dimensions of career movement: (1) lateral movement from one task or function to another, (2) vertical movement from one rank to another, and (3) inclusionary movement from outsider to insider (Schein, 1978, 2006). Consensus forms around criteria not only for promotion but also for inclusionary movement. As people move farther “in,” they become privy to some of the more secret assumptions of the group. They learn the special meanings attached to certain words and the special rituals that define membership—such as the secret fraternity handshake—and they discover that one of the most important bases for status in the group is to be entrusted with group secrets. Such secrets involve historical accounts of how and why some of the things in the past really happened, who is really part of the dominant coalition or insider group, and what some of the latent functions of the organization are. In the senior management at Ciba-Geigy, there was a “Basel aristocracy,”— board members or senior executives, who were in their jobs by virtue of their social position as well as their technical excellence—but you had to be a real insider to know who they were.
As organizations age and become more complex, the problem of defining clear external and inclusionary internal boundaries becomes more complex. More people—such as salespeople, purchasing agents, distributors, franchisees, board members, and consultants—come to occupy boundary- spanning roles. In some industries, economic circumstances have made it necessary for companies to reduce the size of their workforce, causing an increase in the hiring of temporaries or contract workers, who can be laid off more easily if necessary. Cultural assumptions then come into bold relief when certain questions are raised from a policy perspective: What is a “temporary?” For how long can we keep people in that status? To what benefits if any are they entitled? How do we train them quickly in the essentials of the culture? How do we deal with the threat that temporaries pose to more permanent members of the organization (Kunda, 1992; Barley and Kunda, 2001)?
In a complex society, individuals belong to many organizations, so their identity is not tied up exclusively with any one organization. Locating and defining what a given cultural unit is becomes more difficult because within a given organization, there may be many subcultures reflecting other memberships, occupational identities, or macrocultural origins. It was alleged that at one time the sailors in the U.S. Navy who managed the cooking and serving of food were all Filipinos. In any event, the criteria for membership are always one means of determining whether a cultural unit exists in any given group, and seeking consensus on those criteria will always be a preoccupation of any given group in order to differentiate itself from other groups. Wearing special badges or uniforms is, of course, the obvious means of showing identity. A set of communication rules—the meaning of acronyms and special jargon developed within the new culture—is also one of the clearest ways that a group specifies who is “us” and who is “them.”
In summary, defining the criteria for deciding who is in and who is out of an organization or any of its subunits is one of the best ways to begin to analyze a culture. Moreover, the very process by which a group makes those judgments and acts on them is a process of culture formation and maintenance that forces some integration of the external survival issues and the internal integration issues.
Source: Schein Edgar H. (2010), Organizational Culture and Leadership, Jossey-Bass; 4th edition.