Assessing the relationship between industry characteristics and organizational culture: How different can you be?

Organizations have discernible differences based on industry norms (cf. Pennings & Gresov, 1986). Just as task environments affect how organizations are structured, assumptions about important constituents lead to similar values among same-industry organizations (Gordon, 1991). In an effort to understand the forms and consequences of organizational culture, researchers have explored how various processes, such as individual and organizational selection and socialization (Harrison & Carroll, 1991), and characteristics of powerful members--such as an organization's founder (e.g., Boeker, 1989; Schein, 1985) or groups of members (e.g., Schneider, 1987)--influence the content and intensity of and the consensus that exists about organizational values. In addition to these internal features, features present in the industry an organization operates in, such as the technology used and the rate of growth, may also affect the uniqueness of an organization's culture. Of course, such influence does not preclude meaningful cultural variation across firms in the same industry, but less variation may occur among firms working on the same tasks, using similar procedures, and experiencing similar opportunities to grow than occurs across industries. Since little theoretical attention and even less empirical research has focused on the effects of industry membership on organizational culture (Dansereau & Alluto, 1990), in the present study we sought to understand this important source of influence.

We began by distinguishing between industry culture and the effects of industry characteristics on organizational culture. Focusing on the influence of industry characteristics on organizational culture explicitly acknowledges that culture also varies across organizations, even among firms in very homogeneous industries (e.g., Chatman, 1991). Further, from a functionalist perspective, organizational culture may only be a source of sustained competitive advantage if it is valuable, rare, and imperfectly imitable (Barney, 1986). Therefore, it is important to understand the extent to which cultural variation actually exists across firms and industries and to distinguish actual variation from a mere illusion of uniqueness (Martin, Feldman, Hatch, & Sitkin, 1983).

Our understanding of the relationship between industry characteristics and organizational culture is constrained by empirical weaknesses in previous research. For example, samples have been small and unrepresentative (Grinyer & Spender, 1979) and industry categorization schemes too general to yield insights about the relationship between industry characteristics and organizational culture (Gordon, 1985). qualitative approaches (Phillips, 1991) have generated rich descriptions...