Corporate Culture: Definitions and Factors, Study notes of Business Administration

Download Corporate Culture: Definitions and Factors and more Study notes Business Administration in PDF only on Docsity! Introduction: Corporate culture is a synthesis of management styles, values and 2 0 1 6communications styles. It is generally understood as ―The way things are done In an organization. It describes the situation not as stated but as practiced. Though organizational structure, System, policy and strategy direct and channelize the workflow, the actual behavior of people is condit ioned by corporate culture. It is intangible and hard to quantify. There are several factors that bear a significant influence in shaping the Management style of an Organisation. These include the leadership style, organizational factors, motivational methods and tools, as well as communication styles and methods. Corporate Culture Definitions ■―Consists of a set of symbols, ceremonies, and myths that communicate the 2 0 1 6underlying values and beliefs of that organization to its employees. - Ouichi 1 ■―The way we do things around here.‖ Many articles and books have been written in recent years about culture in organizations, usually referred to as "Corporate Culture." The dictionary defines culture as "the act of developing intellectual and moral faculties, especially through education." This writing will use a slightly different definition of culture: "the moral, social, and behavioral norms of an organization based on the beliefs, attitudes, and priorities of its members." The terms "advanced culture" or "primitive culture" could apply to the first definition, but not the latter. Every organization has its own unique culture or value set. Most organizations don't consciously try to create a certain culture. The culture of the organization is typically created unconsciously, based on the values of the top management or the founders of an organization. Hewlett-Packard is a company that has, for a long time, been conscious of its culture (The HP Way) and has worked hard to maintain it over the years. Hewlett - Packard's corporate culture is based on 1) respect for others, 2) a sense of community, and 3) plain hard work (Fortune Magazine, May 15, 1995). It has been developed and maintained through extensive training of managers and employees. HP's growth and success over the years has been due in large part to its culture. Another successful company that expends a lot of energy in maintaining its workplace culture is Southwest Airlines. Southwest is the only major airline in the U.S. that has been profitable in each of the last five years. It also has a good reputation as an employer. In an article written in the ACA (American Compensation Association) Journal, Winter 1995 issue, Herb Kelleher, Southwest's CEO, indicated how Southwest maintained its culture: "Well, first of all, it starts with hiring. We are zealous about hiring. We are looking for a particular type of person, regardless of which job category it is. We are looking for attitudes that are positive and for people who can lend themselves 3 There's some debate over whether companies should design their personnel policies and reward systems around cultural values. Currently companies tend not to, because of the concern about stereotyping certain cultures. A popular trend is for companies to "reengineer" themselves, which involves an attempt to change their culture, usually to a team orientation. Studies indicate that the following are necessary for a company to change to a "team culture:" • Common and consistent goals • Organizational commitment • Role clarity among team members • Team leadership • Mutual accountability with the team • Complementary knowledge and skills • Reinforcement of required behavioral competencies • Power (real and perceived) • Shared rewards The importance of corporate culture is growing as the result of several recent developments. Companies are encouraging employees to be more responsible and act and think like owners. In exchange for more flexible work schedules, employees are expected to always be "on-call." With the demise of more traditional communities (e.g. neighborhoods, etc.), companies are filling employees' need to belong to a community. At the same time companies are encouraging teamwork and the formation of teams. Therefore, organizational leaders shouldn't ignore corporate culture. Rather, it should be addressed in the organization's mission, vision, and goal statements, and emphasized in company sponsored training and company communication. The statements should include the following: 4 Most organizations try to mitigate the unsettling effects of change by planning for it on an ongoing basis, rather than just reacting to crises that arise. Preparing for change may be assisted by a nine-step process: 1. Recognizing the need for change 2. Developing goals 3. Selecting a change agent 4. Diagnosing the problem 5. Selecting the intervention method 6. Developing a plan 7. Planning for implementation 8. Implementing the plan 9. Following up and evaluating Various strategies can assist in promoting change within the organization such as developing mutual trust, establishing an environment of organizational learning and remaining adaptable. The basic problem is that change efforts fail because people resist change! There are many reasons for resistance such as loss of security, fear of economic loss, loss of power and control, old habits, selective perception, and weaknesses in the proposed change. Aggravating factors are faulty thinking, inadequate process, and lack of resources, lack of time or poor timing, and a resistant culture. Some of the techniques for overcoming resistance to change are invited participation, open communication, giving advance warning, maintaining sensitivity, and offering security in the face of change. 6 Change in an individual is usually enabled by a change in skills, knowledge, or attitude. Two approaches to this are the ―three step approach‖ (unfreezing, change, freezing) and ―force-field analysis‖ (overcoming the status quo by weakening the forces of resistance).Organizational development is the system of maintaining a climate where adaptability to change can be a constant through the use of diagnostic and change strategies. Management of change has dominated much of the recent management literature, and for good reason since it is of critical importance to most companies in the information age. Corporate communication: extended definition By corporate communication we mean the corporation's voice and the images it projects of itself to the various stakeholders. This includes areas such as corporate reputation, corporate advertising, and employee for communications, government relations and media management. We shall be discussing them at a later stage one by one. These days most of the bigger organizations have departments of corporate communication which appeared on the organizational chart along with traditional functions like marketing or accounting. The addition, corporate communication is also the processes accompany uses to communicate all its messages to key constituencies - a combination of meetings, interviews, speeches, reports, images advertising, and online communication. Ideally, corporate communication is an attitude of toward communication or a set of mental habits that employees internalize. The result is good communication practices that permeate an organisation and are present in all its communications with constituencies. Corporate communications are defined as the products of communication, be they memos, letters, reports, websites, e-mails, speeches or new releases. In the 8 because the very survival of entrepreneurial organizations depends on their ability to manage communications with investors, potential and current partners, employees, suppliers and customers.