How to structure the leadership of large corporations – and specifically whether to split or combine the roles of Chairman and CEO – remains an active and often controversial question.
In order to cast new and up-to-date light on the question of whether and when to change the Chairman-CEO structure, we studied the experience of the Fortune 100 over the last decade and more. In this report we share our observations, conclusions, and recommendations regarding leadership structure, including the increasingly important role of independent Lead Director whenever the Chairman and CEO roles are combined.
How to structure the leadership of large corporations – and specifically whether to split or combine the roles of Chairman and CEO – remains an active and often controversial question.
In order to cast new and up-to-date light on the question of whether and when to change the Chairman-CEO structure, we studied the experience of the Fortune 100 over the last decade and more. In this report we share our observations, conclusions, and recommendations regarding leadership structure, including the increasingly important role of independent Lead Director whenever the Chairman and CEO roles are combined.
HR can play a role in mergers and acquisitionsNetZealous LLC
HR is the organization’s facilitator, carrying out a wide variety of tasks that lubricate all the processes the organization carries out. It can play a supporting cast in a number of areas. M & A is one of the main activities that HR can support. HR can involve itself with the M & A process at the time of initiation. It can consult management and be a part of the discussion at the estimation change. While bargaining on the deal may be a management issue in which HR may have an ancillary role; HR has a lot to contribute when it comes to preparing the organization for a lot of work that needs to accompany M & A. It can handle all the people-related aspects of HR. The following are some of the areas in which HR can play a very important role in a merger or acquisition.
January 23rd, 2012
What Is CEO Talent Worth?
By Professor, David F. Larcker and Brian Tayan, Researcher, Corporate Governance Research Program, Stanford Graduate School of Business
January 24, 2012
The topic of executive compensation elicits strong emotions among corporate stakeholders and practitioners. On the one hand are those who believe that chief executive officers in the United States are overpaid. On the other hand are those who believe that CEOs are simply paid the going fair-market rate.
Much less effort, however, is put into determining whether total compensation is commensurate with the value of services rendered.
We examine the issue and explain how such a calculation might be performed. We ask:
* How much value creation should be attributable to the efforts of the CEO?
* What percentage of this value should be fairly offered as compensation?
* Can the board actually perform this calculation? If not, how does it make rational decisions about pay levels?
Read the attached Closer Look and let us know what you think!
The record of mergers and acquisitions have not been impressive all over the world. Most of these deals fail or are unable to achieve its projected growth and targets. The most common reason responsible for the failure of M&A deals are the cultural differences in the organisations. This paper discusses the reasons why most M&A deals fail with help of 2 examples.
Ford financial crisis which has escalated over the last few years has been mainly triggered by the executive bureaucracy and royal hierarchy which is fashioned to the Ford family ties, the new appointed chief executive Alan R. Mulally articulates that the working atmosphere in this organization is very reclusive, information and communication among production stage shop floor taskforce is prohibited, this fact rationalize the employees making errors and been unable to correct them which has led to the corporation loss of $1.2 billion dollars. This fact has led to Ford degeneration to symbol of inefficiency, projected y the fact that the executive are reluctant making the culture of this organization to be dysfunctional and defeatist conflicting resulting to losing to the new Cerberus Chrysler management in sales as voiced by Kiley (2007). The case study evaluates three question that are aligned with the organization atmosphere, centrally emphasizing on fords main flaws which have degenerated to dysfunctional conflict, the role that the new chief executive Mulally has patterned to combat this conflict and will analyzed Mulally intervention of the incident involving Consumer Reports staff and two senior Ford engineers.
HR can play a role in mergers and acquisitionsNetZealous LLC
HR is the organization’s facilitator, carrying out a wide variety of tasks that lubricate all the processes the organization carries out. It can play a supporting cast in a number of areas. M & A is one of the main activities that HR can support. HR can involve itself with the M & A process at the time of initiation. It can consult management and be a part of the discussion at the estimation change. While bargaining on the deal may be a management issue in which HR may have an ancillary role; HR has a lot to contribute when it comes to preparing the organization for a lot of work that needs to accompany M & A. It can handle all the people-related aspects of HR. The following are some of the areas in which HR can play a very important role in a merger or acquisition.
January 23rd, 2012
What Is CEO Talent Worth?
By Professor, David F. Larcker and Brian Tayan, Researcher, Corporate Governance Research Program, Stanford Graduate School of Business
January 24, 2012
The topic of executive compensation elicits strong emotions among corporate stakeholders and practitioners. On the one hand are those who believe that chief executive officers in the United States are overpaid. On the other hand are those who believe that CEOs are simply paid the going fair-market rate.
Much less effort, however, is put into determining whether total compensation is commensurate with the value of services rendered.
We examine the issue and explain how such a calculation might be performed. We ask:
* How much value creation should be attributable to the efforts of the CEO?
* What percentage of this value should be fairly offered as compensation?
* Can the board actually perform this calculation? If not, how does it make rational decisions about pay levels?
Read the attached Closer Look and let us know what you think!
The record of mergers and acquisitions have not been impressive all over the world. Most of these deals fail or are unable to achieve its projected growth and targets. The most common reason responsible for the failure of M&A deals are the cultural differences in the organisations. This paper discusses the reasons why most M&A deals fail with help of 2 examples.
Ford financial crisis which has escalated over the last few years has been mainly triggered by the executive bureaucracy and royal hierarchy which is fashioned to the Ford family ties, the new appointed chief executive Alan R. Mulally articulates that the working atmosphere in this organization is very reclusive, information and communication among production stage shop floor taskforce is prohibited, this fact rationalize the employees making errors and been unable to correct them which has led to the corporation loss of $1.2 billion dollars. This fact has led to Ford degeneration to symbol of inefficiency, projected y the fact that the executive are reluctant making the culture of this organization to be dysfunctional and defeatist conflicting resulting to losing to the new Cerberus Chrysler management in sales as voiced by Kiley (2007). The case study evaluates three question that are aligned with the organization atmosphere, centrally emphasizing on fords main flaws which have degenerated to dysfunctional conflict, the role that the new chief executive Mulally has patterned to combat this conflict and will analyzed Mulally intervention of the incident involving Consumer Reports staff and two senior Ford engineers.
Cisco is a company that has grown through acquisitions. A look at the strategy they employ to acquire various company and post merger analysis along with the flaws.
Pay-per-use LAN and Wi-Fi network infrastructure is available to help your business :
- Pay only for what is used (AND no capital investment is required)
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And don't miss slide 11...on the 10 differences from other offers.
The EPA is investigating VW for installing software that enabled its vehicles to cheat emissions tests and later emit 40 times more pollution than allowed.
Organizational culture has a powerful effect on the performance and the long-term effectiveness of organizations. Organizational culture has the power to influence employee behaviors and increase employee commitment and productivity. Therefore, a clear understanding of organizational culture and how to effect its change is important for business leaders because it influences the way that organizations react to the changing demands of the business environment. The goal of this paper is to explore what is meant by organizational culture, why it is important, and how to change an established culture so that it is better aligned with the organization’s strategy.
Bruce M. TharpORGANIZATIONAL CULTURE WHITE PAPERFour O.docxhartrobert670
Bruce M. Tharp
ORGANIZATIONAL CULTURE WHITE PAPER
Four Organizational Culture Types
04.09
2
ORGANIZATIONAL CULTURE
Through decades of empirical research, scholars have
established abundant links between organizational
culture and organizational performance. While
previously businesses were either unaware of culture’s
importance or believed it too difficult to manage, today
they recognize that it can be used for competitive
advantage. This is something that Apple Computer
gets. By leveraging their culture of innovation toward
product as well as internal processes, they have been
able to survive — despite incredible competition —
as well as venture into new and profitable markets. But
in order to use culture strategically, a company first
needs to understand its culture. And there’s the rub.
Culture is a complex issue that essentially includes all
of a group’s shared values, attitudes, beliefs, assump-
tions, artifacts, and behaviors. Culture is broad —
encompassing all aspects of its internal and external
relationships—and culture is deep in that it guides
individual actions even to the extent that members
are not even aware they are influenced by it. Scholars
tend to agree that the root of any organization’s
culture is grounded in a rich set of assumptions about
the nature of the world and human relationships.
For example, the underlying belief that people are
selfish and only out for themselves might unwittingly
influence a company’s attitudes and behaviors toward
outside salespeople, vendors, and consultants. This
is profound stuff that is largely invisible, unspoken,
and unknown to an organization’s members. So
is it possible to really know a company’s culture?
While admittedly it would be a daunting (and some
might claim impossible) task to fully account for all
components of a company’s culture, the dominant
attributes can generally be identified. In focusing on
“effective organizations”, research has uncovered many
critical dimensions. John Campbell (1974) and his
fellow researchers identified thirty–nine impor-
tant indicators. While such a list is helpful, it is still
impractical for organizations to account for so many
dimensions. Realizing this, Robert Quinn and John
Rohrbaugh (1983) reviewed the results of many studies
on this topic and determined that two major dimensions
could account for such a broad range. Their Competing
Values Framework combines these two dimensions,
creating a 2x2 matrix with four clusters.
THE COMPETING VALUES FRAMEWORK
The first dimension places the values of flexibility,
discretion, and dynamism at one end of the scale with
stability, order, and control on the other. This means
that some organizations emphasize adaptation,
change, and organic processes (like most start-up
companies) while others are effective in emphasizing
stable, predictable, and mechanistic processes (like
NASA, Citigroup, and most universities).
Competing Values Framewor ...
FALL 2016 WORK & Society Discussion assignment SECTION A Part .docxssuser454af01
FALL 2016 WORK & Society Discussion assignment
SECTION A Part 1 of 2
You will discuss your recommendations for a change in organizational culture in one of two organizations: you have been assigned to discuss the Secret Service (SS) READ the
Secret Service article: http://www.nytimes.com/2015/01/15/us/politics/secret-service-reshuffling-follows-scandals.html?_r=0
Directions: Answer questions 1 & 2. Be specific paying particular attention to pp. 116 & 117 in the Schein article (below). Label answers 1&2 with SS on the subject line, as you are assigned.
1) Select a level of culture (either artifacts, espoused values or basic assumptions) and briefly describe how it is currently manifested in the organization. What should this level look like after a culture change?
2) Using either socialization by a dominant subculture or leader intervention, what steps should be used to change the culture? In other words, selecting one of these two methods, what would you recommendation happen to change the culture?
{pp. 116 & 117} of Schein Article (Organizational Culture by Edgar H. Schein
nsions have been made, and some preliminary support for the above hypotheses has been forthcoming (Feldman, 1976, 1988; G. R. Jones, 1986). Insofar as cultural evolution is a function of innovative and creative efforts on the part of new members, this line of investigation is especially important. Cultural Dynamics: Natural Evolution Every group and organization is an open system that exists in multiple environments. Changes in the environment will produce stresses and strains inside the group, forcing new learning and adaptation. At the same time, new members coming into the group will bring in new beliefs and assumptions that will influence currently held as- sumptions. To some degree, then, there is constant pres- sure on any given culture to evolve and grow. But just as individuals do not easily give up the elements of their identity or their defense mechanisms, so groups do not easily give up some of their basic underlying assumptions merely because external events or new members discon- firm them. An illustration of "forced" evolution can be seen in the case of the aerospace company that prided itself on its high level of trust in its employees, which was reflected in flexible working hours, systems of self-monitoring and self-control, and the absence of time clocks. When a number of other companies in the industry were discov- ered to have overcharged their government clients, the government legislated a system of controls for all of its contractors, forcing this company to install time clocks and other control mechanisms that undermined the cli- mate of trust that had been built up over 30 years. It remains to be seen whether the company's basic assump- tion that people can be trusted will gradually change or whether the company will find a way to discount the el- 116 February 1990 • American Psychologist
fects of an artifact that is in fundamental c ...
Leadership, Culture, Communication, and Diversity3Chapt.docxDIPESH30
Leadership, Culture,
Communication, and Diversity3
Chapter 3 Outline
3.1 Leading and Influencing Organizational
Culture
Dimensions of Organizational Culture
Different Types of Cultures
3.2 Competing Values Framework:
A Cultural Perspective
Adaptive Culture
Clan Culture
Achievement Culture
Bureaucratic Culture
Leading and Shaping Culture
3.3 Leadership and Strategic Communication
The Communication Process Defined
Newer Forms of Communication
How to Use the Communication Process
3.4 Leaders as Champions of Strategic
Communication
Create an Open Climate for Dialogue
Emphasize Strategic Topics
Focus on the Customer
Share Responsibility
Give and Receive Feedback
3.5 Leadership Skills in Persuasion
Four Steps of Persuasion
Four Traps that lead to Persuasion Failure
wei6626X_03_c03_p089-138.indd 89 8/5/11 8:45 AM
CHAPTER 3Leadership, Culture, Communication, and Diversity
The word culture can mean different things to different people: Perhaps it conjures up images of fine art, museums, and orchestras. Or perhaps it is the word you use to
describe the shared patterns, behaviors, and artifacts of a country, region, or society. In
fact, culture does have different “layers” that interact. For example, macrocultures include
national, religious, ethnic, and occupational cultures that exist globally; organizational
cultures exist in private, public, nonprofit, and government arenas; subcultures are found
in occupational groups within organizations; and microcultures exist within occupations
inside and outside organizations (Schein, 2010).
In this chapter, we focus on organizational culture before examining how culture more
generally—in terms of countries, nationalities, ethnicities, and so on—can have broad
implications for leadership efficacy and success. While the first two chapters laid the
foundation for understanding the nature of leadership, these final three chapters show
how leaders influence and shape organizations to achieve goals through communication,
strategy, and teamwork. We begin this discussion with organizational culture because
it shares a mutually dependent relationship with these three dimensions: An organiza-
tion’s culture affects how people communicate, how strategy is developed and imple-
mented, and how people work in teams. Culture can also be defined in terms of these
three dimensions. It is arguably the most important internal organizational dimension.
This chapter will also cover what is perhaps the more common usage of culture—interna-
tional cultures—and how different cultures and globalization present opportunities and
challenges for leadership. Since organizational and national cultures are influenced by
global trends—for example, technology innovations, mergers and acquisitions, influx of
international workers, and a mix of diverse values—leaders and followers must be able to
accommodate such changes in their organizations and teams. Understanding culture has
a substantial payoff ...
Chapter 5Cultural Approaches to Organizational Communication.docxketurahhazelhurst
Chapter 5:
Cultural Approaches to Organizational Communication
Introduction
Culture affects communication
Culture can create barriers that prevent us from understanding others
Ideologies and paradigms guide our thinking and impact our understanding of the world around us
Case Study: Avianca Flight 052
Avianca Flight 52 was flying from Columbia to New York
Due to poor weather, the flight had been repeatedly held up, leaving both pilots panicking about fuel levels
After Air Traffic Control again told them to wait, the pilots did not question the command
After running out of gas, the plane crashed, killing half of the passengers
What cultural dimensions may have influenced this event?
Defining Culture
The acquired learning of a group that gives its members a sense of who they are, of belonging, and works to make that group recognizably different from other groups
Organizational culture is very similar to traditional culture in that it provides a system of shared values, beliefs, and holds meaning to employees
Globalization and Culture
Globalization has a tremendous impact on the way we communicate between and within organizations
Geert Hofstede (2001) created a model of five dimensions that act as a broad framework for understanding the cultural differences between nations
Power distance
Individualism/collectivism
Uncertainty avoidance
Long-term vs. short-term orientation
Masculinity and femininity
Case Study: The New Job and Organizational Culture
Zeb served for five years as the branch manager of an established local bank
Zeb always adhered to the rules of operation that governed customer and employee expectations
Though satisfied with his job, Zeb took an opportunity to work at Google
Zeb was startled by the very different culture of Google’s expansive office complex, group lunches, opportunities for innovation and creativity, and flexible work hours
Why is a workplace like Google so appealing to many?
Organizational Culture
Defining organizational features of a company, that separates that company from others in terms of operations, employee relationships, and interorganizational behavior
Moving from one organization to another can prove difficult when the organizational cultures are vastly different
Substantial differences can cause culture shock in new employees
Work Environment
Characteristics of the work environment are dictated by organizational culture
Expectations of time
When does the business day begin and end?
How many hours and days of the week are expected?
Expectations for dress
What is appropriate for the workplace?
Expectations of communication behaviors
Southwest Airlines – fun and hard work
Critical Thinking Questions - Environment
What are the time expectations for your classes?
What are the dress expectations at your institution?
What are the behavioral expectations at your institution?
Organizational Commitment
Commitment to organizations is changing, as college students now average over ...
Entrepreneurial culture, profile of the leader and entrepreneurial orientatio...ijmvsc
Today, no company is safe from forces and pressures, which are exerted on it, because of a significant number of the requirements in particular as regards competitiveness, the need for change, or the crises, the deregulations and the cost of energy. To face this news gives, the company must reconsider its behaviors and its practices to renew itself, to open out and reinforce its international position in the market. Some of these practices form what one calls the entrepreneurial orientation.
For this reason, we will devote this paper for better encircling and apprehending the concept of entrepreneurial orientation and this, by focusing on its relation with the entrepreneurial culture and the profile of the leader in the specific case of the Tunisian companies.
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Understanding User Needs and Satisfying ThemAggregage
https://www.productmanagementtoday.com/frs/26903918/understanding-user-needs-and-satisfying-them
We know we want to create products which our customers find to be valuable. Whether we label it as customer-centric or product-led depends on how long we've been doing product management. There are three challenges we face when doing this. The obvious challenge is figuring out what our users need; the non-obvious challenges are in creating a shared understanding of those needs and in sensing if what we're doing is meeting those needs.
In this webinar, we won't focus on the research methods for discovering user-needs. We will focus on synthesis of the needs we discover, communication and alignment tools, and how we operationalize addressing those needs.
Industry expert Scott Sehlhorst will:
• Introduce a taxonomy for user goals with real world examples
• Present the Onion Diagram, a tool for contextualizing task-level goals
• Illustrate how customer journey maps capture activity-level and task-level goals
• Demonstrate the best approach to selection and prioritization of user-goals to address
• Highlight the crucial benchmarks, observable changes, in ensuring fulfillment of customer needs
Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
The world of search engine optimization (SEO) is buzzing with discussions after Google confirmed that around 2,500 leaked internal documents related to its Search feature are indeed authentic. The revelation has sparked significant concerns within the SEO community. The leaked documents were initially reported by SEO experts Rand Fishkin and Mike King, igniting widespread analysis and discourse. For More Info:- https://news.arihantwebtech.com/search-disrupted-googles-leaked-documents-rock-the-seo-world/
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Vat Registration is a legal obligation for businesses meeting the threshold requirement, helping companies avoid fines and ramifications. Contact now!
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Top mailing list providers in the USA.pptxJeremyPeirce1
Discover the top mailing list providers in the USA, offering targeted lists, segmentation, and analytics to optimize your marketing campaigns and drive engagement.
Building Your Employer Brand with Social MediaLuanWise
Presented at The Global HR Summit, 6th June 2024
In this keynote, Luan Wise will provide invaluable insights to elevate your employer brand on social media platforms including LinkedIn, Facebook, Instagram, X (formerly Twitter) and TikTok. You'll learn how compelling content can authentically showcase your company culture, values, and employee experiences to support your talent acquisition and retention objectives. Additionally, you'll understand the power of employee advocacy to amplify reach and engagement – helping to position your organization as an employer of choice in today's competitive talent landscape.
An introduction to the cryptocurrency investment platform Binance Savings.Any kyc Account
Learn how to use Binance Savings to expand your bitcoin holdings. Discover how to maximize your earnings on one of the most reliable cryptocurrency exchange platforms, as well as how to earn interest on your cryptocurrency holdings and the various savings choices available.
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Discover the innovative and creative projects that highlight my journey throu...dylandmeas
Discover the innovative and creative projects that highlight my journey through Full Sail University. Below, you’ll find a collection of my work showcasing my skills and expertise in digital marketing, event planning, and media production.
Event Report - SAP Sapphire 2024 Orlando - lots of innovation and old challengesHolger Mueller
Holger Mueller of Constellation Research shares his key takeaways from SAP's Sapphire confernece, held in Orlando, June 3rd till 5th 2024, in the Orange Convention Center.
3. 1. ABSTRUCT
We use laboratory experiments to explore merger failure due
to conflicting organizational cultures.
we introduce a laboratory paradigm for studying
organizational culture that captures several key elements of
the phenomenon.
In our experiments, we allow subjects in “firms” to develop
a culture, and then merge two firms.
As expected performance decreases following the merging
of two laboratory firms.
In addition, subjects overestimate the performance of the
merged firm and attribute the decrease in performance
members of the other firm rather then to situational
difficulties created by conflicting culture.
4. 2. INTRODUCTION
A majority of corporate mergers fail. Failure occurs on
average in every sense, acquiring firm stock prices tend to
slightly fall when mergers are announced.
Many acquired companies are later sold off and
profitability of the acquired firm is lower after the merger
Participants report a lot of conflict during the merger
resulting in high turnover (Buono et al 1985,walsh)
In (1988) Participants express that merger failure is at odds
with the public and media perceptions that mergers are
grand things that are almost sure to create enormous
business synergies that are good for
employees, stockholders, and consumers.
5. Example
This examples may help illustrate our ideas about cultural
conflict in mergers.
Daimler-Chrysler, both firms were performing quite well
(Chrysler was the most profitable American automakers)(cook 1998).
People in both organizations expected that their “merger of
equals” would allow each unit to benefit from the other’s
strengths and capabilities.
Performance after the merger, however, was entirely
different, particularly at the Chrysler division, in the months
following the merger the stock price fell by roughly one half
since the immediate post-merger high.
The Chrysler division, which had been profitable prior to the
merger, began losing money shortly afterwards and was
expected to continue to do so for several years (CNN
Money, February 26, 2001)
6. Reasons of failures
Differences in culture between the two organizations were
largely responsible for this failure (Vlasic and Stertz 2000).
Operations and management were not successfully
integrated as “equals” because of the entirely different ways
in which the Germans and Americans operated.
While Daimler-Benz’s culture stressed a more formal and
structured management style, while Chrysler favored a
more relaxed, freewheeling style (to which it owed a large
Daimler’s attempts to take over the entire organization and
impose their culture on the whole firm.
7. Role of cultural conflict
Cultural conflict often plays a large role in producing
merger failure but it is neglected when the benefits of a
potential merger are examined.
Synergies, costs, competitor reaction are some possible
determinants of success or failure for merger.
AOL-Time Warner deal, a front-page Wall street journal article (Murray et al.
2000)
8. Our Paper
This paper introduces a simple experimental paradigm to
explore cultural conflict as a possible cause of merger failure.
The guiding hypothesis is that an important component of
failure is conflict between the merging firms cultural
conventions for taking action, and an underestimation by
merger partners of how serve, important, and persistent
conflict are.
when joined firms differ in their conventions, this can create a
source of conflict and misunderstanding that prevents the
merged firm from realizing economic efficiency.
9. Observer Focus
We hypothesize that the extent of these conflicts are
unexpected because mostly observers focus on…
Tangible aspects of firms practices such as
technology, capital, and labor costs
Ignore aspects that are more difficult to measure such as
culture
This leads to overestimation of the value of a merged firm
at the time of the merger.
10. Our Focus
Cultural conflict is not meant that other potential causes
of merger failure are not important. Certainly, agency
problems, optimism, conflicts of interest and hubris
may lead top manages to undertake mergers that are bad
for shared holders.
We recognize these are potential sources of merger failure
but our focus is on one specific cause, that is
“Differences in culture may simply make it difficult for
members of the merged organization to see things in the
same way”
11. Our paradigm
Our paradigm also allows us to explore the development
of a specific form of tacit knowledge in group’s which we
use as a metaphor tor culture.
The experiments we report in this paper specifically
explore what happens when two groups that have
independently developed this tacit shared knowledgewhich allows them to operate efficiently-need to combine
their knowledge and anticipate how difficult it will be to
do so.
12. 3.
ORGANIZATIONAL CULTRE
Organizational culture has received considerable attention
from organizational researchers, and substantially less
attention from economists.
Culture is important for any organization but it is difficult
to precisely measure and study. (Schein 1996, Marcoulides
and Heck 1993, Rousseau 1990)
13. How to develop Culture
Culture is developed in an organization through joint
experience, usually over long periods of time.
It is useful because it allows an organizations member to
coordinate activity.
Language- in the form of codes, symbols, anecdotes, and
rules about appropriate statements plays and important
role in organizational culture.
14. Approaches
Researchers have relied on a few different approaches to study
culture in organizations.
1. Much of this research is “Ethnographic Observation” of
interactions in small numbers of organizations.
The small sample involved in this type of analysis, usually make
it difficult to draw firm conclusions.
2. Another approach consists of Questionnaires administered to
large numbers of members of a few organizations
The questionnaires mostly designed to measure important elements
of culture
Compared to draw across firms conclusions
1.
2.
How they differ in culture
How culture affects organizational performance
These studies are useful in that they provide concrete empirical
measures of differences between firms and several dimensions
related to culture.
15. Culture studied by Researchers
Kreps (1990) Argues that culture presents organizations with a solution to
problems resulting from multiple equilibrium in which there may be
uncertainty about the appropriate behavior.
Hermalin (2001) summarizes the economic approach to culture and presents a
formal model in which culture is an efficiency improving asset.
Arrow (1974) discusses culture as “codes” developed by organizations to help
coordinate activity and points our that these codes are path dependent and
may, therefore, differ greatly between firms, even though each is efficient .
Cremer’s (1993) defines culture as the part of the stock of knowledge that is
shared by a substantial portion of the employees of the firm.
In Cremer’s Model organization must respond to outside messages in a
coordinated manner, and this is less costly to accomplish when the stock of
shared knowledge is greater because of less time needed for communication.
17. 4.
ORGANIZAITON CULTURE AND MERGER
FAILURE
Most studies simply document success or failure of
mergers, without directly addressing differences in culture
(Ravens craft and Scherer 1987, 1989)
Some studies examine that effects on post merger
profitability of product and resource relatedness (Singh and
Montgomery 1987)
Most evidence suggests that mergers more successful
when merging firms make related products.
18. Existing studies
Existing studies provide support for the hypothesis
that cultural integration plays an important role in
mergers, the causal effects are not clearly
determined.
This is not because of a flaw in the way the
research was conducted, but due to problems that
frequently arise when working with real world
data.
19. Continue…
For instance, in the studies relying on survey
responses from employees in the merged firm, these
problems include possible response
bias, survivorship bias, only people who stuck
with a merged firm may return
questionnaires, respondent memory etc.
Our goal is to highlight how difficult it is to have an
ideal field study and , hence, how helpful some
exploratory experiments might be as a complement
to these kinds of studies.
20. 5.
CULTURE IN OUR EXPERIMENTS
Our Experiments can be seen as ways of creating these focal
principles and codes in the laboratory, and then measuring their
empirical consequences.
Taken together previous work on organizational culture points to
a couple of key elements.
One is shared understanding among organization members, which
usually comes about through shared experience.
Organizational researchers and economist also agree that this
shared understanding is helpful because is allows member of a
firm to successfully coordinate activity.
Our implementation of culture in the laboratory-similar in many
ways to Arrow’s (1974) and Cremer’s (1993) definition-includes there
elements
“Therefore allows us to study culture empirically in a controlled
and novel way”.
21. Experiment
In our experiments, culture is a specialized home made
languages a pair develops to solve a task. In the
task, two subjects with the same set of pictures have
to learn to jointly identify a subset of the entire set to
pictures.
To do this, they must develop tacit shared
knowledge, creating a common easy to quickly
describe the pictures so that a “merger” subject can
guide the “employee” to pick the pre specified subset.
Two pairs of subject or firms separately develop
cultures, and then the two pairs are “merged”
22. Continue….
One manager must then describe pictures simultaneously
to two employees, because the manager previously
participated only with one of the two employees, we
anticipate that the conflict in homemade languages will
make it difficult for the manager to get the new employee
to pick the correct pictures, and will also slow down the
old employee.
We, there fore, expect that performance post-merger
will be significantly affected by the difference in
languages.
23. Expected results
We expect that performance post-merger will be
significantly affected by the difference in languages.
The difficulty of cultural integration is well known.
Therefore the expected result are “That differences in the
languages leads to lower performance should not be
surprising”.
24. Continue…
The more interesting question-given our hypothesis that
participants in a merger typically focus on the gains to be
obtained (because of synergies technology, and so forth)
and neglect potential cultural integrations difficulties.
25. Explore
We predict that merger failure will occur if the culture
each pair develops is path dependent and idiosyncratic.
Even if the two firms efficiently perform in the
premerger period because of their concise languages, if
their languages are different, then post-merger
communication amount all parties will be difficult.
26. Continue…
After a merger, it will take some time to either “train” the
new employee to understand the acquiring the acquiring
firms language or to develop a new language shared by all
members of the organization.
We also explore with the merger process is how this tacit
shared knowledge is transferred between two groups.
28. 6.
METHODS
The task in our experiments is based on studies by Clark
and Wilkes –Gibbs (1986) and Schober and Clark (1989)
to address how shared meaning arises in languages.
In experiments, every subject is presented with the same
set of 16 pictures depicting office environments. While
most of the pictures share some common elementspeople furniture, room characteristics, and so forth- each
picture is unique.
Among the aspects that vary are the number of people
and their characteristics (gender, clothing, and ethnicity)
physical aspects of the room (high, ceiling, objects on
walls, furniture) and the actions of the people
(conversing with others in the picture, talking on the
telephone, working at a computer).
29. In every round of the experiment, the experimenter
indicated 8 of the 16 pictures in a specific order to
one subject, in the role of manager.
The employee had to select the correct 8 pictures. In
the same order as indicated by the experimenter to
the manager.
30. 7.
RESULTS
Example 2
In example One pair of student subjects began referring
to a picture as “UDAY RAO” because a person in the
picture resembled a professor by that name who taught a
class both students were taking the idiosyncrasy enables
a pair to become extremely efficient (cf. Arrow 1974) but
idiosyncrasy also makes it more difficult to combine two
pairs and create a common language.
In the example, when the new employee was brought
in, he had no idea who Uday Rao is, so it took extra time
to back track and find a different way to describe that
picture.
31. Continue…
The average completion time for the first 5 rounds after
the merger is 111seconds, and the average differences of
59 is significantly difference from 0 (p>0.001) t10=6.19
In round 6 to 10 after the merger, the average completion
time is 61 seconds, and the average difference between
these rounds and the last 5 premerger rounds of 9
seconds is significant at the p>0.05 level in a one –tailed
test (t10=1.83). Therefore, using the session/merger as
the unit of analysis, we see that the performance of the
post-merger firm is significantly lower than of the two
premerger firms.
32. Continue…
RESULT’S AFTER MERGER
ROUNDS
AVG. EXP TIEM
DIFFERENCE
SPSS REUSLTS
1 to 5
111 Seconds
---
P<0.001
t10=8.00
6 to 10
61 Seconds
59 Seconds
P<0.001
t10=6.19
15 to 20
52 Seconds
9 Seconds
P<0.05
t10=1.83
33. 8.
CONCLUSION
Our experiments supports both hypotheses
1. Differences in culture between our laboratory firms
lead to consistent decreased performance for both
employees after the merger, and subjects under
predicted the extent of this decrease.
2. We also find evidence of conflict and mistaken
blame arising from the differences in
culture, pointing to a possible source for the high
turnover rate following real merger.
34. Solutions
If we can produce reliable problems with post
merger integration, then we can also test possible
solutions.
For improving post merger integration is to create a
new task on which employees from both the
acquiring and acquired firm work together.
By using a new task, the employees are inhibited
from using the full extent of their culture that is
familiar form old tasks and able to compromise on a
new shared way for doing things.