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1. EXTERNAL AND INTERNAL
ORGANIZATIONAL ENVIRONMENTS
AND CORPORATE CULTURE
Chapter 4

2. LEARNING OUTCOMES:
• Understand the external environment of organizations
• Understand the internal environment of organizations
• Understand corporate culture and hiring fit for culture

3. THE ORGANIZATION'S
EXTERNAL ENVIRONMENT

4. SPORTS
AUTHORITY

5. Macro Forces and Environments

6. The External
Environment
To succeed and thrive,
organizations must adapt,
exploit, and fit with the forces
in their external environments.
External Environment involves all outside
factors and influences that impact the
operation of a business that an organization
must respond or react to in order to
maintain its flow of operations.

7. Macro Forces and Environments

8. COMPANY INDUSTRY FIT

9. MECHANISTIC AND ORGANIC ORGANIZATIONS

10. ORGANIZATIONAL
Designs and structures

11. Organizational
Structures
“Why has organizational design zoomed to the top
of the list as the most important trend in the Global
Human Capital Trends survey for two years in a
row?”
“The answer is simple: The way high-performing
organizations operate today is radically different
from how they operated 10 years ago. Yet many
other organizations continue to operate according
to industrial-age models that are 100 years old or

12. EVOLUTION OF ORGANIZATIONAL STRUCTURE

14. FUNCTIONAL STRUCTURE
(earliest and most used organizational structure)
(organized by department and area of expertise)

15. DIVISIONAL STRUCTURE
(organized by specific products or services, specific enough to warrant their own division of management)

16. GEOGRAPHIC STRUCTURE
(organized by regions or locations)

17. MATRIX STRUCTURE
(used to distribute resources and workers across multiple operations)

18. NETWORKED TEAM STRUCTURE
(naturally forms based on operations)

19. VIRTUAL STRUCTURE
(lots of variations to this boundaryless organizational structure)

20. THE INTERNAL ORGANIZATION
and
external environments

21. INTERNAL ORGANIZATION

22. CORPORATE
CULTURE TONE AT THE TOP
• Culture is both the personality and glue that binds an
organization.
• Framed and influenced by the top-level leader or
founder. Leader's vision, values, and mission set the
“tone at the top,”
• Influences both the ethics and legal foundations,
modeling how other officers and employees work and
behave.
ORGANIZATIONAL CULTURE
is considered one of the most important internal
dimensions of an organization’s effectiveness criteria.

23. THE MCKINSEY MODEL

24. 72%
HIGHER EMPLOYEE
ENGAGEMENT
Companies with winning
organizational cultures have
Engaged business units enjoy a
22% increase in profitability.

25. "Proof That Positive Work Cultures
Are More Productive"
Harvard Business Review
A cut-throat, high-pressure,
take-no-prisoners culture
Vs.
A positive and healthy
workplace culture

26. "Proof That Positive Work Cultures
Are More Productive"
Harvard Business Review
When organizations develop positive, virtuous cultures
they achieve significantly higher levels of organizational
effectiveness
— including financial performance,
customer satisfaction,
productivity, and employee engagement.

27. "Proof That Positive Work Cultures
Are More Productive"
Six essential characteristics for creating a positive culture:
• Caring for, being interested in, and maintaining responsibility for
colleagues as friends.
• Providing support for one another, including offering kindness
and compassion when others are struggling.
• Avoiding blame and forgive mistakes.
• Inspiring one another at work.
• Emphasizing the meaningfulness of the work.
• Treating one another with respect, gratitude, trust, and integrity.

28. “CORPORATE CULTURE:
THE CENTER OF STRONG ETHICS
AND COMPLIANCE”
Wall Street Journal

29. “CORPORATE CULTURE:
THE CENTER OF STRONG ETHICS
AND COMPLIANCE”
Wall Street Journal
Strong cultures have two elements:
A high level of agreement about what is valued
and
a high level of intensity with regard to those values