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Organization culture
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- 2. “An organization’s capacity toexecute its strategy depends on its “hard” infrastructure--its organization structure and systems--and on its “soft” infrastructure--its culture and norms.” Amar Bhide “Quote” www.seas9.com
- 3. What is OrganizationalClimate? Climate represents the beliefs about the "feel of the organization“. This feel is developed when members seek answers to the following questions: How well does the leader clarify the priorities and goals of the organization? What is expected of us? What is the system of recognition, rewards, and punishments in the organization? How competent are the leaders? Are leaders free to make decision? What will happen if I make a mistake? www.seas9.com
- 4. What is OrganizationalCulture? Culture is a long-term, complex phenomenon, which represents the shared expectations and self-image of the organization; the mature values that create "tradition" or the "way we do things here;" the collective vision and common folklore that define the institution are a reflection of culture. Individual leaders, cannot easily create or change culture because culture is a part of the organization. But, everything one does as a leader will effect the climate of the organization. www.seas9.com
- 5. What Makes Upa Company’s Culture? • Beliefs about how business ought to be conducted • Values and principles of management • Work climate and atmosphere • Patterns of “how we do things around here” • Oft-told stories illustrating company’s values • Traditions • Ethical standards www.seas9.com
- 6. Where Does Corporate CultureCome From? • Founder or early leader • Influential individual or work group • Policies, vision, or strategies • Traditions, supervisory practices, employee attitudes • Organizational politics • Relationships with stakeholders • Social commitments www.seas9.com
- 7. How Is aCompany’s Culture Perpetuated? • Selecting new employees based on how well their personalities “fit” in • Systematic indoctrination of new employees • Senior employees’ reinforcement of core values • Story-telling of company legends • Ceremonies honoring employees who display cultural ideals • Visibly rewarding those who follow cultural norms www.seas9.com
- 8. Culture and StrategyExecution: Ally or Obstacle? • Culture can contribute to -- or hinder -- successful strategy execution • Requirements for successful strategy execution may -- or may not -- be compatible with culture • A close match between culture and strategy promotes effective strategy execution www.seas9.com
- 9. Why Culture Matters:Benefits of a Good Culture-Strategy Fit • Strategy-supportive cultures – Shape mood and temperament of the work force, positively affecting organizational energy, work habits, and operating practices – Provide standards, values, informal rules and peer pressures that nurture and motivate people to do their jobs in ways that promote good strategy execution – Strengthen employee identification with the company, its performance targets, and strategy www.seas9.com
- 10. • Strategy-supportive cultures –Stimulate people to take on the challenge of realizing the company’s vision, do their jobs competently and with enthusiasm, and collaborate with others to execute the strategy – Optimal condition: A work environment that • Promotes can do attitudes • Accepts change • Breeds needed capabilities Why Culture Matters: Benefits of a Good Culture-Strategy Fit (continued) Can Do! www.seas9.com
- 11. Types of CorporateCultures Strong vs. Weak Cultures Unhealthy Cultures Adaptive Cultures www.seas9.com
- 12. Characteristics of Strong CultureCompanies • Conduct business according to a clear, widely-understood philosophy • Management spends considerable time communicating and reinforcing values • Values are widely shared and deeply rooted • Careful screening/selection of new employees to be sure they will “fit in” • Visible rewards for those following norms; penalties for those who don’t www.seas9.com
- 13. Values Customers Employees Shareholders How Does aCulture Come to Be Strong? • Leader who establishes values consistent with – Customer needs – Competitive conditions – Strategic requirements • A deep, abiding commitment to espoused values and business philosophy – Practicing what is preached! • Genuine concern for well-being of – Customers – Employees – Shareholders www.seas9.com
- 14. Characteristics of Weak CultureCompanies • Many subcultures • Few values and norms widely shared • Few strong traditions • Little cohesion among the departments • Weak employee allegiance to company’s vision and strategy • No strong sense of company identity www.seas9.com
- 15. Characteristics of Unhealthyor Low Performance Cultures • Politicized internal environment • Hostility to change – Experimentation and efforts to alter status quo discouraged – Avoid risks and don’t screw up • Promotion of managers more concerned about process and details than results • Aversion to look outside for superior practices – Must-be-invented here syndrome Avoid risks! www.seas9.com
- 16. Hallmarks of AdaptiveCultures • Introduction of new strategies to achieve superior performance • Strategic agility and fast response to new conditions • Risk-taking, experimentation, and innovation to satisfy stakeholders • Proactive approaches to implement workable solutions • Entrepreneurship encouraged and rewarded • Top managers exhibit genuine concern for customers, employees, shareholders, suppliers www.seas9.com
- 17. • Incorporate valuesstatement and ethics code in employee training programs • Screen out applicants who do not exhibit compatible character traits • Communicate the values and ethics code to all employees • Management involvement and oversight • Strong endorsement by CEO • Word-of-mouth indoctrination Instilling Values and Ethics in the Culture www.seas9.com
- 18. Building a Spiritof High Performance into the Culture • Emphasize achievement and excellence • Promote a results-oriented culture • Pursue practices to inspire people to excel • Desired outcome – Produce extraordinary results with ordinary people www.seas9.com
- 19. Approaches to Buildinga Spirit of High Performance • Treat employees with dignity and respect • Train each employee thoroughly • Encourage employees to use initiative • Set clear performance standards • Use rewards and punishment to enforce high-performance standards • Hold managers responsible for employee development • Grant employees autonomy to contribute • Make champions out of people who excel www.seas9.com
- 20. People Management PracticesThat Promote a Spirit of High Performance • Belief in the worth of the individual • Strong commitment to – Job security – Promotion from within • Managerial practices that encourage employees to exercise individual initiative and creativity • Pride in doing the “itty-bitty, teeny-tiny things” right www.seas9.com
- 21. Features of theCorporate Culture at Wal-Mart • Dedication to customer satisfaction • Zealous pursuit of low costs • Belief in treating employees as partners • Ritualistic Saturday morning meetings • Executive commitment to – Visit stores – Talk to customers – Solicit employees’ suggestions www.seas9.com
- 22. • Hard-driving, results-orientedatmosphere prevails – All businesses are held to a standard of being #1 or #2 in their industries as well as achieving good business results • Concept of boundary less organization exists • Reliance upon “workout sessions” to identify, debate, and resolve “burning issues” • Commitment to Six Sigma Quality • Globalization of the company Features of the Corporate Culture at General Electric www.seas9.com
- 23. Semco Corporation! AUnique Culture Latin America’s fastest growing organization, which successfully defied an inflation up to 900% per annum. Acknowledged to be one of the best companies around the world of it’s size. Has a History of just 12 years under current management style, and has a backlog of more than 16,000 applications from people who wish to work with Semco. In 12 years, the company went from a small sized conventional family owned concern to a diversified and dynamic workplace. Executives from organizations like IBM, GM, Yashica, Bayer, Nestle, Siemens, Dow Chemicals, Ford and Merck which themselves are termed as excellent companies visit Semco quite regularly to learn about this unbelievable company! www.seas9.com
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