The Relationship between Organizational Identification and Organizational Culture - Case Study Example

Organization structure and culture of Virgin Group Name Institution Course Date Introduction to Organizational culture The attitudes, ideas, values and practices of an organization are what we can term as the organizational culture. It is made up of the standards that individuals in a given organization shares and that determine the manner in which they relate to each other and also the company’s stakeholders. In a move to achieve the organizational objectives, the top level management of the organization may attempt to establish a corporate culture for the company over and above the culture existing internally amongst the employees, they (employees) posses their own interactions and norms that influence the organization as a whole (Cherrington, 1989). Organizational culture is the foundation competitiveness of businesses; as a result, organization culture is of outmost importance to the business. Every business can hardly survive in the absence of organization culture (Cherrington, 1989). Organization management is an upcoming economy which has been born from management philosophy due to the progressively more competitive market at the present time. The principle of survival of organizational culture is the use of the material, the cultural and the spiritual which means the staff material and spiritual needs have to be met (Dalglish & Miller, 2010). This can motivate the creativity and activities of the company’s employees. In a move to make the economic efficiency of an organization better, organization culture is an integral part of the company and is a crucial component of strategy management. The aim of this paper is to discuss the organization structure and culture of the Virgin Group and its effects to the organization. Overview of the Virgin Group The Virgin Group is among the leading successful business territory in the globe in recent days. The Group has stamped itself in different industries inclusive of retail, financial service, travel, mobile telephony and several others. Virgin is a major force in the British market and has grown globally in regions like Asia, North America, Australia and Africa. It started in 1970 as an ordinary mail-order merchant; Virgin has expanded to be a major successful business territory in the globe. The Group has invested in over 300 companies with more than 50,000 employees spread around in 30 countries. In 2009, their global revenue was in excess of US$18 billion (Virgin, n.d.). Most of the groups’ success story is credited on the founder’s and CEO philosophies and beliefs that are intensely entrenched in the Virgin Group’s organizational culture. This has played an important role in the expansion and success of organization in nowadays global competitive business Virgin Group of companies which was founded by Richard Branson is one of the leading business organizations in the globe. The organization has made a land mark in various different aspects in the business sector. The aim of this paper is to scrutinize the organizational culture and structure of the Virgin Group and its impact it has had on the organizational success in various different industries. Many people have the view that Virgin Group is a multinational which absolutely is not the truth. Each one of the 300 companies under Virgin Group operates on its own as a single entity and Richard Branson serves as chairman, public relations demagogue and shareholder. Majority of them are operational companies with their own assets, offer goods and services as well as employ people. These companies are controlled and owned by around twenty holding companies. The structure of Virgin Group is very complex; it can be referred to as both keiretsu as well as brand franchising operation (Grant, 2008). Nevertheless, according to its structure, it can be referred to as a corporate with a keiretsu structure. This is a structure in which it is a group of companies where each company owns shares in the other company within the consortium, in addition all the companies work as a team to advance the group’s objectives (Jones, Mills, Weatherbee, & Mills, 2006). Moreover, such a complex structured large organization requires being organic so as to be in a position to adapt to variations in its environment. According to Jones et al. (2006) organic structure encourage flexibility, as a result people instigate change and can become accustomed faster to varying conditions. Taking into consideration each and every individual companies and compare it to a department giving a distinctive service or product, it is apparent that they show departmentalization. The division of departments in an organization in relation to the products or services that they offer is referred to as departmentalization (Jones et al., 2006). For instance, Virgin records deals with music labels while Virgin mobile provides cellular services. Nevertheless, the Virgin Group structure is very complex such that it is essential for the consortium not to only to own a single style of departmentalization. For example, Virgin Mobile operates in various countries such as India, Australia and UK therefore there is a variation in the type of services offered in each country. This is evident that geographical departmentalization is exhibited by Virgin Mobile. According to Jones et al. (2006), the division of a company in relation to geographical location is known as geographical departmentalization. Depending on the customer’s base, the type of products and services also varies hence showing customer departmentalization. This is the division of a company in relation to the type of customers that they serve (Jones et al., 2006). In the view of the fact that Virgin Group has so many forms of departmentalization, the whole organization is understood to exhibit a hybrid structure. This is a blend of two or more forms of departmentalization. The above multi-divisional approach facilitates the Virgin Group to simply become accustomed to the technological, culture in addition to extra forces in the area it spreads out to (Dalglish & Miller, 2010). The Nature Organizational Culture at Virgin Group The major part of the culture of the Virgin Group is manipulated by the personal philosophies and beliefs of Richard Branson which is one of the reasons for the group’s success. The founder has high values for all his employees and assumes personal responsibility to make sure that his beliefs are implanted amongst all the employees. He has fashioned a decentralized formation in the organization through according authority to his employees to take decision hence reducing bureaucracy. The employees do not constantly have to pursue normal procedures and alternatively they are encouraged to reason on their own (Virgin, n.d). This culture has proved to be a success for the group. Most of the Groups’ culture is subjective to the founder’s personal belief and philosophy. As employees are crucial to his organization, so are the customers served by Virgin Group. The main reason why Virgin Group is capable of operating in a good manner, even with an informal structure is mainly due to its exceptional organizational structure. The Group’s culture is a true reflection of the Branson casual nature, commitment to his customers and employees, lack of respect for formal authority and hierarchy in addition to his belief in responsibility to hard work (Grant, 2008). This has a detrimental influence on each and every company within Virgin Group plus the corporate culture. It helps the Virgin Group to offer an atmosphere in which ambitious and talented individuals are motivated to strive and do their best in achieving a high level performance (Brooks, 2006). On the other hand, still in an informal atmosphere, commitment of high level, taking up personal responsibility in addition to long working hours when called for is expected. Performance enticements offered to Virgin Group employees are reticent but the Group gives other benefits such as weekends, getaways, impromptu parties and social activities. This kind of atmosphere creates a good relationship between the employees and the employer (Grant, 2008). The hierarchy and division of labor is an imperative aspect of a corporate structure. The control, number of levels in authority, plus the quantity of communication are very important aspects in the smooth running of an organization (Charnov & Montana, 2008). Virgin Group companies function as separate entities. The different entities form a part of the family as opposed to hierarchy. They have the power to conduct their own affairs, but the companies help each other, and solutions to stumbling blocks are over and over again found somewhere within the group (Virgin, n.d). Virgin Group is a commonwealth with common values, interests, goals and ideas. As discussed earlier above, the Virgin Group comprises of a flat hierarchical structure which allows fast and efficient decision making. This organizational culture has been one of the major reasons that have helped the consortium to develop into new business enterprises. The structure also permits an extensive span of control plus devolution. Span of control is simply the number of subsidiaries managed directly by a manager (Jones et al., 2006). The devolution structure of the consortium provides more power to the employees in times of decision making. Devolution is the transfer of authority to each and every level of the hierarchy (Jones et al., 2006). Branson has a belief that the employees are the spinal column of the organization and therefore imperative that they posses adequate involvement plus authority in judgment making (Charnov & Montana, 2008). Richard Branson as the founder of Virgin Group has given all his employees the mandate to make unendorsed decisions in relation to their perception without following the pecking order (Dalglish & Miller, 2010). This has installed more confidence to the employees and the management. In view of the fact that interaction amongst all levels of command is encouraged, it creates effective communication which is proven by the fact that Richard personally brushes shoulders with the employees on usual occasions discussing ideas and getting responses. Owing to the fact that Virgin Group is made up of so many businesses besides a decentralized structure, signs of bureaucracy should be evident. Nevertheless, Richard Branson has made sure from the word go to reduce bureaucracy to the lowest degree available as he works to flatten the hierarchy (Dalglish & Miller, 2010). Through Branson leadership, the employee’s efficiency has improved as he concentrates on self management and wide span of control. The founder’s uncertainty of corporate hierarchy plus a formal structure has paid a great role in the company cohesiveness to a higher height. The promotion of his unusual strategy as opposed to the formal business practices in addition to non-traditional organizational structuring may explain the Group’s break through (Charnov & Montana, 2008). The Groups’ distinctive culture has progressively grown to its state today. The Group is portrayed as a “family” giving its emphasis to the informal strong philosophy system and beliefs. Owning such a culture helps the Group to possess an effective control and coordination amongst its different departments (Brooks, 2006). Operating as a community as opposed to a corporation encourages the aptitude to effectively communicate within the various companies in the consortium. The Virgin Group works together as a whole based on the common set of values that constantly strengthened. This is paramount putting into consideration the gigantic size plus the organization’s complexity. Virgin group has at all times maintained the principal that employees are an integral part of the company and hence the need to be respected (Virgin, n.d.). The Group’s management takes care of the employee’s welfare and allows the employees to work in a liberated atmosphere and due to these beliefs, it has been possible for the organization to challenge, thrive and compete in innovative business prospects. Branson has been influential in the organization’s culture and has managed to implant his belief into his employees which has motivated them to work effortlessly to execute their mandate (Schrodt, 2002). A major strong point that primarily favors Virgin company it the Group’s non- traditional revolutionary even in the way it conducts its business. Virgin trusts in snatching opportunities. Differing to what most people may tend to think, the consortium expansion plus the diverse empire is not by chance or inattentive. Each and every successful business enterprise exhibits their commitment to selection of the perfect market and the perfect opportunity. This is beneficial to the consortium and is a major reason for their success (Virgin, n.d). Organizational culture is capable of resulting into group think. When the culture becomes so dominant, employer and employees may dish excellent ideas that appear to be against the organizational culture. Organizations without an open and flexible culture loose the competitive edge since they do not adopt market changes (Dalglish & Miller, 2010). The Virgin Group’s organizational culture is often seen as a stumbling block between employees of Virgin Group and other different organizations. This has a long term effect to employees that find themselves trying to implement the old culture in a new work environment and consequently are viewed as outsiders who are reluctant to adapt (Dalglish & Miller, 2010). The Virgin Group’s Organizational culture sometimes takes percolate into the personal life of employees. When the culture is aggressive and strong, it has an effect on how the individual intermingle with his family (Dalglish & Miller, 2010). Conclusion According to Cummings, et al (2005), Organization culture is founded on the manner in which individuals in an organization act and think. Each organization has a definite culture and relative to what the culture is, it is capable of either help or work against achieving the organizations’ objectives. The organizational culture may prove to be the difference between company‘s failure and success. Leaders should emphasize on development of their organization culture as they do to accomplishing routine perfection in marketing, operations, research and development and any other company discipline. The work environment in an organization is mainly determined by the top level leaders moving down to other employees down the line. Top levels managers can control the business climate and subcultures. These managers have a great effect on the employee’s commitment levels and they can also create a strong group culture that can have an influence in the whole organization environment (Daft, 1997). Organizational culture is an evolving process which moves with the management in position. Change within an organization occurs in projects that are designed to promote the overall performance of a company. The actions are project oriented which their main aim is to take care of the problems available or the organizational goals (Dalglish & Miller, 2010). In relation to the examination of Virgin Group’s culture and structure, it is proof that it is an extremely thriving organization mostly driven by the founder’s beliefs and values. Although many people believe that most of his management methods are unconventional, the methods have been beneficial to the founder and the Virgin Group has proved to be successful. If the consortium moves on strengthening their organizational culture and structure, it will grow from strength to strength to be among the successful organizations in the world for years and years. References Brooks, I. (2006). Organizational Behavior: Individuals, Groups and Organization. Essex: Pearson Education Limited. Cummings, et al (2005). Organization Development and Change, 8th Ed., Thomson South- Western, USA. Cherrington, D. J. (1989). Organizational behavior: The management of individual and organizational performance. Boston: Allyn and Bacon. Daft, Richard L. (1997). Organization Theory and Design. 6th ed. Cincinnati: South-Western. Dalglish, C. & Miller, P. (2010). Leadership: Understanding its global impact (1st ed.). Tilde University Press. Grant, R, M. (2008). Contemporary strategy analysis. 6th ed. Oxford: Blackwell Publishing. Jones.G. R, Mills. A. J, Weatherbee. T.G. & Mills. J. H, (2006). Organizational Theory, Design, and Change. Canadian Edition, Pearson Education: Canada. Montana. P. J, Charnov. H. B. (2008). Management. Barron's Educational Series, Hauppauge: New York. Schrodt, P. (2002). The relationship between organizational identification and organizational culture: Employee perceptions of culture and identification in a retail sales organization. Communication Studies, 53, 189-202. Virgin, retrieved 11th August 2014 from www. Virgin.com Read More