Paradoxical Nature Of Organizational Culture, As Incorporating Elements Of Both Stability And Change - Essay Example

?Paradoxical nature of organizational culture, as incorporating elements of both stability and change “Interpretive social science sees paradoxes as - a part of - a meaning system that people use in order to give sense to their social world and to make it possible to interact in specific contexts” Teunissen, 1996: 23 Introduction Organizational complexity and ambiguity is accentuated with the existence of paradoxes, as is observed historically, by management researchers and scholars. These paradoxes, according to popular opinion are a consequence of socially constructed management discourses, whereby concepts such as change and flexibility, centralization and decentralization, flexibility and control etc., tend to co-exist, and at times, encouraged and perceived as inevitable elements for organizational success. For the purpose of this study, the predominant and widely recognized organizational paradox of change and stability, will be discussed at length. Change and flexibility, with regard to organizational environment, are perceived as two of the most inherent and crucial tools of achieving organizational growth and success. Companies, all over the world, constantly use these elements to drive their organizations towards growth and ensure long-term sustainability in the marketplace, particularly in situations whereby the external environment is characterized by strong competition or when the companies are caught in the midst of a crisis. This paper aims to discuss the paradoxical nature of organizational culture, with regard to incorporating the widely popular albeit highly contradictory elements of change and stability. In a bid to assess this paradox, a comprehensive literature review, assessing and analyzing the same, is included followed by a case study and analysis of the same. The paper ultimately concludes with the general observations made and conclusions arrived at, after a careful study of the same. Brief Background/ Overview: Contemporary organizations are required to devise fast paced strategies, to deal with the constantly changing industry demands and consumer preferences, in order to attain stability and prevent their firms from losing their competitive standing in the industry. It is on account of this very reason that, managers today, encourage continuous innovation, improvement and change within organizations in order to address the challenges posed by the economic environment. The management is faced with the persistent challenge of adapting to the continuous innovations taking place in the external environment and devise and implement appropriate change management policies within their organizations, accordingly. It is on account of this very reason that various authors and researchers have concluded that change takes precedence over stability in contemporary corporate environment (Daft, 2010). It is a widely established fact that in order to survive in this highly dynamic corporate environment, the firms are required to include elements of innovation, flexibility as well as change from time to time. However, at the same time, they are also required to ensure stability and reliability (Farjoun 2010). The existence of this duality of change and stability, is one of the most widely popular and essential paradoxes in the field of organizational management (March & Simon, 1958; Thompson, 1967; Weick, 1979) which has received widespread attention and recognition in the field of management research, over the years (Farjoun, 2010; Gupta, Smith & Shalley, 2006; Leana & Barry, 2000; Lok, 2006; Nelson & Winter: 1982; Schultze & Stabell, 2004; Smith & Lewis, 2011). Literature review There is a high level of awareness within the field of management, regarding the existence of paradoxes ultimately leading to a rise in complexity and ambiguity (Farson, 1996; Handy, 1994; O’Connor, 1995). Most of these terms are widely popular and predominant in changing organizations wherein change is given crucial significance (Lewis, 2000). Van de Ven and Poole (1988), hence, making the concept of organizational change, inherently paradoxical in nature. The term paradox has been described as the concurrent presence existence of apparently reciprocal and exclusive factors such as market demands, consumer preferences, as well as management perspectives and ideas (Handy, 1994). There are various forms and types of paradoxes within an organizational environment. Handy (1994) states that some of the most crucial paradoxes found within organizations are those that involve high level of complexity; tend to challenge formal logic; and play a key role in influencing management decision making processes. According to Smith and Berg (1987) organizational paradoxes often tend to paralyze the certain managerial processes, cause emotional distress among the staff, and add to the struggles and conflicting of interests among the management team. Apker (2003) states that organizational members often tend to engage in, and exhibit contradictory predispositions with regard to their everyday communications in a bid to achieve change and incorporate it successfully across various levels of their organizations. Implementing paradoxical ideologies within organizational strategies is one of the most inherent aspects of changing organizations since it tends to evade and lessen the complexities associated with resisting change (Lewis, 2000). Research has indicated that the experiencing of paradoxical situations and elements helps the management, at times, to address the challenging situations they are faced with, in the event of change, and guide them in understanding the external environment in a better manner. This understanding in turn, helps the management in effectively implementing change and hope for achieving stability in the long-term (Van de Ven and Poole 1988; Dauphinais, 1996; Bartunek, 1988; Ford and Backoff, 1988; Weick, 1996). The process of change within organizations results in increase in complexity and disrupts the stability of the organization for a short-term, however in the long-run, it helps the management to cope with the external demands of the marketplace; increase their potential to respond to changing practices in the industry; and train their staff to deal with the changed demands in an effective manner. The management is required to cope with various issues ranging from financial and economic to managerial and other routine day to day processes. Any change, regardless of its extent and scope, within any given department of an organization encourages and compels the management to implement the same, across different levels of the organizational hierarchy (Leana & Barry, 2000). The concepts of stability and change are as defined within organizational theories indicate two contradictory concepts which are in stark contrast with each other both in terms of nature as well as approach (Poole & Van de Ven, 1989; Farjoun, 2010). However despite its contradictory nature, both these terms have come to co-exist within an organizational environment, which is evident from the fact that the management routinely applies them to achieve organizational success (Farjoun, 2010). It is hence highly inevitable that these concepts have garnered much attention and recognition within management studies and has achieved a place of great significance, influencing the development of a range of theories and models (Daft, 2010) which are now widely applied by the management across the globe, in their pursuit of achieving overall organizational success and stability. Change is inevitable and various large and small organizations are now increasingly adapting and implementing change management strategies in order to sustain their competitive positioning in the industry. Hence it is evident that the top management is highly concerned with managing and influencing change, in order to strive for organizational stability, which in turn may lead to higher profitability and greater returns for the company. Thus companies today, are striving hard to implement change management techniques and amalgamate the same within their bureaucratic strategies, particularly in case of large organizations (Daft, 2010); and at the same time striving to maintain and establish control and stability to prevent deterioration of their competitive standing in the industry. The degree and extent of efforts put forward by organizations, indicate their approach to duality, to accommodate and co-ordinate two highly contradictory elements i.e., stability and change, in their corporate strategies (Storey & Salaman, 2009). Although conventional approaches to management dictates that such paradoxes be resolved, the increasing evidence based on management reviews, and extensive research conducted in this field, reveal that the existence of organizational paradoxes, such as the one discussed in this paper, in fact foster further creativity, innovation and change, and help the organizations in achieving stability and success (Stohl and Cheney, 2001; Westenholz, 1993). Theoretical perspectives: The stability-change dilemma: Change and stability are both vital elements for achieving organizational success. The process of change can hence be perceived as an inconvenient truth, which requires to be controlled and managed with great care, and effectiveness in order to achieve stability in organizational processes. According to Katz and Kahn (1966), organizations seek to attain stability by way of re-organizing organizational structures; modifying the reward mechanisms; as well as by readjusting the value systems currently in place, in a manner which helps them in achieving overall growth and success. Cultural theorists argue that these processes, sought to be changed by the management, in their bid to achieve stability, are inherent to the organizations and hence might be resistant to such planned changes, taking place within the organization. On the other hand, Kilduff and Dougherty (2000) state that organizations at times strive to maintain stability in order to achieve organizational success, and is viewed as a pre-condition to the survival and existence of their organizations in the highly competitive external environment. Case study: Change management at Chrysler Most of the companies who have managed to successfully steer their companies towards growth and stability have done so by implementing change management strategies. One such company, is Chrysler, which through its planned corporate strategy, proposed to change its organizational culture, in order to achieve stability, and was successful in its efforts to steer the company, which was on the verge of bankruptcy, towards profitability. Similar efforts were made by other prominent organizations such as the British Airways, AT & T, General Motors etc., to name a few. This study, however is particularly focused on discussing and analyzing the paradoxical organizational culture of change and stability, with regard to Chrysler Corporation. Contrary to popular belief, one of the key causes of organizational setbacks suffered by the management lies in the mismanagement of organizational culture and its overall social structure, as opposed to the top management, or staff. This is because, globalization has led to the expansion of international markets, whereby firms are now made to compete at a broader and larger platform, than never before. Firms today have branches all over the globe, and the culture and social structure of these international locations, differ significantly from one another. It is hence of utmost significance for the management to ensure that all its branches are managed and functioning effectively, in order to ensure organizational stability and success. Chrysler Corporation is one organization which is familiar with the process of change, and the impact of bringing about such change, on its profitability. The company, during the 1990s was faced with severe criticism regarding its customer care policies, and was facing several challenges with regard to managing stability, low profits and constantly mounting losses. The company was considered as a loser by its stockholders and it was generally accepted to be non-competitive due to its steady downfall (Mawhinney, 1993). However, it was only after the adoption of the Customer One program, that the company's strategic position began to change (Baumeister & Bushman, 2010; Holton, 1997). The immediate impact of this program was by far most impressive. The company, post the implementation of its cultural changes within its organizations, managed to achieve substantial reduction in its overhead costs amounting to approximately $4.2 billion in a period of less than four years; succeeded in quadrupling its stock prices; and completely reversed its position from going into bankruptcy to actually earning profits (Baumeister & Bushman, 2010). Furthermore as a part of their corporate strategy, and in sync with its change management policies, the company pledged to introduce new makes of care every year, and the company followed through, ensuring that the firm had a new product to offer to its customers each year. Great care was taken to ensure that these new products offered greatest comfort, excellent performance and greatest satisfaction to its customers (Needle, 2010). The Customer One dealer training program, implemented by Chrysler helped the management in regaining a major chunk of its lost customer base, and customer confidence in the company’s product. One of the key highlights of this program was the fact that it was aimed at ensuring greater customer satisfaction. Customer involvement in the program was ensured by designing and developing strategies that required customer inputs and this feedback was then utilized effectively by the management to overcome their drawbacks. Furthermore steps were taken to include inputs from workers as well as other staff as well, over and above the inputs collected from the customers. This strategy ensured that all aspects of quality control were taken into consideration and that the final product would be at par or better than the customer’s expectations (Rosenbloom, 1999). Analysis It is amply clear from the above discussions that achieving organization wide cultural change is a highly daunting task, and yet there are no guarantees with regard to the returns. The probability of deriving positive outcomes, from implementing change management strategies, is however directly dependent on the range and scope of change sought within and beyond the organizations; as well as the level of efforts made across all levels of the management. In order to ensure that the change management strategies bear fruit, it is of utmost significance to develop plans which seek co-ordination of all the departments within the organization, which in turn can be achieved by implementing effective and flawless communication channels. Furthermore depending on the level of changes sought and extent of damage caused to the organization, the changes must be implemented in various organizational departments. Chrysler for instance, initiated its change management strategies by completely revamping its engineering department, and introducing new models of cars every year. The next set of change was then implemented in improving the customer service departments whereby appropriate training was provided to the staff to serve the customers in a better and effective manner. The key challenge faced by organizations aiming for change and stability at the same time, such as Chrysler in this case, is to decide the time frame whereby change strategies can be halted momentarily and efforts can be initiated to stabilize the firm. These strategies in turn depend on the pace of change experienced by the organizations. In case of Chrysler, the key goal was to completely change its internal operations with a view to avoid further decline of the company towards bankruptcy and seek a complete turnaround by achieving decent profits. Thus the stability strategy at Chrysler started at the point where the change management strategy successfully posted profits; garnered positive customer response and hence greater customer satisfaction; and managed to attract a new customer- base. Stability sets in where change starts to take effect, and that is the key goal of companies in present times, particularly those dealing with dwindling profits and striving to attain stability through change management. Achieving change in organizational culture in order to achieve greater profitability is rapidly gaining widespread popularity, among organizations and is perceived as a lucrative alternative to maximize profits, in present times. Although there are various setbacks encountered during this method, the level of success ensured by implementing change strategies in organizational culture, warrants greater managerial attention. Needless to add, organizations today are becoming more and more conscious about the effectiveness of implementing change across all levels of their organizations in a bid to attain stability in the long run. The concept of duality or organizational paradox ensures that organizations are able to successfully adapt to the changes and achieve stability. Among all the other organizational paradoxes, the change-stability paradox has gained significant acceptability over the years. Conclusion: The review of literature and the case study indicates that the process of change management within organizations helps them in gaining profitability and that change is a continuous process which needs to be applied widely across all departments in order to gain stability. Organizations which show reluctance to change are known to suffer, as seen in the case of Chrysler, and eventually become too rigid, thus making it difficult for them to survive and sustain their stability in the highly dynamic corporate environment. Internal variation is a must, in order to avoid freezing of the companies’ internal social structures. Most organizations today, have risen up to this new challenge, are seen incorporating change management strategies, with a view to achieve long-term growth and stability. The key to achieve stability thus lies in accepting and implementing a culture of continuous change, and to exploit the key elements of this organizational paradox for the benefit of organizational goals. In conclusion, it can be safely stated form the above discussions and the extensive case study analysis and literature review, that organizations today must continually strive to implement change across all levels, in order to gain stability, and that the existence of such paradoxes, is what ensures organizational growth and success. References: Apker, J. (2003). “Sensemaking of Change in the Managed Care Era: a case of hospital based nurses”, Journal of Organizational Change Management, Vol 17 No 2, pp. 211-227. Bartunek, J.M. 1988. “The Dynamics of Personal and Organizational Reframing.”, in R.E Quinn & K.S Cameron (Eds.), Paradox and transformation: Toward a theory of change in organization and management, Ballinger, Cambridge, MA, pp. 137-162. Braumeister, R. F., Bushman, B. 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