In Order to Have a Successful Organisation, the Most Important Thing for Management Is to Get Culture Right - Essay Example

? MANAGEMENT Essay Topic: ‘In order to have a successful organisation, the most important thing for management is to get culture right’. To what extent do you agree with this statement? How should managers address culture? (Word-counts: 2595) Your name …………………. College/ course…………….. Date of submission …………. Introduction Organizational Culture has emerged to be one of the most crucial factors that strongly influence the performance of an organization. In recent years, organizational culture has gained considerable attention from managers because of that it is extremely significant in relation to meeting the industry needs for greater effectiveness and the material and social needs of employees in order to create a constructive work-environment and foster high performance working. Organizations put efforts to develop ‘right kind of culture’, culture with quality’ or a culture of customer service’ and managers most often try to inculcate certain values in their organizations. There are widespread assumptions as better or worse cultures and stronger or weaker cultures and more importantly the ‘right’ kind of culture influence the effectiveness and success factors of the organization (Schein, 2004, p. 7). This piece of research paper presents a brief description on organizational culture and explains why managers try to get culture right in order to achieve organizational success and maintain sustainable competitive advantage. This paper also described how managers in today’s business environment address culture. Management perspectives of Organizational Culture Organizational culture is the system of shared actions, values and beliefs that are developed and established within an organization and this influence its members to guide and shape their behavior (Schermerhorn, Hunt and Osborn, 2005, p. 436). As McShane and Von Glinow (2004, p. 476) noted, organizational culture refers to a basic pattern of shared values, assumptions and beliefs that are considered to be the right way of thinking and acting on problems and opportunities facing the organization. According to them, organizational culture is the DNA of an organization because it is not only invisible to the naked eye but also a very powerful template or tool that can shape what happens within an organization. No individuals have same behavior and personality and likewise, organizations also have very different and unique culture, and therefore, organizational culture can also be termed as organization’s personality. People in any organization are considered to be the most valuable, powerful and high-valued assets and therefore utilizing these resources more effectively and strategically seems to be the underlying principle of organizational behaviour. People in an organization may belong to different cultures, social setting and life-style, but when the organization is able to create, design and establish a culture of its own by aligning and integrating the shared values among the people, the organization will also be able to be successful in achieving the goals. Do organizations require forming and structuring a specific culture and getting it right? If managers target better organizational performance, if they look at increased productivity of employees and thus to earn higher profitability, if they would like to achieve high performance working and they like to maintain sustainable competitive advantages, the answer to the above question is certainly ‘yes’. Especially in today’s competitive business environment, complex marketing contexts, complicated technological advancements and in times of globalized economies, managers need to identify the organizational culture, design and structure its features, understand its significances in terms of business opportunities and evaluate its benefits to the business as well. Smircich (1983, p. 344) described that organizations are social instruments that produce goods and services and thus they produce cultural artifacts like rituals, legends and ceremonies. The working-environment and circumstances within an organization would normally differ from one to the other and hence, the cultural aspects and sub-cultures within the organization also would differ from one to the other. An organization may be performance oriented, but the other may be employee-friendly (McShane and Von Glinow, 2004, 478). One may give emphasis on organizational-learning culture where as the other may give importance to customer-focus. An organization may be externally-adaptive whereas the other may be internally-integrated. But, it is very obvious that an organization that lacks a specific culture and is not successful in getting the right culture is less likely to succeed in achieving its marketing and business objectives. Culture and Success: Positively Correlated If culture and performance is positively related, the interrelation between culture and success also will be the same. It’s because, success of any organization depends solely on its performance, which can be measured and understood from the performance of the employees, technology and operation too. As McShane and Von Glinow (2004, p. 481) quoted, ‘culture is one of the most precious things that a company has and therefore the manager works harder on it than anything else’. Ogbonna and Harris (1998, p. 274) found that a very large numbers of literatures have premised on the key assumption that organization’s performance is very much dependant on the proper alignment of organizational values. The same opinion has been detailed in Ogbonna’s work (1992, p. 42) as well. As Hellriegel and Slocum argued, organizational culture and business performance are closely related. Many studies have outlined that organizational culture and high-performance working have been found to be positively related. Barney (1986, p. 656) also argued that organizations that have cultures with right attributes or managers who are getting cultures right were found to have obtained sustainable financial performance. In analysis of the culture and performance or culture and business success, the following attributes can be summarized: Organizational culture can have significant impact on firm’s long-term economic and financial performance, Organizational culture is an important factor that determines success or failure of a firm (2007, p. 432) When an organization has specific mission and vision relating to its culture, the same has been well communicated and its attributes are conveyed to its people and they are made aware of its significance to work-setting, it influences employee behavior as follows: By knowing organizational culture, employees will be able to understand both the firm’s history and current operation methods, Organizational culture has been found to foster commitment to corporate philosophy and values, It can be utilized as control mechanism to channel behaviors towards desired behavior and keep away from undesired behaviors, and Certain sub-cultures are found to be more directly related to greater effectiveness and productivity than some others (Hellriegel and Slocum, 2007, p. 432). Daft (2009, p. 387) argued that organizational culture plays pivotal role in creating an organizational climate that enables learning and innovative responses to varying challenges, competitive threats and newer opportunities. A strong culture that the manager finds it to be ‘right’ in the respective circumstances can enhance organizational performances by directly or indirectly energizing and motivating the people, unifying them among the shared goals and shaping a desired behavior pattern in order to align everyone’s actions with strategic priorities. The positive relationship between organizational culture and organizational success has been found in a number of studies. Daft (2009, p. 387) reported that the study conducted by Kotter and Heskett provided evidences that those organizations that were successful in managing culture outperformed the organizations that didn’t. According to Willmott (1993, p. 515), culture and performance relationship is evident from its ‘strengthening’ capacity as strengthening of the culture can enhance organizational performance by securing greater commitments among people in the organization. How and why an organization’s culture influences the employee performance? It’s because, the culture in an organization can help to turn its people on or off, as it can energize people in order them to accomplish, achieve and produce what they are targeted of (Harris, 1998, p. 81). Newstrom and Davis (2004, p. 93) are of the opinion that a culture of productivity is an essential element in organizational success just as yeast as critical ingredient in baking bread. As and when people in an organization are agreed within an organization on a culture, there will be larger degree of cooperation, control, communication, decision making etc. This in turn will help the organization increase the productivity from its people. Getting the culture right is critical to organizational success, but what is right culture? Whether a strong or a weak culture? A customer friendly culture or a customer focus one? An organizational learning culture or virtually integrated culture? A specific culture may not be fit for all the organizations and for all different circumstances, and therefore identifying best fit culture by analyzing the whereabouts of the organization is one of basic point in determining whether the culture is right or not. A best fit culture is for no doubt is right, but the best fit culture depend on the organization and its marketing, business and operational circumstances. According to McShane and Von Glinow (2004, p. 482), a strong organizational culture occurs when the employees within an organization hold the dominant values. a strong culture and its values are long-lasting. Such strong values and cultural attributes can be traced back to the beliefs and mission or vision ideas established by the founders or early managements of the company. But, a company may have weak culture when the dominant values are short-lived and are held by few people either in the top or other levels. As McShane and Von Glinow (2004, p. 482) it is not possible to conclude that either strong or weaker culture is right or best fir as to have positive impact on higher performance. But, rather it has been found in many studies that a strong culture increases organizational performances only when the cultural contents are appropriate for the organization’s environment. As shown in the depiction above, as and when culture contents fit the business environment, the corporate performance will be positively impacted. In short, it is not any specific culture or subculture, but the circumstances and business environment determine which particular culture or subculture is best-fit and thus right. For a manager, not only getting the culture right is most important and key element in leading his organization to success, but also identifying which one particular kind of culture is right for his organization and establishing its values, ethics and aspects based on the environment are also extremely critical to the success. Managing the Culture From the description above, it can be understood that the managers need to identify which specific culture is right and thus to establish its values in order to lead the business in to desired goal. Yes, managers need to address the culture and manage it effectively in order to bring success, achieve competitive advantages, gain advantages of high performance working etc. Managers need to address the culture more effectively so that better results can be brought and ensure organizational success as well. A good number of researchers find culture as an important variable that can be controlled and manipulated like any other organizational behavior and therefore approaching it as an organizational variable is critical to managing the culture (Meek, 1988, p. 469). Schermerhorn, Hunt and Osborn (2005, p. 447) argued that good managers are able to help build resilient cultures in situations where they are absent and also able to reinforce and support an existing culture. It means, the main two elements of managing culture are 1) establishing a new culture in an organization and 2) reinforcing and supporting an existing culture. For both of these functions, managers may go for a large numbers of different strategies. Managers normally take varieties of management strategies to manage organizational culture. Some of such strategies are teamwork, effective knowledge management, collaboration, reward and recognition and the like. Each culture is unique and therefore addressing them also would vary from firm to firm. Tosi, Mero and Rizzo (2000, p. 376) illustrated that culture is significantly affected by the broader society that the organization exists in. As each organization culture is unique, management approach to address the culture also will be different. Managers will put efforts to maintain the culture because it will support the current power structure and therefore it is expected that socialization strategies and ideas will help strengthen the current cultural values. The first and basic step in managing the culture is recognizing the subculture (Schermerhorn, Hunt and Osborn, 2005, p. 447) and the manager should take initiate to link goal related strategic issues with key collaboration issues and to come up with series of general ways so that the organization can mange its affairs. In managing the organizational culture, managers require: 1. Establishing generally understood boundaries for all the people in the organization, 2. Facilitating a consistent way of approaching newer situations and 3. Helping individuals get together by ensuring a success pathway. Buelens, Kreitner and Kinicki (2002, p. 65) illustrated a four-step system for managing the culture, as depicted below. The four-steps in addressing the organizational culture are detailed below: 1- Giving the members an organizational Identity Managers should concentrate on identifying and establishing an organizational identity and focus on conveying the proper messages to the meebrs regarding the organizational identity. 2- Facilitating Collective Commitment: People’s commitment to organizational activities and shred values can help organization move towards its goals more easily. When people in an organization show commitment together towards organization, the management may find easier to bring change, manage resistance to change and create better organizational environment too. 3- Promoting social system stability: Buelens, Kreitner and Kinicki (2002, p. 65) described that social system stability represents the extent to which the work setting and work environment is perceived as positive and reinforcing, and ensures conflicts and change are managed effectively. In managing the organizational culture, the third step is a strategic approach to promote and enhance social system stability in the organization. 4- Shaping behavior by helping people make sense of the surroundings: This step and managing action helps employees understand why and how the organization does what is going to do and how it is planning to achieve its long term goals. Organizational Culture functions as a kind of control mechanism because strategic managers can influence cultural values and norms that develop within the organization (Hill and Jones, 2007, p. 416). An effective manager would be able to shape and influence that the members behave. For instance, Bill Gates of Microsoft has been deliberately cultivating values that explained the subordinates how they have to perform their roles. In short, it is possible and is rather very significant for the management to address the organizational culture by establishing the generally understood boundaries for the people and by facilitating the consistent way of approaching new kinds of organizational situations. Conclusion Organizational culture is a basic organizational pattern of shared values, perceptions, assumptions and beliefs that people in the organization think it proper ways of acting and dealing with problems. This piece of research paper reviewed relevant literatures on organizational culture in order to answer the two research questions. In order to be successful, organizational culture is most important thing that mangers are to get it right and they are to address it through efficient and effective managerial strategies. This piece of paper has highlighted that getting the culture right is critical to organizational success, but it depends on organization, rather than just any specific culture is referred as right. A specific culture can be said to be right only if it fits the organization, its whereabouts and circumstances that it is concerned with. Mangers have to address the culture effectively, either by establishing the new in a business that hasn’t, or by reinforcing the current cultural attributes. In addressing and managing the culture, the management is required to give the members an organizational identity, facilitate collective commitment, promote social system stability and shape the behavior of the people by helping them make sense of the surroundings. References Barney, J (1986) ‘Organizational Culture: Can it be a source of sustained competitive advantage?’ Academy of Management Review 11 (3): 656-665 Buelens, R, Kreitner, A and Kinicki, M 2002, Organizational Behavior, Second European Edition, McGraw Hill Companies Daft, RL, 2009, Organization Theory and Design, Tenth edition, Cengage Learning Harris, P.R 1998, New work culture: HRD transformational management strategies, Human Resource Development Hellriegel, D and Slocum, JW, 2007, Organizational behavior, Eleventh Edition, Cengage Learning Hill, CWL and Jones, JR, 2007 Strategic Management: An Integrated Approach, Eighth illustrated edition, Cengage Learning McShane, SL and Von Glinow, MA, 2005, Organizational behavior: Emerging realities for the workplace revolution, The McGraw Hill Companies Inc Meek, V (1988) ‘Organizational Culture: Origins and Weaknesses’ Organization Studies 9 (4): 453-473 Newstrom, JW and Davis, K 2004, Organizational behaviour, Human Behavior at Work, Eleventh edition, McGraw Hill Companies Ogbonna, E (1992) ‘Managing Organizational Culture: Fantasy or Reality?’ Human Resource Management Journal 3 (2): 42-54 Ogbonna, E and Harris, LC, 1998, Managing Organizational Culture: Compliance or Genuine Change?, British Journal of Management, Vol. 9, 273–288 Schein, EH 2004, Organizational Culture and Leadership, Jossey-Bass Schermerhorn, JR, Hunt, JG and Osborn, RN, 2005, Organizational Behavior, Ninth edition, John Wiley and Sons Smircich, L (1983) ‘Concepts of Culture and Organizational Analysis’ Administrative Science Quarterly, 28 (3): 339-358 Tosi, HL, Mero, NP and Rizzo, JR, 2000, Managing organizational behavior, Fourth illustrated edition, Wiley-Blackwell Willmott, H (1993) ‘Strength is ignorance; Slavery is freedom: Managing culture in modern organizations, Journal of Management Studies 30 (4): 515-552 Read More