Changing Organizational Culture: Cultural Change Work in Progress - Essay Example

Management Management A. D. Chandler carried out research on the relationship between environment, organizational culture, strategy, and the structure of the organization. He defined strategy as the long-term goals a company sets and structure as the framework through which strategy can be implemented. He said that both structure and strategy are linked together and presented the Structure follows Strategy theory after reviewing the workings and organizational structures of four amalgamates in the US. He said that changes in the strategy necessitate changes in structure to accommodate the administrative issues that have emerged with the changes. One of the organizations that he studied was the Sears. Chandler proposed that Sears and the other three companies that he researched upon had grown and diversified by adopting the multi-divisional form of organizational structure. The multi-divisional form of organizational structure, or the M-form, is a corporate group of semi-independent products or geographic groups whose activities are supervised by headquarters that charts out management strategies and synchronizes interdependencies. Sears started opening retail stores in the 1920s and opened many stores in Chicago, Indiana and Englewood, with its main headquarters at Homan Avenue in Chicago coordinating the company strategy. Up till the 1950s, the company had opened many urban department stores and had diversified itself by adding companies like Allstate Insurance Company. However, the M-form is not the only organizational structure; other organizational structures include functional, geographic, hybrid, matrix, form/product and user/market. The functional structure is concerned with the specialized management of its parts where the geographical structure distributes parts in different places. The product organizational structure deals with the material people are dealing with, while the market structure works on the basis of market segmentation. The hybrid structure combines two structures, but the matrix organizational structure entails a repeating substructure within each department under one roof (SUNRISE Information Services, 2010). 2. Organizational culture refers to the beliefs, cultural values and professional and ethical codes of conduct that craft what the business stands for. It is reflected in many forms within the organization such as the language and traditions of the employees, goal of the business, in group dynamics and the values that are tied to it, the working environment etc. CEOs have emphasized on organizational culture because of its advantages to maximize the gains of the business, increment the revenue and to enhance the shareholder value. The effectiveness of the organization and its culture can be analyzed and assessed by the 7 S framework. The Seven S’s are structure, strategy, shared values, style, staff, skills and systems. There are many different types of organizational structures, each having its advantages and disadvantages; for instance, a hierarchal structure can help create communication line between the top and bottom levels but on the same hand, multiple layers can create communication barriers. Since the strategy of the organization helps to craft structure, cultures and values of the organization can influence strategy. The CEO sets the goals for the organization to achieve, which reflect in the shared mission of the employees and the business on the whole. Style also plays an important role in the effectiveness of the organization. The attitude of the managers is a model for subordinates to follow. If the managers are embroiled in issues such as competition and shareholders, they would pay less attention to their customers, and the management decisions would not necessarily reflect the interests of the customers; subsequently, having an impact on the way a business performs. Staff is also greatly impacted by organizational culture. If the managers are domineering in their approach, the employees are going to be suppressed, leading to less job satisfaction, which could affect the conduct of the business. The skills of the employees, such as an attentive and empathic attitude towards the employees, also mirror organizational culture. The systems which interact with customers need to be designed in a customer-centered way (Cook, 2009). 3. Cultural web helps organizations to assess and change their culture. Cultural assumptions and practices of the organization can be tested and modified to put them in line with the strategy of the organization. The cultural web consists of six major elements that are interlinked and help to define and bring changes in the organizational culture. One of the elements is stories. Stories say a great deal on what the organization stands for, since stories relate accounts and practices of the organization and its people. Rituals and routines encompass the behavior and conduct of the employees. This behavior is considered acceptable over time, and can help managers predict the responses of the people in specific conditions. The daily behavior is also representative of what the organization stands for, since only that behavior would be deemed acceptable and given a chance to flourish which is synonymous to the strategy of the organization. The routine ways, however, can be taken for granted by employees and is illustrative of the paradigm set of suppositions of employees; therefore it becomes very tedious to change. The need to change routine and rituals arises when employees start taking things for granted to such an extent that they do not make efforts to improve upon their competencies and blame others for their mistakes. Symbols represent the company through visual elements such as logos and can be used by managers as symbols of privilege. Organizational structure refers to the structure that the authorities have designed and other influences that decide what things are to be valued the most. Power structures are the key figures of the organization with whom rests the power regarding decisions etc. Control systems provide ways to control itself, such as quality systems to ensure checks, bonus systems for employees etc. Control systems need to be changes if they have become outdated or do not meet the requirements of the business anymore. Companies who are experiencing fiscal problems would pay more attention to formal budgetary control. Control systems can also be modified for rapid and prompt reactions to complaints and emergencies (Johnson, et al., 2008). 4.1. In the organizational structure, leadership plays a role in recruiting new members, and motivating the current employees. Leadership also deals with the instillation of the shared goals in the employees and in encouraging them to work in concert with each other to achieve those goals. This role can not be delegated to other people; e.g. the Continuous Improvement Teams of CEO Don Lennox were supervised by managers, rather than consultants. Leaders should have the ability to translate the goals of the organization into tactics that can be used by the employees in their routine and so it follows that they play an important role in maintaining and changing organizational culture. For example, government institutions often need to respond quickly to changes in the global trend to keep at par with other progressing countries. In order to respond to these changes, leaders are needed to redefine the goals and the objectives of the organizations. This would include how employees work together and to change the routines and rituals of the employees to accommodate the changes in strategy. 4.2. The style of managerial behavior is important in affecting organizational change. Organizational change involves the alignment of all the elements of the business in a way that allows the easy shift in strategies. Since managers are responsible for bringing about and supervising this change, they need to be effective and persistent. The persuasion that they offer needs to be coherent and justifiable; if managerial behavior is not persuasive, it can fail to affect change. For example in a study held in Melbourne about organizational change in the restaurant industry it was sent that for managers to effectively supervise and implement change, they need to adopt a behavior that pays attention to their communication approach with the employees, employees’ attitude and their views of the managers’ actions and the motivation of the employees (Chew, et al., 2006). 5. A new CEO is not accustomed to the organizational culture and does not have knowledge about the set of assumptions that the employees use commonly. A cultural web would help the new CEO to develop insight into the workings of the organization. The cultural web would give the CEO a bigger picture of the values of the organization and the codes of conduct of its employees. The stories that he or she will hear about the past key figures and events of the organization will provide the CEO with the history of the organization and in understanding what values are inherent and given high importance in the company. The rituals and routines of the organization can help the CEO comprehend workflow dynamics, the core beliefs that they depict and to draw effective strategies to improve team work. The rituals and routines also give an idea of what the customers expect from the organization and the CEO can use this knowledge in management decisions. Symbols portray the image that the company projects and any status symbol or particular jargon can assist the CEO to be aware of the image and workings of the company. Organizational structure will prove to be instrumental to the CEO to decide how decisions and information are relayed from the top hierarchal levels of the business to bottom levels. Control systems and power structures will provide the CEO with details about which factions in the company are strong and how powerful are the employees. This information can aid the CEO in deciding upon bonus systems etc. Power structures can also give the CEO an idea if power is abused or not, and who can influence the decisions that he or she makes. The CEOs can learn how to work with integrated human resource services and maintain idea of its client orientation through cultural webs (Alvesson & Sveningsson, 2007). Reference List Alvesson, M. & Sveningsson, S., 2007. Changing organizational culture: cultural change work in progress. Oxon (OX): Routledge. Chew, M. M. M., Cheng, J. S. L. & Petrovic-Lazarevic, S., 2006. Managers’ Role in Implementing Organizational Change: Case of Melbourne Industry in Melbourne. Journal of Global Business and Technology, 2 (1), pp.58-67. Cook, S., 2009. Understanding organisational culture. [Online] (Updated June 2009) Available at: http://www.thestairway.co.uk/understanding-organisational-culture.html [Accessed 10 June 2010]. Johnson, G., Scholes, K. & Whittington, R., 2008. Exploring Corporate Strategy: Text & Cases, 7/e. 8th ed. New Delhi: Pearson Education India. SUNRISE Information Services, 2010. Organization Structure. [Online] Available at: http://www.sunrisepage.com/manage/orgstruc.htm [Accessed 10 June 2010]. Read More