Management Consulting/Organizational Culture

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Question
What do you understand by an organizational culture? Is there a relationship between service and culture of an organization? Justify with the help of a case of an organization.

Answer
WHAT  IS  ORGANIZATION  CULTURE ??

HOW  AN ORGANIZATION's  CULTURE CAN BE KNOWN ?

Organization culture  can  be  a  set  of  key values , assumptions,
understandings  and  norms that  is  shared  by  members of an
organization.

Organization  values  are fundamental beliefs that  an organization
considers  to  be  important , that are  relatively stable over time,
and  they have an  impact on  employees behaviors and  attitudes.

Organization  Norms  are  shared  standards that define what
behaviors  are  acceptable  and  desirable within organization.

Shared  assumptions  are  about  how  things  are  done
in  an  organization.

Understandings  are  coping  with internal /  external  problems
uniformly.
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LEVELS  OF  ORGANIZATION  CULTURE

LEVEL 1---VISIBLE, that can be  seen  at the surface level
-dress  codes
-office layout  [ open  office]
-symbols
-slogans
-ceremonies[ monthly / annual awards/long service/birthdays etc.
etc etc

LEVEL 2-  INVISIBLE , that can be cannot be  seen but only felt.
-stories  about people performance
-symbols [  flag, trademark, logos, etc]
-corporate mission  statements
-recruitment/selection  [ methods  used]
-fairness in treatment
-social  equality
-risk  taking in  business deals
-formality  in  approach
-discipline
-autonomy  for  departments
-responsiveness  to  communication
-empowerment  of  staff.
etc  etc.
===============================================
Importance of Organizational Culture

Organizational culture is even more important today than it was in the
past. Increased competition, globalization, mergers, acquisitions, alliances, and various
workforce developments have created a greater need for:

-Coordination and integration across organizational units in order to improve efficiency,
quality, and speed of designing, manufacturing, and delivering products and services  

-Product innovation
-Strategy innovation  
-Process innovation and the ability to successfully introduce new technologies, such as
information technology
-Effective management of dispersed work units and increasing workforce diversity
-Cross-cultural management of global enterprises and/or multi-national partnerships
-Construction of meta- or hybrid- cultures that merge aspects of cultures from what were
distinct organizations prior to an acquisition or merger
-Management of workforce diversity
-Facilitation and support of teamwork.
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In addition to a greater need to adapt to these external and internal changes, organizational culture
has become more important because, for an increasing number of corporations, intellectual as
opposed to material assets now constitute the main source of value.

Maximizing the value of
employees as intellectual assets requires a culture that promotes their intellectual participation
and facilitates both individual and organizational learning, new knowledge creation and
application, and the willingness to share knowledge with others. Culture today must play a key
role in promoting

-Knowledge management
-Creativity  
-Participative management  
-Leadership  
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Effects of Organizational Culture
There has been a great deal of anecdotal evidence and some empirical evidence regarding the
performance effects of organizational culture.
-Southwest Airlines (21,775% return on investment ,
-Wal-Mart (19,807% ROI),
-Tyson Foods (18,118% ROI),
Circuit City (16,410% ROI),
and Plenum Publishing (15,689% ROI) .
These winners have strong leadership that promotes unique strategies and a strong culture to help them
realize these strategies.

Growing evidence that excellent companies do not remain excellent for
long also suggests that the traditional notion of a strong culture may need to be replaced with a
more discerning understanding of the types and role of culture and the need to change culture
over the life cycle of the organization.
For example, perhaps a strong consistent culture is useful
in the beginning start-up phase of an organization but a mature organization may need to become
more differentiated as well as more oriented to change and learning.

What is important for long- term organizational success may not be a particular type of organizational culture per se but the
ability to effectively manage and change the culture over time to adjust to changes in the situation
and needs of the organization. This understanding has pointed to the need for a more dynamic
understanding of culture and the role of organizational leaders in ensuring that the culture
contributes both to the organization’s current and future success.


Leadership today is essentially the creation, the management, and at
times the destruction and reconstruction of culture. In fact,“the only thing of importance
that leaders do is create and manage culture” and “the unique talent of leaders is their ability to
understand and work within culture” . Leaders must be able to assess how well the
culture is performing and when and how it needs to be changed. Assessing and improving
organizational culture as well as determining when major cultural transformations are necessary
is critical to long-term organizational success. Managing differentiated cultures and creating
synergies across these cultures is also a critical leadership challenge. Effective culture
management is also necessary to ensure that major strategic and organizational changes will
succeed. Basically, culture management is a key leadership and management competency.

However, effective cultural management does not depend on great individual leaders and charisma.
Charisma may be an advantage in times of crisis and change, but solid instrumental leadership can be as, or
more, effective in more normal circumstances .

Critical  instrumental mechanisms for changing and managing culture include

-Strategic planning and the identification of necessarily cultural requisites  
-Ensuring consistency of culture with mission, goals, strategies, structures and processes  
-Creating formal statements of organizational philosophy and values
-Establishing consistent incentives, recognition systems, and performance measurement
-Maintaining appropriate error-detection and accountability systems
-Coaching, mentoring, informal and formal training, and identifying role models  
-Embracing appropriate rites, rituals, symbols, and narratives  
-Taking advantage of the growth of subcultures
-Managing and promoting strong communities of practice .

Several requisites for organizational success that organizational culture must
now take into account:
-The organization must be proactive, not just reactive.
-The organization must influence and manage the environment, not just adapt.
-The organization must be pragmatic, not idealistic.
-The organization must be future-oriented, not predominantly present/past oriented.
-The organization must embrace diversity, not uniformity.
-The organization must be relationship-oriented, not just task-oriented.
-The organization must embrace external connectivity, as well as promote internal
integration.

These fundamental assumptions are key to eliminating obstacles that will inhibit the kinds of
internal and external organizational adaptations necessary for future success. They are not,
however, sufficient. They must be reinforced by values, behavioral norms and patterns, artifacts
and symbols, as well as accompanied by a particular mission, set of goals, and strategies.

Others emphasize more specific cultural mandates, such as that the modern organizational culture
must be:  
-Team-oriented.
-Knowledge and learning oriented .
-Alliance and partnership oriented .
-Another emerging mandate is to
-Know when to emphasize and how to balance cultural maintenance and cultural
innovation.
-Managers must actively work to keep the existing organization culture relevant to the present and
future while maintaining some sense of continuity with the past.

Companies with long-term success had a limited but strong set of timeless core values that did
not prevent organizational change over time. These companies were able to preserve the core
while stimulating progress.
--------------------------------------------------------------
Cultural Change
Cultural change typically refers to radical versus limited change. It is not easy to achieve; it is a
difficult, complicated, demanding effort that can take several years to accomplish. There are
three basic types of cultural change

-Revolutionary and comprehensive efforts to change the culture of the entire organization
-Efforts that are gradual and incremental but nevertheless are designed to cumulate so as
to produce a comprehensive reshaping of the entire organizational culture
-Efforts confined to radically change specific subcultures or cultural components of the
overall differentiated culture.

Strategies for effecting cultural change include  

-Unfreezing the old culture and creating motivation to change
-Capitalizing on propitious moments—problems, opportunities, changed circumstances,
and/or accumulated excesses or deficiencies of the past
-Making the change target concrete and clear
-Maintaining some continuity with the past
-Creating psychological safety through a compelling positive vision, formal training,
informal training of relevant groups and teams, providing coaches and positive role
models, employee involvement and opportunities for input and feedback, support groups,
and addressing fears and losses head on
-Selecting, modifying, and creating appropriate cultural forms, behaviors, artifacts, and
socialization tactics
-Cultivating charismatic leaders
-Having a realistic and solid transition plan
-Exercising risk management by understanding and addressing the risks and the benefits
as well as the potential inequitable distribution of these risks and benefits.
===================================================

Four essential strengths of the organizational culture approach:
•   It focuses attention on the human side of organizational life, and finds significance and learning in even its most mundane aspects (for example, the setup in an empty meeting room).
•   It makes clear the importance of creating appropriate systems of shared meaning to help people work together toward desired outcomes.
•   It requires members—especially leaders—to acknowledge the impact of their behavior on the organization’s culture. Morgan proposes that people should ask themselves: "What impact am I having on the social construction of reality in my organization?" "What can I do to have a different and more positive impact?"
•   It encourages the view that the perceived relationship between an organization and its environment is also affected by the organization’s basic assumptions. Morgan says:

We choose and operate in environmental domains according to how we construct conceptions of who we are and what we are trying to do. . . . And we act in relation to those domains through the definitions we impose on them. . . . The beliefs and ideas that organizations hold about who they are, what they are trying to do, and what their environment is like have a much greater tendency to realize themselves than is usually believed.
===========================
Today, people live in an environment that is increasingly moving towards services-based economy. The concepts of
service quality and satisfaction in marketing activities during the past decades have been the focus of attention.
There is the advantages of satisfaction and consider them as indicators of the competitive advantage of organizations, although the exact nature of customer judgments and the relationship between these two is still hung in the balance . Willingness to provide quality services in today's world plays an important role in the
service industries. Because service quality is considered crucial for organization's survival and profit making.
Service quality plays a significant role in customer's satisfaction, maintenance, and stability. In addition, the chain of services - profit - income is associated with the stated factors .

strategic benefits of quality, market share and return on investment in partnership development and in reducing production costs and in enhancing productivity . But before discussing service quality, it is essential to understand the concept of quality. Quality is the customer's satisfaction and enjoyment or simply fulfilling or
surpassing customer's expectations .  Internal service quality leads to the satisfaction of staffs [maintenance of staffs] which in turn leads to external service quality and customer satisfaction
whose final product is profitability, growth, and development. Internal service quality is the most essential element to achieve high quality of external services and it is imperative that be reviewed in most sport environments. Several
factors contribute to the Internal service quality in An  organization. Among these factors, organizational learning culture, job satisfaction, organizational commitment, learning motivation, organizational atmosphere and
organizational justice. Organizational learning leads to competitive advantage for the
staff who have a clear vision of the importance of quality service. Organizational learning can be defined as a dynamic process of creating, acquiring and gathering knowledge and resources to develop the capacity and resources, which leads to better performance of the organization . Certainly the culture of organizational learning
will play a significant role in the internal service quality .There is a significant relationship between organizational learning culture and internal service quality in the staff of the
ORGANIZATION  departments There is a significant positive relationship between
organizational learning culture and internal service quality in  ORGANIZATION. There is a significant relationship between organizational learning culture and internal service quality;
and organizational learning culture would account for 5% of the variance of internal service quality. Hays and Hill
That for having a superior external service quality, organizations need staffs [internal customers]
committed to the goals and prospects of the company and require customer oriented behavior and the internal
service quality [satisfaction of organizational units from each other],  shows that there should be a
close interaction between internal service quality and external quality.
internal service quality had a significant positive effect on staff retention due to the
role of job satisfaction. Job satisfaction increases when internal service quality increases. Satisfaction of internal
customers is a strongly associated with internal service quality which in turn has strong relationships with customers
who receive external service. Management should meet the needs and expectations of internal customers so that the
staff have high levels of satisfaction and give high quality external service to external customers
=========================
HERE  IS  AN EXAMPLE  OF  ''implementing  value based culture''.
the organisation I am  referring to

The  organization, I am  familiar  with  is  a
-a  large  manufacturer/ marketer of  safety products
-the products  are  used  as  [personal  protection safety] [ industrial  safety]
-the products  are  distributed through  the distributors as well as  sold directly
-the  products  are  sold  to various  industries like  mining/fireservices/defence/
as  well  as  to  various  manufacturing  companies.
-the  company employs  about  235  people.
-the  company  has  the following  functional   departments
*marketing
*manufacturing
*sales
*finance/ administration
*human resource
*customer  service
*distribution
*warehousing/  transportation
*TQM  
==============================================
IN  THIS  COMPANY, WITH WHICH  I   AM  ASSOCIATED,

Value  based  culture   is  the  management  approach  that  ensures corporations
are run consistently  on   value,  such  as
-maximising  shareholders  value
-adding  values  to  the  customers'  service.
etc  etc
THIS  INCLUDES
-creating  value in all actions/strategy
-managing  for values
-measuring  value  with the  help  of metrics
etc etc
========================================
THE EMPLOYEES  WHO  LIVE  BY  THE VALUES OF  THE  ORGANIZATIONS
SHOW  IT  BY  THEIR  EFFORTS / PURPOSE/DIRECTION/SUPPORT.
-by  aligning  all  their  actions/programs  with the  organization  vision.
-by  aligning  all  their  actions/programs  with the  organization  mission.
-by  aligning  all  their  actions/programs  with the  organization  objectives.
-by  aligning  all  their  actions/programs  with the  organization  strategies.
-in  maximization of  value creation  for  customers
-in  increasing   value  for  company products  for  the  market
-in aligning  company activties  with  the  interest  of  shareholders
-in  maintaining  quality  communication  internally/ externally
-in  allocation  of  resources [ finance]
-in  allocation  of  resources [ human resources ]
-in  handling  complexity in operation
-in   handling  uncertainty in operation
-in managing   risks  in  operation.
-in planning  /  budgeting
========================================
-WATCH   THE   Work  practices

1   Direction - management's style and attitude as it affects employees
2   Commitment - attitudes towards work and the organisation
3   Recognition - motivation and recognition of employees
4   Collaboration - cooperation and teamwork within groups and departments

-WATCH   THE   Cultural Values
:
1   Risk - attitudes toward risk taking, structure and ambiguity
2   Individuality - attitudes toward contribution and self reliance
3   Compliance - attitudes toward rules and exceptions
4   Dominance - attitudes towards hierarchy, power and equality
=============================================================
WHAT   ROLE  IS  PLAYED  BY  TOP  MANAGEMENT  IN  THIS  ORGANIZATION,
IN  CREATING  VALUE  BASED  CULTURE  SYSTEM?

THE  TOP  MANAGEMENT  IN CREATING  VALUE  BASED
CULTURE    SYSTEM  PROVIDE
-value  based  corporate  vision  
-develop   a  value  based  mission  statement
-provide  a  value  based  corporate  OBJECTIVES
-provide  a  value  based  corporate  STRATEGIES
-provide  a  value  based  corporate  COMMUNICATION  SYSTEM.
-provide  a  value  based  corporate  GOVERNANCE
-provide  a  value  based  corporate  CULTURE
-provide  a  value  based  corporate  ORGANIZATION  STRUCTURE
-provide  a  value  based  corporate  MANAGEMENT  STYLE
-provide  a  value  based  corporate  DECISION  MAKING  PROCESS.
-provide  a  value  based  corporate  PERFORMANCE  MANAGEMENT  SYSTEM
-provide  a  value  based  corporate  REWARD  PROCESS
-provide  a  value  based  corporate  CLEAR  MANAGEMENT  PRIORITIES.
-provide  a  value  based  corporate  BALANCE  BETWEEN SHORT TERM/LONG TERM TRENDS.
-provide  a  value  based  corporate   SHARED  VALUES
-provide  the  required  skills  to  the employees
etc etc
============================================
IN  IMPLEMENTING   CULTURAL  CHANGE,  WHAT   WE  DO

-DEFINE  THE  CULTURE  VERY  CLEARLY.
-''CHANGE  MANAGEMENT''  IS  MORE  IMPORTANT  THAN  CULTURE  ITSELF.
-What I have  suggested  is   a  blend  of  guidelines/ideas/concepts  on the
process of  managing  the   change  of  culture  in  an  organization.

I must  also   emphasise   that  the  culture change  is always done   with  a  purpose.
YOU  MUST  STATE   THIS  VERY   CLEARLY  UPFRONT.
PEOPLE  ANCHOR    THE  PURPOSE  FIRST, THEN  CHANGE
THE  BEHAVIOR.

ALL  THESE  STEPS  WILL  HELP  YOU  TO  MANAGE  YOUR
ORGANIZATION  MORE  EFFECTIVELY.
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