the environment and corporate culture. environment organizations are open systems which import...
TRANSCRIPT
The Environment and Corporate Culture
EnvironmentOrganizations are open systems which import information from its
environment and use double loop learning to adapt the organization to changes in
the environment.
External environment
– General EnvironmentInternationalTechnologicalSocioculturalEconomicLegal-Political
International environment
GlobalizationGlobal competitionCross cultural dynamicsAre the theories and practices of American management compatible in other countries?
Technological
Technology is rapidly changing the business environment– Information and communications– Technology pertaining to speicific
industries– The interaction of technology and
people – socio technical systems
Sociocultural
Population distributionPopulation densityAgeEducation levels
Economic
Consumer purchasing powerUnemploymentInterest ratesFuel pricesCompetition from other countries
Legal political
OSHAEPALaw suitsConsumer protection lawsProduct safetyInformation and labeling
External EnvironmentDriving Forces have an impact over time
ExamplesHealth consciousnessPolitical conservatismComputerizationDemographic shifts toward Asian and
Hispanic minoritiesThe baby boom generation
Task Environment
The five forces Model of Porter– Customers– Suppliers– Competitors– Substitiutes– New Entrants
Relationship of the company to its environment
Organic organization – open system Mechanistic-closed system
How organizations react to environmental changes
Open systems maintain relationships with their environments and react to changes (effectiveness)Environmental Scanning– Detects changes in the environment
over time.
How organizations influence environmental changes
Advertising– Change demand for product
Public Relations– Change the image of the company
Political Activity and trade organizations– Influence the legal and politcal
environment
Internal environment
– CultureTechnologyStructurePhysical facilitiesEmployeesManagement
Internal environment
Physical Structure– Plants– Sales Offices– Showrooms– Computer network– ICTSocial Structure– Formal – Informal
Internal environmentThe Social Structure
Formal Social Structure– Official documents
Org charts BilawsBudgets
– Contractual BoundariesDepartmentsSub-departments
Internal environmentThe Social Structure
Informal Structure– Rules of behavior– Shared meaning– Corporate culture
Corporate Culture
Defined as:
Key values, beliefs, understanding and norms shared by members of the organizationIt is their shared reality
Embodied superficially by:
Visible artifacts – dress– patterns of behavior– symbols– ceremonies– layout
Embodied at a deeper level by
StoriesLanguageMythsHeroes
There are different types of cultures but it is crucial that the culture be
adaptive to the changes in the environment less the organization become extinct e.g. the dinosaur
Types of Cultures
Adaptability Culture
If the environment requires fast response and high risk decision makingManagers encourage values that support ability to detect, interpret and translate signals from the environment into responsive behavior
Achievement Culture
Environment requires high level of service over a long time without much changeResults oriented excellence. Achieve difficult ambitious targets
Clan Culture
If we keep our people happy, and help get their needs met, they will meet the needs of a changing environment.Focus on cooperation, consideration, no status differences
Bureaucratic Culture
Focus inwardLess concern about the environment and more about following the rulesThrifty, orderly way of doing things
Changing demands for managing corporate culture
Culture the glue that holds the organization togetherBy definition, shared values and realities must be sharedDissemination of culture is done by – Picking the right people who will fit into
the corporate value system– Socializing people