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Managing of the Organisational Culture

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The study of organisational culture originated in the 1970’s and has since been an aspect in the study of Human Resources Management. However, the importance of managing culture has only recently come to light, as many companies have added departments dedicated to organisational culture management.

This has resulted in debates between scholars and academics on the possibility of managing culture and the extent to which it can be managed as it plays a vital role in a company’s success. Organisational culture determines the way in which organisations respond towards internal and external environments and as these factors rapidly change, an organisation’s culture would have to be managed in order to adapt to these changes.

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This paper critically analyses the importance of managing organisational culture and to what extent it can be managed, identifying different perspectives and paradigms through theories from scholars and academics as well as examples in the current business environment.

In its broadest sense, culture is defined as a set of values, attributes and behaviors in an individual or groups that distinguishes one from another (Adler, 1997; Hofstede, 1991). Hence, similar to national culture, organisational culture is a set of norms, beliefs and principles that create a manner in which employees within a company combine attributes in order to operate (Brown, 1995; Eldrige and Crombie, 1974).

Organisational culture, therefore practices ‘promoting values and statements of belief’, developed to respond to the internal and external environment of an organisation (Schein, 2004), hence giving an organisation a sense of identity, which distinguishes the way in which ‘things are done’ (O’Donnell & Boyle, 2008).

In order to manage culture within an organisation, a company would have to reflect on the importance and impact it has towards its changing environment.Organisations in every industry would have to react to the changes towards external forces such as new technology or mergers as well as internal forces such as the change in employee needs and wants. Hence every organisation would have to realize that changing and adapting to new forces is the key to surviving within the market and staying ahead of competition (Markovic, 2008). In order for successful change or adaption towards forces, this would intensively depend on the attitude of the company towards change and hence- their organisational culture.

Former president of Ford Mark Fields (2006), argued that ‘culture eats strategy for breakfast’, emphasizing that culture should be seen as a part of strategy, making it a possible source of competitive advantage and to some extent, something that can be managed in order to adapt towards change.

Similarly, Denison (1990) argues that there is a correlation between organisational culture and economic performance, as it becomes the basis of a company’s strategy and decision making, creating different impacts between organisations.

A well-established organisational culture would not only benefit company strategies, but also foster employee motivation and encouragement towards a collective achievement (Milne, 2007). Facebook, for example, has been a workplace many have hoped to work in. Despite the competitive atmosphere, the company successfully promotes a culture of open communication, independence and freedom by breaking rules on traditional office design as well as the many benefits offered to employees such as stock options, on- site laundry and 3 course meals (Entrepreneur, 2015).

In contrast, Kodak built a company culture that was only temporarily successful. Although many academics and analysts suggest the failure of Kodak was caused by the rapid rise of technology, it could be argued that the company’s failure was due to its complacent organisational culture (Johnson, 2016). Kodak failed to recognize the need for change in organisational culture that promotes innovation, which lead to its failure in the market (Rick, 2017).

When dealing with managing organisational culture, it is important to identify the underlying attributes that contribute to the current culture as well as the set target culture, needed to be obtained.

Johnson’s (2016) theory of analyzing organisational culture is illustrated through a cultural web in which visible factors such as symbols, structures and rituals are based on the organisation’s paradigm- the subconscious behavior in which the employees and managers base their decision- making. An example of a paradigm can be found in technology firms in which employees believe that focus and attention should be greater towards the product quality rather than customer service (Johnson, 2016). The external visible factors include informal/ formal structure within the company, beliefs the company is associated with as well as routines and activities mostly monitored and controlled, which provides an image of the company’s current culture.

However, unlike the external factors, the paradigm is a subconscious pattern that is difficult to observe and determine, hence difficult to manage or change.

Artefacts and symbols act as the very tip of the iceberg in an organization as they are visible to both, internal and external stakeholders such as dress code, logos and architecture. Values determine the company’s code of conduct and how this is sent across to the public, such as a company’s mission and vision statement. It is critical that the message sent across to the public is in line with the attitude and behaviors of the employees to ensure brand promise and retain customer loyalty.

Hyatt hotels for example, promote a mission statement that is in- line with their impeccable service and hospitality as they go out of their way to ensure customer satisfaction and needs are met. For instance, pet lovers on vacations would receive a framed photograph of their pet on the bedside table of their hotel rooms. This illustrates the values delivered through their mission statement.

“To provide authentic hospitality by making a difference in the lives of the people we touch every day”.

Also known as the onion model, Schein (1985) further emphasizes that the deeper it is in the model, the less visible and hence the increase in difficulty to change certain aspects Johnson (2016) further supports this theory by illustrating the basic underlying assumptions as the ‘paradigm’ through the cultural web model, further adding that although difficult to determine, it is possible for a company to initiate comprehensive employee discussions or include outside observers to determine the paradigm (Johnson, 2016), suggesting that culture change can be carried out in a longer- term manner.

However, there are limitations of analyzing culture through comprehensive employee discussions or change agents as Schein argues that if decisions are made based on incorrect assumptions of the culture, it could negatively impact the organisation; emphasizing on the importance of carefully determining culture within an organisation in order to lead successful strategic change.

As determined previously, managing organisational culture is vital for a company as it determines how they respond to changes towards internal and external environments. However, there are different perspectives and paradigms that are adopted by change agents and managers as a basis to determine the extent in which organisational culture can be managed and ways to go about the change.

Organizational culture can be seen from the perspective of having two different paradigms, scientific rationalist and anthropological.

The scientific rationalist perspective argues that organizational culture is a component of an organisation that can be easily changed as a variable such as skills and style (Peter & Waterman, 1982). In this paradigm, organisational culture is formed in the perspective or the leaders in the company, rather than the employees (Millett, 2000), usually translated through artefacts such as the company’s vision and mission statement. For example, the major influence of Steve Jobs in Apple that have shaped their organisational culture of creativity, innovation and secrecy.

However, the anthropolical perspective argues that organisational culture is something an organisation has rather than what an organisation is. Therefore, culture is perceived a set of attributes that are inseparable from the organisation, making it more complicated to manipulate or change. It is not values that are instilled or influenced by leaders, however this paradigm is perceived to transform over time as it responds and adapts towards the environment.

A unitary organisational culture comprises of a dominant culture that is visible to change agents or managers. These organisations are mostly found in traditionally structured firms in which shared views of daily tasks form the core values of the organisational culture; values that differ are based on demographics rather than physcographics or behavioural characters. Collins and Porras’  further argue that these organisations build strong core values that are maintained and seldom changed in accordance to the external and internal environment. However, if there was a need to manage culture, a company with a perceived unitary organisational culture would adopt a top- down leadership change strategy as the core values need to be altered, controlled and translated through effective leadership.

In addition to having a dominant core culture, most organisations comprise of subcultures argues that all organisations consist of individuals who bring their own values and assumptions that are based on personal experience and hence, it is only possible for organisations to have a unitary culture that is temporary. Change agents who have a similar perspective, argue that although effective leadership obtains organisational success, managing organisational culture in a company comprising of subcultures would require programs designed for the diverse segments of the company, rather than a top- down management strategy.

Google for example, added ‘Chief Culture Officer’ to their HR department in order to cater to different subcultures, to motivate and encourage employees while maintaining the distinctive organisational culture of the company.

A further form of subculture emerged in management theory with the analysis of subsidiaries of multinational corporations behave and are structured differently in as to the parent company. This suggests that national cultural differences have an impact on the attitudes and behavior of an organization, which can be illustrated through Hofstede’s cultural dimensions.

Taking into consideration the influence of national culture within the organisational culture, a company operating in the United States and Singapore for example, would have a distinguished set of attributes and behaviors when responding towards internal and external environments.

Individualism, which is distinctively different between the two countries, represents whether individuals define their self-image as ‘I’ or ‘we’. Hence, in an individualist culture like the United States, people are seen as independent in contrast to Singapore, which comprises of a collectivist society in which people prefer to work in groups.

Hence, organisational culture would consist of different attributes and structures with the possibility of leaders and employees’ actions based on their national culture.

National culture therefore, could be a factor influencing towards organisational culture as leaders and employees act upon beliefs and attitudes instilled in them through personal experiences, hence should be considered when implementing change towards organisational culture.

In addition to the scientific rationalist and unitary perspective of organisational culture, O’Donnell & Boyle (2008) similarly suggests, the key to effectively managing culture and implementing change is through leadership. Through academic literature and primary research, O’Donnell & Boyle has designed a framework to aid managers and leaders on the six issues that need to be addressed to foster a successful organisational culture that promotes a development and performance.

Taking a leadership perspective, this framework may be effective carried out successfully. However, in an anthropological or pluralism culture perspective, it is believed that it takes more than leaders and managers to implement change in organisational culture, making leaders one component rather than the center of change.

Hence, managing culture can be viewed through different perspectives and decisions made are based on the context adopted by change agents or managers. Legge illustrated organisational culture management through a metaphor of ‘riding a wave’.

“The best the surf- rider can do is to understand the pattern of currents and winds that shape and direct the waves.”

Organisational culture plays a vital role in a company as it determines the way in which they respond towards changes in the internal and external environment. Managing culture, therefore is an important factor that contributes towards a company’s success, making it a source of competitive advantage if managed well.

Through the competing views of scholars and academics on the extent to which culture can be managed, it can be concluded that perspective and paradigms adopted by change agents and managers determine the way in which organisational culture is managed. Hence determining cultural awareness is important, making sure that incorrect assumptions are avoided in order to generate successful culture adjustments or change.

Managing organisational culture is hence a major aspect in human resources management, in correlation to strategic business decisions, which determines a company’s success in the long run.

 

 

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