Culture performs an important part in our society. It refers to beliefs and codes of practice that makes a community what it is. In addition, it performs the same role in organizations. A strong organizational culture will provide stability to an organization as it offers significant affect on the behaviour and behaviours of organization's users. Most of company's top professionals have a strong understanding that the culture of any company is vital to everything they certainly and works irreplaceable part in their success. However, not many companies can say that they can illustrate their culture and fully understand how important it is in the success of these businesses. Therefore, this newspaper will give a deeper information about how an organization's culture can have a great influence on its strategic management procedures.
What is Company Culture ?
There are various explanations and elements to explain organizational culture. For some, it means top management beliefs and values about how they should manage the organization and conduct the business enterprise (Lorsch 1986). For a few, it can be an evolutionary process relating to people that creates unique heroes for the business (Hatch 1993). However, in general, organizational culture has been thought as the structure of fundamental assumptions or beliefs that a specific group has developed through understanding how to deal with its problems of inner assimilation and exterior adaptation, and that contain been approved to work well, and therefore it can be educated to new people as the correct way to understand, feel and react in relation to those problems (Schein 2009).
The Need for Organizational Culture in Strategic Management :
Considering the importance of organizational culture and its own impacts in proper management is very essential. As organizational culture and strategies are both communal procedures, many strategists argue that culture and strategies are connected. Corresponding to Alvesson (2002), social dimension plays a vital role in all aspects of an organization. It really is so impacting which it can determine the success and failing of a business. In leadership concept, organizational culture has been discovered as one the key components that proper leaders can use to develop dynamic organization. Culture demonstrates the way in which people in an organization set objectives, manage their resources and perform their duties. Culture also influences people behaviour unconsciously. Even in those organizations where the ideal of organizational culture do not obtain much explicit attention, how people think, feel, value, believe and behave in a business are generally inspired by ideas, values and perception of the cultural nature. Matching to Schein (2010), organizational leaders achieve success by constantly sending clear indicators about their priorities, values and principles. Once culture is made and accepted, they turn into a strong management tool for market leaders to connect and energize their people with beliefs and beliefs to do their jobs in a technique supportive manner. When leaders succeed in campaign ethical culture in the organization, they will also become successful in organizational development and consequently are competitive to their rivals. Therefore, it is vital to develop a strong culture in the organization as well as strategies that are appropriate to the culture to become strengthened by it. If a specific strategy will not match with the organization culture, it could be almost impossible to accomplish expected end result from the organized strategy.
Organizational Culture, Eyesight and Objective in Strategic Management :
One of the point of view to check out how organizational culture helps strategic management is through its affect on organization's missions and visions. Missions and visions play an important part in company's tactical management. According to Harrison and John (2010), a written objective assertion is one of the most common way that managements use to talk to their staffs about proper route. Generally, missions and visions point out the company's purpose and values which provides ideals and course for the business as it interacts with the marketplace. This will not only provide a sense of purpose to inside and exterior stakeholders but also help them in tool allocation decisions which is very to carry out company's strategy management. However, in order to have an effective missions and visions, managements need to hook up these to organizational culture. In fact, one of the best way to see an organization's culture through its reflection in core prices (Schein 2010). Corresponding to Tocquigny and Butcher (2012), primary values will be the set of notion or ideology by which an organization manages. They are the foundation of organizational culture. On this fast paced time when everything is changing, central values remain constant. The business may develop new strategies, regulations or even significantly restructure; however, the fundamental identity of the business still remains intact. These ideals will be the essential, foundational key points that will guide the organization's eyesight, mission and strategies as well as define and differentiating the business from its opponents (Senske 2003). They generate a foundation of behaviour and practices that each customers have to agree to follow in order to support the eye-sight and long-term success of the business. They also provide reference factors and goals which allows organization to form and enhance its business. As internalized perception and beliefs can motivate staff's performance to exceptional levels, an efficient strategic market leaders need to comprehend and develop their designed integrated strategies that are suitable to organizational culture to be able to go after the eyesight of organization's market leaders. Until organization makes a decision what those social values are, and how they will connect to one another, its very hard to do anything else, whether setting goals, establishing measurements, fixing problems or even making decision effectively.
One example about how organizational culture can support company's eyesight and objective is Facebook. Facebook is referred to as 'a cutting edge technology that constantly taking on new issues in the worlds of milliseconds and terabyte. Their perspective for the company is to create a quickly changing and ground breaking company. They don't aim for excellence that requires quite a while in order to launch the merchandise but they weigh heavily on being able to make and send products quickly, get customer's opinions and continue to innovate it. To be able to encourage creative imagination and invention within the company, Facebook's culture created by Zuckerberg is a relaxed, unstructured and open culture. Employees will come and go as they please, with no standard work schedules which results in more worker flexibility. If employees need to chill out, they can play video recording or table-top game titles. Collaboration and teamwork are encouraged to be in a casual communication and atmosphere. They also constantly encourage people to keeping things fresh, impressive and interesting, to be strong in experimenting new ideas, with no meddling from above. All of these have fostered for a fun-loving, casual and creative working environment which makes their staffs satisfied while achieving their goal to be a rapid ground breaking technology company (Robbins and Judge 2011).
Organizational Culture as Competitive Benefits in Strategic Management :
Another reason that makes culture become a determinant of business success or failing is because of its contribution in organization's competitive edge. Creating and sustaining competitive advantage in a particular industry is actually the major concern in organization's tactical management. It is because competitive advantage can help the organization to identify itself from its rivals while building up its position in the market place. Corresponding to McDonald and Gandz (1992), culture can contribute positively to the competitive advantage of companies. It's rather a great tool for corporation to increase their degree of performance which makes it become more competitive in market place. Fernandez and Hogan (2003) have mentioned that culture is the root attitudes and beliefs that can firmly influence individual and group behaviour. When members in an organization talk about the same beliefs and prices, they can understand what kind of attitudes they expect themselves and other folks showing in working place as well as how they have to behave and respond in particular situation in order cooperate well with one another. As they know very well what the company is trying to accomplish, it'll motivate these to work for an increased purpose which in turn helps to establish an organization in addition to the competition (Gilmartin 1999). Managements can also use organizational culture as a highly effective tool to dictate, control and manage employee behaviours in their tactical management (Sinha 2008). In fact, this is a more powerful way of managing staff than company's regulations. Leaders in the business may use culture to influence, educate and shape their employees 's mentality and attitude to gain their support in following a company's plan and method while reducing resistance in the organization. Having a solid, positive and strategy-supportive culture will influence the energy, enthusiasm, working habits and operating practices of employees that will not only booster the efficiency and effectiveness in the department but also catch the attention of many visitors to work in the organization while lowering their staff turnover, selecting and training cost which results in yielding a competitive advantage.
Not only contribute to company's competitive benefit, organizational culture also sustains the company's competitive advantage. As a company starts to experience the superior financial performance, its competitors will also begins to seek to replicate what they believe is the source of competitive advantage that produces the success of the company. After examining the partnership between culture and superior financial performance, Barney (1986) figured culture is the factor that can help companies to create sustained competitive gain. He strongly thinks that a strong and valuable organizational culture is one of the most sustainable competitive advantages a business can have. This is because a valuable and rare cultures is very difficult to imitate. Providing enough time and money, opponents can duplicate almost anything what an has done. They can employ the service of away some of the company's best people. They are able to reverse engineer the business's processes. However, as it pertains to organizational culture, they cant duplicate the organization's culture. It's very hard for folks to explain culture plainly, especially in respect of its contribution to value of company's product and service. Another reason for this is that culture is usually related to historical areas of company development as well as to the vision, values and motivation from particular proper market leaders. Organizational culture is the uniqueness and the id of an organization that will differentiate the business from its rivals. If companies learn how to employ culture in their strategic management, it'll be a robust tool for them to preserve their competitiveness and consistence in the market while aiding them to achieve success in their strategy implementation. Even when competitors make an effort to apply the firm's cultural attributes, you will see no guarantee that they can produce the same culture or obtain superior financial performance just like what the company has achieved.
A good example to demonstrate this point is Zappos company. Realizing that customers nowadays not only give attention to good products nevertheless they also demand excellent service from the retailers, Zappos's strategic plan is to create a permanent brand that not only about shoes, clothing or online retailing but to be about the best customer service and the best customer experience. To have the ability to accomplish that goal, Zappos is convinced that organizational culture is the only answer. They assume that if they can obtain the culture right, the majority of other stuffs such as great customer service, or passionate employees, or building great permanent brand will effortlessly happen alone. In order to make employees to deliver a great service, rather than just using guidelines and procedures like others to teach staffs, the managements in here have shaped their staff's way of thinking and frame of mind by using culture to transmit their message to their staffs. Zappos have created a culture that induces employees to "wow" one another when you are yourself, as crazy or weird as possible, displaying your care and attention and love for other people, and just having a great time in the workplace. As the employees begin to be wowed by their colleagues, they will automatically want to do a similar thing for other people, specifically for their customers. This culture not only makes employees to be happy in their office but it also stimulates staffs to be creative and enthusiastic in wowing their customers which results in upsurge in their repeated customers and their sales performance. This culture is something unique that people usually do not find in other companies rendering it appealing to their staffs as well as to other folks to work in Zappos. It becomes a competitive good thing about Zappos which cannot be copied by other challengers. It makes Zappos are more competitive and differentiate themselves using their rivals on the market place (Hsieh 2010).
Organizational Culture and Strategic Decision Making :
Another perspective for managements to consider about the value of their organizational culture in strategic management is its effect on their proper decision making. As it has been mentioned above, culture is the organization 's identity, principles, beliefs that influences how people, from managements to employees, behave in the organization. Therefore, Thompson and Martin (2005) have concluded that organizational culture is the heart and soul of most strategy creation and execution. Organizational culture provides the framework for the organization, which affects practically all the organizational activities, from the execution of strategy to the acceptance and implementation of new procedures (Soyer, kabak and Asan 2007; Hill 2009; Cumming and Worley 2009). For managements, culture impacts their behaviour unconsciously. It affects the choice, incidence and application of the settings of strategy creation, which displays the beliefs and personal preferences of the proper innovator. Managements do part of particular ways since it is implicitly expected behavior inspired by organizational culture. Culture also influences the selection of men and women for particular jobs, which results in impacting how tasks are completed and decisions are made. In addition, it influences the ability of a innovator to deliver his or her ideal and perspective to other associates of the organization as well as attaining their support and commitment as it pertains to applying new strategy in the organization. To be able to have an effective strategy implementation, it needs the winning attitude, approach and commitment from employees which can only be influenced by culture. Whenever a strategy match with company's culture, the culture will become a valuable ally in strategy implementation and execution. When it's not a part of the change strategy, management will most likely find it hard to use the strategy effectively as well as achieving their target (Lawson and Ventriss 1992). Berry (1983) also thinks that it can be a wiser choice for managements to choose an enterprise or strategy that will fit their company's organizational culture well to be able to alter the organization toward a fresh strategy instead of accomplishing cultural change, that can be very difficult to accomplish. Therefore, it is vital to identify the prevailing cultural proportions of the organization in order to attain successful strategy execution. Organizational culture can be considered a powerful source to support company's strategy but at the same time, additionally, it may become a great barrier to leaders if they do not consider it carefully. By understanding the components of organizational culture and its effect on people's behaviour, I is convinced that strategic leaders will be better prepared to make smart decision to make and implementing strategies to their company.
One example about how precisely culture influences proper decision is Walmart. In Walmart, their viewpoint is to offer customers a lesser price than they can get in anywhere else. Its culture is based on low priced end of every transaction in order to make revenue, not from the costing end. Together with the principle of cutting down is important as costing, the plan has always been to operate a vehicle costs out of the system in the stores, from the manufacturers' income, and from products broker agents and other middlemen, all in the service of generating down prices at the retail level, in order for Walmart to sell more, increasing the amount of business with the vendor. To keep their charge low, Walmart restricts its store locations to rural areas with a maximum human population of 10, 000. This will not only maintain down real property costs but also protect the business from heavy competition in metropolitan areas. They also try to find healthy suppliers that can provide timely deliveries at low prices. Managements in here also constantly check their competition price to ensure that Walmart provide best drive. All of these proper decisions support the primary principle and aim for which is keeping costs whenever you can in order to provide lowest prices in the market (Refrigerated Transporter 2002).
In bottom line, I firmly assume that there is a strong connection between organizational culture and proper management. Every company has its unique culture. It isn't only the organization's personal information but also the beliefs, principles that every member in firm imagine and value, which affects not only people's attitude in the organization but also the strategic decision making and management in the company. If eyesight and objective of organization's market leaders is the target that the business is aiming, then I believe that culture would be the compass that leads company for doing that goal. Minus the support from organizational culture, it can be impossible for companies to accomplish their intended final result. Culture also performs an important role in company's competitive edge. It is an essential aspect that will helps organization to safeguard and sustain their competitive benefit from their challengers. As organization will keep building, treasuring their culture as well as carefully considering and applying it to their strategic management, I think that the company will be able to accomplish their goal and their leader's perspective.
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