BMW Work Culture and Environment - Case Study Example

Running Head: BMW Work Culture and Environment BMW's Dream Factory and Culture 3rd November 2009 Introduction Corporate cultureis a dynamic phenomena always surrounding, being constantly enacted and created through interactions with others and is shaped by leadership behaviors. (Schein, 2004: p 2) Further, Schein (2004:17) defines group culture as a 'pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptations and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems' This notion was supported by Davis (2003:7), clearly stating that neither culture nor leadership can be understood individually and the important function of the leader is to create and manage culture and it is up to the leaders to understand and work with culture. The present paper aims to describe the culture at BMW, its model of leadership and impact on the culture, and to assess the attributes of organizational creativity that are fostered at BMW. 1) Culture at BMW Schein (2004:20) states that an occupation involving intense period of education and training, shared learning of attitudes, norms and values will be assumed to be taken for granted for the members of the group. Organizational culture is essential for successful organizational change as well as maximizing the value of human capital and to create management competency. (Management Heaven, 2009) The cultural strength of BMW can be measures in term of its policies involving employees in decision making process an through profit sharing initiative much EU introduced and its leadership strategy to ask questions to get the best answer. BMW introduces several development programmes from manufacturing plants at Leipzig and providing flexibility and innovations in the design as per the customers' requirement and the employees have a sense of history, vision and mission once they set foot inside the company which immediately gives the employees a sense of meaning to their job which ultimately shows that BMW is empowered with good organizational culture. 2) Leadership Model and Its Impact on BMW Culture Davis, Inc (2003:7) supports Schein's statement that process of culture creation is the essence of leadership and that leadership and culture are two sides of same coin. It is further stated that leaders create and change the organizational culture whereas the managers and administrators apply themselves to that culture. Leaders need to act as role model, have realistic visions, personal performance, willingness to change, create a working environment stimulating enthusiasm and enjoyment which is prevalent in BMW as the employees and high level executives and other professionals work side by side applying their ideas and thoughts to carve out better design. (Pergamon Flexibile Learning, 2005) BMW gets much of its strength from unparalleled labors that are flexible enough to work extra hours to meet the financial targets. BMW followed an unusual strategy like once the employees were rewarded for the creative error of the month with a bottle of fine wine from the boss's cellar and the employee was recognized for an outstanding and bold idea, which was well planned but failed working on the idea for three years. The idea by the leaders was to remove the stigma of making mistakes at work while innovation. (EmeraldInsight, 2006) BMW leadership stressed more on encouraging their employees which motivates them to work harder, intelligently and effectively. Thus BMW leadership model is very effective in achieving optimum output without have significant effect on the culture. 3) Employee Satisfaction Hellriegel and Slocum (2008) states that an organization need to motivate its present and future employees by providing utmost job satisfaction. Some of the key job characteristics to motivate employees at workplace include basic human needs, designing jobs that motivate people, enhancing belief that desired rewards can be achieved and treating all employees equally irrespective of position. Further, the motivational cycle presents that first employee identifies the need, searches ways to satisfy it by selecting goal directed behaviors and performing it which is later rewarded or punished which further motivates the employee to reassess need deficiencies. As per the job characteristics mentioned above, BMW provides regular benefits to its employees who are recruited after intense sessions of interview and later go through extreme training sessions to be able to meet the expectations of the organization. Intrinsic motivation is powerful since the worker knows that there is an immense responsibility in performing the job because BMW corporate culture defines it. Another source of motivation among BMW employees is the profit sharing system which makes the employees work harder for they know that they are responsible for the outcome of production. Good production simply means good profit so each worker internalizes the responsibility and cares about the outcome of the job. As the organizational culture of BMW is such that every year human resource department receives thousands of job application which clearly shows that BMW has a good rapport among its employees 4) Organizational Creativity Organizational creativity is very much evident in BMW. Even the design of their Leipzig plant takes into account how people could communicate with each other openly so that ideas may flow smoothly and naturally which was teamwork of Cluassen, the Plant Manager's creativity and Knau's creative engineering concept (Edmonson, 2006). When it comes to design, BMW has an edge over its competitors like Toyota by using organizational creativity. For one, the company specializes in tailoring cars that suits the wants of customers which other car manufacturers cannot afford to execute due to budgetary considerations. When BMW is in the process of conceptualizing a new car model, a whole team of specialists are involved. BMW organizes brainstorming workshops for its employees to gather information and to formulate new innovative designs and strategies for the development of organization. Moreover, young blood such as designers from US as well as Germany is pitted against each other so that the brightest ideas would surface. Apparently, designers for BMW are not tied to rigid requirements but are free to explore avant-garde designs. 5) Effects of Culture and Work Environment BMW has been strong in the market for many years due to the influence of its organizational culture. Its entrepreneurial environment makes everyone feel responsible for the profitability of the organization. The company's profit sharing reward also compels employees to go an extra mile in the performance of their duties. The organizational culture reflected in the policies and practices inside BMW conditions the psychological states that the employees are into the management process of the company. More important is the fact that the culture permeates the work environment very well that employees internalize the responsibility of working for the prestigious but practical BMW. Openness in communication which is integrated in the work environment also contributed to BMW's success. Conclusion BMW with over $60 billion sales is able to give tough competition to the US auto giants only because of its effective strategy in dealing with the employees and its customers allowing them to own a car according to their specifications through online. Employee satisfaction was guaranteed long ago through profit sharing initiative making them no less than owners, allowing the management to have flexibility of working hours, no issues with the unions otherwise labor strikes are witnesses every now and then. The organizational culture of BMW attracts recruitments in huge numbers and its creativity enables the management and employees to foster new ideas through constant training, workshops and teamwork, the result of which is Liepzig Plant. References 1) Edmondson, G. BMW's dream factory. Business Week, October 16, 2006, 70-80. EmeraldInsight (2006) Why BMW reward employee mistakes, Journal of Strategic Direction, Vol.22, No.2, pp-28-29 2) Hellriegel and Slocum (2008) Organizational Behavior, Cengage Learning, Canada, pp 124-159 Management Heaven (2009) Organizational Culture, History, Theories, Organizational Culture Importance, HR-Corporate Culture, http://www.managementheaven.com/culture6/ 3) Davis M., Inc (2003) Corporate culture as the driver of transit leadership practices, Issue 47 of Synthesis of transit practice, Transportation Research Board, USA, pp. 7 4) Pergamon Flexible Learning (2005) Development for high performance, Management Extra. Vol. 3, Elsevier 5) Schein, E.H (2004) Organizational culture and leadership, The Jossey-Bass business & management series, Vol, 1, John Wiley and Sons, USA pp 2-20 Read More