Organisational Culture and Organisational Change - Case Study Example

Organisational culture and organisational change In organisations all over the world, employees having different mindsets and backgrounds will work together in a coordinated manner to accomplish their allocated work, under the supervision of a leader. This ‘collage’ of workers, although having differences, will work to finish their allocated work for the benefit of the organisation as well as themselves. The uniting of these workers for a common objective under a single structure could be difficult thing to actualize because the differences between could lead to dissension, affecting the organisational atmosphere. As these different workers would try to impose their own attitudes and culture on the organisation as well as fellow employees, it could lead a different, uncommon and complex organisational culture, negatively impacting the organisation’s performance. Thus, for organisation to succeed, all its employees have to work in unison without any differences and for that a common, clear and workable organisational culture need to be implemented in the organisation. To implement a common organisational culture, organisations can even go for a organisational change. That is, as it will be difficult to force common organisational only in some segments of the organisation, it would be better, if the organisation goes for organizational change. When the organization does not perform up to expected levels due to culture issues and in other cases wanted to expand or diversify its operations, the management method has to be changed. This is where the concept of organizational change comes into the picture. That is, organizational change constitutes the structured changing or transitioning of employees, departments and the organizations as a whole from a current state to a favourable or desired future state. So, here the main need or necessity for an organisation to change is to implement a common organisational culture, thereby maximize the collective advantages or benefits for all the employees, managers and leaders working for the organization, and thereby maximize the profit and standing of the organization. So, this paper as part of literature review will discuss how implementing a common organisational culture will lead to organizational change and how leaders and managers had to be aware and importantly control these changes by case studying Starbucks. Literature Review When an organization initiates the process of change management, the first main role the leader should perform is build an academically, technically strong and experienced workforce as part of the organisational culture, who will be able to do the assigned work effectively and professionally. This view was agreed by Schein (2004, p. 261) who in his work, Organizational Culture and Leadership said, “... best way to build an organization was to hire very smart, articulate, tough, independent people and then give them lots of responsibility and autonomy”. He further went on to say that, normally, organizations or its management or its leader in the initial stages will recruit or build a working group of employees, by associating individuals who came from the same ‘stable’ like friends, work mates, family members, etc. This mainly happens at the start of the organization. Then, as the organization continues to function, setting different targets and importantly initiating the change management process, it will give rise to different needs, necessitating recruitment of new set of employees and training the existing employees. So, one of the first ways in which the organizations can positively begin its change management process or positively manage the changes is by strengthening its recruiting process, with the leader playing a prominent role in the recruitment process. This crucial importance of leader in the change management process has been put forward by the former American President, Roosevelt (cited in Goulston, 2006, p.38), who has said that “The best executive is the one who has sense enough to pick good men to do what he wants done”. After recruiting the new staffs, organizations should train or coach or mentor the recruited staffs and even the existing employees, for it to manage the changes optimally and reach the top echelons. That is, when the existing or old employees of the organization fall short in their performance, mainly due to any lack of skill and knowledge about the new process, the leaders should formulate and implement good training methods. An wholesome training will do a world of good for the employees, as they will become equipped skill wise and knowledge wise, and will be able to undertake theirs allocated work as part of management change, with renewed confidence, to aid the leaders. On the other hand, Hughes and Kinder (2008) in the website, Training zone brings out the different or negative perspective of these training programs by stating that, if the employees are not trained well enough and thus were unable to work in the changed environment effectively, it will paralyze the whole organization. Their words are, “In order to remain competitive, change is an inevitable part of organisational life. But resistance to change can trigger productivity paralysis through low morale and reduced output.” Schein (2004) brings out the role of leaders in the post-recruitment period by stating that when the apt employees are recruited, it is the duty of the leader of the organization to quickly impose his/hers assumptions, ideas, principles, etc on the employees and thereby a form an organizational culture. According to him, when the organizational change occurs, the employees will have a slightly unclear thought process, without any clear rules, regulations, work ethics and importantly organizational culture to follow. So, if the leader quickly forms an organizational culture it will optimize the organizational change. But, slightly deviating from Schein’s view, Beer and Nohria (2000) state that, leaders should implement organizational culture in a patient way, giving more importance to teamwork and communication. They state that Leaders focus on developing corporate culture, patiently building trust and emotional commitment to the company through teamwork and communication. When the organizational change is taking place, the employees should be part of the change and importantly should be motivated optimally to contribute to the change. For that, the leaders should involve the workers to play an active part in all the important processes that is taking place within the organization as part of the organisational culture, including the decision making process. The decision making process and the importance of the resultant correct decisions for the well being of the organization was put forward by Sitkin in his work, Learning through Failure: The Strategy of Small Losses. According to Sitkin (n.d) Decisions are made to achieve a specific outcome, and in the case of a business organisation, such an outcome is intended to be in line with the purpose and business of the organisation. But, Shiller (n.d) gives a different perspective to Sitkin’s views by stating that not all decisions may turn out well, either because the factors that were considered when the decisions were made were wrong or have changed, or there was a fault in the decision-making process, which can happen for several reasons including overt interference of the leader. So, to balance the different perspectives of Sitkin and Shiller and to find or reach a common ground, Roosevelt vouches for a controlled role for the leader. That is, even while allowing them to contribute their inputs to the process, the leaders should not meddle. “The best executive is the one who has… self-restraint to keep from meddling with them while they do it.” (Roosevelt, cited in Goulston, 2006, p. 38). McNamara (n.d.) in his Basics in Internal Organizational Communications states that an important component that should be incorporated in an organization, during the change management is effective communication channels. According to him, as part organisational culture, effective communication channels can be established by firstly focusing on the physical environment of the organization, with the leader taking the initiative. Leaders and managers should realize that effectively conveying and receiving information through communications (internal and external) increases substantially the performance of the employees and the organization. For that, Schein (2004) suggest that the leader should go for an open-office layout. According to Schein, when the organization undergoes change, the cubicles should be preferred instead of offices with doors. Because, in an office set up where team work will have prominent place, face to face interaction would bring in more ideas, than one calling other into a closed room and having a closed discussion. Also, according to Schein (2004) minimization of the use of status symbols such as private offices, special dining rooms for executives, and personal parking spaces should be carried out. This will make the employees feel equal and thereby contribute optimally to the change management. Gagliardi (cited in Ashkanasy et. al, 2000) provide a deeper and psychological meaning to the statement of Schein. That is, according to them, Symbols “enable us to take aim directly at the heart of culture” because they represent and reveal that which is tacitly known and yet unable to be communicated by an organization’s members. So, it will give even the lower staff, the feeling that as part of common organisational culture all are treated equal, irrespective of the salary, experience etc. Boyacigiller, Goodman, Phillips, (2003) supports this perspective by stating that a firm which understands its environment and fashions a response to that environment at the macro level would have a far greater success. Change management in Starbucks Starbucks Coffee or Corporation, US based coffee chain was founded by three persons Jerry Baldwin, Zev Siegel and Gordon Bowker in 1971. From that beginning, Starbucks has elevated his status to become the world’s largest Coffee shop chain. But, like any other high performing organizations, Starbucks also wants to grow, profit wise, by increasing the number of shops. Apart from this aspiration, Starbucks also wants to establish it as the most recognized and respected brand in the world. To achieve that brand image, Starbucks apart from putting its marketing department to fullest work, wanted to optimize the performance of its employees and also wanted to indulge in charity and society conscious activities. So, as mentioned above the part or section, which Starbucks wanted to change is certain ethical related aspects affecting its brand image. The background for this change management is that, in the early part of 2000, Starbucks came under attack from different types of people for its involvement in controversial and unethical issues like Fair Trade coffee and bovine growth hormone milk. As part of the strategic change management and incorporation of a common organisational culture, Starbucks’ Chairman, Howard Schultz adopts workers’ contributed mission statement. That is, Starbucks management led by Schultz will normally introduce a mission statement among the employees particularly the new employees, and form a final statement based on the feedback. “New employees discuss the Starbucks mission statement and do customer-service role-playing.” (Schultz qtd. inc.com). So, the first big idea that was implemented by Schultz was the actualization of the ‘customer feedback incorporated company’s mission statement’. This emphasis on the human employees and the customers by Schultz showed Starbucks’ ethical values. The other change management strategy which was successfully implemented by Starbucks and Schultz as part of organisational culture is to build long term productive relationships with farmers who supply the bean for its coffee products. So, decisions regarding Starbucks’ relationship with farmers and its commitment to social welfare programs were also taken. That is, Schultz mandated that coffee farmers especially from its major sources in the African countries of Ethiopia, Rwanda, etc, should be paid premium prices, so that it constitutes the concept of Fair Trade and also they have enough money to look after the family, and avoid planting illegal crops. The other main strategy of Starbucks which formed part of change management and fulfilled its CSR, is the implementation of various social development programs. The program which involves construction of infrastructure to the needy fulfils ethics issues, because the rich and self-sufficient organizations are expected to do something to the ‘insufficient’ sections. Its decision to co-operate with CARE has resulted in many beneficial activities to many communities, like construction of many welfare infrastructures including clean-water systems, health and sanitation training and literacy. So, the contribution made by Starbucks helped CARE to implement many society elevating projects, which is still elevating the living condition of the people as well as the company’s image, even receiving an award from CARE. So, by concentrating on their important partners and aiding them, Starbucks are keeping themselves ethically correct, thereby changing or nullifying the negative image it gained, as part of its change management process. Conclusion When an organization is underperforming or wanting to expand its operations further, it will indulge in change management to achieve those objectives. But, the process of change management will not be a smooth affair, with various obstacles blocking and also slowing the process. When an effective leader with fullest efforts from the employees initiates and manages the organizational change, then it can be a success. So, unison of humans into a team as part of a common organisational culture, with an urge to usher an organization by positively changing the organization will be a successful endeavour, if the leader or manager exhibit optimum function. If the leader as well as the managers, departments and employees show good work, then the organization can actualize optimum change management and would have a ubiquitous presence all over the world. References List Ashkanasy, N. M, Wilderom, C and Peterson, M. F 2000, Handbook of Organizational Culture & Climate, SAGE, London. Beer, M. & Nohria, N. 2000, Cracking the Code of Change, Harvard Business Review, May-June, 133-141. Boyacigiller, N.A., Goodman. R. A. and Phillips. M.E. 2003, Crossing Cultures: Insights from Master Teachers, Routledge, New York. Goulston, M. 2006, Get Out of Your Own Way at Work...and Help Others Do the Same: Conquer Self-defeating Behavior on the Job, Perigee, New York. Hughes, R and Kinder, A. (2008) On the Couch: Counselling at Work, viewed on May 5, 2010 http5://www.trainingzone.co.uk/cgi-bin/item.cgi?id=17737 inc.com, Lasting Impressions, viewed on May 5, 2010 http://www.inc.com/magazine/19980701/968.html, Date accessed 17/12/2008 Mabey, C, Skinner, D, and Clark, T. 1998, Experiencing Human Resource Management, SAGE, London. McNamara, C., Basics in Internal Organizational Communications, viewed on May 5, 2010 http://www.managementhelp.org/mrktng/org_cmm.htm, Schein, E. H. 2004, Organizational Culture and Leadership, 3rd Ed., Jossey-Bass, San Francisco. Shiller, R., “Market Volatility and Investor Behaviour.” American Economic Review vol. 80, no.2, pp.58–62. Sitkin, S. (n.d) “Learning through Failure: The Strategy of Small Losses.” Research in Organizational Behaviour , vol.14,pp.231-266. Read More