Organisational Culture and Management - Assignment Example

Organisational Culture and Management Executive Summary For an organisation to grow and achieve desired results there has to be a clear relationship between individual employees and the organisational culture. Organisation culture dictates the behaviours and values that should be followed by all employees from the top most to the junior most. The work of managers entails harnessing efforts from all employees and ensuring they result to profitability and success. As such, they are supposed to fully understand the organisation’s culture so as to offer clear cut guidelines on processes and procedures to be followed. Managers need to understand what type of culture they are to adopt or change based on the nature of business. With the dynamism currently witnessed in the global business environment, today’s managers are left only the choice of blending various types of organisation cultures. For fully fledged businesses like multinationals, the managers need to understand and closely monitor the various dimensions of organisational culture so as to make changes where appropriate and at the opportune moment. IBM management seems to be quite aware of the blending aspect of the types of organisation culture as well as the importance of understanding its various dimensions. Introduction Many are the times that the word culture emerges in conversations in the workplace. It is, however, true that many do not understand the significance of culture in determining the success or failure of an organisation. For a firm’s management to effectively steer through the increasingly competitive global business arena, it must identify all aspects of the organisation’s culture. There has to be a match between the human capital and the culture that the management wishes to incorporate. Organisational culture consists of shared values and behaviours which define what is acceptable or not in the context for that particular firm (Jain, 2005). This, therefore, means that one firm may exhibit values and behaviours that are totally unacceptable in another firm. As such, each firm bears a form of organisational culture that defines its operating principles which in turn define people’s beliefs and values. One key characteristic of culture is that it is shared which means that if an organisation has a positive culture, the outcomes of employees’ efforts are positive and vice versa. It is through this assumption that the management has to scrutinize a firm’s culture so as to identify weaknesses which almost always translate to reduced performance. In the global business arena, organisational culture has come to dominate management tactics especially in global businesses. A good example of an organisation whose global presence has resulted in culture becoming a key factor in decision making is IMB. Throughout the lectures on organisation culture and management, it is clear to see how significant culture is towards overall performance. Change management cannot, therefore, be wholly detached from organisation culture since for change to be initiated, culture has to be changed in the process (Alvesson and Sveningsson, 2007). This is a difficult issue as changing culture involves changing people’s beliefs, values and behaviours which they believed in and practiced before. Despite the difficulties involved, this move has seen transformations from non performance into excellence in business operations, in numerous local and multinational organisations. To change the culture in any way, the shared vision needs to be changed so that employees’ behaviours correspond with the values. For this to take place the management and of IBM in this case, needs to fully understand organisational culture and its dimensions and ensure it blends the various types of cultures to ensure best results. This report analyses IBM in light of these two aspects as excerpts from the lectures while offering information on other key aspects of organisational culture and management as far as this company is concerned. Types of Cultures and IBM Different organisations embrace difference types of organisation cultures based on management’s preferences or nature of the business environment. It is necessary to note that the current global business environment cannot allow an organisation to adopt one form of concept and define a successful path. It is, therefore, necessary to blend concepts by adopting the best that quite a business (Peng, 2010). As the following types of cultures will show, IBM, as central to the lecture case study, has combined all. These types are categorized into stable/internal, stable/external, flexible/internal and flexible/ external. Bureaucratic Culture This type is stable and internal to the firm, and as the word term suggests, it is concerned more with predictability. The employees are required to offer high efficiency in operations and deliver standardized commodities at the end of all processes, and this is the one that IBM has adopted from this type. The management in this case operates to ensure that laid down standards and codes of conduct are adhered to at all times (Turner, Bititci, Mendibil, Nudurupati and Garengo, 2006). For this type of organisations, changing the ways of doing things may not be easy since it requires radical changes in people’s perceptions and attitudes because they are too much involved in routine and hierarchical mode of operations. Clan Culture This form of culture is more group oriented than individual. It encourages socialization and group interests far outweigh personal interests. It is through this form that many organisations try to ensure that employees have a feeling of personal ownership. Modern organisational management techniques have seen organisations offer employees certain percentages of share equity ranging from CEOs to the junior most (McAleese and Hargie, 2004). This cultural orientation inculcates a sense of pride in membership as it works to promote Maslow’s hierarchy of needs 3rd category; Belonging Needs. This form advocates on teamwork and consensus which leads to better decisions and thorough outcomes. It also advocates that employees have to be quite sensitive to customers’ needs and expectations. IBM has adopted the latter two characteristics by ensuring teamwork and fulfilment of customer expectations. It is thus flexible but internally oriented culture. Entrepreneurial Culture This is the culture that is made to constantly result to changes rather than react to changes from the environment. It is thus highly experimental, and the management dedicates a lot for time and resources to research and development thus value rests on innovation and new ideas (Woodside, 2010). Many technology companies adopt this style, and it has seen some, for example, Apple, Facebook, Microsoft and now IBM offer unique products and record rapid growth in the past decade. This culture rewards individual excellence and offers room for personal growth and development. It is, therefore, flexible and externally oriented. Market Culture This culture is fundamentally weak socially, and rewards are hugely based on direct performance. This form has seen many CEOs and top management staff of multinationals take home hefty bonuses after high profits over the past two decades (Ashkanasy, Wilderom and Peterson, 2010). In this regard, performance results have been categorized into quarterly and annually so as to base the reward system and this is what IBM has adopted in this culture type so as to reward performance. There is a huge gap between the top management and the ordinary employees and union’s power is high. This form of culture is, therefore, stable but externally oriented. Dimensions of Organisational Culture at IBM Innovation and Risk Taking IBM operates in the highly volatile technology industry which demands a high level of innovating and risk taking like never before. IBM appreciates this fact and, as such, the management has put numerous channels that encourage innovation. This organisation has risked a great deal of investment funds in research and development, but this has made IBM the giant technology company it is today. For example, IBM strengthened its innovation in the early 2000 and, as a result, in 2005 it received the highest number of patents the world; they totalled 2,886 in United States. The IBM zeal in innovation trend is also evident considering that it has received most of the top awards in regards to patenting since 1996; in actual sense it held the number one position from 1996-2005 (Sara, Reger, IBM Research and Institute for Business Value, 2006). Licensing loyalties is another business that proves lucrative for those organisations that engage heavily in research and development and IBM is no exception. This aspect alone has earned this company billions of dollars over the past 2 decades. It is also necessary to appreciate that with research comes risks as enormous resources are put to facilitate desirable results. However, this is not always the case, and numerous researches turn out to be flops either in the design process or even at the market place (which is heavily disadvantageous) (Martins and Terblanche, 2003). Nevertheless, IBM has taken these drawbacks as learning experiences and capitalized on the successes in the research and production processes. Attention to Detail In the technology sector, attention to detail is a fundamental consideration in ensuring that only top-notch products are developed and offered for sale. This is where expertise meticulousness and analysis is demanded from all employees (Adekola and Sergi, 2007). This requirement, on the other hand, goes against cost minimization goal and developmental time frames which essentially affects profitability. Attention to detail and thorough analysis obviously lead to time wastage and this issue results in heated discussions in IMB as there is a thin line between efficiency in production and efficiency in resource utilization. IBM has to this effect established a database that tracks all product development and innovation issues, and it analyzes production changes and all failures in all processes. It is through the desire to enforce this cultural dimension that IBM adopts the Bureaucratic Culture type as laid out rules and policies have to be followed so as to ensure consistency and reliability within the production process. This goes far in delivering customer satisfaction and market dominance. Outcome Orientation IBM has a system where departments hold meetings on a monthly basis. It is in these meetings that the vision and outcomes are discussed at length. Departments have to ensure that they deliver high quality products that are aligned to customers’ expectations, within certain cost limits and within the expected time frames. These may seem easy on paper, but when it comes to real issues, each one of these aspects takes hard work, teamwork and sheer determination to achieve (Schermerhorn, 2009). Many technological products have generations whereby the current product in the market has other new generations in the line of development. As such, each task force handling any of these products has to report on progress. For example, for those assigned the products already in the market, they need to track customers’ feedback and usability of the product. This information is crucial for the developers of the 2nd and 3rd generations of the same product as they able to upgrade them accordingly. The ones tasked with the upcoming generation products are tasked with reaching specific milestones in development and have to report on this progress. All these processes aim at the outcome which is the product which is either in the market or that which is awaiting launch. Therefore, in any case, the desired outcome has to be achieved so as to ensure successful market leadership and penetration (Woodside, 2010). People Orientation and Team Orientation Management at IBM highly considers the human capital both individuals and teams. As such is not uncommon to find individual staff members in high ranking offices discussing work related issues one on one with department managers (Keyton, 2010). This concept that has existed in IBM for quite a long time nurtures a culture of respect and openness towards issues that affect the business as a whole even at the bottom of the management hierarchy. Line managers are able to get and relay timely feedback both ways that enables efficiency in operations and more so in the production and service delivery services (Heskett, 2011). It is still through these meetings that employees are able to negotiate terms and performance related feedback. The uniqueness with such meetings is that they are highly confidential as they are behind closed doors where cell phones are turned off. Teamwork in IBM is given the highest priority, and cross functional teams are quite common. Interdepartmental meetings and consultations are also held regularly as all staff members irrespective of affiliated department work towards a common vision and mission (both of which centrally define the company’s culture). Without teamwork, none of the technological giants would be where they are not just IBM. Aggressiveness This is a term that encompasses passion for work and sheer determination in execution of one’s duties. The basic aim for management to ensure this aspect is that, without it, little can be achieved which will translate to a destructive culture. For the entire organisation to achieve intended results and even to surpass them, individual employees have to work tirelessly for their inputs to be harnessed and amount to success (Stonehouse and Campbell, 2004). In line with this aspect, IBM gives individual employees tasks that are consistent with their area of expertise and strength and offer opportunities for further studies. Employees at decision making organs are tasked with working hard to outdo competitors and retain the competitive edge. In IBM, employees work 45 hours on a weekly basis and even show up for work during weekends which results in added output annually and cumulatively. IBM management highly respects these employees and as such offers allowances and even as basic as a free lunch during weekends. Stability It is crucial to have stability for an organisation culture to hold and lead the firm to profitability and market leadership. IBM is not credited with the stability aspect as line managers and other positions keep changing (Schein, 2010). These personnel changes destabilize the mode of operations as new employees or new managers result in relatively new way of doing things. Loaning programs where staffs from a department are loaned to another leads to disruption and at time the loaned staff members can work in alien departments for months. Although this may not be such a monumental problem for IBM as most of the key staff members are highly specialized, it may affect the production processes with time. Conclusion The significance for the management of any organisation to understand its firm’s culture cannot be overemphasized as Gerstner said, “I came to see, in my time at IBM, that culture isn’t just one aspect of the game – it is the game” (Heskett, 2011: 17). The work of management is to echo the values of the organisation time and again and state specific expectations for every employee. For the management team to realize success in their tenure, they have to create a positive environment. An environment where individual efforts are rightfully rewarded and teamwork highly valued is the best to ensure success. The management also brings in people who are able to value the company’s culture and does away with those who seem unable. Otherwise, employees would not be as passionate as they are in working towards the overall IBM vision and mission. As indicted, IBM offers both rewards to personal achievements and teamwork spirit for all employees from top management to junior staff. This supportive network in IBM ensures that the culture is transmitted to the new employees year after year. The management has also ensured a culture that encourages innovation and employee empowerment. The ultimate goal is to ensure low staff turnover and high satisfaction in current employees. References Adekola, A. and Sergi, B.S. (2007) Global business management: a cross-cultural perspective Ashgate Publishing, Ltd. Alvesson, M. and Sveningsson, S. (2007) Changing organisational culture: cultural change work in progress, Taylor & Francis. Ashkanasy, N.M. Wilderom, C. and Peterson, M.F. (2010) The handbook of organisational culture and climate, SAGE. Heskett, J. (2011) The culture cycle: how to shape the unseen force that transforms performance, FT Press. Jain, N.K. (2005) Organisational behaviour, Atlantic Publishers & Dist. Keyton, J. (2010) Communication and organisational culture: a key to understanding work experiences, SAGE. Martins, E.C. and Terblanche, F. (2003) Building organisational culture that stimulates creativity and innovation, European Journal of Innovation Management, vol. 6, no. 1. McAleese, D. and Hargie, O. (2004) Five guiding principles of culture management: A synthesis of best practice, Journal of Communication Management, vol. 9 no. 2. Peng, M.W. (2010) Global business, Cengage Learning. Sara, J., Reger, M. IBM Research and Institute for Business Value (2006) Can two rights make a wrong?: insights from IBM's tangible culture approach, Prentice Hall Professional. Schein, E.H. (2010) Organisational culture and leadership, John Wiley & Sons. Schermerhorn, J.R. Jr. (2009) Management, John Wiley & Sons. Stonehouse, G. and Campbell, D. (2004) Global and transnational business: strategy and management, John Wiley & Sons. Turner, T., Bititci, U.S., Mendibil, K., Nudurupati, S. and Garengo, P. (2006) Dynamics of performance measurement and organisational culture, International Journal of Operations & Production Management, vol. 26, no. 12. Woodside, A.G. (2010) Organisational culture, business-to-business relationships, and interfirm networks, Emerald Group Publishing. Read More