A Link between Organizational Culture and Competitive Advantage - Literature review Example

Institution : xxxxxxxxxxx Title : xxxxxxxxxxx Tutor : xxxxxxxxxxx Course : xxxxxxxxxxx @2013 ОRGАNISАTIОNАL СULTURЕ АND СОMРЕTITIVЕ АDVАNTАGЕ: IS THЕRЕ А LINK? DISСUSS Introduction As Cornelia (2005, PP. 77) argued the prime aim of every organization is to be successful in realization of its goals and objective. Business organizations for instance have the obligation of providing quality products and services to the public at a cost which ensures some profit in return. As such, the capacity of any organization to achieve its goals determines its sustainability development and success. For this to happen, it requires the interplay of both organizational culture and competitive advantage of that particular organization. Organization culture in this regard, means a set of basic aspects/factors that a group has invented, discovered, or developed by their interaction and learning how to cope with the challenges of external adaptation verses internal integration (Reginato& Guerreiro, 2013, pp. 222). Such factors include attitudes, values, skills and beliefs. In addition, organizational culture includes the unconscious underlying assumptions shared by the team as well as all the physical assets of an organization which facilitates achievements of goals as destined. Through the interactions be it formal or informal members share values beliefs symbols norms and behaviors acting as a guide in their duties, decisions and actions (Reginato& Guerreiro, 2013, pp. 222).In general organizational culture is an asset of any organization that functions as guides, source of inspiration and motivation to decision making and actions hence ensuring the achievement of the set goals. Cornelia (2005, PP. 77).The impact of organizational culture to the success of an organization is also backed by competitive advantage of the organization. As such, competitive advantage is the advantage an organization has over other competitors and it is fundamental in determining how any given corporate sells its products and services to the consumers under high competition. It includes attaching low price to a product or service or additional of value or benefit to the same products and services hence justifying the high price. A company with the capacity to remain highly competitive is said to have sustainable competitive advantage over other competitors. As such, sustainable competitive advantage comes about as a product of organizational culture and it ensures sustainably existence of a business organization as argued by Cornelia (2005, PP. 77). This particular paper therefore intends to analyze whether indeed there is a link between organizational culture and competitive advantages as pointed in the immediate last sentence. An organization goals and objectives are achieved through the consolidated efforts of different organizational culture components. Leadership, for instance, as one of the components of organization culture is very fundamental on the competitive advantage of the organization. In regards to Reginato& Guerreiro (2013, pp 224). leadership as the steering wheel of an organization should be always be in touch with the organizational goals, objectives, vision missions and values so as to always provide leadership which is always in alignment with the organizational goals. (Reginato& Guerreiro 2013, pp 224).Leaders should adopt the best leadership styles for instance transformational leadership which enhances inspiration of the employees hence facilitating the transfer of organizational values from the leadership departments to the labor force department. Additionally, leadership styles that ensure creativity of the employees hence innovative environment, are also fundamental to the success of an organization as noted by Ortega-Parra et al (2013, pp 1073). Apart from ensuring creativity of the employee, the leadership should ideally ensure that the welfare of the employees is well catered for thus cultivating high motivation. Motivated employees carry out their duties with citizenship attitudes which are manifested in the diligence and integrity. As such, they ensure they attend to customers with high level of integrity as well as facilitating the production of quality product and services to the customers. This facilitates progressive value of the customer’s needs thus boosting the competitive advantage of that particular organization (Ortega-Parra et al, 2013, pp 1073). This is so because customers as stake holders will always affiliate themselves with companies where they are highly valued and their needs are meet and if not meet there is always an explanation giving the reason why their need were not adequately meet. (Reginato& Guerreiro 2013, pp 224; Ortega-Parra et al, 2013, pp 1073) At the same time, leadership through patriotic leaders realizes that the needs of the customers cannot all be meet through steering provision of quality products and services, or the good relationship between the customers and the employees but also incorporates corporate social responsibility (CSR) in their leadership therefore creating good relationship with the contemporary society. Leaders do this through mobilizing teams of employees to conduct a research on the different needs of the in the society that the organization can handle. The findings are implemented by responding to the needs appropriately through involvement of the society members who are essentially the stakeholders (customers) of the business organization and the corporate employees. For instance, a company can undertake the responsibility of educating the contemporary society on the topic of good nutrition and its impact as well as providing products to remedy the problem of malnutrition. This in itself according to Ortega-Parra et al (2013, pp 1073) makes the customers feel that they are valued and the relationship with the company is beyond the buyers –business relationship. Indeed according to Ortega-Parra et al (2013, pp 1073) facilitated creating sustainable competitive advantage over the competitors who may be doing the same. As such productivity and existence of the company is guaranteed and can as well continue to be cultivated through incorporation of such programs that care for the needs of the customers. In general value of the customers as shareholders can only be felt by the customers if those values are enshrined in the organization practices. (Ortega-Parra et al, 2013, pp 1073) Employees are part of the organizational culture. Indeed, employees have the capacity to intensify competitiveness and improve organizational performance (Ortega-Parra et al, 2013, pp 1073). They know how to push the organization for better business environment. In fact, no company can build a coherent culture without people who either share its core values or have the willingness and the capacity to embrace those values. Firms should have stringent policies of recruiting new employees therefore ensuring that the employees recruited are not just the most talented but also but also the best appropriate to a particular job culture as noted by Elliss (2013). As further argued by Ortega-Parra et al (2013, pp 1073) employees brings with the selves culture which are sometimes good for the company. This reinforces the culture the organization already has. As such if an organization manages to have expert employees who are ready to embrace operationalize organizations goals and objectives then this will enhance the productivity and therefore creating confidence with the customers. This in turn intensifies the competitive advantage of the company over competitors. (Ortega-Parra et al, 2013, pp 1073; Elliss, 2013) Attitude as another component of corporate culture means a lot to the status of competitive advantage. (Cornelia (2005, pp. 79).As psychologists argue attitudes whether positive or negative motivate a person or an organization to behave either in a positive manner or a negative manner towards the attitudinal object. In a corporate organization open attitude is introduced by developing cultural agility. Cultural agility in this case is the ability to effectively navigate, communicate interrelate and function well in diverse cultural setting like cultures found in business organization. Open attitude leads to self awareness other awareness, knowledge in every member of the cooperate organization. As such, a leader in an organization who cultivates open attitudes facilitates acquisition of knowledge by members (Elliss, 2013).Open attitude employees avoid prejudice on other employees, or ideas of other employees. They usually have wide –eyed approach to affairs and relationship in the workplace. Additionally, open attitude facilitate epithetic relationship with other thus ensuring peaceful coexistence and mutual understanding. Empathetic attitude with others ensures partnership in team work among employees in an organization (Ortega-Parra et al, 2013, pp 1073). As such, this facilitates citizenship in the workplace which in turn increases productivity of an organization. If an organization has the attitude that the customer needs it more than it needs the customer it is destined to fail. Negative attitude towards a customer complains will shows that the company is not ready to respond to the needs of the customer. Open attitude in a company ensures there is good communication between the customer and the organization other than just disregarding complaints lodged by the customers. This in turn helps to maintain the sustainable competitive advantage of the company an even improve it (Ortega-Parra et al, 2013, pp 1073) Similarly, communication is a vital component of organizational culture which determine failure or successes of an organization performance. Indeed for an organization to achieve its goals it must cultivate good communication to all stakeholders responding to their specific needs appropriately. First, the leaders as the overall bosses should initiate sensitive communication where empathy is dominant through active listening towards the employees. Proper communication infrastructure should be introduced such that every employee can be reached at ease and the message delivered. Companies have even introduced technology in their communication infrastructure such as the use of convergent communication. Convergent communication entails the integration of voice, video, and data into a single Internet Protocol net work. This kind of innovation improves the communication (Ogbonna & Harris 2006, pp. 163).At the same time, communication between the employee either formal or informal should be enhanced by introducing session where employees can meet and share their views. As such when the communication is done either from the employees to the management or from the management to the employees there should be appropriate response hence enhancing organization commitment (Rashid, 2003, pp.715). Also management should introduce communication between the company and the suppliers of raw materials as well as the customers. Indeed, active communication between the company and every stakeholder is paramount to the competitive advantage of an organization as helps in building a value based organization. (Ogbonna & Harris 2006, pp. 163) In building a healthy organization organizational culture component such as trust must be emphasized. An organization that enhances trust between every stakeholder will always achieve quality performance, as it forms the foundation of every communication. Therefore, in this regard trust is the state of readiness for unguarded interaction with someone or something. Indeed Dirks Kurt (2000, pp. 1009) in his argument about trust said that trust have three component, which includes capacity for trusting which calls for an individual willingness for trusting others, perception of competence which includes the perception of an individual’s ability and the ability of others of others with whom the individual interacts with in undertaking his or her duties both diligently and with high level of confidence and lastly perception of intentions. In perception of intention Dirks Kurt (2000, pp. 1009)said that it is the perception of an individual that his/her actions, words directions, missions or decisions are motivated by mutual-service rather than self-centered motives. Research by Dirks Kurt (2000, pp. 1009), and others shows that trust is the basis for everything a leader (management) plans and wishes to introduce in the workplace. Further trust is precursor of the feeling of being able to rely on a person, cooperation and teamwork in a group and experiencing believable communication among individuals. To maintain trust in an organization, the management should avoid by all means breaking trust through high level of integrity. This can be ensured through truthfulness and transparency of communication with every stakeholder (Rashid, 2003, pp.715). Also presence of a unifying mission and vision can help promote and sustain trust. In addition, in an effort to maintain trust the management should communicate the rationale, background and cognation processes behind a certain move or decision as well as maintaining high organization performance. In this regard, people have a tendency of gaining trust in an organization if it has been successful before in some of its projects. If a client have trust in a particular organization in its capacity and capability to meet his or her need he/she is likely to remain to a shareholder of that organization ad even fish more clients for the organization. (Dirks Kurt, 2000, pp. 1009) Just like cultural symbol are component of culture so are organizational symbols components of organizational culture. Symbols in themselves have a meaning attached to it and they usually communicate the information needed to the organizational members whether they are leaders or employees. As such a symbol may be in itself the naming of the organization, logs of the company which acts as the major symbol for the company’s employees or the customers at times. Symbols valuable parts are represented in several ways including as a way of decoration, furniture, pictures colours and many others. Indeed as an overt representation of the companies values, symbols operates in two dimensions which includes to inspire the internal stakeholders for instance the employees in their duties and to market the organization to the external stakeholders who includes the customers and clients among others. This indeed cultivate organization commitment required as argued by Rashid (2003, pp.715). As such the organizational symbols help nature a value-based organization which is dominated by diligence, creativity, trust and competence (Ortega-Parra et al. 2013, pp 1074). This lays the foundations of a fruitful organization which is able to achieve its goals without distractions or roadblocks. Value-based organization which is to some extent a deliberative of organizational symbols drives every stakeholder especially the operating core towards the set goals and objectives, therefore, high productivity. Patriotism is natured through the same value-based organization and, therefore, every member of the organization has the welfare of the organization at heart. Indeed, patriotism created through symbols thus helps cultivate respect towards clients and the general introduction of a caring attitude towards the client by the employees. The client in turn, develops a believe that the organization/company have the best wishes at its heart for him or her. As such, sustainable competitive advantage over other firm (competitors) is progressively created (Rashid, 2003, pp.715). Any business organization operate under distinct culture which affects how people in that particular organization think, feels and behave. As such, behavior is part of an organization and, therefore, behavioral norms which include rule and regulations must be a component of an organization (Janićijević, 2012, pp. 292)The said behavioral norms are always put in place to guide and govern behavior either behaviors of the leaders, employees and any other person affiliated to the organization in one way or another. Indeed, rules and regulations seek to provide order and harmony in the corporate relationships be it formal or informal. Mostly this rules and regulations are documented where they can also be amended so as to respond to the dynamic environment of the organization (Janićijević, 2012, pp. 292).They must provide the code of conduct of any employee towards the client, the management and even towards the other employee. They also have provision of the duties of every organization member describing clearly what they opt to be doing in their capacity for instance security personnel, heads of departments etc. mostly managers and the board of governance who are guided by planning, execution and control principles have the duty of enforcing the rules and making judicial decisions towards one under the organization umbrella who violates the rules. (Reginato& Guerreiro, 2013, pp. 224).The rules are made such that they usually recognize customer or client as the central target making sure that his or her needs are adequately meat. This implies that the client always the king since they justify the organization existence through buying goods and services from the corporate. In addition the said rules and regulation also facilitates good working relationship through close monitoring and guiding the behavior from one employee to another thus ensuring optimum working environment. (Kemp & Dwyer 2001, pp 78)All this aspects including good working environment customer/client directed goals and the division of labor and duties ensures productivity and successful performance of the organization. In turn this contributes to the sustainable competitive advantage of an organization increasing it therefore sustainable existence of the organization. (Janićijević, 2012, pp. 292; Kemp & Dwyer, 2001, pp 78) AS pointed out by Cornelia (2005, PP. 79) Status and role of personnel is also said to be part of an organizational culture. Status refers to the hierarchical position and prestige of an employee within an organization as the other member of the organization usually perceives them. As such, status shows that a person is better perceived, competitive, and influential compared to other members. (Cornelia, 2005, p. 79).This people may be managers supervisors, fellow employees but with high expertise of skills. These individuals act as mentors and peer supporters progressively perceived as sources of inspiration to other employees. They always give advice on matters concerning the performance of the organization helping others achieve their best. Through their support they help raise other experts in the organization thus facilitating organizational success. Indeed they model other employees through observation and therefore ensuring the general success of the organization. Success of an organization translates to the productivity of the firm thus facilitating the competitive advantage of that particular firm over other competitive firms (Cornelia, 2005, p. 79). Conclusion Corporate culture as depicted in this analysis has far reaching impact on the sustainable success of an organization. As seen earlier management and the leadership of an organization which drives the organization has the sole role of initiating organizational culture that is effective in developing and sustaining competitive advantage of an organization. Indeed, it now clear that organizational culture acts as a mother of sustainable competitive advantage of an organization. corporate culture ensure this by closely monitoring and checking the decision making and actions undertaken by each member of the organization as well maintaining high motivation. In conclusion, if a company/firm/corporate must always nature their culture if success is expected. Bibliography: Cornelia Elena, (2005), The Components of The Organizational Culture. ŒCONOMICA, 1: pp 77-89 Crim Dan & Seijts Gerard, (2006), What Engages Employees The Most Or, The Ten C’s Of Employee Engagement. Ivey business journal: improving the practice of management. 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