The Features of Corporate Culture and its Development - Research Proposal Example

Research problem:- For an organization to give its optimum output, the employees should not only be very motivated but also working as a well-functioned and well-oiled machine. The overall objectives as well as the values for daily workings should be very clear. Each employee should have a distinct idea of his own value and should be well aware of his functions. They should also have a proactive approach towards the problems and the functions of the corporate. The leaders and managers of the organization should also take a personal interest in the making of the culture that is flexible for coming changes and at the same time rigid enough to sustain the best qualities of the culture that they have built. The culture that is created in the organization therefore should make sure of these facets and should be able to influence each individual in the most positive way. It should also be an automatically generated culture so that the individuals are ready to accept the positive changes and developments and are able to make them a part of the changing value systems while maintaining the maximum optimization. • What are the most significant constituents of corporate culture? • In what way can the culture of X influence its performance over time? Research objectives and significance:- The research focuses on the features of a culture that shall permeate a corporate and be able to affect all the members of the corporate. The formation and features of the culture should allow all employees of the organization to be idiosyncratic yet to project a united culture. How should such a culture be created and who shall be responsible for the molding of it, are also significant aspects of the research. It is the responsibility of the managers as well as the executives of any organization to look to the formation of such a culture that is enveloping all and allowing features for continuous development. The research will take into account the opinions of experts on the relation between the optimum productivity scenario and the corporate culture as well as how the latter influences in the former. The objectives of the research are to analyze the findings of the Kotter and Hasketts (1992). Their theory is based on three concepts, which are “strong culture”, strategically appropriate cultures” and “Adaptive culture”. The objective of the research is to find whether the three mentioned theories can be implemented to influence the corporate culture. LITERATURE SURVEY:- Journal articles were studied for the purpose of the research that focused on the features of corporate culture, its development as well as its influence upon the over all performance optimization. Marcoulides & Heck defined organizational culture as patterns of shared values and beliefs over time, which produce behavioral norms that are adopted in solving problems. (Marcoulides & Heck 1993) While the culture is developed over time, it is also due to the input of a multitude of people that allows it to be universally accepted within the corporation and later become an accepted code based on ethics the workers act and perform. Kagan, Thornton and Gunningham (2008) are of the opinion that now the corporate structure and employees are going beyond the normal compliance level for creating efficient environments. “It is equally plausible (at least in economically advanced democracies) that differences among regulatory regimes have narrowed sharply, and that local social pressures, market incentives, and corporate environmental management are now the chief determinants of variations in firm-level environmental performance, and of beyond-compliance behavior in particular.” They claim that their great scrutiny of paper mills have led them to some conclusions that is applicable to all, “insights for theories of regulation and corporate environmental behavior, relevant not just to the particular industry sector we studied, but also for other highly regulated, heavily scrutinized, and mature industry sectors, and perhaps for other sectors as well.” Thus they come to the conclusion that “Both our quantitative and qualitative analyses leave us convinced that theories of corporate environmental behavior that focus on a single variable whether legal, economic, or attitudinal – are almost always doomed to be incomplete and inadequate.” Therefore, the cultural aspect of any organization will be developed only through a complete combination of the internal and external factors for it to be viable and sustainable. Rishard L. Daft concludes that there are “four cultural traits – involvement, consistency, adaptability, and mission” (Denison & Mishra, 1995) that form the type of persistent organizational culture that will result in asset return and efficiency of the employees. In the same article, the authors have also mentioned some of the difficulties that they could face while formulating a complete theory for the establishing of a complete, competent culture. “The topic of culture and effectiveness is of central importance in organizational studies, but progress in the development of theory and research has been slowed by a formidable set of research problems. For example, an integrative theory must encompass a broad range of phenomena extending from core assumptions to visible artifacts, and from social structures to individual meaning. Such a theory must also address culture as a symbolic representation of past attempts at adaptation and survival as well as a set of limiting or enabling conditions for future adaptation.” While through out the article the authors have focused on the internal elements that signify and influence the corporate culture, they have come to the conclusion that outlining how a prominent set of values will develop is complex and difficult. Through the work they have presented four hypothesis: “Involvement is a cultural trait which will be positively related to effectiveness. “Consistency, or the degree of normative integration, is a cultural trait that will be positively related to effectiveness. “Adaptability, or the capacity for internal change in response to external conditions, is a cultural trait that will be positively related to effectiveness. “Sense of mission or long-term vision is a cultural trait that will be positively related to effectiveness.” (Ibid) It is an amalgamation of all four of these hypotheses that will allow the culture at the organization to permeate to all levels. Through a test run at different corporations, the authors came to the conclusions that while it is not very easy to simply present a comprehensible culture that will allow for maximum production of the work force, it will have to be a combined effort on the part of the workers and the managers of the organizations to create that culture. Gomez Mejia on the other hand is of the opinion that with appropriate compensation strategies, the corporate and organization can have optimum output by the satisfied and content workers. This, if works as a way of allowing people to feel loyal for the organization, will also help them to give their best to the organization. It is to say that the strategies planned for maximum optimization of the work force should also focus on this particular aspect. “There are several important areas where theoretical development and empirical research is almost nil and that provide fertile grounds for future work on the relationship between corporate strategies and pay strategies.” (Gomez Mejia, 1992) Yet other experts are of the view that the Human resource department of organizations play the most important role in enabling the workers to learn everything form skills to the values of the organization and therefore they can truly affect the culture and atmosphere of the corporate. “HRM practices influence employee skills through the acquisition and development of a firm's human capital. Recruiting procedures that provide a large pool of qualified applicants, paired with a reliable and valid se- lection regimen, will have a substantial influence over the quality and type of skills new employees possess. Providing formal and informal training experiences, such as basic skills training, on-the-job experience, coaching, mentoring, and management development, can further influence employees' development. The effectiveness of even highly skilled employees will be limited if they are not motivated to perform, however, and HRM practices can affect employ motivation by encouraging them to work both harder and smarter.” (Huselid, 1995) He further goes on to conclude that, “Although traditional economic theory would suggest that the gains associated with the adoption of High Performance Work Practices cannot survive into perpetuity (because the returns from these investments will be driven toward equilibrium as more and more firms make them), the substantial variance in the HRM practices adopted by domestic firms and the expectation that investments in such practices help to create firm-specific human capital that is difficult to imitate suggest that, at least in the near term, such returns are available for the taking.” (Ibid) The works and training courses that are undertaken by the human resources at any firm, are therefore, more influential and through these very outlets, a comprehensive and all encompassing culture can be permeated to the whole of the corporate. Denisen and Fay (2003) on the other hand have analyzed the exact rules and regulation of foreign companies working in Russia, and the main focus of the work is on how they have maintained the relationship that allows them to have a very marked effectiveness as well as a very greatly developed culture. While the working environment of Russia differs greatly from the other places, it was a good test to know whether the inner workings and the culture that is developed within and organization will enhance the output of the workers of the corporate. He concludes by explaining: “In an effort to help explain the differences that we observed in effectiveness across organizations, the final stage of the qualitative analysis focused on the most distinctive cultural pattern that we observed, linking functional incompleteness, subcultures, time perspective, and coordination to help explain the differences that we observed in effectiveness. This pattern influences many of the concepts and measures in the model, but reveals a far more fundamental dynamic than we could describe using any single dimension. Combining these insights enabled us to both validate the model and to provide a more complete understanding of the dynamics of organizational cultures in the Russian context.” Sorenson (2002) has expressed his opinions about strong culture within corporation similarly, “While it is possible that strong-culture firms may be better (or worse) at choosing appropriate strategies, theories of the culture effect focus on the positive impact a strong culture has on the execution of routines.” He further goes on to say that, “While organizational cultures reflect past learning, they also define the context for future organizational learning, which, in turn, has consequences for performance reliability. Environ- mental change poses dual threats to reliable performance. First, environmental change can create internal problems by increasing the likelihood of failures in communication, coordination, and control. Second, environmental change can render existing organizational routines inadequate or inappropriate. Such environmental shifts demand learning and modifications in organizational routines that take the new conditions into account. Unless the organization discovers such solutions rapidly, it will perform haphazardly.” The study again reveals that with a rich past, the development of certain culture for an organization also requires that the future be kept in mind and that while confirming to history of the organization, they also adapt to the compete changes and developments that are coming their way. While pointing out the difficulties that might be encountered while generating strong corporate culture he also says, “The value of a strong culture of exploration still depends on the existence of environmental conditions that reward exploration. If the environment changes to reward efficiency and exploitation of organizational routines, firms that are strongly committed to exploration should have greater difficulty adapting than firms with weak cultures of exploration, because such an environment demands relative stability in organizational routines and the ability to make incremental improvements in efficiency. The difficulty encountered by the firm with a strong culture of exploration is, in this case, not an inability to discover new routines but greater difficulty in discovering a set of values and norms that are appropriate to the new environment.” Roberts and Dowling have presented unique ideas, in as much as they assert that the reputation of the firm must remain intact and above reproach for the achievement of fiscal goals, and that should also be a part of the general goal of a strong corporate culture that shall eventually permeate and influence all. “We have demonstrated empirically that a corporate reputation is an important strategic asset that contributes to firm-level persistent profitability. However, there is still much to be done. In respect of reputation, this research has raised a number of important follow-on questions, such as the need to understand and explain the asymmetric time paths of high- and low-reputation firms. Our final recommendation relates to the overall orientation of the individuals providing the evaluations in the Fortune reputation surveys. The reputation data come from firm managers and directors, as well as from market analysts.” If the workers of an organization are working in unison, and are aware of the goals set for their combined efforts, they are most likely to work with more enthusiasm and thoroughness, which in turn will most usually result in a better reputation for the corporate as well as for trust that it has to obtain in open market system. Yet another facet of it is bared by the study, “In the context of both mergers and joint ventures, scholars have generally argued that alliances between culturally similar partners are more likely to be successful than alliances between culturally dissimilar partners.” (Pothukuchi, et. al., 2002) The same also goes for organizations that are scattered around the globe, since all of them have to have different internal and external factors to consider for the creation as well as implementation of a culture. They argue that “Despite different definitions of culture, there is a general consensus among organizational researchers that culture refers to patterns of beliefs and values that are manifested in practices, behaviors, and various artifacts shared by members of an organization or a nation (Hofstede, 1980; Trice and Beyer, 1993). Because organizations are, in many ways, embedded in the larger society in which they exist, research on culture differences of cross-national businesses should examine both national and organizational cultures.” (Ibid) This also goes on to say that the external factors and outward culture is as important as the internal factors and the culture that is supposed to develop in the organization itself. The leaders of every organization must determine the style of culture they want; conduct regular corporate culture assessments; and develop, implement, and manage on an ongoing basis, strategies to make their cultures stronger, more positive, and more aligned with strategic priorities. Proactive leaders identify that the most powerful force they have for accomplishing consistently superior performance is the organization’s corporate culture, and they must manage it strategically Reference: George A. Marcoulides and Ronald H. Heck 1993, ‘Organizational Culture and Performance: Proposing and Testing a Model’, Organization Science, Vol. 4, No. 2, pp. 209-225 Kagan, Robert A., Thornton, Dorothy & Gunningham, Neil, Explaining Corporate Environmental Performance: How Does Regulation Matter?, Law & Society Review, Journal of the Law and Society Association, Vol. 37, No. 1 (Mar., 2003), pp. 51-90 Denison, Daniel R. and Mishra, Aneil K., Toward a Theory of Organizational Culture and Effectiveness, Organization Science, Vol. 6, No. 2 (Mar. - Apr., 1995), pp. 204-223 Gomez-Mejia, L. R. Structure and Process of Diversification, Compensation Strategy, and Firm Performance, Strategic Management Journal, Vol. 13, No. 5 (Jun., 1992), pp. 381-397 Huselid, Mark A. The Impact of Human Resource Management Practices on Turnover, Productivity, and Corporate, The Academy of Management Journal, Vol. 38, No. 3 (Jun., 1995), pp. 635-672 Fey, Carl F. and Denison, Daniel R., Organizational Culture and Effectiveness: Can American Theory Be Applied in Russia? Organization Science, Vol. 14, No. 6 (Nov. - Dec., 2003), pp. 686-706 Sørensen, Jesper B., The Strength of Corporate Culture and the Reliability of Firm Performance, Administrative Science Quarterly, Vol. 47, No. 1 (Mar., 2002), pp. 70-91 Roberts, Peter W. and Dowling, Grahame R., Corporate Reputation and Sustained Superior Financial Performance, Strategic Management Journal, Vol. 23, No. 12 (Dec., 2002), pp. 1077-1093 Vijay Pothukuchi, Fariborz Damanpour, Jaepil Choi, Chao C. Chen, Seung Ho Park National and Organizational Culture Differences and International Joint Venture Performance, Journal of International Business Studies, Vol. 33, No. 2 (2nd Qtr., 2002), pp. 243-265 Read More