Importance of Culture in Management Success - Literature review Example

Running Header: Importance of culture in management success Student’s Name: Instructor’s Name: Course Name & Code: Date of Submission: Introduction According to various researches, organisations that foster strong cultures have clear set values which enable firms to achieve their goals since their employees have a reason to embrace the values. According to Burman and Evans (2008) a strong culture is beneficial to businesses operating in the service sector as members are motivated to provide services according to the organisational values. Yes, in order to be successful, culture is the most important thing that should be considered by a business. Even so, it is very difficult for management to address culture due to the recent changes occurring in the internal and external environment. The culture of an organisation is linked to the effectiveness of that particular organisational structure since an organisation with a unique social structure tends to facilitate individuals social behaviour. This study analyses the importance of having a right culture in an organisational setup. The study also shows how managers should address culture once it is introduced to members of the organisation. Definition and application According to Deal and Kennedy (2002) culture is defined in two ways which include defining culture in terms of outcomes and defining it in terms of process. In terms of outcome, culture is defined as a pattern of behaviour in which individuals follows for example in an organisation members would say it is what they normally do or how they do things. It is also shown as a way in which people solve their differences, perform business tasks, and resolve conflicts among members and how employees and customers are treated. In terms of process, culture is defined as a set that link mechanisms that facilitates cross individual behavioral consistency. This shows that culture include the organisational informal values, beliefs and norms that controls members and groups working together in a particular firm. These values and beliefs also promote interpersonal relationships among members working in one environment. There are three functions of the organisational culture that make it more effective in any environment. These include control of behaviours, encouraging stability and providing a source of identity. In behavioral control, culture ensures that members working in one environment under one culture behave according to the values and norms of that firm. The organisation should therefore introduce certain norms in which members should be informed about as the managers ensure that the values are maintained. Organisational culture encourages stability of business activities as members ensure that conflicts and issues are solved using the one concept and which should be applied at all times (Hartnell et al., 2011). Culture also provides a sense of identity for example by differentiating an organisation with another one for example the culture used in a large profit making organisation is far much different from that used in a hospital or in a learning institution. Stephen (2003) state that this is because every activity taking place in the organisation is different including the arrangement of furniture, what the members put on and what the organisation aims at achieving. There are several drawbacks associated with culture and these include one, the barrier to change and improvement. Culture may hinder an organisation from improving since change in that firm will not be adapted as fast as possible. Managers should therefore ensure that the culture introduced is well implemented and employees should be given time to adapt to the new system. Culture also causes barrier to diversity. This is because members are used to doing one thing all the time and therefore their mentality is not free to diversify and try out several strategies of improving their organisational performance. Jex and Britt (2008) show that organisational culture also has barriers to cross departmental and cross organisational cooperation. Most organisations fail to cooperate due to the traditional norms and beliefs that the company value for example if a member tries to change the set up of an organisation then this might lead to organisational issues. Culture also has influence barriers to mergers and acquisition in that an organisation that has been valuing working alone and not partnering may avoid merging with other firms and therefore lack of diversity. According to the outcome approach of defining culture, culture can be defined in terms of variables such as innovation versus stability. This is the level at which members in a firm encourage innovation and the level at which these members are capable of taking business risks in order to ensure that the organisation meet the expected objectives. Johnson (1998) describes that culture is also described using outcome versus process orientation. This is described as the level at which managers in any business tend to focus on the outcome of the business, the goals to be met and the final results which include profits or losses. Managers should instead try to focus on the aspects of management that enable the business achieve success. Some of these factors include improving techniques of management, developing diversified business processes and introducing strategies that best suit the business. Culture is also described by variables such as strategic versus operational focus. This is described by the way managers tend to focus more on the long term success of the business rather than improving the operational activities that improve success (Montana and Charnov 2008). Management also find difficulty in managing the culture around their work environment because they the work activities are organised around the teams and rather than managing one individual at a time. This is because individual analysis enables managers to evaluate performance effectively and it is also easy to manage one person as compared to a team. Managers also face difficulty in managing culture because they mostly focus on achieving the needs of the customers. Stephen (2003) argues that instead managers should manage organisational culture and should ensure that the needs of customers are met at a minimum cost. Most organisations also pay more attention to the internal environment which includes working conditions, employees, satisfaction and attaining customer value. However, to effectively manage organisational culture, managers should ensure that they adapt both to the internal and to the external environment. This is achieved by introducing strategies of beating the market competition and also competing with the global market. The culture of an organisation may be reflected in various forms which include the physical infrastructure of a firm, the routine behaviour and language used in the business and also through gender equality or equality in payment systems. Hofstede (2000) describes that dominant factors such as the quality of products and efficiency of an organisation can also be used to describe culture. Other firms use philosophies as a form of describing culture for example there are firms that believe that the customer is the king and others state that the customer is always right. The formal components of organisational culture include mission and vision, policies, procedures, rules and organisational development. The mission and vision describe the milestones that the organisation is planning to reach and the effect of this on the organizational culture is that it could be unrealistic where management set a higher level. The policies are the guidelines that show members of a firm how to maintain organisational behaviour and if not drafted properly and if employees are not involved then they tend to provide leeway. Procedures include the methods that provide specific guidelines and the effect they have on the organisational culture is that they can create obstacles if not properly implemented. Rules give specific organisational instructions before performing a task and they could be a mean or an end depending on how they are communicated to the employees. O'Donovan (2006) suggests that the state of organisational development include the stage at which the business is for example if its growth, maturity or declining stage. This stages pose a direct impact on the organisational culture for example a firm that is in its early stages may have to use more strategies in order to ensure that employees adapt to the introduced values and beliefs. Factors influencing organisational culture According to Phegan (2000) the factors affecting culture in business include the paradigm. This includes the purpose of the organisation, the services offered, its mission and values. Managers should ensure that these components are well implemented into the business environment in order to maintain the organisational culture. The other factor influencing culture includes control systems. These are processes put in place for monitoring and evaluating the activities of a firm. These systems are able to achieve success once they are properly managed. Organisational structures are also factors influencing the culture of an organisation. These include reporting lines, organisational hierarchies and how work flows. Managers should ensure that the hierarchies and the reporting lines are well maintained and should be clear to the employees for them to know who to report to once faced with business problems (Harris 1994, pp. 308-321). Power structures is the other factor that influence culture and is described by the manner in which organisations plan who makes final decisions around their workplace. The power should also be in such a way that it is spread around the organisation. Managers however should not use their powers to de-motivate employees but should use it for instilling discipline and ensuring that business objectives are attained. Parker (2000) describes that symbols used in various organisations also influence the culture of the firm these include logos and designs for example the symbol of the Red Cross has been used by the movement for many decades and it is used to define the culture and the purpose of the organisation. Rituals and routine for example management meetings, board reports may influence the culture of a firm both positively and negatively. Negative rituals include those that may become habitual yet they have no benefit to the business and positive rituals and routine include those that solve organisational issues this contributing to success in business. The final factor influencing organizational culture includes stories and myths that people build up around the business environment. Such myths and events may convey a message about what the organisational value or belief and therefore it is necessary to ensure that new employees to the business are given orientation about the organisational culture. There are two significant reasons that show why culture develops in an organisation. The first reason is for external adaptation and the other is for internal integration. Handy (1995) describes that external adaptation shows an evolutionary approach used to analyse the organisational culture. This describes that culture develops and persist due to enabling the organisation survive in the external environment and to have a competitive position in the market. This approach also suggests that culture is a valuable factor that enables an organisation achieve its objectives. It also shows that culture is one factor capable of generating sustained and successful competitive advantages. According to Charles and Gareth (2001) the internal integration of the business is necessary as it creates interpersonal relationships. Social structures are necessary in any business as they enable the business to exist and therefore practices around the organisation are learned as a result of workplace socialisation. The internal environment reinforces culture for example by every day encouraging employees to exercise the cultural values accepted by the firm. The organisational culture is shaped by various factors such as the environmental environment, industry, nature of workforce, technologies used around the environment and the organisational history. Schein (2005) suggests that role models around the organisation also influence cultural values and it is necessary for leaders and managers to ensure that they observe the values and norms of the business for the employees to follow. The founder of the organisation influences the development of culture since they normally have control over hiring. They should therefore ensure that their workforce consists of individuals with the same values and who are capable of influencing the strategic choice of the firm. Conclusion Culture is truly the most important thing to consider in achieving organisational success. This is because it defines the kind of goals and values that members should aim at pursuing. It also gives ideas on the appropriate standards of behaviours that members should observe in order to achieve organisational goals. Organisational values develop norms, guidelines and expectation that every business have. However, culture can be a necessary evil if it is not well managed. Managers and leaders should therefore ensure that the culture introduced in a business environment is effectively managed and implemented for every member in the organisation to follow. Control and evaluation systems should also be introduced to ensure that the culture used is able to obtain the maximum benefit expected by the firm. References Burman, R & Evans, A 2008, Target zero, A culture of safety, Defence Aviation Safety Centre Journal, pp. 22-27. Charles, H & Gareth, R 2001, Strategic management, Houghton, Mifflin. Deal, T & Kennedy, A 2002, Corporate cultures, The rites and rituals of corporate life, Harmondsworth, Penguin Books. Handy, C 1995, Understanding organisations, 3rd ed., Harmondsworth, Penguin Books. Harris, G 1994, Organisational culture and individual sense-making, A schema-based perspective, Organisation Science, vol. 5, no. 3, pp. 309–321. Hartnell, C, Ou, A & Kinicki, A 2011, Organisational culture and organisational effectiveness: A meta-analytic investigation of the competing values framework's theoretical suppositions. Journal of Applied Psychology, vol. 2, no. 3, pp. 20-32. Hofstede, G 2000, Culture's consequences, International differences in work related values, Beverly Hills, CA, Sage Publications. Jex, M & Britt, W 2008, Organisational psychology, A scientist-practitioner approach, Wiley, USA. Johnson, G 1998, Rethinking incrementalism, Strategic Management Journal vol. 9, pp. 75-91. Montana, P & Charnov, B 2008, Management, 4th ed., New York, Barrons Educational Series. O'Donovan, G 2006, The corporate culture handbook, How to plan, implement and measure a successful culture change programme, London, The Liffey Press. Parker, M 2000, Organisational culture and identity, London, Sage. Phegan, B 2000, Developing your company culture, A handbook for leaders and managers, California, Context Press. Schein, E 2005, Organisational culture and leadership, 3rd ed., Michigan, Jossey-Bass. Stephen, J 2003, Entrepreneurial organisational culture, Construct definition and instrument development and validation, Washington, DC, The George Washington University. Read More