organisation - building a positive corporate culture
Richard Bowett develops the concept of business culture and looks at how and why a positive business culture should be an objective of management
The Importance of Business Culture
It took a long time for the importance of business culture to be recognised as an important factor in business success (or lack of success).
Study of Japanese business methods from the 1970s onwards was part of the answer, and Japanese businesses take from Japanese society a strong emphasis on a strong and co-operative group culture in the face of adversity. Solving business problem, and advancing beyond them, is a group responsibility, not just ‘them lot upstairs’. Research into many businesses of all nationalities then showed a common pattern that successful businesses had developed a strong and positive group culture which is about management as leadership and not just administration.
How to Build a Positive Corporate Culture
1. ‘Culture Carriers’. These are key people, usually managers, who represent and spread the core values of the corporate culture.
2. Stability of the group. It is more difficult for a culture to emerge if people are changing all the time.
3. Stories. A group packages up its culture into stories which are frequently told and re-told, and which typify the values of the group eg ‘the time we all stayed late on Xmas Eve to get the last orders finished and then has an impromptu party at the local.’
4. Heroes. Individuals who typify to an extreme the values of the group.
5. Symbols. These may be staff mottoes, the corporate mission statement or anything that symbolises the core values.
6. Rites. These are specific occasions, such as the annual office party, when the core values are publicly displayed. Formal award ceremonies are another example. These are especially important for enculturing new staff.
7. Rituals. This means a standard pattern of behaviour at a specific occasion, such as the office party if things are always done in a particular pattern.
8. Courses. Attending in-house courses is an important way of team-building and communicating the core values.
9. Cultural Networks. This means the informal contacts between employees where they reinforce core values, especially by passing them from older to younger group members.
Types of Corporate Culture
1. Adaptive Cultures. These have as a core value the ability to adapt to change, especially in response to changing external circumstances.
2. Inert Culture. This is a ‘dead’ culture totally unable to change.
3. Networked Organisations. These are very sociable networks of small teams. They are highly creative. But loyalty is low.
4. Mercenary Organisations. These are ruthless business machines dedicated to work and to success. But sociability is very low.
5. Fragmented Organisations. These are really loose alliances of very independent workers, such as lawyers. Sociability and loyalty are both very low.
6. Communal Organisations. These have high loyalty and high sociability. They act like one bog happy family. Recruiting new staff with similar values is important.
Advantages of Strong Corporate Culture
1. Instructions are interpreted in a common way, so work is done to a similar standard and in a similar manner.
2. Loyalty is increased, and replacing workers is an expense to be avoided.
3. Motivation, and therefore productivity, is increased.
4. Management control is increased.
Criticisms of Corporate Culture
1. In a MNC (Multi-National Corporation) there will almost certainly be conflicts between the local national culture and the imported corporate culture. These conflicts are very difficult to manage and there is usually a shortage of managers with the necessary skills in ’multi-cultural management’. For example, in the Middle East family values are very important and an employee wouldn’t dream of staying late to finish work if this conflicted with a family duty. This doesn’t mean, however, that their work-ethic is poor, it is just expressed differently and a Western manager would cause a lot of offence by suggesting otherwise.
2. Businesses are not places with a homogenous culture. Most businesses are too large for people to identify across the whole organisation. Instead, people identify with smaller sub-groups. So a business is, in fact, a mixture of sub-cultures some of which may even be deviant. There is also a strong likelihood of conflict between some of the different sub-cultures.
3. The relationship between a strong corporate culture and improved business performance is, as far as the data can tell, very weak. It may be then that corporate cultures are less about improved performance and more about making the managers feel they have achieved something; a cynic might argue that managers like to be surrounded by copies of themselves.
4. Business is rarely simple, clear and unambiguous enough to allow of one simple message of the kind envisaged by proponents of the corporate culture idea.
Click here for the introductory revision note on corporate culture
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