Developing Corporate Culture
Developing corporate culture’s study will provide a detailed understanding of the importance of the corporate culture in organisational success and the managerial skills to influence the achievement of the culture. The development of an appropriate culture is vital to the organisation’s success. It could be said that all the best policies, procedures and technologies are supported by a culture that reinforces consistently what the organisation is all about.
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This study will explore the work that has already been carried out to develop an understanding of both national and organisational culture dimensions. This understanding will allow them to consider how this affects their interaction with different stakeholders from different culture group. Although it is underpinned by an exploration of relevant theory, the intention is that the study will be applied to specific organisation and situation. A very important part of this study is stakeholders, any group or individual that can affect or affected by the achievement of organisational goals, such as managers, stockholders, work groups, suppliers, distributors and customers. This detailed study of DCC will provide essential knowledge of the subject.
1.1 Organisational culture and Organisational Objectives
Business objectives are the ends that an organisation sets out to achieve. Organisational culture is the main aspect of any business to achieve these objectives. An organisation must create an effective culture and business plans to enable it to achieve these ends, thus plans and organisational culture are the means to the ends, to achieve the organisational goals. The objectives and plans that an organisation creates are determined by balancing the requirements of the various stakeholders in the organisation. The stakeholders are those individuals and groups that are affected by and have an interest in how the business is run and what it achieves.
Every business has a range of stakeholders. The objectives that a company establishes are based on blending the various interests of these stakeholder groupings. For example, an objective to be the market leaders will benefit all stakeholders because customers will receive high quality products, shareholders will receive high dividends, employees will receive good wages, and so on. (James L H and John P K, 1992) indicate that corporate culture is the biggest influence to the performance of the work force. It may sometimes inhibit long-term financial performance. It was suggested how managers can work at reversing such a trend. In particular, managers wasted little time and energy on people or products or plants that seemed to have little long-term potential, by creating systems that tracked non-financial data which were also sometimes able to demonstrate credible progress in even less time. Thus, the strength of cultures, their adaptability and their environmental fit as key predictor of their financial performance. (R Harrison & H Stokes; 1992) clarifies that “Culture impacts most aspect of the organisational life, such as how decisions are made, who makes them, how rewards are distributed, who is promotes, how people are treated, how the organisation responds to its environment and so on.”
All this different factors combined to create a successful and popular corporate culture for the organisation which will result in to the immense success in long term, in terms of both, financially and socially. The organisation will raise its status in the competition resulting financial gains and at the same time it will become popular amongst the employee which will allow them to create a very good social image. There are many different models of organisational culture is available. To name a few, Entrepreneurial structure and power culture, Bureaucratic structure and role culture, matrix structure and task culture, Independence structure and person culture etc. The best example is Johnson’s cultural web of organisational culture. The image shown here explains what the culture includes:
This model is called the ‘cultural web’ though it looks like more of a flower than a web. The paradigm in the centre is the set of core beliefs. Let me clarify what is a paradigm. A paradigm is a constellation of concepts, values, perceptions and practices shared by a community, which forms a particular vision of reality that is the basis of the way a community organises itself. (Capra 1997). This will take place from the multiplicity of conversations. It will maintain the unity of the culture. The ‘petals’ are the manifestations of culture which result from the influence of the paradigm. Almost all of the change programmes will concentrate on the petals; trying to effect the change by looking at structures, systems and processes. Initiatives usually have a limited success. A lot of energy and money is put into the change programme, with all the usual communication exercises, consultations, workshops etc. In the beginning things seem to be changing but gradually the novelty and impetus wears off and the organisation0 settles back into something like its previous configuration. This will happen in the most of the cases because of a very simple reason that unless the paradigm at the heart of the culture is changed there will be no lasting change.
Harrison and stock mentions that Culture impacts most aspect of the organisational life, such as how decisions are made, who makes them, how rewards are distributed, who is promoted, how people are treated, how the environment respond to its environment and so on. It is very important to understand how this different aspects of the culture help to achieve the organisational objectives. Treating all employees equally will create a very healthy environment for work. A healthy environment means harmony and co-ordination in work, good level of communication and consistency in achieving the organisational targets. This is what an organisation would ideally want from the workforce.
At this point, a very important topic is also related to the success of the organisational culture and that is the difference between organisational culture and national culture.
1.2 Organisational and National culture
Based on the research of Dr. Geert Hofstede,(www.itapintl.com), there are differences between national and organizational cultures. For global companies, it is important to understand both in order to impact organizational performance. Our national culture relates to our deeply held values such as good vs. evil, normal vs. abnormal, safe vs. dangerous, and rational vs. irrational. National cultural values are learned early, held deeply and change slowly over the course of generations as witnessed in all ages. The organizational culture is comprised of broad guidelines, rooted in organizational practices learned on the job. Experts agree that changing organizational culture is difficult and takes time. When two or more companies merge/integrate is how the underlying personal values of employees impact how they perceive the corporate culture change efforts. People can learn to adapt to processes and priorities, and a person can be persuaded to follow the exemplar behaviours of leaders in an organization. But if these priorities and leadership traits go against the deeply held national cultural values of employees, corporate values processes and practices will be undermined. What is appropriate in one national setting is wholly offensive in another. What is rational in one national setting is wholly irrational in another. And, corporate culture never trumps national culture.
1.3 Analysing the corporate culture
British Airways is operating a highly effective bureaucratic structure and role culture. At British Airways the organisational culture is to constantly work towards creating an inclusive culture that understands and respects the individual differences of each employee. British Airways seek to deliver a service which reflects and responds to the diverse range of customer needs with an aim to drive and integrate diversity into all aspects of the service to remain competitive. As a company which operates globally, BA needs to attract and retain talented individuals to reflect the diversity of customer base. Employing a mix of people from diverse backgrounds leads to potential new ideas and innovation.
BA’s strategy is driven through diversity champions representing departments across the airline and employee groups which meet regularly to discuss issues on religion, disability, flexible working, sexual orientation and ethnicity. Diversity issues are communicated to employees via corporate intranet site, diversity forums, diversity employee networks, company newspaper and in monthly newsletters. The organisational culture describes all the rules, practices, attitudes and beliefs of business and underpins the interactions of staff and customers. Organisational climate describes the morale and perceptions of the organisation and is quite subjective.
At British Airways the current climate is not harmonious between the staff and the management. As a result the organisation is facing a lengthy unrest resulting in to the walkout of the staff which coasted company a whopping ?150 million. This dispute will be the biggest obstacle in company progress to achieve the organisational objectives. The main source to achieve any company target is the workforce. If the work force is not satisfied, they present a real threat of obstructing the progress of the company. (Mullins 2002) clearly described that Organisational climate is relating to the prevailing atmosphere surrounding the organisation, to the level of moral and the strength of feelings of belongings, care and goodwill amongst the members. Organisational climate is based on the perceptions of members towards organisations. Hence it is clearly noticeable that the current management at BA has failed to gain an edge over member’s perceptions. The work force is disputing from a long time and it is clearly obstructing the organisational goals.
BA is committed to achieve highly professional goals through their different future commitments. The Colleagues at BA are engaging themselves to make British Airways a high performance workplace; by focusing to deliver consistent customer service; by developing and maintaining world-class partnerships with all key stakeholders, both internal and external; to create a performance-based culture. BA is also committed to an Operational efficiency by driving continuous improvement, short and long-term. This work is led by the Leadership team which involves and engages employee right across the organisation. But the current climate will definitely not allow these commitments to become realistic. Although recent improvements between union and management is showing some positive signs which is an indication of good times coming back to BA.
There are many different departments in BA. At some level, the different departments operate with independence structure and person culture. As mentioned earlier, his structure is based on the individuals who are responsible for their work. For instance, the cleaning department, work on terminals. Although this department have a manager and supervisor but most of the staff knows their responsibilities and knows exactly how to perform them. They hardly need the information of everyday work as they are accustomed of it. Between the staff members, the power and influence are shared with strong individual values. This is also a very effective organisational culture.
1.4 Organisational culture’s Impacts
The organisational culture combines the areas of different potential misunderstanding such as communications, management and negotiations. Moreover buyer behaviour, cultural shock, importance of developing cohesive culture in merged organisations is some of the different factors which clearly impacts on achievement of organisational objectives. Stewart mentioned that “in recent years attention has shifted from the effects of the organisation on work of people’s behaviour to how behaviour is influenced by the organisation culture. What are much more common today is the widespread recognitions that original change is not just, or even necessarily mainly, about changing the structure but often requires changing the culture too.” The impacts of organisational culture are many and varied depending on whether the company has a strong culture or a weak culture, but there are some generalities that apply. Most of the time some positive effects will occur no sooner a company makes a concerted effort to establish a strong positive organizational culture at the work place. Many workers are spending more and more time at work entirely depending on the job or company. The old axiom goes that a happy worker is a productive worker, and this is one of the effects of organizational culture. Workers want to enjoy work. They want to be interested in whatever is going on during their work span, or long term goals. Being part of something meaningful will make the worker enjoys which will change whole experience of work better. This will make them more productive. The effects of organisational culture should help providing such kind of settings. A strong organisation must be focusing on the environment it creates for its workers. This is because that will help encourage a more efficient and productive organisation. Focusing on building and sustaining organisational culture shows employees that they are considered an important part of the company. Such type of company generally has among the best response from its employees and thus will also have a much better chance of achieving its goals.
There are five major reasons for wanting to create an appropriate and positive organisational culture for your company: A strong organisational culture will attract high level talent It will also help to keep the top level talent. It creates energy and momentum. A strong and successful organizational culture should alter the employees view of work. It will also help make everyone more efficient and successful. A strong organizational culture can breed success, and its importance should not be discounted.
2.1 Climate of Organisation
British Airways is a very well-known organisation. It has been renowned for its organisational culture. BA provides the best opportunities to the staff members including many benefits and packages to enjoy. But from last few years it is experiencing workforce unrest. The main reason for that is there is a change within the management psyche at BA, driven by the chief executive. The new management team had taken some tough decisions which were not liked by the staff members. The management took away travel perks and also did not implement any increment for two years. These actions resulted highly unpopular and caused heavy colleague unrest. Thousands of staff took part in 22 days of walkouts last year, which cost BA ?150m. But now there are some positive developments. BA cabin crew voted this week to end 18 months of strife, which is sign of good times coming back to BA. The agreement includes a two-year pay deal and the return of travel perks for staff who took part in walkouts last year. British Airways cabin crew voted on a peace deal that could end the airline’s worst industrial dispute. The Unite trade union posted ballot papers to crew. It is with a letter from its general secretary recommending a vote in favour of the agreement 18 months after Unite opened its first strike ballot on the dispute. So far the only indication of support for the deal is approximate, after hundreds of crew attending a meeting at Heathrow airport this month backed a proposal to put the deal to a wider vote. BA is hoping for the best outcome of these positive talks and are keen to end this worst industrial dispute.
Source: The Guardian
2.2 Ways to improve corporate climate
There are many different factor included in organisational climate. Some key factors are flexibility, responsibility, standards, rewards, clarity, team commitment, management practise, efficiency and effectiveness. All these have a clear impact in creating a healthy climate for workforce. Organisational climate might need to change to adapt the current changes in the business. There are many different ways of improving the organisational climate. Sometimes it is important to recognise improve may mean change because a particular climate is no longer appropriate. It is very important to understand which climate is required, different management styles, effective communications and rationale and continual review. Generally a healthy organisational climate will contain the integration of organisational goals and personal goals. The most appropriate organisational structure based on socio-technical system. Mutual trust, consideration and support amount at different level of the organisation. An open discussion of conflicts with an attempt of avoiding confrontation. Managerial behaviour and styles of leadership appropriate to the particular work situations. Acceptance of the psychological contract between the individuals and the organisation. If any organisation contains all the above mentioned in their culture, the work climate will be at its best.
2.3 Organisational Values
It is becoming increasingly important to growing numbers of organisations to let the individuals experience a sense of purpose at work and to work for an organisation that puts organisational values into practice. Personal values, which can be defined as “Underlying and relatively stable dispositions which organisations use to guide their actions and decisions and to help them make judgements about what is right and wrong” can only be the product of upbringing and socialisation, with purely individual differences stemming from personality characteristics also having a bearing. In adult life it is often a worthwhile process of self-development to spend some time clarifying one’s values: reviewing and reflecting on what is really important to you in an enduring way. It is not really a meaningful thing to choose values. The new organisations emphasis on value leadership; i.e. leading through establish leadership. The frame work for developing and supporting strong corporate core value is to integrate values in HRM strategies, recruitment, progression etc. Solutions about how to deal with a new task, issue or problem based on reality values that work become belief and justify actions and behaviours.
3.1 Stakeholders of organisation
At British Airways, their main stakeholders are its Workers. BA provides them with their daily bread and butter. The workers always want BA to do well because the company pays their wages which help them to pay their regular monthly expenditure, other expenses and their mortgages. The other most important stakeholders are its shareholders. They always want BA to do well because they own the company and want their investments to increase in value. They want to get paid regular dividends and other benefits. Moreover BA suppliers are also very important stakeholders of the organisation. They make money from supplying BA with goods and services. BA buys everything from food to fuel to entertainment for customers. Suppliers want BA to do well so they can continue to make a profit. And last but most important stakeholders are the customers. Many business customers fly the same route on a regular basis. They want BA to do well so they can continue to use their service. Customers want to enjoy many benefits that BA offers including frequent flier, BA Holiday sale and many more offers which coming on regular basis. So this can be said that The workforce, shareholders, suppliers and customers are the main stakeholders of BA.
3.2 Organisations communication strategies
Culture and communication can’t be separated. For us to communicate and cooperate, we must share some common assumptions about the world we live in and some common standards by which to judge our own and each-others action. There are three main types of communications. Written, verbal and non-verbal, this can be communicated in three different ways across the organisation. The first is downward communication. From top to lower bottom in hierarchy which are often unclear and disorganised. Upward communications flow. This allows the flow of communication and information from a lower level to a higher level Prone to distortion as people lower in the hierarchy wants to present them-selves in the best light filtered information and people high in the hierarchy do not want the feedback, suggestion or criticism. The third is Horizontal communication. This means coordinating activities; sometimes this is difficult as communication usually occurs up and down the hierarchy or the restriction of the information due to the competition. Any of this communication strategy can be used effectively to create a successful organisational culture with the best climate for the workforce.
Customer satisfaction and the opinion of all stakeholders are keys to defining BA’s success. British Airways understands the stakeholders – customers, opinion leaders and employees – to better inform business decisions. Therefore, in-depth and thorough measurement and research are in place to provide this important information. The British Airways measure Customer satisfaction which is monitored by a comprehensive and detailed on going survey, which measures reaction to all the aspects of the service throughout the journey experience that are important to customers. The survey was constructed with help from NOP, one of the world’s leading experts in customer research, and was tested extensively with customers before it was launched to confirm that it was as relevant, clear and unambiguous as possible. Source: British Airways.com
3.3 Communication Strategies:
BA believes it is important to share customer feedback as widely as possible throughout British Airways in order to maintain focus on the customer. Results are available on the Intranet, in the research library, and through electronic presentations and display boards. Customer insight is presented regularly to the company directors and to managers throughout British Airways. This how both customer satisfaction and other research, such as advertising effectiveness tracking, and summarises trends in customer satisfaction and behaviour, and performance issues in different areas of the business. Where appropriate, British Airways have also advised departments on the setting of targets for customer satisfaction performance in order to encourage improved service delivery. Over the past year customer insight has been used to support a range of product and service initiatives. These include: Evaluation of more cost effective meal option. Recommendation of improvements to service routines on very long flight route, Evaluation of technical developments to provide customers with greater flexibility and control when making their booking and check-in. Evaluation of different type of on board seating configuration in addressing the need of short-haul customers. Reorganisation of resources in some of the airport lounge to provide customers with a more comfortable experience and evaluation of the success of the customer relation’s service recovery across different channels and method of complaint handling. All this are different strategies of improving the communication and reforming a strong strategy without any weaknesses.
After comparing many authors’ theories, it can surely be said that developing corporate culture and maintaining a healthy work climate are the most important factors of the organisation success. It provides the path to achieve the organisational goals by maintaining a skilful staff with the desire to develop further. Now the trainings can be given at employees own pace rather than forcing it to them and moreover they don’t physically need to be there in the classroom to get train. It can easily be assessed on internet and can be completed in their convenience. Internet based learning can be called an electronic library designed to share information. But given a detailed look one can realise its potential extends far beyond that. They can be the agent of change creating a more effective and connected workplace. We have always known the powerful effects of rapid, relevant, and specific corporate culture. This makes it far easier to implement the health corporate culture at all level of training and development initiatives.
Corporate Culture and Performance; Kotter, John P.; Heskett, James L.; The Free Press; 1992; p. 99
Harrison, Roger & Stokes, Herb (1992) Diagnosing Organizational Culture. San Francisco: Pfeiffer.