Importance Of Organizational Culture To Understanding Business Essay

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Today, competing in business life is getting more critical issues. However, people are looking to find their own strategies, critics, know how and other concept, which might help the organization to win the competence a little bit more. As well as, people are facing more demanding, challenging working tasks. Therefore the organizational needs a organizational culture will be needed in order to manage people's mind into the same line.

Organization culture is also involved as strategic management. In fact, managing the right organizational culture is a critical issue as well. However, the leader's decision and action shapes the firm's organization culture too. Organizational culture refers a complex set of ideologies, symbol as well as the core value. This will influence the worker's perception, feeling, action and believes. The thoughts share throughout the organization, which will also influences how the firm conducts their business. (Michael 2011)

The organizational culture has become an age. And why is it have been used as an organizational strategy for so long time? The answer is because it is important for company to have it's own organizational culture in order to operate effective and efficiently. As well as to manage, such as planning, organizing, leading and controlling in more easy way. Today, the globalization is increasing the opportunity of the threats, therefore making the culture more important for each company (Richard, M and Andrews, T. G.).

However, the organizational culture is know as the mindset which the group of people think something in the same perspective, on the other words, the people's perception towards their work and the environment. Such as their vision, mission, motto, and the way of thinking and the solutions which they need to evaluate. For example, when the project team meets the problem to choose one solution from the two, all of them will know which to choose because they have the same perception that illustrates which solution will benefit them more.

As we can see, to have the same culture will lead employees to solve problems more accurately, which can bring the corrects choices for the organization.

What happens to the organization is easy to observe, for example, leadership failures, marketing myopia, arrogance based on past success, etc. And why these problems will happen? The organizational culture will be the solution to understand the issues (Schein 2003).

Although the culture is powerful, it sometimes could be abstraction. Here is a true story as an example. Mr. Schein has called by a management group from Digital Equipment Corporation (DEC). To help them improve their communication, interpersonal relationships and decision-making. After he attempts several meeting, he realized that the group has four problems. (1) Have high level of interrupting and confronting and debate; (2) Excessive emotionality about proposed action; (3) Great frustration over the difficulty of getting a point of view across; (4) A sense of every member of the group wanted to win all the time. And after several months, he had suggested better listening, more ordinary process of the agenda, the potential negative effects of high level of emotionality and conflict, and need to reduce the frustration level. The group member said that his advice was very helpful that they modified certain aspects of their procedure. For example, they scheduled more time for certain meetings. However, the basic pattern did not change. No matter what intervention he attempts, the group style did not change (Schein 2003).

Within the last 10 years or so, many organizations seem to have implemented positive climates such as staff welfare, benefits and loyalty and so on. For example, the employee will get complimentary trip when they have worked for more than 2 years. The other example is that the employee's bonus amount will increase accumulate; the second year will be 110% of the previous year. However, the organizational culture does not entertain employees, if it is only to help their work and business condition. The organizational culture will only reduce the dissatisfaction and doe not provide any satisfaction. Which means it does not increase the motivation factor but only reduce the problem factors which decreases their motivation.

However, it has been documented that the organizational climates will influence hugely about the employees subsequent motivation and attitudes towards their work in both organizational level and individual level. However, with the current economic climate situation, it has been the worst in past 60 years. And therefore people raised a number of questions about how to develop and sustain the positive organizational culture during this difficult time (Wilson, D. C).

One key aspect on cultures impacts on work outcomes such as well-being and performance is the mediating role of cognitive and affective states. This report attempts to draw upon a recent body of literature from Fred Luthans and his colleagues (Luthants 2002) on developing and managing positive physiological states, known as positive organizational behavior. By doing so, this report should say that organizations are now have to investigate more on wellness type program that promote a positive organizational culture. In order to demonstrate that organizations are both committed and care about their employees (Neal and Mark and Seleste 2011). For example, all employees are provided annual complimentary body check.

The organizational culture is also necessary as strategic management. However, the organizational culture functions as a kind of control. The strategic managers can influence the kind of values and norms that specify appropriate and inappropriate behavior in the organization. Which makes the leader to shape and influence the way people behave in the company. For example, at Microsoft the innovation and creativity are stressed. They established and tell all the employees that they should be innovative and creative even there is a possibility of failure. Therefore all the employees have these two mottos in their mind on everyday work (Charles and Gareth 2012).

The strategic leaders who are responsibility for strategic management are divided into different levels. Usually there are three levels of strategic management. From the top, corporate-level, business-level and functional-level. And people in the each level have different tasks on the organizational culture.

Corporate - Level managers includes chief executive officer (CEO), senior executives and the corporate staffs. These people's task is to set the organizational goal, vision, mission and believes and so on. For example, in the Apple company, the mission statement were set as 'Man is the creator of change in this world. As such he should be above systems and structures, and not subordinate to them' (Steve, J 1980). Since CEO, Steve Jobs set the mission, therefore his follower has the mindset that they have to be creative. Therefore it is important for corporate level to set the organizational culture in order to give subordinates the guiding.

The organizational culture set by in this level, also helps the follower level, business-level's planning and controls.

Business - Level managers are the strategic leader in their business such as business manager and vice president. These managers manage the strategic management processes.

People in this strategic level are needed to have the culture to help them to plan, organize, lead and control the followers. The culture adopted here should be provided by the corporate-level. For example, from the corporate-level, the culture is set as to be creative. Therefore these people should be supporting the followers to think creative. For example, they can change the environment of the office in order to provide more space for employees to invent ideas.

Functional - Level managers are the strategic leader of the specific function such as marketing and operations manager. Usually functional-level manager manages the strategic process on this level. The functional manager generally needs the culture to help them to coordinate the workers such as their team works and the efficiency. However, although the functional managers are not likely to decide with the organizational structure or organizational culture, but it is important that they understand how these decisions impact on reporting-relationships, decision making and the commitment on their projects (Timothy, J. K. 2012). For example, in the Human Resource department, the organizational culture can be useful. However, when the company recruits new employee, it will be a guideline that what people to hire. As from the Steve Jobs' policy, the new employee should be a creative person that he/she is good at inventing new ideas.

Working in an organization will usually reflect to working in the group. However, the jobs are increasingly becoming complex, more demanding and challenging. A culture of teamwork will make people more comfortable as they know that they have the team supporting in their discharge on their duties. As well as the more people, the more ideas, skills and knowledge as well (Milind, T. P. 2011).

On the other hand, the problems that we face when we work in the group are many also, because each person's background is different from each another. Such as their religion, perception, experience and the most importantly, the way people think is different. Therefore we need to evaluate the company's culture in order to get people's mind organized for the same organizational goals and objectives (Champion, B. A.2007).

Although the organizational culture for each company, setting the right culture is another difficulty that leader will meet. The positive organizational culture can be characterized by its values such as openness, friendship, collaboration, encouragement, personal redeem and so on. With the tend to lead to evaluate the employee cognitive and affective involvement with organization (Celeste, P. M. W. and Neal, M. A. and Mark, F. P. 2011). However, once the organizational culture is published, it tends to persist and can be a major strength if it is consistent with the organizational strategy. In the absence of the established scale, the firms usually fail to identify the best corporate culture.

However, the best way to judge the relevance and the suitability of a culture is assess the support it offers to the purpose and strategy of a company. There are variety method of developing maintaining and changing the organizational culture. However, changing organizational culture is a very difficult task. Because it can be done at all, since it will need a long time to complete. The most effective methods of reinforcing the organization's culture are:

How managers pay attention, measure as well as control.

The way managers react to critical incidents organizational crises.

Managerial roles in modeling, leading and coaching.

How they measure for allocating rewards and status.

How they recruit, select, promote and remove from the organization.

For example, in the case of the employee get promoted. And it is not because of his/her quality in their job, but for the reasons other than the formally espoused or commonly applies for ones. Therefore, the feeling of injustice that such promotions invoke within and among bystander employee is something many employees have experienced. This kind of way that managers promote people will have negative impact on their company (Mark F. P. and Neal M. A. and Celeste, P. M. W. 2011).

In addition, rites, rituals, events and ceremonies can maintain the organizational culture (Sahaf 2008).

Besides on how to measure the organizational culture, we have to be aware on what influences the culture as well. There are two factors that can influences, one is Internal Factors and the second is External Factors.

Organizational culture is subjective by number of factors, which affect its
results. Which is the outcome of features that act on the behavior of employee's reaction towards their customer, working condition and manager's leadership. To make sure that weather employee is motivated and committed, company have to identify the external and internal factors which may have affect the behavior. Internal factors consist of organizational structure, corporate culture and leadership (Wilson, 2003). On the other hand the External Factors involve Environment, business relationships and family life in this case.

Internal - Organization Structure: The organizational structure includes procedures and policies and so on. The good organizational structure makes it possible for employee to be motivated, creative and efficient. On the other hand, bad organizational structure does not support employees to realize on their potential.

Internal - Corporate Culture: Company's organizational cultures which cannot be described comprise its business culture. For example, Starbucks corporate culture states cheerful atmosphere, friendly service and employees can choose the flexible working hours on their own. Alternatively, the local police culture is different from Starbucks, police stations are focusing on protecting people and getting things done.

Internal - Leadership: in any organization, the leadership is very important role. If the employees are very good trusted in leadership, the organization is more likely to success. However, when the staff feels the leadership is honorable, can be trusted and full of integrity, more likely their productivity will improve. As a result, the organization will be recognized for its quality of the leadership and likely to success.

External - Business Relationships: business relationships also have a great impact on employee's behavior. For example, if an organization has its business partner with a further business with higher expectation, then their workers will also react in their work as the reason of those high expectations.

External - Environment: As the external factor, macro-environment which influences organizational culture is known as PEST analysis. The PEST analysis consists of Political, Economic, Social, and Technological factors of the external macro-environment. The reason why it is called PEST analysis is because these external factors are out of organization hands. Political analysis includes political stability, frequent trading partners, anti-trust laws, legal framework for contract enforcement, pricing regulations and so on. Economic Analysis includes interest rates, economic growth rate, labor costs, exchange rates and stability of host country currency, government intervention in the free market, the quality of infrastructure and so on. Social Analysis includes education, demographics, entrepreneurial and so on. Technology analysis includes rate of technological diffusion, impact on cost structure, recent technological developments, impact on value chain structure and technology's impact on product offering etc.

Therefore it is not only setting the right culture is the problem but it will be necessary to consider the internal factor and external factor as well. As we now know that the organizational culture is a tool to encourage followers to work more comfortably as well as effectively. But other than these, we are going to go more detail on how the organizational culture will affect the people's organizational behavior.

One of the major influential features of organizational behavior is ethics and values of the individuals, which involved in the organization. The policies and values of the organization in various conduct are related in the effectiveness on the individual. Organizational culture affects such results like self-confidence, ethical behavior, performance, commitment as well as the productivity. When the individual enters in an organization, he/she tries to recognize what is their organizational value and how to implement them in order to become participating members of the organization (Griffin, 2009, 484-489).

To observe from their senior staff is the easy way for individual to find out that what can lead them to get rewarded and success. Therefore the organizational value becomes the values of individual behavior. When an individual happen to be knowledgeable of organizational values, expectations, and norms, they will try on to new behavioral factors. On the other hand, if employee enters an organization with weak organizational values, then the chance of the organization and the individual to success will seems to be very less. This will stress individual behavior and therefore the people would behave more furiously.

As from the information, I can say that organizational culture is necessary to be published at every firm. However, the organizational culture has the power to set the worker's mindset as well as their behavior towards their job. It also prevent the confusion and conflicts among the teams, because their value, policy, mission are same.

At the same time, the culture also helps manage the firm strategically. Which help manager to get people more organized and lead the work to be more efficiently.

On the other hand, it is difficult to implement and evaluate a culture for one company, since the internal and external may affect the culture. The key is to fit the culture to the organizational goal. Therefore, I would suggest that not only from the inside of the company to set the climate but make the use of customer feedback might help to implement the culture as well. However, not only those culture which is people oriented will help the firm to success, but get the customer more involved with the value and policy may help the firm to attract customer's heart.