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Corporate culture can be defined as 'the way we do things around here' (Daft 2009). It consists of the 'values, beliefs and norms present within an organisation' (Flamholtz, Randle 1998:244). Managers are an important part of a company's culture; they are the 'glue that holds organisations together' (Campbell et al 1993). Culture gives a definition to a company, it shapes the decisions that are made, why they are made and how people within the company interact. A culture is generally formed by a companies founder, it then adopts and evolves around the company, its employees and the environment within which it operates.
Different types of managers have different leadership styles, 'cultural leadership is about helping to create or develop a particular way of life and way of living for an organisation and its members' (Bate, 1999:237).
Democratic managers delegate to employees, empowering them, this is advantageous as employees gain more responsibility creating a more family orientated culture. Although it may mean that change will not be as quick as a change would have to be communicated all over the company. This management style leads to increased communication; any decision that is made goes through a number of people creating a stronger culture but a slower reaction time to the environment.
As a contrast to this an autocratic leader would be at the centre of the company, therefore any decisions go through them. In a changing environment this form of leader is advantageous as only the manager needs to change and adapt to the environment. This leadership style can produce a poor work culture and ethic as employees may become de-motivated.
Finally there is a Bureaucratic manager, a leader who makes sure that rules and procedures are followed consistently and carefully. This leadership style can be linked with poor communication therefore within a changing environment the bureaucratic leader would find that the company would be slow to react to any form of change.
'The culture, through things such as characteristics, leadership and rewards, provides a culture of its own' (Mendenhall et al 1995).
There are several different forms of culture, all of which work within different environments. The adaptability culture has an external focus and is flexible, the most appropriate for an environment with increasing uncertainty. It gives the company and its managers the ability to change to the environment and respond are react to signals from the environment. The ability to respond and react to change quickly would be most beneficial to managers in an uncertain environment; there would be the opportunity to get the best out of the company and its employees.
The Involvement culture is one that focus' more internally, on the needs of employees, for everyone within the company to be seen as equal. Employees are empowered in order to deliver results for the company, thus giving them a more defined culture. The company would still be flexible towards the environmental needs allowing ample time for the company to react to changes that may arise.
The achievement culture focuses on a more stable environment with an external focus. This is a more staid culture that offers a more results orientated approach based on achievement, although in an uncertain environment it may be that companies with this culture find that they have to change there focus in order to become more flexible so that they could react to the environment.
Finally the consistency culture with a stable environment and an internal focus would only allow a company to develop a very methodical approach to culture, this in an uncertain environment would be almost definitely going to fail due to the lack of elasticity in the culture, employees would not respond well to change and the company would move gradually further and further away from the environment.
The environment, being contemporary gives the company the ability to adapt, change, and look externally at the environment. Trying to be adaptive means the company would need to adopt a form of culture that is very responsive.
Environmental factors can be classed as internal or external. The internal environment contains everything within a company. The external environment can involve the political, economic, socio-cultural, technological, environmental and legal factors affecting the company. These factors are constantly adapting and changing so it is up to the companies' managers to follow the environments path taking advantage of the culture. Managers need to become leaders in order to be able to adapt culture and show that these changes are beneficial to the company and the employees. They have to lead by example and show that changes are necessary and in a contemporary environment managers will help other employees adapt and fit in with culture and the company. It is the ability to pay attention to employees, initiate change and value what employees bring to the table that makes a manager able to adapt culture.
Managers can affect the internal environment in different ways. Managers are in charge of the day to day decisions within the company the answers always revolve around the culture and what is expected. A certain decision may be expected within a specific situation or managers may be required to act in a specific manner. 'While leadership is in all societies, cultural norms influence what kinds of leadership behaviours are appropriate in a particular culture' (Mendenhall et al 1996). The company must be able to adapt to the internal environment; changes can be made within a company daily. If they are dealing with a new client, launching a new product, gaining outside help, anybody that the company interacts with outside its own boundaries will have a different culture; it is up to the managers to form a link between the cultures in order to do business in the industry. Also internally managers are expected to keep the company ahead of its competitors, to do this they need to be able to stay ahead of the environment, thus a companies culture can define how close to the environment a company can be. Managers can also affect employee relations, the culture can affect how employees interact internally, what sort of names are used to address members of staff. Employees generally look to mangers to enforce the culture and set an example.
Internally there are three levels of corporate culture (Daft 2009, adopted from Schein), the first layer, the visible layer, then there are two invisible layers of culture, the expressed values and the underlying assumptions. Problems occur when the underlying values do not link with the written down values.
The visible layer is what anyone can see when looking at a company, and it is the visible ways in which a culture manifests itself. Mangers are always at the point of contact and employees take the lead from them, including dress codes and the visible layout of an office. The culture can define when are where employees can meet to discuss work, if the office is open plan and encourages sharing or if offices are closed off and appointments are needed. Managers are also seen to be in charge but with a view of helping those further down in the hierarchy, developing schemes for advancement, thus evolving the culture of the company so that they can adapt quicker and use employee's skills and experiences in the most beneficial way to the company.
The express values guide behaviour guide behaviour within a company, but often it is led by the managers. This may also be changed from outside if new laws are passed and they affect how the company is ran. Managers lead but with an increasingly uncertain environment they have to provide more support to employees, potentially evolving and adapting the current culture to suit changes within the internal environment. 'The leader is the person who actively moulds the company's image... and who suffuses it with a sense of direction' (Anthony, 1994:38). A new manager may start work for a company and may not agree with how the culture is although he would find it hard to change the culture because of the express values held by the employees. Managers in the contemporary environment are more likely to value strong ideas that will benefit the company, increase its position within the market and improve its ability to change and adapt.
The underlying values are a deep layer of culture, embedded in the subconscious of a business. It is something that happens naturally, an everyday process that guides employees behaviour. It is not something that is written down or spoken about, it is an underlying culture that every employee already knows about. It is the underlying values that make a company what it is; they define the culture subconsciously in the minds of those within the company.
Also internally managers may find that the culture does affect working practices, a change in culture may help to promote quicker decision making within the company. This could be because of the changing environment and the increased uncertainty; managers have to react faster in order to keep the company on track, thus meaning employees have to react faster to keep up with the managers, creating a development in the culture of the company.
The external environment cannot be affected by a company but it can affect a company. Strategic drift is a serious concern for managers, especially within a changing environment. Managers need to be able to keep the business in line with the external environment, if the environment moves in one direction but the company does not then a gap is created. Culture can help to facilitate this gap but only if the managers of the company are quick enough to realise that there is a gap and that changes need to be made. This would be where managers need to develop culture in order to react to the environment Culture can make a company become entrenched in one specific way of doing things, thus creating strategic drift. It is then up to managers to make culture develop along with the environment so strategic drift is not a problem. As the environment changes the culture does not need to change but it does need to evolve in order to let the company grow.
High uncertainty in the external environment means that a company needs to adapt and change to suit the environment. Culture can create a static atmosphere where the environment is changing but the company is stuck in one place. It is a manager's job to overcome this, or to not let it happen in the first place and make a company react to the changing but adapting the current culture. Contemporary managers are more likely to care about other employees and consider there strengths and weaknesses giving the culture a higher possibility to expand, develop and grow.
Corporate culture affects different companies in different ways; it can be used in a positive way, to attract new members of staff, motivate current staff or to create a good work environment. Different cultures create different environments; culture that enables a learning environment encourages managers to share knowledge which would make the company more adaptive to the environment. Also culture can define what type of person is attracted to a company; with an adaptive culture a more responsive, faster paced and adaptive person will be attracted. They would be more likely to be able to change their culture to adapt to the environment and the company as whole would be more responsiveness to change.
In conclusion, in order for a company to survive, without being subject to strategic drift, in an environment with increasing uncertainty the managers need to be adaptive and autocratic, they need to be able to respond, not only to the environment but to the employees. A culture needs to be developed, it should, in essence, capture the company as a whole. Managers need to use their employees, a successful business has a culture that enables learning and innovative environments within which every employee has a particular skill that is useful to the whole.