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With the economy of the world on development constantly changing for status quo, organization to survive in a competitive environment with the development that it necessary high level of management, so it must be emphasized combined with organizational culture and strategic management (Herry 2008, p.215). Organization can set up a target that brings strategic than the strategic promote culture, in hence the organization must be established target in turn achieved to target of organization (Sahaf 2008, p.45). Because of organizational cultures are unique and offer strategic advantages, it makes complete sense that companies would consider culture in strategic management Strategic management of expert is believes that an effective strategic management must have been caused by the 5 key factors as below: unique of organization value, for the customer that well-designed service chain, interaction with staff, perdurability of organizational survival (Michael 1985). Therefore, the correct understanding and grasp of relationship between strategic management and organization culture which has supplement each other, that to enhance the behavior of the organization and promote corporate quality, rapid, sustained and healthy of development.
So I will from understand to the definition of organization culture and strategic management, importance of organization culture and strategic management, relationship between organization culture and strategic management, people who know is the culture of 4 aspects to analysis importance of organization culture to an understanding of strategic management.
What is Organization Culture?
Organization culture in the practice of the socialist market economy and gradually for all employees agrees to comply with the characteristics of the organization values (Schein 2007). The organization culture is formed in the enterprise culture concept, the historical traditions, common values, behavior standard of ideological of organization. Organizations leaders have made to cultural change functionality apply to business (Haasen 2009, p.121). In order to solve the problem in the modern organization management which have produced the "organizational culture".
"The organization culture is modernization of the mass production and the market economy based on new types of management that modern scientific management theory and management target" (Kotter 1992). Whatever it is the development company or has developed a successful company.
1) Implement industry civic duty
2) Trying to improve and enhance social life
3) Contribute to the development of world culture
So while there are many definitions of organizational culture, but all of they focus on the same points: routine, collective, experience, beliefs, goals, values and system. These are learned and re-learned, passed on to new staffs, and continues on as part of a organization core identity.
Why it is important of organization culture?
The organizational culture is the soul, the power and the source of the modern organization development (Parker 2009, pp.133-135). Strengthen organization culture, shaping the corporate image and spirit of companies, not only the needs of their own development also fundamental requirement for established economic and cultural. The organization need first as the forerunner to the culture by the transformation of the concept of development, a clear value orientation and adjustment of employee behavior. Promote companies growth, organizational structure, and the layout of the market, the product structure, resource allocation and management mode transition, so as to promote the strategic restructuring of organization and upgrade (Witte 2010).
"The importance of organization is in the increasingly competitive market conditions to meet employee's requirements and spiritual needs, To enhance the solidarity and cohesion of organization, stimulate employees initiative and creativity that improve the economic efficiency of organization."(Eikenberry 2005)
Hilton hotel "smile service" is important of organization culture (Konrad 2003).
Hilton employees paid great attention to the etiquette education, advocacy employee's service with a smile. Him every day at least for a Hilton Hotel in contact with the hotel's service personnel from the general manager to the waiter asked most of the sentence, must be: "Have you smile to the guests?" 1930 U.S. Recessionclo sure of all hotels in the United States by 80 percent in the worst year, Hilton Hotels followed by a loss unbearable also, liabilities amounted to $ 500,000, Hilton was not discouraged, he convened a hotel employee confessed and appealed to them, especially: "At a time when Hotels deficit by borrowing big period, I decided to strong tide over the crisis. Once past the period of U.S. economic panic, the Hilton Hotel will soon be able to enter a rapid development of the situation. Therefore, I ask you to remember, Hilton etiquette can not forget. Irrespective of the hotel itself, the difficulties encountered, the smiles on the faces of the Hilton hotel waiter forever belong to the customer. "In fact, only 20% of the hotel that has been closed down, only Hilton hotel waiter's smile is good. Recession just passed, Hilton Hotels & Resorts is leading into a new period of prosperity, the golden age of cross-person business (Konrad 2003).
What is Strategic Management?
Strategic management is defined as: Organization to determine its mission to set the strategic goals of the companies, according to the external environment and internal conditions goal, in order to ensure the correct implementation of the goals and achieve of plan and rely on organization internal of ability will be this kind of planning and decision making implemented. This is the implementation of strategic management of process (Ryall 2008).
Organization is that the certain period of global, long-term development direction, goals, tasks and policies (Pratt 2009, pp.394-395). Strategic management is unsure process because of different understanding of risks and opportunity for organization (Nelson 2010).
"From the future development of organization point of view, the strategic performance for one kind of plan, From the course of development of organization the point of view in the past, the strategic performance for one type of Pattern. From the industrial level the strategic performance as a perspective, the strategy also manifested as for organization in competitive put to use ploy" These are very famous 5P model (Mintzberg 1998)
Why it is important of Strategic Management?
Organization leader consider focus on research to operation environment , the right to determine the company's direction, select the business areas suited of the company, and thus better able to grasp the opportunities offered by the market environment, and enhance the adaptability of the business activities of the market environment, to achieve the best combination of the two(Hill 2004, pp.276-278).
Emphasis on the implementation of the strategy
The implementation of the strategy as part of its management, this is the strategy of the enterprise in the day-to-day production and business activities, the strategy according to changes in the market environment continue to evaluate and modify. Strategic management can get continuous improvement, this iterative process, a more prominent role in guiding of the strategy in the management to practice (Urip 2010, pp.98-101).
"The important of strategy is a set of guidelines characterized by long term focus, decision making, integration of business function, implementation" (Mintzberg 1991)
IBM has long-term of strategic management
In 1911, IBM introduced the computing business dominated the industry for decades. IBM went to the trough in 1991, when revenue fell 6%, faced with a new rival at home and abroad, chiefly by the pressure from Japan, the European Community and the United States to challenge at the same time.
IBM had a whole further adjustment of the original strategy. Nabisco is IBM CEO (Gerstner 1993). His revival plan, including the IBM spin-off as an independent business unit, is responsible for insurance, health care, retail, transportation and financial industries. IBM is committed to build a computer network for the enterprise, that: After five years of reform, they think the strategy can change, organizations can be changed, and the purpose can never be changed. IBM supports the improvement of the system, open the channels of information to improve decision-making efficiency, so that the leadership system has better adaptability. Large-scale reform of the leadership system reforms IBM, in 1983 to 1984 to complete. This reform gives us inspiration: In order to face the challenges of a new technological revolution, to face the needs market competition, the modern organization leadership system must be reform strategy.
Effect of relationship between organization culture and strategic management
The organization culture is the foundation of strategic management, corporate culture to strategic management to develop, implement, and control the correct guiding ideology and spirit of enterprise business goals, organization values, organization ethics and organization fashion, so successful corporate culture that can be provided for the formulation of organization strategy, is key to implementation of organization strategy, is also an important condition for maintaining the organization strategic advantage (Heracleous 2003, pp.113-115). It seems that we can see that corporate culture plays an irreplaceable role in the development of the enterprise, but after analyzing the same time, we know that the organization culture of the strategic management also have negative aspect of effect.
1. Negative affect of organization culture to understanding strategic management.
1) Hinder mergers and acquisitions, hinder strategic merger, the main purpose of strategic acquisitions to improve its financial position so that let both products can enjoy the benefits. Regardless of the financial statements of how attractive after merger, mergers and acquisitions whether successful, they have to take a look at both culture there is no way to blend that to decide, organization culture cannot be interflowed, is not conducive to the development of companies (Frecsch 2007).
"Inaccurate merger" between Time Warner and America Online
When Time Warner of America and AOL (America Online) merger was announced in 2000.this deal valued 166 billion, "Business Merger" soon become a notorious of mismatch. Since there are profound cultural differences between traditional media company Time Warner and a new network giant America Online. After the merger, the company soon caught in a situation of cultural incompatible. "Because of Time Warner employees think about America Online of colleagues too pushy and too radical, while AOL employees think about Time Warner of colleagues are very arrogant, doing things passive and lazy, So during that period, the value of the stock that loss reach to $ 200 billion"(Hill 2002).
So in order to avoid this problem, the company executives in early stage of the merger process, that a clear understanding of the organization culture of the two companies and whether reach agreement on the long-term strategic management plan.
2) Hinder the implementation of enterprise innovation and strategic management does not match.
The cultural of the enterprise may not meet the new corporate environment, enterprises in order to adapt to changing market needs, in order to implement the new strategy, and often need to change some folk traditions (Carlopio 2008, pp.178-180).. When market demand accelerated updated strategic management plan becomes a burden.
Kodak management is traditional industries of origin
Kodak has maintained the traditional culture of the design. Such as: Charles Barrentine, currently vice president of operating systems is to study chemistry, general manager of digital imaging systems, United States District Cohen learning civil engineering. There are currently 49 senior managements of these seven original of chemistry, and only three from electronic professional. Market applications and maintain its leading position, traditional industry leaders ignored the continued development of alternative technologies, and new product market share leadership should lose (Wessex 2009). The fierce competition in the technology market and the microelectronic technology leading cycle shortened to strengthen international competitors, and thus whether staffing long-term technology development, cannot be timely innovation and respond to market strategy. These factors have led to the Kodak inevitability of crisis.
2. Organization culture impact on strategic management in which areas is positive
1) On employees
A strong organization culture can attracted talent
Your organizational culture is part of the strategic management that prospective employees look at when assessing your organization (Carlsen 2008, pp174-175). Gone are the days of selecting the employees you want from a large eager pool. The culture market is tighter and those looking for a new organization are more selective than ever. The best people want more than good benefits. They want an environment they can enjoy organizational culture bring to their success in (Russo 2009, p87).
Amazon founder Bezos was insist on its unique cultural patterns that made attract talents, let candidates not only by Bezos interview also by other employees of the interview, if other employees dissatisfied of applicant that cannot be hired. Every time someone has to be hired, the company's recruitment standards will increase than before. Therefore, the company also improved quality of staffs that confront high strategic target. That's Bezos to keep one of the company's staff of highly culture to strategic management of target (Bezos 1995).
2) On customers
With the increasing of market competition, customer loyalty has become a decisive factor affecting the long-term corporate profits high and low. Use brand to build and cultivate their own competitive advantage which has become one of the main strategies for use by the organization culture marketing competition in the international market, but brand in order to long invincible, the key is to increase customer loyalty and win the trust and support of consumers (Kober 2010, p231). Only a profound understanding of the meaning of customer loyalty, facilitate organization to develop the right strategic management objectives, more reasonable with the propaganda of the organization culture, in order to eventually achieve to the maximum advantage of the organization culture in the international market (Woodside 2010).
Good after-sales service is the corporate culture of the guarantee
Epson (Japan) able to get so support is inseparable and they practiced "day repair service. The called "day repair service, the computer in case of failure of the latest in the second day of the defective product to the repair station can be completed repairs to send back to users. Computer failure may be caused by different parts, want to quickly find the repair is not a very easy, but Epson still so commitment and practiced. Instantly reach 80% of the repair defective product daily repaired the hands of users send will be .Of course, it is able to achieve "one-day repair, and product quality as well as the quality of the service personnel is inseparable. Product quality is too low, then failure will increase the number of products, the low quality of the service personnel, let alone a speed of repair, but the Epson product quality and after-sales service personnel are corporate strategic management assurance so in 2010 Japan in the after-sales service and user support both user satisfaction survey, Epson won first and second place respectively. This is Epson organization culture impact on strategic management in customer's areas of goals. So "To live up to the trust of the customer, this client will never come back. So no matter how far we have the sales of products and services delivered in front of the customer. In order to live up to the trust of customers, after-sales service in particular need to focus, This is our long-term strategy goals for customers ( Kiyofumi 1950).
Good after-sales service is an affirmation of the corporate culture is the implementation of the strategic management of a recognized priority to customer satisfaction, competitive advantage for the industry will be more obvious
How do people know is the culture?
Pixar Animation Studios
Pixar was formally established in 1986, after 20 years at the time following the Walt Disney Company to subvert Hollywood movies and Shock the world innovation paradigm. Many people are familiar with Pixar may be chiefly from their animated film: Toy Story, Finding Nemo. However, the pursuit by the success of the company and the company's corporate culture is inextricably linked (Paik 2007, p.185).
Pixar's most famous corporate culture is the concept of "The following guilty", no "senior and junior" in Pixar internal. Large amusement park, friends have seen "Monsters, Inc." DVD Highlights must be very envious of Pixar's work environment, there is like "Entertainment Unlimited" bizarre toy and quirky staff everywhere, any ordinary animators is You can put forward ideas for discussion. The local newspaper referred to here as "adolescent paradise, even the cafeteria in the hospitality food fun general staff will be glad to tell the boss how to do it best." Finding Nemo" director Andrew Stanton once said: "What is the senior, sector leadership, these words we all do not, and this is our unique place" (Pixar Animation Studios 2008).
In 1991, Pixar has adjusted the company's strategy to choose the world's largest is also the oldest animation film company Disney, Pixar and Disney signed an agreement making computer animated feature film by Disney responsible for the distribution (Buckley 2011, pp.35-37).
16 years that Disney cooperation with Pixar launched the "Monsters Inc", "Finding Nemo", "Cars", "and many applauded movie houses, and then allow people to become more conversant with this production level and the Disney animated film industry animation film company. With the launch of many of the best animated movies, not only for the enterprise has brought huge profits, leaving the animation movie fans around the world have had a keen interest in this company. The characters in the animated film produced by the company more and more in places other than the movie screen, which also shows more and additionally known as favorite(Jackson 2009). Pixar can create so many outstanding animated films, which is closely related to corporate culture, thoroughly implement the degree of freedom and the empowerment of employees. Bathed in California sunshine Pixar headquarters in Los Angeles coast, has a spacious hall is decorated with paintings of modern art. From the interior, Pixar headquarters even like a corporate office is more like a "church" of the animation. Daily breakfast and lunch time, around 1200 "believers" will spend meal time; work time in their respective dispersed to continue their work. Pixar, employees are full interaction is important (Keith 2010, pp.111-112).Frequency and quality in order to promote the exchange of personnel the greatest degree. Pixar not only with a unique architectural design developed a series of system, which is the most representative of Pixar University. Pixar University was founded in 1996, located next to the main building of Pixar; it has a swimming pool, soccer field. Pixar University offers over 110 training employee developments within the professional education training courses, from a technical training gradually extended to arts education in general, including the complete film production, painting, sculpture, creative writing courses. Any Pixar employees, animators, accounting, security guards or marketing staff can freely choose courses (Buckley 2011, p.75).
Precisely because of the impact of the corporate culture of Pixar, the company timely adjustment of corporate strategy, merely the achievements of today's Pixar animated film market as well as the animated film history.
Analysis of all the report, we know that the organization culture will be more and more importance in enterprises. An organization culture to the long-term development management strategy which has requires a culture supporting. I think organization culture and strategic management are interdependent each other, and must create a good corporate culture to embodies the advantages of long-term strategic management support as well as the analysis of market competitiveness, as is the development of enterprise and consumer acceptance of successful enterprises, need expand and improve the long-term strategic objectives plan. Management, technical staff must promote enterprise innovation ability is the development of a larger market requirements, in order to meet consumer demand, corporate culture for the importance of strategic management will be more clearly reflected in the market environment in the future.