Analysis Of The Impact Of The Organisations Culture Commerce Essay


According to Schein (1988) organization culture means "The deeper level of basic assumptions and beliefs that are: learned responses to the group's problems of survival in its external environment and its problems of internal integration; are shared by members of an organization; that operate unconsciously; and that define in a basic "taken -for-granted" fashion in an organization's view of itself and its environment." It consists of three levels behaviour and artifacts, values, and assumptions and beliefs.

Organizational culture and values are formed, maintained, or altered by leaders of the organization. It expresses inclination of certain behaviour, outcomes, and communication. Schein states that a leader's success depends, to a great extent, upon understanding organizational culture. He also suggested that an organization's culture builds up to help it deal with its environment. Today when organizational leaders are needed to tackle with many intricate issues during their attempts to generate organizational achievement in business environment; they need to have thorough understanding of the prevailing culture and values in their organization.

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Schein asserts that many of the problems confronting leaders today are their inability to analyze and assess organizational cultures. Many leaders, when trying to implement new strategies or a strategic plan leading to a new vision, will notice that their strategies will fail if they are inconsistent with the organization's culture. Difficulties with organizational transformations occur from failures to analyze an organization's existing culture.

According to Marcoulides & Heck, 1993 and Schein, 1992, an organization's culture has an extensive force on its ability to execute its strategy and to achieve business goals and objectives. It is the organizational culture that facilitates the acceptable solutions for knowing the problems, set the principles, expectations, behaviour, patterns, and norms that promote a high level of achievement.

Therefore it is clear that an understanding of culture of an organization, and how to transform it, is a fundamental skill for leaders trying to achieve strategic outcomes for their organizations. Strategic leaders have the best perspective on the culture of the organization because of their position in the organization; they see the dynamics of the culture, what should remain, and what needs alteration. Understanding the organizations culture is the essence of strategic success for the leaders as well as the organization. The culture of an organization has an impact of leaders and their leadership.

The impact of organizational specific, legal, regulatory, and ethical requirements on strategic leadership demands

Leadership is about those who are in a position to make decisions; create opinions and approaches. It is more than just managing the organization; it is huge responsibility. Because leaders have to lead the people and set examples for them to look on to, their words, actions, and values play an immense role in their success as well as that of the organization. Accountability and integrity are two of the most important elements of leadership; each is deeply based on the interaction with people within as well as outside the organization. Because every action has an impact, ethics is always part of the decision-making process. Leaders know that every decision has to be carried by responsibility and credibility. To be recognized as a leader requires exuding trust.

Legal brings in another concept that leaders have to watch before making decisions. Today's leaders must understand the regulatory system in order to function in face of agency, directives, reviews, inspections, and regulations. With constant change in the business environment there is change in legal and regulatory requirements as well as which needs to implemented with immediate effect. This change impacts the decision by strategic leaders and management.

The future directions, goals, or decisions of strategic leaders should be flexible to adjust the influence of changes in legal and regulatory requirements; in addition to this they should also be ethical. It is the leader, who has to assess the legal requirements, viable ethics, and the regulation to combine them with the mission of the organization, so that everything goes hand in hand. Therefore it is clear to understand that legal, regulatory, and ethical requirements in an organization have an impact on strategic leadership demands.

Evaluating current and emerging social concerns and expectations impact on strategic leadership in the organization

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Organizations have to take into account core social issues that go beyond their profit making scope and legal compliance and therefore act in response to the growing pressures, demands, concerns and expectations of different stakeholder groups or individuals. They are increasingly required to take account of the impact of their activities on the society and environment Social expectations and concerns that influence leadership in an organization are as follows:

Segregation on grounds of gender has been a social concern which has historical evidence as well. Solomon (1990) reported that at the Vice President level of organizations, women VPs were compensated an average of 48% less than their male counterparts. Lublin (1998) showed this trend reversing within Fortune 500 companies wherein women leaders averaged 32% less than their male counterparts.

Leaders with ethnocentric perspective towards work style can become concern with regards to the diverse ethnicity in the organization. It can lead to problems like racial discrimination, differentiation on grounds of religious belief, geographical location discrimination, etc.

Looking out for well being of employee that is creating an environment for work - life balance; has been a constant apprehension for leaders and managers at a strategic position. It has been a rising concern that personal space is evaded by professional work. The work pressure has increased to an alarming level. Such working conditions do not produce positive effect as well as results.

Flexible working timing rings positivity but as social expectations it affects training, supervision, and control aspects. Its implementation can bring about a change in organization structure and its processes. This further creates a necessity for innovative leadership styles and managerial practices.

Privacy from personal information perspective has become an emerging concern. It has gathered that some organizations leak employee data base to research companies as well as advertising companies. This needs strict supervision as well as increase in security levels.

2.1 Evaluating the relationship between strategic management and leadership

After a shift in focus from strategic management to leadership there has been a common belief that management and leadership are the same role. While it is common that many managers have the virtues and potential of a leader who play the part of the leader, but in reality these two roles are detached in function and in the way they add to the success of an organization. According to Peter G. Northhouse "In the organizational context leadership can be defined as a process through which an individual influences a group of individuals to achieve a common goal". The function of management is to ensure fulfilment of organizational goals in a consistent, efficient and orderly way.

The managerial function thrust is on creation of long term vision, development of values, culture and behaviours necessary for pursuing the vision and inspiring people for voluntary commitment to organizational cause and success. At the same time it is leadership, which is responsible for designing and developing a suitable management system for the organization, to ensure systematic and orderly accomplishment of desired goals. The importance of leadership in an organization emerges due its role to create and shape organizational culture and to set a progressive direction for the organization. Without this there is neither any role for management nor any cause for it to exist. Leadership creates a context for the management to exist. Management on the other hand, through well laid out processes and systems, ensures that effective leadership at every level is developed in the organization, as a driver for future growth. Leaders create future through strong ideas and leave strong imprint of ideology for the company on which the management system is designed. 

Leadership is still in art form there is not concrete definition, it has no best or worst way of doing it - no universal framework or models exist to define and shape leadership concept. On the other hand management is treated as science and distinct because it is distinct, were definite frameworks and systems exist to carry out the functions of planning, organizing, staffing and controlling. An organization is run on the potency of its management systems while leadership provides the vitality to look beyond to form vision and race ahead by giving appropriate directions.

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It is essential to comprehend that leadership and management may be considered two inseparable and intertwined aspects of organization which exists in reality, without one the effectiveness of other is jeopardised.

2.2 Evaluating leadership styles and their impact on strategic decisions

Leadership is a feature that persuades a group people towards the accomplishment of the organization goals and success. The impact varies according to the style of the leadership, this impacts the strategic decisions that needs to taken for fulfilling the success of organization. A leadership style varies on grounds of the extent of control or behaviour portrayed by the leaders.

Different leadership styles on basis of control:

The Laissez Faire Leadership Style: This style of leadership tends to minimize the amount of direction and face time required to guide people within the organization. The decision is completely decentralized decision. The leaders do not interfere into the matters of other people until and unless called for. People view is taken into major consideration for taking strategic decision.

The Autocratic Leadership Style: It is a style of leadership has faded as modern business ethics became more widespread. This kind leadership gives centralized power to the leaders which tends to gives dominance requiring people to follow strict orders. The impact of this style has created negative vibes in the organization environment as well as decisions.

The Participative Leadership Style: This style lies in between the control based leadership continuum. It gives the people in organization the appropriate amount of freedom as well as control required for smooth running. The impact of decision has a positive outcome, wherein, the decision is made keeping in mind both people as well as organization success.

Different leadership styles on basis of belief:

The Benevolent or Paternalistic Leadership Style: The leader has a belief that the people in the organization need to be relentlessly guided and treated with warmth. This tends to be a relationship oriented. The decision made by such leaders is more based on belief's regarding the people involved in the process. It tends to be more emotional rather than realistic.

The Critical Leadership Style: The leaders with this style have a belief that the employees should be constantly controlled and directed, they should also be reminded about the goals that are to be achieved. The decision made by the leaders is realistic and intolerant towards conflicts and complains from employees.

The Developmental Leadership Style: The leaders hold a belief that the employees are reliable resources that can be trusted with responsibilities. The leaders believe in developing the competencies of the employees. The decision making responsibility is gradually entrusted to the employee. The impact on strategic decision is more of transparent process, involving the knowledge and acceptance of majority.;

Evaluating the impact of adapting leadership styles in different situations on the organization

Leaders lead the crowd, people follow their given directions. The times being highly volatile and fluctuating from period to period; leaders needs to be well prepared to adapt to varying situations in business as well as organization. The environment within the organization has also become turbulent due to ethnicity mix, culture mix, and professional combination. The situation created due to the above factors also needs the leaders to be efficient to mould their styles accordingly.

The Situational Leadership concept from Kenneth Blanchard and Paul Hersey explains how leaders must use different leadership styles depending on the situation. It further elaborates on how the needs of the hours must be analyzed to act in response with an appropriate leadership style to sync with the situation.

The efficiency with which leaders mould their approach shows their versatile nature to move along with changing time demands. This suppleness to adapt to changing environment shows the strength of the organization to survive in turbulent conditions and carries the organization smoothly through the phase of change. It strives towards a solution and direction for success. Organizations not possessing such leaders fail to stand strong in hard conditions. Adapting to different styles in this context does not stand for unpredictability or indecisiveness of the organization but gives it an edge to compete heads on in the business environment.

3.1 Developing a culture of professionalism, mutual trust, respect, and support within the organization

As a responsibility of leader to lead the people the basic necessity is to develop an environment to support, trust and respect among the people as well as towards themselves; it is also essential to convey the importance of professionalism for strong culture within the organization. Understanding the importance of the above does not suffice the need to build the organization.

The steps involved in developing a culture of professionalism, mutual trust, respect, and support within the organization are as follows:

Vision: Having a vision to create a particular environment is essential. A proactive leader has a vision for present and future. They act upon their vision for creating directions and developing a culture that is in sync with the values and ethics of the organization.

Defining It: The leader must define the culture that has sync with the environment and has minimum discrepancy with people in and around the organization. The values like professionalism, mutual trust, respect, and support must be emphasized upon to accentuate their importance.

Communicating It: It is the most essential part of developing a culture. Defining it is the initial process but to push this process further it is mandatory to communicate the same to the people within the organization. Since they are the major part of the corporation

Teaching It: The leaders need to take time to instill the values in the minds of the people to strengthen the development of the culture. To make it a part of reality the teaching has to be set in place. It can be done through informal as well as formal ways whichever is more effective.

Living It: The people trust their leaders and tend to follow their words and directions as the final decision. If the leaders themselves are not in agreement with the culture the steps above are of no importance. It is a must for the leaders to imbibe the values like professionalism, mutual trust, respect, and support; and express the same so that it has an impact on the people following the leaders.

Thus the actions of the leaders reflect the values and culture which in turn becomes guidance for the people and sets direction for them to achieve organizational goals and success.

3.2 Evaluating the impact of a strategic leader's clear focus in leading the organization in the achievement of objectives

Leaders are said to have immense influence on the followers. They can change the direction of the organization as well as set a new one to be followed. It is possible only when the leaders have great focus on the internal as well as external factors impacting the organization and the mission of the organization to achieve the objectives set for success.

The focus of the leader is mandatory to analyze the needs to employees, organization, as well as the rest of the business environment. It is also important to start initialization of change in strategies and tactics. A clear focus is needed to make strategic decisions and implement the same for the success of the organization. People following the leader are also conveyed with the message seeing the focus of the leader on emphasized factors.

The above stated importance stands strong to advocate the positive impact that the leaders clear focus has on the achievement of objectives to sail the organization towards success. A leader without a clear focus cannot face people with confidence and such leaders are neither trusted nor respected. The leader will not be able to analyze the needs and assess the importance, thus leaving behind a confused state of mind. Their confusion can dishevel the set directions and cultures of the organization; in turn leading the organization astray from its course towards achievement of success. Organizations led by such leader flounder and fail in the changing business environment. Therefore, it is important for the leaders to alert and have clear focus to adjust to changing demands of the business environment.

Clear focus of leader means commitment and passion to fulfill the organizational objectives which are passed on to all the other members of the organization.

3.3 Analyzing the role of strategic leaders to support and develop the understanding of the organization's direction

A passive entity like an organization relies on the passion of a proactive leader to carry it forward. The role of a leader is not just to influence the people to follow the directions but also to develop and communication the direction.

The members of an organization are tuned in and taught to follow the set direction of an organization to be in sync to push it forward. Members alone cannot do so until there is a voice above them that supports and develops the understanding of the direction. The people should be imbibed by the importance, reason, and effects of the organization's direction so that it gives a clear picture as well as importance to the people.

A strategic leader to fulfill the above role is essential because they possess the charisma to not only influence but to lead them with guidance. Until and unless the direction's are not understood and the importance of the same is not felt, then success cannot be achieved. Leaders are the people in an organization to understand this situation the best. Also it is must to understand that leaders can only support and develop the understanding of the organization's direction when they themselves are focused and synced with the same.

3.4 Analyzing adaption of strategic leadership styles to meet changing needs, and to enable organizational development and commitment

The Situational Leadership method from Kenneth Blanchard and Paul Hersey is based on the belief that leaders must use different leadership styles depending on the situation. The model analyzes the needs of the situation, and then uses the most appropriate leadership style. Depending on employees' competences in their task areas and commitment to their tasks, the leadership style should vary from one person to another.

The amount of direction and support that the leader gives to their followers is the ground for characterization for leadership style.

Fig. 1

Leadership Behavior of the Leader

S1 - Telling / Directing - High task focus, low relationship focus - leaders define the roles and tasks of the 'follower', and supervise them closely. Decisions are made by the leader and announced, so communication is largely one-way.

S2 - Selling / Coaching - High task focus, high relationship focus - leaders still define roles and tasks, but seek ideas and suggestions from the follower. Decisions remain the leader's prerogative, but communication is much more two-way.

S3 - Participating / Supporting - Low task focus, high relationship focus - leaders pass day-to-day decisions, such as task allocation and processes, to the follower. The leader facilitates and takes part in decisions, but control is with the follower.

S4 - Delegating - Low task focus, low relationship focus - leaders are still involved in decisions and problem-solving, but control is with the follower. The follower decides when and how the leader will be involved.

Development Level of the Follower

D4 - High Competence, High Commitment - Experienced at the job, and comfortable with their own ability to do it well. May even be more skilled than the leader.

D3 - High Competence, Variable Commitment - Experienced and capable, but may lack the confidence to go it alone, or the motivation to do it well / quickly.

D2 - Some Competence, Low Commitment - May have some relevant skills, but won't be able to do the job without help. The task or the situation may be new to them.

D1 - Low Competence, High Commitment - Generally lacking the specific skills required for the job in hand, but has the confidence and / or motivation to tackle it.

Steps in involved in the process of situational leadership:

Make an overview per employee of his/her tasks

Assess the employee on each task

Decide on the leadership style per task

Discuss the situation with the employee

Make a joint plan

Follow-up, check and correct


After the completion of the assignment, which required reading many articles, I gained knowledge of varying styles in leadership and their impact. It gave me a perspective on the whole concept of leadership. Leadership need not be made as a different entity in the organization for its success; management can inculcate the characteristics of leadership to take the lead and move the organization ahead along with changing times.

The importance of being a leader and fulfilling the role of leadership is a very challenging task. The responsibilities are high and are of great importance which affects the organizational success directly. The leaders also have a direct impact on the development of other members of the organization as well.

Though different styles are mentioned which have a positive impact on the organization but the best theory and model developed is the "situational leadership" which is in sync with and has maximum relevance to today's business environment demands. To be adaptive to the changing situations the leader has to be versatile and efficient to adjust himself or herself; and lead the same change among the people in a smooth flow.

No entity like culture, values. Leaders, people, etc are independent; they are interdependent and without anyone of them the others are jeopardized.