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Strategic management involves the analysing of organizational tactics and factors that may contribute to results or performance. In view of achieving this, organizational culture must be looked at as it greatly forms the base of establishing good strategic management. In this essay, we will find out what defines organizational culture and its importance, its impact on strategic management, how the public views the culture and how the culture has affected its strategic decisions, choices, options, etc. We will also discuss about some successful companies and organizations to showcase their organizational culture to see how it has worked for them.
Oxford dictionary distinctly states that organisation is, “an organized group of people with a particular purpose, such as a business or government department.” (Oxford 2012)
Culture on the other hand is, “the ideas, customs, and social behaviour of a particular people or society.” (Oxford 2012)
Organizational culture is then therefore essentially based on shared attitudes, beliefs, customs or written and unwritten rules which the organization has developed over time and that have worked well enough to be considered valid. Factors of organizational culture that will be discussed are the company’s structure, decision making empowerment, the company’s hierarchy and employee commitment towards company goals. Depending on how these factors are effectively diffused through the company, the productivity and performance of the company will be affected directly as these factors serve as guidelines for customer care, safety, product quality, etc. They may also extend to marketing and advertising practices and to new innovations.
Apple and its customer/product service
To help us understand better, we will now look at a company which has an outstanding organizational culture in its customer/product service. Apple is a company that is very user/customer oriented. When someone buys an apple product be it a MacBook or an iPod, they are guaranteed excellent customer/product service after they make their purchase. A standard warranty of at least one year is issued upon purchase and its offer is that the entire product can be sent for a ‘one-for-one’ exchange if the product is found to be faulty (Apple 2012). “A guarantee is not only an assurance that things will go right – it’s a promise that you will make things right if they ever do go wrong” (Kaufman 2012, p.168).Aside from the mandatory warranty on all products, all Apple products are able to be linked up online via iTunes for many updates and product software upgrades (Apple 2012). This culture of having the products constantly up to date even after purchase is a critical one which makes Apple stand out by keeping users constantly updated to the newest trends in IT and enables the user to accessibly and efficiently receive updates and upgrades from the internet. Denove and Power IV (2007, p.200) state to “Reach out to your customers and don’t wait for them to contact you. Smart companies proactively create and sustain a steady line of communications with customers.” This maintains the relationship that Apple has with the customer not only through the purchase of the product but throughout the customer’s entire usage of the product. Also, product servicing centres are available in several areas and are known as Epi Centres. At these places, any Apple product can be sent for servicing, warranty exchanges or troubleshooting, depending on the problem.
Kaufman compares Lexus in example, that:
Consider the way Lexus promotes its service contracts and guarantees maintainence of its vehicles. Drivers worldwide have come to expect and appreciate that their Lexus service department stands behind their products and will recover quickly whenever a problem occurs. Lexus doesn’t know what might go wrong, but it’s committed to maintaining a reputation for service as admirable as the quality of its cars. That requires systems, people, and a passionate service culture eager to solve problems and guarantee satisfaction. (Kaufman 2012, p.168)
By caring for the customer even after the purchase, Apple has put a lot of emphasis into ensuring that the customer is satisfied with the product and in turn, places great trust and high regard in the brand name. In doing so, Apple establishes a reputation for the extensiveness and efficiency of their service as remarkable as their high quality and high technology-savvy products. The results are that customers rely greatly on their brand, knowing that only Apple offers such extensive post-purchase services, competitors are always trying to find new ways to compete with them in the IT market and creating in the minds of consumers, that Apple is a customer friendly brand name that will guide customers thoroughly from the moment they purchase a product through to the continued use of it.
Facebook and its security
Another company with yet another outstanding organizational culture is Facebook. Facebook is a social networking site which has many security features that keeps users’ personal details confidential by placing many security features and options that users can choose. For example, aside for typical security questions and passwords for user log in, they have features where users can report harassment should there be someone misusing the website to harass or intrude on someone else. “If you’re reporting a fake person or inappropriate information, that’s all you need to do. Facebook will thank you for reporting the problem, then they’ll investigate your claim and close the account if warranted” (Facebook 2012).
Such people when reported will be blocked off by administrators or have their accounts deleted or monitored. Nudity is also not allowed and controlled so that the site can remain its integrity to be open to users of most ages. This is also to deter predators and cyber world offenders from engaging the site to solicit any sexual activities or to prey on the innocent. This is done to maintain the high level of security so that users feel comfortable in trusting the site to upload personal photos, videos or information.
Jones and Ashenden state that:
The access of the individual to the internet was followed, very quickly, by crimes that are related to its use. With the commercialization of the Internet, the types of crime involved increased, as crime will always follow the money. When a new technology is introduced, criminals will quickly adapt to take advantage of it. (Jones and Ashenden 2005, p.172)
As crime has a high potential in any internet platform, it is therefore vital that Facebook implements high levels of security features to its user interface especially since it is a social networking site where real people are behind accounts. Intellectual property theft such as plagiarism can also be reported if it should be found to be infringed upon in Facebook. Once reported, administrators will look into the matter and control the offensive account accordingly. Such a culture is highly regarded and appreciated by many users worldwide.
As security is the foremost of things users want to have when uploading personal information on a social networking site, it is highly valued even more so when Facebook does it so well. The level of options and functions a user can make in deciding how much personal information is being viewed by friends or public is also extensive. Such security features provide trust and assurance for users so that they feel comfortable and safe enough to reveal any personal details online.
Jones and Ashenden state that:
Corporate entities that have, or are likely to, suffer financial losses have already started to take action to protect their investment – to do otherwise would not be good management. They have taken action to improve the security of their sustems and make crimes against them more difficult, and they have also formed associations and groups with similar interests and problems to share knowledge and prevent others from suffering from a known type of crime. (Jones and Ashenden 2005, p.181)
The importance of computer security is hence, not only paramount in protecting users and the business integrity of the company but also in reducing the losses in finances required to carry out damage control once a crime has been committed on a website, not to mention a popular and appealing one such as Facebook. Thus, high standards of security must be met in Facebook lest the company risks losing finances and more drastically, its users who may deem the site to be unsafe and insecure. “If the product or service quality fails to consistently meet its own high standards, the community will dissipate faster than it was formed” (Denove and Power IV 2007, p.200). Hence, Facebook security is detailed in various levels of informative instruction on how to increase or toggle between security applications. Online security manuals issued by Facebook can also be accessed by the public regarding how to step up the security functions in their accounts (Facebook 2012). Aside from the unique appeal that Facebook has in its user-friendly interface, interactive game applications, friend finding system and Facebook chat system, what stands out the most is the high standard of internet security that the company stands by. Such culture truly develops a sense of security and assurance among existing users and encourages new users to join the site.
Domino’s and its employee commitment
For successful strategic management of any organization, an organisational culture that must be inculcated into every employee is employee commitment. Passion to please and satisfy a client or customer is paramount in determining the success of the client’s experience with the employee. In order to exceed the expectations of clients and their perception of the experience be it in the form of a type of service, product or transaction, the employee must first be genuinely committed to wanting to surpass that expectation. It is so important that for many companies, they place it in the company’s structure of missions or visions and as one of the company’s values. An example of a company that promises customers quickness is Domino’s. Domino’s has a 15 minute rule, where customers are promised their pizza by 15 minutes. If it comes later then 15 minutes, the pizza is free of charge. This same rule applies for deliveries where the time limit is 30 minutes instead (Domino’s 2012). Customers will therefore only expect nothing more than 15 minutes of waiting for their orders. This culture of ensuring customer satisfaction is very fundamental in keeping them a fore runner in the fast food pizza industry. “Great guarantees promise if something goes wrong, a customer will experience happiness, not just an exchange or return of value” (Kaufman 2012, p.169).
Customers who encounter employees who are genuinely invested in their cause will feel truly appreciated and invited and hence the experience will be heightened. In seeing companies live up to their promises, a customer would truly have respect for the company and its culture and may even retain its loyalty because of that. Of course, for a Domino’s pizza maker to make a pizza in 15 minutes is no simple task, therefore training plays a huge part in educating an employee to be well versed in the organization’s structure, work ethics and culture. Only after employees have been taught and immersed in such intensive training would they be more committed to the organization’s goals. “Research has shown substantial links between employee commitment and their intentions to remain with the company and to expend effort on the company’s behalf.” (Mitchell 1997, cited in Kusluvan, 2003, p.349) Not only is this good for business but the employers would be assured that the employees have been well trained and committed enough to extend out to customers and live up to the company’s organizational culture.
Macdonald’s and it public awareness
In order for the culture of any organization to be understood, it has to present itself in a fashion that is recognisable for the public. The acknowledgement from society is of utmost importance as it is a factor determining the image or reputation of an organization. Understanding the culture of an organization would be fundamental in corporations and other companies in considering partnerships, ventures and mergers. Product or service perception is also created in people when they see how an organization’s standards are in its culture.
A company to look at is Macdonald’s. Macdonald’s constantly pumps in a lot of revenue into creating public awareness in its campaigns. Posters, advertisements and commercial adverts on television provide a source of understanding Macdonald’s organizational culture. Macdonald’s often puts up many advertisements in television commercials and newspapers showing their quality of fast food prepared by dedicated employees. Employee job ads are also often placed at their restaurants or in the newspapers to encourage people to join their team of hardworking, committed staff. Food is also often advertised in a very enticing way to be able to create a sellable appeal to audiences. The products are further marketed as value meals which creates a perception to the public that they have cheap and yet tasty food that is available at outlets.
Another outstanding point is that it is often deemed as a family fast food restaurant for the whole family with commercial advertisements showing families visiting Macdonald’s together to enjoy a meal. Happy meals are bought for the kids and the whole family is shown to be happy and satisfied with their experience. The awareness it creates for audiences is of great impact as people now view Macdonald’s as a family friendly restaurant where people have a fun experience dining at. The impression gained is that Macdonald’s has a great organizational culture, in creating value for money meals that are tasteful and fun for everyone, creating many jobs and training staff to be dedicated and committed, creating new promotions and deals to entice consumers and having great advertising to sell its products. Also sometimes, during major events, such as the Olympics, Macdonald’s as one of the sponsors for the athletes gives away Olympics related glasses as part of their promotions. Every week, a new coloured glass is given away which sometimes encourages people to buy their value meals just to collect the glasses. This tells people Macdonald’s has a great way of promoting the Olympics and also giving away related merchandise to allow people to have a piece of the Olympics.
Slogans can also be very strong words in a campaign to create awareness. If it is distinctive enough, it will appeal to the masses and be remembered easily. It also links the campaign to it and causes association with certain feelings if that is what the campaign seeks to achieve. In doing so, it creates a very effective awareness in the campaign and in the case of an organization, it showcases the company’s culture and educates the public about the way things are done at the company. The slogan of Macdonald’s is “I’m loving it.” It is also its current global campaign (Macdonald’s 2012). The slogan is sung during commercial jingles and is always placed under the distinctive “M” logo of all of Macdonald’s posters, paper bags, plastic bags and signboards. The reason behind this slogan was to create themes of inspiration, passion and fun. This slogan alone is signature and distinctive enough for anyone to know that it belongs to Macdonald’s and that alone has a powerful marketing value. With “I’m loving it,” consumers have a good feeling about Macdonald’s as an organization as it is deemed as one of their main objectives to satisfy hungry and age varying customers.
How culture has affected an organization
In having a distinct and well developed organisational culture, companies’ strategic decisions, options and actions are directly affected. How a company conducts itself and its operations, how it relates to the public and how well it does depends on the culture practised and nurtured.
A well organised company structure would have effective mission objectives and targets to achieve and also commitment to reaching those objectives with dedication. A company which prides itself on being highly committed to serving its customers quality food is Macdonald’s. With customer satisfaction their priority, it is highly vital for restaurants to cook their food quickly and most importantly it has to be tasty. In order for the public to understand this better, Macdonald’s in Singapore has recently launched an ‘Open Doors’ campaign with a slogan, “love the truth about our food” (Macdonald’s Singapore 2012). It is a kitchen tour showcasing the high standards that the employees practise and maintain in serving hot and fresh food to customers. In the tour, they emphasize on preparing food only upon the customer placing an order to guarantee freshness. Also, they emphasize on being nutrition friendly with no trans fat and cholesterol. This tour is to bring the customers closer to understanding Macdonald’s culture of caring and servicing its customers well and also having high standards to ensure quality food that will satisfy them. Not only does this initiative create excellent public awareness, its decision to carry out this campaign showcases its company aesthetics and well structured policies, standards and employee commitment.
In my opinion, I feel that the very basis of how well a company manages itself is the very core values that they believe in and work towards to. Without properly structured organisational culture cultivated, there can be no strategic management. This will thus adversely affect business and cause deterioration in standards and quality, be it in product or service. Many huge successful companies that own franchises have very distinctively strong organisational culture that they are instantly recognised by the mass public. Companies like Apple or Dominos are distinctively known for their great customer service and quickness respectively that when you think of such names, you know what they are well known for.
Should a company fail to be driven by a set of proper cultures, there would not be any proper leadership at any level and the organisation would be obsolete with no management skills whatsoever. Furthermore, with no set of goals and objectives and creeds to live and work by, employees would be emotionally detached from the company and work quality and dedication would be affected greatly. There would be no motivation for employees to come to work as they would not be driven to work towards any form of achievement. Rigidity will also suffice in the organisation should employees not be granted some form of effective training programme. If this were to happen, problems that can be solved by a professional employee who is well trained and committed would have to be relayed back to the top management which would create a chain effect of poor communication and lack of sufficient empowerment in certain areas. And when the employees lack commitment and training, the end result is poor quality, service and/or product which would cause loss in manpower, business, sales, partnerships, corporate deals, joint ventures, reputation, trust and such.
Ultimately, I feel that the importance of organisational culture is highly fundamental and crucial in developing efficient and justified strategies in managing any organisation. The negative results without having good culture are extremely high and the losses are too costly and drastic for any company to risk. Therefore, it is of high regard that companies develop their organisational culture from the beginning stages of the development of the company and continuously work towards building it up. The benefits that would be reaped would be much greater especially if the company becomes renowned for its culture and great effectiveness and efficiency in what they do. Their reputation would be known worldwide and their brand would be trusted by the corporate world and mass consuming public as well.
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