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CORPORATE CULTURE
Aco MomcilovicHR Specialist
L’Oreal Adria d.o.o.
Content
• Introduction• Different Models• Why it is important• Cultural Fit• How it is created (Examples, Interpretation)• Cultural Interview• Does It Make Difference? (Effectiveness)• Examples• Finish
Artifacts (visible organizational structure and processes)
Values (strategy, goals, philosophy)
Assumptions (unconscious beliefs, perceptions and feelings
Group Interaction
Shared Values
Norms of Behavior
Positive Results
CULTURE
The emergence of culture
Strategic fit
com
munic
ati
on
com
munic
ati
on
com
munic
ati
on
“Vision”(to be)
Current situation“As it is”
“Cult
ure
” (H
ow
to b
ehave a
long t
he w
ay)
“Str
ate
gy”
(W
hat
do w
e n
eed t
o f
ocu
s on)
DIFFERENT MODELS
Flexibility
Control
Internal External
Open Systems Model:
Rational Goal Model:
Human Relations Model:
Internal Process Model:
- Creativity- Inventiveness- Growth- Competiveness
- Task focus- Goal clarity- Efficiency- Performance
- Teamwork- Participation- Supportiveness
- Centralization- Routinization, formalization- Stability, continuity, order- Predictable performance outcomes
Matching Strategy: - Defender - Prospector - Analyzer
Goals: HRM Development, Morale
Cultural Values: (Consensual)
Goals: Growth, Resource Acquisition
Cultural Values: (Developmental)
Matching Strategy: -Prospector
Goals: Stability and Control
Cultural Values: (Hierarchical)
Matching Strategy: - Defender
Goals: Efficiency, Productivity
Cultural Values: (Rational)
Matching Strategy: - Analyzer
Role, Control, Goal and Soul Models
CONTROL
Effective Ineffective
• Unites effort • Limited by leader
• Moves quickly • Politics
• Strong leader • Isolated from bad news
• Clear direction • Overworked leaders
• Clear expectation • Information as power
• Loyalty • Short range thinking
Effective Ineffective
• Well designed systems
• Change is slow
• Clear lines of authority
• Low trust
• Structure • Following the rules
• Limit to personal power
• People as parts not human
• Efficient operations • Under-utilise talent
• Quick to learn jobs • Boundaries
ROLE
Effective Ineffective
• High motivation • Burnout
• Maximum use of talent
• Waste resources
• Rapid learning • End justifies the means
• Unity of effort • Isolated from reality
• Reduced controls • Inward focus
• Mutually valued goals
• Arrogant
GOAL
Effective Ineffective
• Good communication
• Task neglect
• Commitment • People before organisation
• High trust • Slow decision making
• Co-operation • Loses direction
• Caring and listening • Slow to change
• Sense of belonging • Frustrates ambition
SOUL
In Riding the Waves of Culture, Fons Trompenaars
• In the same way, we believe that effective organisations focus attention not on one culture, but on an appropriate balance of the four cultures so that the best attributes of each enable the organisation to thrive
• systemic model - described three levels of culture; 1) the explicit layer made up of artifacts and products and other observable signs, 2) the middle layer of norms and values and 3) the implicit layer, which is comprised of basic assumptions and beliefs.
Why is corporate culture so important?
• To survive and prosper in a ever-changing environment, adaptability is key
• industries need more than gradual adjustment to changing circumstances; we need to shift paradigms
• The central challenge: to create and lead an adaptive enterprise
Cultural Fit Research
• A&DC – effects of cultural fit
• when Cultural Fit is absent employees report lack of engagement with their employer and their colleagues
• In small and mid-size businesses, it’s common for the company culture to reflect the person at the top.
One More Time
• With some examples
Corporate Culture
Organization Culture Defined:
•Set of key behaviors, beliefs and shared understandings that are
shared by members of the organization.
•Defines basic organizational values and communicates to new members
the correct way to think and act.
•Each firm has a distinct culture.
Corporate Culture
Interpreting Culture:
Rites and ceremonies
- Elaborate planned events conducted for the benefit of an audience.- Used to reinforce specific values or create a bond among
people.- Four types of rites and ceremonies:
Rites of passage
Corporate Culture
Rites of enhancement
• Annual awards night.
• Enhances social identities and increase status of employees.
Corporate Culture
Rites of renewal
• Refurbish social structures and improve organizational functioning.
Rite of integration
Corporate Culture
Stories
- Narratives based on true events that are shared among organizational employees and told to new employees to inform them about an organization.- Stories keep alive the primary values of the organization.- Commonly include company heroes or historic legends.
Corporate Culture
Symbols
- Physical artifacts use to focus attention on a specific item. - Nordstrom example:
Language
- Includes slogans and metaphors.
- 3M – “at 3M the 11th commandment is never kill a new product idea.”
- YEGA
How to explore culture?
Culture Interviews
Does Culture Makes Difference?
System Effectiveness
Constructive cultures promote a greater “exchange” between the organization and members (and increase effectiveness)
Aggressive/Defensive cultures fail to enhance members’ contributions and outcomes (and thus promote turnover)
Passive/Defensive cultures reduce members’ contributions and outcomes (and reduce effectiveness)
System Effectiveness
Greater effortHigher performanceMore innovative solutions
• Member PerspectiveOutputs (to members) > Inputs (from members)
Higher satisfaction Lower stressGreater inclusion & integration
Passive/Defensive Cultures
• Approval (3)
• Conventional (4)
• Dependent (5)
• Avoidance (6)
Aggressive/Defensive Cultures
• Oppositional (7)
• Power (8)
• Competitive (9)
• Perfectionistic (10)
Constructive Cultures
• Achievement (11)
• Self-Actualizing (12)
• Humanistic (1)
• Affiliative (2)
Differences between employees
Life Styles Inventory(Descriptions by Others)
Effectiveness in Current Position
Top 10%
(n = 487)
Differences between employees
• Life Styles Inventory• (Descriptions by Others)
• Effectiveness in• Current Position• Bottom 10%
• (n = 459)
IMPACT on Performance
DefensiveCulture
ConstructiveCulture
682%
166%
Revenue
901%
74%
Stock Prices
756%
1%
Net Income
4X!
12X!
Metamorphosis
• Organizational Culture – National Culture
– National Culture has bigger influence than corporate
Different Examples
• Imagine few extreme cultures
Art GalleryVisible aspects of cultural organization
LIBRARY
Way to solve problems, documentation, politics, written communication ...
Church
Holy place. Strategy, goals, philosophy
CATACOMBS
CULTURES can be Changed!
• Who lives in caves?• Xerox• Daimler Chrysler• Civil Rights & Increasing Tolerance• NASCAR• Boston Red Sox / Chicago White Sox• The Catholic Church• From Communism to Capitalism
Leadership
• “Organizational cultures are created by leaders, and one of the most decisive functions of leadership made well be the creation, the management, and – if and when that may become necessary – the destruction of culture.”
• A Culture of Continuous Learning – Key to Improving Organizational Culture
THE END!
• How we do things round here!
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