Culture Structure Strategy and Power MBA Management Project 2007 Robin Dews

8/14/2019 Culture Structure Strategy and Power MBA Management Project 2007 Robin Dews

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Culture, Structure, Strategy and Power

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An investigation of organisational dynamics at Games Workshop

By

Robin Paul Dews

2007

A Management Project presented in part consideration for the degreeof Master of Business Administration


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Culture, Strategy, Structure and Power

An investigation of organisational dynamics at Games Workshop

1. Introduction and Rationale Page 4

1.1. Research Questions and Method 5

2. Literature review Page 8

2.1. The Differentiation/Integration paradox 8

2.2. Organisational Culture 9

2.3. The Dark Side of Organisational Culture 12

2.4. Strategy, Core Competence and Knowledge 13

2.5. The Hidden Champions 14

2.6. Core Competence and Learning 16

2.7. Organisational Structure 20

2.8. Organisational Power 23

2.9. Literature Summary 26

3. Research Method Page 29

3.1. The Management Sample 30

3.2. Interview Procedure 31

3.3. Strengths and Limitations of the Method 32

3.4. Selecting the Sample 33

4. The Case Study Games Workshop Plc Page 35

4.1. The Red and Black Books 38


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4.2. Symbols, Artefacts and Language 40

4.3. The Spirit of Games Workshop 42

5. The Dynamics of Power at Games Workshop Page 47

5.1. 1980s The Dominance of the Design Studio 48

5.2. 1990s - The Rise of Retail 49

5.3. 2000s - The March of Manufacturing 52

5.4. The Art of the Long View 55

6. Strategy, Power and Culture: Managerial Perceptions Page 56

7. Conclusion and Implications Page 62

7.1. Management Implications 65

7.2. Directions for Further Research 66

7.3. Looking to the Future 67

References Page 69

Appendix A Management Perception Survey Page 72

Appendix B Letter to Management participants Page 78


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1. Introduction and Rationale of the Project

This report explores the dynamics of organisational structure, strategy, culture and power at

Games Workshop Plc. I have worked for this company for over eighteen years and so its

characteristics are well known to me. However, as my understanding of organisational

theory has deepened throughout my MBA studies, I have also developed a more analytical

perspective on many of these characteristics. These insights have in turn prompted the

current work.

As a member of the senior management team at Games Workshop, what has really come to

intrigue me is how culture, structure, strategy and power interact within the organisation

and whether an increased awareness of the dynamics of these forces might help inform

future management thinking. The rationale of the study therefore, is first of all to look at

what is going on inside Games Workshop from both a current and historical perspective. I

then subject these observations to scrutiny through the lens of current theory, in order to

both contextualise them and evaluate their relevance and validity. Finally, I conduct a piece

of primary research and analyse and draw conclusions that I hope will be of long-term value

to the business in its future management decision making.

Within Business Studies; culture, structure, strategy and power have each been subject to

substantial investigation by a broad spectrum of writers and academics, leading to an

accompanying library of literature. It was therefore essential for the project that I could

identify those areas of the writing and research that would have bearing and relevance for

the case study.


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At the core of this project is an examination of how Games Workshop has managed the

integration-differentiation paradox (Child 2005) over a fifteen to twenty-year period and

how the strategies it has employed have impacted upon the culture, structure and

performance of the business. According to Scheins (1985) definition, culture consists of an

emergent pattern of behaviours through which an organisation manages the challenges of

internal integration and external adaptation. Business strategy too is focussed on matching

internal competencies to the external environment. These two organisational dimensions,

like the face of Janus - simultaneously look inwards and outwards and are always finely

balanced with the bridge between them being the structure of the business itself and the

power relationships within it. As we will see, in the course of the literature review, I have

indeed been able to identify some key theoretical work that helps to illuminate and

contextualise the research.

My second task was to frame my research questions in a way that would not only enable me

to develop an appropriate research method, but that would also have relevance for the staff

and management at Games Workshop. Furthermore I was keen that this research might

develop a validity beyond the specifics of the case study and that it would be of interest to

other management practitioners and students of organisational theory.

1.1 Research Questions and Method

In undertaking cultural research it is notoriously difficult to isolate specific variables due to

the complex interplay of cause and effect. This was even more the case in my study as I

also wanted to explore how the organisational culture played out with the dynamics of

structure, strategy and power. I therefore decided quite early on in this work that what was

important was not to boil down the research to some possibly quantifiable but potentially


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meaningless statistics, but to stay with the richness of the material and see where it led me.

What is critical in all cultural management studies is not simply what seems to be going on

on the surface, but how that visibility is perceived, interpreted and contextualised by

managers and staff across the business. It is within this constantly emerging social reality -

what is called the negotiated order of the organisation (Strauss et.al.1963) - that we are

likely to get a real glimpse of the underlying dynamics behind the visible forms.

My key research question therefore is:

How is the managements perception of culture, business strategy and power

currently distributed across Games Workshops functional divisions?

Having obtained a satisfactory answer to this question, I hope then to be in a good position

to draw a number of inferences. The most important of these is:

Does this revealed pattern, enhance or diminish the ability of the business to make the

optimum strategic choices for its future survival and growth?

As I have said, I have been employed in the business, at a management level, since the late

1980s and so my chosen research method is that of a participant observer. This allows me

to draw upon my own experiences, insights and observations of the organisation over an

almost twenty year period. In addition, throughout the summer of 2007, in order to address

my key research question, I conducted a series of structured and recorded interviews with

senior managers from across the business. The purpose was to explore and quantify their

views on the dynamics of culture, structure, strategy and power at Games Workshop. I set


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out to test the hypothesis that individuals from these three areas would have quite different

perceptions of these dynamics and that these perceptions would be contingent upon their

understanding of where the power lay in the business.

Finally I would like to explore the hypothesis that in pursuit of superior operational and

manufacturing characteristics, the business has arrived at a point where power in the

organisation no longer resides in an area that is valued by its customers and that this is one

of the underlying problems behind the recent challenging commercial conditions the

business has faced.

My extended association with this company has provided me with a unique long view

from which I hope to apply insights from a range of academics and writers. I make

particular use of this long view in the discussion of life cycles and learning at Games

Workshop and in the analysis of how the centre of power has shifted within the organisation

drawing on the Hickson et.al. (1971) contingency model of intraorganisational power

As Watson (2006) has articulated, there is a deeper form of common sense that he calls

critical common sense. This is an analysis built upon the basic logic, rationality and level-

headedness to be found in human beings whenever they step back from the immediate

situation and critically put their minds to an issue or problem (Watson 2006, p11). Its in

this spirit that I aim to approach this study. However, at the same tine, I must also

acknowledge the fact that Games Workshop is an organisation for which I have worked for

a long time. As such, I am deeply embedded within its culture, and it is possible that some

of its essential underlying values and assumptions are simply no longer visible to me.


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2. Literature Review

2.1 The Differentiation/Integration paradox

The focus of this project is an examination of how organisations and in our case study,

Games Workshop Plc have adopted specific strategies and structures in order to deal with

the integration-differentiation paradox. The essence of this problem is that in order to

effectively deliver goods and services, organisations have to create differentiatedsub-units

Sales and Marketing, Research and Development, Manufacturing and Distribution etc. each

with their own staff, ways of working, characteristics, cultures and organisational power.

At the same time, in order to deliver value to customers, and ensure their own future

financial survival, organisations have to be highly integrated that is they have to join all

these different functional units together into a seamless whole.

As Child (2005) puts it: Integration signifies cohesion and synergy between different roles

or units in an organisation whose activities are different but interdependent in the process of

creating value.

In fact you could argue that the single unifying characteristic of allsuccessful businesses is

that they are able to continuously monitor, manage and resolve these two contradictory

tendencies and that the glue that binds such organisations together is a strong organisational

culture.

At the core of the investigation therefore, is an examination of how the dynamics of culture,

structure, strategy and power have played out historically within Games Workshop and


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their impact on the organisation today. I therefore take each of these concepts in turn,

review the relevant literature and provide a theoretical context for the investigation.

2.2 Organisational Culture

Over the last three or four decades, managers, academics, writers and students of business

have seen an absolute upsurge in the attention given to organisational culture as one of the

key characteristics and driving forces in the delivery of competitive advantage across a

wide range of businesses and organisations.

The idea of strong organisational cultures as determinants of commercial and economic

success began to take hold in the late 1970s and early 1980s. Ouchi and Williams (1985)

describe how this explosion came about as a result of the widely held perception, during

this period, that Japanese companies had superior operating capabilities, but the then

dominant approaches to organisational research emphasised formal structures and so failed

to uncover any difference between Japanese and western firms. As a consequence, scholars

began to examine the possibility that the different national cultures might have penetrated

modern corporate forms, thus creating differences in organisational culture between, say,

Nissan and General Motors. Several early studies gave credence to this approach, which led

next to the possibility that even within a single national culture there might be local

differences between the culture of firms, e.g. between Hewlett Packard and ITT. (Ouchi

and Wilkins 1985, p458)

This notion of individual corporate culture as a purveyor of competitive advantage reached

its most widespread and populist appeal in Tom Peters and Bob Watermans (1982)

bestseller In Search of Excellence. Presented with the pace of a detective thriller and


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packed full of self-evident homilies such: A Bias for Action, Close to the Customer and

Productivity through People, it argued that success in the new global market was going to

depend up corporations developing strong people centred values - upon culture!

In the subsequent decades since Peters and Watermans publication, many other writers,

academics and theorists have entered the arena. At its core, this notion of developing strong

business cultures is almost common sense and therein lays its appeal. As human beings,

the notion of culture is so intrinsically embedded in our individual and social psychologies

that we live with it at a largely unconscious level. We only really become aware of it when

we encounter a different culture either on holiday, changing jobs at work, or engaging

with a new social group. In each case, we are rapidly led from the visible manifestations of

difference dress, habit and behaviour - into the underlying values and assumptions in

which our own cultural experience is rooted.

Definitions of organisational culture abound but, for the purposes of this report, I am going

to go back to Schein (1985). As Hatch (1993) has commented; (he)was especially

influential because he, more than the others (including anthropologists and folklorists),

articulated a conceptual framework for analysing and intervening in the culture of

organisations. (Hatch 1993, p.657)

According to Schein, culture exists simultaneously on three levels: on the surface are

artefacts, underneath artefacts lie values, and at the core are basic assumptions (Fig 1)

Assumptions represent taken-for-granted beliefs about reality and human nature. Values are

social principles, philosophies, goals and standards considered to have intrinsic worth.

Artefacts are the visible, tangible and audible results of activity grounded in values and

assumptions. In Scheins words, culture therefore is:


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a pattern of basic assumptions that a given group has invented, discovered, or developed

in learning to cope with its problems of external adaptation and internal integration, and

that have worked well enough to be considered valid, and therefore to be taught to new

members as the correct way to perceive, think and feel in relation to these problems.

Figure 1. Artefacts, Values and Assumptions after Schein (1985)

Although on Scheins (1985) version of the diagram, he incorporates the arrows to show

that these three elements are in constant interplay, it is often pictured in management texts

as a floating iceberg. This is done to draw the analogy that just as nine-tenths of an

icebergs mass is hidden below the water, in the same way the mass of culture is also

invisible, with only artefacts, language and behaviours visible above the surface. This is all

well and good, but it risks presenting organisational culture as something that can be

literally frozen, rather than the dynamic interplay of structure, purpose, value and

meaning, in a process that is continuously emergent or becoming.

Artefacts

Espoused beliefsand values

Underlyingassumptions

Visible organisational

structures and processes(hard to decipher)

Strategies, goals,Philosophies(espoused justifications)

Unconscious, taken-for-grantedbeliefs, perceptions, thoughtsand feelings.(ultimate source of values andaction)


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2.3 The Dark Side of Organisational Culture

Although much of the writing and research on strong organisational cultures has focussed

on their potential to raise business performance, there is also inevitably a dark side. A

number of writers (Willmott 1993; Casey 1999; Ogbonna and Wilkinson 2003) have looked

at how the attempt to increase compliance amongst a workforce through management

control of corporate culture can also produce high levels of dissonance, stress and anxiety.

Casey used the term psychic accommodation to describe the process by which the

organisation selects and shapes in the employee certain kinds of orientations that achieve an

appropriate fit between the requirements of the organisational culture of work and the

character of those who work within it. A successful employees values, attitudes and

general orientation must correspond with those promoted by the organisational culture.

Consequently specific traits and attitudes that are useful to the work and the team are

stimulated and rewarded and those that are unnecessary or that impede the process of the

workplace culture and therefore of production are thwarted and suppressed. (Casey 1993,

p164)

He goes on to describe the way in which a lack of or change in their level of congruence

with the company culture can result in job related stress and in some cases dismissal.

Individuals unable to successfully adapt to the new cultural conditions that require such

normalisation and repression are told that they do not fit with the culture (in the words of

a manager from corporate HRM) and are encouraged to leave the company. (Casey 1993,

p167)


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2.4 Strategy, Core Competence and Knowledge

Business Strategy is an academic discipline in its own right and well beyond the scope of

this project to fully illuminate but, as with culture, it is important to establish some core

principles and then match those principles to the observed data and behaviour of our case

study.

Although definitions of strategy abound, at the core is the idea of an organisation

developing a clear set of goals or objectives from which it can begin to create the means to

achieve them. However this view of strategy as planning plays into the systems-control

orthodoxy (Watson 2006) that suggests that the organisation can be designed or engineered

as a machine in order to optimise its outputs. This view of strategy has it roots in the

military antecedents of business strategy and usually involves a strategic hierarchy of goals,

policies and programmes coupled to a timetable against which strategic progress can be

measured.

On the other hand, strategy can also be seen as putting in place a system of management

that will facilitate the capability of the organisation to respond to an environment that is

essentially unknowable, unpredictable and therefore not amenable to a planning approach.

This perspective is much closer to the process-relational means of framing an organisation

(Watson 2006). Burns and Stalker (1961) in their classic text also describe the management

of organisations on a continuum between what they describe as organic and mechanistic,

that is contingent upon the external environment (stable or dynamic) and the internal

operations of the business (innovative or steady state).


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2.5 The Hidden Champions

When looking at strategy from the perspective of the case study, there are two issues that

require highlighting. First of all, Games Workshop describes itself as a niche business and

the company operates largely within a market and industry of its own making. Much of the

academic material on strategy has been developed from the perspective of large

corporations where the classical models such as Porters five-forces (Porter 1979:1980) do

indeed have a real world veracity. With the notable exception of Simon (1996), very few

commentators have looked at what he calls the hidden champions, businesses that operate

in highly specialised markets and with quite different rules. Specifically Simon

characterises these hidden champions as possessing a number of characteristics that we

can observe in Games Workshop.

In particular, he makes the following observations that are pertinent to our case study.

According to Simon (1996) thesecompanies prefer to remain hidden they avoid publicity

and dislike advertising. Despite being a company with sales in excess of 100m, Games

Workshop does not advertise and puts all of its resources into direct customer contact

through the staff in its stores, magazine publications and the web.

Simon further describes these companies as making; a big splash in a small pond with

their goal of becoming number one in a tightly defined market. These businesses are

frequently one product companies but rather then being seen as a weakness, this doesnt

bother them one bit! In the case of Games Workshop the product range is both narrow

(fantasy games and miniatures) and at the same time very deep (with literally thousands of

individual products) and the company defines its goal as being the biggest toy soldier

company in the world.


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These businesses also have global scope - they combine a narrow market focus with a

global orientation. They choose to deal as directly as possible with customers around the

world and seek to service them wherever they are. Games Workshops CEO Tom Kirby

wrote in the 2002 Annual Report: This is what Games Workshop does; we create materials

of the highest quality that appeal to a minority of the population. The challenge for us is not

to try to get everybody to buy our products but to reach out and find the people who want

them, anywhere in the world. In order to do so we sell wherever we can. We have our own

Hobby stores that serve to introduce people to the Hobby our marketing if you will. We

work with independent retailers of many types. And we sell direct both on the internet and

by mail order. These channels should work in harmony together, each providing a different,

but complementary, service.

For all of the hidden champions sales are not based on price.Their message is of value not

price and they believe that quality remains long after the price is forgotten. The most

important competitive advantage is product quality and the least important is price with the

result that they constantly innovate.They strive for continuous innovation in both products

and processes and pay equal attention to internal competencies and external opportunities in

all aspects of their business for example; gaming tables inside stores and shops that

function as hobby centres. These businesses also have little competition they create clear-

cut competitive advantages in both products and service and then defend their competitive

position ferociously.

Operationally, they are often highly vertically integrated or with very long-term supplier

relationships. They rely on their own operational strengths, keeping core competencies

within the company but outsourcing non-core activities. They also have a strong corporate


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culture and a leadership style that is autocratic on principles but participative around details.

Hidden champions pay the utmost attention to the selection of leaders, observing their unity

of person and purpose, energy and perseverance, and the ability to inspire others.

The value of Simons (1996) Hidden Champions for our research is that it provides a

relevant and wider contextual framework from which we can examine the cultural strategic

and power characteristics of Games Workshop. This will support our attempt to identify

those elements that are specific to our case study and those that have a broader business

verisimilitude.

2.6 Core Competencies and Learning

The work by Hamel and Prahald (1990) on core competencies has articulated a different

view of strategy which they define as: the collective learning in the organisation,

especially how to co-ordinate diverse production skills and integrate multiple streams of

technologies

The epithet learning organisation has become something of a business school clich, but

as Nonaka (1991:97) elegantly puts it: creating new knowledge is not simply a matter of

processing objective information. Rather it depends on tapping the tacit and often highly

subjective insights, intuitions and hunches of individual employees and making these

insights available for testing and use by the company as a whole.

The philosopher Michael Polanyi (1966) coined the phrase; We know more than we can

tell. What he was trying to say, was that knowledge is embedded in human beings at a far


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deeper level than simply the conscious intellect. Our knowledge is also deeply rooted in

action and in an individuals commitment to a specific context.

Boisot (1995) proposed a descriptive typology that characterised knowledge as codified or

un-codified and un-diffused or diffused. Codified knowledge is knowledge that can

be stored or put down in writing without undue loss of information, such as stock market

prices, software code and legal statutes; while un-codified knowledge is knowledge that

cannot be captured in writing or stored without losing the essentials of the experience it

relates to, such as recognising a face, operating complex machinery, or playing the piano.

Diffused knowledge is shared with others, such as radio broadcasts, published reports and

press releases, while undiffused knowledge stays locked inside ones head whether it is

hard to articulate or because one decides to keep it there, such as company secrets,

childhood memories, and personal fantasies (Boisot 1995, 145.) (Fig 2)

Figure 2. Typology of Knowledge after Boisot (1995).

The application of Boisots (1995) definitions to a two by two matrix generates four new

characterisations of knowledge as Proprietary, Public, Personal and Commonsense (Figure

2). For example: Public knowledge is codified and diffusible. It is what we conventionally

regard as knowledge in society and can be found structured and recorded in textbooks,

ProprietaryKnowledge

PublicKnowledge

PersonalKnowledge

CommonsenseKnowledge

Un-diffused Diffused

Codified

Un-codified


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research journals and other formal and informal printed sources (Choo 1998, p.110).

Furthermore, we can go on to describe each of the other classifications in a similar way.

Nonaka (1994) has built upon this style of typology by proposing a theory of how

knowledge is created and transformed within an organisation. Polanyi (1966) classified

human knowledge into two categories Explicit and Tacit and Nonaka (1994) uses these

concepts to generate two dimensions of knowledge creation. Explicit or codified

knowledge refers to knowledge that is transmittable in formal, systematic language. On the

other hand, Tacit knowledge has a personal quality, which makes it hard to formalise and

communicate. Tacit knowledge is deeply rooted in action, commitment and involvement in

a specific context. In Polanyis words, it indwells in a comprehensive cognisance of the

human mind and body. (Nonaka 1994, p.16). He then takes these two polarities and uses

them to demonstrate how knowledge is transformed within the organisation through four

different modes that he characterises as Socialisation (tacit knowledge to tacit knowledge),

Externalisation (tacit knowledge to explicit knowledge), Internalisation (explicit knowledge

to tacit knowledge and Combination (explicit knowledge to explicit knowledge). (Fig 3)

Figure 3. Modes of Knowledge Creation after Nonaka (1994)

Tacit

Knowledge

Tacit Knowledge Explicit Knowledge

Explicit

Knowledge

To

From

Socialisation Externalisation

Internalisation Combination


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Nonaka states that knowledge: is created by individuals. An organisation cannot create

knowledge without individuals. The organisation supports creative individuals or creates a

context for such individuals. Organisational knowledge creation therefore should be

understood in terms of a process that organisationally amplifies the knowledge created by

individuals and crystallizes it as a part of the knowledge network of the organisation

(1994. p.17)

Furthermore, there is a temporal component to this knowledge transformation. As the tacit

knowledge of individual experience is captured and documented by the organisation

through externalisation, it subsequently becomes available to other members of the group

who in turn bring it into their own realm of experience by means of internalisation. Over

time, this spiral of knowledge creation enables the organisation to both create new

knowledge and transform and diffuse it throughout the entity.

As we will see, these ideas of competitive advantage and organisational learning are of

particular interest to our case study because of the extremely high degree of vertical

integration that it exhibits. In several of my research conversations with managers from the

manufacturing division they stated that the explicit strategy of Games Workshop

Manufacturing was to: make the best toy soldiers in the world, better than anyone else in

the world. What this is saying, is that the make or buy decision depends upon

organisational knowledge and that the application of this knowledge to its operations

provides Games Workshop with a core competitive advantage. This continual,

development, refinement and application of organisational learning and knowledge is also

one of the key characteristics of Simons (1996) hidden champions who largely occupy


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markets and industries of their own making and with products that have unique

informational characteristics.

2.7 Organisational Structure

In the fifteen years since Tom Kirby led the management buy-out in 1992, Games

Workshop has grown tenfold from 250 staff all based in the UK, to over 2500 people

worldwide. We now turn to the literature on structure in order to examine how an

organisation has to change and adapt as it moves from its early entrepreneurial phase of

development, characterised by a loosely bureaucratised set of management processes with

indirect control practices, to a more tightly bureaucratised structure with much more direct

control practices. This analysis brings together ideas from contingency thinking with work

on organisational life cycles.

The insight of contingency thinking (Burns and Stalker, 1961) is that the structure and

culture of organisations is both emergent and adaptive and will conform to the broad pattern

of activity in which they are engaged. As Watson summarises it: Their (Burns and

Stalkers) research showed that the companies they studied which manufactured products

for a stable market, requiring little innovation in product or method, tended to perform

better in business terms if they worked in a mechanisticor tightly bureaucratic manner

than one that did not. Companies in which there needed to be much more innovation

because of changing conditions which give rise to fresh problems and unforeseen

requirements for action (Burns and Stalker, 1961, p.121) found it necessary to adopt

organic or loosely bureaucratic management systems if they were to succeed in the

relatively turbulent business environment with which they were faced (Watson, 2006,

p.273)


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This structural/contingency approach, links together with the life cycle work of Greiner

(1972) and other researchers (Downs, 1967; Lippitt and Schmidt, 1967; Katz and Kahn,

1978). Each has described a series of predictable stages that an organisation passes through

as it develops from an entrepreneurial start-up to a mature business. In Greiners model

each phase of growth is followed by a crisis that necessitates a change in the way that the

business is structured and managed in order for it to continue to develop.

Greiners (1972) first phase is that of entrepreneurial creativity. This initial burst of energy

and enthusiasm leads to a crisis of focus and leadership that requires a more directive style

of management. As the business grows, it then meets a crisis of autonomy as it is no longer

possible for an individual to direct the work of the whole enterprise. In a successful venture

this problem is resolved by the creation of management teams and a period of delegation

which in turn leads to a crisis of control and a subsequent era of co-operation between

management and the work force.

At this stage the enterprise will have ceased to have many of the characteristics of the

owner-managed firm because there are set procedures and policies for doing things. The

danger at this point is that the firm might lose its initial entrepreneurial drive and the next

crisis it will face is one of red tape and bureaucracy. Greiner proposes that this can only be

overcome by a strategy of collaboration making people work together through a sense of

mission and purpose rather than by reference to a rule book. (Fig 4)


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Figure 4. Model of Organisation Development after Greiner (1972)

Greiner notes that as each new developmental crisis is encountered, there is a temptation for

senior managers and directors to look back into the past in order to find a solution. There is

an inevitable yearning for a simpler time, often in the remembered past, and so you hear

managers saying things such as: Why dont we have the spirit of excitement we used to

have? and so forth. He argues that: The critical task for management in each of the

revolutionary periods is to find a new set of organisational practices that will become the

basis for managing the next period of evolutionary growth. (1972, p.58).

Greiners (1972) model is one of a number of accounts of organisational life-cycles. Quinn

and Cameron (1983) have conducted a thorough review of a number of the different life-

cycle models which attempt to correlate organisational effectiveness with life stage.

Although most researchers agree in their characterisation of organisational growth into a

number of different phases, the number and content of these varies from author to author.

Phase 1: CrisisLeadership

Phase 2: CrisisAutonomy

Phase 3: CrisisControl

Phase 4: CrisisRed Tape

Phase 5: Crisis???

Phase 1: GrowthCreativity

Phase 2: GrowthDirection

Phase 3: GrowthDelegation

Phase 4: GrowthCo-ordination

Phase 5: GrowthCollaboration

Revolution

Evolution

Age of Organisation

Size of Organisation

Large

Small

Young Old


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Commentators such as Daft (2004) describe four main stages Entrepreneurial,

Collectivity, Formalisation and Elaboration. Katz and Kahn (1978) utilise three Primitive,

Stable and Elaborative. Judith Simon (2001) in her study of non-profit organisations

describes five Imagine and Inspire, Found and Frame, Ground and Grow, Produce

and Sustain and Review and Renew- and as weve seen, Greiner (1972) also makes use

of five. Although it is appears very difficult to define the precise boundaries of these

phases, intuitively the insight feels right that an organisation will indeed pass through a

number of developmental stages in a predictable sequence, although at any point in time, an

institution may display the characteristics of more than one segment.

The key critique of this kind of life-cycle analysis is that it is overly deterministic and does

not allow for management decision making and actions, unlike the structural contingency

approaches postulated by Burns and Stalker (1961). However I believe that it simply

provides an additional investigative tool that neither diminishes the insights of contingency

thinking nor interferes with the dimensions of strategy, structure, culture and power that are

the focus of this investigation.

2.8 Organisational Power

In examining the role of power within the structure, strategy and culture of Games

Workshop, I draw in particular from the work of Hickson et.al.(1971). In their 1971

Administrative Science Quarterly paper A Strategic Contingencies Theory of

Intraorganisational Power they draw upon Lawrence and Lorschs (1967) definition of an

organisation as a system of interrelated behaviours of people who are performing a task

that has been differentiated into several distinct subsystems (Lawrence and Lorsch. 1967:

3) but use it to explore the nature of organisational power.


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Drawing on insights from Emerson (1962) and Perrow (1961:1970) on power as a property

of the social relationship not of the actor they argue that when organisations are conceived

as interdepartmental systems, the division of labour becomes the ultimate source of

intraorganisational power and power can be explained by reference to the variables that are

elements of each subunits task, its functioning and its links with the activities of other

subunits. They then go on to develop their theory of organisational power based upon three

dimensions or organisational characteristics; managing uncertainty, non-substitutabilityand

centrality.

Managing uncertainty (or de-risking the future)

The first dimension of power that Hickson et.al.(1971) deal with is that of future

uncertainty. They postulate that if the central problem facing modern organisations is

uncertainty, then power in the organisation will be partially determined by the extent to

which one of the subunits copes with these uncertainties better than others. The essential

notion here is one of de-risking the future. For both individuals and organisations the future

can never be known so we are constantly faced with uncertainty with its attendant risks. We

therefore, again as individuals and in organised groups, develop strategies for managing this

risk by attempting to build certainties or create contingencies to mitigate any negative

impacts. This is also one of the key areas in which our four variables of culture, structure,

strategy and power interlock. A core concept in strategic business studies is that of

managing the internal integration of the organisation and equipping and adapting it to

survive and thrive in its chosen environment. Again we see these similar concepts of

internal integration and external adaptation in Scheins (1985) cultural definition and so we

are right to believe that we are dealing with a slightly different framing of closely related

issues here.


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Substitutability

The second element that Hickson et.al (1971) consider a key dimension of organisational

power is the notion of substitutability. They define this as: the ability of the organisation to

obtain alternate performance for the activities of a subunit (Hickson et.al. 1971 p.221) and

suggest that the lower the substitutability of the activities of a subunit, the greater its power

within the organisation. thus a purchasing department would have its power reduced if

all of its activities could be done by hired materials agents, as would a personnel

department if it were partially substituted by selection consultants or by line managers

finding their staff themselves. Similarly a department may hold onto power by retaining

information, the release of which would enable others to do what it does. (Hickson et.al.

1971 p.221).

Given the tendency of commercial and industrial organisations to differentiate their

structure in order to improve operational efficiencies and develop core competencies, we

can see how differentiation will almost inevitably lead to the development of low

substitutability as knowledge and expertise are consolidated within the organisational

subunits. We also know from our cultural analysis that, over time, these differentiated

subcultures are also likely to develop their own cultural characteristics with attendant

communication and behavioural challenges to organisational integration.

Centrality

The third characteristic that Hickson et.al (1971) consider to be an essential dimension of

organisational power is the notion of centrality. What they mean by this is the degree to

which the activities of a subunit are interlinked into the system as a whole and in particular

the workflows of other subunits, a concept they call pervasiveness. Furthermore, they argue


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that; the activities of a subunit are central if they are essential in the sense that their

cessation would quickly and substantially impede the primary workflow of the organisation.

This workflow immediacy is defined as the speed and severity with which the workflows of

a subunit affect the final outputs of the organisation. (Hickson et.al. 1971. p.222)

They therefore hypothesise that the higher the pervasiveness, and immediacy of the

workflows of a subunit, the greater will be its power within the organisation.

Clearly power is a multi-dimensional concept and a full discussion of the nature of personal

power, organisational power and their first cousin, leadership are beyond the scope of this

project. I will therefore make use of Watsons (2006) definition of power as: The capacity

of an individual or group to affect the outcome of any situation so that access is achieved to

whatever resources are scarce and desired within a society or a part of that society.

(Watson 2006 p.202). The key notions here are the ability to influence future outcomes in

order to obtain access to resources.

2.9 Literature Summary

The subject of this study is the interaction of structure, strategy, culture and power and so

our review has had to cover a lot of ground. Before turning to the case study itself I want to

briefly summarise our findings and highlight where they have specific relevance to our

research.

First of all we touched on the core problem faced by many business organisations; that of

integration and differentiation. Although differentiation can and does produce operational

efficiencies one inevitable by-product is the emergence of organisational subcultures that


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can significantly hamper the ability of the organisation to integrate these outputs into

customer facing goods and services. One powerful way to mitigate these disintegrating

effects is through the development of a strong organisational culture that can act as a

unifying counterbalance, facilitating communication and providing a commonality of

values and behaviours across the group.

We then looked in much greater detail at the emergence and development of cultural

thinking within organisational studies and identified Scheins (1985) work as key in

understanding the relationship between the overt and covert elements of culture. Although

throughout the 1980s and certainly in the business softback literature there appeared to be

a belief that simply having a culture must be a good thing, we identified that there was

also a dark side to organisational culture particularly in terms of employee fit.

Organisational and business strategy has a vast and generic literature, but the specialised

nature of a case study requires a rather more tailored approach. Simons (1996) work on the

hidden champions specialised businesses that operate in niche or under the radar

products provides such a framework. Although operating in diverse and unrelated markets,

these companies have a significant number of common underlying characteristics such as;

high levels of vertical integration, strong corporate culture, an obsession with product

quality and an unusually high degree internal knowledge creation and propriety expertise.

These characteristics are all observed in our case study.

Using the hidden champions as a framing device, we then incorporated the ideas of core

competencies and in particular the work of Nonaka (1991) on the creation and

transformation of knowledge within an organisational setting.


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Organisational structure is another huge area of interest and research and it is impossible to

review this area without drawing on the work of Burns and Stalker (1961) and their

identification of organisational structure as an adaptive process that conforms to the broad

pattern of activity in which the business or division is involved. This insight was important

to my research design, that looks at perceptions of culture, strategy and power from the

perspective of managers from three different divisional areas of the business, each

representing a spread between highly mechanistic and more loosely organic management

approaches. Given that we will be looking at the case study from an almost twenty-year

long view, I also wanted to incorporate the literature on organisational life cycles (Greiner:

1972) (Lippitt and Schmidt: 1967). Although some of this work has been criticised for

proposing an overly deterministic view of organisational development that appears to exist

outside of management control, I believe that it provides a valid framework for reviewing

some of the passages in the growth and development of our case study.

Finally, we looked at the literature on organisational power. Here we draw almost

exclusively upon Hickson et.als (1971) strategic contingencies approach. This provides a

powerful tool not only for analysing the current distribution of power within the case study,

but also for looking at how it might have changed and developed over time. This links the

dimensions of power, with those of structure over time and so forms a core component in

my research.

Having reviewed the relevant literature, we can now look in more detail at the methods

well use to explore the veracity of our research question in relation to the case study.


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3. Research Method

My primary research method is that of a participant observer. In this role, I not only draw

from my own knowledge and experience of the organisation, but also make use of internal

documents such as books and films, as well as public materials such as the companys

annual reports. I have also taken insights from many informal chats and conversations with

managers and staff across the business. However, in addition to this material, I also wanted

to acquire some new empirical data that would help me better understand how the cultural

values, business strategy and management power were perceived to be distributed across

the organisation. Once acquired, this data, together with my own insights into the

development and operation of the business would provide me with material from which to

draw inferences as to whether this revealed pattern enhances or diminishes the ability of the

business to make the optimum strategic choices for its future survival and growth.

As already discussed, business organisations are normally segmented into three major

subsystems. These are the sales subsystem, the production subsystem and the research and

development subsystem. In the case of Games Workshop, these are known as: Sales,

Manufacturing and the Studio. In order to explore these ideas of cultural integration and

power, I conducted a series of structured interviews with managers and staff from across all

three subsystems. These interviews were conducted on-site during work hours using a pre-

prepared set of questions. Each interview took approximately an hour, and each one was

tape recorded for later analysis. I also took contemporary notes on responses that I thought

were interesting or significant. This enabled me to probe a little more deeply on areas that

were of interest to the investigation.


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3.1 The Management Sample

From an initial list of 24 individuals, I was able to conduct 17 interviews. Although

everyone I approached agreed to participate in the research, other commitments on the part

of some participants made it impossible for us to fix a mutual date and so I was not able to

include them in the sample.

Of the seventeen managers I spoke to, six were currently employed in Manufacturing, five

were from the Sales division and four were from the Studio. The remaining two were both

senior staff who, although currently employed in other parts of the business, had strong

historical connections with one or more of these areas. Over the last fifteen years, from the

early 1990s, Games Workshop has experienced rapid growth and so many of its senior

managers have had prior experience in more than one of the three major subsystems

Manufacturing, Sales and Studio. It is likely that this is another factor in the high levels of

integration observed across the business.

The final participant tally was therefore:

Manufacturing: 6 participants

Sales: 5 participants

Studio: 4 participants

Other: 2 participants (Both of whom had previously worked in one or more

of the main three areas.)

The interviewees length of service with the company ranged from eight years to twenty

five years, with an average of 15.7 years. The mean age of the participants was forty one

and there were sixteen men and one woman in the sample.


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3.2 Interview Procedure

The interviews took place throughout September 2007 and so many of the recent structural

and commercial challenges to the business were still in peoples minds. The conversations

took place in Bugmans the companys onsite restaurant and coffee bar. This was an

informal and familiar setting to all of the participants and so it was very easy to get them to

relax and talk openly.

Each interview followed the same plan. For each conversation I used a pre-prepared

question/statement booklet that enabled me to ask the same questions in the same order

(Appendix A). These questions were framed around four headings of Culture, Structure,

Strategy and Powerand in each section there were what I termed primary and secondary

questions.

For each of the headings, the primary questions all asked:

What is the current status?

How has that changed over time?

I was therefore able to ask What is Games Workshops structure? and How has that

structure changed over time?

or

What is the most powerful part of Games Workshop? and How has that centre of power

changed over time?


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For the purposes of my investigation, what I was most interested in was the first thought

answer to these questions and by embedding them into a series of supplementary or

secondary questions I believed that I was more likely to get an uncensored response.

3.3 Strengths and Limitations of the Method

Within cultural research, the ethnographic approach is well established as a means of

exploring the dynamics of organisations. Although there have been many recent attempts to

develop and apply quantitative measures to organisational culture in the form of cultural

audits and so forth, it is far from clear that these are indeed capturing culture, instead of the

more measurable notion of organisational climate (Denison 1996). Indeed, Siehl and Martin

(1990: 274) argue that this type of research runs the risk of reducing culture to just

another variable in existing models of organisational performance.

The ethnographic approach involves a range of elements and methodologies that are

blended together by the skills of the participant observer. In the context of this report I

make particular use of four elements:

The direct observation of the daily behaviour of the organisation

Conversations across a range of levels of formality. The structured interviews that form

the core of this research are a part of this range.

Long-term study of the organisation from my own eighteen-year history as a manger at

Games Workshop.

and hopefully a little of what Watson (2006: p11) calls critical common sense


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Therefore, although I am not a trained ethnographer, I believe that I do have the ability to

pass my observations through this common sense filter, in order to give the results of my

investigation some real and lasting validity.

3.4 Selecting the Sample

A critical challenge to the data collected from my interviews might be that the managers

who participated in these investigations were not randomly sampled from the organisation.

Instead, they were selected by me on the basis that I had known them personally for a

number of years and knew them to be outspoken and forthright in their views.

Although this approach does leave the investigation vulnerable to conscious or unconscious

bias in my choice of subjects, when identifying the potential participants in the research I

used three key criteria. First of all I was looking for individuals who held positions of

management responsibility or authority within the organisation and were able to represent

the voice of one or more of the major subsystems. Secondly it was important that they had

worked for the organisation since at least 1999 or 2000 so that they would have had

experience of at least one of the structural, cultural and power transitions that were the

subject of the study. Finally, they needed to view me as a colleague or a peer so that their

own comments and observations would be more open.

This was important, because as a member of the Games Workshop management team I

myself carried a degree of authority power. If I had made use of less senior members of

the management team, or individuals with whom I did not have an established or historical

relationship this authority effect might have had a distorting effect on the interviews and

the kind of responses they generated.


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The invitation to participate in the study (Appendix B) also made it clear that:

a) This was a management research project connected to my MBA degree course and not a

normal Games Workshop management investigation.

b) Although I would want to make use of individual responses and quotations in the final

report, no individuals would be named or given an identifiable job title.

As a result I feel that although not representative in a statistical sense, my respondents do

indeed represent a range of voices within the organisation and within the context of this

report provide valid and valuable insights into the organisational elements under study.

Having identified our research questions, reviewed the literature and settled on an

investigative method, its now time to look in more details at the characteristics of our case

study.


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4. The Case Study Games Workshop Plc

Games Workshop Group Plc is a UK company with its head office in Nottingham that

designs, manufactures and markets a hobby built upon the linked activities of collecting,

modelling, painting and fighting battles with model soldiers. The companys products are

metal and plastic fantasy miniatures and their associated games, rulebooks, magazines,

paints, brushes and modelling materials.

Customers use these materials to build armies of hand-painted fantasy miniatures which

they then use to fight battles over carefully modelled terrain. Participation in this activity

requires a great deal of skill and commitment on the part of these hobbyists. They are in

turn motivated and rewarded for their involvement through the received benefits of fun,

excitement, entertainment and increases in self esteem that flow from participation in this

set of closely related social and skill based activities.

The books, games and miniatures the company sells are all embedded within its fictional,

fantasy worlds of Warhammer and Warhammer 40,000. These fantasy and science fiction

backgrounds have been articulated and elaborated by artists, writers and illustrators

employed by the company to the point where they have an almost historical verisimilitude.

It is these fantasy worlds, replete with imagery, iconography, mythologies, histories and

heroes and villains that make the companys product offer so compelling for enthusiasts.

Games Workshop is a highly vertically integrated business. All of the companys products,

packaging and point of sale are designed and developed in its Nottingham Design Studio.

Manufacturing takes place at its Lenton headquarters or at sister sites in Memphis and


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Shanghai. The company sells its products through a chain of over 300 wholly-owned

hobby centres, that sell only Games Workshop products, and where customers can spend

time playing games and learning how to model and paint miniatures. It also distributes to

independent toy and hobby stores and sells direct to customers through mail order and the

world-wide web.

As a business with a dedicated and specialised customer base, Games Workshop perfectly

understands that operating in such a niche demands a highly specific set of resources and

capabilities. It knows that its products appeal to a relatively small number of people who

are devoted to the Games Workshop hobby. It also knows that, within its niche, quality is

more important than price and that respect for the customer is paramount. It knows that

mass-market advertising is expensive and, for niche businesses, ineffective compared to the

power of word of mouth.

The companys ownership of the value chain design, manufacture and retail - results in

highly cohesive patterns of interaction between individuals and teams within the business.

Apart from the purchasing departments, most Games Workshop staff spend the bulk of their

time either working with other employees, or directly with customers. These customers act

in turn as a ready recruitment pool for the business as their enthusiasm and specialist

knowledge of the companys games and miniatures perfectly fits them for further customer

facing roles.

We therefore have an organisation within which Peters and Watermans (1982) adage to

stay close to the customer is not so much a theoretical proposition but a literal

consequence of the organisations recruitment policies. By borrowing symbols, myths,


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metaphors and legends from its fantasy worlds, the company is also rapidly able to

assimilate new staff. These new members easily identify with, and are excited by, the

internal use of these artefacts and readily internalise the values and assumptions that they

represent and project them onto the company in an act of almost psychodynamic

transference. The result is a group of people who readily (albeit unconsciously) buy into

Scheins notion of culture as the correct ways to think, feel and perceive in relation to

problems of internal integration and external adaptation and who find in Games Workshop

a sense of purpose and meaning.

As Peters and Waterman (1982) put it: By offering meaning as well as money, they give

their employees a mission as well as a sense of feeling greatThe institution provides

guiding beliefs and creates a sense of excitement, a sense of being the best, a sense of

producing something of quality that is generally valued. (Peters and Waterman 1982,

p323)

Games Workshop is also a business in transition. Over the last thirty years it has grown

from an entrepreneurial start-up to a medium sized multi-national company with operations

in the UK, France, Spain, Germany, Italy, Northern Europe, USA, Canada, Australia and

Japan. However, although the company almost doubled sales in the five years between 1999

and 2004, from 78m (99/00) to 152m (03/04) with pre-tax profits rising from 6.5 to

20m, recent commercial performance has been poor. (Fig 5)


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Figure 5: Games Workshops five year performance 2003-07. Source: Games

Workshop Group PLC Annual Report 2007

*2003-2004 operating profit prepared under UK GAAP and 2005-2007 operating profit prepared under IFRS

Between 2004 and 2007, sales fell to 111m and in the summer of 2007, the company

reported its first ever loss and announced that it was embarking on a significant cost

reduction and rationalisation programme across the business.

4.1 The Red and Black Books

Despite the apparently committed nature of its employees and their willingness to share in

the values of the company, Games Workshop still has to struggle with what Strauss et.al.

(1963) describes as the negotiated order of the organisation. This idea describes the

dynamic interplay between the official and unofficial elements of an organisations

structure and culture. When the official and unofficial culture and structure are one and the


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same then it can be said that there is complete management control. When the two are

completely at odds with one another then there is little or no control at all.

As Watson (2006) has put it: It has been recognised that it would help managers

enormously in the struggle for control if they could get all of their employees to subscribe

to the beliefs inscribed in a corporate bible especially if they themselves could write this

bible. In the case of Games Workshop, the organisation does indeed have two bibles in

the form of CEO Tom Kirbys Black and Red Books. The first of these the Black Book,

was published in 1996. This was four years after Tom had led a management buy-out in

1992 and two years after the company had been floated on the LSE.

On the face of it, what Kirby was attempting to do was to draw a line under the

entrepreneurial phase of the companys development and prepare it for its next phase of

growth through delegation (Greiner 1972). In doing so, Kirby not only created a

management primer, but he also attempted to establish a set of principles and values that

should guide the behaviour and choices of individuals with managerial responsibility. The

Black Book was highly influential in a period of time when the company was still relatively

small and you could gather the twenty or so most influential people into a one room. As the

company grew in size and expanded overseas, he realised that he needed to update this

management text for a new age. The result was the Red Book, a volume that is far less of a

tome of management tips, tools and techniques, and far more of a book of culture. At the

core of both of these volumes is the notion that; How you behave does matter and that the

right ways to behave at Games Workshop could be encoded in a short set of classical

metaphors. In ancient Greece (and Rome) the muses came to stand for learned qualities


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things you could be taught. The graces were gifts from the gods personal qualities. My

lists are the muses and graces that Games Workshop needs (Kirby 1996).

What we have here is a highly explicit attempt at cultural shaping. If you now ask any

member of staff at Games Workshop What are the personal requirements of the

company? they would undoubtedly reply; the three graces - Courage, Honesty and

Humility. Depending upon their length of service and seniority they might also be able to

rattle off the six muses Consistency, Clarity, Firmness, Fairness, Openness and Integrity.

However, as we shall see from the research, the recent increased differentiation of Games

Workshop into the Studio, Sales and Manufacturing divisions has resulted in some

significant variations in the underlying core values and assumptions of these different parts

of the business.

I am not saying that Games Workshop is uniquely moral and is run by saints. I know that

it isnt true. But we must have high aspirations, both on behalf of the company and on

behalf of ourselves. If we fall short we must try harder. We should have the honesty to

accept we fell short, the humility to want to do better and the courage to try. How you

behave does matter.

(Kirby Red Book, 2003)

4.2 Symbols, Artefacts and Language

As weve already indicated, one of the unusual characteristics of Games Workshop is the

way in which it borrows symbols; imagery and iconography from its game worlds and uses

them as metaphors for the company. This extends far beyond the kind of brand imagery and

sloganeering used by many businesses and reaches far deeper into statements of value,


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purpose and meaning. The buildings at Games Workshops Nottingham HQ and indeed

many of its offices around the world are decorated with a large double headed eagle. This

same logo also repeatedly appears on company stationary, including the cover of the

employee handbook. This symbol is drawn from its Warhammer 40,000 game world and is

the badge of the Legions Astartes the Space Marines - one of the companys best selling

miniature ranges. Outside the building there is also a large mock-bronze statue of one of

these superhuman warriors.

Within the game world and their fantasy background, the motto of the Space Marines is:

And they shall know no fear! and this notion of No Fear! is taught to new recruits to

Games Workshop as one of the cultural values that has enabled the business to develop and

grow. The organisation communicates this idea of No Fear through a series of legends,

myths and sagas that describe how great challenges to the business were overcome in the

past through the fearless determination of individual staff who struggled against the odds to

deliver some new initiative or process.

This notion is invoked time and again in the internal discourses of Games Workshop to

describe for example; how the company came to develop plastic components, or run a chain

of stores that stock purely Games Workshop designed and manufactured products. What it

is saying, is that if you want to get on around here then you too must have No Fear!

Although what No Fear! means for any individual employee is not defined, the notion of

Courage as described in Tom Kirbys first Black management book probably comes

pretty close: We have to face the world and face it downWe are the only people who

can achieve that and the world is full of those who tell us it cant be done, that it isnt worth


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doing and that were going to fail. Spit right in their eye and walk past! What we do takes

courage, every working day of our lives. (Kirby 1996, Black Book)

A further example of the conscious use and interplay of language and symbols from the

Warhammer 40,000 game world is evident in the Emperor maxim that appears in both the

Red and Black books. The quotation goes: The Emperor will not judge you by your medals

or diplomas but by your scars. In the Black book, it appears as a final quote on the end

papers, but in the Red book it is included under a section entitled Planning, performance

and how you are judged.

Within the context of the Warhammer 40,000 universe this phrase is used to extol the

commitment and bravery of imaginary warriors going into battle against fearsome alien life

forms. It tells those about to die, that what they do is more important than who they are.

Used as an internal metaphor its tells both managers and employees at all levels of the

business that what counts over qualifications, seniority, or pay packet, is performance and

that it is on this alone that individuals will be appraised and rewarded (judged). Thus a

simple phrase, borrowed from one of the companys products, becomes a statement of

values that says; Games Workshop is a meritocracy and how your career develops is down

to you and the courage, initiative and determination you display in the performance of your

duties.

4.3 The Spirit of Games Workshop

In spring 2005, faced with continuing sluggish sales performance, the company felt that that

it needed to invigorate people across the business and reconnect them with the core values

of Games Workshop. The result was the creation of an induction course for all new and


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existing staff called The Spirit of Games Workshop (SOGW). The course consisted of a

series of five lectures and seminars delivered by senior members of the management team

under the headings: The History of Games Workshop, The Business of Games

Workshop, What is a Hobby, Outrageous Customer Service and People and Culture.

As a part of its roll out, this course was then filmed and edited into a multi-lingual DVD

that could also be used in Spain, France, Germany, Italy and Japan with the intention that it

became the standard induction course for all new staff wherever in the world they were

located.

Again, like Tom Kirbys management texts, both the courses and the DVD provide

examples of explicit attempts at cultural shaping by the management team. In the decade

since the buy-out, as the company has grown and internationalised, any number of

subcultures have begun to emerge. The purpose of the SOGW was therefore to once again

establish Scheins (1985) notion of culture as: a pattern of basic assumptions taught to

new members as the correct way to perceive, think and feel

As a cultural artefact, the DVD provides an incredibly rich source of analysis that is far

beyond the scope of this report to decode. Watson (2006, p.286) has provided a typology of

the various elements of organisational culture and all of these make their appearance at

various points in the filmed material.

Artefacts: can be seen in the logos, uniforms, signs, badges and images.

Jargon: constantly appears; as in the use of the term toy soldiers to describe the

companys games and miniatures.


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Discourses: can be observed is the way the presenters make use of concepts such as;

outrageous customer service, hobby and niche to frame and influence the way

employees understand and act in relation to the organisation.

Stories and Jokes: the presenters continually make use of perfectly constructed stories and

jokes as a means of cultural initiation.

Legends, Myths, Sagas: appear throughout the material and are used in an instructional

manner.

Heroes and Villainsall make their appearances and are expertly used by the presenters for

their instructional impact. In one section (SOGW/People and Culture - 0:03:40) the

presenter describes the behaviour of a number of Games Workshop villains a Head of

Retail and Trade Sales Manager - and ends each description with the phrase; and you

knowhe doesnt work for us anymore! Although like much of the material, this is

delivered in an almost jocular fashion, the message to the audience is clear. If you deviate

from the right way of thinking and behaving, then your employment with the company is

unlikely to continue!

After almost thirty years of development, Games Workshop has few competitors within its

niche and largely operates in a market entirely of its own making. In some ways its

analogous to a tribe or community that has been isolated from civilisation for a number of

years and has developed unique elements of culture in order to deal with the problems of

internal integration and external adaptation. Having successfully navigated its initial stages

of growth and development, the company now faces a challenge of age and maturity. Many


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of the individuals who founded the company are now in their late forties to mid fifties and

have realised that in order for the organisation to continue to thrive their knowledge needs

to be captured, transformed and externalised, so that along with the company culture, it can

to be handed over to the next generation of the business.

The major challenge for Games Workshop is that almost all of the knowledge upon which it

depends is tacit. At the core of its activities is the Games Workshop Design Studio. This

consists of 40-50 artists, sculptors and writers who design and develop the companys

games and miniatures. Many of the staff who work in this area have been continuously

employed by the company for between ten and twenty years. The craft nature of their

activities means that the only way in which their skills and knowledge can be transformed is

through socialisation and this is exclusively the case. The problem is that very little of the

knowledge that these individuals possess has ever been captured or documented. There has

been an assumption that they would always be working for the company and, given both the

nature of the business and the lack of competitors who might wish to aggressively recruit or

poach staff, this has largely held true. However as the organisation has developed over

time and navigated its various crises, these individuals have simply grown older and there is

rapidly approaching a time when retirement will simply strip the organisation of its key

skills.

At the other end of the spectrum, the company is highly dependent upon its chain of hobby

centres for recruiting and engaging with new hobbyists and selling products to customers.

Attempts to document and make explicit the knowledge, skills and behaviours associated

with the most successful of these have resulted in manuals and lists of commandments

that rather than stimulating knowledge have stifled it under a torrent of dos and donts.


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These have resulted in staff in some of the key customer facing areas feeling as if they no

longer have any freedom of action. The resultant paralysis and inertia has had a direct and

measurable effect on recent sales performance for the group.

Given that Games Workshop is a company that prides itself on its ability to truly innovate

both in terms of its products and customer service, what appears to have occurred here is

almost a textbook management of innovation mismatch. According to Burns and Stalker

(1961) operations that are working in a changeable and unpredictable environment require

organic or loosely bureaucratic management systems. When sales growth and

performance were incremental and predictable, through most on the 90s and into early

2004, the company began to develop increasingly bureaucratic management and control

systems. When the commercial environment the company faced began to become ever more

unpredictable and turbulent, then these same, rather mechanistic systems were simply

unable to adapt quickly enough to the much looser kind of controls that the management of

innovation requires.


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5. The Dynamics of Power at Games Workshop

According to CEO Tom Kirby, Games Workshop has been through many incarnations and

you will hear people say Warhammer is 25 years old or we have been doing this for over

20 years you know. Roughly true, but the group of companies you work in really started life

in December 1991. That was the date the founders sold it to a small management buy-out

team. That team is responsible for taking Games Workshop around the world and

transforming it into a public company with sales well over 100m and nearly three

thousand staff. That team is responsible for the culture and style of the business. A good

way of looking at this great group of businesses is not to see them as a head office with

branches or divisions, but as a big, loving family. Families have people of different ages

and differing personalities. Sometimes they squabble, but they all root for one another and

woe betide the outsider who tries to come between us. Like a family we make our own way

in the world. Interdependent but free.(Kirby: Red Book, 2003)

What is clear from this quote is that although Kirby clearly acknowledges the

differentiation of the business into separate divisions and functions over time; he also draws

on the belief that there is a stronger underlying culture - he likens to the blood ties of a

family acting as a powerful integrating force throughout the organisation.

With this in mind, I now want to make use of the Hickson et.al. (1971) dimensions of intra-

organisational power as a framing device; with which to analyse the historical development

of power within Games Workshop.


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5.1 1980s - The Dominance of the Design Studio

In the early years of the business, from roughly 1983 to 1992, the most powerful part of the

business was the Design Studio. This division carried responsibility not only for the design

and development of the physical products miniatures, games, books and magazines that

the company was selling, but also the logos, imagery, symbols, badges and iconography

that gave these products such verisimilitude and made them so powerfully evocative for the

companys fans and customers.

Applying the Hickson et.al. dimensions, we can say that at this point in time, the Design

Studio was the most powerful part of Games Workshop by virtue of the fact that:

a) Reducing future uncertainty

The product out put of the Studio was very successful in that everything it produced

sold in much larger than expected quantities and Games Workshop began to build its

reputation for high quality, innovative gaming products and miniatures. This continuing

sales success established a high level of confidence and trust in the business because of

the ability of the Studio to de-risk the future.

b) Centrality

At this point in the development of the business, it was hard at work establishing its

unique brand and presence in its marketplace. The idea of collecting, painting and

fighting fantasy wargames with model soldiers was still in its infancy and the product

turnover from design to market was extremely rapid. The Design Studio and its output

was central to the development and performance of the company.


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c) Non-substitutability

It contained a unique range of creative talents in the form of the sculptors, designers and

artists that were establishing the highly innovative product portfolio of the company in

the form of its twi

Documents

Culture Structure Strategy and Power MBA Management Project 2007 Robin Dews