Executive Summary
Organizational culture refers to “the specific collective values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization” (Schein, 2010, p.12). It describes the attitudes, expectations, values and beliefs associated with the members of an organization.
Organizational culture exists to help the organization to cope with its challenges. Thus a strong and cohesive organizational culture has a positive impact on the performance and efficiency of the firm. It particularly promotes high levels of productivity, high employee motivation and cohesion (Schein, 2010, p.17).
BSG ltd has a weak organizational culture as reflected in the problems facing it. Its problems include poor cohesion, high turnover, high pilferage levels, high employee dissatisfaction and mistrust between the workers and the management. In order to address these problems, the company should make changes in its rules, innovation, control, and coordination systems.
Implementing these changes will involve modifying the culture of the organization. Thus they should be implemented in a framework that enhances the commitment of the top-management, involvement of the employees and sensitivity to legal and ethical implications.
Introduction
Every organization has a particular culture that defines the relationships among its members and the manner in which the organizational procedures are curried out in order to achieve the end results. Culture refers to the knowledge, art, morals, capabilities and customs acquired by a person in a given society.
Thus organizational culture refers to the “set of particular organizational tasks that are carried out by the organization’s members in a specific way that makes it different from other organizations or units within an organization” (Kuofie, 2010, pp. 1-31). It describes the values and norms accepted by members of the organization and shape the interactions among members and between members and the general public.
A strong organizational culture promotes integration and coordination within the firm. Thus it has a direct influence on the efficiency and performance of the firm. This paper focuses on the benefits of a strong organizational culture. Recommendations on how BSG ltd can change its organizational culture in order to improve its performance will also be discussed.
Benefits of a Strong Cohesive Organizational Culture
A strong organizational culture has both direct and indirect benefits for the organization. This means that it has the potential of improving the performance and efficiency of the organization through the following was.
Achieving the Company’s Vision, Mission and Goals
A strong organizational culture helps in aligning the firm towards achieving its overall strategic goals as outline in its mission and vision. According to Hofstede et al (1990, p. 56) a strong organizational culture facilitates effective design of organizational processes in order to achieve the desired results.
It also encourages professionalism among employees. Professionalism helps employees to direct their efforts towards the achievement of the firm’s mission. According to Denism and Mishra’s model, organizational culture entails “involvement, consistency, adaptability and mission” (Parker, 2000, p.98).
Involvement promotes teamwork among the organization’s members. The mission provides the guidelines that help the employees to achieve the firm’s vision. Adaptability enables the members to remain resilient to external shocks and to take timely response measures to threats. These elements enable the management to align the organizational processes towards the achievement of its goals.
Motivation and Loyalty
A strong organizational culture facilitates high motivation and loyalty among the employees. Job satisfaction has a positive relationship with the extent to which workers fit into the culture of the organization.
Thus if the there is a match between the organizational culture and what the employees believe the culture should be; there will be positive consequences such as low turnover, low stress levels, high job satisfaction and low job strain (Linnenluecke and Griffiths, 2010, pp. 357-366). A people-oriented organizational culture creates a sense of belonging among employees, thereby promoting loyalty and high motivation.
Increased Team Cohesiveness
A strong organizational culture promotes openness and affiliation among the firm’s members. This promotes integration and coordination between the various units or divisions of the firm (Cirnu and Boncea, 2010, pp. 81-90). Effective coordination improves efficiency in decision making hence facilitating high performance. Effective coordination also helps the management to have proper control over the organizational processes.
Shaping Employees’ Behavior
Organizational culture is manifested in the way employees execute tasks, set objectives and allocate resources. Thus a strong organizational culture has a positive impact on the way employees arrive at decisions, feel about their jobs and how they are likely to respond to organizational threats (Cirnu and Boncea, 2010, pp. 81-90).
Similarly, it will have a positive impact on employees’ creativity, innovativeness and their ability to report unethical behaviors. A positive change in employees’ behavior is normally enhanced by a performance oriented culture. Such a culture promotes responsibility in regard to achievement of goals and objectives.
Competitive Edge
A positive change in the organizational culture is one of the main strategies of creating competitive advantages in organizations. A company whose organizational culture promotes creativity, innovation and professionalism will have a workforce with a high productivity level (Scott, Cook and Yanov, 1993, pp. 373-390).
Thus such a company will have a competitive advantage over its competitors in terms of better performing employees. Since a strong and cohesive organizational culture promotes cordial relationships between the employees and the general public, it enables the firm to create competitive advantages along the dimensions of customer services. This means that the organization will be able to offer excellent customer services which improve its competitiveness.
Changes to be implemented at BSG Ltd
The management problems at BSG can be summarized as follows. There is lack of cohesion among the workers. There is a low level of trust between the management and the workers. Job satisfaction levels are low, staff turnover is on the rise and cases of pilferage are also increasing. In order to solve these problems, the management should make the following changes.
Employee Support
Employee support refers to the help that workers get from the company. In every organization, employees normally have problems which can be work-related or personal (Kuofie, 2010, pp. 1-31). Personal problems relates to the employees welfare while the work related problems relate to the worker’s ability to perform his or duty.
At BSG, the 30% and 15% increase in pilferage and turnover levels respectively is a sign of low employee support. The employees are likely to steal from the company if they can not get financial support from the management. Similarly, they are likely to leave the company if they feel they can not get enough support for their personal and work-related problems.
According to constructive cluster theory, the organization should adopt cultural norms which enable employees to realize self-actualization and high self-esteem. Such cultural norms include “achievement, self-actualization, humanistic-encouraging and affiliation” (Schechter, 2005, pp. 47-63).
They enhance high productivity and job satisfaction. This can be achieved through support measures such as employee training, financial support such as retirement benefits and counseling. Such support measures will help in reducing the high turnover and pilferage levels.
Innovation
Innovation involves “introducing and implementing new ideas that benefit the organization and the employees” (Bushardt and Glascoff, 2010, pp. 11-21). BSG’s management should introduce new ideas that will enable it to effectively address the problems facing the organization and its employees.
Innovation can be achieved through sharing knowledge and information freely. The organization must come up with new ideas of combating pilferage, low cohesion, low job satisfaction and high turnover. For example, a better remuneration and result-based reward system can be introduced to motivate the employees. According to Charles Hardy’s theory, a task culture can help in achieving innovation (Parker, 2000, p. 78).
In organizations with a task culture, particular problems are solved by a team of talented employees. By working together, the team members will be able to share information, knowledge and introduce new ideas. The overall result will be an effective solution to the problem at hand.
Coordination
Coordination is a major problem at BSG due to low cohesion among workers, poor teamwork and mistrust between the workers and the management. The management should improve coordination in order to avoid conflict between various departments and to enhance success through combined efforts.
This can be achieved through proper planning, organization, control and teamwork. According to Charles Handy’s theory, organizations can improve coordination by avoiding a power culture which concentrates power in the hands of the management thereby alienating employees in the decision making process (Parker, 2000, p. 79).
According to Robert Cooke’s theory, coordination can be improved by developing a constructive culture (Cooke and Lafferty, 1987, p. 134). Such a culture enables employees to interact and cooperate with each other.
Rules
Rules are meant to ensure effective and efficient execution of procedures. Employees are bound to abide by the rules since such rules define the company’s procedures and standards. Rules also act as guidelines to employees’ behavior and they are normally associated with negative and positive sanctions (Hoffman, 2010, pp. 40-63).
Consequently, appropriate rules will help BSG to address problems such as pilferage and poor teamwork. The employees should be involved in the introduction and implementation of new rules in order to enhance acceptability.
Thus according to the defensive cluster theory, a passive culture should be avoided while introducing new rules (Hoffman, 2010, pp. 40-63). This is because in the case of a passive culture, workers obey rules just to please the management. Hence they will easily break those rules when they are not being observed.
Recommendations on how to Implement the Changes
Implanting the above changes involves a significant change in the organization’s culture. Since culture can not be changed rapidly, the changes should be implemented in stages over time. The following stages should thus be considered in implementing the changes.
Strategic Vision
The first step in implementing the changes involves formulating a clear strategic vision for the company. The vision typically represents a situation in which the current problems are fully addressed. Thus the above changes must be reflected in the company’s vision statement. The vision will specify the new strategy, accepted values and expected behavior changes. Hence it provides the “rationale and direction for the culture change” (Hoffman, 2010, pp. 40-63).
Top-Management’s Commitment
The top management must demonstrate their commitment to implement the changes. Culture change can be better achieved if it is managed from the top. The senior mangers’ willingness to change is a clear indication to the rest of the organization that change is needed (Parker, 2000, p. 103). Besides, the management will be willing to implement the changes in the entire organization if they favor it. Thus winning the support of the top management is a strategy for averting resistance to the changes at the management level.
Modeling Culture Change
The above changes should be notable at first at the highest level of the organization. For example, the managers must begin by improving the cohesion amongst them. The values and behaviors that are to be adopted by the entire company must be symbolized by the managers’ behaviors.
The strengths of the existing culture should also be emphasized (Parker, 2000, p. 117). This means that the above changes must not be introduced as radical changes but rather as an improvement of the existing culture. The rationale of this approach is that organizational change will be effective if it is evolutionary rather than revolutionary.
In order to effectively implement the changes, committees and task forces comprising employees should be formed to work together with value managers. Key change agents must be identified to communicate the new values and to mobilize the employees to accept the changes. The agents should be flexible, courageous and posses outstanding interpersonal skills (Bushardt and Glascoff, 2010, pp. 11-21). They must also have adequate knowledge about the company. The change agents should portray themselves as catalysts and not dictators.
Modifying the Organization
The current organizational structure and its systems have to be modified in order to align it with the new changes. This involves determining the existing systems, processes, policies and rules that should be changed (Scott, Cook and Yanov, 1993, pp. 373-390). For example, the accountability and compensation system can be changed to reduce pilferage.
The reward and benefits scheme can be improved to motivate the workers. New recruitment and retention programs can be introduced to reduce the high turnover.
Socializing the Employees
The change managers should be in a position to articulate the relationships between the intended changes and how they will affect and improve the firm’s success (Scott, Cook and Yanov, 1993, pp. 373-390). This will help in winning more support for the changes. All employees should undergo training in order to understand the changes.
Ethical and Legal Sensitivity
Since the above changes relate to employees’ integrity, job security, control and equal treatment, they are likely to cause tension and conflict of interest if not well implemented. Thus the implementation process must be informed by the ethical and legal standards in order to avoid resistance (Schein, 2010, p. 123).
The implementation process should be evaluated on a regular basis with the aim of identifying the areas that require further development. The evaluation will also help in determining the obstacles to the change process. The employees who are able to improve their behavior inline with the changes should be rewarded to encourage acceptance of the changes.
Conclusion
Organizational culture describes the various tasks executed by members of an organization and which make that organization different from the rest. A strong organizational culture has a positive impact on the company’s performance and efficiency (Schein, 2010, p. 123).
Thus it acts as a campus that guides the organization and holds its members together. The problems facing BSG ltd can be addressed by making changes in its rules, innovation, coordination, and employee support systems. Implementing these changes involves significant culture change in the organization. Consequently, the organization should formulate clear rules, provide support to its staff, and enhance innovation and proper coordination among the members.
References
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