Introduction
Corporate culture refers to a system of ideas, norms, and values that determine how people live, think and act within any given company. This paper shall dwell on Sara Lee’s corporate culture especially given the fact that the company is currently implementing a restructuring program. Relevance of corporate culture in this scenario will be carried out and recommendations given on appropriate actions that can be carried out by its leaders.
Characteristics of the company’s culture and how it affects company performance
There are several ways in which one can interpret Sara Lee’s corporate culture. One way of interpreting this is by looking at its various subcultures. Since Sara Lee operates within several countries/continents, there are different geographical cultures that affect its performance. Also, because there are several business units that make up this global entity, then one can assert that divisional subcultures also contribute to its corporate cultural outlook. For instance, Kraft and Jimmy Dean sausages have different cultures compared to their Superior Coffee divisions. Corporate subcultures are also influential within this company’s operations owing to the fact that some of its employees may not appreciate conventional human resource promotional strategies as is the case with other companies.
The existence of numerous subcultures at Sara Lee is affecting its performance negatively; this is large because some of the subcultures tend to clash with the company’s overall business strategy. (But, 1999) In other words, some geographical areas are not as competitive or do not share Sara Lee’s business ideas. In such circumstances, this firm is put in a position where it has to deal with various obstacles from time to time, and implementation of its retrenchment and narrowing strategy can therefore be very tricky to carry out.
On the other hand, upon analyzing Sara Lee’s corporate strategy, it is possible to see an outstanding culture throughout all its divisions and that is the possession of an adaptive culture. In other words, individuals within this organization tend to embrace opportunities as they come in the hope of achieving long-term success. However, it should not be assumed that the company is operating in a haphazard manner.
On the contrary, members of Sara Lee are driven by core values and ideals. This is the reason why Sara Lee was able to implement a very aggressive strategy incorporate retrenchment. An adaptive culture is also seen upon examination of this company’s history. In 2004, it acquired an intimate apparel company; in 2001 it bought Earthgrains and has carried out many more acquisitions and sales.
This kind of culture has affected Sara Lee Corporation positively. In other words, the company has managed to respond to its external environment well and on time thanks to its leadership’s changes. Aside from that, the company also looks into the needs and concerns of different stakeholders such as their employees, suppliers, stockholders, and many others. Because of the latter method, staff members tend to support this change as stated by Sara Lee’s financial advisor concerning changes proposed by Brenda Barnes (its CEO). Lastly, the company’s commitment to enterprising ideas encourages further growth. This is the reason why innovative new products are one of the greatest sources of competitive advantage within the firm. (Sathe, 2003)
Actions that management should take to strengthen the company’s corporate culture given the current strategic decisions
It should be noted that Sara Lee is already on the right path in terms of its corporate culture. Researches concerning effective cultures have revealed that an adaptive one is the best bet in today’s corporate arena. However, Sara Lee still needs to improve it given the fact that it is undergoing an aggressive retrenchment strategy. First of all, it should challenge assumptions existent in its respective industries.
For instance, some products can change and become commodities. Sara Lee needs to examine these possibilities and reflect them in its corporate culture. Aside from being more flexible, Sara Lee needs to align its culture together with performance and strategy. This will assist the company in guiding employees on how to carry out their tasks and will also motivate its members to become more supportive of the retrenchment strategy. Lastly, the company can work on its destructive subcultures by first diagnosing them and then aligning them towards their overall goals. (Schneider, 2006)
3 leadership actions that should be considered while implementing the retrenchment strategy
One feasible action is the identification of change elements in the company’s operations. For instance, Sara Lee should replace its old-line managers with dynamic managers so that they can facilitate their retrenchment strategic decision. Secondly, this company’s leadership should instate a spirit of high performance by educating their staff on the values of this principle. Lastly, their leadership should focus on rewarding those business units and individuals who are innovative and competitive.
Conclusion
Sara lee’s retrenchment decisions have already begun showing some positive outcomes thus indicating that its corporate culture is not far from the mark. However, to achieve the full rewards of their strategic initiatives, it would be more effective for the company to consider rewarding innovative efforts, eliminating destructive subcultures, and instating a focus on high performance.
References
But, R. (1999). “Corporate culture as a competitive asset.” The financial Times, 15.
Schneider, S. (2006). Managing across cultures. NY: Prentice Publishers.
Sathe, V. (2003). Corporate realities and culture. Homewood: Irwin Publishers.