Organizational Culture and Power Theory Oshry Essay (Article)

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Abstract

This paper review analyzes the case study ‘Renovating Home depot’ using two theoretical frameworks; Organizational Culture and Oshry Power Systems.

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Discussion

Home Depot inc. is a successful retail venture in US history was founded by Markus and Blank in 1979. The founders of Home Depot inc. had modeled a decentralized and entrepreneurial business approach to organization. In the year 2000 the company employed a new Chief Executive officer Robert L. Nardelli who in five years after arrival has been busy dismantling the previous management style.

The company was transformed from a decentralized system to a centralized rigid management style. Nardelli implemented military style of management. He shaped Home Depot inc. as a centralized organization where all major decisions and goals had to come from his office. To ensure that his management system of centralization succeeds, Nardelli recruited people and roped in ideas from the military as a key effort to centralize the organization.

According to this article the former administration at Home Depot allowed middle level managers autonomy which gave them freedom to spur innovation and authority to act incase of any changes in the local market. Managers heading aisles, departments and stores were given freedom and authority to be in charge (Noel et al., 2002). In contrast the new administration has taken the military as the new management style for the organization.

In the military all subordinates are expected to follow orders as communicated to them by superiors. In this regard, autonomy for managers was out of question in the new administration. They were all expected to implement what the Chief Executive had to offer without question. The new administration expected them to be disciplined, able to operate in high pressure atmosphere, and perform tasks with high standards.

The former administration at Home Depot inc. practiced the policy of internal recruitment and training of managers due for promotions. This policy was discarded by the new administration as it started a training program where junior military officers were recruited to train as future managers. According to statistics, the company hired 1,142 people into its leadership training program in year 2000. Out of this number, 528 almost half of the total hired were junior military officers. The new administration perpetuated this policy further by recruiting more members of the military in the company across the country. Accordingly, about 345,000 of the employees, that is, 13% of total Home Depot employees including the CEO himself, have had military experience.

Given that majority, that is, 87% of employees have had no military experience and only 13% of them had, I wonder how this military style of management can succeed in this organization. The majority of these workers do not have a clue on anything to do with the military policies and rules. According to this article, 11 former employees interviewed by Business week described staff at Home Depot as demoralized and this has resulted to customer service to wane.

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The article also quotes employees labeling the new Home Depot as ‘a culture of fear’ where they felt that they cannot be identified with a culture that treats them as soldiers and labels them as ‘Aprons’. In the old organizational system workers used to speak freely and truthfully to power. The new organizational system with such a chain of command style, employees definitely perform in fear of their bosses especially the 87% majority who are not familiar with this tough style of management.

Home Depot managers used to run the stores on what the article describes as ‘tribal knowledge’ based on years of experience and about what sold and what did not. With the new administration they nervously click their Blackberry’s at the end of every week, hoping they ‘made a plan’ to meet sales and profit targets. Before the company management hierarchy had Home Depot staff employed on full time basis but the new administration replaced them with part-timers which according to it were aimed at driving down costs. The company does not hesitate to fire any manager who does not meet its projected targets. This has led to the highest management turn over levels.

According to statistics, 98% of the company’s 170 top executives are new to their ranks since 2001.It further states that 56% of job changes at the headquarters involved hiring managers from outside the company. Under this environment managers performed in extreme fear.

The article describes Nardelli as somebody who is relentless and demanding. An administrator who starts his day of work very early in the morning and even considers weekends as normal working days and expects his juniors to do the same. Furthermore, he has a history of surrounding himself with recruits. When he was working with GE in the 1980s, he engineered a program of hiring junior military officers. He loads military literature to employees to motivate them to ‘out think their enemy’. The new management style ensured that all employees were constantly watched and kept track of. Their work was evaluated on productivity and was supposed to abide by his rules without fail.

In my own personal opinion, the new management style is not necessary and not suitable to a workplace such as Home Depot. Home Depot Company, I believe had distinct cultural values which I think the new management should have consolidated instead of overhaul. Specific management styles suit particular environment depending on core activities undertaken (Noel et al., 2004).

Power Theory Oshry

Oshry’s Power Theory comes from several simulations of organizational life. The theory propagates for ‘middle integration’. According to Oshry, middle level integration occurs when managers in various departments within an organization consciously meet to identify and address issues without the presence of subordinates and superiors. However, this system can only work if there is support from the superiors whom middle level managers report to.

The top management is expected to support the autonomy of the middle integration to meet, plan and act without always seeking permission from them. In this theory, the middle managers are also expected the right of top management to know about their activities by communicating constantly. This process encourages the empowerment of middle level managers who are constantly ignored while it bolsters long range strategic activities of top management.

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Oshry advocates for eight levels of middle integration as follows: First, no integration, the assumption being that there is no awareness of systematic forces that pull the middles apart. There is also an assumption that is no individual generated information. The second level is sharing information. It advocates for transfer of data concerning different parts of the system. The third level is working for the information. It involves finding out what the system needs. Fourth, coordinating responses to issues identified. Fifth, is problem solving where the identified needs are addressed through self initiated experiments. Sixth, outlines mutual coaching which helps each other with issues faced by individual members of the group. Seventh, it propagates for practices which promote organizational learning. Lastly, Power Bloc which aims at uniting the middle team to direct company direction and policy (Oshry B. 1999).

There are a number of instances where Oshry’s power theory is relevant in Home Depot inc. in this article. For instance, the former administrations style of management gave middle level managers autonomy and authority make decisions in the areas they managed. Under these conditions it was possible for middle level managers to integrate for the following reasons; first, it is possible for stores managers to meet and exchange notes on how they can improve their performances. According to Osprey’s theory, there is awareness of systematic forces that may pull middle managers together to self generate information for exchange.

Second, Oshry’s second outline of information sharing was possible in that the management style allowed managers to interact effectively. It was possible for Home Depot managers to meet and share information concerning their activities. Third, the system allowed middle level managers discretion to diagnose what the system needs. This is relevant to Oshry’s third outline. Fourth, the middle managers had authority and discretion to coordinate responses to issues they have identified. Fifth, managers had the authority to make decisions thus they are able address the identified needs through their own self initiated experiments. Sixth, the management system gave the middle managers opportunity to help each other with issues they faced as individual managers. Seventh, the managers were able to share the best practices to enhance organizational learning. Finally, in congruence with Oshry’s eighth outline, it was possible for middle level managers to unite and direct to provide organizational direction and policy (Oshry B. 1995).

In the new administration at Home Depot headed by Nardelli, Oshry’s power theory cannot work. Middle manager integration can only happen when managers within an organization are allowed to meet and address issues. Authority under the leadership of Nardelli was centralized period. All major decisions were made from his office and managers had to implement them. In a militaristic environment, everybody had to follow orders without question.

The organization has no option but to drop the autocratic management style. The majority of employees in this company has had no military experience and therefore should be allowed autonomy. Only then can Oshry’s power theory apply.

Reference

Noel L. Dotlich L. &Walker N. (2004).Leadership Passages: The Personal and Professional Transitions that Make or Break a Leader. New York.

Oshry B. (1995). Seeing systems: unlocking the mysteries of organizational life. Sanfrancisco: Berrett Koehler.

Oshry B. (1999). Leading system from power lab. San Francisco: Berrett Koehler.

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Tichy N. & Cardwell N. (2002). The Cycle of Leadership: How Great Leaders Teach Their Companies to Win. New York: Harper Business.

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IvyPanda. 2021. "Organizational Culture and Power Theory Oshry." September 24, 2021. https://ivypanda.com/essays/organizational-culture-and-power-theory-oshry/.

1. IvyPanda. "Organizational Culture and Power Theory Oshry." September 24, 2021. https://ivypanda.com/essays/organizational-culture-and-power-theory-oshry/.


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IvyPanda. "Organizational Culture and Power Theory Oshry." September 24, 2021. https://ivypanda.com/essays/organizational-culture-and-power-theory-oshry/.

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