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The Cultures of Koch Industries and Southwest Airlines Case Study


Introduction

The organizational culture embraced in a business firm dictates its performance. However, a single approach to organizational culture might not deliver similar results in every organization. Southwest Airlines is a leading company that uses a people-oriented organizational culture. According to the company’s top managers, the ultimate goal of is to ensure the needs of the people are always put first. The workers are therefore empowered and encouraged to focus on their personal needs. A goal-oriented approach is used to deliver positive results (Klein, 2011). A team-based strategy is also used to ensure the needs of the external customer are addressed in a professional manner.

Internally, Southwest Airlines is associated with a powerful environment that empowers the targeted employees. The workers receive the best resources and tools in order to realize their goals. In order to deliver positive results, individuals are supported and empowered throughout the leadership process. The employees are encouraged to focus on their personal goals through continued innovation (Klein, 2011). The development of the workers plays a positive role towards promoting performance. Specific concepts such as teamwork, innovation, collaboration, and cooperation define Southwest Airlines’ culture. Rituals, gifts, and celebrations are used to empower the employees.

On the other hand, Koch Industries embraces a different approach to organizational culture. This company uses a market-based management (MBM) organizational culture (Koch Industries, 2016). This MBM approach is embraced in order to help different stakeholders realize their potentials. The ultimate goal of this organizational philosophy at Koch Industries is to guide and govern the activities of the employees. The firm uses the cultural approach to transform its workers. This practice is promoted because of its ability to produce greater value for different customers. There are specific values that characterize the firm’s organizational culture. These values include compliance, customer focus, respect, humility, integrity, change, value creation, and principled entrepreneurship (Koch Industries, 2016).

This analysis shows clearly that Koch Industries uses a different organizational culture from that of Southwest Airlines. This is the case because the workers are required to focus on the best outcomes. The company implements specific models that can improve performance and result in revenue growth. On the other hand, Southwest Airlines empowers its workers to work as teams, pursue their goals, and eventually focus on the experiences of the targeted customers (Piccolo & Bardes, 2011). However, both companies promote similar concepts such as innovativeness and aggressiveness in order to deliver positive results.

Merging the Companies

Possible Challenges

The decision to merge Koch Industries and Southwest Airlines is plausible. The proposed idea has the potential to maximize the business processes of the companies and eventually result in increased profits. However, the corporations are characterized by diverse organizational cultures. The acquisition of Southwest Airlines by Koch Industries will definitely result in new shifts in leadership practices. This development will have negative impacts on the effectiveness and performance of the employees.

At Southwest Airlines, decisions are usually made in a collaborative manner while Koch Industries relies on the ideas presented by the MBM leaders. That being the case, the decision-making process at the new firm will definitely be affected. Issues of trust might also emerge after the merger. Some of the workers at Southwest Airlines might not trust their counterparts from Koch Industries (Piccolo & Bardes, 2011). Consequently, the employees will find it impossible to work as teams.

The workers at Koch Industries embrace the concept of goal-oriented practice. According to them, profitability and positive goals are critical towards making the firm successful. The opposite is true at southwest airlines. This is the case because the company uses a team-based strategy to produce positive results. Southwest Airlines creates the best working environment whereby socialization and humor are encouraged (Whatley, 2013). This kind of practice in not encouraged at Koch Industries. These issues will definitely result in role conflicts at the new company.

The employees from the two firms might find it impossible to collaborate with one another. The processes of problem-solving, decision-making, and communication might be strained (Piccolo & Bardes, 2011). The workers will definitely become reluctant and fail to focus on the targeted business goals. The occurrence of such challenges can make it impossible for the merger to achieve its business objectives.

Strategies to Prevent Culture Clashes

When two companies merge, the chief executive officers (CEOs) mainly focus on their financial outcomes. This means that the decision to merge the cultural aspects of the companies is usually ignored. It would therefore be necessary to use powerful strategies to prevent culture clashes throughout the merger process (Whatley, 2013). The first strategy towards achieving this goal is ensuring that the values and visions of the corporations are merged. This move will ensure the firms create new values that can support every worker.

The next step is communicating these values to the workers. New behaviors, attitudes, and attitudes should be embraced in order to support the working environment. The employees can be included during the process. This strategy will make it easier for them to form new teams depending on their skill sets (Bird, 2011). The leaders in the companies should guide their respective workers to embrace the proposed values.

The new company should set measurable and attainable goals for the workers. The workers should be equipped with adequate skills and resources in order to focus on the targeted goals. The process will ensure the new workforce is aware of the targeted goals. The other important thing is to monitor the level of job satisfaction (Piccolo & Bardes, 2011). This strategy is critical because the workers have specific needs that must be addressed. The leaders will therefore offer the most desirable guidelines and skills in order to empower the workers.

The common aspects such as innovativeness should be taken seriously throughout the acquisition process. These aspects will bring the workers together and minimize the possibility of conflicts. The HR department should use a powerful code of conduct to guide the employees (Whatley, 2013). The code will ensure the workers collaborate with one another, focus on the best strategies, and support the needs of the targeted customers.

Concluding Remarks

Organizational culture defines the beliefs, practices, values, and strategies supported by a company. When two or more firms merge, it is impossible for the workers to continue using their original cultures (Piccolo & Bardes, 2011). This is the same issue that will face a merger between Koch Industries and Southwest Airlines. It is agreeable that the merger has increased chances of facing different challenges. That being the case, the leaders must use a powerful strategy to merge the cultural values and visions of their respective firms (Klein, 2011). This strategy will result in new values and workplace behaviors that can prevent culture clashes.

References

Bird, A. (2011). Southwest: Corporate culture combines work, play. The Post and Courier. Web.

Klein, D. (2011). Creating culture that lead to success: Lincoln Electric, Southwest Airlines, and SAS Institute. Organizational Dynamics, 41(1), 35-39.

Koch Industries. (2016). Web.

Piccolo, R., & Bardes, M. (2011). The art of capital restructuring: Creating shareholder value through mergers and acquisitions. New York, NY: Wiley.

Whatley, H. (2013). Principles and dimensions of market-based management. Independent Journal of Management & Production, 4(1), 126-135.

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IvyPanda. (2020, October 19). The Cultures of Koch Industries and Southwest Airlines. Retrieved from https://ivypanda.com/essays/the-cultures-of-koch-industries-and-southwest-airlines/

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1. IvyPanda. "The Cultures of Koch Industries and Southwest Airlines." October 19, 2020. https://ivypanda.com/essays/the-cultures-of-koch-industries-and-southwest-airlines/.


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IvyPanda. "The Cultures of Koch Industries and Southwest Airlines." October 19, 2020. https://ivypanda.com/essays/the-cultures-of-koch-industries-and-southwest-airlines/.

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IvyPanda. 2020. "The Cultures of Koch Industries and Southwest Airlines." October 19, 2020. https://ivypanda.com/essays/the-cultures-of-koch-industries-and-southwest-airlines/.

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IvyPanda. (2020) 'The Cultures of Koch Industries and Southwest Airlines'. 19 October.

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