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Contemporary Management Theory
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Write an essay on ONE of the following topics: 1. How does organisational culture impact on an organisation’s performance?
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Organisational culture and the impact on an organisation’s performanceThe term organisational culture is defined as “the formal system of task
and authority relationships that control how people coordinate their
actions and use resources to achieve organisation goals” (Aquinas, 2008).
Organisational culture is always something that is taken for granted and
the actions which allow to make shared values of people’s organisational
perspective as this lets employees perform and react relating to concern,
they might encounter within a workplace environment.
This shows the important influence that organisational culture has on the
development of organisational strategy used in business environment. A
strong and robust organisational culture is an important and essential
strategic asset which is the core of every business strategy,
implementation and innovation. Berry (1983) in the 1980s illustrated that
employing an organisational culture, companies will create a more
successful and efficient way of carrying out their goals and objectives. An
effective leader would demonstrate an understanding and help to shape
the culture of an organisation to order to allow for that vision to be
pursued and intended strategic implementation.
There are several important qualities and characteristics of organisational
culture. First of all, organisational culture is shaped by the people within it
through personalities and experience of the employees that creates the
culture within the organisation. This is shown by employees who might be
sociable and outgoing, resulting in the culture to be sociable and open.
Other qualities which are an important attribute is that the culture is
negotiation as this means that one person cannot create culture alone but
as a collective as this is shown by person culture. Employees must then
change and alter the business environment; direction and the way
business are conducted and the way in which main judgments are made
within the overall business environment.
Reinforcing strategic leadership and system development must be
maintained by the structures responsible for each. It would be difficult to
change other features of an organisational culture. The Hierarchy culture
will require employees to adjust and shift their behaviours and
managements. This is often something that is problematic and
challenging for employees to unlearn their outdated method of achieving
ideas and start performing different characteristics and behaviours
constantly. Discipline and employee’s involvement training will help to
allow to assist in change of the organisational culture (Heathfield 2012).
This can be illustrated by Jack Welch CEO of General Electronic that has
formed an approach which is called ‘Destroyyourbusiness.com’
(Bloomberg 1999). This aims for allowing organisation to adopt commerce
as innovative approach of undertaking business which has led to
considerable influence on the necessary culture of the company. A single
culture that may exist is the last characteristic of organisational culture
, and many academics believe that there always should be a specific
organisation culture than a single culture.
This is something that is accurate for geographically focused
organisations, however for many companies with an extensive collection
of products and with a geographical position, an individual subdivision is
essential. For example, Chinas operation being a global manufacturer that
seeks cost-efficient production would have a different culture from its
main sales company within the Europe, where the company will try to
introduce as a premium company image. This is important for any
company to have a good and appropriate culture in each division and to
be capable to bring together the cultures to benefit for the organisation as
a whole.
Organisational managers always use organisational culture when
confronted with several problems on how to articulate achievements
within an organisation. Organisational culture is developed as one of the
most essential and important factors that leaders would apply in order to
continue successes within the organisational (Mark, 2005). Leaders and
managers who understand organisational culture and give appropriate
attention to it will be in a situation to forecast and take judgments to
resolve these changes before any consequence occur (O’Donnell & Boyle,
2008).
Strong-culture thesis is one of most common theories that understood the
responsibility of managers and employees to have the same belief, value
and standards will give helpful outcomes that evidently associated with
the amount of financial gains in a company (Denison 1984). Additionally,
the positive influences of being motivated in shared organisational culture
promotes employees to connect with the company values and feels
responsibility and attachment for it. Yet, several academics indicate that
reserve connection among performance and culture the high performance
indicates a formation of a strong culture which is possible to succeed to
bring a familiar set of values and beliefs.
It is also disputed that organisational culture possesses significant
influence on organisations continuing profitability. The organisational
culture can also change the financial performance through which the
cultures, helps to create a strong performance result which helps the
performance of the financial outcomes that business desires. The culture
of the organisation does form the foundation on which allow many
employees to carry out their job role within an organisation (Kotter, 1992).
For example, Luxottica, an Italian eyecare company wanted to improve its
employee commitment and engagement to improve the performance of
the company. This organisation concluded that members within its New
Zealand and Australian operation that total around about 6500 employees
where disengaged and this led to 56% of them not knowing or
understanding the business goals and strategies. Nevertheless, after the
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