The Importance of Organizational Culture in Strategic Management

 

Organizational culture is a relatively uniform perception held of the organization, which has common characteristics such as descriptive and it distinguish one organization from another, integrates individuals, groups and organization systems variables. Deal (2019) also defines organizational culture as values, beliefs, and behaviors that differentiate one organization from another (Hameed, 2021). The manifestations of culture as the way we do things around here, the rite and rituals of our company, the company climate, the reward system, our basic values. Behavior represents the explicit culture whereas the intrinsic culture is represented by the values and the basic assumptions. Culture is the shared philosophies, ideologies, values, assumptions, beliefs, expectations, attitudes. Organizational culture refers to symbols, values, ideologies and assumptions that operate in unconscious ways, to guide individuals and business behaviors and serve to create organizational cohesiveness (Waheed, 2021).

Organization culture directly influences the organizational member’s motivation, performance, satisfaction and stress levels. Culture, acting through institutionalized belief systems and group norms, can be a very effective means of directing the behavior of organizational members toward innovative activities, even though innovation is a highly uncertain process (Emilio, 2020). Organizational members are intentionally socialized into the assumptions and belief systems of the culture where group norms help to shape the behavior of the group members so that it is in accordance with the values and beliefs of the organization’s culture. The company’s corporate culture is mirrored in the character or personality of its work environment. This refers to those factors that underlie how the company conducts business and how behaviors are held in high esteem. This can be reflected in three levels discussed earlier (Deckop, 2018).

Organizational culture also known as "corporate culture" is a key aspect of organizations. The nature of organizational culture has a strong impact on performance and the quality of work experiences of its members. It has a major impact on the performance of organization, especially on the quality of work life experienced by the employees (Welch, 2021). Improve customer care, team spirit, being conservative and personality recognizable. Their culture has an impact on performance of the organization. Sometimes the organization has to adopt a strategy which suits their organizational culture so as to foster completion and meet changing needs of customers (Galanou, 2021).

Organization culture provides the members with a sense of organizational identity and generates a commitment. Though ideas that become part of culture can come from anywhere within the organization, an organization's culture generally beings with the leader who implements particular ideas and values as a vision, philosophy or business strategy. When these ideas and values lead to success, they become institutionalized and give shape to an organizational culture. Nowadays organizations operate in a dynamic market and environment and organizational culture should be altered to match strategies of an organization. An organizational culture always succeeds where the top management of an organization encourages new ideas (Galanou, 2021).

Organizational culture has a direct impact on other vital performance outcomes of any organization, including customer satisfaction and business growth and the strong effects of organizational culture are consistent across a wide spectrum of businesses and industries, from education institutions, churches, automotive sales and service and fast-food retailing to home construction and computer manufacturing. Organizational culture and its embedding contribute to better corporate performance (Welch, 2021).

Organizational culture affects employees and employees’ performance of the company. Employees are one of the most important determinants and leading factors that determine the success of an organization in a competitive environment. This is especially true for organizations that rely heavily on their good behavioral employees to provide friendly and courteous service to their customers in this competitive environment. Corporate culture is a significant determinant of organization behavior and performance, corporate culture and cultural strength are associated with superior performance (Deckop, 2018). More specifically, firms with strong-culture are more likely to retain the incumbent employees, have internally promoted managers, and reduce the probability of default and hostile takeovers than weak-culture firms (Hameed, 2021).

Organizational culture can influence organizational performance through employees and customers. They make organizational culture come to equally important status as institutional structure, tactics or control. Accordingly, enterprises must attach importance to the operation revision and innovation of organizational culture, so as to make organizational culture include the value orientation of enterprise staff and customer, and really meet their demands in the course of execution. Only in this way, can we unite enterprise, staff and customer, create ideal organizational performance and realize strategic objectives of organizations successfully (Emilio, 2020).

The organization culture brings all the employees on a common platform.  The employees must be treated equally and no one should feel neglected or left out at the workplace. It is essential for the employees to adjust well in the organization culture for them to deliver their level best. The work culture  unites  the  employees  who  are  otherwise  from  different  back grounds,  families  and  have  varied  attitudes  and  mentalities.  The culture gives the employees a sense of unity at the workplace (Hameed, 2021).

More over organizational culture enables employees to know their roles and duties very well. Every  employee  is  clear  with  his  roles  and  responsibilities  and  strives  hard  to accomplish  the  tasks  within  the  desired  time  frame  as  per  the  set  guidelines. Implementation of policies is never a problem in organizations where people follow a set culture.  The  new  employees  also  try  their  level  best  to  understand  the  work culture and make the organization a better place to work (Welch, 2021).

Organizational culture gives rise to a positive attitude and behavior which are again an addition to culture. Culture leads to good behavior and good behavior makes good culture which is useful for better behavior. Both employees and the organization enjoy culture. Organizational culture creates the boundary beyond which no employees are allowed to go. The attitude and behavior of the employees are directed towards the achievement of goals through a sound culture. Disciplined employees make other employees disciplined and well-behaved (Deckop, 2018).

 

Conclusion

To sum up corporate culture is important in strategic management because it shapes what the organization considers to be “right decisions”, what employees consider to be appropriate behaviors and how they interact with each other within the organization, how individuals work in groups and the organization as a whole deal with work assigned to them, the speed and efficiency with which things get done, the organization’s capacity for and receptiveness to change and the attitudes of outside stakeholders to the organization. Meanwhile there are limitations of organization culture such as misalignment, it is tough to change the organizational culture and employees may resist change. Meanwhile it is important for an organization to get the right culture through workshops, training, incorporating innovation as this enables organizations to foster competition, realize new opportunities and gain competitive advantages over rivals.

References

Deckop, 2018. The Effect Of Human Resource Management Practices on The Retention Of Former Welfare Clients. International Journal of Business Management, 5(3), pp. 65-79.

Emilio, 2020. The Impact of Training on Productivity: Evidence from a Large Panel of Firms. International Journal of Business Management, 5(3), pp. 12-35.

Galanou, 2021. A model for evaluating the effectiveness of middle managers training courses: evidence from a major banking organization in Greece. International Journal of Training and Development, 2(1), pp. 21-45.

Hameed, 2021. Employee Development and ItsAffect on Employee Performance A Conceptual Framework. International Journal of Business and Social Science, 4(1), pp. 14-28.

Waheed, 2021. Employee Retention Relationship to Training and Development: A Compensation Perspective. Journal Of Business Management, 5(2), pp. 27-35.

Welch, 2021. International Human Resource Management: Managing People in a Multinational Context. International Journal of Business Management, 4(3), pp. 74-85.