ORG Week 5.2

Initiating Change

-create a sense of urgency -role modeling -changing leaders

Advantages of Employee Diversity

-diversity enhances creativity -diversity enhances image -diversity improves outreach -diversity improves morale

Managing Change

-excellent communication -changing leaders who present barriers to change -training programs -changing rewards systems and corporate symbols -changing the look and feel of the workplace

Visible Signs of Culture

-how employees dress -snack areas and candy jars -plaques and awards -mission statement -events and rituals -physical layout and decor

Methods for Maintaining Corporate Culture

-recruiting -hiring -onboarding -training

Organizational Culture Profile (OCP).

The OCP is an instrument initially developed by consultants Charles A. O'Reilly III, Jennifer Chatman, and David F. Caldwell to assess person-organization fit. In theory, employees should have the same basic cultural assumptions and values as the company for which they work.

General Motors had long-running problems with Chevy Cobalt ignition switches. The switches could disable the emergency airbags, causing accidental deaths. The GM culture discouraged anyone from stepping up and addressing the problem. Mary Barra, the new CEO, made a public commitment to change. After an investigation, two senior managers left the company in 2014. By ________, GM was better able to move forward.

changing leaders

At The Ritz-Carlton, the Credo and The Employee Promise are displayed in common areas and in each office. In addition, all employees—known as "our ladies and gentlemen"—have a pyramid on their desk that shows the annual goals, vision, mission, and motto. The pyramids are

artifacts

Organizational culture

is a term that can relate to any organization at all, from a church to a university. When talking about the culture of a business, you'll often hear the term "corporate culture."

Between 2014 and 2017, General Motors paid more than $2 billion in fines, penalties, and settlements due to faulty ignition switches, a flaw that led to vast recalls and at least 124 deaths. The fault was identified in 2002, but it took GM engineers and managers a decade to fix it. An independent consultant hired to investigate attributed this to a culture that rewarded conformity and silenced bad news. Senior executives were forced to investigate and fire employees after widespread media reports. These executives

lacked an adequate sense of urgency

It took Boeing 6 years to produce the first 787 aircraft, and it will take another 6 years to break even from the $32 billion investment. Design engineers may move on even before the plane leaves the ground. The company needs people and a culture that works for a future longer than the average career today. The culture is shaped by

the industry

According to Robert Half Management Resources, most change efforts fail because of

inadequate communication

A ________ workforce may offer more creative approaches or solutions to problems.

diverse

Former Senate Majority Leader George Mitchell responded to a white supremacist rally in Charlottesville, Virginia, with this argument: "Amazon was created by Jeff Bezos, whose adoptive father was born in Cuba. Google was co-founded by Sergey Brin, who was born in Russia. Would we be a better country if they had not been admitted? Of equal importance, what are the chances that if Steve Jobs had lived his life in Syria he would have created Apple? Or Jeff Bezos in Cuba? Or Sergey Brin in Russia?" He argued that

diversity is America's strength

values

drawn from those assumptions. These usually appear in the form of standards, rules, and public expressions of the organization's philosophy.

Studies show financial advantages to diversity in senior management. But the promotion process tends to suppress expressed differences. To be seriously considered for promotion to a top-level management position in many U.S. companies, individuals must assimilate to the company's culture. Companies can manage this through

employee training and diversity-oriented company policies

Studies show financial advantages to diversity in senior management. But the promotion process tends to suppress expressed differences. To be seriously considered for promotion to a top-level management position in many U.S. companies, individuals must assimilate to the company's culture. Companies can manage this through

employee training and diversity-oriented policies

Bob Cratchett is an accountant with Marly and Co., a prosperous lender in London. Marly and Co. has survived some severe downturns in the market and has been a stable employer. Bob wears heavy wool suits at work in the winter and works at a standing desk. The ________ is a clue to the culture at Marly and Co.

employee's dress

Half of the total revenue generated by S&P 100 firms is from outside the US. Qualcomm, a telecommunications equipment company, gets about 87 percent of its revenue internationally and has enjoyed average revenue growth of over 25 percent for the past 10 years. In order to serve its customers, Qualcomm should focus on hiring

employees with a wide range of backgrounds

Sources of Culture in and Organization

founders and industry

assumptions

Core. about human behavior, which are usually so ingrained into the culture that they're difficult to pinpoint.

Mergers can be difficult because of cultural differences between firms. In 2008, Bank of America bought Merrill Lynch, a stockbroker. Their cultures and pay packages were starkly different. After the merger, in 2009, leading brokers of Merrill began departing for friendlier waters. Some went to Morgan Stanley, and some became independent brokers. The rating agency, Standard & Poor's, called the departures a "cause for concern," adding that "if brokerage attrition picks up, the acquisition becomes less valuable." Divided cultures in one firm can be

a competitive disadvantage

In 2013, Microsoft was losing ground to Google and Amazon. CEO Steve Ballmer announced changes aimed at the culture. His letter asked for "more emphasis on teamwork and collaboration, more emphasis on employee growth and development" and announced "no more curve [or ratings.] ... Managers and leaders will have flexibility to allocate [compensation] in the manner that best reflects the performance of their teams and individuals, as long as they stay within their compensation budget." Ballmer used ________ to foster culture change.

a reward system

Johnson & Johnson is an American multinational manufacturer of medical devices, pharmaceuticals, and consumer packaged goods. Its credo, on a stone at the entrance to headquarters, says that stockholders come fourth, after customers, employees, and communities. The credo is

a statement of values

Americans generally expect meetings to start on time, and some will show up early so they don't delay the start of the meeting. Employees from Latin American or Caribbean countries may not take appointment times as strictly. You may be annoyed when they delay the start of a meeting by 15 minutes, but it could be business as usual for them. A diverse workforce requires

active management and employee training

Corporate culture is rooted in

an organizations goals, strategies, structure

Home Depot's return to a customer service culture included recognitions, bonuses, and buttons for employees' orange aprons. HD advanced a culture change by

changing rewards systems and corporate symbols

To deliberately initiate culture change at company is an uphill struggle. Most employees tend to return to familiar ways of doing business. To succeed, executives need to

create a sense of urgency, model the changes they wish to see, and show commitment to the new culture

A firm's statement of values requires a lot of pruning. There are many acceptable values, but to be effective, the list must be short. Executives choose the most important values. Therefore, the clue to ________ is in what is chosen.

culture

The banking industry is heavily regulated to prevent crises like the Great Recession of 2008. At the same time, it can be very competitive, with bankers each trying to win deals. A company in this industry may have two cultures, one to enforce regulations and another to make the sales or investment decisions. The employees working on regulations need to be

detail-oriented

In the Organizational Culture Profile (OCP), companies can be scored on seven dimensions that reflect their culture. These include

detail-oriented, aggressive, people-oriented

According to the OCP, every corporation can be described as one of the following:

detail-oriented, innovative, aggressive, outcome-oriented, stable, people-oriented, or team oriented

Goldman Sachs is a white-shoe investment bank. The firm does well by maintaining close connections throughout the business, investment, and political worlds and staying well-informed. Hank Paulsen, a former CEO, became the U.S. Secretary of the Treasury and managed the Treasury during the Great Recession of 2008-2009. To maintain its connections, Goldman hires people

of varied backgrounds

JAMF is a software company offering enterprise management systems, which help manage the security and software updates to all of a company's computers. A new employee at JAMF spends the first 3 weeks in training, called Zero Month. The training covers the company history, relationships with customers and other employees, and the products. People walk out of JAMF's Zero Month saying, "I can't believe I'm part of an organization in which culture is that important." As a result of the training, JAMF has a 90%+ retention rate of employees and a 95%+ retention rate of customers. This training is an example of

on boarding

artifacts

outer layer. the outcome of the assumptions and values—these appear as actions, policies, the physical environment, office jokes, and so on.

Warby Parker has been making and selling prescription glasses online since 2010. It designs its own glasses and sells directly to customers, cutting out the middleman and keeping prices low. It works to ensure the entire team works well together by insisting everyone helps keep break areas clean or sending random employees out to lunch together. Warby Parker culture is

people-oriented

Diversity as a strategy hopes to gain, for example, from more problem-solving approaches or more connections. In this context, diversity includes

personality, cognitive style, education, and social background

GE's SVP of Global Operations, Shane Fitzsimons, wrote a 2016 article for Fast Company magazine, stating what kind of person GE wants to hire. For example, he writes, "the kind of person who succeeds at GE is humble." The article shows GE's approach to ________ candidates.

recruiting

Companies make choices in their HR processes that can help maintain the culture. The processes include

recruiting, hiring, and training

USAA, an insurance company for military families, asks employees to identify with their customers. According to BusinessWeek, their initial training involves reviewing deployment letters like the ones soldiers get telling them to get their affairs in order before reporting for duty on a specific day and time, eating MREs (meals ready to eat) like the ones soldiers eat, and reading real letters from soldiers in the field to their families back home. At USAA,

the corporate culture reinforces the brand

Amazon competes with low prices, selection, quick deliveries, and easy returns. Employees know they succeed through efficiency improvements in any part of the process. Customers rely on Amazon for prices, selection, and easy service. What does this illustrate about the relationship between Amazon's culture and brand?

the culture and the brand reinforce each other

In 2000, AOL and Time Warner merged. The deal was valued at $350 billion. Ten years later, Time Warner sold AOL for about $3 billion. Mr. Parson, the president of Time Warner before the merger, said afterward that "The business model sort of collapsed under us, and then finally this cultural matter. . . . It was beyond certainly my abilities to figure out how to blend the old media and the new media culture. They were like different species, and in fact, they were species that were inherently at war." "Culture" here means:

the shared values, attitudes, and beliefs that determine a business' corporate behavior

Corporate Culture

the shared values, attitudes, standards, and beliefs that characterize members of an organization and define its nature. Corporate culture is rooted in an organization's goals, strategies, structure, and approaches to labor, customers, investors, and the greater community. As such, it is an essential component in any business's ultimate success or failure.[1]

Netflix's pioneering approach to culture, like not needing permission to take time off or its policy of no annual employee reviews, is meant to attract "fully formed adults" who are okay with the business being run like a pro-sports team rather than a family. To make sure candidates get the message, Netflix includes a long manifesto, "Culture at Netflix," on their website. This statement represents

the values level of culture

Google researches the effectiveness of its teams. Scott Page, a professor of complex systems, political science, and economics at the University of Michigan, showed Google that "homogeneous teams . . . are the land of B+. . . . The key to successfully building a team is to make sure that it is equipped with a wide range of tools to tackle tough problems. . . . If you want an A, you've got to have a diverse team." How does Google primarily benefit from diverse teams like the ones Page describes?

with diverse backgrounds and experiences, Google engineers can come up with more creative ideas and solutions