6 - Strategy and organisational culture

Question 1

Chapter 6 learning outcomes

Answer 1

• demonstrate a thorough understanding of the meaning and importance of culture within an organisation
• understand the different types of culture models argued by Handy, Schein, Johnson and others
• consider why there is a need for a breadth of cultural awareness in our local, national, multinational and multicultural business environment

Question 2

CoSec and an org’s culture

Answer 2

CoSec will be part of the culture by virtue of being an employee

but their role will often require them to step back mentally or physically, to objectively consider how and why other people behave in certain ways

Question 3

Barney definition of organisational culture

Answer 3

A complex set of values, beliefs, assumptions and symbols that define the way in which a firm conducts its business

Question 4

Simple, frequently occurring definition of culture (use in exam with Barney def)

Answer 4

The way we do things around here

Question 5

Schein’s three distinct levels of organisational culture

Answer 5

Underlying assumptions - unconsciously guiding behaviour

Values - promoted within org to epitomise what org stands for and to guide individuals

Artefacts - visible and tangible evidence of org culture

Question 6

Schein’s organisational culture model explained

Answer 6

Pyramid with:
Underlying assumptions at bottom
Values in middle
Artefacts at top

Question 7

Schein - organisational culture - underlying assumptions

Answer 7

Held unconsciously by people working within the organisation, implicitly guiding behaviour and opinions of employees

Question 8

Schein - organisational culture - values

Answer 8

Often promoted within an org to epitomise what it stands for
In reality, often a gap between the values stated as held by the org and those held by the employees
Values can guide an individual on how to deal with a situation that is not resolved automatically by underlying assumptions

Question 9

Schein - organisational culture - artefacts

Answer 9

Visible and tangible evidence of organisational culture
Structure and layout of workspace, etc.

Question 10

What is strategic drift?

Answer 10

The time gap between the development of the strategy and the changes within the environment

Question 11

4 phases within strategic drift process

Answer 11

Incremental strategic change
Strategic drift
Flux
Transformation or death

Question 12

Incremental strategic change (phase of strategic drift process)

Answer 12

Small changes that occur during long periods of relative stability - orgs adapt gradually without need for more radical change

Question 13

Strategic drift (phase of strategic drift process)

Answer 13

Occurs where micro or macro changes restrict org’s ability to amend strategy - causes gap between strategy and environment to widen

Question 14

Flux (phase of strategic drift process)

Answer 14

Caused by gaps developing during strategic drift stage - causes disagreements and complexity within org over how to respond

Question 15

Transformation or death (phase of strategic drift process)

Answer 15

Result that naturally emanates from stage of flux - agreed resolution to realign strategy with environment, or strategy (and potentially company) ceases to exist

Question 16

Bias in strategy

Answer 16

Natural/cognitive bias can have great impact on strategy - we should try and be as objective as possible when developing strategy so it is important to be on the lookout for bias and be aware of types of bias

Question 17

3 examples of cognitive bias

Answer 17

Confirmation bias - selecting what agrees with existing beliefs
Recency bias - not looking far enough back
Groupthink bias - fitting in with the crowd

Question 18

Johnson’s 3 main cultural frames that need to be taken into consideration to understand individual’s behaviour

Answer 18

Geographic - national/regional influences

Organisational field - sector of industry with differing prof influencers

Organisation - intermix of subcultures and divisions within org itself

Question 19

4 elements within geographical cultural frame

Answer 19

• Relationship with authority
• Acceptance of inequality
• Longevity of a vision
• Tolerance of uncertainty

Question 20

3 elements within organisational field cultural frame

Answer 20

Categorisation (labelling of activities)
Recipes (set of assumptions, norms, routines * ‘best practice’)
Legitimacy (institutionalisation of categories and recipes across period of time)

Question 21

4 elements within organisation cultural frame

Answer 21

Mission - underlying causes of the heartbeat
Methods - habits of an organisation, why tasks are carried out in certain ways
Principles - hierarchical structure, flow of information
Values - fundamental beliefs about humanity that pervade the organisation

Question 22

Deal & Kennedy - 6 interlocked elements of culture

Answer 22

History - sharing narrative of past
Values and beliefs - sharing what it important
Rituals and ceremonies - everyday habits
Stories - inherited tales of why things happen the way they do
Heroic figures - - previous and current charismatic leaders
Cultural network - communication routes that enable people to find out what they know

Question 23

Deal & Kennedy’s four distinct types of culture (and whether they are high/low risk, and fast/slow feedback) (and example of industry)

Note - feedback refers to speed of which success of failure of decisions will be clear

Hint: weird names

Answer 23

Work hard and play hard - low risk, fast feedback (sales departments)

Process - low risk, slow feedback (banks)

Macho, tough guy - high risk, fast feedback (sport)

Bet-your-company - high risk, slow feedback (oil companies)

Question 24

What does Deal & Kennedy’s model suggest re. assumed cultures?

Answer 24

Cultures of companies are to a degree set in that they will fall into one of the four distinct types of culture depending on which sector the organisation exists on (usually but obviously exceptions)

Question 25

Johnson’s cultural web - 6 elements

Answer 25

Organisational structures - formal hierarchical lines and lines of communication

Power structures - the people who ultimately hold the power

Symbols - tangible visible presence of org (logos, cars driven by execs)

Stories - how people talk about the org, myths and realities

Rituals and routines - daily behaviour of individuals

Control systems - methods of monitoring and maintaining people

Question 26

Dominant culture

Answer 26

Majority of employees are driven by and moulded by overriding and often unchallenged set of values

Question 27

Strong culture

Answer 27

Core values are widely shared within org and drive org forward

Question 28

Goldsmith and Clutterbuck - 7 pros of strong culture

Answer 28

Provides sense of identity
Develops commitment
Shapes behaviour
Internalises control systems
Support and sustain decision-making
Eases communication and co-operation
Decreases ambiguity

Question 29

Weak culture

Answer 29

Minority are striving to get their views and values heard, following own goals rather than those of org

Question 30

Why can a weak culture become a liability?

Answer 30

Provides a barrier to change, as prevailing culture will not be aligned, ie disconnected, with org’s goals

Question 31

Why can a strong/dominant culture become a liability?

Answer 31

Insistence on maintaining core values can lead to failure if org fails to recognise where values are out of step with changing macro environment

Question 32

6 areas that require constant vigilance to ensure alignment of the strategy with the culture of the organisation

Answer 32

silo thinking
dominant chief executive
leadership arrogance
lack of openness to challenge
lack of diversity
hierarchical attitude

Question 33

Why is it key for a CoSec to have a very close awareness of the culture of an organisation?

Answer 33

It helps explain people and organisational behaviour, and can be a significant area for an objective CoSec to challenge

Question 34

Why is culture so relevant to strategy

Answer 34

It is impossible to consider the dev of strategy without understanding nature of org culture, individuals, and other companies within sector.

In order to deliver sustainable strategic change, the culture of the organisation may need to be changed, as a conflicting culture can hold the strategy back.