Chapter 12: Corporate Culture and Leadership

Question 1

What is corporate culture?

Answer 1

Shared values, ingrained attitudes, core beliefs, and company traditions that determine norms of behaviour, accepted work practices, and styles of operating.

Question 2

What is a company’s culture shaped by?

Answer 2

Its core values and ethical standards.

Question 3

What must happen after values and ethical standards have been formally adopted?

Answer 3

They must be institutionalized in the company’s policies and practices and embedded in the conduct of company personnel.

Question 4

What must companies do to deeply ingrain their stated core values and ethical standards?

Answer 4

Turn them into strictly enforced cultural norms.

Question 5

What are subcultures?

Answer 5

Multiple cultures that exist within a company as values, beliefs, and practices can vary by department, geographic location, division, or business unit.

Question 6

What is the hallmark of a strong-culture company?

Answer 6

The dominating presence of certain deeply rooted values, business principles, and behavioural norms that “regulate” the conduct of company personnel and determine the climate of the workplace.

Question 7

If a company expects that company personnel will behave in accordance with adopted values, what 2 outcomes will occur?

Answer 7

1. People who dislike the culture tend to leave

2. Individuals encounter strong pressure to observe the culturally approved norms and behaviours

Question 8

Which two factors contribute to the development of strong cultures?

Answer 8

1. A founder or strong leader who established core values are viewed as having contributed to the success of the company
2. A sincere, long-standing commitment to operating in accordance to these traditions and values

Question 9

What defines a weak-culture company?

Answer 9

Lack widely shared and strongly held values, principles, and behavioural norms.

Question 10

Why do weak cultures provide little or no assistance in executing strategy?

Answer 10

There are no traditions, beliefs, values, common bonds, or behavioural norms that management can use as levers to mobilize commitment to executing the strategy.

Question 11

How are performance expectations stated in high-performance cultures?

Answer 11

Clearly delineated for the company as a whole, for each organizational unit, and for each individual.

Question 12

What are the 2 types of cultures aside from strong and weak cultures?

Answer 12

High-performance cultures and adaptive cultures

Question 13

What is the hallmark of adaptive corporate cultures?

Answer 13

Willingness on the part of organization members to accept change and take on the challenge of introducing and executing new strategies. Company personnel feel confident that the organization can deal with whatever threats and opportunities arise.

Question 14

What are the 2 distinctive traits of an adaptive culture?

Answer 14

1. Changes in operating practices and behaviours must not compromise core values and business principles
2. Changes that are instituted must satisfy the legitimate interests of key stakeholders

Question 15

What are 5 unhealthy cultures?

Answer 15

1. Change-resistant cultures
2. Politicized cultures
3. Insular, inwardly focused cultures
4. Unethical and greed-driven cultures
5. Incompatible, clashing subcultures

Question 16

What do managers tend to do in change-resistant company cultures?

Answer 16

A premium is placed on not making mistakes, prompting managers to lean toward safe, conservative options intended to maintain the status quo, protect their power base, and guard their immediate interests.

Question 17

Which types of companies tend to have change-resistant cultures?

Answer 17

Companies clinging to what made them successful.

Question 18

What is unhealthy about highly politicized cultures?

Answer 18

Political infighting consumes a great deal of organizational energy and what’s best for the company tends to take a backseat to political maneuvering.

Question 19

Which companies tend to have inwardly focused cultures?

Answer 19

Companies that have reigned so long as an industry leader that its personnel start to believe they have all the answers or can develop them on their own.

Question 20

What tends to happen to employees of companies with inwardly focused cultures?

Answer 20

There’s a strong tendency to neglect what customers are saying and how heir needs and expectations are changing. This type of culture breeds arrogance and gives rise to managerial inbreeding and a failure to recruit people with outside perspectives.

Question 21

What tends to occur in companies with clashing subcultures?

Answer 21

Can prevent a company from coordinating its efforts to craft and execute strategy and can distract personnel from the business of the business.

Question 22

What should management do when a company’s culture is unhealthy?

Answer 22

Eliminate any unhealthy/dysfunctional cultural traits as fast as possible and aggressively strive to ingrain new behaviours and work practices that will enable first-rate strategy execution.

Question 23

What is the single most visible factor that distinguishes successful culture-change efforts from failed attempts?

Answer 23

Competent leadership at the top.

Question 24

What are the 4 steps to changing a problem culture?

Answer 24

1. Identify facets of present culture that are dysfunctional
2. Specify what new actions/practices should characterize new culture
3. Explain why current culture poses problems, make a persuasive case for cultural reform
4. Follow with visible, forceful action - both substantive and symbolic

Question 25

What is the way for mgmt to begin a major remodeling of corporate culture?

Answer 25

Selling company personnel on the need for new-style behaviours.