Corporate Culture (3.4.2) Flashcards
What is Corporate Culture?
Corporate culture refers to the values, beliefs, and behaviors that are common or understood at a company. These determine how a company’s employees and management interact, perform, and handle business transactions. Often, corporate culture is implied, not expressly defined, and develops organically over time from the cumulative traits of the people that the company hires.
What is Culture Development?
-The aims or missions of the business
-The behavior of senior staff
-The attitude of senior staff to risk
-Recruitment and training procedures
What is strong culture?
-Focus on customer needs and allowing staff to make decisions
-Staff show emotion for the business and commit long-term
-United view among staff that business is doing something good
-United view among staff on teamwork
-Sticking together in times of crisis
What is weak culture?
-Staff follow script with customers as they aren’t trusted
-Staff show commitment to their department, not the business
-Cynical view among staff about the true business principles
-Staff look after themselves, not their colleagues
-In times of crisis senior staff seek new jobs
What is Short-Termism?
Concentration on short-term projects or objectives for immediate profit at the expense of long-term security
What are the dangers of Short-Termism?
By prioritizing immediate profits over long-term growth and investment, CEOs may inadvertently hinder a company’s progress, impede innovation opportunities, and strain stakeholder relationships.
What is evidence-based decision making?
Using data and analysis to justify decision-making
What is subjective decision making?
Using intuition and ‘hunches’ of influential staff to make a decision. Used when data is uncertain or incomplete and markets are unpredictable or in crisis situations where isn’t possible to gather data.
What is strong organizational culture?
-Focus on customer needs and allowing staff to make decisions.
-Staff show emotion for the business and commit long-term.
What is weak organizational culture?
-Staff follow script with customers as they aren’t trusted and so look after themselves, not their colleagues.
What is Handy’s Classification of culture?
Guiding principles around how power is managed and decisions are made with an organisation.
Handy outlined four types of culture:
-Power Culture
-Role Culture
-Task Culture
-Person Culture
What is Power Culture?
-All decisions go through those in control
-Little in the way of rules and procedures
-Employees judged on what they achieve not how achieved
-Business practice can become unethical
-Everything done to please boss
-Can be toxic
What is Role Culture?
-Power depends on position you hold
-Specific rules and procedure to be followed
-Vertical Communication=Slow
-Good in stable, certain markets
-Not so good in dynamic markets that require flexibility to change
What is Task Culture?
-No single power source
-Multi-department teams assembled for projects
-Power within teams lies in expertise, not role
-Good in dynamic markets
-Not so good in stable, long-term markets as teams loose sense of business objectives
What is Person Culture?
-Individuals see themselves as superior to business
-Organization exists for individuals to work
-Workers bring specific skills or client bases to business
-Found in professions such as law, accountants etc..
