Topic 1 - Organizational behavior + national and organizational culture

Summary

Culture can be defined as all the shared values, understandings and goals that the previous generations teaches to the current ones. Those teachings becomes into common attitudes, codes of conduct and expectations that guide the behavior of the society.

The organizational cultures are all the expectations, norms and goals which are common to a group inside an organization, company or institutions, which might vary from one organization to another.

There are two main types of cultural variables in a national culture, the observable ones which are the symbols, ceremonies, religion, stories, slogans behaviors, physical settings and all those things that are easily visible; and the underlying variables, such as assumptions, beliefs, attitudes, feelings, among others.

There are several cultural dimensions, such as the Project Globe, Cultural Clusters by Gupta, Trompenaar’s cultural dimensions and the Hofstede’s cultural dimensions which try to analyze the different cultural aspects and variables and try to understand how those variables affect the life of the different countries and regions.

According to Edgar Schein, and the review on class, “Organizational culture in a business is like an apple in an orchard. Both have layers serving distinct purposes. For example, to get to the core of the apple, you must first eat the outside, and likewise, to get the core of a culture, you must recognize the artifacts and symbols, which make up the outermost layer.” (Taken from notes class, Cristina Robledo, The role of culture – national and organizational culture. Slide 25).

It is important to understand the organizational culture, since it can provide a competitive advantage to know a company behaves, also how to influence the decision making and to gain the respect of the employees of the organization.

The two main functions of the organizational culture are to create an internal integration in order to know how to relate with the members inside the organization, and the external adaptation in order to help the organization to adapt to the environment.

The main advantages of a strong organizational culture are that they are liked with the performance and the motivation and commitment of the employees to the company, the core values are shared and internalized and cultivate learning environment. However, there are some disadvantages as well, such as an inflexible cultural barrier and protection against the changes. That’s why it is suggested that a good organizational culture is the one which is flexible and takes the strengths of a strong and weak organizational culture, but to reach that point is difficult and requires commitment from the company.

Source: Class presentations from Cristina Robledo.

1. Find and explain in your blog two real life examples about the business implications of national and organizational culture. You may not use examples or situations already discussed in class or in the recommended readings.

Example 1: Google in China.

Taken from http://www.fakesteve.net/tag/google-be-less-evil on Autust 16th 2010.

Google is an American based Company, which allows the people in general to search almost all type of information. In their expansion process, they decided to arrive to China since it’s the most populated country in the world (1.324’655.000 inhabitants. Data source: World Bank, World Development Indicators http://data.worldbank.org/data-catalog/world-development-indicators?cid=GPD_WDI - Last updated July 26, 2010) and also one of the countries with the highest growing economic rate in recent history (10.3% on 2009, http://www.tradingeconomics.com/Economics/GDP-Growth.aspx?Symbol=CNY accessed on August 15^th 2010).

Since the strategic mission of Google is “to organize the world's information and make it universally accessible and useful” (taken from the Google Corporate web page http://www.google.com/corporate/, accessed on August 15^th 2010), they tend to avoid as much as possible the censorship in order to provide the information services that the public requires. However, the Chinese government is very jealous with the information that is available to the public and that leaves the country.

That’s why the Chinese government decided to put some restrictions on the search engine web page in order to avoid that some compromising information would be known by the general public, and a censorship was applied. That news was not taken so lightly by Google since the press censorship is not so common in the USA, so Google decided to sue the Chinese government.

However, the Chinese government won the trial and Google had to put some restrictions on their search engine in order to block some content on their web page and also, they had to make some negotiations with Hong Kong (since they have a different legislation) to don’t leave the country. Additionally, the Chinese government created a new search engine in order to make some competition to Google.

Example 2: HSBC in Colombia.

Taken from http://colombia.indymedia.org/news/2007/10/73717_comment.php on August 16th 2010.

HSBC is a bank from Hong Kong and Shanghai, where the labor unions are not strong and are sometimes even abolished by the State; however in Colombia they are quite powerful in order to guarantee the social fairness, especially on labor conditions. When they decided to enter in Colombia, they put a condition to the people who was going to work for them: to abolish the labor union in which they were members (the UNEB and the Asociación Colombiana de Empleados Bancarions (ACEB)) and, therefore, to relinquish to the rights that these unions provide.

Trying to reach an agreement, the bank negotiated with the labor union leaders in order to change the initial conditions; however, the negotiations were difficult and they decided to go to the Colombian Social Protection Ministry in order to solve this situation. HSBC had to change that corporate policy in order to start their operations in the country.

2. Write a short essay considering the following questions: (500 words)

- Do you think there is a corporate culture in every organization?

- If we assume there is: Can it be modified?

I do believe that there is a corporate culture in every organization, since all of them behave in a different way in the society and the way they do everything is different from them. The corporate values also vary from every organization and their internal policies may also differ and, considering the fact that there are companies which arrive from every country in the world, they also bring part of their national culture to their corporate culture (even though they might not bring totally their national culture to the host country).

It might be possible that the corporate culture of an organization can be modified, as stated by Adler and Jelinek (1986): “Fundamental to the organization culture concept is the belief that top management can create, maintain and change the culture of an organization… Management’s influence is seen as capable of changing or erasing other influences on employees’ behavior… work environment influences are seen to dominate private life conditioning… moreover, employees are seen as capable of changing; and change, in and of itself, is basically good”. It can be possible that if certain values and culture characteristics are quite obsolete for a national culture, it can be adapted to the society in order to continue operating there.

However, it rises the question of how ethical is to chance or modify the corporate culture of an organization. Peters and Waterman (1982) say: “Culture Excellence is a struggle for identities, an attempt to enable all sorts of people, from highest executive to lowliest shop-floor employee, to see themselves reflected in the emerging conception of the enterprising organization and thus to come increasingly to identify with it”. A strong corporate culture is what makes the employees (and in some cases even the customers) to follow the organization, and if it’s made only to be shaped, then it will be assumed that there will be lost a sense of identity to the corporation, the value of belonging will diminish and the people within the organization won’t feel identified with their work. As stated by Payne (1991): “The objective of firms when they seek employee commitment is to gain it willingly. A strong culture is effective in controlling people precisely because it is willingly shared by members themselves”; then, one of the main purposes of corporate culture is to make the employees to commit to the organization’s values and to feel identified with them.

But, sometimes the people inside a corporation might feel that the corporate culture doesn’t support the progress within the company. That’s why an organization should have a culture which allows the people to make constructive ideas. As it is said on the book Human Resources Management (page 134): “A ‘culture’ is double-edged if it totally absorbs people and produces a high degree of conformity, because in the end it is self-defeating”. That means that there must be a point of adaptation but without losing the sense of identity, because the extreme points are the ones who harm a company’s organizational culture.