Chapter 12 : Corporate Culture and Leadership
Chapter 12 : Corporate Culture and Leadership MGT 460
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This 3 page Class Notes was uploaded by Winn on Thursday April 7, 2016. The Class Notes belongs to MGT 460 at Marshall University taught by Dr. Uyi Lawani in Spring 2016. Since its upload, it has received 40 views.
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Date Created: 04/07/16
Chapter 12 : Corporate Culture and Leadership Book : Crafting and executing strategy 19e – Thompson, Peteraf Explaining Important More Important 1) INSTILLING A CORPORATE CULTURE CONDUCIVE TO GOOD STRATEGY EXECUTION Corporate Culture a. Is the meshing of shared values, beliefs, business principles, and traditions that imbues a firm’s operating style, behavioral norms, ingrained attitudes, and work atmosphere. b. Is important because it influences the firm’s actions and approaches to conducting business. Corporate culture refers to the shared values, ingrained attitudes, core beliefs and company traditions that determine norms of behavior, accepted work practices, and styles of operating. 2) IDENTIFYING THE KEY FEATURES OF A COMPANY’S CORPORATE CULTURE A company’s culture is grounded in and shaped by its core values and ethical standards. 3) EMBEDDING CULTURAL NORMS IN THE ORGANIZATION AND PERPETUATING THE CULTURE Screen applicants and hire those who will mesh well with the culture. Incorporate discussions of the firm’s culture and behavioral norms into orientation programs for new employees and training courses for managers and employees. Have senior executives frequently reiterate the importance and role of company values and ethical principles at company events and in internal communications to employees. Expect managers at all levels to be cultural role models and exhibit the advocated cultural norms in their own behavior. Make the display of cultural norms a factor in evaluating each person’s job performance, granting compensation increases, and deciding who to promote. Stress that line managers all the way down to first-level supervisors give ongoing attention to explaining the desired cultural traits and behaviors in their areas and clarifying why they are important. Encourage company personnel to exert strong peer pressure on co-workers to conform to expected cultural norms. Hold periodic ceremonies to honor people who excel in displaying the company values and ethical principles. ♦ A company’s values statement and code of ethics communicate expectations of how employees should conduct themselves in the workplace. ♦ To deeply ingrain the stated core values and high ethical standards, firms must turn them into strictly enforced cultural norms. 4) WHY CORPORATE CULTURES MATTER TO THE STRATEGY EXECUTION PROCESS A culture that is well matched to the chosen strategy and the requirements of the strategy execution effort focuses the attention of employees on what is most important to this effort.. Culture-induced peer pressure further induces personnel to do things in a manner that aids the cause of good strategy execution. A culture that is consistent with the requirements for good strategy execution can energize employees, deepen their commitment to execute the strategy flawlessly, and enhance worker productivity. It is in management’s best interest to dedicate considerable effort to establishing a corporate culture that encourages behaviors and work practices conducive to good strategy execution. 5) CHANGING A PROBLEM CULTURE: THE ROLE OF LEADERSHIP A strong, out of sync, or unhealthy culture must be changed in order to execute strategy successfully. Competent leadership at the top is necessary for culture-change efforts to succeed 6) SUBSTANTIVE CULTURE-CHANGING ACTIONS Replace key executives who are stonewalling needed organizational and cultural changes. Promote individuals who advocate for cultural shifts and can serve as a role model for the cultural behavior. Appoint outsiders with the desired cultural attributes to high-profile positions. Screening all candidates for positions carefully, hiring only those who appear to fit in with the new culture. Mandate that all personnel attend culture-training. Design compensation incentives that boost the pay of teams and individuals. Revise policies and procedures to drive cultural change 7) MOBILIZING THE EFFORT FOR EXCELLENCE IN STRATEGY EXECUTION Treat employees as valued partners. Foster an esprit de corps that energizes members. Use empowerment to create a fully engaged workforce. Set stretch objectives that require personnel to give their best in achieving performance targets. Use benchmarking, reengineering, TQM, and Six Sigma tools to focus attention on continuous improvement. Use motivational techniques and compensation incentives to inspire, nurture a results-oriented work climate, and enforce high standards. Celebrate individual, group, and company successes 8) A FINAL WORD ON LEADING THE PROCESS OF CRAFTING AND EXECUTING STRATEGY It is difficult to separate leading the process of executing strategy from leading the strategy process. Crafting, implementing, and executing strategy is a continuous process that requires much adjusting and fine-tuning of the strategy to fit changing circumstances. The tests of strategic leadership are whether the firm has a good strategy and business model, whether its strategy is competently executed, and whether the firm is achieving its performance targets. If these three conditions exist, then the firm has good strategic leadership and is a well-managed enterprise.
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