CHAPTER 3: THE ENVIRONMENT AND CORPORATE CULTURE I, External Environment - Definition: All elements existing outside the boundary of the organization that have the potential to affect th
Trang 1CHAPTER 3: THE ENVIRONMENT AND CORPORATE CULTURE
KSFs for the Beer Industry KSFs for Apparel Manufacturing
Industry KSFs for Tin and Aluminum Can Industry
Full utilization of brewing
capacity - to keep manufacturing
costs low
Appealing designs and color combinations - to create buyer appeal
Locating plants close to end-use customers - to keep costs of shipping empty cans low
Strong network of wholesale
distributors - to gain access to
retail outlets
Low- cost manufacturing efficiency - to keep selling prices competitive
Ability to market plant output within economical shipping distances
Clever advertising - to induce
beer drinkers to buy a particular
-> Changes in these various sectors can create tremendous challenges
Internal environment: Elements withing the organization's boundaries
1 General environment
1.1 International Dimension
Portion of the external environment that represents events originating in foreign countries as well as opportunities for U.S companies in other countries Events originating in foreign countries Impacts all aspects of the external environment
New competitors
Trang 2+ Society at large Handheld devices
- General economic health
+ Consumer purchasing power
+ Unemployment rate
+ Interest rates
- Recent trends
+ Frequency of mergers and acquisitions
+ Small business sector vitality
1.5 Legal-Political Dimension
Federal, state and local government regulations
Political activities designed to influence company behavior
Dimension of the general environment that includes federal, state, and local government regulations and political activities designed to influence company behavotr
Trang 31.6 Natural Dimension
Concern for the environment
The natural dimension has no voice
Pressure comes from advocacy and managers
+ Eliminate nonbiodegradable plastic bags from the environment
+ Improving efficiency of plants and factories
+ Investing in cleaner technologies
2 Task environment
2.1 Customers
2.2 Competitors
2.3 Suppliers
2.4 Labor Market Forces Affecting Organizations today
Growing need for computer literate information technology workers
Necessity for ongoing investment in human resources - recruitment, education, training
Effects of international trading blocks, automation, outsourcing, shifting facility locations upon labor
dislocations
Disney We run theme park We provide fantastic and amusing atmosphere - A place
making US everlating attraction
Nike We sell shoes We help people experience competition, victory, and feelings
of outcompeting rivals
Revlon We manufacture We sell life style and self-actualization; success and position;
Wal-Mart We run discounted store Everyday low price
Managing the Organizatoinal Environment
- Environmental Change: The degree to which forces in the task and general environments change and evolve over time
- Reduce the Impact of Environmental Forces:
+ Top management: devise strategies that take advantage of opportunities and counter threats
+ Middle managers: collecting about competitors’ intentions, new customers, and new suppliers for the firm's crucial or low-cost inputs
+ First-line managers: use resources efficiently and get closer to customers
- Creating an Organizational Structure
Trang 42 Adapting to the Environment
2.1 Boundary-Spanning Roles: Coordinating the organization with key elements in the external environment
- Boudary-Spanning Leadership
+ In nature, where two ecosystems meet is where you have the most diversity in new life forms
+ "Today's business landscape requires leaders to bridge boundaries to tap the innovative outcomes that lie
at the intersection of groups working together."
Competitive intelligence: activities to get as much information as possible about one's rivals
2.2 Interorganizational Partnerships: collaborating with other organizations
2.3 Mergers: Combination of two organizations
2.4 Joint Ventures: an alliance of organizations for a specific project
3 Information and feedback limited 3 E-business links to share information and
conduct digital transactions
Trang 5The set of key values, beliefs, understandings and norms that members of an organization share
Corporate culture should match the needs of the external environment
The importance of corporate culture has been growing
Culture is a pattern of shared values
"how things are done."
- Visible Manifestations
+ Symbols: an object, act, or event that conveys meaning to others
+ Stories: a narrative based on true events that is repeated and shared among organizational employees + Heroes: a figure who exemplifies the deeds, character, and attributes of a strong corporate culture + Slogans: a phrase or sentence that succincltly expresses a key organizational value
+ Ceremonies: a planned affair that makes up a special event and is conducted for the benefit of an audience
- Environment and Culture:
+ The external environment influences culture
+ The internal environment should embody the requirements for success
+ Manager’s must pay attention to culture
Recognize the ways culture can help or hurt your department
IV Types of corporate cultures
Visible Behavior Managers pay close attention to Managers tend to behave
all their consituencies, especially | somewhat insularly, politically, customers, and unitiate change and bureaucratically
when needed to serve their As a result, they do not change legitimate interests, even if it their strategies quickly to adjust entails taking some risks to or take advantage of changes
in their business environments Expressed Values Managers care deeply about Managers care mainly about
customers, stockholders, and
employees They also strongly value people and processes that can create useful change (e.g., leadership initiatives up and down the management
work group, or some product (or technology) associated with that work group They value the orderly and risk-reducing management process much more highly than leadership initiatives
Four types of Corporate Culture
- Adaptability culture: is characterized by values that support the company's ability to rapidly detect, interpret, and translate signals from the environment into new behavior responses
Trang 6- Achievement culture: is a results-oriented culture that values competItIveness, àøresiveness, personal initiative, and willingness to work long and hard to achieve results
- Involvement culture: places high value on meeting the needs of employees and values cooperation and equality
- Consistency culture: values and rewards a methodical, rational, orderly way of doing things
V Shaping corporate culture for innovative responsive
How people are treated increase a company’s value?
Culture attracts, motivates and retains
Corporate culture enables learning and innovation
1 High-Performance Culture
- Aculture that:
+ Is based on a solid organizational mission or purpose
+ Embodies shared adaptive values that guide decisions and business practices
+ Encourages individual employee ownership of both bottom-line results and the organization's cultural backbone
- Combining culture and performance
- Industry Leading Success - The LEGO Story
+ 2015, they were nominated by Forboes as the most powerful brand
+ Hired so-called "adults fans of LEGO" for their design team and began to crowdsource new toy kits + Open innovation policy by opening up the LEGO ideas portal
+ Online platform generated hundreds of new product suggestions each employing everything from social media to peer selection to entice fans into contributing new designs
2 Cultural Leadership
Trang 7- Articulate a vision for the organizational culture that employees can believe in
- The cultural leader heeds the day-to-day activities that reinforce the cultural vision
- Managers communicate the cultural values through words and actions
- Cultural leaders uphold their commitment to values during difficult times
CHAPTER 5: ETHICS AND SOCIAL RESPONSIBILITY
- Managers sometimes need courage to stand up and do the right thing
- Ethics is about making choices
- Three Domains of Human Action
Đamaín øf Free Choie (Ptrsonal Staadard) Explicit Control
II Ethical Management Today
\ False or deceptive sales
~ Creating a hostile work ¥ Breaching database controls
environment ¥ Using confidential information
“Violating TW rules — Z
_Toward Suppliers
~ Accepting favors or kickbacks
¥ Violating contract terms
¥ Paying without accurate records
or Invoice
Violating environmental standards
> Exposing public to safety risks
Violating international human
II Ethical Dilemma
A situation that arises when all alternative choices or behaviors have been deemed undesirable because
Of popentially negative ethical consequences, making it difficult to distinguish right from wrong
IV Criteria for Ethical Decision Making
Trang 8- Most ethical dilemmas involve
+ Conflict between needs of the part & whole
Organization versus society as a whole
Individual versus the organization
- Managers benefit from a normative strategy to guide their decision making - norms and values
Ethical Decision Making Approaches
Utilitarian
Approach - Moral behavior produces the greatest good for the greatest number - A decision maker is expected to consider the effect of each decision alternative on all
parties and select the one that optimizea the benefits for the greatest numbers of people
- Ex - recent trend among companies to monitor employee use of the Internet
Individualis
m Approach ultimately leads to the greater good - Acts are moral when they promote the individual's best long-term interests, which
- Individual self-direction paramount
- Individualism is believed to lead to honesty& integrity since that works best in the long run
- However, top executives from WorldCom, Enron, Tyco demonstrate flaws of approach
Moral-Rights - Moral decisions are those that best maintain the nights of those people affected by them
Approach - An ethical decision is one that avoids interfering with the fundamental rights of others
- E.g To monitor employee's nonwork activities violates the right to privacy
- Six Moral Rights:
+ The right of free consent
+ The right of privacy
+ The right of freedom of conscience
+ The right of free speech
+ The right to due process
+ The right to life and safety
Justice - Moral Decisions | Distributive - Different treatment of people should not be based Approach must be based on | Justice: on arbitrary characteristics
standards of - In case of substantive differences, people should be equity, fairness, treated differently in proportion to the differences
- Three types of | Procedural - Rules should be clearly stated
Justice Justice: - Rules shouls be consistently and impartially
Virtue Ethics | - The moral behavior stems from personal virtues
Approach - Managers develop their ability to do the right thing and motivation to do right rather
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Level 3: Postconventional Follows self-chosen principles of justice and right Aware that people hold Level 2: Conventional different values and seeks
creative solutions to ethical dilenmas Balances concern Level 1: Preconventional " for individual with concern
+ Values adopted within the organization are highly important
+ Most people believe their duty is to fulfill obligations and expectations of others
V Manager Ethical Choices
VI What is Corporate Social Responsibility?
- Organization's obligation to make decisions and take actions that will enhance the welfare and interests of society and organization
- Being a good corporate citizen
- Difficulty in understanding - issues can be ambiguous with respect to right and wrong
- Organizational Stakeholders:
+ Any group within or outside the organization that has a stake in the organization's performance + Each stakeholder:
Has a different criterion of responsiveness
Has a different interest in the company
- The Green Movement:
+ Is a special interest group of particular importance today
+ Sustainability refers to economic development that generates wealth and meets the needs of the current population while preserving the environment for the needs of future generations
(General Electric, Nike, Wal-Mart, interface)
Environmental Responsibility Commitment
Trang 10> To search for ways to
=>) conserve the Earth's
Responsibility Responsibility sàn Đ2nnvV Ly paren) 1-0) Contribute to the
Be ?rofitable 0bey the Law Do Wiat Is 8ight Ps a)
expected to fulfill their
economic goals within
the legal framework
fis purely voluntary
land guided by a
company’s desire to make social contributions not mandated by economics, law, or ethics
- The Ethical Organization
+ The three Pillars of an Ethical Organization
Trang 11a) Organizational Mission
- The Mission is the reason the organization exists:
+ Top of the goal hierarchy
+ Describes the values, aspirations and reason for being
+ A well-defined mission is the basis for all other goals
- Mission Statement:
+ Broadly states the basic business scope and operations that distinguishes it from similar types of
organizations
+ May include the market and customers
+ Some may describe company values, product quality, attitudes toward employees
- Mission statements outline the stated purpose and values to stakeholders
want to buy online"
Vingrou | "to create a better life for the Vietnamese people" ‘with pioneering aspirations and a
Vingroup positions itself as the property developer and retailer in Vietnam, with growing reputation and position on the global economic map and a portfolio of quality products and services
ISVNU position on the global economic map and a portfolio
of quality products and services international
accreditation criteria on the basis of fundamental,
applied and inter- disciplinary sciences in order to
contribute to providing highly qualified human
resources and scientific and technological products of
international standards for the country's
- Where the organization wants to be in the future - Pertain to the organization as a whole
- Action Steps used to attain strategic goals - Blueprint that defines the organizational activities and resource allocations
Trang 12
| - Tends to be long term
4 Tactical Goals and Plans (Level 3 — By Middle Management)
- Specific, measurable results
- Expected from departments, work groups, and
individuals
- To specify action steps toward achieving operational goals
- Tool for daily and weekly operations
- Schedules are an important component
- Official goals, broad statements
about the organization
- Define the action steps the
company intends to attain
- The blueprint that defines
- Lower levels of the organization
- Specific action steps
7 Goal Alignment with strategy map
- Strategy map: A visual representation of the key drivers of an organization’s success, showing the cause- and-effect relationship among goals and plans
Strong supply chain for entertainment and
information services, exclusive agreements
Customer Service
Clarity in offering that surpasses anything
in the market today, best user interface
Transforming society through the provision of ultra-high speed mobile information services The number one provider of ultra-high speed mobile information networks across the United Kingdom and Europe
Brand Awareness
Reinvigorated brand based on successes
attract a wider and younger audience