Chapter Outline:

The manager: omnipotent or symbolic?
The external environment: constraints and challenges:
Organizational culture: constraints and challenges:
Current issues in organizational culture:

2.1. The Manager: Omnipotent or Symbolic

Omnipotent view:

It says that managers are directly responsible for organization’ good or bad performance,

They are rewarded when the organization perform well and get fired if organization face failures.

Symbolic view:

It says managers are not responsible for company’s bad or good performance, it is because of external environment i.e., govt. policies, economy, customers etc.

So, managers are not accountable as per this view

2.2. External Environment: Constraints and Challenges:

External environment:

External environment refers to the factors which directly or in directly effects organizations performance,

These factors are:

· Economic:

It includes different things like interest rate, inflation in the economy etc.

· Global:

Global factors may include the rules set for import and export for doing business, or embargos on different countries.

· Political/legal:

Every country has different set of rules for doing business. It may be business friendly or not. Such as privatization or public sectors.

· Demographics:

Demographic factors are presences of residents of certain area, their taste, age, geographic location etc.

· Technological:

Technology is getting advance day by day, so huge technology gap exists between developed countries and developing countries.

· Sociocultural:

Sociocultural factors include societal or cultural factors such as beliefs of people, their value or attitude etc.

The economic environment:

Various aspects can be discussed here for example,

· If low rate loans are not available to the companies,

· Fuel prices will affect the rates of products, if bought when the price of fuel was high and after purchase fuel prices go down, then you cannot compete in market with competitors.

· Same thing goes with currency rates against US dollar.

· If residents of country lose purchasing power

The demographic environment:

Demographic factors have great effect over organizations performance,

· Such as age, people of different age prefer different products,

· If we take taste factor, we can find significant difference between the taste of European and Asian people.

· Geographic location: people of colder areas prefer to eat and wear very differently than people of warmer areas

How the external environment affects managers?

knowing the answer of two questions is very much important here that is “what” and “how”

components of external environment effect manager’s job.

· Jobs and employment:

External environment greatly affects the creation & elimination of jobs and employment.

e.g., during recession so many people lose their jobs.

Freelancers are hired to cut down the company expanses, they work full time but don’t get the status and perks of permanent employee.

So, managers have to keep eye on maintaining balance elimination and creation of jobs while facing the external environment.

· Assessing environmental uncertainty:

it is caused by the external environment if uncertainty is found in that environment.

Environmental uncertainty

Ø Stable environment

A stable environment is the one where almost no changes occur, e.g. no new competitors, very few technological changes etc.

Ø Dynamic environment

If frequent changes occur in the environment, it’s called as dynamic environment, i.e. day by day new competitors, rapid technological changes. E.g. Online selling stores.

Environmental complexity

It refers to the number of components in organizations environment and the knowledge managers have about it, having few competitors company face less complexity and with rise in competitors in the market raises the environmental complexity.

· Managing stakeholder relationships:

Every person that is effected by company’ actions and decisions, he or she is stakeholder.

They can be internal or external.

To build a good relationship with stakeholders is important to fulfill the expectations of stakeholders and to improve organizational performance.

Stakeholders:

Employees

Customers

Competitors

Shareholders

Media

Suppliers

Unions

Trade associations, etc.

2.3. Organizational Culture: Constraints and Challenges:

Every company or organization have some rules and regulations for its employees, that is the part of organizational culture, employees work, act and interact with each other following that culture.

Three aspects of culture

Perception:

Culture is not something that is tangible, but it is perceived on the basis of experience.

Descriptive:

It has no concern with whether employees like it or not, it is purely how they perceive
it and describe it.

Shared:

Finally, individual from any background are supposed to follow the organizational
culture. It is shared among employees.

Strong culture	Weak culture
In strong cultures , values are widely shared among employees.	Values are shared among with fewer people, often among top management.
In this employees receive consistent messages about , what is important.	Employees receive contradictory messages about what is important.
Employees know the history of company, and they often tell stories about its heroes	Employees don’t know the history of company or remember any heroes
Employees strongly identify with culture	Employees have little identification with culture.
There is strong connection between behaviors and shared values.	There is little connection between behaviors and shared values.
Employees in the organization having strong culture are more loyal	Employees in the organization having weak culture are less loyal.
In organizations with strong culture employees know exactly what they are supposed to do.	Every employee performs his duty in his own way., and have different working styles.
Employees are not allowed to try new techniques.	Employees are allowed to try new techniques.

· Where culture come from and how it continues

o It depends upon how top management or founders of company wants there company to be.

o As per there set beliefs they recruit employees.

o Through socialization and training sessions organization’s culture penetrate among existing and new employees.

· How employees learn culture

Companies can make their employees to learn the culture in many ways.

Ø Stories

Stories are told to employees about their heroes, and about the reactions and decisions of top management regarding mistakes or frauds etc. to make them learns the things accordingly.

Ø Rituals

It may include different events or styles of top management treating their employees,

e.g annual prize distribution ceremonies. Such ceremonies encourage employees to work hard.

Ø Material artifacts and symbols

when we visit a company, we can learn the environment, employees work inn. Whether its casual, formal, fun loving, serious etc. that is the power of material symbols in making personality of an organization.

What do employees wear, conveyance facility provided to staff, office size and its furnishing are also the examples of material symbols.

Ø Language

Many organizations use short and key word to express some important message to their employees,

e.g. “chiff” stands for clever, high-quality, innovative, friendly, fun.

· How culture effect managers

It refers towards the point that managers are bound to adopt the organization’ culture in all four management functions, i-e Planning, Organizing, Leading and Controlling

Planning:

e.g. how much risk should be involved in plans.

Planning is a task of an individual or team. Etc.

Organizing:

Do the employees will be autonomous in their jobs,

Whether the tasks would be performed by individual or team.

How much managers of different departments will interact with each other?

Leading:

Which leadership style is suitable.

Do the managers are concerned with employee job satisfaction.

Controlling

Who will control the actions of employees, whether external controls would be imposed or employees will do it by themselves.

Which criteria would be used while evaluating employee’s performance.

2.4. Current issues in Organizational Culture:

Organizations may have 3 different types of cultures

Creating an innovative culture:

Any successful organization needs a culture that support innovation. According to Swedish researcher innovative culture can be like:

· Challenge and Involvement: do employees are motivated and involved enough to achieve the organizational goals

· Freedom: do employees are allowed to bring innovation in their routine day-to-day work.

· Trust and openness: do employees hesitate or cooperative respectfully with each other.

· Idea time: do employees find time to discuss a new idea before execution.

· Playfulness/Humor: do employees find time to relax and have some fun.

· Conflict resolution: how do employees take decision by taking organizational interest or personal interests in mind.

· Debates: do employees are allowed to share their ideas before top management for consideration and review.

· Risk taking: do managers support or oppose risk taking employee.

Creating a customer-responsive culture.

If company is customer responsive, it will repeat customer visits.

I am personally very much satisfied with customer services of Uni-worth, a clothing brand.

And again I am personally very much dissatisfied with the customer services of a bank.

Characteristics of Customer-responsive culture:

· Type of employee

Managers should hire such employees who have got customer services related aptitude.

· Type of job environment

Job environment should be so flexible, so that employees can give beyond the line customer services to make them satisfied.

· Empowerment

Customer services employees should be little empowered in order to order to fulfill customer needs.

· Role clarity

Reduce uncertainty about what employees are allowed to do and which things are strictly not allowed.

· Consistent desire to satisfy and delight customers

Give your employees clear message to do whatever is needed for customer satisfaction.

3.4. Spirituality and organizational culture:

Workplace spirituality

This term refers towards a point; people should not do such job which they don’t want to do. They should do the work with their hearts.

Their work should have spirit and purpose. Spiritual organizations have following characteristics.

· Strong sense of purpose

Spiritual organizations exhibit a culture which have a meaningful purpose. Profits are important, but for such organizations profit is not a primary purpose.

Such organizations may have purpose of helping poor. etc.,

· Focus on individual development

Such organizations know the worth of employees; they don’t just provide them jobs but provide them opportunity to grow.

· Trust and openness:

Spiritual companies encourage trust and openness of employees; they build a culture of mutual trust. Managers or senior staff don’t hesitate while admitting

their mistakes.

Managers have so friendly relationship with all employees, customers and suppliers.

· Employee empowerment:

Give enough space to employees so that they can do whatever is needed to satisfy the customer needs.

· Toleration of employee expression

Final point that differentiates spiritual organization from other is that they allow their employees to show their emotions and moods without any fear and hesitation.