Organizational culture

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Excutive summary

Andrew Brown (1995, 1998) stated the organizational culture in his book Organizational
Culture is as follows: “Organizational culture refers to the pattern of beliefs, values and
learned ways of coping with experience that have developed during the course of an
organization’s history, and which tend to be manifested in its material arrangements nd
in the behaviours of its members.” (Shili Sun, 2012, Organizational Culture and Its
Themes, International Journal of Business and Management, Vol 3, No. 12, School of
Foreign Languages, Ludong University). Culture plays an important role in organization,
because it impacts on all aspects on the whole and particularly strategy.
"Organizational culture" is the phrase that most companies are also familiar. But the
question: Which form of culture companies belong to, how to change and construct to
adapt to the new requirements that many leaders still vague. The purpose of the research
is to investigate the organizational culture, to identify and describe the reasons for
changing of organizational culture and the way to implement. From these arguments, the
assignment will provide an example about the successful change of culture of some
Vietnamese companies. I conducted the report by carefully selecting the right theory used
to analyze in addition to collecting information in books and articles.

Introduction

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Organizational culture is one of the most important factors of company’s success or
failure. Each company has an organizational culture, and depending on its strength, the
organizational culture may have a prominent impact on the members of organization, their
values and behavior. The assignment analyzes and evaluates the importance and
necessary of changing culture in organization. This report discusses five issues:
 Identifying organizational culture
 Evaluating the importance of Organizational culture
 Indicating the reasons for changing culture of an organization
 Using Kotter’s eight-step plan to explain the implementation of change;
 Contact the case of Viet Nam
What is organizational culture?
Culture of an organization is a concerned issue, because it plays an important role in
success of an organization. Therefore, there are numerous of definitions about
organizational culture of different scholars.
“Organizational culture is a system of shared meaning held by members that
distinguishes the the organization from other organizations” (Stephen P. Robbins,
Timothy A. Judge, 2011, Organizational behavior, Pearson Education, Inc.,)
Andrew Brown (1995, 1998) stated the definition of organizational culture in his book
Organizational Culture is as follows: “Organizational culture refers to the pattern of
beliefs, values and learned ways of coping with experience that have developed during
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the course of an organization’s history, and which tend to be manifested in its material
arrangements nd in the behaviours of its members.” (Shili Sun, 2012, Organizational
Culture and Its Themes, International Journal of Business and Management, Vol 3, No.
12, School of Foreign Languages, Ludong University)
Organizational culture refers to the complex set of ideologies, symbols, and core values

that are shared throughout the firm and that influence how the firm conducts business
(Hitt, M.A., Ireland, R.D., and Hoskisson, R.E. (2012) Strategic Management: Concepts
and Cases: Competitiveness and Globalization, Edition 7. 8, 9 or 10. South-Western).
Based on these literatures, I suppose that organizational culture is a “soft” factor within an
organization, so, managers need to study carefully and try to find the way to have the
harmony combination between it and other “ hard” factors. Generally, organization
culture is the variety of important values, beliefs, and understandings that members share
in common. Moreover, culture could help managers to make decision and arrange
activities of organization by providing better ways of thinking, feeling and reacting.
Therefore, I believe that a successful organization should have strong cultures.
Why Culture is important in The Organization?
“If you don’t maintain Southwest’s culture, you don’t have anything special.” Colleen
Barrett, former President Southwest Airlines
According to the Michael Porter, successful companies are characterized by following
conditions The first is the presence of high barriers to entry. A second condition is
nonsubstitutable products. Third, a large market share enhances success by allowing your
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firm to capitalize on economies of scale and efficiencies. A fourth condition is low levels
of bargaining power for buyers. Fifth, suppliers have low levels of bargaining power. The
sixth and final condition is rivalry among competitors. However, the most successful U.S.
firms such as Southwest Airlines, Wal-Mar, Tyson Foods, Circuit City, and Plenum
Publishing have not been the recipients of any of the so-called prerequisites for success.
So, what differentiates these extraordinarily successful firms from others? The answer lies
on something less tangible, less blatant, but more powerful than the market factors listed
earlier. The most important competitive advantage of these companies is their
organizational culture (Kim S. Cameron, Robert E. Quinn, 2006, Diagnosing and

Changing Organizational Culture: based on the competing values framework, The
Jossey-Bass Business & Management Series)
A strong, unique culture to reduce collective uncertainties, create social order, create
continuity, create a collective identity and commitment, and clarify a vision of the future.
Therefore, I belive that culture is a crucial factor in the long-term effectiveness of
organizations, it is neccessary that the managers should study or manage organizational
culture to measure key dimensions of culture, develop a strategy for changing it, and
begin an implementation process.

Why organizational culture need to changed?
“If you get the culture right, most of the other stuff will just take care of itself.” Tony
Hsieh, Founder and CEO of Zappos.com
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Changing organizational culture is a process of changing some or all of the elements that
make up the organizational culture such as the concepts of values, ethical standards,
business philosophy, management methods, policy ... which were members accepted.
Changing organizational culture is also the process of consolidation and development of
organizational culture to achieve the goals. Culture is changed to more in line with the
development of organization. The process of changing does not takes place simply, that
require the efforts and contributions of all members of the business. Organizational
culture is formed, strengthened, maintained and developed through generations of
members of organization over the years. Every member implicitly acknowledged cultural
values and very concerned to changing. Because of these reasons, it is very difficult to
make changes organizational culture. So, why organization need to change culture? The
reasons for that may be presented two main groups.

Firstly,

factors indirectly influencing changing of organizational culture (macro-

environment

of

an

organization)

include:

Economic,

Demographic,

Political,

Sociocultural, Global, Technological. The change of these factors lead to the change of
organizational culture, because culture exists around organization, which is an apart of
landscape. When landscape change, culture also need to adjust to match with situation
and strategy. The demographics– for example, the percentage of young people in the
work force grows, therefore, culture require new approaches to knowledge transfer; New
technologies are explosived – requiring new cultural attitudes to realize the benefits;
Attitudes such as these are demonstrative of a culture in need of change; The economic
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environment includes the organization’s market, its competition and its suppliers. Markets
are changing quickly today. In many lines of business competition has become a global
issue. This create pressuare for organization to change the culture for developing
competitive advantage; Socio-cultural Changes are known by feeling in a rapidly
changing, multicultural environment, where they have to face with the impact of
ambiguously known powers from all over the world; Political and legal developments
have their own impacts on changes of organizational culture. Organization is managed by
government, therefore, its culture have to adjust to match with regulatuions and rules of
government. In my opinion, though external factors have indirect influence on change of
culture, it is strong and urgent. Thus, it is critical for managers to find out these factors.

A second group, factors directly influence changing of organizational culture (microenvironment of an organization). When an organization is faced by a changing
marketplace or regulatory environment, a shift in strategy, the implementation of a new
technology, or new processes, the established culture is changed without it will obstruct
these changes. For that reason, the success of major organizational change are almost
always dependent on cultural change. The change of organization’s objectives require
new skills, processes and attitudes to meet the objectives. A new management, a new
team leader, a new boss brings a change in the organization culture according to his style
of working, behaviour and ideologies. Financial loss, bankruptcy, market fluctuations also
result in change in culture of the organization. Acquiring new customers might lead to a
change in the culture because employees might adjust in their style of working to meet the
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expectations of the new clients. Besides, troubles were found in internal operation such as
poor organization, low employee morale, and value discrepancies between organization

and staffs, which also are causes of change.

To sum up, there are the massive reasons for the change of culture in the organization, but
they are belong to two main groups: the change of external and internal environment.
They always change as a rule of nature, so organizational culture also shift to help
organization not be removed from the game.
How to Change organizational culture?

Figure 1. Kotter’s Eight – stepp Plan for Implementing change
(Source: Based on J.P.Kotter, Leading Change ( Boston, Harvard Business School Press,
1996)
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John Kotter of the Harvard Business school built a model for implementing change
((Stephen P. Robbins, Timothy A. Judge, 2011, Organizational behavior, Pearson
Education, Inc.,). I suppose that if change of organizational culture apply this model, it
will be successful.
1. Create a sense of urgency
By studying the transformation of external and internal environment, organization will
define opportunities & threats, strengths & weaknesses for conducting business. By doing
that, Organization also realize that its culture have to change for the new landscape.
2. Put together a strong enough team to direct the process
As the initiator of change, leaders who play an extremely important role in the process of
changing corporate culture. If want others to change, first of all themselves to change.
Leaders need to set an example in all acts, to make the other members to follow.
3. Create an appropriate vision
Organization develop a vision that is the ideal picture of the business in the future.

Oriented vision is to build corporate culture. Future organization may be different than it
is.
4. Communicate that vision broadly
It is necessary to construct statements about values and beliefs and organize small
discussion groups in each department to convey the mission, vision and values of the
organization into words and explain the impact of the statement on the work of each
employee. By doing this will help the staff have a common understanding of the cultural

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environment that organization want to build and the actions as well as behaviors that they
have to make to reflect the new cultural style.
5. Empower employees to act on the vision
- Remove all barriers.
- Encourage ideas, bold action, not traditional, to take risks.
6. Produce sufficient short-term results to give their efforts credibility and to
disempower the cynics
Organization have to inform all employees about the process of cultural change of the
organization in order to ensure their commitment and success of the process of cultural
transformation. Employees need to know what to expect from them is very important in
changing organizational culture. It is important to recognize and reward employees.
Enterprises may have to do this to encourage employees to adjust their behavior to fit a
new cultural environment.
7. Never Letting Up
Use increased credibility to change systems, structures, and policies that don't fit the
vision, also hire, promote, and develop employees who can implement the vision, and
finally reinvigorate the process with new projects, themes, and change agents.

8. Incorporating Changes into the Culture
Articulate the connections between the new behaviors and organizational success, and
develop the means to ensure leadership development and succession.
It is crucial to note that cultural change is not easy nor too difficult. It takes time, at least a
year, or about 3-6 years and requires effort and vigilance. A long-term support and
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patience is necessary. Proponents of change have to be an example of the behavior that
they want to see in others. If they do not convey a consistent message and keep the clear
message, cultural change can only be considered as a "model in the glass".
Cases of Viet Nam

In Vietnam, many enterprises have been successful thanks to good business culture and
most of them chose people as core in the process of building organizational culture.
Although born after many retail technology companies, but Mobile World is still able to
make the turnover better than competitiors. One of the advantages of this company is
recognized as professor and "culture". "Mobile World identify human resources is a key
factor to produce all the resources of the company. Therefore, we focus on attracting
talent, professional training and technology, adequate remuneration to build a powerful
force for sustainable development of the company, "said Dinh Anh Huan, Director
Business Mobile World said.
Truong Ngoc Phung, representing Company Mekong Capital Management, also share
relevant experience: "Before the Mekong Capital change culture, sales of Mekong Capital
often fail to achieve. The reason is that all members are arguing for the sake themselves,
almost always controversial meeting but did not solve anything. And company decide to
change the business culture, particularly change dialogue culture, people in company
started more friendly, all problems are shared, we created special for each one leadership

". Or twice a month, the company organize the competition in many areas, threads
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between departments, for the group interview employees who perform well on the job,
then do a book recounting successful people who how have successfuly adopted the
change of culture of the company.

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