1 chapter 10 leadership of culture, diversity, and the learning organization lussier, r. and achau,...

1

Chapter 10Chapter 10

Leadership of Culture, Leadership of Culture, Diversity, and the Diversity, and the

Learning OrganizationLearning Organization

Lussier, R. and Achau, C. (2007): Effective Leadership, 3rd Edition, South-Western, Cangage Learning

2

Summary of Lecture 21 & 22 Summary of Lecture 21 & 22

Role of leadership in strategic management processRelevance of internal and external environment Importance of a vision and mission statementRelationship between corporate objectives and strategiesImportance of strategy evaluationRisk Assessment ProcessCrises Leadership and ManagementCrises Leadership and ManagementNeed for ChangePhases of the change processMajor reasons for resisting changePeople and task-oriented techniques for overcoming resistanceto change


3

Learning Objectives

• The power of culture.• Distinguish between a weak and strong culture. Low and high performance cultures.• Symbolic and substantive leadership actions.• The four cultural value types.• Framework for understanding global cultural value

differences.• Primary reasons for embracing diversity.• Leader’s role in creating a diverse culture.• Leader’s role in creating learning organization.


4

Organizational Culture

Great culture is differentiating factors among low and high performance companies

High-performance companies have high-performance cultures

Strong corporate culture improve performance through consistent behavior

High performance corporate have people, structure, management system and culture

Culture is the source of competitive advantage


5

Culture

The set of key values, assumptions, understandings, and ways of thinking that is shared by members of an

organization and taught to new members


6

CULTUREEach organization has unique culture

Based on the values & principles displayed by leadersHas its own stories & mythsDetermines how to responds to threats & opportunities in both the external & internal environmentDeeply rooted (employees follow unconsciously) Core essence of organization How to approach problem and make decisions Organizational culture is enduring and can be said aswarming, friendly, open, innovative, conservative,aggressive, harsh etc


7

CULTURE

Power structure in organization

Procedure and criteria for allocating resources

Many components of culture are expressed in written from in policies, statements, philosophies

Often first expounded by founder

Wal-Mart Culture: Customer satisfaction, pursuit of low cost, strong work ethics

Wal-Mart: Executives visit to stores and Saturday morning meeting to exchange ideas


8

CULTURE & STRATEGYCulture must match with strategy and external environment For example: Product innovation and technological leadership need supportive culture of innovation, embracing change, risk taking and challenging status quo

Energized members to do their jobs

When out of syncReduces efficiency & effectiveness

When culture is well matched to strategyCan lead to successful organizationCreates internal unity (set of norms to guide behavior) Culture compatible behaviors are rewarded otherwise discouragedHelps organization to adapt to external environmentCreates strong member identification with the organization mission, goals and objectivesEnsures that organization respond to market changes and competitors moves quickly


9

CULTUREWeak: Little agreement on values & norms of member behaviorBecause leader did not communicate the vision

Lack of self identity

Manipulation, favoritism, intense internal competition

Autonomy promises but whereas reality is otherwise (lip service)

Strong: Clear, explicit set of principles & valuesUsed to conduct business, decision making and guide appropriate behaviors

Management communicates values & principles, continuously

Shared throughout organization

Does not significantly change when new leader is chosen

Strong culture is destructive if it is not adapted to environment and strategy

For example: IBM focus on strong bureaucratic and mainframes culture


10

FACTORS FOR STRONG CULTURE

1 Strong founder or leader develops principles, practices, & behavior for:

• Customers’ needs• Strategic requirement• Competitive environment

2 Total organizational commitmentTo operating under these values

3 Unwavering commitment from:Employees CustomersShareholderOther stakeholders


11

Characteristics of Low-Performance Cultures

Weak culture means low performance

1 Insular thinking (avoid to look outside for benchmark, relying too much on past success, more inward thinking fail to adapt to environment changes, top management unaware of employees needs pursuing their personal goals)

2 Resistance to change (maintain status quo, avoiding risk)

3 Politicized Internal Environment (influential managers operate their departments in their own way, self interest is above of corporate interests)

4 Unhealthy promotion practices (promoting employees without considering job demands and personality fit, promoting hard worker but lacks leadership skills, transactional skill-set managers expert in day to day routine operations promoted to job where transformational skills needed)


12

Characteristics of High-Performance Cultures

• Culture reinforcement tools (ceremonies, slogans, stories, language, and policies, ensures that employee and culture is compatible)

• Intensely people oriented treats employees with respect and dignityGive autonomyone to one relationship with high performersmentors programsincreased responsibility to best employees (job enrichment)celebrate employee achievementsHeld manager responsible for subordinate growthAllow to take initiatives to perform their jobClear and reasonable performance standards

• Results orientedEmphasis on achievement and excellence


13

Characteristics of High-Performance Cultures

• Results orientedEmployee who achieve standards are rewardedPerformance appraisal systemEmployee set goals with consultation of managers and held accountable At GE and 3M creative workers are supported and encouragedIn high performance culture who do not performs are fired or reassigned

• Emphasis on achievement and excellencemanagement follow policies that inspires to do their best


14

Leadership Actions for Shaping Culture

• Leadership responsibility to craft organizational culture

• Leader first identify which aspects of culture are supportive for strategy implementation and which are not?

• In second phase leader must communicate where change is required

• At third stage leader should take action• Implementation of new culture may need

modification in human resources areas, policies, and office design


15

Symbolic Leadership Actions for Shaping Culture

• Leaders serve as role models

• Ceremonial events for high achievers

• Special appearances by leaders (at meetings and trainings and parties)

• Organizational structure (it symbolizes culture, for example decentralized structure belief in individual initiatives and centralized culture reflect that leader knows every thing)


16

Substantive Leadership Actions for Shaping Culture

Replace members of old culture with new members•Change dysfunctional policies and practices•Reengineer strategy-culture fit (example of Mergers and Acquisition)

•Realign rewards/incentives, resources (rewarding performance consistent with strategy, reallocation of resources to new projects)

•Facilities design (common lunch area, no special parking areas, and similar office represent equality, office layout)

•Develop a written statementcode of ethics and values in written form

In mission statement

see Exhibit 10-4


17

Types of Organizational CultureDegree of Environmental Turbulence

Competitive Culture

Adaptive Culture

Bureaucratic Culture

Cooperative Culture

External

Internal

Stable Dynamic

Strategic

Focus

External

Static

Environment

Culture is not bad or good moreIn dynamic market best to follow market oriented culture


18

Discussion Question 1: What is culture?

Discussion Question 2: What are different types of culture?

Discussion Question 3: Define the role of leader in defining culture?

Discussion Questions


19

Summary

The power of culture

Distinguish between a weak and strong culture

Low and high performance cultures

Symbolic and substantive leadership actions

The four cultural value types.


1 chapter 10 leadership of culture, diversity, and the learning organization lussier, r. and achau,...

Documents