Business Strategy


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Pages : 323; Paperback;
210 X 275 mm approx.

Pages : 321; Paperback;
210 X 275 mm approx


Textbook Price: Rs. 750 ;
Workbook Price: Rs. 700;
Available only in INDIA

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Business Strategy Textbook | Workbook

Detail Table of Contents

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<< Chapter 11

Strategy Execution and Organizational Culture : Chapter 12

SUMMARY: The purpose of organizational culture is to enable internal integration and external adaptation. Values are basic assumptions about which ideals are desirable or worth striving for. Values and beliefs have more personal meaning if an individual complies with the set of values as a guide to appropriate behavior in the organization. When such beliefs and values are shared across the organization, they constitute a meaningful value system of an organization.

A combination of prior assumptions and new learning experiences determines the contents of a culture. For successful execution of strategy, leaders typically attempt to manage and create a distinct culture within their organizations through a variety of ways. Some common methods for this institutionalization are: emphasize key themes or dominant values; encourage

dissemination of stories and legends about core values; institutionalize practices that systematically reinforce desired beliefs and values; and adopt very common themes in unique ways. Cultural diversity, both domestically and internationally, is something that most managers will experience due to differing backgrounds. Organizational culture must recognize cultural diversity – the reality of present global organizations.

All forms of organization structures are not equally effective in the implementation of a strategy due to many cultural differences. Organizational growth and diversification necessitate simultaneous changes in structure and culture. However, in practice, lagging performance may be necessary before culturally politicized sensitive structure is changed or organizational power redistributed. Organizational culture is the product of the style of leadership/management. First, organizational culture is created by the strategic leadership provided by an organization’s founder and top managers. Second, the leadership style established by the founder is transmitted to the organization’s managers, and as the organization grows, it typically attracts new managers and employees who share the same values.

The sources of power can be divided into two broad categories -- internal sources and sources for external stakeholders. The important internal sources of power include hierarchy; influence / charisma; control of strategic resources; expertise / knowledge / skill; control over the environment; and the exercise of discretion. The important external sources of power include resource dependence, involvement in implementation, expertise, and internal links. It is quite difficult to accurately assess the power of internal individuals or groups and external stakeholders. However, a good way of assessing power is to depend on indicators of power.

Two distinct cultural settings, namely adaptive cultures and inert cultures, are observed in many organizations. Adaptive cultures are those that are innovative and encourage and reward initiative-taking by middle and lower level managers. On the other hand, inert cultures are those that are cautious and conservative, that do not value middle and lower level managers taking such action, and may actively discourage such behavior. In an organization, an inert culture may lead to the failure of strategic management.

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