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Chapter 10

Chapter 10. Developing an Entrepreneurial Culture. Introduction. A simple way to think about culture is that it captures the personality of the company and what it stands for . Entrepreneurship is not only affected by the culture in a company, it is also a core element of the culture.

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Chapter 10

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  1. Chapter 10 Developing an Entrepreneurial Culture

  2. Introduction A simple way to think about culture is that it captures the personality of the company and what it stands for. Entrepreneurship is not only affected by the culture in a company, it is also a core element of the culture.

  3. Question 1: What is an organizational culture?

  4. The Nature of Culture in Organizations Culture can be defined as “an organization’s basic beliefs and assumptions about what the company is about, how its members should behave, and how it defines itself in relation to its external environment” A culture reflects the unique history of a group of people interacting over time, but it also is subject to continuous change as people come and go, and is based on developments in the external environment.

  5. The Nature of Culture in Organizations • Finally, cultures are fuzzy. They include elements that may seem contradictory or paradoxical. • Cultures tend to differ along some key dimensions: • Positive vs. negative • Strong or weak • Homogeneous or heterogeneous • Consistent or inconsistent

  6. Question 2: What are the six (6) elements of culture? Briefly describe each.

  7. The Pieces and Parts of Culture Values—things employees think are worth having or doing; intrinsically desirable Rules of conduct—accepted norms and rules of the company Vocabulary—the language, acronyms, jargon, slang, signs, slogans, songs, etc. Methodology—perception of how things actually get done in the company Rituals—rites, ceremonies, and taboos (e.g., recognition ceremonies, retreats, etc.) Myths and stories—the history, sagas, myths, and legends of the organization

  8. The Pieces and Parts of Culture Cultures consist of substance and forms. Substancerefers to shared systems of values, beliefs, and norms. Forms are the concrete ways in which the substance is manifested in the organization.

  9. The Pieces and Parts of Culture “Organizational cultures can enhance and inspire us. They can remove us from the boxes and traps in which we exist, making our lives richer and giving meaning to our daily tasks. [This] is the goal of cultural management.”

  10. Core Ideology and the Envisioned Future Core ideology includes core values, or what the company stands for, as well as core purpose, or the reason the company exists. Google created a Chief Culture Officer (COO) to ensure a culture of ideas and creativity. At Disney, creativity, dreams, and imagination form some of the core values.

  11. Question 4: What are eight (8) elements of an entrepreneurial culture? How might each contribute to firm entrepreneurship?

  12. Elements of an Entrepreneurial Culture People and empowerment focused Value creation through innovation and change Attention to the basics Hands-on management Doing the right thing Freedom to grow and to fail Commitment and personal responsibility Emphasis on the future and a sense of urgency

  13. Question 5: What are the differences between individualism and collectivism?

  14. Exploring a Key Value: Individualism Individualism – a self-orientation, an emphasis on self-sufficiency and control, the pursuit of individual goals that may or may not be consistent with those of the employee’s colleagues. Collectivism– the subordination of personal interests to the goals of the larger work group.

  15. Merits of Individualism vs. Collectivism (Table 10.3) Positive Aspects Negative Aspects

  16. Question 6: How do firms balance individualism and collectivism to promote entrepreneurship?

  17. The ability to achieve sustained entrepreneurship in a company is dependent upon a balance between the need for individual initiative and the spirit of cooperation and group ownership of innovation.

  18. High EntrepreneurialIntensity Low Strong individualorientation Strong group orcollective org. Ideal balance

  19. A Different View of Failure Managers struggle with the concept of failure • There is a tendency within companies to develop “zero error cultures” as companies strive to meet ever-higher performance standards in a hypercompetitive marketplace • This results in innovation incompetence, where bold initiatives are avoided and initiatives are pursued only when there is an apparent guarantee of outcomes

  20. A Different View of Failure The culture in the entrepreneurial firm celebrates failure. • Fear of failure is a certain recipe for mediocrity. • Failure is perceived– employees attach certain costs to it • Is it job loss, a smaller pay raise, a missed promotion, a blemished record, loss of autonomy, personal embarrassment, loss of stature, or something else?

  21. Question 7: How does leadership interact with culture to encourage entrepreneurship?

  22. Leadership and Culture • An entrepreneurial leader and an entrepreneurial culture are not completely synonymous • If leader leaves without ENT culture in place, so does the ENT culture • ENT leaders help to encourage and facilitate an ENT culture • Remember, this is a slow process

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