Corporate  Culture  and  Leadership
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Corporate Culture and Leadership. Screen graphics created by: Jana F. Kuzmicki, Ph.D. Troy University-Florida Region . Defining Characteristics of Corporate Culture. Core values, beliefs, and business principles Ethical standards

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Corporate Culture and Leadership

Screen graphics created by:

Jana F. Kuzmicki, Ph.D.

Troy University-Florida Region

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Defining Characteristics of Corporate Culture

  • Core values, beliefs, and business principles

  • Ethical standards

  • Operating practices and behaviors defining“how we do things around here”

  • Approach to people management

  • “Chemistry” and “personality” permeatingwork environment

  • Oft-told stories illustrating

    • Company’s values

    • Business practices

    • Traditions

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Identifying the Key Featuresof Corporate Culture

A company’s culture is manifested in . . .

  • Values, business principles, and ethical standards preached and practiced by management

  • Approaches to people management and problem solving

  • Official policies and procedures

  • Spirit and character permeating work environment

  • Interactions and relationships among managers and employees

  • Peer pressures that exist to display core values

  • Its revered traditions and oft-repeated stories

  • Its relationships with external stakeholders

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Where Does CorporateCulture Come From?

  • Founder or early leader

  • Influential individual or work group

  • Policies, vision, or strategies

  • Operating approaches

  • Company’s approach to people management

    • Traditions, supervisory practices, employee attitudes

  • Organizational politics

  • Relationships with stakeholders

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Strong vs. Weak Cultures

Unhealthy Cultures

High-Performance Cultures

Adaptive Cultures

Types of Corporate Cultures

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Characteristics ofStrong Culture Companies

  • Conduct business according to a clear, widely-understood philosophy

  • Considerable time spent by management communicating and reinforcing values

  • Values are widely shared and deeply rooted

  • Have a well-defined corporate character,reinforced by a creed or values statement

  • Careful screening/selection of newemployees to be sure they will “fit in”

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Characteristics of Weak Culture Companies

  • Lack of a widely-shared core set of values

  • Few behavioral norms evident in operating practices

  • Few strong traditions

  • No strong sense of company identity

  • Little cohesion among departments

  • Weak employee allegiance tocompany’s vision and strategy

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Characteristics of Unhealthy Cultures

  • Highly politicized internal environment

    • Issues resolved on basis of political clout

  • Hostility to change

    • Avoid risks and don’t screw up

    • Experimentation and efforts toalter status quo discouraged

  • “Not-invented-here” mindset – company personnel discount need to look outside for

    • Best practices

    • New or better managerial approaches

    • Innovative ideas

  • Disregard for high ethical standards and overzealous pursuit of wealth by key executives

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Characteristics ofHigh-Performance Cultures

  • Standout cultural traits include

    • A can-do spirit

    • Pride in doing things right

    • No-excuses accountability

    • A results-oriented work climate in which people go the extra mile to achieve performance targets

  • Strong sense of involvement by all employees

  • Emphasis on individual initiative and creativity

  • Performance expectations are clearly identified for all organizational members

  • Strong bias for being proactive, not reactive

  • Respect for the contributions of all employees

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Hallmarks of Adaptive Cultures

  • Willingness to accept change and embrace challenge of introducing new strategies

  • Risk-taking, experimentation, and innovation to satisfy stakeholders

  • Entrepreneurship is encouraged and rewarded

  • Funds provided for new products

  • New ideas openly evaluated

  • Genuine interest in well-being of all key constituencies

  • Proactive approaches toimplement workable solutions

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Culture: Ally or Obstacleto Strategy Execution?

  • A company’s culture can contribute to – or hinder – successful strategy execution

  • A culture that promotes attitudes and behaviors that are well-suited to first-rate strategy execution is a valuable ally in the strategy execution process

  • A culture where attitudesand behaviors impedegood strategy execution is ahuge obstacle to be overcome

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Our ethics


consists of . . .

Grounding the Culture inCore Values and Ethics

  • A culture based on ethical principles isvital to long-term strategic success

  • Ethics programs help make ethical conduct a way of life

  • Executives must provide genuine supportof personnel displaying ethical standardsin conducting the company’s business

  • Value statements serve as acornerstone for culture-building

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Fig. 13.2: The Two Culture-Building Roles of aCompany’s Core Values and Ethical Standards

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Fig. 13.3: The Benefits of Cultural Norms StronglyGrounded in Core Values and Ethical Principles

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Establishing a Strategy-Culture Fit in Multinational and Global Companies

  • Institute training programs to

    • Communicate the meaning of core values and

    • Explain the case for common operatingprinciples and practices

  • Create a cultural climate where the norm is to

    • Adopt best practices

    • Use common work procedures

    • Pursue operating excellence

  • Give local managers

    • Flexibility to modify people managementapproaches or operating styles

    • Discretion to use different motivational and compensation incentives to induce personnel to practice desired behaviors

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Role #1: Stay on Top of What’s Happening and Global Companies

  • Develop a broad network of formaland informal sources of information

  • Talk with many people at all levels

  • Be an avid practitioner of MBWA

    • Observe situation firsthand

  • Monitor operating results regularly

  • Get feedback from customers

  • Watch competitive reactions of rivals

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Role #2: Put Constructive Pressure on and Global CompaniesCompany to Achieve Good Results

  • Successful leaders spend time

    • Mobilizing organizational energy behind

      • Good strategy execution and

      • Operating excellence

    • Nurturing a results-oriented work climate

    • Promoting certain enabling cultural drivers

      • Strong sense of involvement on part of company personnel

      • Emphasis on individual initiative and creativity

      • Respect for contributions of individuals and groups

      • Pride in doing things right

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Role #3: Promote Stronger Core and Global CompaniesCompetencies and Capabilities

  • Top management intervention isrequired to establish better or new

    • Resource strengths and competencies

    • Competitive capabilities

  • Senior managers must lead the effort because

    • Competencies reside in combinedefforts of different work groups and departments, thus requiring cross-functional collaboration

    • Stronger competencies and capabilitiescan lead to a competitive edge over rivals

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Our ethics and Global Companies

code is . . .

Role #4: Display Ethics Leadership and Lead Social Responsibility Initiatives

  • Set an excellent example in

    • Displaying ethical behaviors

    • Demonstrating character andpersonal integrity in actions and decisions

  • Declare support of company’s ethics codeand expect all employees to conductthemselves in an ethical fashion

  • Encourage compliance and establish toughconsequences for unethical behavior

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Role #5: Lead the Process of and Global CompaniesMaking Corrective Adjustments

  • Requires deciding

    • When adjustments are needed

    • What adjustments to make

  • Involves

    • Adjusting long-term direction, objectives, and strategy on an as-needed basis in response to unfolding events and changing circumstances

    • Promoting fresh initiatives to bring internal activities and behavior into better alignment with strategy

    • Making changes to pick up the pace when results fall short of performance targets