Chapter 3 part 2

Task Environment Customers Competitors Suppliers Labor Market

Customers-People and organizations that acquire goods or services from the organization. Competitors are organizations within the same industry or type of business that compete for the same set of customers.

Suppliers provide the raw materials which the organization uses to produce its output. Labor Market represents the people available for hire by the organization.

Organization-Environment Relationship The environment creates uncertainty for managers. Environmental uncertainty: means that managers do not have sufficient information about environmental factors to understand and predict environmental needs and changes. Eg:Increasing Competition, Govt rules, etc. Managers must respond and design adaptive organizations Uncertainty can be managed through effectiveness –degree to which organization achieves a stated goal.

3.4 External Environment and Uncertainty Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

Adapting to the Environment 1. Boundary-spanning roles – link and coordinate the organization with external environment. Identify and process information about changes……….solve problems a)Business Intelligence (BI): software to search data to identify….. b) Competitive intelligence (CI):relates to activities to get information (use websites, commercial data base, market activities) 2.Inter-organizational partnerships – reduce boundaries and begin collaborating with other organizations. Instead of working alone they join together…………. Eg;batteries and computer chip. A & B = AB 3. Mergers/joint ventures – legal combination of operations; legal collaboration for specific costly project A + B = C Hero-Honda BBME, HSBC, OIB

The Internal Environment: Corporate Culture Corporate culture is the set of key values, beliefs, understandings, and norms that members of an organization share. “How we do things around here or the way things are here” Family Bs Corporate=shared values by all the members. Visible Symbols: Stories: Heroes Slogans Ceremonies

Strategic Management-Concepts & Cases,Fred R David,12th edtn Symbols: a fast car is a symbol of power, strength. Moon ring, Christian cross Stories: description of true events. They paint pictures symbolizing firms’ vision, values, etc. Heroes: role models of strong culture, Slogans: sentence showing a key corporate value. “faster than light” for a new car. Ceremonies: a planned activity for a special event to honor heroes, etc. Strategic Management-Concepts & Cases,Fred R David,12th edtn

Strategic Management-Concepts & Cases,Fred R David,12th edtn Meaning of terms Define: Object, Act, or event that conveys meaning to others is called symbol. Narrative based on true events is story. Figure who exemplifies the deed, character, attributes of a strong culture is Hero. Sayings to convey special meaning is Slogan. Special event for the benefit of the audience is Ceremony. Strategic Management-Concepts & Cases,Fred R David,12th edtn

3.6 Levels of Corporate Culture Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

Strategic Management-Concepts & Cases,Fred R David,12th edtn When employees are basically lazy, they avoid working. Therefor, closely supervised and given little freedom. Strategic Management-Concepts & Cases,Fred R David,12th edtn

Four Types of Corporate Cultures Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

The Internal Environment: Corporate Culture Corporate culture plays a key role in learning and innovate responses Successful companies balance culture and performance Culture is the “glue” that holds the organization together

Cultural Leadership Articulate (express ideas clearly) a vision for the organizational culture that employees can believe in Heeds the day-to-day activities that reinforce the cultural vision Leaders communicate through words and actions.