Corporate Culture: A Global Perspective Corporate Culture is… Influenced by national culture and 2. Sustained by corporate leadership

What is corporate culture? Corporate culture is a manifestation of the informally sanctioned corporate attitude. It is often referred to as “Organizational DNA” or the “Organizational Soul.” It is a fundamental contributor to the success or failure of corporate strategies.

Corporate Culture can evolve from… A leader’s vision, policies, and actions Influential individuals or work groups Policies & Procedures (Careless, lax, or unclear) People management philosophy (ignoring employee harassment) Employee work-ethic (hire for attitude; train for skill) Organizational policies (no gifts from suppliers, casual Fridays, etc.)

Corporate Culture is reflected in… A company’s Values, business principles, and ethical standards preached and practiced by management Approaches to people management and problem solving Relationships with Shareholders, community, customers, suppliers, government agencies, etc. Entrenched attitudes toward people from different “national” cultures

The First Step on the Path to Implementing a Successful Global Strategy… Understanding the Relationship between National Culture and Corporate Culture

Corporate Culture & National Culture Are Symbiotically Related

What is national culture? National culture is the mental programming of a group of people. It is comprised of the values, customs, and belief systems shared by a particular group of individuals. Dr. Geert Hofstede

Cultural Understanding can translate to better Business Practices Contributions of Geert Hofstede He separated cultures into five dimensions: Power Distance Individualism Uncertainty Avoidance Masculinity Short and long-term orientation

Business Ethics: It can be argued that some dimensions of business ethics are fluid. Cultural norms can differ between countries. What is unacceptable in one country may be perfectly acceptable in another. Thus… A healthy corporate culture will encourage employees to observe, learn, and avoid passing judgment too quickly.

Ethics The study of moral obligation involving the distinction between right and wrong. Business Ethics: right or wrong in the workplace – value management.

Introduction Ethics is the study of our web relationships with others. Companies do not operate in a vacuum but rather are plunged in a universe of relationships with multiple stakeholders. With the globalization the scenario in which companies operate has become even more complex, given the emergence of global groups of stakeholders.

Business Ethics Business Ethics means conducting all aspects of business and dealing with all stakeholders in an ethical manner…

Common Misconduct in Organizations Misrepresenting hours worked Employees lying to supervisors Management lying to employees, customers, vendors or the public Misuse of organizational assets Lying on reports/falsifying records Sexual harassment Stealing/theft Accepting or giving bribes or kickbacks Withholding needed information from employees, customers, vendors or public

Common Causes of Unethical Behavior Pressure Fear Greed Convenience

Effective strategic leaders -- Craft global strategies that nurture a healthy corporate culture Encourage employees to understand and appreciate other national cultures

Important qualities of strategic leaders Determination to nurture a healthy corporate culture Courage Self-confidence Integrity The capacity to deal with uncertainty and complexity A willingness to hold people (and themselves) accountable for their work

Cultural Core Concepts It’s not about Magic – It’s about Management Summary Cultural Core Concepts It’s not about Magic – It’s about Management

Corporate Culture… Management’s Responsibility Corporate culture refers to the character of a company’s internal work climate and personality. 2. In a strong-culture company, culturally-approved behaviors and ways of doing things are nurtured while culturally-disapproved behaviors and work practices are discouraged.

3. In adaptive cultures, there is a spirit of doing what is necessary to ensure long-term organizational success. 4. Adaptive cultures are exceptionally well suited to companies with fast-changing strategies and market. 5. The tighter the culture-strategy fit, the more the culture steers company personnel into displaying behaviors and adopting operating practices that lead to successful strategy execution.

6. It is in management’s best interest to dedicate considerable effort to building a corporate culture that encourages behaviors and work practices conducive to good strategy. 7. A company’s culture is grounded in and shaped by its core values and the bar it sets for ethical behavior. 8. A multinational company needs to build its corporate culture around values and operating practices that travel well across borders.

A relaxed culture…

Reputation management Reputation management is the understanding or influencing of an individual's or business's reputation. It was originally coined as a public relations term, but advancement in computing, the internet and social media made it primarily an issue of search results.

Cont.. . Some parts of reputation management are often associated with ethical grey areas, such as astroturfing review sites, censoring negative complaints or using SEO tactics to game the system and influence results.

Cont.. There are also ethical forms of reputation management, which are frequently used, such as responding to customer complaints, asking sites to take down incorrect information and using online feedback to influence product development

Definition How constituents perceive an organization The aggregate evaluation constituents make about how well an organization is meeting constituent expectations based on its past behaviors (Rindova & Fombrun, 1998; Wartick, 1992).

Evaluative Nature of Reputations Reputation is an evaluation constituents make about an organization’s performance. Different standards of evaluation create different reputations. PR natural fit to address constituent perceptions and evaluations.

Value of Reputation Reputation has proven value to corporations. Benefits of positive reputation include: Attracting customers Motivating employees Generating investment interest Increasing job satisfaction Garnering positive comments from financial analysts Generating positive news media coverage Attracting top employee talent Improving financial performance

Reputation management process1

EMPLOYMENT RELATIONSHIP Building successful employment relationships is important. It also makes good business sense: organisations with good employment relationships tend to be more successful.

CONT.. Good employment relationships begin with a good recruitment process that ensures everyone has clear expectations about the role, working conditions and employment rights. A clearly written employment agreement can help reduce the risk of misunderstandings

Who is an employee? An employee is anyone who has agreed to be employed, under a contract of service, to work for some form of payment. This can include wages, salary, commission and piece rates.

Affirmative action (AA) Affirmative action or positive discrimination (known as employment equity in Canada, reservation in India, and positive action in the UK) is the policy of providing special opportunities for, and favouring members of, one group over another, when those being favoured are perceived as a disadvantaged group who suffer from discrimination within a culture.

CONT.. The nature of positive discrimination policies varies from region to region. Some countries, such as India, use a quota system, whereby a certain percentage of jobs or school vacancies must be set aside for members of a certain group. In some other regions, specific quotas do not exist; instead, members of minorities are given preference in selection processes

Side Effect of AA Can be deemed discriminatory It disadvantages those in advantaged positions. It is acceptable in some countries to “tip the scales” in favor of the underrepresented. if candidates are equal on all other criteria What is your opinion on “tipping the scales” to favor underrepresented groups?

Quotas Quotas specify that a proportion of a minority group must be selected for an interview or job. regardless if they are less qualified reverse discrimination Reverse Discrimination Justification for reverse discrimination is somewhat ambiguous. based on retributive justice (past injustices must be paid for) Example: women discriminated against for a long time time to reverse the trend consequently they deserve preferential treatment

A code of conduct is a set of rules outlining the responsibilities of, or proper practices for, an individual, party or organization. Related concepts include ethical, honor and moral codes, as well as halachic and religious laws.

CONT… A common code of conduct is written for employees of a company, which protects the business and informs the employees of the company's expectations. It is ideal for even the smallest of companies to form a document containing important information on expectations for employees. The document does not need to be complex or have elaborate policies, but the file needs a simple basis of what the company expects from each employee.

ETHICS AUDIT An investigation into how well (or poorly) a company conforms to the ethical standards of its industry or society generally.  An ethics audit may consider the company's own practices, how it redresses grievances, how it discloses its finances, whether it punishes whistleblowers, and even the general cultural surrounding its business dealings.  Some companies may formally adopt a code of ethics and conduct periodic ethics audits to see how closely they follow their own rules.

CONTT.. The reasons for examining the state of a company's ethics are many and various. They include external societal pressures, risk management, stakeholder obligations, and identifying a baseline to measure future improvements. In some cases, companies are driven to it by a gross failure in ethics, which may have resulted in costly legal action or stricter government regulation. More often, however, companies choose to do it simply because it is right, it is important, and because it is likely to bring business benefits.

CONTT.. The findings of the audit give a snapshot, a view at a particular point in time, of the company's ethics. In the case of a first audit, they will necessarily be of less value for comparison purposes than would future audits, but they ought to give a clear picture of both values and vulnerabilities. An audit report is a factual document.