Human Resources

Managing Organisational Culture

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The values and behaviors that contribute to the unique social and psychological environment of an organization make up the organizations culture. Organizational culture is the summation total of an organization’s past and current suppositions, incidents, viewpoint, and values that hold it together, and is articulated in its self-image, inner workings, connections with the outside world, and future prospects.

In dealing with the management of organisational culture, it is firstly essential to recognize as fully as possible the characteristics of the existing or new target culture to include the myths, symbols, rituals, values and assumptions that strengthen the culture. Organisational culture is not something that can be viewed very easily it is consequently quite hard to replace it. Usually when certain leaders form a company, their values are converted into the actions of the members of that organisation. When other leaders take over, it may not be as easy to alter those perspectives right away. Sometimes some of their actions; like rewards may transform the ways workers go about their day-to-day activities but it may be hard to change their culture.

Companies that wish to manage cultures should encourage participation of other members of the organisation in the development activities, decision making and input to the organisation. This will make the workers feel as though they are valuable members of the organisation and they will be motivated to work harder. Lastly, the company should go out of its way to facilitate better communication between members of the organisation. This can be achieved through teamwork integration. It will go a long way in maintaining systems that help the company to stay ahead of its competitors.

Aims – Objectives

The purpose of this paper is to define culture management is and its conceptual underpinnings and then look to see how cultural management is important to the successes of a company. The different approaches to implementing culture management in practice will be looked at and practical ways of implementing culture management will also be discussed. Strategies for using HRM to improve company culture will be discussed in the UK, China and India in order to determine how HRM can be used to make the transition from doing business in the UK to doing business in China and India.

Table of Contents

Executive Summary

Aims – Objectives


Literature Review

Culture as a Broad Concept

Managing Organizational Culture

Organizational Culture in the UK

Managing Organizational Culture in the UK

Organizational Culture in China

Managing Organizational Culture in China

Organizational Culture in India

Managing Organizational Culture in India

Cultural Comparisons

19 UK and India

20 UK and China

Analysis and Discussion

How to Improve Corporate Culture

Theories of Culture

Edgar Schein Theory

Hofstede’s Theory

Charles Handy’s Culture Theory

Trompenaars’s Culture Theory

Cultural Relativism

How to Improve Corporate Culture in the UK

How to Improve Corporate Culture in China

How to improve Corporate Culture in India





Organizational culture is the workplace environment formulated from the association of the workers in the workplace. “Organizational culture is defined by all of the life experiences, strengths, weaknesses, education, upbringing, and so forth of the employees” (Organizational Culture: Corporate Culture in Organizations, 2012). While executive leaders play a large role in defining organizational culture by their actions and leadership, all employees contribute to the organizational culture. The values and behaviors that contribute to the unique social and psychological environment of an organization make up the organizations culture. Organizational culture is the summation total of an organization’s past and current suppositions, incidents, viewpoint, and values that hold it together, and is articulated in its self-image, inner workings, connections with the outside world, and future prospects (Organizational Culture, 2012).

It is founded on collective attitudes, beliefs, and customs, express or implied contracts, and written and unwritten rules that the organization expands over time and that have worked well enough to be considered valid. Also called corporate culture, it manifests in the ways the organization performs its business, treats its workers, customers, and the wider society, the degree to which autonomy and freedom is permitted in decision making, developing new ideas, and personal appearance, how authority and information flow through its hierarchy, and the strength of worker commitment towards collective objectives. It is phrased strong or weak to the extent it is diffused throughout the organization. It affects the organization’s output and performance, and provides strategies on customer care and service; product excellence and security; attendance and promptness; and concern for the environment. It expands also to production-methods, marketing and advertising practices, and to new product formation. While there are many common elements in the large organizations of any country, organizational culture is unique for every organization and one of the hardest things to change (Organizational Culture, 2012).

Although every company and its corporate culture are individual, three important components present in successful management. First, the vision, mission and value definitions of the company owner are clear and concise, permitting workers to better comprehend the focus of the business. Second, workers understand their expected contributions to attain company goals and objectives, based on the leader’s mission. Finally, employees should adopt attitudes that support and focus on the company’s goals and strategies (Pirraglia, 2012).

Edgar H. Schein developed a model to clarify the basic fundamentals of cultures. Edgar Schein’s model looks like the functionalistic models put forward by cultural theorists such as Geert Hofstede and Fons Trompenaars, and can be used to examine all kinds of cultures including corporate and national cultures. The models put forward all suppose that cultures can be clarified and understood by looking at the core principles and suppositions of a given culture (Edgar H. Schein’s Model of Organizational Culture, 2010).

This report will look at the relevant literature that exists in regards to organizational culture and how it can be managed via human resource management in the Literature Review section. Organizational culture will be looked at in respect to the UK, China and India. An analysis and discussion on how to improve corporate culture will follow the literature review. Major theories of culture will then be discussed followed by a conclusion and recommendations.

Literature Review

Culture as a Broad Concept

In its very broadest sense, culture serves to outline different groupings of people on the foundation of the extent to which each group is professed and perceives itself to divide similar ways of seeing and interrelating with the animate, inanimate and spiritual world. Cultures are based in history, developing over time as groups establish patterns of behaviour and belief that seem effective in helping them to interpret and interact with the world in which they find themselves. In addition to providing implicit guidelines for behaviour and the channelling of emotion, cultures serve to give people a sense of belonging through collective identity and thus break down the inherent segregation of the individual. It is also significant to comprehend that culture can also define differences amid groups. Culture identifies exacting groups by their resemblances as well as their differences. Even though cultures are self-motivated to the degree that altered circumstances can lead to the amalgamation of new patterns of behaviour or ideologies, characteristically these are overlaid on existing middle assumptions and therefore a culture may exhibit what seem to be multifaceted uncertainties or inconsistencies until such time new behavioural alterations to the environment give rise to a new belief system and set of core assumptions. This can be clearly seen in the case of egalitarianism, a value that is probably associated with a core assumption that life should be lived cooperatively, rather than competitively and commercialisation of labour, they also now show eagerness for job or salary-related status which tends to be linked with spirited behaviour. It may be that over time, as behaviours and values move towards competitiveness, deeply held suppositions about the feasibility of supportive relationships will also shift to highlight the superior viability of competitive associations (Organizational Culture and Performance, n.d.).

Managing Organizational Culture

In dealing with the management of organisational culture, it is firstly essential to recognize as fully as possible the characteristics of the existing or new target culture to include the myths, symbols, rituals, values and assumptions that strengthen the culture. Subsequently, action can be instigated in any of several key points of leverage:

recruitment, selection and replacement — culture management can be affected by ensuring that appointments strengthen the existing culture/s or support a culture shift; removal and replacement may be used to dramatically change the culture;

socialisation — induction and subsequent development and training can provide for acculturation to an existing or new culture and also for improved interpersonal communication and teamwork, which is especially critical in fragmented organisational cultures;

performance management/reward systems — can be used to highlight and encourage desired behaviours which may or may not in turn lead to changed values;

leadership and modelling — by executives, managers, supervisors can reinforce or assist in the overturning of existing myths, symbols, behaviour and values, and demonstrates the universality and integrity of vision, mission or value statements;

participation — of all organisation members in cultural reconstruction or maintenance activities and associated input, decision-making and development activities is essential if long-term change in values, and not just behaviours, is to be achieved;

interpersonal communication — satisfying interpersonal relationships do much to support an existing organisational culture and integrate members into a culture; effective teamwork supports either change or development in and communication of culture; and structures, policies, procedures and allocation of resources — need to be congruent with organisational strategy and culture and objectives (Willcoxson & Millett, n.d).

Understanding of organisational culture and cultural types also helps the understanding of why managerial reforms may impact differently within and between organisations. An organisation with a predominantly internal process culture, for example, may be more resistant to reforms aimed at promoting innovation. It is expected that staff in high uncertainty avoidance cultures to be more concerned with rule-following and more reluctant to risk changing jobs – both factors of some importance for those reformers who want to deregulate bureaucracies and encourage more rapid job change in the public service’. Businesses in both the private and public sectors have come to understand that organisational change frequently requires changing the organisation’s culture and learning (O’Donnell & Boyle, 2008).

Whatever the purpose and performance results of culture management efforts, models of culture alteration focus on either ordinary evolution or required revolution. The most recognized evolutionary approach is the framework of Sathe (1983). This approach centres on the basis that as new organizational members are socialized, they are infiltrated with the organization’s culture, which is further reinforced as lively interaction takes place. Therefore, through focusing on how culture evolves, Sathe (1983) argues that culture intervention efforts should center on the means by which culture is perpetuated, for instance during socialization processes and rituals. In spite of general accord that cultural evolution takes place, promoted approaches to culture interventions are more normally revolutionary in nature (Harris & Ogbonna, 2002).

Frameworks and models of culture change, in part, reflect the range of perspectives on culture change. A review of the literature finds that there are three broad perspectives through which the issue of culture management has been discussed. The first category of studies consists of those writers who adopt the view that culture is an organizational variable, which, akin to other variables, is subject to direct management control. This perspective is illustrated by the work of many functionalists. In addition, this view of culture management is obvious in the arguments of early culture theorists who supported the professed links between sturdy cultural traits and organizational performance (Harris & Ogbonna, 2002).

Organizational Culture in the UK

Successful organisations are characterised by strong values and a strong guiding view that communicates what behaviour is suitable and what is not. If these values are broadly shared across the organisation and are reflected in the everyday behaviors of workers at all levels, both individually and collectively, then there is a strong culture. Evidence has shown that organisational success is dependent on having the right mix of HR policies in place. “The ability, motivation and opportunity (AMO) model supports the theory that business success is based on the capacity of organisations:

to recruit people with the right ability to motivate them to provide them with the opportunities to use their skills in well-designed jobs” (Vision and values: organisational culture and values as a source of competitive advantage, 2012).

Research also discovered that it’s significant for organisations to generate the kind of environment or culture where the positive managerial actions of listening, coaching, guiding, involving and problem-solving are actively supported and reinforced. This is where HR policy is vital as it reflects and reinforces organisational values and culture. A lot of the companies looked at focused on a few key words that simply convey what the purpose or values of the organisation are how the organisation works and what it’s like to work there. In order to construct commitment and drive improved performance it needs to be:

embedded and understood across the organisation integrated into relationships between stakeholders

enduring, built around or on a legacy of past success habitual, with behaviours repeated, collective and routine (Vision and values:

organisational culture and values as a source of competitive advantage, 2012).

“The research also clearly shows a link amid between strong shared values and high commitment. Where strongly shared values can be demonstrated, people are more likely to be satisfied, displaying higher levels of organisational commitment, lower quit rates, greater customer satisfaction, and lower levels of dissent or dissatisfaction over levels of pay” (Vision and values: Organisational culture and values as a source of competitive advantage, 2012).

Managing Organizational Culture in the UK

While incremental advances in new product introduction appear to be reliant on conventional management structures and processes in the UK, radical innovation can command an organizational reaction that reaches beyond the ready-state approach to managing innovation. Fundamental innovation is high-risk and high-return, and consequently does not react well to the management practices applied to incremental innovation activities. Even though there are a lot of dimensions that pressure both incremental and radical innovation, for instance, national systems, knowledge flows and labour markets, it is normally agreed that organizational culture is an important influence on the inclination of an organization towards innovation. While there is difference about how to best systematize for radical innovation, most managers agree that radical innovation is perpetually a perplexed, uncertain process when compared to incremental improvement. The innovative driving force for innovation is technological or the personal inquisitiveness of individuals, rather than market led and for most operating businesses, it is an unnatural act because the indecision is too high, the time horizon too long, and the investment too large, given the risks. Organizing for irregular innovation, particularly in the highly uncertain front end of the process, is frequently separated from ongoing business activities (McLaughlin, Bessant & Smart, n.d).

Different kinds of innovation necessitate different kinds of organizational hardware structures, systems and rewards and dissimilar kinds of software- human resources, networks and culture. Throughout periods of incremental change organizations can rely on units with relatively formalized roles and responsibilities, centralized procedures, functional structures, efficiency-oriented cultures, strong manufacturing and sales capabilities and relatively homogeneous, older and experienced human resources. These units are characterized by a high degree of inertia, emphasizing efficiency, teamwork and continuous improvement. During periods of discontinuous innovation, organizations require entrepreneurial types of units. These units are comparatively small, have loose decentralized product arrangements, untried cultures, strong capitalist and technical competencies and fairly young and heterogeneous workers. They build new knowledge bases and information systems. Incremental innovation typically highlights cost or feature developments in existing products or services mainly depend on development competencies. “In contrast radical innovation concerns the development of new business or product lines, based on new ideas or technologies or substantial cost reductions that transform the economics of a business and require exploration competencies” (McLaughlin, Bessant & Smart, n.d).

The heightened significance given to effective people management places HRM at the center of the organization’s business strategy, making it extremely attractive to business owners as well as to line managers, whose role was also improved because of the active stance they are necessary to play in the achievement of HR policies. Another attractive characteristic is the supposition of a fundamentally harmonious association between workers and their managers where both parties are professed as working towards the same goal of organizational accomplishment. This was in marked contrast to traditional people management approaches in the UK, where workplace conflicts between management and trade unions were seen as an inevitable and frequently occurring part of the employment relationship (Human Resource Management in Context, n.d.).

This vision of HRM distinguishes that stakeholder interests are more likely to be achieved if HR policy choices and results ensure worker well-being. Its flexibility with regard to stakeholder interests made the model easier to export beyond the U.S.A., since it recognizes key areas of difference across national boundaries. It positively proved to be the more popular approach in the UK, despite criticism from some academics for its preference for the unitarist view which is an outlook on people management that highlights harmonious relationships between managers and employees and an acceptance of organizational objectives over the pluralist view of the workplace, which sees conflict as inevitable. But it should be noted that neither model pays much attention to the realities of work inside the organization or to the contested, contradictory, and fragmented nature of the employment relationship between employer and employee (Human Resource Management in Context, n.d.).

Organizational Culture in China

At the beginning of the 21st century, the People’s Republic of China finds itself in the middle of social, financial and cultural transition, some might even say chaos. The old assurances, which epitomised the iron-tight grip of the Communist Party during the reign of Mao Zedong, have long since been replaced by the more liberal but uncertain policies instituted by Mao’s great transformational successor, Deng Xiaoping and continued by succeeding regimes. The pursuit of income is no longer counter-revolutionary and business people have long since stopped being viewed as enemies of the people. “Yet the Communist Party is still in power and shows little appetite for any of the political reform so much clamoured for by the West” (Background to Business in China, n.d).

In China, management style tends towards the order, with the senior manager giving instructions to their direct reports who in turn pass on the orders down the line. It is not anticipated that subordinates will question the choices of superiors because that would be a showing of disrespect and be the direct cause of loss of face for everyone concerned. The manager should be seen as a kind of father figure who anticipates and receives devotion and compliance from colleagues. In return, the manager is anticipated to take a holistic interest in the well-being of those colleagues. It is an equally beneficial two-way association (Background to Business in China, n.d).

Senior managers will frequently have close associations to the Communist Party and a lot of business decisions are likely to be examined by the party which is frequently the hidden force behind a lot of situations. It is frequently said that China has a lack of good-quality, knowledgeable managers, which is typical of a quickly growing and modernising economy, and that the good managers who are accessible are very expensive. This places massive importance on any company’s staffing and retention policies as one has to able to recruit the best and then keep them (Background to Business in China, n.d).

Managing Organizational Culture in China

China is seen as a low-cost products output country, The Chinese industry is mainly constituted by labor intensive work, and domestic corporations lack high technological products and experiences of management in multiple culture situations. In the past, Chinese corporations had a safety economic environment to operate their business because of the trade protectionism, but in pace with Chinese economic reform and opening-up, and China became as an element of global economic, the most of Chinese corporations found that their business plan did not work well any more. The technology levels of China’s industries and enterprises have been rising, but compared with the highly developed countries, the innovation capacity of Chinese firms is still feeble. So, how to adjust to the challenge of global situation and business competition became a serious trouble to Chinese corporations. Basically, the competition requires these corporations be more innovative, respond to the change more quickly. In order to generate and maintain competitive advantage, it is not enough just only to focus on products or process development, learning and understanding the corporate culture, monitoring and managing it on operation practice is crucial factor to get success. Chinese culture has typical characteristics, and these culture impact the Chinese corporation a lot. “The corporations which got succeed in the market competition were those dealing the innovation perfectly with their culture” (Tu & Yuan, 2010).

Previous to the economic reform, state-owned businesses had dominated the Chinese financial system. The operation and management of the State Owned Enterprises (SOEs) were strongly influenced by traditional culture and communist ideology. The Chinese culture has been marked by collectivism and Confucianism, with a prominence on respect for pecking order, in-group agreement, reciprocity, and faithfulness. “These culture values, together with tight bureaucratic control from the government, shaped the pre-reform HRM system in the SOEs, which was characterized by lifelong job security, seniority-based promotion and wage increases, and extensive welfare programs. This employment system emphasized egalitarianism and workforce stability; however, it has been criticized as incompatible with the new economic environment” (Ngo, Lau, & Foley, 2008).

Countrywide reforms in HRM have been launched since the 1990s, with the main objective of enhancing competence and output in SOEs. Major changes included the beginning of fixed-term employment contracts and performance-based rewards, a shift in welfare provision accountability, and a new labor law regulating service relations. Additionally, employment policies and practices have been decentralized to the business level, and managers in SOEs have been granted greater independence in hiring and firing workers. In spite of these changes, HR decisions in a lot of SOEs still are affected by social and political contemplations, particularly the speed of social security reform and the possibility of enormous unemployment (Ngo, Lau, & Foley, 2008).

Government interference in enterprise management still persists in SOEs, and organizational inertia has served as a deterrent to the change in HR systems. Some traditional practices like provision of social welfare and personnel administration coexist with market-oriented practices like employment contracts and performance-related rewards, in these enterprises. As a result of the open-door policy, the amount of foreign-invested enterprises has augmented considerably in China over the past two decades. Western mainstream practices in HRM such as formal performance appraisal, performance-based compensation, and widespread training have been widely adopted in these firms. Subject to less administrative interference from the central and local governments, these firms have more discretion in designing their own HR systems (Ngo, Lau, & Foley, 2008).

Organizational Culture in India

There is now widespread evidence to suggest that the uncritical application of western management concepts in the context of the developing countries such as India is burdened with difficulties. Such difficulties are generally attributed to socio-political factors as well as to the differences on various dimensions of national culture. In this regard, it has been argued that India ranks relatively low on individualism and masculinity and high on uncertainty avoidance and power distance. Such national cultural attributes are theorised to generate beliefs and behavioural manifestations which make the application of concepts developed in the western context difficult. “This suggests that any analysis of management concepts in a country like India should adopt a particularly idiosyncratic approach and one which considers the multiple particularities of the context” (Matthew & Ogbonna, 2009).

Overall the literature indicates that the individual work values may have a lot to contribute to the work culture of the organizations in India. A closer look at these values shows a mixed pattern of indigenous and universal values. These value structures substantiated the initial assertion that Indian organizations display certain unique characteristics in the way they function despite the compulsion of modern technology. Numerous Indian scholars have tried to emphasize the exclusive Indian situations and how these situations have contributed considerably to the understanding of the functioning of Indian organizations. There is a mounting realization that Indian socio-cultural values are not dysfunctional to the functioning of organizations, provided that a best possible level of fit can be attained between individual values and organizational values. One of the modalities for doing this is through organizational socialization in which the values of the members of an organization are incorporated with the values of the organization. Most organizations consciously encourage their members to think and behave in consonance with the goals of the organizations (Work Values and Work Culture in Indian Organizations, 2001).

The transplant of the western form of industrial organizations in India was expected to bring a radical shift from a dependency and personalized to a contractual work relationship, from a steeply hierarchical to a reasonably egalitarian authority structure, ascribed to occupational bases of identity formation. The move did not take place to the degree it was anticipated. Instead, technological requirements and job demands at many places were unduly compromised with the socio-cultural factors leading to soft management style which proved to be dysfunctional. “At other places, the same socio-cultural factors helped develop a synergetic work culture where workers and managers worked together for higher productivity and greater viability. The critical factor which made the difference was the establishment of work as the master value. The other social values played a facilitating role in establishing and realizing the work values” (Sinha & Sinha, 1990).

Managing Organizational Culture in India

The new financial environment is principally marked by the freeing of shackles for entrepreneurship and financial growth. The license system has been replaced, to a great degree, by a market system. The challenge of Human Resource Management (HRM) practices would be to generate an environment of flexibility, which can accommodate and incorporate productively changes in systems, structures, technologies and methods. People would have to assign the right meaning to the change process. India is well-resourced to succeed on global markets. It has a pool of extremely educated people, a well-developed judicial system, democratic power, an established banking industry, and fairly refined and inter-linked financial markets. Knowledge industries will be at the front line of economic occasion, and India will be perched to take advantage of this trend with its quantity of highly skilled people. The changes on the market scene have required the Indian industry to look inward for the development of human resources (HR). People develop themselves in a globalized situation with new directions along with new troubles and issues arising to develop new competencies to meet the altering requirements, ambitions, and problems. There are, though, some widespread goods towards which all human resource management efforts should be aimed at. The appearance of Japanese human resource management has led to the notion of culture in a big way. At the organizational level, the objective of HRM is usually to have capable and motivated workers to make sure managerial effectiveness and growth of the organization. Organizations usually direct their HRM efforts towards the development of competencies and organizational culture. Organizations use devices to attain HRM goals with capable and committed workers. Organizations can attain very little even if they have outstanding technological and other resources at their disposal. “Such an assertion gains better credibility in the context of developing countries like India, that is, typically in early growth stages in terms of economic development, and growing more rapidly than the traditional’ developed economies” (Singh, 2010).

Cultural Comparisons

UK and India

Two of the main areas where these two countries are different are in hierarchy and openness. Indian society is very hierarchically organized. In organizations, hierarchy is the central way of managing. If one works for any kind of company, even a small one, they will find a project manager, who is managing the team leader, who is managing the projects, even the smallest one. And the workers will need his superior for anything that they do. In Europe on the other hand, most companies give people responsibility and freedom and measure people on their performance within those boundaries (Messer, 2010).

In India the general spirit is not openness. People are always trying to be very polite and won’t share anything negative or offending, which also makes for a very positive cultural experience. It is sometimes hard to really get the truth or the person’s vision on a subject though. In Europe, people are very open. Sometimes even too open, which results in being blunt or offending people. From an outsourcing perspective it’s valuable to know and recognize these cultural characteristics. By understanding them, it is easier to develop successful cooperation (Messer, 2010).

UK and China

When it comes to culture UK and China are very similar in some aspects. Both are concerned with traditional values and ways of doing things. They tend to be conservative in management and slow to change those things that are tied to the past. One aspect where these countries are different is in the area of politeness. In China their culture is a very polite one and stands very much on tradition. In the UK on the other hand things that are said are often interpreted as being rude even though there is no intention of that meant (Differences in Culture, n.d.).

Analysis and Discussion

How to Improve Corporate Culture

Positive corporate culture can persuade better morale, less turnover and absenteeism, greater efficiency, more innovation and larger bottom lines. A company has a corporate culture, whether one believes so or not, and it can work for someone or against them. Chances are if one is not paying attention to their company’s culture, it’s working against them. The corporate culture is the collection of attitudes, experiences and values that guide the way employees behave. Even new businesses have a corporate culture, and they may be just as powerful as those that are the product of decades of development. Managers differ in the method they deal with corporate culture, and they fall into approximately three groups. The first, who are typically involved in traditional manufacturing businesses, often in assembly-line or production-line settings, take the does not apply approach. They ignore the importance of corporate culture and invest their efforts in perfecting their operating efficiencies (Campbell, 2010).

Those in the second group recognize the significance of corporate culture but do nothing to expand or enhance it. Sometimes they are over-worked and have no time for the soft side of business. At other times, they have the time and incentive but do not know what course to take, or they presume that the culture will take care of itself. The third group includes managers who not only think that corporate culture is significant and make the time to generate and nourish the culture in their business but also have the skills they need to care for a healthy corporate culture. If one is tempted to think that the first two types of companies have no corporate culture while the third type enjoys a healthy one, nothing could be further from the truth. In fact, every company has a corporate culture; it is unavoidable as long as people work there (Campbell, 2010).

Strong cultures mean better spirits, less turnover and absenteeism, greater competence, more innovation and larger bottom lines. This reality arises from the fact that one of the fundamental desires of employees is to be connected to a larger whole, to have a sense of purpose that is defined by the collective. Strong cultures, consequently, are those that promote building and maintaining associations between workers and their organization. Those companies that make no attempt to build a corporate culture risk developing a culture that just doesn’t’ care. “Their employees have no way of connecting to the larger purpose of the organization, nothing to identify with, nothing that gives work greater meaning than the mere production of widgets. Companies that focus their cultures on quantifiable results, such as operational efficiencies, take an even greater risk” (Campbell, 2010).

Managing human resource is becoming very significant feature for success of a business. The workforce in an organization is a precious asset that needs to be managed successfully in order to yield utmost productivity. Management of human resource consequently is directly connected to the organizational strategy since it is aimed at ensuring workers perform their best towards achievement of the strategic goals of the organization. Organizational culture is what links human resource management to organizational performance or strategy. It is fundamentally the everyday working actions of workers within an organization. The behavioral culture will affect the output, competence and attitude of the workforce. This effect can start from a single worker and eventually affect the entire workforce (Human resource management, 2012).

The function of human resource management with regards to organizational culture is to make sure that it is reorganized in a way that it would act as a competitive advantage over its rivals. None of the corporate culture needs to be unnoticed, undervalued or ignored based on their nature. They are exclusive in their own way and the human resource manager needs to center on how each of the corporate culture can be made to suit the organizational strategy. The culture within one organization can be an ideal occasion that makes the organization be noticeable from amongst its competition (Human resource management, 2012).

The way in which human resource management is planned makes sure that necessary information regarding organizational culture is dispersed to every member of the workforce. The information communicated to workers by human resource management team set anticipated standards and behavioral patterns that every employer should view within an organization. The set standards of behaviors are geared towards the aims and objectives of an organization. In this way, the human resource management team plays a very important role that is linked to the organizational strategies through creation of organizational culture (Human resource management, 2012).

Human resource management is planned in this way; it is supposed to set up the exact thing the organization is expecting from each of the workers. It also tries to set up the precise behaviors that an organization should reward. In relation to this, the department comes up with do and don’ts that have to be seen within the organization. In most instances, it is the human resource management team that carries out interviews and introduction seminars. This is because they comprehend what precisely the organization expects from its workers. They also appreciate how each of the workers is expected to behave in line with the strategies of the organization. By playing an active role during induction seminars, the human resource management team is basically trying to transmit or transfer the organizational culture to the new employees joining a firm (Human resource management, 2012).

Theories of Culture

Edgar Schein Theory

Edgar Schein’s management theory centers on the culture inside an organization. According to Schein, culture is the main source of resistance to change within an organization, and a correct understanding of organizational dynamics starts with recognizing this notion. “Edgar Schein’s theory presents three levels of culture, which are necessary to understand for good leadership: artifacts (surface cultures, such as dress, which are easily seen but difficult to decipher), espoused values (conscious goals, strategies and philosophies), and basic assumptions (unconscious beliefs and values that form the core of culture and affect everything we do)” (Management Theory of Edgar Schein, 2012). Schein also examined group dynamics founded on his theory of organizational culture. According to Schein’s theory, groups function within the group culture in the same manner that organizations function within the culture of the organization. His model divides informal groups into three classifications:

Horizontal cliques, or informal groups of similar organizational level who work in close proximity

Vertical cliques, or groups containing a variety of ranks within the same department; and mixed cliques, or groups containing members of dissimilar levels, departments and locations (Management Theory of Edgar Schein, 2012).

Producing a corporate culture shows the importance of creating suitable systems of shared values and beliefs to help workers work together to attain business goals. According to Edgar Schein, the culture of a group is defined as a pattern of shared basic assumptions that the group has learned to resolve issues and the transference of those assumptions to new group members. In other words, the Schein theory suggests that as groups resolve problems, they form a collective learning environment that creates a set of shared beliefs. These beliefs make up the actual culture of the group (Making the Most of Management Theory of Edgar Schein, 2012).

According to Edgar Schein, leaders must become knowledgeable about the cultures in which there are members to successfully manage groups. Schein pluralizes cultures because as noted in the Schein theory on open-systems concepts. It’s common for several sub-cultures to develop within a culture. Successful leaders should be aware of all primary and sub-cultures to which they belong to truly make the most of this theory (Making the Most of Management Theory of Edgar Schein, 2012).

According to Schein, culture exists all at the same time on three levels. On the surface are artifacts, beneath artifacts lie values, and at the core are basic suppositions. Suppositions represent taken-for granted beliefs about realism and human nature. Values are social principles, philosophies, goals, and standards measured to have inherent worth. Artifacts are the observable, touchable, and audible consequences of activity grounded in values and assumptions. Schein claimed that basic assumptions hold the key to understanding and changing a culture. He has argued that assumptions are best looked at using clinical methods and suggested that a motivated group of insiders raise its own assumptions to awareness with the aid of a clinically trained consultant. However, researchers who want to chase culture beyond this inner circle may find the clinical approach unworkable. Schein’s model has value for nonclinical studies, but the under requirement of his theory hampers these applications. In particular, the value of his model depends upon identifying the links among a culture’s artifacts, values, and assumptions (Hatch, 1993).

When looking at expanding business from the UK into China and India it would be important to take into account Schein’s theory. This theory is founded on the idea that values are social principles, philosophies, goals, and standards that are all measured to have inherent worth. The clothing company is question would be able to apply this theory in order to uphold their strong commitment to meeting customers’ needs, striving for excellence and having a sense of commitment to the organization, so that employees are willing to go the extra mile. The company would have to make sure to tape into the culture that exists in the country in which they are expanding in order to define the values that already exist and then align them to the goals that the company has.

Hofstede’s Theory

According to Hofstede culture is the communal programming of the mind which differentiates the members of one category of people from another. It may be recognized as ways of behaving, and ways of understanding, that are shared by a group of people (Human resource management with strategic goals and objectives, 2012). Geert Hofstede developed a theory of management that recognizes the differences between diverse cultures. In an increasingly global economy, Hofstede’s theory is perhaps even more relevant to businesses today than it was when he first developed it. The Hofstede theory asserts that, because of intrinsic cultural differences between nations, no universal management method exists which can be considered globally valid. For any company that deals in international commerce, Hofstede management theory can mean the difference between failure and success in the international marketplace. Even companies which only deal locally or nationally can benefit from an understanding of the management theory of Geert Hofstede, as they attempt to effectively motivate and optimally utilize a culturally diverse workforce, many of whom are immigrants.

Geert Hofstede’s theory presents five dimensions, or value perspectives, in which national cultures differ, each of which profoundly affects the business management methods that will succeed with any specific national group. These include:

1. “Power distance: the degree of inequality between people that a culture considers normal

2. Individualism vs. collectivism: the cultural belief that the concerns of the individual or the concerns of the group take precedence

3. Masculinity vs. femininity: the culturally-based preference for achievement or relationship

4. Uncertainty avoidance: the degree to which a culture is comfortable with ambiguity

5. Long-term vs. short-term orientation: the culturally-based tendency to value perseverance, preparation and saving or traditions, present obligations, etc.” (Management Theory of Geert Hofstede, 2012).

Hofstede’s theory is a great theory to consider when thinking about doing business internationally. This theory is based on the notion that because of intrinsic cultural differences between nations, no universal management method exists which can be considered globally valid. In this case study the clothing company in the UK would need to learn as much as they could about the culture in which they were looking to do business and then adjust their management practices to fit within that culture. With no universal management practices that work everywhere in order to be successful one would need to adapt to the culture at hand.

Charles Handy’s Culture Theory

The theories of Charles Handy have had a powerful effect on modern management thinking. His views on organizational development and leadership have helped usher in a more humanitarian style of management and a more visionary and purpose-driven organizational methodology. Along with various other theoretical models, Charles Handy expounded his Four Cultures Theory in which he described each individual culture, relating it to one of the Greek gods. Each of Handy’s cultures stems from a different presupposition about human motivation, thought and learning, as well as a different assumed basis for power and influence. Handy’s four cultures include:

1. “The Power Culture: Based on Zeus, this culture is one of centralized, or top-down, power and influence.

2. The Role Culture: Based on Apollo, this culture is a bureaucratic one, run by strict procedures, narrowly defined roles and precisely delineated powers.

3. The Task Culture: Based on Athena, this culture is small-team-based, results- and solutions-oriented, and marked by flexibility, adaptability and empowerment.

4. The Person Culture: Based on Dionysius, this culture focuses on the individual. Such an organization is values-oriented, people-focused and geared toward meeting individual employees’ self-actualization needs” (Management Theory of Charles Handy, 2012).

When applying Handy’s theory to the case study it would be important for the clothing company to look at the four levels of culture and come up with a plan on how they will deal with each as each level will present its own set of challenges and issues.

Trompenaars’s Culture Theory

Fons Trompenaars developed a model of dissimilarities in national cultures. This model includes seven dimensions, which are thought to shed light on how people in dissimilar national cultures interrelate with each other. The seven dimensions were found using questions that were intended to portray different dilemmas of everyday life. The respective culture’s most likely response to each dilemma can be seen to demonstrate the deep values entrenched in different cultures, and are used to generalize each national culture’s most likely response to everyday dilemmas and human interactions. The different dimensions are useful in understanding different connections between people from different national cultures, and can give guidance to e.g. expatriates having managerial tasks in different cultures (What are Fons Trompenaars’ Cultural Dimensions, 2010).

The seven dimensions include:

1. “Universalism vs. particularism (What is most important – rules or relationships?)

2. Individualism vs. collectivism (Do we function in a group or as individuals?)

3. Neutral vs. emotional (Do we display our emotions, or do we hide them?)

4. Specific vs. diffuse (Do we handle our relationships in specific and predetermined ways, or do we see our relationships as changing and related to contextual settings?)

5. Achievement vs. ascription (Do we have to prove ourselves to receive status, or is status given to us?)

6. Sequential vs. synchronic (Do we do things one at a time or several things at once?)

7. Internal vs. external control (Do we believe that we can control our environment, or do we believe that the environment controls us?)” (What are Fons Trompenaars’ Cultural Dimensions, 2010).

Trompenaars tested these seven dimensions on over fifty national cultures. The results found in every national culture, which demonstrates the preferred response to different dilemmas concerning each dimension, can consequently be used by business managers to foresee, how dissimilar people from different cultures may act and behave in a business setting (What are Fons Trompenaars’ Cultural Dimensions, 2010).

Trompenaars theory is a great theory to apply to this case as it breaks down the big areas that are so frequently different from culture to culture. These are the main things that need to be looked at when considering doing business internationally. If these things are addressed as part of the overall expansion plan by the clothing company in this case it would provide them with the best picture of what the differences are between their home culture and the culture abroad. Recognizing and having a plan on how to deal with these differences gives a company the best shot at being successful.

Cultural Relativism

Cultural relativism is the standard of regarding the beliefs, values, and practices of a culture from the viewpoint of that culture itself. Originating in the work of Franz Boas in the early 20th century, cultural relativism has greatly influenced social sciences such as anthropology. In sociology, the principle is from time to time practiced to avoid cultural bias in research, as well as to avoid judging another culture by the standards of one’s own culture. For this reason, cultural relativism has been measured an attempt to avoid ethnocentrism. Cultural relativism is related to but often distinguished from moral relativism, the view that morality is relative to a standard, especially a cultural standard (What is cultural relativism, 2011).

Cultural relativism is the view that all beliefs, customs, and ethics are relative to the individual within his own social context. In other words, right and wrong are culture specific; what is considered moral in one society may be considered immoral in another, and, since no universal standard of morality exists, no one has the right to judge another society’s customs. Cultural relativism is widely accepted in modern anthropology. Cultural relativists believe that all cultures are worthy in their own right and are of equal value. Diversity of cultures, even those with conflicting moral beliefs, is not to be considered in terms of right and wrong or good and bad. Today’s anthropologist considers all cultures to be equally legitimate expressions of human existence, to be studied from a purely neutral perspective (What is cultural relativism, 2011).

Cultural relativism is closely related to ethical relativism, which views truth as variable and not absolute. What constitutes right and wrong is determined solely by the individual or by society. Since truth is not objective, there can be no objective standard which applies to all cultures. No one can say if someone else is right or wrong; it is a matter of personal opinion, and no society can pass judgment on another society. Cultural relativism sees nothing inherently wrong (and nothing inherently good) with any cultural expression (What is cultural relativism, 2011).

How to Improve Corporate Culture in the UK

Human Resources Management (HRM) is a great advance to employment management which tries to reach enormous advantage through the strategic deployment of a highly dedicated workforce by using integrated array of culture, structural, and personnel techniques, whereby Personnel Management is a series of actions which enable people of hiring and developing workers in the organisation. “It includes: job analysis, personnel needs, recruitment, training etc. Strategic HRM can be defined as a general approach to the Strategic Management of Human Resources in accordance with the intentions of the organisation on the future direction it wants to take. It is concerned with longer-term people issues and macro-concerns about structure, quality, culture, values, commitment and matching resources to future need” (Human resource management with strategic goals and objectives, 2012).

How to Improve Corporate Culture in China

HR can add real value in securing the talent needed for business expansion, as well as preparing and improving strategies for talent flow, attraction and retention across countries, cities and regions. Finding talent to increase business expansion in particular can be taxing for foreign companies targeting second- and third-tier cities or even smaller markets in China. In addition to coping with high turnover of managers in first-tier cities, they have to attract and recruit a large number of business development staff each year. However, cross-regional HR allocation in China is not straightforward. First, it is challenging to move and retain talent in emerging markets, which lag behind first-tier cities in terms of education, medical resources, service facilities and overall standard of living. Second, Chinese private-owned companies, who are better at encircling cities from rural areas, transfer their research and development and marketing centers to first and second-tier cities where talent is plentiful, such as Beijing, Guangzhou, Shanghai, Xiamen and Shenzhen. This leads to more and fiercer competition for management-level talent between foreign and Chinese private-owned companies. To gain an advantage in the current talent war, foreign companies should not only regularly review their compensation incentive systems and employee benefits according to the local market, but HR departments must also consider how best to develop high-potential employees from the perspective of a mid- and long-term business strategy (Winning in China: Building Talent Competitiveness, 2010).

HR management needs to ensure that workers in functional posts and at the management level understand how their personal work goals support the business objectives of the organization. Criteria for talent selection and assessment must be designed to match the strategic development of the organization, with candidate profiles of competencies and qualifications to ensure alignment. Consequently, high-caliber recruitment teams should be developed to guide the recruitment process in order to recruit the right talent. If necessary, Chinese private-owned companies should establish a set of efficient and normative recruitment systems and management processes with the help of a HR consulting partner.

In the meantime, in response to talent shortages, and especially to the global talent shortage, Chinese private-owned companies should reserve key talent for IPOs and overseas expansion.

Moreover, as China’s labor market becomes more sophisticated, employees’ awareness of their rights is also increasing, as is the quality of talent. Chinese private-owned companies therefore urgently need to refine their HR management with respect to labor and employee relations, performance management, career planning and development, and employee training and development. They must shift HR management from everyday management to developing worker potential, which will also serve to methodically attract and retain core talent in alignment with corporate strategy (Winning in China: Building Talent Competitiveness, 2010).

How to improve Corporate Culture in India

Globalization has accelerated the transfer of not only product and services, but also corporate management practices. The transfer of HRM practices occurs mostly from developed countries to developing ones. Multinational Company’s (MNCs) operating in many countries with different socio-economic and cultural orientations face serious challenges in implementing Western HRM practices in the developing countries. Effective implementation of HRM practices is largely dependant on the extent to which the practices are perceived to be appropriate by managers and their subordinates. Therefore, a thorough understanding of the cultural and other contextual elements where HRM practices are being implemented is required in order to maximize the outcome.

Despite the general applicability of HRM theories, HRM practices carry a significant amount of local flavors. In any particular nation, HRM practices will be rooted in the country’s historical, political, social and political differences. As opposed to widespread aspects, locally meaningful aspects of HRM are based on workers work-related values and attitudes. These deep rooted values and attitudes have a strong connection with the workers occupational, cultural and social backgrounds. In other words, these values are rooted in their societies. Due to the deep anchoring of HRM practices in the historical, political, economic, social and cultural environment of a country, the import or transfer of these practices from developed to the developing countries may produce unexpected results. This can be seen in many East European countries, where despite both ownership and management changes in many big firms as a result of economic liberalization in the 1990s, HR practices remained almost unchanged because the legacy of the previous institutional environment continued to play an influential role in the successful operations of these corporations (Taplin & Frege 1999).

The relationship between contextual elements, especially culture and organizational practices, has opened several avenues for research investigation. General systems theory, societal effect theory and institutional theory offer useful explanations about the ways in which social and organizational contexts influence HRM practices in organizations. It has been suggested that the question in HRM might be common, but the how question is definitely culturally precise. Rather than affecting directly, culture has a moderating effect on organizational practices. Even though contingent factors help determine the organizational structure, culturally driven preferences influence the selection of appropriate practices. There has been the proposition of a theoretical model of culture fit (MCF) which explicitly links culture to organizations HRM practices. The model proposes that the internal work culture is based on managerial beliefs and assumptions about two basic organizational elements: the task and the employees. Managers implement HRM practices based on their perceptions of the nature of both the task and of employees and these perceptions are rooted in the socio-cultural context of the employees (Kanungo & Jaeger, 1990).


Organisational culture is the values, attitudes, norms and cultures that characterise a specific organisation. Organisational culture is not a stationary principle as it changes over time. There are certain aspects that shape organisational culture as explained by Schein. The first one being the owners of a particular company. Another factor is the principles held by the firm’s workers. In addition, competitors within the industry a company is operating in will also influence this. There is also a need to react customer needs and requirements. All of these factors will change with time and as a result affect organisational culture. One can consequently say that organisational culture is typically described by group factors such as ideology and concepts; there is a need to comprise normative behaviour when tackling this issue.

Organisational culture is not something that can be viewed very easily it is consequently quite hard to replace it. Usually when certain leaders form a company, their values are converted into the actions of the members of that organisation. When other leaders take over, it may not be as easy to alter those perspectives right away. Sometimes some of their actions; like rewards may transform the ways workers go about their day-to-day activities but it may be hard to change their culture.

Schein asserts that it is significant to manage organisational culture because he believes the latter term is the key to achievement of excellence within any one organisation. He also believes that leaders are given the task of generating and also managing organisational culture. Managers who are able to recognize organisational culture can then build up on the following important aspects;

learning levels output strategic development

There are also definite obstructions or strong points that may be fashioned as a consequence of organisational culture. Structure and methods accessible for organisations need to be streamlined to suite certain common cultural insights in the organisation. Leaders must recognize the elements of organisational culture that will come in the way of attaining organisational goals and get rid of them while at the same time, managers must make sure that they strengthen elements of their organisational culture that facilitate success. It should be noted that organisational culture makes a company what it is; it gives the organisation a sense of distinctiveness. As a result, members within that organisation will feel associated to that organisation because of its culture. Despite the fact that culture is one and the same to a certain organisations, one should realise that there may be certain dissimilarities within one firm. There may be existence of sub-cultures in the organisation and when a new member joins the organisation, they may have not see the level of unity of those organisational values. Therefore, an organisation with a strong organisational culture is one in which most of the members of the organisation share alike values and those ones that have made their expectations from their workers clear.

Hofstede came up with a model that placed organisational culture in a band of five major factors:

Long-term vs. Short-term

Dominant values

Uncertainty avoidance


Individual vs. collectivist

He asserted that organisational culture stands for the bargaining capability of a particular group as compared to others. He adds that organisational culture symbolizes the way people have been programmed in a certain environment. As a result, the foundation factor within any given culture is the social context where it stems from. In light of these facts, one can say that it is significant to manage organisational culture because it permits leaders to balance all the five qualities in such a way as to make the most of their potential.

Handy came up with a theory of organisational culture that is linked with organisational structure. He says that power culture is created when there are only a few people who have the capability to make decisions. In this kind of culture there is very little room for hierarchies and protocols. Instead, the decision making process is quite competent as control emerges from the centre. Organisations that are usually faced with a lot of decision making situations should take on such a strategy. It is consequently important to manage organisational culture in this sense because it permits the decision making process to become more competent or more effective.

Sometimes there are cases when organisations may take on a role culture. In this kind of organisational culture, there is a lot of reference to higher powers. One person has to go through a lot of hierarchies before getting approval for their projects. As a result, very little room is left for people to make decisions on their own. According to this category, one can assume that it is important to manage organisational culture so as to give more power to people holding certain positions. However it should be noted that companies who wish to institute quick decision making process may not always choose that option. Companies that wish to respect make clearly defined structures can take up that role.

Another category is task culture. Organisations taking up this role are those ones in which teams are made up to solve problems facing the company. Decisions are made by those team members depending on who has the highest form of expertise. This is usually characterised by a matrix structure. It can therefore be said that managing organisational culture is important because it permits certain companies to employ the skills and knowledge of their experts. This will go a long way in enhancing a company’s competence because decisions will be made on the basis of who had the widest quantity of knowledge about a certain issue. This is quite useful in the attainment of a company’s efficiency.

Another category proposed by Handy was person culture. Organisations that take up such a structure of culture are usually characterised by the conviction that all members of the organisation have some form of power. In these organisations, there is very little room for pursuance of the organisation’s objectives since most of the time people are focusing on themselves. Yet, one should not simply discharge this form of culture since there are instances when it is fitting. For instance a firm made up of two partners may take on such a culture because the various partners are able to apply their expertise to their own clients. In light of these facts, one can say that it is significant to manage organisational culture because it permits some partners to focus on their objectives in the company. If these different objectives are fused together, then a given company may be able to advance its performance since each partner is bringing in their own clients.

Trompenaars explains that the outer layer of culture has to be understood as a compilation of symbols that go back to our cultural norms and values, and even more intensely peoples basic assumptions. Cultural expressions are part of any culture and are usually the easiest to access. Consequently they can be used as a starting point for the understanding of cultural differences. If one wants to get a better understanding of the behaviour of people from dissimilar cultural backgrounds they need to dig deeper into the cultural frameworks that guide their own everyday interactions.

Trompenaars also said that the outer layer of culture stands for cultural depictions, described as signs and rituals. This layer can be accessed by way of observation or the attainment of culture relevant knowledge. Frequently the attempt to come to terms with another culture is left at that. This is especially true for many and might be one reason for existing stereotypes. The magnitude of differences can be overwhelming at first sight. Some might react with respect, others with withdrawal of deeper interest. Prolonged working experiences in the area might also cause a level of unawareness through over generalisation. The key for changing intercultural experience into intercultural competence is self-reflection, which for people can be a difficult skill to obtain.

Cultural relativism is the view that no culture is superior to any other culture when comparing systems of morality, law and politics. It’s the philosophical notion that all cultural beliefs are uniformly valid and that truth itself is relative, depending on the cultural environment. Those who hold to cultural relativism hold that all religious, ethical, aesthetic, and political beliefs are totally relative to the individual within a cultural identity. Relativism often includes moral relativism, where ethics depend on a social construct, situational relativism, where right or wrong is based on the particular situation, and cognitive relativism, where the truth itself has no objective standard.


It is important to administer organisational culture because companies can use this to their advantage when trying to sustain competitive advantage. For instance, organisational culture can be managed by making sure that the recruitment and selection process enhance the organisation culture. This will go a long way in strengthening the prevailing organisational culture and if it was fitting in the first place, then there will be better results in the end. Organisational culture should also be managed in the training level provided within any particular company. For instance career development strategies taken on by certain companies should be such that they reflect a specific company’s strategy. In line with this management of organisational culture will also be attained by way of proper communication particularly when members of the company have to work on teams. This will be very influential in the strength of mind of bringing together different members of the company regardless of their personal cultural backgrounds. Consequently, more work will get done by people who understand the organisation and there will be better competence.

Companies can also put into practice certain reward systems that will give confidence to certain behavioural traits. This is quite instrumental in the process of upholding positive behavioural traits that are influential in the process of achievement of organisational objectives. In relation to this, leaders can help in the process of reinforcing organisational culture through serving as examples. The company managers can be able to install myths symbols and integration of visions and missions. This will help workers understand the purpose and objectives of the organisation and will persuade them to perform well.

Companies that wish to manage cultures should encourage participation of other members of the organisation in the development activities, decision making and input to the organisation. This will make the workers feel as though they are valuable members of the organisation and they will be motivated to work harder. Lastly, the company should go out of its way to facilitate better communication between members of the organisation. This can be achieved through teamwork integration. It will go a long way in maintaining systems that help the company to stay ahead of its competitors.

Organizational culture is very important to the success of any company and needs to be managed, and managed well, no matter why type of culture exists. The worst thing that a company can do is ignore the culture that is present and just let things take care of themselves. Successful companies always have their finger on the pulse of what is going on within their company so that they can encourage good behaviour and discourage bad behaviour. The company must maintain control and the best way to do this is to know what the culture is and mold it to work best for everyone involved.


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