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CHAPTER II CORPORATE CULTURE 2.

1 Definition of Corporate Culture There are some definition about Corporate Culture, they are: 1. According E. Jacques, Corporate Culture is Conventional or traditional ay of thin!ing and behaving hich is shared to some e"tent by organi#ation members and hich has to be, at least partially, accepted by ne employees. $. According E. %chein, Corporate Culture is A pattern of fundamental shared assumptions hich a given group created hile solving the problems of adaptation to environment and those of internal integration. &t is inculcated in ne organi#ation members as a correct method of problems solving. '. According (. %chenplein, Corporate Culture is )alues, norms and beliefs generally accepted in the organi#ation and creating a system. *. According +. (ofstede, Corporate Culture is ,-ind programming. in organi#ation members, thus a set of values, norms and organi#ational rules successfully inculcated by the group. /. According 0. 1eshapande and 0. 2arasurman, Corporate Culture is 3n ritten, often subconsciously perceived, rules hich fill a gap bet een the un ritten and actually happening in the organi#ation. 4. According 5. %mircich, Corporate Culture is %emantic net or!s created by people in the course of organi#ation.
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Corporate culture refers to the shared values, attitudes, standards, and beliefs that characteri#e members of an organi#ation and define its nature. Corporate culture is rooted in an organi#ation6s goals, strategies, structure, and approaches to labor, customers, investors, and the greater community. As such, it is an essential component in any business6s ultimate success or failure. Closely related concepts, discussed else here in this volume, are corporate ethics 7 hich formally state the company6s values8 and corporate image 7 hich is the public perception of the corporate culture8. The concept is some hat comple", abstract, and difficult to grasp. A good ay to define it is by indirection. The (agberg Consulting +roup does 9ust that on its :eb page on the sub9ect. (C+ suggests five questions that, if ans ered, get at the essence:

:hat 1; ords ould you use to describe your company< Around here hat6s really important< Around here ho gets promoted< Around here hat behaviors get re arded< Around here ho fits in and ho doesn6t<

As these questions suggest, every company has a culture=but not all cultures 7or aspects of them8 help a company reach its goals. The questions also suggest that that companies may have a >real culture,> discernible by ans ering these questions, and another one hich may sound better but may not be the true one. The concept of corporate culture emerged as a consciously cultivated reality in the 1?4;s along@side related developments li!e the social responsibility movement=itself the consequence of environmentalism, consumerism, and public hostility to multinationals. A areness of corporate culture as undoubtedly also a consequence of

gro th, not least e"pansion overseas= here corporations found themselves competing in other national cultures. The 3.%. competition ith Japan, ith its unique corporate culture, as yet another influence. %o as the rise to prominence of management gurus the dean of hom as 2eter 1ruc!er. As corporations became a are of themselves as actors on the social scene, corporate culture became yet another aspect of the business to atch and to evaluate=alongside the >hard> measures of assets, revenues, profits, and shareholder return. Corporate culture by definition affects a firm6s operations. &t is also, by definition, something that flo s from management do n ard and out ard. &n many corporations, the >culture> as set very early on by the charismatic activity and leadership of a founder. Aut as ma9or tendencies become deeply institutionali#ed, corporate culture also becomes an institutional habit that ne comers acquire. &n actual practice >reinventing> the corporation from the top do n, therefore, is difficult to achieve, ta!es time, and happens only under strong leadership. Bbservers and analysts of the phenomenon tend to subdivide culture into its various e"pressions related either to ma9or constituencies 7employees and or!ers, customers, vendors, government, the community8 or to methods or styles of operation 7cautious, conservative, ris!@ta!ing, aggressive, innovative8. A corporate culture may also, by overstepping certain bounds, become suicidal=as the case of Enron Corporation, the energy trader, illustrates. &n the Enron culture an aggressive, creative, high@ris! style led to fraud and ultimate collapse. Analysis is helpful in understanding ho a corporate culture e"presses itself in specific areas. (o ever, the concept is social and culture, as the phrase itself implies. &t does not lend itself to reorgani#ation by a rearrangement of standard building bloc!s. 2.2 The Component of Corporate Culture
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The benefits of a strong corporate culture are both intuitive and supported by social science. According to James 5. (es!ett, culture ,can account for $;@';C of the differential in corporate performance hen compared ith Dculturally unremar!ableE competitors.. And (A0 riters have offered advice on navigating different geographic cultures, selecting 9obs based on culture, changing cultures, and offering feedbac! across cultures, among other topics. Aut hat ma!es a culture< Each culture is unique and myriad factors go into creating one, but &Eve observed at least si" common components of great cultures. &solating those elements can be the first step to building a differentiated culture and a lasting organi#ation. a. Vision A great culture starts ith a vision or mission statement. These simple turns of phrase guide a companyEs values and provide it ith purpose. That purpose, in turn, orients every decision employees ma!e. :hen they are deeply authentic and prominently displayed, good vision statements can even help orient customers, suppliers, and other sta!eholders. Fonprofits often e"cel at having compelling, simple vision statements. The Al#heimerEs Association, for e"ample, is dedicated to ,a orld ithout Al#heimerEs.. And B"fam envisions ,a 9ust orld ithout poverty.. A vision statement is a simple but foundational element of culture. b. Values A companyEs values are the core of its culture. :hile a vision articulates a companyEs purpose, values offer a set of guidelines on the behaviors and mindsets needed to achieve that vision. -cGinsey H Company, for e"ample, has a clearly articulated set of values that are prominently communicated to all employees and involve the ay that firm vo s to serve clients, treat colleagues, and uphold professional standards. +oogleEs values might be best

articulated by their famous phrase, ,1onEt be evil.. Aut they are also enshrined in their ,ten things e !no to be true.. And hile many companies find their values revolve around a fe simple topics 7employees, clients, professionalism, etc.8, the originality of those values is less important than their authenticity. c. Pra!ti!es Bf course, values are of little importance unless they are enshrined in a companyEs practices. &f an organi#ation professes, ,people are our greatest asset,. it should also be ready to invest in people in visible ays. :egmanEs, for e"ample, heralds values li!e ,caring. and ,respect,. promising prospects ,a 9ob Ithey6llJ love.. And it follo s through in its company practices, ran!ed by Kortune as the fifth best company to or! for. %imilarly, if an organi#ation values ,flat. hierarchy, it must encourage more 9unior team members to dissent in discussions ithout fear or negative repercussions. And hatever an organi#ationEs values, they must be reinforced in revie criteria and promotion policies, and ba!ed into the operating principles of daily life in the firm. d. People Fo company can build a coherent culture ithout people ho either share its core values or possess the illingness and ability to embrace those values. ThatEs hy the greatest firms in the orld also have some of the most stringent recruiting policies. According to Charles Ellis, as noted in a recent revie of his boo! What it Takes: Seven Secrets of Success from the Worlds Greatest Professional Firms the best firms are ,fanatical about recruiting ne employees ho are not 9ust the most talented but also the best suited to a particular corporate culture.. Ellis highlights that those firms often have L@$; people intervie each
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candidate. And as an added benefit, %teven (unt notes at -onster.com that one study found applicants ho ere a cultural fit ould accept a MC lo er salary, and departments ith cultural alignment had ';C less turnover. 2eople stic! ith cultures they li!e, and bringing on the right ,culture carriers. reinforces the culture an organi#ation already has. e. "arrati#e -arshall +an# as once a !ey part of Caesar Chave#Es 3nited Karm :or!ers movement and helped structure the organi#ing platform for Aarac! BbamaEs $;;L presidential campaign. Fo a professor at (arvard, one of +an#Es core areas of research and teaching is the po er of narrative. Any organi#ation has a unique history = a unique story. And the ability to unearth that history and craft it into a narrative is a core element of culture creation. The elements of that narrative can be formal = li!e Coca@Cola, hich dedicated an enormous resource to celebrating its heritage and even has a :orld of Co!e museum in Atlanta = or informal, li!e those stories about ho %teve JobsE early fascination ith calligraphy shaped the aesthetically oriented culture at Apple. Aut they are more po erful hen identified, shaped, and retold as a part of a firmEs ongoing culture. f. Pla!e :hy does 2i"ar have a huge open atrium engineering an environment here firm members run into each other throughout the day and interact in informal, unplanned ays< :hy does -ayor -ichael Aloomberg prefer his staff sit in a ,bullpen. environment, rather than one of separate offices ith soundproof doors< And hy do tech firms cluster in %ilicon )alley and financial firms cluster in 5ondon and Fe Nor!< There are obviously numerous ans ers to each of these questions, but one clear ans er is

that place shapes culture. Bpen architecture is more conducive to certain office behaviors, li!e collaboration. Certain cities and countries have local cultures that may reinforce or contradict the culture a firm is trying to create. 2lace = hether geography, architecture, or aesthetic design = impacts the values and behaviors of people in a or!place. There are other factors that influence culture. Aut these si" components can provide a firm foundation for shaping a ne organi#ationEs culture. And identifying and understanding them more fully in an e"isting organi#ation can be the first step to revitali#ing or reshaping culture in a company loo!ing for change. 2.$ The E%ample of Usin& Corporate Culture in Compan' There are some companies that use corporate culture and success in doing business. They are: a. (e lett 2ac!ard Company Corporate Culture as formed and implanted by a regular or even a founder leader of each company ith the goal of a positive impact on performance and synergy team or! its employees ith the aim of improving the moral and conducive or!ing environment . :ith such an ob9ective , Corporate Culture can be changed or modified ith the purpose of providing an ad9ustment to the conditions that occur ithin the company , to ho companies @ clic!ing Bvercome the problems that occur in the company . 0eal e"ample that & ill give is a leading multinational information technology company in the orld , (e lett 2ac!ard 7 (2 8 , hich as founded by Aill (e lett and 1ave 2ac!ard . Aill and 1ave since the founding of (e lett 2ac!ard has invested Corporate Culture is very interesting that they call the (2 :ay . The (2 :ay include :
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1. :e have trust and respect for individuals . $. :e focus on a high level of achievement and contribution . '. :e conduct our business ith uncompromising integrity . *. :e Achieve our common ob9ectives through team or! . /. :e Encourage fle"ibility and innovation . The (2 :ay is al ays embedded in all (2 employees in all branches around the orld . Aut do not rule out the e"istence of other cultures ad9ustment in each individual company , for e"ample in (2 hich too! place in the 3%A , the manager also implements the entrenched system in hich employees are required to determine the ' personal targets and ' targets professional or!ing in (2 ithin a period of 1 year , and then the management is able to monitor hether its taget reali#ed or not . This course aims to improve morale and employee morale !arya a (e lett @ 2ac!ard 7 (2 8 itself to improve its productivity . b. :al@-art %tores, &nc. :al@-art %tores, &nc. is an American public corporation that runs a chain of large discount department stores and a chain of arehouse stores. &n $;1; it as the orld6s largest public corporation by revenue, according to the Korbes +lobal $;;; for that year. The company as founded by %am :alton in 1?4$. Learn Our Culture Open Door At :almart, our management believes open communication is critical to understanding and meeting our associatesE and our customersE needs. TheyEll or! ith you to mutually resolve any issues or problems you may have. :eEre all part of the same family =the :almart family. And li!e family, e care. The open door has helped solve some of our biggest problems, and it6s generated some of our greatest ideas. Three Aasic Aeliefs H )alues 0espect for the &ndividual

%ervice to our Customers %triving for E"cellence 1()*oot Rule The 1;@foot 0ule is one of our secrets to customer service. 1uring his many store visits, %am :alton encouraged associates 7employees8 to ta!e this pledge ith him: >& promise that henever & come ithin 1; feet of a customer, & ill loo! him in the eye, greet him, and as! if & can help him.> >& learned early on that one of the secrets to campus leadership as the simplest thing of all: %pea! to people coming do n the side al! before they spea! to you,. %am once said. ,& ould al ays loo! ahead and spea! to the person coming to ard me. &f & !ne them, & ould call them by name, but even if & didn6t, & ould still spea! to them. Aefore long, & probably !ne more students than anybody in the university, and they recogni#ed me and considered me their friend. & ran for every office that came along.> +er#ant Lea,ership %am :alton believed that effective leaders do not lead from behind their des!s. >&t6s more important than ever that e develop leaders ho are servants, ho listen to their partners O their associates O in a ay that creates onderful morale to help the hole team accomplish an overall goal,. %am said. Team-or. /utual +upport :e help each other best serve our customers :e each have an opportunity to do something great for the team -utual 0espect :e loo! for and e"pect the best in others :e anticipate that everyone ants to be successful and e al ays loo!s for ays to improve Bur shared diversity is one of our greatest strengths
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0al/art Cheer +ive me a :P +ive me an AP +ive me an 5P +ive me a squigglyP +ive me an -P +ive me an AP +ive me an 0P +ive me a TP :hat6s that spell< :almartP :hose :almart is it< &t6s my :almartP :ho6s number one< The customerP Al aysP 1on6t be surprised if you hear our associates shouting this enthusiastically at your local :almart store. :e ta!e it seriously = it6s one ay e sho pride in our company and ho much e value our customers. And %am believed or! can be fun. c. FBG&A CBFFECT&F+ 2EB25E As a orld leader in mobile phone technology , Fo!ia faced ith a difficult tas! hen the company decided to significantly e"pand its operations in Aurlington , Fe England , 3%A . The rapid gro th of the company , combined ith Fo!ia to e"pand its investment research and development , ma!e them build a 1'/,;;; @square to their ne office , and as named The Fo!ia (ouse Aoston . &n place of this ne Fo!ia vigorously rooting for e"isting Corporate Culture Corporate control . (ouse Aoston presents an opportunity to integrate Fo!ia Cultural (eritage as much as possible . The company prides itself on four core values and principles that e"ist in the heart of the philosophy of the Company : C3%TB-E0 %AT&%KACT&BF AC(&E)E-EFT respecting 0E%2ECT KB0 &F1&)&13A5

CBFT&F3B3% 5EA0F&F+

Krom the character of the building , (ouse Aoston should reflect the physical beauty and climate of Kinland 7 country of origin FBG&A 8 , such as natural ood for the interior as ell as natural lighting . %trong corporate image is reflected in the design of buildings that demonstrate achievement as the orld technology leader . Fo!ia combines elements of %candinavian and Fe England to provide an open or!space environment that promotes interaction among co@ or!ers . (ouse Aoston create opportunities for the e"change of ideas empo erment of employees , customers , suppliers and partners for business success , but also e"pand e"ternal relations Fo!ia . Corporate culture inculcated even in branches Q ne operating area so that employees can be more productive and improve customer satisfaction , continue to innovate and to love Q have a high sense of belonging to the company . d. Fissan -otor Company F&%%AF :AN is the principle hich gives direction to every element of the company in running the company6s business . Core message is > strength comes from ithin . > &n the Fissan -otor Company , professionalism comes from personal strength , creativity , and dedication . F&%%AF :AN is a proven method in creating innovations on a regular basis . F&%%AF :AN is composed of the core messages %trength comes from ithin , focus is the customer , is creating a force that encourages success and si#e is an advantage . Fissan :ay consists of the principles of the habit of thin!ing 7 mindset 8 and act 7 action 8 that is e"pected of all Fissan employees in
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performing their daily or! . These principles are simple and fle"ible , because it is not based on tradition but is based on !no ledge and e"perience , a strong flo of information from each division , business area , and the alliance ith 0enault . The principle aims to encourage effective performance of each employee . 1; 2rinciples in F&%%AF :AN : -&F1%ET Cross @ functional , cross @ cultural : Ae open and sho empathy to ard different vie s R elcome diversity . Transparent : Ae clear , be simple , no vagueness and no hiding . 5earner : Ae passionate . 5earn from every opportunity R create a learning company . Krugal : Achieve ma"imum results ith minimum resources.S Competitive : Fo Complacency , focus on competition , and continuous benchmar!ing . ACT&BF% -otivate : (o are you energi#ing yourself and others < Commit H Target : Are you accountable and are you stretching enough to ard your potential < 2erform : Are you fully focused on delivering results < -easure : (o do you assess performance < Challenge : (o are you driving a continuous and competitive progress across the company < 1; supports the principles above handling both inside the company . Kor e"ample, the principle demands Transparent management and employees to be honest , as ell as t o@ ay communication that effective . &nternal and e"ternal relations based on mutual respect and trust . &t is fostered by an e"change of information . The ne communications net or! in the Fissan no allo employees to access company information more quic!ly , more effectively , and to share

hat they !no ith investors , shareholders , suppliers , media and other interested parties . Employees are evaluated fairly. Companies focus on tangible results and performance as a measure of success . Fissan has been a leader in Japan ith moving a ay from the traditional seniority @based compensation system of or! and re ard system to ard achievement . The company even a step further and appreciate the actions that demonstrate the vision of Fissan . Another e"ample eg 2eople Control in Fissan -otor 7 +A 8 5imited 7 F-+A is the sales and mar!eting company responsible for the distribution of all Fissan products in the 3G 8 , the company ill only hire candidates ho have a match ith the company culture . Anthony East ood 7 1avid Clutterbuc! , $;;'8 2ersonnel H +eneral -anager of Fissan -otor 7 +A 8 5imited said , > and the structure should match each other , so e need to recruit people ho e feel suits our culture and structure that empo ered > . As is !no n to have a structure that flate F-+A , each or!er has one and five different !inds of tas!s each other , even overlap . Fot the enactment of the 9ob description in F-+A system ma!es each person has an obligation to or! ithout restriction function . The system or!s so demanding of 2ersonnel to only hire employees ho are capable of the corporate culture alone .

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