Corporate Culture Change in an Organization
Business firms and organizations have got different ways of operating. The differences are a result of many unique factors and characteristics that play an integral role in the overall operations of the companies. Among these factors are business purpose, location of the organization, government and political factors, size of the company as well as the overall corporate culture. Companies may take up ownership of other companies, or join to form one large and expanded organization, in a process generally referred to as merger and acquisition. Reasons for merger and acquisition may include financial constraints in one company and the need to increase the competitiveness of the companies. Corporate culture will be an integral part of the successful merger between the American Internet Technology Company and the Canadian Social Media Company. A positive corporate culture translates into happy and enthusiastic employees who then blend well with the organization’s mission and vision. One of the most significant factors that can guarantee effective merger and acquisition process is corporate culture; the combination of principles and conducts which dictate how a given organization’s management and workers respond to and handle external business relations.
Critical Factors in Improving Company Culture
Corporate culture, a vital tool for the success of any given firm, needs to be well established; it should also be one that promotes excellence and proper employee welfare. According to Hickma & Silva (2018), a good company culture translates into an optimum working environment, bringing the best out of all the employees and the stakeholders. Among the vital factors in improving company culture is the creation of a vision for the future, the development of a model for change, and rewarding changes (Hickma & Silva, 2018).
Creation of a Vision for the Future
Organizations are established to serve and accomplish a specific purpose. The purpose may be business-related or not. Nonetheless, there must be a particular goal that has to be achieved. Every stakeholder within the organization has to work towards achieving the set goal. The creation of a vision for the future is vital in the company; not only does it help in articulating the sole purpose of the organization, but it also provides a unique path to be followed by all the stakeholders (Martin, 2018). Employees need to be aware of the corporation’s vision, what the firm’s future goals are, and how they (employees) will be vital in the realization of the overall goal. This way, the employees are aware of their role and will be able to work, and even in some instances, offer their advice on the best ways through which the goals can be achieved.
The best way a company can generate a vision for the future is by having a clear mission and vision statements (Martin, 2018). A mission statement expresses why the organization exists. On the other hand, a vision statement provides guidelines on where the organization is headed to; it provides a ‘path’ that should be followed to achieve that which is expressed in the mission statement (Uhl & Gollenia, 2016). Thus, having a clear and well thought out mission and vision statements provides everyone with a clear vision for the future. This way, all the stakeholders are aware of the company’s progress and their roles in achieving the set goals and standards.
Development of a Model for Change
Communication is an essential tool for effective management. It is a key factor which not only provides a path towards teamwork and effective relations; it also makes sure that everyone at the workplace is aware of all the proceedings within the organization. If a company is considering mega changes, such as merger and acquisition, every employee has the right to be informed and psychologically prepared (Martin, 2018). They need to be aware of the consequences of such changes. Proper change management helps organizations to stay within their budget lines and avoid huge losses. To better navigate the challenges that come about with massive changes, organizations can adopt a useful model for change. The seven proven change management models are the Lewin’s model, McKinsey’s 7S model, Kotter’s philosophy, Nudge philosophy, ADKAR model, Bridges’ change model, as well as the Kubler-Rose five step model (Hayes, 2018).
Considering the two business organizations under discussion, the McKinsey’s 7S model suits their situation better. The 7S under this model are “strategy, structure, systems, shared values, style, staff, and skills” (Zincir & Tunç, 2017). This model takes into consideration key players who need not be overlooked during change: the employees. Additionally, under this model, firms entering into -mergers are supposed to have shared values, an essential factor in keeping all the employees and stakeholders together before, during, and after the merger process (Zincir & Tunç, 2017).
Rewarding Changes
Today’s world has seen a lot of changes in all aspects of life. Most of the changes have occurred in areas such or technology, management, and the environment. Thus, to effectively sustain their operations and performance brilliance, organizations have to endlessly respond and adapt to the fluctuating environmental demands (Hayes,2018). Firms that are undertaking change initiatives must engage employees; they play a crucial role in the progress of any given organization. Change is inevitable, and as such, everyone has got to prepare for it. The changes, if well undertaken and communicated, will be rewarding.
In navigating major changes within firms, rewards are an essential way through which employees can be kept motivated and enthusiastic (Hayes,2018). Companies can reward employees in very many ways. Rewards keep the employees motivated. Moreover, the employees will be able to have a positive approach towards the anticipated changes, making sure to be part of the changes through innovation and excellence. The expectancy theory notes that individuals are rational decision-makers who think about their deeds and act in a manner that satisfies these needs while helping them achieve their goals (Hayes,2018). Thus, employees, in a bid to remain relevant and vital to the organization, will be open to the idea of change, making sure to give their best. The reward for this change is being promoted or retained in the event of a merger. Because companies get their preferred employees’ behavior and performance, companies that desire to perform well and change commendably are required to adopt schemes that reward both performance and change (Uhl & Gollenia, 2016).
Challenges in Plan Implementation
Implementation of change is not an easy process. In situations such as company mergers and acquisitions, a lot of challenges are bound to be experienced. Among the problems encountered in implementing change within organizations include the following: organizational resistance, unavailability of pre-established goals, lack of strategy alignment, and underestimation of the need for change (Hayes,2018).
Change has to be anticipated, communicated, and embraced in a well-thought-out manner; it should not be abrupt. A common mistake most managers make during transition is the underestimation of the need for change (Hayes,2018). Organizations need to think and prepare for the change process, taking note of all possible challenges and then outlining the mitigation steps. However, when this is not done, then the chances of failure of the change process are high. Organizational resistance is another challenge in the change process. In this case, resistance may come from one of the two companies, either the American-based or the Canadian-based, most likely due to inadequate information. Unavailability of pre-established goals and lack of strategic alignment are management-related challenges. Before making changes within the organization, the management needs to re-examine its previous targets, prepare new and realistic ones, and then re-establish clear, adaptable, and practical strategies (Hayes,2018).
Tools in Managing Corporate Culture Change
Corporate culture, a critical success factor in any given organization, needs to be managed properly, making sure to maintain the organizational setup, vision, and mission during changes. When corporate culture is adversely affected, production at the workplace is significantly affected; employee morale falls, pressure on the management increases, and the overall decision-making process is negatively affected (Uhl & Gollenia, 2016). Thus, the proper corporate culture management process is vital during the organizational change process. Three essential tools can help in the appropriate management of corporate culture change. These three are information, support, and resources.
Proper information is very vital in corporate culture change. Information generally entails communication, data handling, and a survey of the general work environment in a manner that aims to support all the processes within the organization (Uhl & Gollenia, 2016). Effective communication is an integral part of proper management. A good corporate culture in any given organization has got proper communication protocols as one of its key elements. All the stakeholders with the company need to be aware of all the activities in the workplace. Through communication, employees and employers built trust in each other (Uhl & Gollenia, 2016).
Additionally, suitable communication protocols mean that everyone can express themselves without fear. In a situation where changes are anticipated, information sharing is essential. Transitions are supposed to be communicated in advance. Moreover, information regarding the status of every employee and stakeholder after the change is vital. This keeps everyone prepared hence facilitating a smooth change process.
Support is another vital tool during corporate culture change. Administrative sustenance for individuals is the level to which a particular firm provides the means, reinforcement, communication, and reassurance to enable all the stakeholders to improve their living and welfare, especially during organizational changes (Hickma & Silva, 2018). When corporate culture change happens, the entire ‘ecosystem’ within and outside the organization has to be supportive. If the support does not occur, then change either will not happen or will not be sustainable at all. Organizations are not only supposed to communicate impending changes early enough but are also under the responsibility to prepare a realistic and feasible support plan for every stakeholder. This way, every staff will feel valued and important to the change process; they will be assured of their welfare even after the changes (Hickma & Silva, 2018).
The third most important tool in managing corporate culture change is resources. Resources within the organization are supposed to be harnessed properly, both for the overall development within the organization as well as for the successful facilitation of the corporate culture (Hickma & Silva, 2018). Among the resources vital during corporate cultural change are human resources, financial resources, and information resources. Human resource is the most basic type of resource in an organization. This involves the management and overall staff. Each of them has got a unique role being played in the organization. They are responsible for the whole decision-making process; they also organize the other resources for optimum performance. During corporate culture change, proper management and decision-making are required. Financial resources need to be managed in a way that the organizations do not incur losses during the transition. On the other hand, information resources are vital in providing data on expected outcomes of the corporate culture change (Hickma & Silva, 2018).
Conclusion
Corporate culture involves all the values, ethics, and principles which govern a particular organization in its daily activities. Vital elements in improving business culture are the creation of a vision for the future, development of a model for change, and rewarding changes. Corporate culture change in an organization has to be done in a manner that is acceptable and favorable to all the stakeholders. Challenges in the implementation of corporate culture change include organizational resistance, unavailability of pre-established goals, lack of strategy alignment, and underestimation of the need for change. Three essential tools can help in the proper management of corporate culture change: – information, support, and resources. In situations where two or more companies are entering into merger and acquisition, there need to be compatibility of values and sound corporate culture. Moreover, the goals, mission, and vision of the resulting merger need to be clear and realistic. The ethical guidelines and moral principles should be upheld, taking into account every stakeholder’s welfare, especially employees.
References
Hayes, J. (2018). The theory and practice of change management. Palgrave.
Hickman, C. R., & Silva, M. A. (2018). Creating excellence: Managing corporate culture, strategy, and change in the new age. Routledge.
Martin, R. (2018). Managing Change: Corporate Culture Change Of Heinz.
Uhl, A., & Gollenia, L. A. (Eds.). (2016). A handbook of business transformation management methodology. Routledge.
Zincir, O., & Tunç, A. Ö. (2017). An Imagination of Organizations in the Future: Rethinking McKinsey’s 7S model. In Strategic Imperatives and Core Competencies in the Era of Robotics and Artificial Intelligence (pp. 101-125). IGI Global.