Corporate Culture & Change Management
Globalization, increasing technology, changing consumer tastes and changing values have all served to undermine what used to be known as “business as usual”. In today’s business environment of constant change, there is no such concept. Processes, structures, the playing field, the demographics of the target market, everything is in a constant state of change. In the past century, the business environment was fairly stable. Jobs were safe to a great extent and careers were guaranteed. Business plans only required annual adjustments and forecasting was a simple operation. Reeves & Deimier (2011) site the fact that changes in top company industry rankings increased by 12 % up from 2% between 1960 and 2008, as evidence of just how much change is happening in the business environment. Apple, Facebook, Amazon, Research In Motion, Blockbuster, and MySpace are some of the well-known organizations that have felt the impact of change (Safian, 2012). Position and scale are losing significance as companies seek to become experts at “learning how to do new things” (Reeves & Deimier, 2011, p.134).
In order to survive in the current business environment, business operators must accept and embrace change and develop a positive attitude towards it. Safian (2012) quotes Aaron Levie and puts it like this “In this world of constant change, following a single system or model is foolhardy – the companies that succeed will be nimble and ever-changing.” However, change must be managed and it must be managed consistently and strategically. Change Management, by definition, is the process of managing change. HR Magazine (December 2007, p. 1) defines change management as “the systematic approach and application of knowledge, tools and resources to leverage the benefits of change.” Although this technique is applicable to all spheres of life, change management is particularly relevant and necessary in the corporate environment especially during times of drastic changes such as in mergers and acquisitions. Rather than seeing change as a threat, it should be viewed as an opportunity for innovation and improvements in the way things are done. Success in the corporate environment is largely attributable to corporate proficiency at innovating to tackle competition and technological changes with limited resources (Chich-Jen & I-Ming, 2010). While organizations have little control over the external environment and variables such as competition, changing technology and globalization, it is within the organization’s power to shape and influence their own internal corporate culture. Rather than waste energy worrying about things beyond their control, change managers should spend their efforts building and shaping their desired corporate culture.
Corporate culture plays a vital role in improving competitiveness and is defined as “the leading common values and behaviour in a corporation which is formed in long term management activities, and recognized and abided by all employees” (Chich-Jen & I-Ming,
2010, p. 396). This definition implies that culture is not something that is formed overnight. Neither can it be changed overnight. Managers must consciously consider this reality as they manage change through the management of the corporate culture. Language and informal unwritten rules are additional aspects of corporate culture (Trompenaar & Prud’Homme, 2004) that must be considered in the change management process.
The Challenges of Change Management in Corporate Culture
Change is difficult to manage. One difficulty is the fact that change is a dynamic thing while culture is more static in nature and is not altered by instantaneous efforts. Yet, managers must learn to work with employees, some of who are resistant to change, to achieve business objectives even in a constantly changing, uncertain environment (Trompenaar & Prud’Homme, 2004). HR Magazine advises that Human Resoources’ role in change management should be that of change champion, change facilitator, change designer and change demonstrator. Kotter (1996) believes that ineffective change efforts result in wastage of resources and frustrated and stressed employees while the benefits of effective change management include improved competitiveness, and a promise of better things to come.
Another challenge posed by change management in corporate culture is the existence of several different types of subcultures within the corporate culture of a single organization. These subcultures are formed as a result of commonalities such as position in the organizational chart, work function, division and geographic region (Trompenaar & Prud’Homme, 2004). This means that whatever the approach to change management, it must effectively address the differing subcultures within the organization. According to Trompenaar et al. (2004), the key to succeeding at this lies in the reconciliation of the contrasts among the various subcultures.
Communication can become a challenge during times of change in a corporate setting. Groysberg and Sling (2012) believe that economic, organizational, global, generational and technological changes affect corporate communication. Effective communication is essential to building and maintaining an effective corporate culture and must be given keen attention during times of change within the organization. Since organizations are becoming flatter, the traditional top-down type of communication is losing its effectiveness and leaders and managers must foster two way communication between management and staff (Groysberg and Sling, 2012). Firstly, managers must communicate in such a way that employees will buy into any proposed change because of trust and credibility. Insurance professionals’ Aetna’s merger efforts succeeded in part due to the fact that the new CEO solicited the views and opinions of staff and involved them in the planning process (Katzenbach, Steffen & Kronley, 2012). Garber (2013) recommends that managers support their employees and serve as a guide for them during times of change.
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- University of Cambridge
- Corporate Culture