What is an organization?
An Organization is a group of people working together in the form of an organized manner for a common cause. It is a social unit which consist of people which is structured and managed to meet the needs and track goals which are collective. The people in an organization are prone to work together to achieve the objectives and goals of the organization within an environment.
What is an Organizational behavior?
Organizational Behaviors understands the impact of people, groups and structures on human behavior which exists inside an organization. It is related to areas such as Anthropology and communication. The organization behavior is split into organizational culture, power and politics.
The company selected for this task is Nestle.
https://www.environmentalleader.com/2018/04/nestle-aims-for-100-recyclable-or-reusable-packaging-by-2025/. Accessed 04 November 2018.
Nestlé is one of the largest companies dealing in foods and beverages. It was established in Switzerland in 1905 and got foundation from Anglo-Swiss Condensed Milk Company. Henri Nestlé, George Page and Charles Page are the originators of Nestlé. Nestlé makes diverse sorts of products and items such as baby foods, bottled water, Coffee, Diary, Drinks, Ice-cream, Healthcare products, Petcare etc. a few of its Brand names are Wellness, Nesquik Cereal, Nescafé, Kit Kat. Paul Bulcke is the pioneer of Board of Chiefs in Nestlé.
What is an Organizational Culture?
An Organizational culture can be defined as the system where the values, beliefs, ethics and cultural ethnicity governs how the people in an organization behaves to each other and overall as a team. Every organization has their own unique culture which helps the employees to maintain the guidelines for the behavior of the employees in the company.
Example: Google has created a creative and innovative culture at their headquarters in California with an android googleplex, bikes, and bringing your dog to work.
Types of Organizational cultures:-
There are 4 types of Organizational Culture – Clan Culture, Adhocracy Culture, Market Culture, Hierarchy Culture.
? Clan Culture: A clan culture is a family-like or type of corporate environment which indicate unity, common goals and value. There is loyalty among the workers in this organization.
? Adhocracy Culture: In this type of culture, the employees are very creative and are able to take risk. The leaders really look forward to innovate and conduct experiment to launch new products. Voluntary help from the workers and contribution from them are really encouraged in this type of organizational culture.
? Market Culture: Competition is the bases for this type of organization. This is often a result based organization that emphasize on getting things done. Here people are focused on their goals and objectives. In this organization, the element of competition keeps the organization together.
? Hierarchy Culture: It is a type of Organizational in which things ae ranked according importance i.e.; in levels. This is in a form of a structured work environment. In this environment hierarchy depends upon the rules, top-down management to control and guide business activities and practices. Leaders give orders to their sub-ordinates and are proud of them.
Types of Organizational culture models:-
The Organizational Culture model is divided into 3 types – Charles Handy’s Model, Edgar Schein’s Model and Hofstede’s theory.
Charles Handy’s Model:
Charles Handy is known as the God of management. Charles Handy’s model is an improvised model of Roger Harrison. In Charles Handy’s model of organisational culture, there are four components. They are:
? Individual or Person
These 4 cultures includes the company’s history, ownership, organizational structure, business environment etc. the diagrammatic explanation of these 4 cultures are listed below:
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In power culture, the power is held by only some people and is concentrated among few people who are at higher level and close to the central management and is the strongest culture. In this type of culture, decisions are made quickly. Employees are guided to finish their work in presence of few rules and regulations which are to be followed. The employees are likely to be motivated by financial rewards and bonuses which are provided to them. This means that the closer they are to the centre, the more power they possess.
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Roles play a very critical part in the organizational culture. Each employee have a clear defined job, they understand their roles and responsibilities as there is high control within the organization. The power of the person comes from the position that they sit on. Role culture is a tall hierarchical and bureaucratic organization structure, but in this culture decision making is a slow process due to the decisions from the managers at the top most level.
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In this culture, the members of the organization are built together in an order to value cooperation and team work. The teams are formed in order to perform and function a certain and critical problem. The interaction and communication between the employees follows a pattern which is dual reporting. The organization expects from its employees to help each other in achieving certain goals. In this culture, different specialization areas help the employees to achieve the goals which encourages team spirit. The plus point of this is that the employees are motivated due to the creative and motivating environment that they are working in. Connections among the employees is very strong.
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This is often a culture where employees are given freedom to make their choices and show progress in the form of results. The association doesn’t value how their employees do it, they are just concerned about the beneficial results from them. This is where an employee can show out their capabilities and polish themselves. There is no sign of any teamwork in this type of culture. The employees only look forward for money and don’t even bother to get familiar to the office environment. The organization only works to serve people working there and are bothered about themselves. Power in this culture is decided by a person’s position within the organization.
Edgar Schein’s Model:
Edgar Schein’s refined an organization culture model to make culture more clearly in an organization which relate to both direct and indirect devices in an organization. He also formulated and indicated what necessary steps are to be taken to bring culture change. The direct system includes status, opinions and behavior. Indirect system includes the mission and vision statement of the company, guidelines and rituals. This model is also known as “Onion Model”.
Edgar Schein’s model has 3 elements:-
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Artifacts and symbols:
These are the physical components which are visible to anyone. These includes the Infrastructure of the Organization, Dress Code, Languages, and Facilities. These can be defined as the symbols of culture which are present in the physical environment. Artifacts are the most obvious elements in an organization.
They are the beliefs and attitudes in an organization. Its represents the strategies, objectives and philosophies of an organization. They are the invisible elements of an organization.
The assumptions are the beleifs which are held so deeply in an organisation. You can say that they are the basic foundation in an organization’s structure. Assumptions guide the employees of an organization’s structure. They are always unnoticed but have the most impact on the organizational culture as it is the bais of creativity of the employees.
Professor Geert Hofstede, a social psychologist conducted a research on a large scale which consisted over 100,000 questionnaires over 70 countries. He picked IBM as his base of operation for the research. As a result of this large scale analysis, Professor Hofstede with the help of Gert Jan Hofstede, Michael Minkov and his research team put forth the Six Dimension of Culture.
He defined the organizational culture into 6 dimension which keeps on revolving around the cross-communication in the organization. It also shows the relationship between different values and beliefs and helps a manager to understand the international business market.
The six dimensions are as follows:
? Power Distance Index (PDI): This indicates that the power is unequally distributed within the organization. When there is acceptance in the society for inequality and hierarchal distribution of power then there is high Power Distance Index. Example: High power distance countries are more autocratic, low power distance countries are more democratic.
? Individualism VS Collectivism (IDV): It mainly reflects the priority given to personal independence over the group. In individualism, the personal goals are given more importance and people become self-absorbent. In collectivism, the group goals are given more importance and are asked to work along the group with coordination and cooperation. People in a community are supposed to be loyal and caring towards their group.
? Masculinity VS Femininity (MAS): It shows distribution of values and responsibility among the male and female gender. This is also knows as “Tough versus Tender”. It is the distribution of emotional roles between genders. Masculine cultures are competitive, assertive; feminine cultures place more value on relationships and life issues. In masculine societies, the roles tend to be less comparative between men and women. In feminine societies, however,
There is less overlapping between male and femaleroles and modesty is received as an advantage.
? Uncertainty Avoidance Index (UAI): This dimension describes how well people can cope up with anxiety. In the societies which consists of avoidance, people do make life as fortunate and controllable as possible in any way. If they find that they can’t control their own lives, they further do not try at all. In this dimension people take risk and have the confidence to face the consequences of their actions.
? Pragmatic Versus Normative (PRA): This dimension was added recently and it shows the individuals level towards strong nationalism and religion belief. It is also known as ‘Long-Term Orientation’. It is also known as society of time horizon. Long term oriented societies are focusing on the future and savings. Whereas, short term oriented societies are focusing to the present and the past, giving cooperationin social relations and the fulfilling of social obligations.
? Indulgence Versus Restraint (IVR): It represents the satisfaction of people regarding their life and how they have fun. Indulgence stands for a society that allows relatively free of basic and natural human desires related to enjoying life and having fun. Restraint stands for a society that controls gratification of needs and regulates it by means of strict social norms. The one with more power exercise it when someone shows any resistance.
Influence of Organization Culture on Nestle:
Nestle have a decentralized organization structure which is divided into many sort of groups. Their main headquarters instructs them in the form of guidelines and strategies which are to be followed. The mission of the company is very strong along with their values and inter-personal relations.
Nestle goes after Corporate Ethical Culture, the employees are instructed through training and innovation programs. Man force and Work balance is considered highly important. The employees in the organization are lifted and encouraged to work hard with high coordination and corporation among the employees to achieve the goals.
The Corporate principle appears that the individuals are concerned about other individuals. The corporate code of conduct is simple, the trade-mark shows that “Good Nourishment, Great Life”. Corporate culture appears to show that how the company’s effort energizes the way of life by such things like designing modern and healthy tasty food.
The importance of culture:
Nestle being a sales oriented company, focuses more on earning profit, sense of responsibilities in its member. Each and every member is aware of his/her roles, responsibility and privileges in the company. A better work culture will help to understand behavior attitude, motivating the employees etc.
The dimension of culture at Nestle:
According to a survey which was recently conducted, it was found that employees are not much indulged to take risk and the number of innovators in nestle are also less. This is why the company took an initiative to start giving extra importance to its employees which results were looked forward by the managers. The management highlight team orientation is responsible for maintaining the stability of Nestle.
The Culture followed by nestle are “Ethical policy and business principle”. This culture shows the standard and nature of the firm or company which is ethical. Human capital is increased by practice of business which consists good decision making and corporate culture which are valued and encouraged for the people.
Influence of Organizational Culture on team behavior and performance:
Nestle being an expansive organization have a particularly stable culture. The responsibility takers in Nestle are very much talented and talented. Having a decent culture and a good group of expertise will hugely affect the company or organization.
The leaders of the group will help in preparing its team members so that they efficiently work for the association so that the productivity of the organization can be accomplished. Nestle follows “open door policy”.
Influence of Organizational Culture on individuals:
Nestle has taken an initiative for their workers and employees to contribute their valuable experience and involvement in the organization so that the working of the organization can be increased and expanded. Nestle keeps a check to make sure that the workplace is good and comforting for the employees which in result helps the employees to demonstrate their ability and talent.
Nestle pursues “Human right and labor right law” and hence gives all the employees equal right in all aspects.
The company though focuses on employees betterment may not be able to focus on the innovation of new products. The Corporate culture only gives importance to human force and not to other resources which are required for achieving the profit and goal of an organization.
It is the ownership of power and authority delegated to a person over the people in the workplace. The power can have either positive or negative impacts in an organization depending upon how a designated person uses it. The classification of power was established by an American sociologists John French and Bertram Raven who created a list of five types of social power that affects relationships in the year 1959.
These 5 classifications are – Legitimate power, Expert power, Referent power, Coercive power and Reward power.
It is the power of a person who holds in an organization. This type of power is also known as “Positional Power”. A person only uses this power when he earns it like the CEO of a company.
In Nestle, the legitimate power is usually with the CEO and then he is the one who hire other people and give them power to coordinate people and achieve the organizational goal.
This is a type of power when a person having special kind of knowledge or skills in a particular field. This help the employees to take necessary steps to tackle major problems. Those with advanced skills are respected than those with less experience in the field.
This power is acquired when a person enjoys being around a person or even desire to be like them. This people influence others because people are eager to give them what they want just because there is an element of respect between them. This power comes into act when a person respects another due to inter relation between them.
Nestle has different people coming from different cultural backgrounds who work under one roof with harmony. They lift and help each other in achieving their personal skills. Motivation plays a vital role in this power.
This power is exercised when a leader is able to control other people through punishments or threats to manipulate the behavior of the work. A manager can force his employees to work for extra-long hours to meet the deadline of a particular project. This power helps to make sure that the employees are doing their work responsibly in an organization.
Nestle permits their managers to have a control on the employees in order to keep them on the right path. The manager can use coercive power if his staff is not working according to the code of conduct of the organization. Improper use of this power leads to chaos in the company.
This power highlights that a person’s ability used to motivate workers by offering them incentives or rewards to the subordinates. Reward can be in a form of salary, promotion, yearly bonus etc. These type of rewards boosts up the level of the employees which keeps them motivated which in result keeps them indulged in their work.
In Nestle, the managers and leaders gives their employees rewards which keeps them motivated to work harder for the future.