7–1 Organization The External Environment Mega or General Environment Task or Specific Environment The Organization SuppliersCustomers Public Pressure Groups Competitors

7–2 Organization The Mega Environment Technological elementEconomic element International element Legal – Political element Socio cultural element The Organization

7–3 Organization The Task Environment The Employment Market Customers / Clients Public Pressure Groups Suppliers Government Regulators Competitors The Organization

7–4 Organization The Task Environment Major elements; 1.Customers and Clients Individual and organizations purchasing products / services. 2.Competitors Other organizations either offering ( or a high potential of offering ) rival products / services (Restaurants, Hotels). 3.Suppliers Organizations and individuals supplying resources an organization needs to conduct its operations.

7–5 Organization The Task Environment 4.Labor Supply Individuals potentially employable by an organization. 5.Government Agencies Agencies providing services monitoring compliance with laws and regulations at local, State or regional and national levels (Environmental Laws, Labor Laws, Social Security).

7–6 Organization Competitive Forces in the Task Environment Rivalry among existing forms in industry Buyers bargaining power Threat of new Competitors Suppliers bargaining power Threats of substitute goods/services

7–7 Organization Internal Environment Nature of organization culture A system of shared values, assumptions, beliefs and norms uniting organizational members The way we do things around here. The “glue” binding all the parts (or the oil that keeps them moving).

7–8 Organization The organization’s Culture A system of shared meanings and beliefs held by organizational members.  Implications:  Culture is a perception.  Culture is shared.  Culture is descriptive (Complaint culture, Shouting culture, Disturb Culture)

7–9 Organizational Culture Sources of Organizational Culture  The organization’s founder  Vision and mission  Past practices of the organization  The way things have been done  The behavior of top management Continuation of the Organizational Culture  Recruitment of like-minded employees who “fit”  Socialization of new employees to help them adapt to the culture

7–10 Organizational Culture How Employees Learn Culture Stories  Narratives of significant events or actions of people that convey the spirit of the organization Rituals  Repetitive sequences of activities that express and reinforce the values of the organization Material Symbols  Physical assets distinguishing the organization Language  Acronyms and jargon of terms, phrases, and word meanings specific to an organization

7–11 Organizational Culture Stakeholder Relationships Stakeholders  Any constituencies in the organization’s external environment that are affected by the organization’s decisions and actions Why Manage Stakeholder Relationships?  It can lead to improved organizational performance.  It’s the “right” thing to do given the interdependence of the organization and its external stakeholders.

7–12 Managing Stakeholder Relationships 1.Identify the organization’s external stakeholders. 2.Determine the particular interests and concerns of the external stakeholders. 3.Decide how critical each external stakeholder is to the organization. 4.Determine how to manage each individual external stakeholder relationship.

7–13 Organization Organizational Stakeholders Unions Employees Organization Shareholders Communities Suppliers Media Customers Social and Political Action Groups Competitors Trade and Industry Associations Governments

7–14 Stake holder's Concern Stake holder Group Owners and Investors Examples of concerns Financial Soundness Consistency in meeting stake holder expectations Sustained profitability Average return on assets Timely and accurate disclosure of financial information

7–15 Stake holder's Concern Stake holder Group Customers Examples of concerns Product / service quality, and availability Responsible management of defective or harmful products / services Safety records for products / services Pricing policies and practices Honest, accurate and responsible advertising

7–16 Stake holder's Concern Stake holder Group Employees Examples of concerns Nondiscriminatory, merit- based hiring and promotion Diversity of workforce Wage and salary levels and equitable distributions Availability of training and development Workplace safety and privacy

7–17 Stake holder's Concern Stake holder Group Community Examples of concerns Environmental issues Environmental sensitivity in packaging and product design Recycling efforts and use of recycled materials Pollution prevention Global application of environmental standards

7–18 Organization’s Social Responsibility The obligation of an organization to seek actions protecting and improving society’s welfare along with its own interests.

7–19 Organizational Culture Factors Influencing the Strength of Culture  Size of the organization  Age of the organization  Rate of employee turnover  Strength of the original culture  Clarity of cultural values and beliefs

7–20 Organizational Culture Benefits of a Strong Culture Creates a stronger employee commitment to the organization. Aids in the recruitment and socialization of new employees. Fosters higher organizational performance by instilling and promoting employee initiative.

7–21 Organizational Culture Ethical Guidelines for Managers 1.Obey the law 2.Tell the truth 3.Show respect for people

7–22 Organizational Culture Creating an Ethical Culture  High in risk tolerance  Low to moderate aggressiveness  Focus on means as well as outcomes Creating an Innovative Culture  Challenge and involvement  Freedom  Trust and openness  Idea time  Playfulness/humor  Conflict resolution  Debates  Risk-taking

7–23 Organizational Culture Creating a Customer-Responsive Culture  Hiring the right type of employees (ones with a strong interest in serving customers)  Having few rigid rules, procedures, and regulations  Using widespread empowerment of employees  Having good listening skills in relating to customers’ messages  Providing role clarity to employees to reduce ambiguity and conflict and increase job satisfaction  Having conscientious, caring employees willing to take initiative

7–24 Spirituality and Organizational Culture Workplace Spirituality  The recognition that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of community. Characteristics of a Spiritual Organization  Strong sense of purpose  Focus on individual development  Trust and openness  Employee empowerment  Toleration of employees’ expression

7–25 Benefits of Spirituality Improved employee productivity Reduction of employee turnover Stronger organizational performance Increased creativity Increased employee satisfaction Increased team performance Increased organizational performance

7–26 How Culture Affects Managers Cultural Constraints on Managers  Whatever managerial actions the organization recognizes as proper or improper on its behalf  Whatever organizational activities the organization values and encourages  The overall strength or weakness of the organizational culture Simple rule for getting ahead in an organization: Find out what the organization rewards and do those things.