Question

GLOBAL BUSINESS AND STRATEGY

Impact of Culture on Business – Deloitte Insights The importance of culture is readily apparent when things go wrong. When two large companies merged last year, for example, it became clear that one company had a culture of “low cost” while the other had a culture of “quality service.” Employees received mixed signals for months until the new management team took the time to carefully diagnose and redefine many business processes throughout the company. Given the importance of culture and the consequences of cultural issues, many companies are proactively defining culture and issuing culture “manifestos.” The Netflix culture presentation, often used as an example, has been downloaded more than 12 million times since 2009. The presentation clearly describes a culture that combines high expectations with an engaging employee experience: Generous corporate perks such as unlimited vacation, flexible work schedules, and limited supervision balance a strong focus on results with freedom and appreciation for the expected achievement. The financial services industry, still restoring its brand after the 2008 financial crisis, is sharply focused on culture. One organization is using a variety of initiatives to help employees understand “how the bank does business,” including offering speaker series on topics such as compensation packages, customer satisfaction, and maintaining regulatory standards. Citigroup has an entire committee focused on ethics and culture and has implemented a series of web-based videos detailing real workplace ethical dilemmas. Bank of MODULE

America is focusing its corporate culture transformation on encouraging employees to report and escalate issues or concerns, as well as incorporating a risk “boot camp” into their current training. Wells Fargo is increasing its efforts to gather employee survey feedback to understand current trends and potential areas of weakness in its culture. A new industry of culture assessment tools has emerged, enabling companies to diagnose their culture using a variety of well-established models. Yet despite the prevalence of these tools, fewer than 12 percent of companies believe they truly understand their culture. That’s where HR can help. As businesses try to understand and improve their culture, HR’s role is to improve the ability to curate and shape culture actively. An organization’s capabilities to understand and pull the levers of culture change can be refined and strengthened. HR has a natural role to play in both efforts. As operations become more distributed and move to a structure of “networks of teams,” culture serves to bind people together and helps people communicate and collaborate. When managed well, culture can drive execution and ensure business consistency around the world. HR has an opportunity to assume the role of champion, monitor, and communicator of culture across, and even outside, the organization. Once culture is clearly described, it defines who the company hires, who gets promoted, and what behaviours will be rewarded with compensation or promotion. Nordstrom has formed a People Lab Science Team in an effort to define and curate a culture that will attract top talent and enable the retailer to compete with tech companies such as Tableau and Microsoft. The team takes a multidisciplinary approach to designing programs to define and reinforce Nordstrom’s culture. Starbucks analyzed thousands of social media entries to gain an objective view of its culture through the eyes of its employees and take specific actions to reinforce its cultural strengths and address cultural weaknesses. Securitas Belgium has defined the behaviors associated with its vision for culture, performed an analysis of its current state, and developed a detailed, measurable change plan for 150 of its managers. Software giant SAS was recently rated the best place to work by the Great Place to Work Institute. It is also highly successful, with 37 consecutive years of record earnings (it earned $2.8 billion in 2012). SAS has identified trust as a critical cultural attribute and regularly surveys its employees on elements of trust: communication, respect, transparency, and being treated as a human being. Once an organization develops a clear understanding of its culture and decides on a direction for cultural change, it is critical to move rapidly from analysis to action. Moving from talking to doing is the only way to build
momentum.

Question 1) How do you see the cultural transformation for companies in South Africa? Comment.

Question 2) Discuss the role of Religion and Education in modern business transformation with appropriate examples.

Answer 1

Answer to the first question:

Cultural transformation is a kind of concept which is very intangible in nature and that is why difficult to measure, however, the long terms impact of cultural transformation can be seen by measuring the change in the composition of team, cultural diversity, promotion of cultural diversity and being open to change.

Many companies feel that the cultural transformation is critically important, but when it comes to managing the cultural transformation of it becomes very obvious that it is not being managed in many of the African organizations. The public organizations in South Africa are lagging much behind their private counterpart, private companies have shown response to the need for cultural transformation and embraced the changes for the better good.

For example, the South African Airways has secured many consecutive years of losses and now they have realized the importance of cultural transformation for the better bottom line and they have taken the cultural transformation initiatives seriously and acting much faster on the change path.

As the major breakthrough changes some of the private institutions are being included under the public sector units to improve the speed of cultural transformation, for example, Sector Education and Training Authority in South Africa is doing the same with the intention of improving their journey of cultural transformation.

Infact, now South Africa is geared up to lead the sub saharan countries for their cultural transformation journey and they have enough examples that can be replciated.

The whole, joureny has led to increase in investment interest by the multinational organizations in South Africa and the country is ready to reap the benefits of its journey towards the cutlural transformation.