Understanding Management Chapter 2: The Environment and Corporate Culture

organizational environment
consisting of both general and task environments, includes all elements existing outside the boundary of the organization that have the potential to affect the organization
organizational ecosystem
includes organizations in all the sectors of the task and general environments that provide the resource and information transactions, flows, and linkages necessary for an organization to thrive
general environment
indirectly influences all organizations within an industry and includes five dimensions
task environment
includes the sectors that conduct day-to-day transactions with the organization and directly influence its basic operations and performance
international dimension
of the external environment represents events originating in foreign countries, as well as opportunities for U.S. companies in other countries
technological dimension
of the general environment includes scientific and technological advances in society
sociocultural dimension
includes demographic characteristics, norms, customs, and values of a population within which the organization operates
economic dimension
represents the general economic health of the country or region in which the organization operates
legal-political dimension
includes government regulations at the local, state, and federal levels, as well as political activities designed to influence company behavior
internal environment
includes elements within the organization’s boundaries, such as employees, management, and corporate culture
natural dimension
includes all elements that occur naturally on Earth, including plants, animals, rocks, and natural resources such as air, water, and climate
are part of the task environment and include people and organizations that acquire goods or services from the organization
are organizations within the same industry or type of business that vie for the same set of customer
Traditional stores such as
Target and Walmart are competing with online retailers such as Amazon and Zappos
provide the raw materials the organization uses to produce its output
labor market
represents the people available for hire by the organization
When external factors change rapidly
the organization experiences high uncertaint
Strategic issues
are events and forces that alter an organization’s ability to achieve its goals. As environmental turbulence increases, strategic issues emerge more frequently
Boundary-spanning roles
link to and coordinate the organization with key elements in the external environment
Interorganizational partnerships
reduce boundaries and increase collaboration with other organizations
occurs when two or more organizations combine to become one
joint venture
is a strategic alliance or program by two or more organizations
Sikorsky Aircraft and Lockheed Martin
teamed up to bid on a new contract for Marine One helicopters
is the set of key values, beliefs, understandings, and norms shared by members of an organization
is an object, act, or event that conveys meaning to others
is a narrative based on true events and is repeated frequently and shared among organizational employees
is a figure who exemplifies the deeds, character, and attributes of a strong culture
Steve Jobs is a
hero at Apple, representing the creativity, risk taking, and striving for excellence that define the company’s culture
such as Disney’s “The happiest place on earth,” succinctly expresses a key corporate value
planned activities at special events, to reinforce company values
For an organization to be effective
corporate culture should be aligned with organizational strategy and the needs of the external environment
Organizations within the same industry often
reveal similar cultural characteristics because they are operating in similar environments
adaptability culture
is characterized by values that support the company’s ability to interpret and translate signals from the environment into new behavior responses
achievement culture
is a results-oriented culture that values competitiveness, personal initiative, and achievement
involvement culture
A culture that places high value on meeting the needs of employees and values cooperation and equality is an
consistency culture
values and rewards a methodical, rational, orderly way of doing things
high-performance culture
Managers emphasize both values and business results to create a
Culture enables solid business performance through
Culture enables solid business performance through
cultural leadership
Managers create and sustain adaptive high-performance cultures through
Cultural leaders
define and articulate important values that are tied to a clear and compelling mission, which they communicate widely and uphold through their actions