Peter Drucker famously said that “Culture eats strategy for breakfast!” Do you agree that organisational culture is the most important critical factor in sustained organisational effectiveness?

Introduction:

Despite early achievement relies upon the extension and sort of ventures expected to update obtained organizational effectiveness, paying attention to organizational culture is proven indispensable. As famous Peter Drucker said "Culture eats strategy for breakfast!", he knew the fact that any association in which fail to connect its strategy to workplace culture is prepared to put the organization at risk (Fifer & Joseph, 2018). Organizational culture is described as a set of convictions, values, and assumptions shared by an organization's members (Berson et al., 2008). These fundamental values affect the conduct of individuals within the group as they will depend on these values to guide their choices and actions (Gregory et al., 2019). I agree with the statement of Mr. Drucker that culture is one of the most crucial factors contributes to the success of the organization. Therefore, strategies should be efficient to adapt and align themselves with culture otherwise they can not be implemented. This assignment will focus on the role of organizational culture to achieve desirable outcomes. To begin with, several assumptions about the relationships between culture and strategy will be shown. Then, the importance of culture within the workplace will be proven via a couple of researches, but the major part is through the competing value framework (CVF). Finally, the paper will conclude via the role of workplace culture in sustained firm's competitive advantages.

Assumptions about the relationships between culture and strategy:

As pointed above, there are schools of thoughts over the relation between workplace culture and strategy. On the one hand, some authors consider the concepts to be synonymous. For instance, Bate (1994, p.33) (as cited in Baird, et al., 2007), state that "cultures do not have strategies; they are the ways and means an organization or society has developed to cope with the basic life problems relating to its survival and growth". On the other hand, others see culture and strategy as two distinct notions and argue that there must be a specific link between them. While Saffold's (1998) opinion was that strategies are generated as products shaped by organizational culture, Joyce and Slocym (1990) (as cited in Baird, 2007) alternatively retain that an organization's strategy may eventually affect culture. In reality, a company, to be well-constructed, need to create effective alignment between their strategies and the corporate culture.

The importance to align strategy with culture in the workplace:

Everything within the organization work with each other. A normal company can not operate separately with only one department, it has to consist of Marketing, Human Resource, IT, Finance, etc. The same goes for two concepts being mentioned. Strategies can not remain solitary, it needs to base on and fit the culture of the organization. As Colin Angle, Co-founder of iRobot said "culture is the magic start-up ingredient", it is essential to know the culture of a company, especially in the context of business strategy (Mohelska & Sokolova, 2015). As a consequence, based on the sort of workplace culture, a specific strategy will be more prominent and suitable than others (Bititci et al., 2006).

Different methods analyze the relationship between the two concepts:

Since the topic of organizational culture receives attention in the 1980s (Ostroff et al., 2003; as cited in Hartnell et al., 2011), Several approaches have been identified over years to measure the link between effectiveness level of the company and organisational culture, each presenting a specific research agenda by measuring the values and behavioral norms (Cooke & Rousseau, 1988). Kotrba (2012) stated that the Denison model has been used to conceptualizes culture along four dimensions: consistency, mission, adaptability, and involvement in investigating the relationship between workplace culture and organizational performance. In details, the model favors low variability in the perceptions of organizational members. However, it still has its limitation when facing flexibility in the future cultural changes and is said to only address how the culture at a specific point in time concerning organizational outcome over a couple of years. Since the appearance of technological evolution, several up-and-downs within organizations have been witnessed. Consequently, the CVF has also been used to assist managers to overcome these threats as it will provide empirically support to help them in the social abilities expected to remain applicable and viable amid new organizational realities (Tong & Arvey, 2015).

Identify organizational culture through the CVF:

According to the CVF, workplace culture was shaped into four types, which are Clan, Adhocracy, Market, and Hierarchy (Gupta, 2011). Thus, three of these cultures, albeit with empirical findings and related organizational processes and outcomes were used to test on three classifications of the effectiveness criteria, namely Employee Attitudes, Operational effectiveness, and Financial effectiveness. Following the research, four specific hypotheses have been tested to examine the underlying assumptions about the connection between culture types and organizational effectiveness.

Hartnell's hypotheses using the CVF:

Testing on three out of four types of culture, namely market, adhocracy and clan, the meta-analysis comes up with four assumptions to paint a more nuanced picture of the association between organizational culture and desired effectiveness (Hartnell et al., 2011). The first hypothesis states that clan culture has a fundamentally more grounded positive association with unit-level representative frames of mind than do adhocracy and market cultures. In reality, clan culture is a stronger positive relationship with employment fulfillment and responsibility rather than with unit-level employee attitudes. The second hypothesis assumes there is a close relationship between adhocracy cultures and innovation in comparison to clan and market culture. However, the research found out the positive link close between innovation and market, adhocracy culture rather than clan culture. The following hypothesis expects the significantly stronger positive relationship in the link between market cultures and quality of products and services rather than do clan and adhocracy cultures. Although the assumption was confirmed for adhocracy type, it would not do the same for clan culture (clan cultures have a considerably larger influence on the quality of product and services). Finally, hypothesis 4 was said to be true when it assumes that the relationship between market types and financial effectiveness is extremely stronger than the other two cultures when examining subjective monetary criteria but received mixed support when the two objective measures were considered.

Result of Hartnell's research via the CVF:

In general, the CVF proposes that culture types comprise of a blend of the association's concentration and structure. Hence, they create their own sets of behaviors, values, beliefs, and assumption that attract the organization's attention and exertion to achieve particular authoritative finishes. The framework finally suggests that culture types rely upon unique organizational effectiveness indicators as a component of their fundamental suppositions, values, and structures (Hartnell et al., 2011), although there are some remaining limitations which resulted in the exclusion of multiple studies due to the wrong level of analysis, limited number of culture types, etc, it is undeniable that the meta-analytic has helped to approach organizational culture as a set of beliefs, values, norms, and behaviors which sheds extra understanding into the complex social phenomenon.

Role of organizational culture in sustained above-normal advantages:

It is suggested for a firm to give out competitive advantage, and more important, being a source of sustained superior financial outcome, must meet three conditions of valuable (empower a firm to get things done and behave in manners that lead to high deals, low costs, etc to get positive economic performance), rare (possess elements and behaviors in which to be unique compared to their rivals), and finally imperfectly imitable ( firms try to imitate these cultures will experience a plenty of disadvantages) (Barney, 1986). Following the article, the firms without these characteristics seem unlikely to obtain a competitive advantage for these two reasons. Firstly, in the case of that firms are emulating the valuable culture of their opponents, at that point regardless of whether they are fruitful at changing its culture, that altered culture will just empower it to do the things that the firm it is imitating already does. Such successful imitation does not give a firm an advantage over the others but may suggest making that firm less ‘rare" in comparison to its original version. Secondly, if that firm can consciously deal with its culture to alter and boost its value, hence different firms additionally are likely to change their cultures in this manner. In this circumstance, only firms that succeed in managing the modifications in their cultures, which results in imitations, can obtain a competitive advantage. On the other hand, firms with these cultural attributes (valuable, rare and imperfectly imitable) are recommended to apply the method of "stick to their knitting", in other words, continuing to follow what has been done and do not try to do things that have little experience on (Peter & Waterman, 1982; as cited in Barney, 1986). Subsequently, the implementation can assist to nurture and develop competitive strength, hence pave the wave for the company to generate above-normal net economic returns.

Conclusion:

In sum, workplace culture and strategy are significantly interrelated. It is commonly acknowledged that once the association change methodology, it must adjust culture to the procedure, or face practically certain vital disappointment (Gupta, 2011). The two concepts are both essential however culture is enduring while strategy is temporary, hence culture is difficult to mirror. However, the culture should be adaptable for an organization to follow effectively.