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Keywords Corporate culture, Organizational behaviour, Competitive advantage, Employee relations
Abstract Defines the concept of corporate culture and shows how it affects organizations (both positively and negatively). Corporations that have been successful in establishing and fostering positive cultures are profiled. The authors find that an effective culture must be aligned with employee values and be consistent with the environment in which the organization operates. While it is best to establish a positive culture with which employees can identify during an organization's infancy, it is possible to change an existing culture. Such change is best accomplished by modeling desired behavior at all levels of management and by planning events that foster frequent interaction among cross-functional employees. Concludes that a positive culture can provide a significant competitive advantage.
Introduction
Corporate culture has become an important topic in business primarily during the last two decades. While corporate culture is an intangible concept, it clearly plays a meaningful role in corporations, affecting employees and organizational operations throughout a firm. While culture is not the only determinant of business success or failure, a positive culture can be a significant competitive advantage over organizations with which a firm competes. This paper will review how the concept of corporate culture became popular, define corporate culture, show how it affects real-world organizations (both positively and negatively), and consider ways in which cultural change may be brought about.
The rise of corporate culture
People come from a variety of ethnic backgrounds and cultural heritages, have a variety of personalities, and have been shaped by a diverse range of experiences. When people from diverse backgrounds are brought together in a work environment, these factors will manifest themselves in an infinite variety of ways. Over time a dominant set of norms will emerge, guiding the way in which work is accomplished within the organization. This phenomenon gives rise to the concept of corporate (or organizational) culture. Corporate culture only began to be studied and appreciated in the USA during the last two decades. An influential book entitled Corporate Cultures: The Rites and Rituals of Corporate Life (Deal and Kennedy, 1982) popularized the notion of understanding, establishing, and fostering a positive corporate culture. In less than two decades since the time that this book was published,...