This chapter analyzes the importance of organizational culture through a set of strategies and enterprising practices in order to emphasize the culture’s necessity for the effective management of any organization and especially for the management of telecommunication companies. Moreover, the way culture affects the success and failure of a series of enterprising practices, such as mergers, acquisitions, strategic alliances and joint ventures is presented. All these create a rather interesting framework in which organizational managers should cultivate and implement the appropriate organizational culture in order to keep their organization competitive and well managed. Finally, case studies from the telecommunications industry will be presented, a field where culture plays a dominant role in either changing procedure or in developing new enterprising practices.
2.0 Organizational Strategy
Despite the disagreements about the definition and the context of organizational culture, many researchers suggest that its management is crucial for the decision making process and the formation of organizational strategy (Lee, 2004). In this section the culture’s influence on strategy and decision making processes will be studied.
Pool (2000) and Daft (2001) consider culture to be a basic structural component of the organizational management system, while Valentine (2000) recognizes its importance for a set of organizational actions and for the organizational structure and the management philosophy. These researchers have been influenced by Deshpande & Webster (1989), who suggest that culture can be handled as any other organizational variable, in order to coordinate the decision making process and to diffuse the organizational strategy. Just like structure, strategy and technology, organizational culture can be managed so that higher levels of financial profits can be achieved.
Key Terms in this Chapter
Joint Ventures: An entity formed between two or more parties to undertake economic activity together. The parties agree to create a new entity by both contributing equity and they then share in the revenues, expenses and control of the enterprise.
Acquisition: Takeover of a company by another in a friendly or hostile manner.
Strategic Alliance: A formal relationship between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations.
Organizational Culture: Is the personality of an organization and is composed of the assumptions, values, norms, artifacts and behaviors of the members of the organization.
Mergers: A combination of two companies into one larger company, mainly through stock swap or cash payment.
Organizational Change: The way of changing procedures, structures or enterprising activities.
Organizational Strategy: The vision of the organization, mainly targeting on a stronger market position.