Impact of Economic Culture on the Development of Enterprises

Impact of Economic Culture on the Development of Enterprises

Vojko Potocan (University of Maribor, Slovenia) and Zlatko Nedelko (University of Maribor, Slovenia)
DOI: 10.4018/978-1-4666-4373-4.ch009
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Abstract

Values of individuals, culture of groups, ethics of communities, and the resulting influential norms (i.e. VCEN) are interdependent. VCEN tend to crucially influence development and application of knowledge, skills, talents, and other resources. In the current very competitive and increasingly global economy, organizations and countries become more successful if their economic culture is innovation friendly. Economic culture reflects itself in the economic part of VCEN of nations as well, because organizations, such as enterprises, play a crucial role in a nation’s life. National resources are no longer enough, neither is investment, if it is not innovation enhancing. Thus, a new concept of economic VCEN is going to become necessary for people to find a new positive direction beyond the worrisome blind alley of the current economic crisis. The innovation of VCEN is, again, becoming more important than the technological innovation for development of countries and, indeed, for humankind. The contribution discusses two theses: (1) VCEN in organizations is importantly interdependent with the economic culture, and (2) the change of the economic culture in an organization is connected with the changes of the organizing methods and their management.
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Background

Literature on innovation abounds. Today there are many more authors and contributions about different aspects of the innovativeness of SMEs than ever before (Lester & Piore, 2004; Leydesdorff, 2006; Sheshimski et al., 2007; Fink & Kraus, 2009; Chesbrough, 2009; etc.). Pyka and Scharnhorst (2009) offer an interesting new approach to change and learning. Leydesdorff (2006) offers an interesting new concept of modeling, measuring and simulating the knowledge-based economy. Schwartz (2006) is trying to help people be more entrepreneurial. Lester and Piore (2004) warn – when discussing the need for building interpretation capacity – that the contemporary American education lacks schooling that fosters the capacity for creative interdisciplinary co-operation, which is a precondition for success in active innovation.

Key Terms in this Chapter

Development of Organization: Is a term that generally refers to the sustained, concerted effort of all (internal and external) stakeholders of organization to achieve desired results of organization and selected standard of working and behavior in organization.

Organizational Culture: Is defined as “A pattern of shared basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration” that have worked well enough to be considered valid and therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems” ( Schein, 1992 , p. 9).

Innovation: Is defined as every novelty found beneficial in the experience of its users.

Ethics: In a general sense, ethics is the code of moral principles and values that govern the behaviors of a person or group with respect to what is right or wrong.

Economic Culture: We understand the economic culture as a component of VCEN, which is the accepted emotional reflection of the economic, processes in society in the feelings of the prevailing humans, such as opinion makers and their followers.

Organization: We understand organization as a social entity that is goal directed and deliberately structured. Social entity means being made up of two or more people. Goal directed means designed to achieve some outcomes, such as make a profit, win pay increase for members, meet spiritual needs, or provide social satisfaction. Deliberately structured means that tasks are divided and responsibility for their performance is assigned to organization members. This definition applies to all organizations, including both profit and not-profit.

Organizational Change: Is the process by which organizations move from their present state to some desired future state to increase their efficiency and effectiveness.

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