Page 99 - DCOM506_DMGT502_STRATEGIC_MANAGEMENT

Unit 6: Organisational Appraisal: Internal Assessment 2

Notes
Figure 6.1: Value Chain Analysis
Environment
People
Corporate cultures
Labour policies
International issues and culture

Cultural factors specific to the organisation
History and ownership
Size
Technology
Leadership and mission
Cultural Web
Identification of basic cultural style of the
organisation
Power Note that different
Role groups within the
Task organisation may have
Personal different subcultures

Analysis of the strategic implications
Prescriptive or emergent
Competitive advantage
Strategic change
For this purpose, the main elements of organisational culture, as indicated in Figure 6.1 needs to
be analyzed.
Assessing Strategy – Culture Match

When implementing a new strategy, a company should take time to assess strategy-culture
compatibility by considering the following questions:
1. Is the planned strategy compatible with the company’s current culture? If not,

2. Can the culture be easily modified to make it more compatible with the new strategy? If
not,
3. Is management willing and able to make major organisational changes and likely increase
in costs? If not,
4. Is management still committed to implement the strategy? If not,
5. Formulate a different strategy. If yes,

6. Manage cultural change.
Matching Strategy with Culture

When matching strategy with culture, it is important to understand:
1. There is no ‘best’ and ‘worst’ culture. The issue is how well the culture matches and
supports the strategy of the organisation. Cultural mismatches are likely to occur when
organisations are trying to adapt a new strategy.
2. This matching of strategy and culture is likely to become embedded over a period of time.
That is, key elements of the strategy and the culture will reinforce each other gradually. In
other words, the relationship between strategy and culture is usually self-perpetuating,
each matching and reinforcing the other over a period of time.

LOVELY PROFESSIONAL UNIVERSITY 93