Organizational culture

Section Title: Organizational culture

Outline

1. Definition of culture

What is culture concerned with?
Why does culture matter in a company?
How do cultures differ?
What level of culture does this chapter focus on?

2. Build the Innovation Culture

Organizational Innovation Structures
Participation as a function of hierarchy

3. 24/7 innovation

Perpetual Innovation

4. Innovation Culture Evaluation

5. Innovation culture case analysis

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Section Title: Organizational culture

Today's organization depend upon innovations for their survival. Only innovators will survive in the global market. ''Innovate or die'' is a genuine proposition as well as a worn cliche. Are companies organized to innovate? In fact, it seems that the majority are organized to not innovate. In this section, we will explore the innovation culture in a corporation to figure out how does it impact the management, strategy, development & research and so on.

1. Definition of Culture

''Without culture, and the relative freedom it implies, society, even when perfect, is but a jungle. This is why any authentic creation is a gift to the future.''

- Albert Camus

Culture is an integral part of every society. It is a term used by social scientists to depict a people's whole way of life in groups (e.g., a family, tribe, region, nation, company and profession). To social scientists, a culture is any way of life, simple or complex, consisting of learned ways of acting, feeling and thinking, and can be learned from his/her family and surrounding environment, rather than biologically determined ways.

According to British anthropologist Edward B Tylor, culture is defined as ''That complex whole which includes knowledge, belief, art, moral, lay, custom, and any other capabilities and habits acquired by man as a member of society.'' Tylor's definition includes three of the most important characteristics of culture:

Culture is acquired by people. Because it consists of learned patterns of behavior rather than the biologically determined ones that are sometimes called instinctive;

A person acquires culture as a member of society

Culture is a complex whole so that it can be broken down into simple units called ''cultural traits.'' A trait may be a custom, such as burial of the dead; a device, such as chopsticks; a gesture, such as a handshake; and arts, such as abstract expressionism.

However, as Norihiko Shimizu said: ''Today's Taboos may be gone tomorrow''. A culture may be static within a short term but it can also change in the long run.

1.1 What does culture concern with?

According to Kluckhohn & Strodtbeck, cultures vary in solutions to common problems. Cultures have dominant or preferred value orientations. The 5 basic problems that cultures concern with are:

1.Relational orientation: the relationship between individuals
2.Time orientation: temporal focus of human life
3.Activity orientation: modality of human activity
4.Man-nature orientation: relationship between human and nature
5.Human nature orientation: character of innate human nature

1.2 Why does culture matter in a company?

''If I were again facing the challenge to integrate Europe, I would probably start with culture.''

- Jean Monnet

Culture has explicit and implicit impact on decisions, which lies in: meeting interacting and conducting, negotiating and compromising, and leading and motivating. In addition, culture also has significant impact on performance, assessment and reward systems, marketing and advertising blunders, problems with cross-border alliances, integration of acquisitions, and frustration.
[...give some examples to this abstracted items in the following writing...]

1.3 How do cultures differ?

Culture differences distinguish groups from one another. All cultures are known to have a set of beliefs that define the code of conduct and values fro that particular culture. People within a same group share the same culture. Culture differs from each other in several ways, such as various greeting customs, moods and opinions shaped by the history events, business concepts, and stereotypes in different regions or countries.

1.4 What level of culture does this chapter focus on?

Culture is meaningful only if it is within a group. A culture group can be organized in various levels, such as national, corporate, professional, sub-groups level, and so on. In this chapter, we mainly focus on corporate culture.

2. Building the Innovation Culture

Innovation is not equal to creativity which is about coming up with clever ideas, but is about the ability to turn knowledge into values or bring creative new ideas to life.

Companies around the world are keen to innovate because innovative companies can benefit from it, such as enhancing brand and image, increasing shareholder wealth as return on investment support, and market share. But innovation is not a commodity that can be purchased or installed like a computer software. Rather it is mainly a culture which must be adopted and nurtured.

Our work on this section focuses on analyzing different types of organization innovation culture which contributes to the innovation work in a company.

2.1 Structure Your Company to Support Innovation

The style of organizational innovation structure is a key factor which can inhibit or foster creativity and innovation. It results from several sub factors including history, strategy, operational design, product diversity, logistics, marking, client base and supplier base. For leaders in a company, there is no recipe for complete structural change, but insights into the properties of nurturing structures are needed to update the existing structures.

There are two basic innovation structure in a corporation: bottom-up innovation structure and top-down innovation structure.

Bottom-up innovation involves decentralized authority, loosely defined tasks, horizontal communications, greater individual authority and flexibility.

[...Innovation is about how to turn ideas into value. While where do ideas come from? Often ideas come from insights... continue]

In contrast with bottom-up innovation, top-down innovation structure includes centralized command and control, clearly defined tasks, vertical communication links and obedience to supervisors usually with rigidity and inflexibility. Top-down innovation structure is usually not preferred. But experience shows that the above can be misleading. For example, flat organizations like bottom-up structure are generally preferred and hierarchical ones like top-down structure are not preferred. However, even flat organizations are in reality hierarchical. Because, there is no innovation without leadership[1] . Leaders are able to inspire innovation. This happens with the attitude they bring as manifested in their willingness and ability to listen, to encourage and to appreciate intelligent failure.

A.G. Lafley and Ram Charan, in their book ''The Game Changer: How You Can Drive Revenue and Profit Growth with Innovation'', point out that structuring for innovation is not a one-size-fits-all exercise. You need to design and install the right organization structures to suit the business strategy and innovation model… many companies make innovation happen through enabling structures of one form or another. Where they often fall short, surprisingly, is that most people in the company don't understand what, in fact, the structures are and how they actually work [4].


2.2 Participation as a Function of Hierarchy

Insights often come about as the result of individual effort; ideas are generally developed and improved in groups. Innovation is generally an organizational outcome [1]. The sheer complexity of today's technologies, and markets means that many people with multidisciplinary background must be engaged in transforming ideas into marketable products and services.

Innovation is not a one-off event nor even a series of one-off events, though such events are an integral part of innovation [3]. Innovation should be a sustainable process in which employees are always encouraged and inspired to think creatively and invited to take calculated risks with new ideas and concepts. Only if innovation becomes a way of life in a company, it becomes perpetual innovation.

3. 24/7 innovation

Innovation is not a one-off event nor even a series of one-off events, though such events are an integral part of innovation [3]. Innovation should be a sustainable process in which employees are always encouraged and inspired to think creatively and invited to take calculated risks with new ideas and concepts. Only if innovation becomes a way of life in a company, it becomes perpetual innovation, which is the key to long-term, sustainable success in these rapidly changing circumstances.

As said in the book ''24/7 innovation'' [5], innovation 24 hours a day 7days a week is no mystery: it is the ability of an organization and the people in it to come up with new ideas to satisfy the changing whims of ever-fickle customers without any special stimulation and without interruption. Innovation throughout the organization, everywhere, everyday, by everyone - 24/7 - to the point where innovation is as natural as breathing.

4. Innovation Culture Evaluation

It is relatively easy to generate ideas, most corporations lack processes to evaluate ideas and move them on to new product or service development.

We will evaluate the innovation culture in a company from several aspects as follows:

Communication distance: normal employees can knock the door of managers or leaders if they wish to talk with them about their ideas.
Long-term VS. short-term orientation: leaders should resist the temptation to look for immediate results
Buffer zones: the most innovative people should have enough buffer zones and innovation room for their ideas.
Commit: leaders should commit to driving the best ideas through to implementation.


5. Innovation culture case analysis


[1] http://www.realinnovation.com/content/c070528a.asp
[2] http://www.realinnovation.com/content/c070430a.asp
[3] http://www.jpb.com/report103/archive.php?issue_no=20090901
[4] http://www.innovationtools.com/Weblog/innovationblog-detail.asp?ArticleID=1149
[5] Book: 24/7 innovation