2.  Culture- differentiates good organizations
from bad ones.
◦ Shared things
◦ Shared sayings
◦ Shared actions
◦ Shared feelings
 COMPOSIOTION OF CUTURE:
◦ Beliefs
◦ Values

3. “ culture as a strength can also be a
weakness”
 Characteristics of weak culture:
 Many subcultures
 Few values & behavioral norms
 Rare traditions
 Lack of sense of commitment, loyalty, identity
 Politicized environment
 Hostility to change
 Characteristics of strong culture:
 Explicit set of values & principles
 Considerable time devoted by the management
for communication
 Values shared widely across the organization

4.  Factors contributing for strong culture:
 A founder or an Influential leader who
established desired values
 Sincere and dedicated commitment to operate
business of the organization according to
these desired values
 Genuine concern for the well-being of the
organization's stake holders

5. Approaches to create strategy supportive
culture:
4) To ignore corporate culture
5) To adapt strategy implementation to suit
corporate culture
6) To change corporate culture to suit strategy
requirements
7) To change strategy to fit the corporate culture

6.  All corporate culture include a political
component, so all organizations are political in
nature.
 Organizational members bring with them their
likes and dislikes, views and opinions, prejudices
and inclinations, when they enter into
organization.
 Managerial behavior cannot be purely rational
and, therefore, an understanding is to be
acquired of how corporate politics works and
how the use of power is to be made for effective
strategic management.

7.  Power is defined as ‘the ability to influence others’ and
corporate politics is ‘the carrying out of activities not
prescribed by policies for the purpose of influencing the
distribution of advantages within the organization.
 Managers derive power within an organization from five types
of sources.
3. Reward power arises from the ability of managers to reward
positive outcomes
4. Coercive power arises from the ability of managers to panelize
negative outcomes
5. Legitimate power arises from the ability of managers to use
position to influence behavior
6. Referent power arises from the ability of managers to create
liking among subordinates due to charisma or personality
7. Expert power arises from the managers’ competence,
knowledge and expertise that is acknowledged by others

8.  The nature of organization itself creates the conditions
for power and politics to manifest. For instance, the
manner in which the organization structure is created
leads to power and politics.
 Since material rewards, promotions, prestige and ego
are involved, each organization more or less is affected
by corporate politics.
 The exercise of power and use of politics has two
connotations: negative and positive.
 When viewed negatively, power and politics are means
for domination, manipulation and subjugation. They
entail self-serving behavior involving deception and
dishonesty for achieving individual or group interest,
leading to conflict and disharmony in the organization.

9.  When taken positively, power and politics are
means for achieving organizational
objectives. The use of power and politics is
the means to resolve conflicts and bridge
genuine differences of opinions through a
process of negotiations and seeking
collaboration.
 Political considerations and use of power,
therefore, are a part of behavioral
implementation by strategists.

10.  Strategy implementation is basically about change
management. Therefore corporate politics and
use of power have a definite role to play in
strategy implementation.
 Politics and power affect the way a strategy is
formulated and implemented. A manager cannot
effectively formulate and implement strategy
without being perceptive about company politics.
 Political consideration affect which type of
objectives take precedence over others and what
strategy the firm has to choose.

11.  Generally, there is more politics in implementing strategy than
in formulating it. In implementation, politics and power affect
a number of elements. The nature of strategy implementation
requires consensus building, managing coalitions and creating
commitments.
 Few examples, resource allocation is ultimately a rational-
political decision, which results in the sharing of scares
resources among different organizational units, structure
result in the distribution of authority and responsibility and
decides how power will be exercised, and corporate culture is
itself partly, the outcome of the use of politics and power.
 Having an understanding of the use of politics and power,
strategist can perform the tasks of strategic management
better. ‘Indeed, having astute political skill is a definite and
even a necessary, asset for a general manager to have in
orchestrating the whole strategic process.

12.  The typical approaches to a strategic use of
power and politics may involve one or more of
the tactics mentioned below.
First of all, to accept the inevitability of politics being
there in the organization.
Understand how an organization’s power structure
works, who wields real power and influence and who
are the individuals and groups whose opinions carry
weight and cannot be disregarded.
To be sensitive and alert to political signals emanating
from different part of the organization.

13.  To know when to tread softly and rely on coalition
management and consensus-building and when to push
through decisions and actions by a selective and judicious
use of ‘Machiavellian’ methods.
 To lead strategy and not to dictate it, being patient till the
consensus emerge.
 To let most negative decisions emerge as a group
consensus rather than as a directive from the top
 To gather support for acceptable proposals and let the
unaccepted ideas die a natural death
 To reward organizational commitment and penalize
negative or indifferent attitude
 To practice principled politics and use openness and
honesty to counter unprincipled politics

14.  In the Indian context, the presence of politics and use of
power are, perhaps, more visible than in other culture.
 This may be due to two factors: the nature of Indian
society and the higher level of enviousness exhibited by
Indian managers
 J.L. Pearce describe India as a nonfacilitative
organization context
 The person-oriented nature of Indian society suggests
an emphasis on particularistic rather than universalistic
treatment of employees, which leads to reliance on
personal characteristics in hiring, promoting and
rewarding employees.

15.  Employees feel that competence alone may
not enable them to progress in their career.
Some may resort to manipulative or
ingratiatory behavior.
 One research study in Indian firms found that
employees’ actual political behavior was
related to feelings of alienation and
interpersonal mistrust in the work place.
 Another factor could be pervasive
enviousness exhibited in Indian
organizations.
 Manager have not only to deal with – and be
affected by – intracorporate politics, but also
intercorporate politics between rival

16.  At a higher level, Indian companies are
plagued with politics between associations
and federations of business and industry,
public versus private sector, small versus
large sector, multinational versus local firms,
and technocrats versus bureaucrats.
 In such condition, strategists have to be aware
of not only internal political consideration but
also the politics and power play present in
other organization, particularly government
departments and ministries, with whom they
have to deal with on a continual basis.

17.  PERSONAL VALUES AND BUSINESS ETHICS
Values
Personal values refer to a conception of what an individual or groups
regard as desirable.
A value is a view of life and a judgement of what is desirable, which is
very much a part of person’s personality and a groups morale.
e.g A benign attitude to labour welfare is a value which may prompt an
industrialist to do much more for workers than what labour laws
stipulate.
Service mindedness is a value, manifests in better customer satisfaction
Personal values imbibed from parents, teachers, elders and an
individual grows, values are adapted and refined in light of new
knowledge and experience.
Within organization, values are imparted by founder entrepreneur or a
dominated CEO and these remain in some form for a long time after a
person is not there
17

18.  Business ethics
In the discipline of management studies, business ethics is The study
of how personal moral norms apply to activities and goals of a
commercial enterprise.
It is not a separate moral standard, but the study of how the
business context poses its own unique problems for the moral
person who acts as the agent of this system.
Practically, business ethics operates as a system of values and is
concerned primarily with the relationship of business goals and
techniques to “specifically human ends” means viewing the needs
and aspirations of individuals not merely as individuals but as a part
of society It also means the realization of the personal dignity of
human beings.
A major task of leadership is to inculcate personal values and impart
a sense of business ethics to the organizational members. At one
end, values and ethics shape the corporate culture and dictate the
way how politics and power will be used, and at the other end,
clarify the social responsibilities of the organization.
18

19.  Importance of values and ethics
Increased awareness around the world about ethical practices in
business.
International organizations like world bank and IMF concerned
whether aid provided is used for intended purpose and not fritterd
away by corrupt Govt officials.
Transparency international brings out annual rating of countries on
an index of corruption that serves as guideline for foreign investors
and international donor agencies.
Corruption in industry is a major by-product of degradation of
values and ethics, which is also related to discretionary powers of
regulatory system designed and administered by an unholy alliance
of bureaucrats and politicians.
19

20.  Values, ethics and strategy
The intentions of individuals, that is, their “purity of mind” as
decision makers within an organization matter a lot in strategic
management.
There has to be a right connection between values, ethics and
strategy.
The decisions should not only be on the basis of purely economic
reasons but also consider values and ethics.
Business ethics is considered to integrate core values such as
honesty, trust, respect, fairness into strategic management, policy
making, practicing management and decision making. It has been
percieved as a set of a legally driven codes, in the form of a list of
do’s and don’ts for the company executives, which have to be
complied with.
Business ethics is being identified as a major source of competitive
advantage.
20

21. Values are personal in nature ( e.g. belief in providing customer
satisfaction and being a good paymaster ) while ethics is a generalised
value system (e.g. avoiding discrimination in recruitment and adopting
fair business practices )
business ethics can provide the general guidelines based on which
strategic management can operate.
Values, however, offer alternatives to choose from.
Organizations derive values and ethics from their corporate culture.
Corporate culture is the outcome of shared assumption that individual
members of the organisations have.
The right set of values and code of ethics have to be formulated by an
organization on the basis of founding philosophy, cherished traditions,
norms of ethical behavior and social requirements.

22. Inculcating values and ethics
 Considering values and ethics in recruitment and selection to
ensure compatibility of the character traits of potential employees
to the ethical system of the organization.
 Incorporating the statement of values and code of ethics into
employee training and educational programmes .
 Example setting by top management in terms of actions and
behaviour that reinforce the values.
 Communication of values and code of ethics through wide
publicity and explanation of compliance procedures.
 Constant monitoring of compliance by superior staff and top
management.
 Consistent nurturing of values within the organization through
their integration into policies, practices and actions.
 Paying special attention to those parts of the organization that
are susceptible to ethically- sensitive activities such as purchase and
procurement, dealing with Govt and other external agencies. 22

23.  Reconciling divergent values
Strategists have to reconcile divergent values and if necessary.
A typical case of value divergence may arise while setting objectives
and determining the precedence of different objectives.
One group- production oriented objectives, say , standardization
and mass production
Another group- Marketing related objectives, say, quality, variety
and small lot production
CEO should reconcile these divergent values in the light of strategic
requirements and environmental considerations.
 Modifying values to create consistency
Modification of values is frequently required in strategy
implementation
It is difficult, if not impossible, to change, like culture.
A judicious use of politics and power, redesigning of corporate
culture and making systematic changes in the organization can help
to modify the values gradually. 23

24.  Strategic planning provides answer to what
organization “might & can do”
 Personal values determines what organization
“wants to do”
 Social responsibility relates to what
organization “ ought to do”
 So social responsibility should be made
explicit and meaningful

25. View 1 View 2
 Function of business is  Business organizations
just to achieve are part of society
economic efficiency  Have to serve societal
and maximize profit interests and not just
 Social functions should profit
be left to institutions  Allocate resources for
of society this purpose

26.  There are four models of CSR operating in
India :
2. Gandhian model = voluntary commitment
3. Nehruvian model = state driven policies
4. Milton Friedman model = owner objectives
5. Freeman model = stake holders
responsiveness

27. 1. Market based pressures and incentives
2. Civil society pressures
3. Regulatory environment

28.  Generally top management decides on major
decisions taken in CSR
 So alignment of social responsiveness with
strategic management is necessary
 Hence role of strategists will be affected by
social responsiveness