1. MGT 500 Final Exam
Dr. Tamara Montag-Smit
Fall 2014
Stephanie Simopoulos

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Part I
Managers are the individuals responsible for supervising the use of an establishment’s
resources to meet common goals. Since the beginning of this course we have explored and
elaborated on the true meaning of management. I hold strong Peter Drucker’s definition on
purpose of management, in lieu of the business world: “To make people capable of joint
performance through common goals, common values, the right structure, and the training and
development they need to perform and to respond to change.” By reverting back and
considering all functions in management (planning, controlling, organizing, and leading)
information regarding organizational culture becomes more valuable.
A mission statement is defined as a corporation's purpose, their values and overall objectives.
The company's culture is the shared values, principles, traditions and ways of doing things that
influence the way organizational members act. Purpose and culture are positively correlated
and can significantly impact one another. When one variable is altered, the other responds
accordingly. A strong culture is characterized by widely shared values and a durable connection
between communal behaviors. The purpose of the company will reinforce this ethical
identification.
The grocery industry is a beneficial constructive market that has always been under close
examination with the general public, especially more recently with increasing concerns about
overall health and diet. Consuming more wholesome, organic foods contributes to a valuable
lifestyle, and the associated statistics reinforce the reality. Because of this, Whole Foods
Market, Inc. (WFM) has grown to become one of the grocery industry’s leading organic
competitors. Within this complex corporation, we are able to evaluate and observe precisely
how organizational culture affects every aspect of a firm, and from there apply these
observations with the four functions of management.
A well-planned strategy can quickly crumble if an organization’s employees cannot properly
execute it. Inability to cooperate, inconsistent communication and internal competition are just
a few consequences that can result from incongruent order. Whole Foods’ mission statement –
Whole Foods, Whole People, Whole Planet – emphasizes the organization’s strategic aim in
embracing responsibility within a co-existing world. Strategic planning is directed toward all
three vicinities. The Company’s overall goal is to balance the needs and desires of their
customers, team members, shareholders, suppliers, communities and environment. According
to the website AZCentral.com, a strategic plan may be inconsistent with organizational culture.
“For example, if your company culture focuses on making the workplace enjoyable and your
strategic plan involves ramping up production, employees may resist the need to work harder
and faster.” After reading Whole Foods’ 2013 annual financial report, I discovered the

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establishment’s philosophy to be extremely altruistic, yet too dispersed. In this instance, Whole
Foods may find themselves overwhelmed. The corporation has made it clear they intend to
positively impact as many regions within their power. However, by dividing efforts so narrowly,
we begin to see the quality of these intentions deteriorate.
Organizational culture is a two-step process. First, a leader must create internal integration and
then organize external adaptation. The influence organizational design has on a company’s
culture is consistently overlooked, but its function proves advantageous despite any
circumstance. Organizing employees can deplete any individual in due time. Because of this, the
establishment and consolidation of team members has become vital in current business
domains. Strategic decision-making involves the process of formulating and implementing
schemes to accomplish and sustain long-term goals. Organizing employees to behave in a
particular manner is sometimes impossible, so one must choose the appropriate team
members who are willing to adapt to change and fulfill the company’s requisites. Effective
alignment of organizational design and culture permits the development and enhancement of
fundamental competency.
Leaders must appreciate their function in cultivating and maintaining an organization’s culture.
Several common traits and behaviors have been identified with individuals who possess
principal sovereignty. These behaviors include, but are not limited to, creativity, effective
communication, execution of a vision or strategy, the development of employees, delegating
tasks and responsibilities, motivation, and innovative thinking. As humans, our culture is
learned through the transmission of social norms, which includes tendencies viewed by
subordinates in any establishment.
Jim Collins often mentions the term “level 5 leadership” in his book “Good to Great.” This
concept combines a paradoxical blend of personal humility and intense professional will,
fashioning a charismatic leader with transformative motives. “Level 5 leaders look out the
window to apportion credit to factors outside themselves when things go well (and if they
cannot find a specific person or event to give credit to, they credit good luck). At the same time,
they look in the mirror to apportion responsibility, never blaming bad luck when things go
poorly” (Collins, pg. 35). Subordinates perceive these remarks and follow suite. With strong and
unified demeanor evolves an instrumental leadership style, and from that, a robust
organizational culture emerges.
The contingency approach to leadership evaluates both the characteristics of the leader’s
followers as well as the immediate environmental factors. These casual factors determine the
appropriateness of executives’ behaviors and decisions, which ultimately regulate employee
performance. I am especially partial toward this approach, mainly because the theory is flexible

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and can be applied to the majority of situations, even those most delicate. This model takes
into consideration the culture of the institute and relates that information back to the
effectiveness of leaders’ behaviors. Environmental contingency factors include task structure,
work group, and the formal authority system; On the other hand, leader behaviors embrace
directive, supportive, achievement-oriented and participative characteristics. This theory, along
with many others, shed light on the potential benefits held by competent business experts.
Different control mechanisms can leave lasting impressions on an organization’s culture. Social
norms are among the most common of control mechanisms. Most individuals comply with
social norms in hopes of gaining acceptance of certain groups. According to the University of
Rhode Island’s website, “High status members of a group are often exempt from peripheral
norms, as are those with high amounts of what is called idiosyncratic credit. Idiosyncratic credit
is generally awarded to group members who have contributed a lot to the group and have
earned the freedom to violate the norms free from sanctions.” Varying amounts of control
inaugurates a set of roles, role expectations, and, in turn, tends to establish a degree of
attractiveness with respect to group members. Determining the amount of autonomy one may
allow for their employees depends on a number of factors. By generating a sense of formal and
informal control between supervisor and employee, an establishment can better organize all
levels of accountability.
Shared values are another key control mechanism that can be applied in business settings.
Besides social values, private individual values become essential in controlling employees.
These private beliefs are typically in compliance with generally desired behaviors. By
manipulating these desired behaviors and leading-by-example, executives and supervisors alike
can gain improved control of their employees, and, in due course, affirmative performance and
satisfaction outcomes. One of Whole Foods’ core values, “asserting team member happiness
and excellence,” truly authenticates their commitment toward building a noble reputation. The
Company was proud to be ranked on Fortune 500’s list of the 100 Best Companies to Work for
in America last year, making them one of only 13 companies placed consecutively for 16 years.
Jack Welch began his book, titled “Winning,” by explaining exactly why winning is so great. He
said,
“Winning companies and the people who work for them are the engine of a healthy
economy, and in providing the revenues for government, they are the foundation of a
free and democratic society…The team with the best players wins, so find and retain the
best players; don’t overbrain things to the point of inaction; no matter what part of a
business you’re in, share learning relentlessly; have a positive attitude and spread it

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around; never let yourself be a victim; and for goodness’ sake – have fun” (Welch, pg. 4-
7).
Winning is great, and when the economy wins, everyone wins. The actually process of success is
definitely nuanced and brutal, but it can be achieved, and an effective management philosophy
can help guide an organization to accomplishment.
Part II
Human resource management (HRM) accentuates the impact of competent, knowledgeable
workers verses inept, unqualified candidates. “Making the right people decisions is the ultimate
means of controlling an organization well. Such decisions reveal how competent management
is, what its values are, and whether it takes its job seriously” (Drucker, pg. 134). Here the author
highlights the importance of filling appropriate positions with the right essential people. From
an executive standpoint, acquiring and retaining proficient employees reflects directly upon the
leader’s decisions and reputation. Effective human resource planning can also direct corporate
strategies, which integrate and drive functional approaches.
Many incorporating executives that possess HRM experience simply perceive the hiring and
firing process as an act toward increasing organizational value. Filling a business with authentic,
innovative employees is a resilient, but most-rewarding, process. Regardless, there is no single
best way to recruit for an organization. Popular determinants include the nature of the
position, time constraints, and budget aggregates.
Part III
John P. Kotter, author of the book “Leading Change,” discovered a useful apparatus designed
specifically for dealing with organizational transformations. With today’s volatile market and
competitive industries, the downside of change becomes inevitable. In the past, various
markets have collapsed from the frustrations and agony in adjusting to shifting conditions.
However, change inadvertently will occur within the walls of any business, so by taking the
necessary precautions, executives can decrease, or potentially eliminate, the negative side
effects associated with unavoidable conversions.
One great example to see this occurrence first-hand is through the automotive industry. This
particular market is ever-changing and constantly requiring attention directed at competitors
and the immediate environmental factors. I had the pleasure of working for a local Chevrolet
dealership for over 7 years, and during that time I witnessed the company’s largest movement:
as one CEO stepped down, his two daughters took over the family business. This was the first

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time in company history that two women were going to operate the venture. As you can
imagine, this factor only added to the load weighing against the dynamic duo, but the manner
in which they handled the transformation was done so with the upmost professionalism.
The first step in Mr. Kotter’s sequence is “Establishing a sense of urgency.” I would like to focus
on this step specifically because I was able to experience it myself, and I believe it has the
greatest impact of all phases in the change process. When beginning to plan for organizational
change, many underestimate the enormity of the task. However, by applying pressure toward
current employees and their related duties, the barrier of high complacency will soon break
through. “Establishing a sense of urgency is crucial to gaining needed co-operation. With
complacency high, transformations usually go nowhere because few people are even interested
in working on the change problem” (Kotter, pg. 38). This mistake happens far too often. On the
other hand, my experience at the car dealership was opposite. When I was hired onto the team,
a sense of urgency had already begun to set in. The owners were about to move onto the next
phase, which consists of creating a guiding coalition. I realized much later that I had been a part
of the change process, and it made me feel like I was truly a part of something restored.
The third step in this process is the development of a vision and strategy, which is then
subsequently followed by the communication of the change vision. These two steps are
important and typically involve upper-management teams. Communication is a priority, mainly
because a great vision is nothing more without unleashing its true potential. This stage is only
successful with an effective means of understanding. The fifth step is “Empowering employees
for broad-based action,” which is proceeded by the action of generating short-term wins. These
two pieces are important because they allow other employees to get involved with the change
movement. Being proactive and getting others “on-board” is the most efficient means of
gaining total support. Actively displaying perseverance to those who may resist the change
efforts can dramatically sway their decisions. Short-term wins share three specific
characteristics, which include visibility, unambiguity, and relevance to the transformation.
Consolidating these gains in order to generate more alterations is done so by implicitly
reasserting key change agents to continuously drive momentum around approved practices.
Resistance is always waiting to reinstate itself, according to Kotter.
“Irrational and political resistance to change never fully dissipates. Even if you’re
successful in the early stage of a transformation, you often don’t win over the self-
centered manager who is appalled when a reorganization encroaches on his turf, or the
narrowly focused engineer who can’t fathom why you want to spend so much time
worrying about customers, or the stone-hearted finance executive who thinks
empowering employees is ridiculous” (Kotter, pg. 139).

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The final step in this procedure is “Anchoring new approaches in the culture.” Culture is
extremely powerful because it can influence human behavior. When implementing new
practices, the organizational culture can determine how accepting the new methods will be.
Attitude and behavior typically change early on, so one must consult the current culture, but
wait until the last step to modify any unwanted norms.
Part IV
Financial measures are clear to attain and identify when observing a company’s success.
Examining fiscal controls like the balance sheet and income statement may speak volumes.
These documents will also gauge a company’s total asset, expense, liability, and tax dollar
quantities. However, dollar amounts do not entirely determine whether or not an organization
has accomplished its goals.
A corporation’s vision and strategy should aim at four major components, which are outlined by
the Balanced Scorecard. These components are comprised of financials, customers, learning
and growth, and internal business processes. Another great example of common workplace
measurement is deemed total quality control. This tool was specifically designed to monitor
and gauge internal organizational practices, thus eliminating undesirable shortfalls. Especially in
times of great organizational change, recording and assessing the effects are necessary.
Inventory control is a popular method of accounting, especially in material industries. The goal
of inventory control is to contain only enough goods in the firm to meet immediate demands.
This is done for a number of reasons but mainly to keep costs at a minimum. Exceeding demand
requests will create a surplus, while inefficient productivity can result in a shortage of supply.
The foundation of inventory control is based around the concept of consistently reordering at
the same point each time the initial order is depleted. The lead time is a small area where
quantities are extremely low, but the reorder point has already been reached so new shipments
are on their way.

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Resources
Collins, J. (2001). Good to great: Why some companies make the leap--and others don't. New
York, NY: HarperBusiness.
Drucker, P. (2001). The essential Drucker: Selections from the management works of Peter F.
Drucker. New York: HarperBusiness.
Johnston, K. (n.d.). How Does an Organization's Culture Affect Its Strategic Plan? Retrieved
December 9, 2014, from http://yourbusiness.azcentral.com/organizations-culture-
affect-its-strategic-plan-24249.html
Kotter, J. (1996). Leading change. Boston, Mass.: Harvard Business School Press.
Scholl, R. (2003, January 1). What is Organizational Culture? Retrieved December 10, 2014,
from http://www.uri.edu/research/lrc/scholl/webnotes/Culture.htm
Welch, J., & Welch, S. (2005). Winning. New York: HarperBusiness.
Whole Foods Market, Inc. (2013). Annual Report on Form 10-K 2013. Retrieved from
http://www.wholefoodsmarket.com/sites/default.