The document discusses corporate culture and its relationship to the organizational environment. It defines corporate culture as the shared values, beliefs, understandings and norms of an organization. Corporate culture can be seen through visible manifestations like symbols, stories, heroes and slogans, as well as deeper underlying assumptions. The external environment greatly influences internal corporate culture. An adaptive culture is open to change while an unadaptive culture resists change. High-performance cultures are based on a clear mission and shared values that guide decisions and encourage employee ownership.

1. The Environment and Corporate Culture CHAPTER 3 0

6. Organizational Environments Exhibit 3.1 0

15. External Environment and Uncertainty Number of Factors in Organization Environment Adapt to Environment High Uncertainty Low Uncertainty High Low Low High Rate of Change in Factors in Environment Exhibit 3.3 0

18. Levels of Corporate Culture Visible 1. Artifacts, such as dress, office layout, symbols, slogans, ceremonies 2. Expressed values, such as “The Penney Idea,” “The HP Way” 3. Underlying assumptions and deep beliefs, such as “people are lazy and can’t be trusted” Invisible Culture that can be seen at the surface level Deeper values and shared understandings held by organization members Exhibit 3.5 0

21. Corporate Culture Adaptability Adaptive Culture Unadaptive Culture Visible Behavior Expressed Values Managers pay close attention to all their constituencies, especially customers, and initiate change when needed to serve their legitimate interests, even if it entails taking some risks. Managers tend to behave somewhat insularly, politically, and bureaucratically. As a result, they do not change their strategies quickly to adjust to or take advantage of changes in their business environments. Managers care deeply about customers, stockholders, and employees. They strongly value people and processes that can create useful change (e.g., leadership initiatives up and down the management hierarchy). Managers care mainly about themselves, their immediate work group, or some product (or technology) associated with that work group. They value the orderly and risk-reducing management process much more highly than leadership initiatives. Source: John P. Kotter and James L. Heskett, Corporate Culture and Performance (New York, The Free Press, 1992), 51. 0

22. Four Types of Corporate Cultures Adaptability Culture Achievement Culture Consistency Culture Involvement Culture External Internal Flexibility Stability Strategic Focus Needs of the Environment Exhibit 3.7 0