How Culture Affects Productivity Organizational culture and productivity are closely related. Simply stated, productivity is the art of getting the company''s products and/or services to the customer at the lowest possible cost. But it is more than that - it is related to quality, to customer needs and to labour relations. In other words, productivity and good management are inseparable. Productivity is a result of motivation, and motivation thrives in a good climate. If management is to transform this fragile good climate into a long-lasting culture for success, it will have to focus on the following seven areas of improvement: 1. Organizational Clarity The degree to which the goals and plans of the organization are clearly perceived by its members rises in proportion to the employees'' feelings of involvement in the goal-setting and planning procedures. Fostering this feeling of involvement and direction is more important than presenting lists of objectives and detailed plans. To promote organizational clarity, involve all members of the organization in the goal-setting and planning process. 2. Decision-Making Structure We tend to forget that the main purpose of structure is to facilitate decision making, not to develop new organizational charts and lines of authority. In some organizations, especially high technology, ambiguity or looseness of structure may be preferable. Make sure that there is a free flow of information for decision making throughout the organization, and that the structure for disseminating that information allows positive outcomes. 3. Organizational Integration Determine how much cooperation exists among various units of the organization. Do they communicate effectively to help achieve the organization''s objectives. Cut through red tape by forming temporary task forces, made up of people from various disciplines, which sidestep hierarchial structures. 4. Relationship of Management Style to Culture The use of an authoritarian style in a democratic culture is disastrous: resistance is inevitable. Similarly, democratic management in an authoritarian culture leads to the chickens-without-heads syndrome. People who have worked in an authoritarian climate will have been discouraged from using their own initiative in doing their jobs. They have not felt free to question constraints, and have not sensed that top management will support them if they have made poor decisions. They have not been allowed to develop entrepreneurial traits that enhance innovation and ultimately productivity. Ensure that the management style suits the culture. 5. Organizational Vitality Organizational vitality is measured by the boldness of its goals and its responsiveness to changing conditions. This requires that employees be allowed to make mistakes. Develop a
system that encourages employees to take risks for the betterment of the organization without the threat of punishment and find ways of helping them learn from their mistakes. 6. Compensation The compensation system should reinforce a success orientation without being too positive. If too positive, employees comes to expect ever-increasing rewards. If too negative, employees may retaliate by, for example, working to rule. Develop a system of compensation that is equitable, competitive and related to long- and short-term performance. 7. Human Resource Development Provide opportunities within the organization for people to develop to their full potential. How does the company deal with obsolescence? Are old or unneeded people fired? Does management give credit to those outgoing people for their career contributions? Or is the prevailing attitude, "what have you do for me lately?" How honourably the company acts in these situations will do much to determine whether or not it has a culture of success. Concerning the relationship between culture and productivity, behavioural scientists have identified a number of human characteristics that tend to fly in the face of many...
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