Corporate Culture Impact and Implications PDF

BM2001 THE CORPORATE CULTURE – IMPACT AND IMPLICATIONS Corporate Values According to Lencioni (2002), corporate values or core values are the deeply ingrained principles that guide all employees of a company’s actions. These values serve as the company’s cultural cornersto...

BM2001 THE CORPORATE CULTURE – IMPACT AND IMPLICATIONS Corporate Values According to Lencioni (2002), corporate values or core values are the deeply ingrained principles that guide all employees of a company’s actions. These values serve as the company’s cultural cornerstones that can never be compromised, either for convenience or short-term economic gain. Executives often confuse core values with other types of values initiatives. As an example, when Lencioni (2002) asked the chief executive officer (CEO) of a Fortune 500 networking company to state one of its core values, “A sense of urgency!” the CEO replied without hesitation. As a follow-up, Lencioni asked, “So, your employees take quick action and hit all their deadlines?” “No, they are complacent as hell, which why we need to make urgency one (1) of our core values.” Other types of values (Lencioni, 2002): Aspirational values – In the example, the CEO’s response reveals its confusion regarding the meaning of core value. Far from being a core value, a sense of urgency did not even exist in the organization, and it was just an example of aspirational values. Aspirational values are those that the company needs to succeed in the future but currently lacks. These values need to be carefully managed to ensure that they do not dilute the core. For example, A company may need to develop a new value to support a new strategy, or to meet the requirements of a changing market or industry. The CEO who claimed his company’s core value was a sense of urgency, for instance, was substituting an aspirational value for a core one. Permission-to-play values – These reflect the minimum behavioral and social standards required of any employee. These values tend not to vary much across companies, particularly those working in the same region or industry, which means that, by definition, they never really help distinguish a company from its competitors. For example, a CEO insisted that integrity was a core value of his company. When asked why, he said, “Because we refuse to hire people who misrepresent themselves on their résumés or who provide inaccurate information about previous employment experience.” While his declaration was no doubt valid, most organizations had similar policies. Unless his company was willing to adopt unusually stringent measures to demonstrate that it held a higher standard of integrity than most companies, integrity should be classified as a permission-to-play value, not a core one. Accidental values - These values arise spontaneously without being cultivated by leadership and take hold over time. They usually reflect the common interests or personalities of the organization’s employees. Accidental values can be useful for a company, such as when they create an atmosphere of inclusivity. But they can also be negative forces, foreclosing new opportunities. Managers always need to distinguish core values from merely accidental ones, as confusion here can be disastrous. For example, a fashion apparel company, Sak Elliot Lucca, initially struggled to distinguish its accidental values from its core. Located in the edgy South of Market district of San Francisco, its early employees were single adults who partied on weeknights and owned a disproportionate amount of black clothing; accordingly, the company was accidentally imbued with the values of these employees—trendy, youthful, and cool. 06 Handout 1 *Property of STI  [email protected] Page 1 of 5  BM2001 But as the company grew, two (2) things became apparent to executives: There would be no way to adequately staff the company if only young, hip, “Sak-looking” people were hired. And older, married workers who could make significant contributions might be inadvertently overlooked. The company actively worked to help employees understand that hiring only trendy people had nothing to do with the Sak’s core values of trust (being honest and credible), action (making independent decisions), and ownership (treating the company as if one were a founder). Even “unhip” people should be recruited, as long as they shared the company’s cherished core values. Today the Sak is a truly diverse organization, and it has broadened its product line to appeal to a much broader market. Code of Conduct A code of conduct is a set of rules that guides behavior. A professional code of conduct outlines appropriate actions for employees or members, as well as the legal consequences of breaking these rules. On the other hand, a personal code of conduct does the same as a professional code but does not necessarily come with legal sanctions for breaking the rules (LoveToKnow, 2020). Contents of a Code of Conduct (LoveToKnow, 2020) A code of conduct is only mandated for public companies. Most experts agree that all companies should have a written code of conduct. A good code of conduct in business is specific and outlines the standards by which the entire company is expected to operate. Sections of a comprehensive professional code of conduct include: Company mission Purpose of the code of conduct Compliance with laws or laws relevant to employee or member rights Outline of unacceptable behaviors in the workplace and their consequences Outline of internal practices such as dress code, drug use, or sexual harassment policies Outline of external practices such as confidentiality and conflicts of interest Company and equipment use and protections Outline of code compliance expectations Training requirements and guidelines Job duties and employment benefits Chain of command for disciplinary action Professional Code of Conducts Examples (LoveToKnow, 2020) Most large companies and organizations share their code of conduct on their website to be transparent with customers and employees. This helps establish its brand, protect the company, and protect the employees. Here are the following examples: Facebook - Social media giant Facebook presents its code of conduct on the investor relations page of its corporate website. This is an example of a highly structured professional code of conduct where each section is numbered and includes additional bullet points for easy reading. The company also consists of the date it was last updated and offers a downloadable PDF version. Sections included in the Facebook Code of Conduct are: o Introduction o Conflicts of Interest 06 Handout 1 *Property of STI  [email protected] Page 2 of 5  BM2001 o Harassment o Communications o Public Disclosures o Financial Integrity and Responsibility o Confidential Information o Protection of User Data and Personnel Data o Protection and Use of Facebook Assets o Compliance With Laws o Reporting Violations o Policy Prohibiting Retaliation o Training o Amendment and Waivers Colgate-Palmolive - Hygiene and household product company Colgate-Palmolive has a 49-page full-color code of conduct that is available online in 42 different languages. This example of an extensive code of conduct for a business starts with a message from the president and chief executive officer (CEO). Then, it includes three (3) major sections. The parts of the Colgate-Palmolive Code of Conduct are: o Our Values and Responsibility: Three (3) sections on values and management o Our Relationships: 10 sections detailing specific relationships like those with the board of directors or shareholders o Speak Up: One (1) section on reporting concerns This code of conduct utilizes charts, special graphics, and concise lists to make all information accessible to everyone. Personal Code of Conduct (LoveToKnow, 2020) Personal code of conduct is profoundly personal and relates specifically to the person writing it. This includes a set of behaviors and rules that guides a person in every action he/she takes in life. It can be written down, or it can be something that a person keeps in the back of his/her mind that is set as a personal standard (realistic and flexible). Personal Code of Conduct might include the following: How you treat yourself How you treat loved ones How you treat strangers Your expected behavior in professional settings Your expected behavior in intimate settings How you will react to specific ethical dilemmas What behaviors from you are unacceptable in any circumstance How you will hold yourself accountable for different actions Here are the examples: Conduct Toward Myself o I will not participate in any drug or tobacco use. o I will limit alcohol consumption to no more than three (3) drinks in one (1) night. o I will choose healthy snacks over processed snacks. 06 Handout 1 *Property of STI  [email protected] Page 3 of 5  BM2001 o I will not put myself down for any reason. o I will leave work concerns at work and home concerns at home. Conduct Toward Others o I will extend kindness to all others, even when they do not extend it to me. o I will take action to help a person in need if I see their need and am capable of making the situation better. o I will respect differences of opinion by acknowledging the other person’s stance and not pushing their acceptance of mine. Conduct in Difficult Situations o In a violent situation, I will only retaliate with violence if I am unable to call for or get to help. o If a disagreement turns into a negative argument, I will walk away from the situation. Workplace Compliance with Labor Code Labor Code allows employees to receive their fundamental rights and prevent employers’ malpractices. In the Philippines, the governing law about protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race, or creed and regulate the relations between workers and employers is the Presidential Decree No. 442 otherwise known as the Labor Code of the Philippines. Employees are highly motivated and performed at their best when they are receiving the fundamental rights that they are deserving. To make this possible, the employer should make sure to provide the following fundamental rights of employees: Equal work opportunities for all - The State shall protect labor, promote employment, provide equal work opportunities regardless of gender, race, or creed, and regulate relations between employees and employers. Security of tenure - Every employee shall be assured security of tenure. No employee can be dismissed from work except for a just or authorized, and only after due process. Just cause refers to any wrongdoing committed by an employee; authorized cause, on the other hand, are the economic circumstances that are not the employee’s fault. Workdays and work hours - An employee must be paid by wages for all hours worked. If their work hours fall between 10:000 PM AND 6:00 AM, they are entitled to night shift pay in addition to their salary for regular work hours. If they work over eight (8) hours a day, they are entitled to overtime pay. Weekly rest day - A day-off of 24 consecutive hours after six (6) days of work should be scheduled by the employer upon consultation with the workers. Wage and wage-related benefits - Wage is the amount paid to an employee in exchange for the service that they rendered to their employer. It may be fixed for a given period. Payment of wages - Wages should be paid directly to the employee in cash, legal tender, or through a bank. Wages shall be given not less than once every two weeks or twice within a month at intervals not exceeding 16 days. Female employees - Women are prohibited from engaging in night work unless the work in allowed by the following rules: industrial undertakings from 10:00 PM to 6:00 PM, commercial/non-industrial 06 Handout 1 *Property of STI  [email protected] Page 4 of 5  BM2001 undertakings from 12:00 MN to 6:00 AM, or agricultural takings at night provided that she has had nine (9) consecutive hours of rest. Employment of children - The minimum employment age is 15 years of age. Any worker 15 years of age should be directly under the sole responsibility of parents or guardians provided that work does not interfere with the child’s schooling or development. The minimum age of employment is 18 years for a hazardous job and 15 years for non-hazardous jobs. Safe working conditions - Employers must provide workers with every kind of on-the-job protection against injury, sickness, or death through secure and favorable working conditions. Rights to self-organization and collective bargaining – Every worker has the right to organize and join any legitimate workers’ union, free from the interference of their employer or the government. All workers may join a union for collective bargaining and are eligible for union membership on the first day of their employment. Collective bargaining is a process between two (2) parties, namely the employer and the union, where the terms and conditions of employment are fixed and agreed upon. In collective bargaining, the two (2) parties also decide upon a method for resolving grievances. Reference Lencioni, P. M. (2002). Harvard Business Review. Retrieved from https://hbr.org/2002/07/make-your-values- mean-something LoveToKnow. (2020). Simple code of conduct examples. Retrieved from https://examples.yourdictionary.com/simple-code-of-conduct-examples.html 06 Handout 1 *Property of STI  [email protected] Page 5 of 5