Welcome to Week 3

This week we cover Chapter 4 and the external and internal organizational environments and corporate culture.

To be successful, a company needs to understand what they can and cannot control.

Highlights from the chapter include:

The external environment is outside the organization's control. They have no power. This can be done using a PESTEL (political, economic, sociocultural, technological, environmental, and legal). All these factors could either benefit or challenge a company's ability to succeed. Look at slide 5 for specifics of what falls under each category. Also watch the video on slide 6.
- Industry and organizational leaders monitor environments to identify, predict, and manage trends, issues, and opportunities that their organizations and industries face. This is a starting point for diagnosing the “fit” between types of external environments and industries. See slide 9 for a visual on this concept. Carefully consider the Concept Check on slide 10.
Internal aspects of an organization start with how the company is organized and structured. It helps to know if the type of environment the company is operating. See slide 12 for a graphic on the differences between mechanistic (stable) and organic (changing). Organizational structures have evolved as shown in slide 13, with six listed.
- Functional: Employees are grouped based to their expertise (slides 14-16).
- Divisional: Divisions grouped by products, clients, location. etc. (slides 17-19).
- Geographic: Grouping jobs on the basis of defined geographic sites or areas (slides 20-21).
- Matrix: Both divisional and functional managers have equal authority in the organization and employee will have two “bosses” (slides 22-24).
- Vertical/Networked Team: Knowledge workers are organized to provide expertise, with the use of cross functional teams. More informal (slides 25-27).
- Virtual: Flexible with little or no formal structure (slides 28-29).
Within the internal environment, all factors influence the organization. This include:
- Formal Factors: like leadership. board of director, employees. It also includes
- Informal Factors: like the culture of the company - the basic assumptions about the way employees should act or interact?
Overall, the external factors are pushing on the internal factors, as seen on slide 37.
A way to best understand these internal and external factors is the use of a SWOT (strengths, weaknesses, opportunities, threats). Watch the videos on slides 41 & 42 for a better understanding. Remember, internal factors are under the company control (SW) and external factors are not in the company control (OT). Remember this concept as it will be used for your first paper on creating a personal SWOT analysis.
Next, think about the corporate culture. How do you hire to have a culture fit? Watch the video on slide 45. Corporate culture is a well-understood culture regulates behavior and sets expectations for interaction, performance, and communication. See slide 48 to read about four different culture frameworks.

Have a great week!