The Lancaster MBA

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30636476 Amaury Landemaine FMBA501 Organisational Behaviour Pr. Frank Blackler Making reference to material from the OB and HRM module, discuss the key preoccupations for, and challenges of, managing organisations over the next decades 2666 01/11/2011

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Introduction

Boulding (1956, cited in Draft and Weick, 1984) describes organisation as one of the most complex systems imaginable. Indeed, organisations can concern any association of people, whatever the context. They are multi-disciplinary, covering aspects as production, management or relationship. Furthermore, they can be influenced by both outsider and insider factors, e.g. organisation members or legislation framework. Organisations and organisational behaviour have been widely studied throughout the twentieth century, describing their variations in our modern History. These changes finally seem to follow the evolutions of industries and the whole society (Brigham, 2011), which lead us to wonder about the future of organisational behaviour.

In this essay, I will describe the main challenges that managers will have to face in the organisation management. At the sight of the strong link between past history and organisations, I will firstly describe the future trends shaping our society in order to highlight the major issues for companies organisation. The world we are living is globalised, where barriers and distances between people are abolished. This phenomenon is now generalised, from multinational corporations established in many countries to local industries using the worldwide market for supply and sales. One of the main issues for companies will probably be to manage the scale differences between global organisation and local establishment. This contrast is known as glocalisation (Svensson, 2001) and consists finally in how to combine

standardisation and local adaptation. I will use the analysis of the first section to focus on specific aspects of this dilemma. So section two is a review of the global vs local issue focused on the organisational practices while the third section is oriented on organisations environment. The final part concludes and provides a general analysis.

Society: indicator of organisational evolutions

Organisations are evolving in a constantly changing society. I use here society in the broad sense, including people, their social relationship, organisations, habits and culture. Corporations have to understand and adapt to these changes in order to remain competitive. This adaptation explains the evolution of organisational behaviour in the past, from the industrialisation era with a machine like organisation

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(Taylorism...) to the dotcom generation with an increase communication and importance of technologies. By understanding the mechanisms which have influenced our past, we may try to predict the future. Cetron and Davies (2010) forecasted the main trends of the tomorrows world. This analysis can be summarized into three categories: Technological improvements Increased social consciousness Management and institutions changes

Firstly, technological innovation should increase, enabling companies to improve efficiency and control. Transports will be more accessible, affordable and faster. This would lead to an increased communication, reducing even more effective distances. So levels of globalisation are likely to be increased by the technological

improvements. According to Cetron and Davies (2010), people around the world are becoming increasingly sensitive to environmental issues as the consequences of neglect, indifference, and ignorance become ever more apparent. In addition, they will expect more and more social responsibility from companies and involvement in local communities. An alignment of corporations values with social/political behaviour as honesty, integrity, and transparency will probably be required. For companies, not only customers habits and desires will change but regulations will also become more and more restrictive. This will concern

environmental restrictions as wastes treatment or energy efficiency but will also be applied in other sectors as investment and capital flow. These regulations, applicable in specific areas, will constraint global companies to adjust locally their organisation, in accordance with the requirements.

We can finally understand from the Cetron and Davies forecast (2010), that our society will see the rise of common principle, worldwide shared but which application can be arranged by local administrations. Thus, companies will have to adapt their organisation and management in accordance to this contrast. It can be translated on a company scale, where operational aspects, more related to a local attachment, require adjustments.

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Operational aspect
Companies are now operating in completely different environment than a decade ago. They evolve in a complex and turbulent context where increased

communication, global competition or changeable and unpredictable markets are the norm (Lane and Down, 2010). This environment varies with the time and also with the location. Multinational companies, which can be assimilated to network with a

single head centre and multiple facilities at the same level (Hirschhorn and Gilmore, 1992), are established all over the world and are particularly subject to this dispersion. Thus, organisational models, issued from headquarters cannot be applied everywhere in the globe in the same way. Even if they lie on similar principles, working organisation and operational management must integrate differences in national or regional culture, customers habits or legislation. In that way, Woywodes study (2002) of the car industry provides a strong example of this necessary local adjustment of global policies. It demonstrates how a collaborative organisation, based on working groups, widely used in this sector is adapted in each country in accordance with the local working culture. Indeed, Woywode argues that in order to be applied, an organisational concept must firstly be interpreted, which depend on the framework (local conditions) and the managers understanding (local culture). In the future, even if globalisation will probably mitigate cultural differences, the world will not be totally standardized. So companies will have to integrate local specificities in their organisation and management methods in order to have the most efficient workforce.

In addition to this interface with local environment, multinational corporations may also face an internal issue. Indeed, the complexity of this kind of organisation obliges them adapt the level of control within their organisation. The first aspect of this constraint is mainly due to a problem of feasibility. Some objectives cannot be reached only thanks to measures or control and requires the total acceptance of companies goals by the employees (Mossholder, Richardson and Settoon, 2011). In that case, the proportion between control and involvement may depend on several factors as the level of independence (own hierarchy, communication with

headquarters ...) or the specificity of the facility (particular market ...). The less power you have, the more consent you need. Furthermore, without considering the feasibility of this control, it appears that giving freedom to your employee permit to improve efficiency and profitability, if they remain connected to the organisation (Haas, 2010). The aim would be to involve employees thanks to increased

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responsibilities and autonomy (e.g. Janz, Colquitt, & Noe, 1997, cited in Haas, 2010). As an example, John Timpson, chairman of Timpson Ldt succeeded in increasing significantly the turnover and benefit of its company by giving power to people in the front line, as being in charge of the price settlement or stock management (Timpson, 2010). Finally, global corporation will have to manage and adjust the level of control in their organisation, depending on organisational level. On a micro level, process has to be fully controlled in order to comply with specific standard of quality (Garvin, 1984). This principle can also be applied in specific industry with strong requirements in term of safety, certification or regulation. On the other hand, organisations should support employees freedom on a more global level, in order to promote reflection, adaptability, involvement and to avoid mistakes propagation, while fixing the objectives to be achieved.

The difficulties of a huge organisation to manage global and local dont lie only in operational issues. Companies can also face problems regarding all the contextual aspects if they want to apply a unique policy despite the complexity and diversity of their organisation.

Companies environment
Because of their widespread structure, established in various locations and including specificities, companies need to link all their partners together and focus them on a common goal. In that way, they try to instil common values and culture through all level of their organisation. Indeed, culture, when is anchored in the company organisation, can be internalised by employees and influences their behaviour and provide them an understandable orientation (Buchanan and

Huczynski, 2010). It can lead to create common identities which tend to be extremely energizing and motivating (Hirschhorn and Gilmore, 1992). A strong example of organisational culture can be seen in the Toyota Company which uses values and principles, as continuous improvement or devotion to the team, to create a single identity and thus influence its employees behaviour and reflections (Hindle, 2006 and Takeuchi et al., 2008; cited in Buchanan and Huczynski, 2010). So in a globalising world, where more and more companies become supranational and face problems due to local differences, companies will need to resort to enterprise culture.

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Even if a global enterprise culture enables to mitigate cultural differences, it cant succeed in erasing them totally. Obviously, people have different identities, depending on personal or environmental factors as a particular race, occupation or geographical location (Hirschhorn and Gilmore, 1992). Globalisation and its loss of boundaries also tend to reinforce these local and personal identities as a reassuring environment. Once again, companies need some local modification of their global organisation. Enterprises culture should be able to integrate or allow personal identity and insure respect between communities (Hirschhorn and Gilmore, 1992). In addition to the difficulty of establishing a culture enabling personal identity, values can also lead to different results, depending on cultural differences. Fey and Denisons survey (2003) clearly demonstrates variations in the effect of enterprise cultures between facilities in the United States and in Russia. Values as involvement or adaptability seem to be more correlated with production improvements in the United States (quality, performance) whereas they are more market oriented in Russia (sales growth, profitability). So companies will also have to adapt their values and culture in specific area if they want to achieve a global objective.

Companies culture will also have to follow the trends of our society and requirements of their customers. In that way, the increasing public awareness in term of environmental and social issues will oblige companies to struggle these matters. In a general manner, companies are now seen accountable for social issues and should communicate and behave to comply with environmental protection, ethic and community expectations (Porter and Kramer, 2006). Furthermore, external groups as Non-Governmental Organisation, customer association or the media are gaining power to bind companies, notably due to the increased communication (Jensen and Sandstrom, 2011). So, in addition to internal values directly related to their activity, companies culture will also have to focus on societal issues. The problem of this concern is that it needs to be part of the global culture in order to provide a good visibility and a strong direction but finally needs practical actions which cannot only be carried out by rules (Strathern, 2000; cited in Hoeyer and Lyne, 2009). So this issue of Corporate Social Responsibility, which will certainly become preponderant, should be tackled by involving each aspect of an organisation, from its global culture to its local actions and concern both internal and external aspects. The internal point of view considers the employees welfare which should be promoted in order to improve productivity. In that way, Blanchard and Johnson (1983) argue that people who feel good about themselves produce good results. As for the external aspect, it should also include an adaptation between the global and local scale.

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Indeed, on a global side, organisations can be engaged in a worldwide matter as recycling, energy saving or charities thanks to its cultural behaviour or actions done at the highest level. On the contrary, facilities are expected to support specific communities, depending on local needs. The future requirement of social action or responsibilities for corporations will become undeniable but they will have to make the balance between global and local actions. While the former can be associated to marketing and be used to build a brand image, the latter bring a legitimacy to work with the communities.

Conclusion
In this essay, I tried to describe the main challenges that companies will face in term of organisation management. Based on the assumption that organisations follow the evolution of the society, I focused my work on globalised company as it will be the main characteristic of the tomorrows world. These huge organisations can be seen as complex network evolving in several different environments. Thus their main preoccupation will be how to manage global and local scales, standardisation and specificity, structure and adaptability. Companies established in several countries will encounter specificities based on cultural differences impacting the operational aspect of the corporations as well as their environment. Finally, companies will have to adapt the working organisations to their local context and culture. Their complexity will lead them to adjust the control level between the different layers of their organisation. They will need to establish a strong culture to gather people while enabling personal identity. Finally, companies will have to show their ability for being responsible and accountable of their social environment. To conclude, the challenge will might be to place human at the heart of the organisation and find a framework permitting to understand and tolerate people differences, to trust them and transfer them the executive power, in an organisation that take care of their stakeholders.

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References
Blanchard, K. and Johnson, S. (1983). THE ONE MINUTE MANAGER, London: HarperCollinsPublishers Boulding, K. E. (1956). General systems theory: The skeleton of a science. Management Science, 2, pp. 197-207 Brigham, M. (2011). Organisational Behaviour Since 1945. FMBA501, Organisational Behaviour and Human Resources Management, Lancaster University

Management School, unpublished Buchanan, D. A. and Huczynski, A. A. (2010). ORGANIZATIONAL BEHAVIOUR. 7th Ed. Harlow: Pearson Education Ltd Cetron, M. J. and Davies, O. (2010) Trends Shaping Tomorrow's World forces in the natural and Institutional environments. The Futurist, July/August, 44 (4), pp. 38-53 Daft, R. L. and Weick, K. E. (1984). Toward a Model of Organizations as Interpretation Systems. The Academy of Management Review, 9 (2), pp. 284295 Fey, C. F. and Denison, D. R. (2003). Organizational Culture and Effectiveness: Can American Theory Be Applied in Russia?. Organization Science,

November/December, 14 (6), pp. 686-706 Garvin, D. A. (1984). Japanese quality management. Columbia Journal of World Business, Fall, 19, pp. 3-12 Haas, M. R. (2010). The double-edged swords of autonomy and external knowledge: analyzing team effectiveness in a multinational organization. Academy of Management Journal, October, 53 (5), pp. 989-1008 Hindle, T. (2006). Incalculating culture: the Toyota way. The Economist, The New Organization: A Survey of the Company, 21 January, p13 Hirschhorn, L. and Gilmore, T. (1992). The New Boundaries of the Boundaryless Company. Harvard Business Review, 70 (3), pp. 104-115 Hoeyer, K. and Lyne, N. (2009). An organizational perspective on ethics as a form of regulation. Medicine, Health Care and Philosophy, 12 (4), pp. 385-392 Janz, B. D. Colquitt, J. A. and Noe, R. A. (1997). Knowledge worker team effectiveness: The role of autonomy, interdependence, team development, and contextual support variables. Personnel Psychology, 50, pp. 877-904 Jensen, T. and Sandstrom, J. (2011). Stakeholder Theory and Globalization: The Challenges of Power and Responsibility. Organization studies, 32 (4), pp. 473-488

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Lane, D. A. and Down, M. (2010). The art of managing for the future: leadership of turbulence. Management Decision, 48 (4), pp. 512-527 Mossholder, K. W. Richardson, H. A. and Settoon, R. P. (2011). HUMAN RESOURCE SYSTEMS AND HELPING IN ORGANIZATIONS: A RELATIONAL PERSPECTIVE. Academy of Management Review, 36 (1), pp. 33-52 Porter, M. E. and Kramer, M. R. (2006). Strategy & Society: The Link Between Competitive Advantage and Corporate Social Responsibility. Harvard Business Review, 84 (12), pp. 78-92 Strathern, M. (2000). Introduction: New accountabilities. In Audit cultures. Anthropological studies in accountability, ethics and the academy, ed. M. Strathern. London: Routledge Svensson, G. (2001). "Glocalization" of business activities: a "glocal strategy" approach. Management Decision, 39 (1), pp. 6-18 Takeuchi, H. Osono, E. and Shimuzu, N. (2008). The contradictions that drive Toyotas success. Harvard Business Review, 86 (6), pp. 96-104 Timpson, J. (2010). Upside Down Management: A Common Sense Guide to Better Business. Chichester: John Wiley & Sons Ltd. Available at: <http://books.goo gle.fr/books?hl=fr&lr=&id=1anb_aL95KEC&oi=fnd&pg=PR2&dq=upside+down +management+john+timpson&ots=mcUAw_4STN&sig=V6ShonNqePyc711pn Q4Yof8WpMM#v=onepage&q&f=false> [Accessed 29/10/2011] Woywode, M. (2002). Global management concepts and local adaptations: working groups in the French and German car manufacturing industry. Organization Studies, July/August, 23 (4), pp. 497-525