Culture Is Both an Asset and Liability - Discuss

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lessen as the culture strengths at the expense of employee diversity as the stronger the culture, the more uniform it is. Furthermore, regardless of whether the employee is to adapt to the culture, most organisations would hire based on whether the employee would be compatible with the organisation, further eliminating diversity.

However, employee diversity can be beneficial as it brings new ideas, perspectives and approaches, assisting in problem preventing and solving. This can be supported by the chairman of PricewaterhouseCoopers, Bob Moritz, stating diversity as the “key to sustainable global growth” (cited directly from No.1: PricewaterhouseCoopers – Diversity Inc. Online (2012)) [9] as he realised that people approached issues differently and that there is no right or one method. Therefore, it is crucial that employee diversity is maintained, however culture (especially strong) is a barrier to diversity; hence poses a liability to an organisation.

Moreover, culture can make it difficult for mergers and acquisitions. This is because stronger cultures have a greater lack of flexibility, thus more difficult to adapt to change such as structural and the constant changing business environment. Although factors such as financial benefits are significant reasons for acquisitions and mergers, many organisations fail to consider the culture of the two businesses and its compatibility to merge. This may result in culture conflict within the business as employees would be resistant to change due to the commitment of the key values, reflected as Stephen Rhinesmith said, "the basic dilemma of organizational change is that it must be freely adopted by the people that it affects, who are likely to be against its introduction." (cited directly from Corporate Culture: Asset or Liability - Ivey Business Journal (2000)) [10].

Moreover, there is little that management can do to solve this issue especially in the short run as it takes years to gradually change an organisation, even under favourable conditions, hence presenting further issues with organisational culture. An example to further support the displeasure of the culture alteration is evident at GE Capital with its eight year structural change, as it Huy stated it, “left GE’s remaining employees reeling from cultural shock and its managers exhausted” (cited directly from Time, temporal capability and planned change - Academy of Management Review (2001), pg. 619) [11]. Thus, culture is a liability to organisations as it is a hindrance for adapting to change and situations including mergers and acquisitions; worsened by the long process of gradual cultural change.

In summary, organisational culture is mostly an asset to an organisation as supported via culture acting as a control system and in developing leadership behaviour within employees. However, in many situations culture can be the leading cause of issues including barriers to employee diversity, as well as mergers and acquisitions; and difficulties in new employees in adapting to the culture. Hence, culture is predominately an asset as it is essential to the success of an organisation, however the issues caused by culture results in it being a liability as mentioned in this essay. Thus, culture certainly should still be implemented for long-term financial success; however the organisation should consider how to combat and prevent issues that may arise in future as a result.

References

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