Copyright © 2019 Pearson Education, Inc.
5-14
Learning Objective 5-6:
Describe the development and explain the importance of corporate culture.
Management and the Corporate Culture
Corporate culture is the shared experiences, stories, beliefs, and norms that characterize
an organization. It helps to define the work and business climate in an organization. It is the
unique identity of the company and helps to direct employees‘ efforts toward the company goals.
A. Building and Communicating Culture
This involves having an understanding of the culture, transmitting the culture to others in the
organization, and maintaining the culture. Corporate culture influences management
philosophy, style, and behavior. Managers, therefore, must carefully consider the kind of
culture they want for their organizations and then work to nourish that culture by
communicating with everyone who works there. Effective communication is a key task.
B. Changing Culture
Organizations must sometimes change their cultures. This involves analyzing the company‘s
environment, formulating a vision of a new company, and setting up appraisal and
compensation systems for employees who enforce the new values.
QUICK QUESTIONS
What is the corporate culture at your job? In the U.S. Marine Corps? On a football team?
In a beauty salon?
What types of corporate cultures are the easiest or most difficult to change? What are
some variables that make such change easy or difficult?
Use In-Class Activity 5: Up for Debate: Who Creates Corporate Culture?
Time Limit: 30 minutes
Learning Catalytics is a “bring your own device” student engagement, assessment,
and classroom intelligence system. It allows instructors to engage students in class
IN-CLASS ACTIVITIES
In-Class Activity 1: Ice-Breaker: The Management Process
Activity Overview:
This activity helps students better understand the management process.
Time Limit: 30 minutes
What to Do:
1. Divide students into three-member groups, informing them that the manager of a local
2. Ask each group to think of ways in which the caterer can use the four basic functions of
3. Reassemble the class and discuss the ways in which the managerial functions may be used.
(15 minutes)
In-Class Activity 2: Class Discussion: How Do Your Goals Stack Up?
Activity Overview:
This activity is designed to help students understand the connection between long-term,
intermediate, and short-term goals.
Time Limit: 30 minutes
What to Do:
1. Ask students to write down one or two of their long-term goals, focusing on the five-year-
plus horizon. (10 minutes)
2. Ask students to write down one or two intermediate goals—focusing on a one- to five-year
horizon—that may help them to achieve their long-term goals. (10 minutes)
3. Ask students to identify one or two short-term goals—covering a range of less than one
year—that may help them to achieve their intermediate goals. (10 minutes)
Don’t Forget:
In-Class Activity 3: Small-Group Discussion: SWOT Analysis
Activity Overview:
This activity asks students to brainstorm in small groups in order to complete a SWOT analysis.
Time Limit: 30 minutes
What to Do:
1. Divide the class into small groups, asking each group to identify internal strengths (S),
2. Reassemble the class and discuss each group‘s input. (10 minutes)
Don’t Forget:
In-Class Activity 4: Up for Debate: I Can’t Believe This Has Happened!
Activity Overview:
This activity is designed to get students talking about crisis management.
Time Limit: 20 minutes
What to Do:
1. Divide the class into small groups and ask each group to assume you have been suddenly
called away for the next three weeks, but that class must go on. Appropriate course material,
2. Each group must decide on the best way to continue. How can material and objectives be
adequately covered? Who should carry out the instruction? (20 minutes)
In-Class Activity 5: Up for Debate: Who Creates Corporate Culture?
Activity Overview:
This activity asks students to share their thoughts on corporate culture.
Time Limit: 30 minutes
What to Do:
1. Divide the class into three-member groups and ask them to discuss among themselves who
creates corporate culture. Ask the groups to consider these conversation starters: (15 minutes)
a. If top managers create corporate culture, how do they get everyone else to follow?
b. If first-line managers or employees create corporate culture, how do they get top
managers to go along with it?
d. When corporate culture changes, what typically causes the change?
2. Reassemble the class and discuss each group‘s answers. (15 minutes)
Don’t Forget:
ANSWERS FOR END OF CHAPTER ACTIVITIES
QUESTIONS FOR REVIEW
5-1. Describe the roles and responsibilities of top, middle, and first-line managers.
Top managers are strategic planners responsible for corporate performance and formulating
5-2. What are the four main purposes of setting goals in an organization?
5-3. Identify and explain the three basic steps in strategy formulation.
The three basic steps in strategy formulation include (a) setting strategic goals that stem from
5-4. What is corporate culture? How is it formed? How is it sustained? How does it relate to
the corporate mission and vision?
Corporate culture is the shared stories, experiences, beliefs, and norms that characterize an
organization. Factors that form culture can range from the personality of the founder, to the
QUESTIONS FOR ANALYSIS
5-5. Relate the five basic management skills (technical, human relations, conceptual, decision–
making, and time management) to the four activities in the management process (planning,
organizing, leading, and controlling). For example, which skills are most important in
leading?
members present and, perhaps, the types of diversity. Controlling is the one function that ties
5-6. Describe the difference between leadership and management.
Answers will vary in detail, although the theme should be that managers have people
5-7. What contingencies would a major retailer of home improvement supplies need to consider
in planning? How do you think the organization would address those risks?
5-8. Some business people claim that ‗culture trumps mission.‘ What do you think that
statement means and how would that affect the corporate strategy?
Culture is often unstated and invisible, but is also the glue that holds the organization
APPLICATION EXERCISES
5-9. Interview a manager at a local company or read a published interview of a manager. What
are the strategies and skill sets identified? How are that manager‘s background, education,
and experience relevant to the job?
5-10. Critique three mission statements from various companies. Describe how the mission
relates to vision, values, strategies, and culture. How effective do you think the mission
statements are? How useful? How clearly do they reflect the identity of the company?.
Answers will vary, but students should focus on what the message of the mission statement
BUILDING A BUSINESS: CONTINUING TEAM EXERCISE 5-11 TO 5-16
(Learning Objectives 1, 2, 3, 4, 5, and 6 – AACSB – interpersonal relations and teamwork,
analytical thinking, application of knowledge)
In this exercise students are focusing on the expertise necessary to successfully run their
business. They should incorporate information from their SWOT analysis to determine their
TEAM EXERCISE – DREAMS CAN COME TRUE 5-17 TO 5-20
(Learning Objective 4 – AACSB – interpersonal relations and teamwork, written and oral
communication, application of knowledge)
This exercise helps students focus on developing a mission statement and how to derive
appropriate goals based on the company‘s mission.
5-17. Working with your group, develop a mission statement for Dream Vacations. Why is
developing a mission statement important?
5-18. Considering Dream Vacations‘ mission statement and the information provided in the case,
what are the company‘s long-term goals? How should Arturo measure these goals?
5-19. What intermediate goals will help Dream Vacations meet its long-term goals and realize its
mission? What types of corrective action should Arturo take if the company fails to meet
these goals?
The scenario identifies two intermediate-term goals of growing at least 10 percent per year
over the first five years through advertising and referrals, and expanding into multiple offices
within two years. Are these goals that help Dream Vacations meet the long-term goals? If
5-20. Identify Dream Vacations‘ short-term goals. Are short-term goals more or less important
than long-term goals?
Short-term goals are focused on developing relationships with resorts in various areas. Both
EXERCISING YOUR ETHICS: TIME FOR THE AX?
5-21. Which areas of management functions are involved in this scenario? What skills? What
strategies?
5-22. What are the ethical issues in this situation?
5-23. What is the logical, business-based approach for a manager to take in this situation?
Explain your position.
Answers will vary. One extreme would be to take the logical, profit-focused approach and to
charge the highest price the market would bear, relying on the law of supply and demand to
5-24. What would you do, and why?
5-25. How would you describe the culture of this company, based on the limited information in
the scenario?
CASES:
ALPHABET SOUP
(Learning Objectives 1 and 3 – AACSB – application of knowledge, reflective thinking)
5-26. Describe examples of each of the management functions illustrated in this case.
This case cites the example of the two company founders engaging in planning and analysis
5-27. Which management skills seem to be most exemplified in Sergey Brin and Larry Page?
5-28. What role have goals and strategy played in the success of Alphabet?
5-29. How would you describe the corporate culture at Alphabet?
WHEN OLD IS NEW AND NEW IS OLD
(Learning Objectives 3 and 4 – AACSB – analytical thinking, application of knowledge,
reflective thinking)
5-30. As CEOs, both Ullman and Johnson were involved in each of the four management
Students should describe the strategic nature of the decisions that the CEO of JCPenney must
5-31. The text describes a variety of skills that are essential to management. Which two skills do
you think will be most important for new CEO Ellison?
5-32. Do you think that Ron Johnson changed the mission of JCPenney or just implemented new
5-32. What do you think were Ron Johnson‘s biggest mistakes?
5-33. Do you think that Ellison will be successful in rescuing JCPenney, or is it too late?
The last three questions of this case should generate a lively discussion with passionate