How market forces shape organizational response? (Part 1)

Market forces which can shape the organizational responses include dynamic consumption and production, including technical and socio technological factors such as the organization of work or level of training and qualification of a population.

The company must also identify what is the main competitive strength in order to influence the terms of trade in the market. It must therefore select its customers and suppliers on strategic criteria, if it increases its vulnerability. Here are some relevant selection criteria:

·         The concentration of supply and demand;

·         Sensitivity to price and quality;

·         The risk of upstream and downstream integration;

·         The costs of switching providers (switching costs);

·         The ability to integrate cost increases in prices

Cultural Environment and behavior of Organization

The term culture has been borrowed from anthropology where there is no consensus on its meaning. It is the collection of common views, expectations and beliefs of the members of the organizations. These values and norms which constitute corporate culture are not in writing but are understood by all the members of the organization. Even the newcomers to the organization get to know them either through formal training programs and orientations or from their peers. When members of an organization share the same values, they will become more cohesive and committed to their goals. Such commitment is essential for better performance and productivity improvement. Although it is not visible, corporate culture still exists and influences people and activities in organizations.

Most of the successful organizations use a systematic approach in bringing new members into their culture. Pascle (1985), after examining a number of companies with strong culture, suggests that the following steps in socializing members into the corporate culture:

·         Exercising care in selecting entry-level candidates. Specific traits are sought by looking deeper into the candidates. These traits are tied to success of the company

·         Subjecting the newcomer to humility-inducing experiences in the initial period which will provide an opportunity to question prior beliefs

·         Practical training leading to mastery of one of the core disciplines of the business using promotions as incentives

·         Focus on measuring results and rewarding individual performance

·         Adapting to corporate values which will build trust between the individual and the organization

·         In order to validate corporate culture, folklore are reinforced and events in this history of the company are interpreted

·         Those who move up fast are used as sole models.