Merging organizational cultures

In short we can say that the organizational culture is a common perception held by the organizations members, a system of shared meaning. This system of shared meaning is a set of key characteristics that the organization values. Organizational culture is concerned with how employees perceive the characteristics of the culture. During a merger two different organizational cultures have to be combined and after that they have to form a new organizational culture.

In 2001 two big IT manufacturers decided to merge, this was one of the biggest mergers in the history. The problem of the merger was with the merging of the two different business cultures that HP and Compaq had. HP on the one hand was like a family and everything was very friendly, and on the other hand Compaq had a more aggressive culture.Looking at the situation during this merger we can say that the biggest problem was the employees of HP. Because most of the employees worked there for a long time and they strongly believed in their culture, they wanted to hang on to the past situation. They were not used to changes and were very much connected to each other.

The employees of Compaq on the other hand came from a dynamic culture in which they were more used to changes, and along with that the Compaq culture didn’t have a high sociability which means that the employees cared less for there colleagues that were dismissed. We are going to do this by looking at the famous example of the merger between Hewlett Packard and Compaq. Before we can talk about changing organization cultures we must first of all make clear what an organizational culture exactly is. After we made clear what an organizational culture is we are going to introduce HP and Compaq with a brief description of their cultures before the merge, followed by the problems, the causes and the recommendations of the merge.

What is an organizational culture In short we can say that the organizational culture is a common perception held by the organizations members, a system of shared meaning. This system of shared meaning is a set of key characteristics that the organization values. Organizational culture is concerned with how employees perceive the characteristics of the culture. To specify the word characteristics we can show the seven primary characteristics that capture the essence of an organizations culture.

1) Innovation and risk taking: The degree to which employees are encouraged to be innovative and take risks.

2) Attention to detail: The degree to which employees are expected to exhibit precision and attention to detail.

3) Outcome orientation: The degree to which management focuses on results.

4) People orientation: The degree to which management takes there people in consideration when making decisions.

5) Team orientation: The degree to which work is based on teams rather than individuals.

6) Aggressiveness: The degree to which people are competitive rather then easygoing.

7) Stability: The degree to which an organization looks at maintaining the current situation rather then growing. Because a culture is a feeling that you get within a company it can be different for each employee within a company. Mostly this is why within an organization there is a dominant culture and one or more subcultures.

The dominant culture expresses the core values that are shared by a majority of the organizations employees. This means when we are talking about the ‘organizations culture’ we are talking about the dominant culture within the organization. Subcultures within an organization include the core values of the dominant culture plus an additional set of values that are unique to the members of a specific department or a geographical separated group. As long as the core values of the company are widely shared throughout the company it is no problem that there are numerous of subcultures. When the core values are widely shared we can say that an organization as a strong culture.

What different kind of organizational cultures do exist To answer this question I used the four-culture typology model which is made by Goffee and Jones. This model provides some interesting insights on the different organizational cultures and the guidance of potential employees. Goffee and Jones say that two dimensions determine the organizational culture. The first dimension of the four culture typology they call sociability. Sociability is a measure of friendliness.

High sociability means that people will do things for each other without expecting something in return. In a highly sociable culture people will also treat each other in a friendly and caring way. The second dimension in the model is the solidarity. Solidarity is a measure of task orientation. A high solidarity means that employees will not look much at personal preferences, but look at the common interests and common goals. With these two dimensions we can make the four culture typology in which we can distinct four different cultures.