An organizational culture assessment of viettrans haiphong - master of business administration thesis

vietnam national university, HANOI school of business Pham Thi Phuong Hieu An organizational culture assessment of viettrans haiphong master of business administration thesis Hanoi - 2007 vietnam national university, HANOI school of business Pham Thi Phuong Hieu An organizational culture assessment of viettrans haiphong Major: Business Administration Code: 60 34 05 Master of business administration thesis Supervisors: DR.VU HUY THONG Ha Nguyen, MBA Hanoi – 2007 TABLE OF CONTENTS ACKNOWLEDGEMENTS i ABSTRACT ii TÓM TẮT iii TABLE OF CONTENTS iv LIST OF FIGURES vi LIST OF TABLES vii INTRODUCTION Statement of the Problem Objectives and Aims Research question Scope of work Data sources and Processing Methods Significance Limitations 9 Expected results 10 10 Outline of thesis 10 CHAPTER 1: LITERATURE REVIEW 12 1.1 Introduction 12 1.2 Corporate Culture 12 1.3 Reasons for a Culture Assessment 20 1.4 Effects on Organizational Performance 23 1.5 Trust & Culture 27 1.6 Changing Organizational Culture 28 1.7 Summary of Literature Review 33 CHAPTER 2: METHODOLOGY 35 2.1 Introduction 35 2.2 Study Population 35 2.3 Instrument Design and Structure 35 2.4 Data Collection Methods 37 2.5 Response Rate 37 2.6 Data Analysis 37 CHAPTER 3: RESULTS 39 3.1 Overview of Viettrans Haiphong 39 3.1.1 3.1.2 Introdution 39 Current Situation of Organizational culture in Viettrans Haiphong 42 iv 3.2 3.2.1 3.2.2 3.2.3 3.2.4 3.2.5 Results 44 Demographic Information 45 Fist category: Mission 47 Second category: Adaptability 51 Third category: The Involvement 54 Forth category: Consistency 58 3.3 Identify concern areas 61 CHAPTER 4: RECOMMENDATIONS 65 4.1 Creating change 65 4.2 Customer orientation 66 4.3 Core values 66 4.4 Coordination and Integration 67 4.5 The Company appearance 67 4.6 Strategic Plan 67 CONCLUSIONS 70 FURTHER RESEARCH 71 REFERENCES 73 APPENDIX : Corporate culture survey of Viettrans Haiphong 76 APPENDIX 2: Survey results 81 v LIST OF FIGURES Figure 1.1: Levels of Organizational Culture [Adapted from Schein 1980; Schein 1985] 13 Figure 1.2: Three levels of Culture [Schein 1992, p.17] 15 Figure 1.3: Research based model [Denison 2003, www.denisonculture.com] 17 Figure 3.1: Organizational structure of Viettrans Haiphong [Viettrans Haiphong] 41 Figure 3.2: Total response rate of the survey 46 Figure 3.3: Year of service 46 Figure 3.4: Strategic direction and Intent 47 Figure 3.5: Goals and objectives 49 Figure 3.6: Vision 50 Figure 3.7: Creating change 51 Figure 3.8: Customer focus 52 Figure 3.9: Organizational learning 54 Figure 3.10: Empowerment 55 Figure 3.11: Team orientation 56 Figure 3.12: Capacity development 57 Figure 3.13: Core values 59 Figure 3.14: Agreement 60 Figure 3.15: Coordination and Integration 61 vi LIST OF TABLES Table 1.1: Four traits in Denison Model [Denison 2003, www.denisonculture.com] 18 Table 3.1: Viettrans Haiphong’s business results in years [Viettrans Haiphong] 39 Table 4.1: Action plan for implementing recommendations 69 vii INTRODUCTION Statement of the Problem Viettrans Haiphong has been part of Vietnam national foreign trade forwarding and warehousing corporation for 37 years Due to its quite long time existence, recent increased desire to change; need for sales growth and development when it has just equitized at the end of 2006 and reinforces its operation to grasp the chance from the event of joining WTO; and lacks of assessing the organization’s culture in the past, an assessment is needed Objectives and Aims This research is implemented to obtain the two purposes: evaluating the current organizational culture at Viettrans – Haiphong and assessing if a change in culture is needed Finding out all the problems in Viettrans Haiphong’s organizational culture, the researcher has some aims including: provide recommendation for decision-making during strategic planning and establish measures for benchmarking and evaluating changes in The Company over time Research question The researcher will go to find the answer for two questions: ―What is the current situation of Viettrans Haiphong’s culture? Should Viettrans Haiphong adjust or change its current culture for development?‖ Scope of work This research studies organizational culture of Viettrans Haiphong in July, 2007 in Viettrans Haiphong Data sources and Processing The data is collected from two sources: Primary (information is conducted directly from interview and survey to find out the opinion of Board of Directors, managers and employees on the current organizational culture of Viettrans Haiphong) and Secondary (study documents related to Labour regulations, Polices and others reports of The Company; documents and previous studies about organizational culture and others) Data is process by excel, charts to summary and finally is analyzed for findings Methods The method will be based on researching real case study of Viettrans Haiphong and use questionnaire that is built based on theory of Denison Culture Model and Interview will also be used when necessary Significance Normally, the beliefs and values actually displayed of The Company is not consistent with what The Company wish and try to achieve Thus, this research will help The Company to be able to determine the gap between its current culture and the culture it needs to succeed and help The Company in building criteria or measures to evaluate its culture now and future as well by a culture assessment with a well-designed survey for its employees Limitations The limitations of this research are the time when implementing It can only cover the survey on members of Viettrans Haiphong in 2007, it will lack the opinion of people who has work for Viettrans Haiphong from its start up to help research have an more completed picture about organizational culture of Viettrans Haiphong Besides, during the time implementing the survey, some employees are absence, so it make the response is not adequate Expected results Firstly, the research want to understanding the current culture of Viettrans Haiphong, then find out the effect of this culture on The Company’s operation and whether it need a necessary improvement or change Lastly, from the findings, the researcher will recommend measures to evaluate The Company’s culture overtime 10 Outline of thesis The thesis includes three chapters:  Chapter – Literature review: This section will summarize the theories related to organizational culture It will give the readers an overview of organizational culture and culture assessment from clearly definition to the benefits of them to the operation of an organization, and the effect on organizational performance and also the need for changing organizational culture Chapter – Methodology: This chapter describes the methodology of procedures used in order to assess the culture at Viettrans Haiphong including the study population, design and structure of the instrument, data collection methods, survey response rate, and methods of data analysis  Chapter - Results: After analyzing the current situation of Viettrans Haiphong, the survey’s results and the data collected from secondary source, the thesis will point out the results about the current problems in Viettrans Haiphong culture in four aspects: Mission, Consistency, Adaptability and Consistency 10  Chapter - Recommendations: Continue to the analyzed findings from chapter 2, this section will suggest some solutions and some measures to evaluate Viettrans Haiphong’s culture over time The researcher hopes that, all the recommendations will be useful and effective for not only Viettrans Haiphong but also for other companies which want to evaluate their cultures for development 11 Denison, D R (2003) Website Retrieved August 6, 2003, 2003, from www.denisonculture.com; Effective Ways to Manage Change in Your Organization (2002) Retrieved December 7, 2003, 2003, (www.socap.org/Publications/Quicktakes/managechange.html) Fairholm, G W (1994) Leadership and the Culture of Trust Westport: Praeger publishers Flanning, I (2001) The Top Ten Ways to Create Powerful Change in Your Organization Retrieved December 2, 2003, 2003, (www.changeyourlife.com) 10 Hathaway, P (2000) Resistance to Change Innovative Leader 11 Juechter, M., Fisher, C., & Alford, R J (1998) Five Conditions for High Performance Cultures Training & Development (May 1998), pp 63-67 12 Kraut, A I (1996) Organizational Surveys (Vol sixth) San Francisco: Jossey-Bass 13 Langdon, D (2003, November 16, 2003) Changing The Company's Cultural Clothes Retrieved November 16, 2003, 2003, (www.hr.com) 14 Lui, K (2003) Organizational Development Class Notes Menomonie 15 Marc, D.-L., & Farbrother, S (2003) Changing Organization Culture, One Face at a Time Public Management (October 2003), pp 14-17 16 Mink, B EdD, (2003) Seminar Fielding Graduate Institute (January 2003) 17 Moran, E T., & Volkwein, J F (1992) The cultural approach to the formulation of organizational culture Human Relations, 45(1), pp 19-47 18 Palmer, S (Fall, 1999) Center Solutions Retrieved October 1, 2003, 2003, (www.greaterorganizations.com) 74 19 Pfeffer, J (1994) Competitive Advantage Through People: Unleashing the Power of the Work Force Harvard Business School Press 20 Porter, M (1980) Competitive Strategy New York: Free Press 21 Richard Hagberg, P D., & Julie Heifetz, P D (2003, 2000) Corporate culture/Organizational Culture: Understanding and Assessment Retrieved November 15, 2003, 2003, (www.hcgnet.com) 22 Roger Harrison, P D., & Stokes, H (1992) Diagnosing Organizational Culture San Francisco: Jossey-Bass/Pfeiffer 23 Schein, E H (1992a) Organizational Culture and Leadership (Second edition) San Francisco: Jossey-Bass 75 APPENDIX APPENDIX : Corporate culture survey of Viettrans Haiphong CORPORATE CULTURE SURVEY Position: Year of service for Viettrans Haiphong: Thank you for participating in this survey We are assessing the organization’s strengths and finding out about its weaknesses Your thoughts and feelings are important input to the organization Your responses will remain anonymous, so please answer with complete honesty Please, give your assessment on the following statements by choosing one of five levels (from to 5) for each statement The higher value it is, the more you show your agreement to the statement Strongly disagree Disagree Normal Agree Strongly agree Strategic Direction & Intent There is a long-term purpose and direction Our strategy leads other organizations to change the way they compete in the industry There is a clear mission that gives meaning and direction to our work There is a clear strategy for the future Our strategic direction is unclear to me Goals & Objectives 76 There is widespread agreement about goals Leaders set goals that are ambitious, but realistic The leadership has "gone on record" about the objectives we are trying to meet We continuously track our progress against our stated goals 10 People understand what needs to be done for us to succeed in the long run Vision 11 Leaders have a long-term viewpoint 12 Short-term thinking often compromises our long-term vision 13 Our vision creates excitement and motivation for our employees 14 We are able to meet short-term demands without compromising our long-term vision 15 We have a shared vision of what the organization will be like in the future Creating change 16 The way things are done is very flexible and easy to change 17 We respond well to competitors and other changes in the business environment 18 New and improved ways to work are continually adopted 19 Attempts to create change usually meet with resistance 20 Different parts of the organization often cooperate to create change Customer focus 21 Customer comments and recommendations often lead to changes 22 Customer input directly influences our decisions 77 23 All members have a deep understanding of customer wants and needs 24 The interests of the customer often get ignored in our decisions 25 We encourage direct contact with customers by our people Organizational learning 26 We view failure as an opportunity for learning and improvement 27 Innovation and risk taking are encouraged and rewarded 28.Lots of things "fall between the cracks" 29 Learning is an important objective in our day-to-day work 30 We make certain that the "right hand knows what the left hand is doing." Empowerment 31 Most employees are highly involved in their work 32 Decisions are usually made at the level where the best information is available 33 Information is widely shared so that everyone can get the information he or she needs when it's needed 34 Everyone believes that he or she can have a positive impact 35 Business planning is ongoing and involves everyone in the process to some degree Team Orientation 36.Cooperation across different parts of the organization is actively encouraged 37 People work like they are part of a team 38 Teamwork is used to get work done, rather than hierarchy 39 Teams are our primary building blocks 78 40 Work is organized so that each person can see the relationship between his or her job and the goals of the organization Capability Development 41 Authority is delegated (uy quyen) so that people can act on their own 42 The "bench strength" (ghe dai, trien lam) (capability of people) is constantly improving 43 There is continuous investment in the skills of employees 44 The capabilities of people are viewed as an important source of competitive advantage 45 Problems often arise because we not have the skills necessary to the job Core Values 46 The leaders and managers "practice what they preach." 47 There is a characteristic management style and a distinct set of management practices 48 There is a clear and consistent set of values that governs the way we business 49 Ignoring core values will get you in trouble 50 There is an ethical code that guides our behavior and tells us right from wrong Agreement 51 When disagreements occur, we work hard to achieve "win-win" solutions 52 There is a "strong" culture 53 It is easy to reach consensus, even on difficult issues 54 We often have trouble reaching agreement on key issues 79 55 There is a clear agreement about the right way and the wrong way to things Coordination and Integration 56 Our approach to doing business is very consistent and predictable 57 People from different parts of the organization share a common perspective 58 It is easy to coordinate projects across different parts of the organization 59 Working with someone from another part of this organization is like working with someone from a different organization 60 There is good alignment of goals across levels Other comments 80 APPENDIX 2: Survey results Demographic Information Total response 79 - 92 (85.87%) Responses 80 60 Actual 72.83 63.04 40 27.17 22.83 20 14.13 ions t a r e Op A tion a r t s i dmin ses n o p s Unre Year of service Number of respondents 43.04 30.38 20.25 6.33 Year Below 10 10 - 20 20 - 30 Mission 81 Over 30 Strategic direction and Intent Our strategic direction is clear to me 67 There is a clear strategy for the future 73 There is a clear mission that gives meaning and direction to our work 67 Our strategy leads other organizations to change the way they compete in the industry 54 There is a long-term purpose and direction 87 (%) 10 20 30 40 50 60 70 80 90 100 Goals and objectives 10 People understand what needs to be done for us to succeed in the long run We continuously track our progress against our stated goals The leadership has "gone on record" about the objectives we are trying to meet Leaders set goals that are ambitious, but realistic There is widespread agreement about goals 71 84 77 70 81 (%) 60 82 65 70 75 80 85 Vision 15 We have a shared vision of what the organization will be like in the future 14 We are able to meet short-term demands without compromising our long13 Our vision creates excitement and motivation for our employees 12 Short-term thinking often uncompromises our long-term vision 75 72 81 66 11 Leaders have a long-term viewpoint 78 (%) 20 40 60 80 100 Adaptability Creating change 20 Different parts of the organization often cooperate to create change 76 19 Attempts to create change usually meet without resistance 32 18 New and improved ways to work are continually adopted 54 17 We respond well to competitors and other changes in the business environment 56 16 The way things are done is very flexible and easy to change 65 (%) 83 10 20 30 40 50 60 70 80 Customer focus 25 We encourage direct contact with customers by our people 77 24 The interests of the customer often get ignored in our decisions 49 23 All members have a deep understanding of customer wants and needs 70 22 Customer input directly influences our decisions 59 21 Customer comments and recommendations often lead to changes 63 (%) 10 20 30 40 50 60 70 80 90 Organizational learning 30 We make certain that the "right hand knows what the left hand is doing." 61 29 Learning is an important objective in our day-to-day work 90 28 Lots of things "fall between the cracks" 61 27 Innovation and risk taking are encouraged and rewarded 76 26 We view failure as an opportunity for learning and improvement 89 (%) The Involvement 84 20 40 60 80 100 Empowerment 35 Business planning is ongoing and involves everyone in the process to some degree 34 Everyone believes that he or she can have a positive impact 33 Information is widely shared so that everyone can get the information he or she 32 Decisions are usually made at the level where the best information is available 31 Most employees are highly involved in their work 61 62 72 82 81 (%) 10 20 30 40 50 60 70 80 90 Team orientation 40 Work is organized so that each person can see the relationship between his or her job and the goals of the organization 71 39 Teams are our primary building blocks 84 38 Teamwork is used to get work done, rather than hierarchy 71 37 People work like they are part of a team 81 36 Cooperation across different parts of the organization is actively encouraged 86 85 10 20 30 40 50 60 70 80 90 100 (%) Capacity development 45 Problems often arise because we not have the skills necessary to the job 61 44 The capabilities of people are viewed as an important source of competitive advantage 72 43 There is continuous investment in the skills of employees 78 42 The "bench strength" (capability of people) is constantly improving 77 41 Authority is delegated so that people can act on their own 87 (%) 20 40 60 80 100 Consistency Core values 50 There is an ethical code that guides our behavior and tells us right from wrong 49 Ignoring core values will get you in trouble 48 There is a clear and consistent set of values that governs the way we business 47 There is a characteristic management style and a distinct set of management practices 46 The leaders and managers "practice what they preach." 85 67 57 72 63 (%) 86 10 20 30 40 50 60 70 80 90 Agreement 55 There is a clear agreement about the right way and the wrong way to things 72 54 We often have not trouble reaching agreement on key issues 53 It is easy to reach consensus, even on difficult issues 62 63 52 There is a "strong" culture 67 51 When disagreements occur, we work hard to achieve "win-win" solutions 84 (%) 10 20 30 40 50 60 70 80 90 Coordination and Integration 60 There is good alignment of goals across levels 72 59 Working with someone from another part of this organization is like working with someone 65 58 It is easy to coordinate projects across different parts of the organization 54 57 People from different parts of the organization share a common perspective 70 56 Our approach to doing business is very consistent and predictable 63 (%) 10 20 30 40 50 60 70 80 Comments and suggestions ―I have work for Viettrans Haiphong for 23 years I am very proud of myself when working for The Company I think the way The Company approach to the new way of working should be quicker to meet the demand of customer, especially, foreign customers‖ 87 ―The Company should have more teamwork and discussions when deciding one problem‖ ―I am a quite newcomer in Viettrans Haiphong (2 year of service), but I love this The Company for its nice working environment I can learn many things from the others who have worked here for long time I have an expectation of giving more training to improve my skills, knowledge to support for my job.‖ ―Sometimes, I not understand clearly about strategic plan of The Company Leaders should give followers more information or explainations.‖ 88