The Cultural Factors of Organizational Innovation

Organizational culture is an important but often overlooked aspect of the innovative process. Without the right cultural tone the overall amount and quality of new products and services are likely to be reduced. The strength of the cultural underpinnings influence the success of employee thinking and supports the proper experimental mindset. 

When it comes to knowledge of innovative processes the literature is revealing. Yet there are other contextual factors that influence the success and contribution to such process. The literature is weak on the concept of tacit and difficult to define cultural factors of innovation (Nonaka & Takeuchi, 1995). It is these cultural influences that determines the mental state and commitment to the success of future innovations. 

Those who support that culture are often seen as entrepreneurs.  Such innovative entrepreneurs are risk takers who seize upon opportunities to develop something new (Sarasvathy, Dew, Velamuri & Venkataraman, 2003). It is the creation of new products and solutions to produce higher levels of development for personal and professional gain that seems to take precedence. 

Yet understanding who is willing to create innovation and the process of innovation doesn’t tell us how to engage in innovation on an organizational scale. The research on contextual culture and its impact on innovation are weak. Understanding how organizations develop and create an innovative culture is important for higher levels of performance. 

A case study of Tele by Meissner and Sprenger (2010) looked at innovative from a contextual, procedural and cultural perspective. The purpose was to determine the interdependencies and communication patterns that give rise to organizational innovation. The researchers used interview questions the company to help determine the most appropriate factors in developing this culture. 

-Aversion to experimentation impacts innovative growth within organizations.

-Power dynamics reduced the successful completion of projects. 

-Management education and learning predispositions impacted the effectiveness of innovative cultures. 

Analysis:

Culture factors are not easy to see or determine from standard analytical investigation. However, it is these cultural factors that impact the organizations predispositions to developing innovative products and services. Organizations that have a proper culture will make adequate cultural acceptance for experimentation, minimize power abusers and brokers, and continuously develop their management teams. Failure to provide the right context increases resistance to new ideas and thoughts that leads to higher avenues of revenue generation. 

Author: Dr. Murad Abel

Meissner, J. & Sprenger, M. (2010). Mixing methods in innovative research: studying the process-culture-link in innovation management. Forum: Qualitative Social Research, 11 (3). 

Nonaka, Ikujiro & Takeuchi, Hirotaka (1995). The knowledge-creating company. New York: Oxford

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Sarasvathy, S., Dew, N., Velamuri, R. & Venkataraman, S. (2003). Three views on entrepreneurial opportunities. In Zoltan J. Acs & David B. Audretsch (Eds.), Handbook of entrepreneurship research (pp.141-160). New York: Springer.

The Cost of Embedded Group Networks within the Workplace

Workplace groups create their own values over time through social and economic associations that can damage the efficiency and financial viability of any organization. When organizations develop their own group standards, that lay in productive and accurate perceptions, their premises can encourage higher levels of organizational performance. Inappropriately socialized members often develop their own groups which influence the organizational culture and costs of transactions throughout their networks.  Left untouched the groups’ decisions become less logical and more damaging to the financial success of the total organization. It is important for executives to understand how they groups form and the potential wide reaching problems they can create.

It is first beneficial to define what a group is. Groups perceive themselves as belonging to the same social unit (Lawler, Thye, and Yoon 2008). Their place in society is defined by their shared experiences and understandings. To change a group member’s identity and perceived station in life requires the ability to change both self-perception and the members of their social group. This is one of the reasons why a poor organizational culture can be improved by moving employees to new locations and bringing in fresh members with outside perceptions.

When members see themselves as part of a group they begin to view each other as having similar characteristics and traits that bind them together. The group is a method of moderating self-interest and seeking positive perceptions of each other (Ellemers, Spears, and Doosje, 1997). Once initiated into a group, the members begin to view each other as more worthwhile and having more positive traits than those who exist outside the group.  Within an organization, in and out-group mentality can create encampment, hoarding of resources, and influence the financial success of the entire organization through poor decision making.

This can be expected as groups seek to create advantages for their individual members at the exclusion of competing organizational interests. They do this through the formation of a group network that continues to expand throughout the organization. According to Thye, Lawler and Yoon actors a) perceive the network as a group;  and , b) share rewards and resources with each other when opportunities arise (2011).  Such networks will continue to seek additional rewards and resources even at the expense of their employer and society.

Within the group certain behaviors will produce certain reactions and results from participating members. As long as these behaviors continue to produce the expected results the group members will remain entrusted to each other. The actions that become dependent on the response from other members are called social exchanges (Blau 1964). Groups live and breed these social exchanges and common rules of engagement. Outside intervention by managers and investors can be resented creating difficulty and passive resistance to requested changes.

Since such groups have social, as well as economic purposes, they create higher forms of identity the more these needs are gratified. Such relational commitment further solidifies the identity of group members which separates them from other groups (Cook and Emerson, 1984). Each group has their own relational commitment assumptions that help them define their distinct identities and existence. Outsiders may have difficulty understanding the unique set of underlining assumptions the group is using to define their identity and social interaction.

Over time the group becomes so distinct that their identity creates new realities of perceiving the world. According to social constructionists the group eventually uses their assumptions to create “objective” perceptions of the world (Berger and Luckmann 1966).  The person is thus fully embedded in the group and therefore sees their existence from the vantage point of the group assumptions and uses these assumptions to judge others and make strategic decisions. Any management team, new executive, or consulting firm is seen as an outsider attempting to intrude upon the groups identity which damages self-identity. This is one reason why outside intervention is often staunchly opposed.

Such similarity in subjective truth can define “stickiness” in economic decisions that are weighted and judged against societal norms. Independent objective thought becomes more difficult the more people define themselves based upon their distorted group identity. Such relational identities impact both the sociological and economic transactions of the members (Emerson 1981). Having two different economic approaches within an organization can damage that organizational viability through waste and inefficiency that is rooted in inappropriate premises.

At times the group identity can be so far removed from organizational and societal norms that they run counter to these wider expectations. Socially embedded market transactions can defy rational thought and logic (DiMaggio and Louch 1998). Such logic creates their own market influence based upon information sharing and thought patterns of members who interpret environment actions from a skewed lens. Changing the group identity and thought patterns requires exposing them to new people, methods of needs attainment, and ways of thinking.

Group identity can either encourage productive behavior or be destructive by nature. In organizations group identity that is stronger than organizational norms should concern both executives and investors. Such networks continue to expand their influence and waste of organizational resources by financially and socially feeding group members at the expense of more logical choices. It is through the development of strong cultural assumptions and organizational identity that more effective uses of organizational resources can be achieved.

Berger, P. and Luckmann, T. (1966). The Social Construction of Reality. New

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DiMaggio, P. and Louch, H. (1998). Socially Embedded Consumer Transactions:

For What Kinds of Purchases Do People Most Often Use Networks? American Sociological Review 63:619–37.

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Sociological Review 73:519–42.

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Fostering Cultural Innovation Through Employee Satisfaction

Are satisfied employees more innovative? Research helps to show how fostering the right organization culture leads to both satisfaction and innovation. Such concepts are embedded in social dynamics of a company and create subtle expectations on employees. Those organizations that foster positive interaction and recognition also set the right tone within their populations to overcome market challenges.

Organizational culture can be envisioned as the totality of beliefs, values, knowledge, ideas, and habits that defines the very nature of an organization. Such culture impacts how employees make meaning of their environment and their chosen methods of needs attainment (Olivier, 2008). Through culture an organization can define how it is going to view, understand, approach, and overcome organizational challenges through innovative behavior.

When culture has encouraged beneficial premises that are focused on innovation and problem solving the entire organization can achieve rewards reinforcing additional employee commitment and the financial benefits to the organization. However, before such culture can be appropriately fostered employees should have a minimal level of satisfaction with both the organization and the social structures that exist within the workplace. It is this satisfaction that can lay the framework for expectation and innovation on an organizational socio-cultural scale.

Employee satisfaction can be defined in terms of commitment to the organizations values, the nature of the work, and to other employees. Through this satisfaction and commitment employee will begin to change their perceptions and behaviors to match the needs of their new social group (Adeyinka, Ayeni and Popoola, 2007). Positive social group interactions furthers a sense of unity and similarity in perception and expectations. This can be positive when the workplace fosters constructive ideas or it can be negative when such ideas draw away from self-efficacy.

Employee commitment is further defined through employees complaints, identification with the organization/social group, and overall employee values (Charles, 1986). It is this commitment of values that help employees define their expectations and understanding of the work environment. When commitment to the group entails the ability to produce solutions to problems then innovation becomes a social expectation.

Employee satisfaction also impacts the openness of employees to workplace innovation and its process. Those employees who were satisfied with their jobs also were adaptable, fulfilled and productive which further sets the framework for organizational innovation (Sexena & Vyas, 201). Such employee were open to new concepts as well as the changing roles needed for organizational adjustment. In today's world it is this level of satisfaction and flexibility that creates the commitment to organizational innovative needs and allows companies to adjust to environmental problems.

If one fits within the organization, accepts their social group, and has at least a minimum agreement with the organizational values the employee is likely to be socialized and integrated into the larger cultural network. It is this alignment of values, perceptions and beliefs that create lower organizational costs and can lead to higher levels of motivation and innovation. When signals coming from managers and the organizational structure are  not congruent and confusing the overall socialization process that leads to commitment and satisfaction breaks down.

Positive relationships with management as well as praise and recognition influences both motivation  and satisfaction. A study of 339 employees in ten different wire and cable companies on the Taiwan stock exchange indicated that employees who are innovative, have positive relationships, and receive recognition are more satisfied (Yuan-Duen & Huan-Ming, 2008). The concepts of innovation and satisfaction were based deeply in the environment and its motivational potentials.

The development of higher levels of organizational innovation requires the building of appropriate cultural expectations. Such cultural expectations are based within the social group and the satisfaction the employee feels with his coworkers and managers. By fostering higher levels of positive interaction with organizational members and management, employee satisfaction can raise the level of innovative expectations embedded within the culture. Through solving problems for the self, the social group, and the company an employee can find and make positive meaning out of his/her working life.



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