Corporate culture and strategy in the electronics industry

Several companies have been observed to grow and prosper over time, reaching a pinnacle of success only to begin a decline. Many of these companies had superior technology and large and well-funded strategic planning groups, yet they ran into trouble. Several authors have suggested that a strong culture is almost synonymous with success (Kotter 1992), yet even companies with strong cultures, such as IBM, have run into difficulties. These difficulties were serious enough to cause the Board of Directors to restructure the company and to name a new CEO. The new CEO, Gerstner, began by altering the culture in order to turn IBM around, "culture" being the correct or accepted way of thinking about a situation. It was seen as necessary to alter the culture before attempting a new strategic direction.; The intent of this study is to develop a framework for understanding the relationship of culture and organizational strategy from a systems perspective. The Integrated Pyramid Model was developed to explain the constraints of culture on organizational strategy. Culture is seen as acting as a filter on incoming information from the external environment as well as from internal strategic mandates. Corporate culture is fundamental and very difficult to change.; This study utilized in-depth interviews (case study method) with electronics industry executives from five electronics companies as the method for collecting primary data. Firms that have experienced cultural and strategic direction change constituted the sample. An industry expert panel was utilized and content analysis was performed in developing a framework to represent the interactions of culture and strategy.; Key findings of the research are that the culture of a company is very important to its long-term success. A company performs best when its vision, strategy, and culture are in alignment. Strategic planning is enhanced when a company's culture supports a broad and in-depth communications process, a consensus-building process, a customer-driven focus, and attention to the bottom line. The culture wished for, desired and/or promoted by top management does not always permeate the organization for reasons of growth, personnel turnover and most importantly an inconsistent approach to reinforcing the culture.