Cultural Controls

From knowledgebase
Revision as of 08:13, 25 August 2020 by Dirkjan (talk | contribs) (Created page with "In Management Control '''''Cultural controls''''' or mutual-monitoring tap into� social pressure and group norms and values. Cultural controls are ef...")
(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)
Jump to navigation Jump to search

In Management Control Cultural controls or mutual-monitoring tap into� social pressure and group norms and values. Cultural controls are effective because members� of a group have emotional ties to one another. Cultures are built on shared traditions;

  • norms;
  • beliefs;
  • ideologies;
  • attitudes;
  • ways of behaving, etc.

Five ways to shape culture:

  • Codes of conduct
    • Codes of ethics; corporate credos, mission statements, etc.;
    • Formal written documents with broad statements of corporate�values, commitments to stakeholders, and the ways in which�top management would like the firm to function.
    • Fundamental guiding principles of the company.
  • Group-based rewards
    • e.g., bonus, profit-sharing, employee ownership of company stock;
    • Cultural controls rather than results controls because the link between individual performance and rewards is weak.
  • Intra-organizational transfers
    • Improve the socialization of individuals in an organization and�inhibit the formation of incompatible goals and perspectives;
    • Improve identification with the organization as a whole as�opposed to subunit identification.
  • Physical and social arrangements
    • e.g., office plans, interior decor, dress codes and vocabulary, etc.
  • Tone at the top
    • Top management statements must be consistent with the culture�they are trying to create, and importantly, their behaviors should�be consistent with their statements.