The relationship between business-level strategy and organisational culture

Abstract

The purpose of this dissertation is to investigate the relationship between organisational culture and strategy. The organisation is studied from two perspectives to produce a holistic understanding of the strategic process. The functionalist perspective views culture as a variable within a systems viewpoint of the organisation, while the interpretive perspective uses culture as a metaphor to conceptualise and analyse the organisation, By combining the insights from the two perspectives, the organisation is defined as a three-level construct of underlying assumptions, values and beliefs, and physical manifestations. For the purposes of the research, strategy is viewed as a key manifestation of the organisation. Its relationships with the assumptions, values and beliefs are analysed. The overall research problem concerns the concept of the organisation as an integrated whole. By combining theories from the literature and perceptions from the target population, a typology of four organisational forms is developed. Each is a consistent set of underlying assumptions, values and beliefs, and strategy. The research propositions advocate that specific strategies are associated with specific assumptions, values and beliefs, and that the consistency between these wifi influence organisational performance. The propositions are tested in 59 Strategic business Units (SBUs) of organisations listed on the Johannesburg Stock Exchange (JSE). By collecting data from a variety of sources, the organisations’ assumptions, values and beliefs, and strategic orientations are measured. These are then tested for consistency, and compared to the overall level of organisational performance. The findings suggest that organisations may be considered as integrated wholes, and that a degree of consistency exists in organisational assumptions, values and beliefs, and strategy. Furthermore, certain strategies are associated with certain cultures, and the consistency between these is associated with superior economic performance. The study concludes that an integrated perspective of the organisation produces valuable Insights Into the strategic process. These include an enhanced view of the organlsation-environment Interface as well as guidelines for the management of strategic change.