Environment: Culture, Ethics, and Social ResponsibilityLearning OutcomesLearning Outcomes (cont’d)The Internal EnvironmentFederal Express Mission StatementInternal Environment Means and EndsThe Internal Environment (cont’d)PowerPoint PresentationThe Systems ProcessSlide 10Slide 11Internal Environment ComponentsOrganizational CultureThree Levels of CultureOrganizational Culture (cont’d)Slide 16Slide 17The External EnvironmentThe External Environment (cont’d)Slide 20Slide 21The Organizational EnvironmentBusiness EthicsBusiness Ethics (cont’d)Summary Code of Ethics of Exxon Company, USASlide 26Reorganization and Social ResponsibilityPowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie CookCopyright Copyright © © 2003 South-Western/Thomson Learning. All rights reserved.2003 South-Western/Thomson Learning. All rights reserved.Environment: Culture, Ethics, and Environment: Culture, Ethics, and Social ResponsibilitySocial ResponsibilityEnvironment: Culture, Ethics, and Environment: Culture, Ethics, and Social ResponsibilitySocial ResponsibilityChapter 2Chapter 2Chapter 2Chapter 2Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–2Learning OutcomesLearning OutcomesCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–3Learning Outcomes (cont’d)Learning Outcomes (cont’d)Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–4The Internal EnvironmentThe Internal Environment•Management and Culture–Organizational culture•The shared values, beliefs, and assumptions of how its members should behave.•Mission–A organization’s purpose or reason for being•Top management’s responsibility to develop a mission with clear measurable objectives.•States the unique advantage the firm offers to customers that differentiates it from its competitors.•Is relevant to all stakeholders’ interests.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–5Federal Express Mission StatementFederal Express Mission StatementExhibit 2–1Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–6Internal Environment Means and EndsInternal Environment Means and EndsExhibit 2–2Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–7The Internal Environment (cont’d)The Internal Environment (cont’d)•Resources–Human resources–Physical resources–Financial resources–Informational resources•Systems Process–The method used to transform inputs into outputs.–Process components•Inputs • Transformation • Outputs • FeedbackCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–8Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–9The Systems ProcessThe Systems ProcessExhibit 2–3Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–10The Internal Environment (cont’d)The Internal Environment (cont’d)•Quality–Comparing actual use to requirements to determine value.•Customer value–The purchasing benefits used by customers to determine whether or not to buy a product.•Total Quality Management (TQM)–Focusing the organization on the customer to continually improve product value.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–11The Internal Environment (cont’d)The Internal Environment (cont’d)•Structure–The way in which resources are grouped to effectively achieve the organization’s mission.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–12Internal Environment ComponentsInternal Environment ComponentsExhibit 2–4Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–13Organizational CultureOrganizational Culture•Learning the Organization’s Culture–Heroes – Stories –Slogans –Symbols–Ceremonies•Three Levels of Culture–Level 1: Behavior is the visible level ofcultural influence.–Level 2: Values and beliefs are evident in actions.–Level 3: Assumptions are values and beliefs that are deeply ingrained.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–14Three Levels of CultureThree Levels of CultureExhibit 2–5Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–15Organizational Culture (cont’d)Organizational Culture (cont’d)•Strong Cultures–Have employees who unconsciously know the shared assumptions; consciously know the values and beliefs and agree with them.•Benefit from easier communications and cooperation; unity of direction and consensus.•Danger is becoming stagnate.•Weak Cultures–Have employees who do not behave as expected and do not agree with the shared values.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–16Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–17Organizational Culture (cont’d)Organizational Culture (cont’d)•Managing, Changing, and Merging Cultures–Symbolic Leaders•Leaders who articulate a vision for the organization and reinforce the culture through slogans, symbols, and ceremonies.•Learning Organizations–Organizations with cultures that value sharing knowledge to adapt to the changing environment and continuously improve.•Strong adaptive cultures are created through leadership and open sharing of knowledge and information.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–18The External EnvironmentThe External Environment•Customers–Their needs decide what products businesses offer.•Competition–Competitors’ business practices often have to be duplicated to maintain customer value.•Suppliers–Poor quality suppliers mean poor quality products.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–19The External Environment (cont’d)The External Environment (cont’d)•Labor Force–Quality labor is needed to produce quality products.•Shareholders–The board of directors monitors management and provide direction for the organization.•Society–Businesses are pressured by societal forces to behave in an acceptable manner.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 2–20The External Environment (cont’d)The External Environment (cont’d)•Technology–Firms must stay current on technology to stay competitive and