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The recent trouble at the Co-Op Bank Group highlight numerous weaknesses amongst the management which have damaged its ethical reputation and USP. “Friendly” banks – that is, a wide variety of types owned by members and customers rather than shareholders – are hugely popular around the world, with an estimated 20 per cent of the market for deposits and loans in Europe alone.read more...»
Last week The Queen and the Duke of Edinburgh visited One Angel Square in Manchester to open the world's "greenest" office, the new £100 m 14-storey headquarters of The Co-Operative Group. Yet within 72 hours, celebrations turned to dismay when The Mail on Sunday printed a story linking The Reverend Paul Flowers, a former Co-Op Bank Chairman with illicit drug use.read more...»
Entrepreneurship, finance, research, corporate culture, marketing, product development, changing management structures are all part of the ingredients in this BBC entrepreneurship feature about the development of Charlie Bingham's Foods.read more...»
"The 20th Century was about dozens of markets of millions of consumers. The 21st Century is about millions of markets of dozens of consumers."
So said Joe Kraus, founder of a search engine called Excite in the middle of the 1990s. Never heard of it? That's not surprising; in 1999 it was a $6.7bn enterprise with hundreds of employees, but a year later the dot-com bubble burst and it disappeared from the market place. But this quote is one of in an article about Peter Day's Radio 4 Archive programme to be broadcast tonight, and already recommended by Michael Owen in his blog below; forgive me for this repetition, but this is such a brilliant article that it really merits a second look, and hopefully between us we will convince you of that!read more...»
I think it is always hard for students to remember which of the motivation theories is which - whose was the one with the two factors, who was that one with the lightbulbs, and who was the one with the triangle? This article about Maslow might help a bit, as it gives some interesting background on the man and his theory, and adds a bit of Application in the form of business examples for each of the five layers, and also the results of Maslow's own research into people who he viewed as 'self-actualisers'.
There is even an accompanying 30-minute programme, broadcast on Radio 4's 'Health Check' series during the summer, which includes interviews with some of those who worked with the man himself at Brandeis University outside Boston, where Maslow was founding Professor of Psychology.
Could Ryanair be about to make a concerted effort to change its organisational culture? Can the low-cost airline soften its corporate image and improve its customer service performance at the same time?
That appears to be the plan following comments made by Michael O'Leary, Ryanair's controversial Founder and CEO, at the recent Ryanair AGM.read more...»
Say the word e-commerce in the US, UK and many other developed economies and one word usually comes to mind – Amazon. The Seattle-based multinational claims to be the world's largest online retailer. It has highly diversified operations that have taken the business well beyond the original proposition - selling books online. CEO and Founder Jeff Bezos launched Amazon.com in 1995 and over the next two decades Amazon has expanded its retail websites to dominate the market in Canada, the UK, France, Germany and elsewhere.
However, in China, say e-commerce and a different "A" word is on everyone's lips. Alibaba is a private Chinese company that is now the largest business-to-business and consumer-to-consumer company in the world. Amazon might dominate global business-to-consumer online retailing. But, in China, Amazon has a very small market share and it is Alibaba that dominates.
In fact, Alibaba can legitimately claim to be the world’s leading e-commerce business. Reports suggest that Alibaba handled total sales of $170 billion in 2012 – which is more than the transaction value handled by Amazon ($96bn) and eBay ($75bn) combined!
After more than eight years of effort, Amazon has less than 1 per cent of China’s $196bn e-commerce market. Alibaba is estimated to have a market share of nearer 75 per cent.
To put this into perspective, China’s e-commerce market is already the largest in the world and by 2020 is forecast to be bigger than the existing markets in the USA, UK, Japan, Germany and France combined. So Alibaba’s market share of over 70% makes it a very big player indeed.read more...»
It's all over for Nokia CEO Stephen Elop and his 32,000 employees in the core of Nokia - their mobile phones (handset) business. After several years of struggling to turn the business around in the face of intensive competition from Apple, Samsung, Google, Huawei and others, Elop has decided the best option is to sell the business to Microsoft.read more...»
This short BBC clip is an excellent introduction to some of the key skills and abilities that are required to be the leader of a complex business.read more...»
Over the summer I’ve kept spotting reference to an article that appeared in The Economist that has caused me to smile and reflect. With a busy term coming up, the advice seems very welcome: the biggest problem in the business world is too many distractions and interruptions, too many things done for the sake of form, and altogether too much busy-ness.
I’m well aware of my own time wasting habits, and I see plenty of it going on around me too. Here are some of the key points that are raised:
Microsoft has announced that its CEO Steve Ballmer will retire from the business within the next 12 months. The Microsoft share price rose 9% on news of the announcement which might tell you something about how investors feel about how Ballmer has performed as CEO in recent years!
Lots will be written about Ballmer's time at Microsoft and the resulting strategic review which the business will inevitably conduct when a new CEO is appointed.
However, for now, enjoy a selection of videos which show Steve Ballmer in action! He has certainly attracted lots of attention for his unusual leadership style!read more...»
I highly recommend teachers and students reading this new profile of Apple CEO Tim Cook. It is packed with insights into the leadership challenges faced by Cook, his leadership style and the link with organisational culture change at Apple.read more...»
This 5 minute video from the excellent Andrew Hill of the FT should be required viewing for every advanced business student.
With an increasing number of companies refocusing their priorities beyond profit and towards the welfare of their suppliers, employees and the planet, Andrew Hill, management editor of the FT, asks what the repercussions are for business. Superb.read more...»
I've just come across a web page that steered me onto one of my favourite topics (see below). I started putting links together here which I intended to be about management in general, but the list has become dominated by an issue that I find particularly interesting: how the physical design of the workplace influences the performance of organisations. This is a debate that you can take in so many different directions, from organisational structures through to motivation and workforce performance.read more...»
Excellent BBC2 business documentary last night on the growth of low cost airlines 'Flights and Fights: Inside the Low Cost Airlines'. The programme explores how Ryanair and Easyjet have transformed the European airline industry.
A good visual way of analysing your BUSS4 research organisations for both Section A and B is to relate them to different concepts or models. (apologies for the drawings in the picture above) To go even further could be to link elements of some of these models and concepts together which can give a more in-depth, holistic view of the organisations in relation to some key BUSS4 topics. I have started to get my students to relate them to the following 6:
The link between Leadership, Values and Organisational Culture will be a familiar one for BUSS4 students. This video “Simon Sinek: How Great Leaders Inspire Action” from TED talks is a simple and really interesting way to make these links. It’s summed up by a “Golden Circle” and 3 words: What, How and Whyread more...»
At what stage does organisational culture need to fundamentally change?
If culture is like the DNA of an organisation, then you can argue that the culture of every organisation is unique. However, it is still possible to group certain styles or types of organisational culture. By doing, students are provided with an opportunity to compare and contrast - a vital exam skill!
Let's look at an obvious basis for comparison - strong versus weak culture.read more...»
The Co-Op has keen to highlight their ethical credentials as a key part of its marketing and positioning strategies. Supporters claimed that its mutuality was a more desirable form of ownership than PLCs.
The Banking Division has run into difficulties, and there have been significant changes in personnel within the last few weeks, in part as a response to major financial problems. On Friday there were reports that it had stopped offering loans to new business customers, and today The Independent on Sunday reported that The Co-Op Group's Finance Director Steve Humes had resigned. This followed the recent resignation of Brian Tootell after Moody's downgraded the Bank's bonds.
Mr Humes The Group Finance Director for the last two years, had been involved in managing the Co-Ops food operations, and may have had insufficient experience of its banking operations. Euan Sutherland the Co-Op's new CEO who was appointed in May, could be about to make significant changes in other key management positions.
The decision to stop lending to new business customer may imply that the there may be insufficient capital to support current obligations let alone new loans. The ethical bank may be about to meet its most serious crisis.
Do you have a set a core values? What deeply held beliefs shape the way you see the world and how you act?
Your core values underpin the way in which you behave, act, and how you live your life. So, if someone asked you to list your two most important values, what would they be?
I ask the question because the concept of core values is essential to understanding organisational culture.
Indeed I would hope that the role of core values would feature in many high-scoring BUSS4 essays for students answering questions about organisational culture – they are important!read more...»
It is relatively easy to identify evidence on how organisational culture can be an intangible asset of a business - a source of competitive advantage and a key reason for a business enjoying industry-beating financial performance.
However, the reverse can also be true. If organisational culture is managed incorrectly or (worse) left un-managed, it can become dysfunctional or toxic. In these situations the organisational culture of a business can become a liability, not an asset. It can even lead to the failure of the business.read more...»
If students are looking for a research example of a business that is truly built around a deliberate attempt to create and nurture a strong organisational culture, they need look no further than online shoe retailer Zappos.
Tony Hsieh - the founder of Zappos (bought by Amazon a couple of years ago) wanted to build a business based around a simple idea. That it - if you get the organisational culture right - then everything else that you need to be successful will fall into place.
Is he right?read more...»
Right. That's it. I'm off to work at Ikea. I just know I'd fit in...read more...»
“Our strategy is delivering. The transformation of Royal Mail is well underway”.
That’s the view of Moya Greene, CEO of Royal Mail, as she announced the full year results for Royal Mail to 31 March 2013 today.
As students who attended our BUSS4 Exam Coaching Workshops will recall, I think that Royal Mail is one of the very best research case studies to use for both Section A (organisational culture) and Section B essays in the BUSS4 exam.
The latest financial results of Royal Mail Group are packed full with useful insights and data which could be used effectively to support paragraph points in a BUSS4 essay.
Here are just a few examples:read more...»
How far did the management style of Roberto Mancini contribute to his removal after the FA Cup defeat?
Mancini was the most successful manager of Manchester City's 23 managers hired after the retirement of Joe Mercer in 1971. He took the club to 2 FA Cup Finals, and City thrashed Manchester United 6-1 on the way to winning the Premier League with almost the last kick of the 2011-12 season.read more...»
We've previously highlighted the arrival of Harriet Green as the new CEO of Thomas Cook as a great research example for business students. New CEOs - particularly those recruited externally - tend to dive straight into "strategic reviews" which then result in changes in strategic direction, disposal of non-core businesses etc. Harriet Green is no exception. And in this YouTube clip, she outlines her proposed strategy for the ailing travel industry business.
The clip is almost two hours in length. However, it is the first section (from about 3 minutes 30 in) which is particularly interesting and relevant for business students. You get a strong sense of Harriet Green's personality from the presentation and a clear statement of her strategic objectives for the business.read more...»
Can Apple's CEO Tim Cook provide the right leadership to sustain the firm's reputation for innovation?
That's the question posed in this short Businessweek article which looks at three key factors which may determine whether Apple's innovative culture can be sustained and nurtured.
It's a good piece and well worth reading not just as an example of analysis and evaluation!read more...»
That may be over-stating it a bit, but it's not often that the BBC's Political Editor calls a football manager "...the mastermind of one of Britain's greatest brands." Nick Robinson is clearly somewhat biased, as a self-confessed Man United fan, but the piece he wrote on Thursday to justify his off-the-cuff comment, in which he did jokingly suggest that Sir Alex Ferguson was 'the greatest living Briton', suggests that students of leadership, management and business culture should reflect on what led to his success.
One of the strengths and a key component in the Co-Op Bank's USP after recent banking problems - sub-prime lending, collapse of Northern Rock and LIBOR rate fixing, was its emphasis of ethical banking.
This new blog entry from the HBR is useful research material for students wanting to develop the link between organisational culture and competitive advantage.read more...»
Students attending our BUSS4 exam coaching workshops on Organisational Culture will be familiar with Jeff Skilling - the former CEO of Enron which collapsed so spectacularly over a decade ago.
The Enron collapse was closely linked to a strong, through ultimately toxic organisational culture that developed at Enron, which was an online energy trading business that rose quickly to become the 7th most valuable firm in the US.
The culture at Enron, described so powerfully in the film The Smartest Guys in the Room (and Broadway play of the same name) was a tough culture - a VERY tough culture. Students may recall the infamous policy of "rank and yank" in which 15% of Enron staff were dismissed each year as a result of Jeff Skilling's PRC (Performance Review Committee).
Skilling rose to the position of CEO in 2001 only to abruptly resign six months later. Soon after that, Enron collapsed in one of the most notorious corporate scandals of all time.
Jeff Skilling was sentenced to 24 years imprisonment back in May 2006 after he was found guilty on 19 counts of securities fraud, conspiracy, insider trading and lying to auditors.
However, it now looks likely that Skilling will end up serving only 10-11 years of his sentence. The news clip below explains why in more detail as does this news article from the BBC.read more...»
I've become increasingly convinced from recent discussions with major accountancy firms and other major employers that workplace learning is going to challenge the preeminence of universities and colleges when it comes to obtaining higher level qualifications. The emergence of some industrial-strength Higher Apprenticeship programmes recently is a sign of that. And so to is the news that John Lewis Partnership is to extend its programme of workplace learning to offer Level 6 (university degree level) qualifications for some of its management.
This story would provide the basis for some excellent analysis by students exploring how and why John Lewis Partnership has decided to extend its internal training programmes.
Some clues can be found in extracts from the JLP press release: for example;
The so-called "University of John Lewis" will also offer a number of other development initiatives through its ‘skills programme’, which will include training in product knowledge, line management and leadership. read more...»
"Our partners give us our competitive edge, and if we want them to stay with us for the long term, we need to make sure that they have the right skills to meet the challenges we face in an evolving retail environment."
For Sony's CEO Kazou Hirai - a promise is a promise.
Back in April 2012, when Kazou Hirai took over as CEO from Sir Howard Stringer, he pledged to restore Sony's troubled Consumer Electronics division to profitability within one year.
In a significant programme of retrenchment, Sony has shed over 10,000 jobs (about 6% of the workforce), sold off major property assets and substantially cut production at the heavily loss-making Sony Television business (which is a significant part of the Consumer Electronics division). The result is expected to be Sony's first corporate profit for five years when it reports final result for the year to 31 March 2013 in May. However, the Consumer Electronics division remains unprofitable - Sony has not met its objective.
The reaction by Hirai? It is reported that forty of Sony’s top executives, including Hirai, are to give up bonuses worth between 30 and 50 per cent of their pay. The decision will save Sony around $10m, which is not particularly significant in financial terms.read more...»
It is often claimed that the organisational culture of a business is formed and developed in the "shadow of the leader". And perhaps nowhere is this more true than the organisational culture of Ikea which was founded by Ingvar Kamprad.
Here is a some evidence which helps explain the concept and also tells us more about the core values that have been used to build the Ikea business.read more...»
Kazou Hirai took over as CEO of Sony on 1 April 2012 replacing Howard Stringer. Hirai inherited a business with many problems and experiencing heavy losses. What has he done in his first year?read more...»
Lots of great information from Schultz here and insights into his business strategy. Many insights too into Schultz's personal background and his views on what it takes to be a successful entrepreneur.
Put simply, this interview has everything! Organisational culture; entrepreneurship; CSR; emerging markets; retrenchment; ethics.read more...»
Here is one of my all-time favourite video clips for business studies, featuring one of my business heroes - Herb Kelleher.
You might not have heard of Herb Kelleher. However, I highly recommend that you take a little time to find out more about him and the business he founded - Southwest Airlines. It is a fantastic example of a business which has identified organisational culture as a source of sustainable competitive advantage.
Kelleher identified the need for an employee-centered culture at Southwest as the way in which his airline could deliver outstanding customer service. Put simply, Herb believes that the "business of business is people".
In this short, five minute video, Herb explains why putting employees at the centre of Southwest's culture is so important to him.
About a minute into the video, Herb demonstrates a superb example of "analysis" using a logical chain of argument. The argument goes something like this:
...If the employees come first, then they’re happy…. A motivated employee treats the customer well. The customer is happy so they keep coming back, which pleases the shareholders.
A simply stunning video, that stands the test of time.read more...»
The organisational structure and organisational culture at John Lewis Partnership, based around employee ownership, is distinctive and highly successful. But why? What is it about the "partnership" model at JLP which drives sales and customer service so high?
In these JLP videos, the partners themselves explain their perspectives on the business benefits of partnership in a highly competitive retail environment. The business benefits of the model are examined in more detail in the second video.
Some fantastic insights into culture here as well as the motivational impact of employee ownership.read more...»
Terrific insights here from Andy Street, the CEO of John Lewis Partnership, about how the concept of trust is so important in business success. Some short, sharp points here which help identify elements of the organisational culture at John Lewis Partnership and perhaps point to some of the reasons why JLP has been so successful in recent years despite the economic downturn. Essentially Andy Street sees trust as a source of competitive advantage. But it is hard won, and easily lost! Businesses - take note!read more...»
This is superb stimulus material for any business lesson strategic change and change management. The short animated video reports back on a recent Economist debate about whether businesses are too slow to adapt to change. It features some of our favourite examples and case studies, including Kodak and HMV. Some great quotes and simple, powerful ideas here.read more...»
This week's edition of The Bottom Line, hosted by Evan Davis on Radio 4, is about business turnarounds. The three guests this week have all been involved in rescuing companies and they share
their experiences, in which the culture of the organisation feature heavily. For those who are picking up on the tutor2u 10 companies to study, it is particularly useful as the first of these is Adam Crozier, Chief Executive of ITV
(and former CEO of Royal Mail). Different scale is offered by James Eden, Chief Executive and owner of
clothing brand Private White VC, and Nick Sanders, Head of Portfolio at
private equity firm Better Capital. Well worth getting students to listen and to write some compare-and-contrast notes.
Royal Mail is fast becoming a must-cover case study for advanced business students. Royal Mail is now well into a significant transformation programme under the leadership of CEO Moya Green. The business is preparing for and approaching privatisation and faces intense competition in the profitable parcels business.
So I thought I'd dig out a few links which might help students get started with exploring the Royal Mail case study.read more...»
The stated mission, vision and values of a business should (in theory) provide a key insight into the strategy and culture of a business. Of course, it's not always the case that stated vision & values are consistent with the way a company does business (think...Enron). However, for many successful businesses there is a clear and sustained link between the two.
Set out below are a selection of web links that provide insights directly from the featured businesses into their vision, values and culture.read more...»
Bureaucracy. It’s a pretty unloved word these days (not least because it’s quite tricky to spell). It suggests red tape, barriers to action, paperwork, process, and lethargic responses to change, with petty jobsworths hindering progress. It’s anti-innovation, it’s a means of state control, it’s a Kafka-esque, rule-based system ignorant of common sense. We talk of companies that have become too slow and have a deeply entrenched bureaucratic or role culture, and need slimming down to become more responsive to the market. We’re told it’s a bad thing.
Or is it?read more...»
Teleworking is a great concept to discuss in Business Studies, as the topic covers everything from organisation to leadership, motivation and business culture. Recently I wrote about trouble for teleworkers, following after the findings of a report that suggested that many potential teleworkers fret that time away from the office means missing out on promotion opportunities. Apparently, the report by the London Business School finds that companies still reward ‘presenteeism’; telecommuters are less likely to be promoted because they aren't present in the office.
Now we learn that Yahoo are to place severe restrictions on opportunities for teleworking, promoting more interesting debate and coverage. For one thing, the boss of Yahoo is female. You might think this point irrelevant, but to many commentators, this is yet another angle to a fascinating debate….read more...»
We've been focusing on Southwest Airlines during our BUSS4 CPD workshops on Section A Organisational Culture - and in particular on Herb Kelleher, the enigmatic CEO of the highly-successful low-cost airline.
Kelleher's obession with building an employee-centred culture provides stunning evidence for students who want an example of how a positive corporate culture can lead to business success.
Can flying be fun? That's the goal of Kelleher, who is determined to offer reliable on-time service at an affordable price. In this classic archived video from CBS, Steve Kroft profiles the airline president and his innovative approach to the business.
Stick with this video - it is quite long and little dated. But the insights for business students are priceless.read more...»
What is the link between organisational culture and long-term, sustained business success? The evidence of the corporate culture at Germany's mittelstand companies might help answer this question.
Mittelstand firms employ almost two-thirds of workers in Germany, so they are core to understanding the relative success of the German economy.
Most companies in the mittelstand are family-owned. They are "not too big, not too small". Family control enables quicker decision-making and a longer-term perspective to be taken.
Germans use the word "mittelstand" for the millions of middle-sized companies that form the backbone of their booming economy, and some in Britain reckon the model could teach UK industries a few lessons.Below are a three short videos which explain the mittelstand sector in Germany - packed full with useful evidence and insights for students! read more...»
I am regular listener to Cambridgeshire’s Star FM Business Hub, which covers some amazing topics for small businesses and is a regular feature of my BTEC lessons. This week's episode however contained a large segment on the importance of culture in a business' success, which is particularly pertinent for BUSS4.
The interview with William Rogers, CEO of UKRD group (owner of Star Radio), gives a fantastic insight into how leaders can create the right culture for a business to succeed. It can be found here and starts 27 minutes in.read more...»
I've been researching the rapid growth of Chinese technology firm Huawei this week and came across a feature of Hauwei#s leadership structure which stopped me dead in my tracks. Most big companies have one CEO (Chief Executive Officer). But, Huawei has decided to do things differently. It has decide to have three!read more...»
Johnson & Scholes in their model of the Cultural Web of an Organisation point to the importance of stories as powerful descriptors and shapers of the culture of a business.
The more organisations you work in or with, the more you come across stories. They are told about a business to reinforce (or deny) a company's vision, values and way of doing business. Told well (and often) they help send strong messages to those who hear the stories, particularly those who work inside the business or customers who build loyalty to a business & brand.
One of the most famous "stories" in corporate culture is that of the Hewlett-Packard Garage at 367 Addison Avenue, Palo Alto, California. The HP Garage is known as the "birthplace of Silicon Valley".
As HP today describe the Garage:
Tucked away on a quiet, tree-lined residential street near Stanford University, the HP Garage stands today as the enduring symbol of innovation and the entrepreneurial spirit. It was in this humble 12x18 -foot building that college friends Bill Hewlett and Dave Packard first pursued the dream of a company of their own. Guided by an unwavering desire to develop innovative and useful products, the two men went on to blaze a trail at the forefront of the electronics revolution.
Barclays new CEO Antony Jenkins has announced details of his strategic review in the wake of Libor-rigging, the bank's role in PPI mis-selling and other scandals.
Jenkins has pledged to rebuild the bank's reputation by fundamentally changing the culture under which its traders operate, including changes to payment protection insurance selling and staff bonuses.read more...»
Is there a better example of a firm that failed to embrace the need for change in the face of rapid technological advances than Kodak?
Kodak is a great example to use with students to introduce the concept of technological change and this video provides a thought-provoking piece of stimulus material!read more...»
A brief interview here with Stephen Elop in January 2013 which will be useful for teachers & students following the progress of Elop's turnaround strategy for Nokia.
Nokia is currently going through a significant change programme. Elop explains how the firm has focused Nokia employees on three key behaviours that are expected to drive the change in culture that Nokia needs: accountability (taking responsibility), urgency (doing things quicker) and empathy (being less arrogant).
Elop also explains briefly how the external environment is providing increasing threats to Nokia which needs increased planning and thinking.read more...»
When Judith McKenna (COO Asda) joined us for the Business Teacher National Conference in June 2012 I remember noting down how a strong corporate culture was identified as being a key competitive strength of both Asda and its parent company Walmart.
It's interesting looking through a series of useful resources on YouTube how the corporate culture of the firm, now the world's largest retailer, comes through particularly strongly from the annual Walmart "shareholders" meeting.read more...»
The banking sector has come under intense scrutiny in recent years as a result of a series of scandals which have lifted the lid on excessive risk-taking, illegal and unethical behaviour. Corporate culture has been blamed for many of the issues that have come to light.
In this article in the Guardian, five "experts" are asked for their views on how banks can change their culture.read more...»
If you had lasagne last night you might be wondering if it was the last remains of the non-running hurdler "100% Pure Beef". Findus have a major problem to resolve after tests showed that their lasagne had been made from horsemeat.
If there is a better video introduction to the concept of organisational culture than this one, please send me the link!read more...»
The Royal Bank of Scotland has fined been fined £390m for attempting to rig Libor, the inter bank lending rate. The Financial Services Authority says wrongdoing was taking place two years after it was bailed out by the tax payer.
Stephen Hester, chief executive at RBS, said after the settlement: "Libor manipulation is an extreme example of a selfish and self-serving culture that took hold in parts of the banking industry during the financial boom."
The corporate culture inside RBS during the financial boom has certainly been laid bare by the Libor rate-fixing scandal.read more...»
Strong & iconic brands appear to be a big part of the attraction of the corporate culture at Mars, as illustrated in this super short video:read more...»