Practice Session

Topic: Corporate
Orientations and Values
 12:00 – Corporate orientations exercise
 12:20 – Corporate culture intro
 12:30 – Guest speaker
 13:10 – Corporate and national cultures
 13:20 – Explanation of individual project task no. 3
3 Business Orientation

 A company’s orientation represents how much a company attends to the

interests of all its relevant stakeholders, and thus it attempts to address such
interests.

 Different businesses apply different orientations, depending on their

individual goals and strategies.

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4 Corporate orientations
Case Boeing

 Which orientations towards stakeholders can you identify? Why did Boeing loose value?

Boeing was one of the most financially successful members of the Dow Jones Industrial Index between
1960 and 1990. Yet, financial goals or financial controls had little role in Boeing´s management over this
period. CEO Bill Allen was interested in building great planes and leading the world market with them:
“Boeing is always reaching out for tomorrow. This can only be accomplished by people who live, breathe,
eat and sleep with what they are doing.” Allen bet the company on the 747, yet when asked by non-
executive director Crawford Greenwalt for financial projections on the project, Allen was utterly vague.
“My God,” muttered Greenwalt, “these guys don’t even know what the return on investment will be on
this thing.”
The change came in the mid-1990s when Boeing acquired McDonnel Douglas and a new management
team of Harry Stonechipher and Phil Condit took over. Mr. Condit proudly talked of taking the company
into “a value-based environment where unit cost, return on investment, shareholder return are the
measures by which you´ll be judged.”
The result was lack of investment in major new civil aviation projects and diversification into defense and
satellites. Under Condit, Boeing relinquished market leadership in passenger aircraft to Airbus, while
faltering as a defense contractor due partly to ethical lapses by key executives. When Condit resigned on
December 1, 2003, Boeing´s stock price was 20 percent lower then when he was appointed.
07.11.2022
5

Shareholder Model Stakeholder Model

Investors
Investors

The Public Suppliers

Management
Management

Associated
Companies Employees
Associated
Employees Companies
Customers Suppliers
The Public
Customers

Principles of Mgmt 07.11.2022

 Corporate culture
 Corporate culture refers to the beliefs and behaviors that determine how a company's
employees and management interact and handle outside business transactions.

 Organizational culture is the collective effect of the common beliefs, behaviours, and values of
the people within a company.
Those norms within any organization regulate how employees perform and serve customers, how
they co-operate with each other, whether they feel motivated to meet goals, and if they are
sincerely into the company's overall mission. How are employees getting their work done?
Independently or collaboratively? Do employees feel inspired, committed, and engaged, or
annoyed, overworked, and underappreciated? (Groysberg, Lee, Price & Cheng, 2018)

 Organization culture is the characteristic and the tangible personality originated inside every
organization.
 Even If we are not familiar with companies like Starbucks, Google or WWF, their names
represent the taste of their workplaces, the attitude, the unwritten protocol of interactions and
the company values.
7 Can you guess a company?

Focus on the user and all else will follow.

It’s best to do one thing really, really well.
Fast is better than slow.
Democracy on the web works.
You don’t need to be at your desk to need an answer.
You can make money without doing evil.
There’s always more information out there.
The need for information crosses all borders.
You can be serious without a suit.
Great just isn’t good enough.

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8

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 Answer - Google
10 Can you guess a company?

Creating a culture of warmth and belonging, where everyone is welcome.

Acting with courage, challenging the status quo and finding new ways to
grow our company and each other.

Being present, connecting with transparency, dignity and respect.

Delivering our very best in all we do, holding ourselves accountable for results.

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11

Principles of Mgmt 07.11.2022

 Answer - Starbucks
Guest speaker

Tanya Fiodarava- Strategic Partnership Lead

for TikTok
14 Corporate culture and national culture
Example of IKEA
 IKEA’s corporate culture reflects Swedish roots coming from Småland in
southern Sweden. People living here are hard-working, down-to-earth, help
each other and live in a close contact with nature around.

 One of IKEA’s corporate values is - Caring for people and planet

We want to be a force for positive change. We have the possibility to make a
significant and lasting impact - today and for the generations to come.

Principles of Mgmt 07.11.2022

 Try to match national culture dimensions of Sweden with the other
corporate values of IKEA (see the next slide)
 Simplicity
Hofstede’s dimension for Sweden A simple, straightforward and
16 down-to-earth way of being
High Femininity is part of our Småland
It stands for a preference for cooperation, modesty,
caring for the weak and quality of life.
heritage. It is about being
ourselves and staying close to
reality. We are informal,
Togetherness pragmatic and see
Low Uncertainty avoidance Togetherness is at bureaucracy as our biggest
Schedules are flexible, hard work is undertaken
when necessary but not for its own sake, precision
the heart of the enemy.
and punctuality do not come naturally, innovation is IKEA culture. We
not seen as threatening. are strong when
we trust each
other, pull in the
same direction Different with a meaning
Low Power distance
Hierarchy for convenience only, equal rights, and have fun IKEA is not like other
superiors are accessible, management facilitates together. companies and we don’t
and empowers. Power is decentralized. Employees want to be. We like to
expect to be consulted. Control is disliked and
attitude towards managers are informal.
question existing solutions,
Communication is direct and participative. think in unconventional
ways, experiment and dare
to make mistakes - always
for a good reason. 07.11.2022
 Answer:
17 Hofstede’s dimension for Sweden
High Femininity
It stands for a preference for cooperation,
modesty, caring for the weak and quality of life.
Low Uncertainty avoidance
Schedules are flexible, hard work is undertaken
when necessary but not for its own sake,
precision and punctuality do not come naturally,
innovation is not seen as threatening.
Low Power distance
Hierarchy for convenience only, equal rights,
superiors are accessible, management facilitates
and empowers. Power is decentralized.
Employees expect to be consulted. Control is
disliked and attitude towards managers are
informal. Communication is direct and
participative.
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IKEA Values
Togetherness
Togetherness is at the heart of the IKEA culture.
We are strong when we trust each other, pull in
the same direction and have fun together.
Different with a meaning
IKEA is not like other companies and we don’t
want to be. We like to question existing solutions,
think in unconventional ways, experiment and
dare to make mistakes - always for a good
reason.
Simplicity
A simple, straightforward and down-to-earth way
of being is part of our Småland heritage. It is
about being ourselves and staying close to
reality. We are informal, pragmatic and see
bureaucracy as our biggest enemy.
07.11.2022
18 Analysis of Example 3

 Analyze corporate values and orientations in one letter to the shareholder.

 Take one letter to the shareholders (will be sent via email on 2.11)
 Read and underline key words
 Reflect on cultural values and corporate orientations that are addressed in the
letter
 Write one page describing what you identified and use examples from the letter
to show why you identified them
 (individual task 10%)

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 !!! – read the case Robin Hood before the session tomorrow (8.11)