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CHAPTER 4 • THE INTERNAL ASSESSMENT 99

An organization’s culture should infuse individuals with enthusiasm for implementing
strategies. Allarie and Firsirotu emphasized the need to understand culture:
Culture provides an explanation for the insuperable difficulties a firm encounters
when it attempts to shift its strategic direction. Not only has the “right” culture
become the essence and foundation of corporate excellence, it is also claimed that
success or failure of reforms hinges on management’s sagacity and ability to
change the firm’s driving culture in time and in time with required changes in
strategies. 9
The potential value of organizational culture has not been realized fully in the study of
strategic management. Ignoring the effect that culture can have on relationships among the
functional areas of business can result in barriers to communication, lack of coordination,
and an inability to adapt to changing conditions. Some tension between culture and a
firm’s strategy is inevitable, but the tension should be monitored so that it does not reach a
point at which relationships are severed and the culture becomes antagonistic. The result-
ing disarray among members of the organization would disrupt strategy formulation,
implementation, and evaluation. In contrast, a supportive organizational culture can make
managing much easier.
Internal strengths and weaknesses associated with a firm’s culture sometimes are
overlooked because of the interfunctional nature of this phenomenon. It is important,
therefore, for strategists to understand their firm as a sociocultural system. Success is often
determined by linkages between a firm’s culture and strategies. The challenge of strategic
management today is to bring about the changes in organizational culture and individual
mind-sets that are needed to support the formulation, implementation, and evaluation of
strategies.

Management

The functions of management consist of five basic activities: planning, organizing, motivat-
ing, staffing, and controlling. An overview of these activities is provided in Table 4-3.

TABLE 4-3 The Basic Functions of Management
Stage of Strategic-Management
Function Description Process When Most Important

Planning Planning consists of all those managerial activities related to preparing Strategy Formulation
for the future. Specific tasks include forecasting, establishing objectives,
devising strategies, developing policies, and setting goals.
Organizing Organizing includes all those managerial activities that result in a structure Strategy Implementation
of task and authority relationships. Specific areas include organizational
design, job specialization, job descriptions, job specifications, span of
control, unity of command, coordination, job design, and job analysis.
Motivating Motivating involves efforts directed toward shaping human behavior. Strategy Implementation
Specific topics include leadership, communication, work groups, behavior
modification, delegation of authority, job enrichment, job satisfaction, needs
fulfillment, organizational change, employee morale, and managerial morale.
Staffing Staffing activities are centered on personnel or human resource management. Strategy Implementation
Included are wage and salary administration, employee benefits, interviewing,
hiring, firing, training, management development, employee safety,
affirmative action, equal employment opportunity, union relations, career
development, personnel research, discipline policies, grievance procedures,
and public relations.
Controlling Controlling refers to all those managerial activities directed toward ensuring Strategy Evaluation
that actual results are consistent with planned results. Key areas of concern
include quality control, financial control, sales control, inventory control,
expense control, analysis of variances, rewards, and sanctions.