CASE – FALCON COMPUTER Brief Introduction

The case regarding the Company ‘Falcon Computer’ deals with organizationspecific culture and values. As per the case, Falcon Computer was a new firm in the Silicon Valley area of California (U.S.A), having been created just 8 months earlier. Since the organization was in a start up phase, the managers of the firm decided to create and instill the type of culture they thought would be most appropriate for their organization. And it was for fulfilling this objective that the ‘Falcon Values’ document was created which described the culture of the Company as the management saw it. The organizational culture statement covered such topics as treatment of customers, relations among work colleagues, preferred style of social communication, the decision-making process and the nature of the working environment. After being hired as a software trainer, Peter Richards read over the ‘Falcon Values’ statement only to be struck by the wide discrepancy between the values expressed in the document and the actual employee behaviour in the organization. For example, the Falcon Values document contained statements such as this: “Quality: Attention to detail is our trademark; our goal is to do it right the first time. We intend to deliver defect-free products and services to our customers on the date promised.” However, Richards had already seen shipping reports showing that a number of defective computers were being shipped to customers. Also, his personal experience supported his worst fears. When he borrowed four brand-new Falcon computers from the shipping room for use in a training class, he found that only two of them started up correctly without additional technical work on his part. Another example of the difference between the Falcon Values document and actual practice concerned communication within the organization. Even though the executives talked about facilitating open communications whenever they met to discuss the Falcon Values document; Richards, however, hadn’t seen much evidence of such communication. He believed that the real organizational culture that was developing at Falcon was characterized by secrecy and communication that followed the formal chain of command. Having witnessed the reality, Richards soon became disillusioned and also confided in a co-worker that “the Falcon Values document was so at variance with what people saw everyday that

very few of them took it seriously.” Employees quickly learned that hierarchy, secrecy and expediency was truly emphasized in the organization ignoring many of the concepts incorporated in the values document. Despite his frustration, Richards stayed with Falcon until it filed for bankruptcy two years later. The case finally closes with Richards cleaning out his desk and thinking to himself that next time he’ll pay more attention to what is actually going on and less to what top management says is true. Furthermore, he thought to himself that values just cannot be created.

QUESTIONS FOR DISCUSSION – Qs.1) – What is more important, the statements in a corporate culture document or actual managerial behaviour? Ans.1) – Here it is not easy to say which is more important either the statement in corporate culture document or actual managerial behavior. Because organizational culture increases the behavioral consistency of the employees and the behavior of the employees in an organization represent the picture of the organizational culture. In today’s workplace, the role of culture in influencing employees’ behaviour appears to be increasingly important. And at the same time, employees’ actual behavior is also important which in turn depicts that organization is having a good culture and proper implementation process of the culture is being followed. So here incorporation of the culture in employees’ behavior is more important. Because once the corporate culture document is ready the behavior of employees depends upon whether it is properly implemented or not. Since “Falcon Computer” was a new firm so creation of the document called “Falcon Values” which described the culture of the company was fine but they hadn’t decided as to how the statement in the ‘Falcon Values’ document would be implemented in actual practice. And thus there emerged differences in the statement in the ‘Falcon Values’ document and the actual practices of the managers and the employees. There should be proper communication and implementation (ex – Telling Stories - Ford motor, Nike etc. Rituals – Wal-Mart, IBM, Ericsson, PriceWaterhouse-Coopers etc. and many more...) of the organizational culture so that the statement mentioned in the corporate culture document is congruent with the actual behaviour of the employees.

Qs.2) Why did the Falcon executives act as they did? Ans.2) The Falcon executives acted as they did because they wanted to maintain their supremacy in the organization by virtue of the positions held but at the same time also wanted to create and maintain such an organizational culture that every employee in the organization could identify with. Through the “Falcon Values” document, the executives did want to develop their own organization – specific culture but they also wanted to make sure that their positions in the organization hierarchy were maintained. While the executives wanted to create and thereby project a common culture in the organization, the reality was that hierarchy, secrecy and expediency was truly emphasized in the organization ignoring many of the concepts incorporated in the values document.

Qs.3) Why didn’t employees like Richards blow the whistle on Falcon, challenging the inconsistency between values and behavior? Ans.3) The Employees did not like Richards Whistle Blow because they were themselves very much part and parcel of Falcon’s Organizational culture. -When the culture was planned and implemented in the organization, probably top management didn’t include all the employees but when they implemented it, it affected each and every employee of the organization. All the employees became a part of it and became habituated in that culture, they adopted the culture and even made some internal changes (in their value system). So blowing the whistle and changing the culture was like pulling them out of their comfort zone. -Blowing whistle is the previous stage of change. As we know changes are always prevented in an Organization (sometimes because of financial loss, sometimes because of fear of unknown, some times because of selective information processing etc). Also, the employees didn’t like the whistle blow as a predecessor of Organizational Change. -And here as the employees were also practicing the wrong culture, they didn’t want the whistle to blow.

Qs.4) How can executives go about changing the old values that govern an organization? Ans.4) It is very hard to change the old values or culture. So, first of all, it should be observed that whether the value is good or not. The question ‘Is the value causing any problem to the goodwill of the organization?’ should be asked. If so, then first of all, the higher authorities should be made to understand that with time, some old values might become obsolete which in turn necessitates the changing of the values for the betterment of the organization. Then the needed amendment should be made in the culture, as the culture is imbibed by the employees of the 8organization. So, first of all, the higher executives should bring in the change and then they should also ask the employees to do the same & thereby help them to change their organizational culture. In this way the executives can go about changing the old values that govern an organization.

A case Study on Falcon Computer


Group No.6
Group Members:
1. Arindam Dey 2. Abhijeet Sarkar 3. Kathakali Majumder 4. Pavan Kumar Singh 5. Payal Sinha 6. Jayeeta Sen

Submitted to : Dr. Kavita Shastri

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