ORGANIZATIONAL CULTURE WEEKLY ASSIGNMENT:

Assumptions about External Adaptation Issues and Managing Internal Integration

In the Fashion Industry

Prepared by Group 8:
Rafania Kinasih Rus Effendi 1806230314
Reisa Audrey Khalisha 1806230390
Qoirunisa Ayna Fadillah 1806174282

FACULTY OF ECONOMICS AND BUSINESS

UNIVERSITY OF INDONESIA

2020
 STATEMENT OF AUTHORSHIP

We the undersigned declare to the best of our ability that the paper/assignment here with
authentic writing carried out by ourselves. No other authors or works of other authors have been
used without any reference to its sources. This paper/assignment has never been presented or
used as paper/assignment for other courses except if we clearly stated otherwise. We fully
understand that this assignment can be reproduced and/or communicated for the purpose of
detecting plagiarism.

Student ID Number Student Name Signature

1806230314 Rafania Kinasih Rus Effendi

1806230390 Reisa Audrey Khalisha

1806174282 Qoirunisa Ayna Fadillah

Course : Organizational Culture

Paper / Assignment : Assumptions about External Adaptation Issues and Managing
Internal Integration In Education Industry
Lecturer : Dr. Ir. Rosiwarna Anwar, M.A.
Title Date : 25th September, 2020
 TABLE OF CONTENTS

STATEMENT OF AUTHORSHIP 2
TABLE OF CONTENTS 3
CHAPTER 5 - EXTERNAL ADAPTATION ISSUES 4
5.1 Shared Assumptions About Mission, Strategy, and Goals 4
5.2 Shared Assumptions About Goals Derived from the Mission 5
5.3 Shared Assumptions About Means To Achieve Goals: Structure, Systems, and
Processes 5
5.4 Shared Assumptions About Measuring Results and Correction Mechanisms 6
5.5 Shared Assumptions About Remedial and Repair Strategies 6
CHAPTER 6 - MANAGING INTERNAL INTEGRATION 7
6.1 Creating a Common Language and Conceptual Categories 7
6.2 Defining Group Boundaries and Identity 8
6.3 Distributing Power, Authority, and Status 8
6.4 Developing Rules for Relationships 9
6.5 Allocating Rewards and Punishment 9
6.6 Managing the Unmanageable and Explaining the Unexplainable 9
CASE STUDY: 10
Chapter 5 - External Adaptation Issues

Organizational culture can be defined from a structural point of view. But the core meaning of
the content of the culture itself cannot merely be explained, yet it can be explained by the
assumptions of the culture itself.

From social psychology and group dynamics, the most useful model for defining the content
dimensions of organizational cultures is derived. Two archetypal challenges are faced by all
individuals and organizations:

● survival in and adaptation to the external environment, and

● integration of the internal processes to ensure the capacity to continue to survive and
adapt.

The process of culture formation results in the pattern of mutual assumptions or the ‘culture’ of
the group itself. With shared beliefs, values, common learning, and other mutual interest, at
times it also faces problems when adapting to the external environment in order for them to
survive. The problem that may arise described as follows:

● Mission & Strategy - Acquire a shared understanding of core mission, the primary task
● Goals - Develop consensus on goals
● Means - Develop consensus on the means to be used to achieve the goals (Ex:
organizational structure, reward system)
● Measurement - Develop consensus on criteria to measure the group performance on
achieving the goal (Ex: Control System)
● Correction - Develop consensus on repair strategies if the goal is not met.

5.1 Shared Assumptions About Mission, Strategy, and Goals

An organization must develop a shared concept of its ultimate survival problem, from which
usually is derived its most basic sense of core mission. This shared concept revolves around the
question of economic survival and development, which includes maintaining good ties with the
organization's major stakeholders. Includes:

● The investors and stockholders

 ● The suppliers of the materials needed to produce

● The managers and employees

● The community and government

● The customers willing to pay for the product or service

Depending on the form of industry (religious, educational, social, or governmental organization),

the main missions or primary objectives-vary, but the logic that the mission ultimately derives
from a balancing of the needs of different stakeholders is the same. Moreover, in terms of a
single constituency, such as consumers, core mission or primary tasks are typically specified.
This results in a complex multinational issue being the core goal, and some of the roles must
remain latent in order to maintain the organization's manifest identity. In addition, overall
dimensions of corporate culture grow around these topics, and in the subunits whose interests are
involved in the latent functions, subculture dimensions emerge.

5.2 Shared Assumptions About Goals Derived from the Mission

The shared assumption within the group does not automatically guarantee that the key members
of the organization will have common goals or that the various subcultures will be appropriately
aligned to fulfill the mission. The role is always understood but not well communicated. The
group needs a common language and shared assumptions about the fundamental logistical
operations in order to reach agreement on goals, through which it can switch from anything as
abstract or generic as a sense of purpose to the practical goals of designing, manufacturing, and
delivering an actual product or service within defined and agreed upon cost and time constraints.

Since organizational priorities have to be more specific, in order to establish annual or

longer-lasting targets, organizations usually sort out their mission and identity problems. We
need to be cautious not to confuse these short-run assumptions about targets with project
assumptions in order to fully grasp cultural assumptions.
5.3 Shared Assumptions About Means To Achieve Goals: Structure, Systems, and
Processes

Each organization has its own culture about the ways to accomplish goals and how to make it
sure of it to happen, it is developed based on the shared basic assumptions within. It is enforced
by the leaders of the organization and becomes structures, systems, and processes, which, if
successful, become shared parts of the culture. Then the procedures taken for granted, they
become the aspects of culture that will be hardest to change.

In an organization, it is crucial to have a clear company structure. The structure could be defined
as the organizational structure of the company. By having a good and clear structure, the chain of
command will be clear and it will help the information flow smoothly around the company with
minimum numbers of errors. Whereas, the system is defined as the procedure and principles
applied inside the company. Employees are explained to how things should be done and it gives
them the purpose behind the job. Lastly, Process means as every action that the company took in
order to reach the end goal of the company.

5.4 Shared Assumptions About Measuring Results and Correction Mechanisms

The organization needs to evaluate how they are doing against their assigned goals and need to
periodically review them to determine whether they are performing in accordance with their
mandate. This will include three areas about what they need to find consensus, contributing to
cultural elements that later became fundamental assumptions. Consensus on what to measure,
how to measure, and what to do when corrections are needed must be reached. These concerns
also become important to the organization's new workers because those metrics are related to
how he or she is doing the job.

Firstly, when a group is working, to know what kind of remedial action to take when things do
not go as planned, it must have a consensus on how to judge its own performance. Then
consensus must be achieved both on the criteria and on the means by which information is to be
gathered. Information collected can be through telephone communications, frequent visits,
formal and informal surveys, or meetings at the office. Information acts as evidence to be
measured as an evaluation of the workers. Through evaluation, it will help the worker to find out
the weakness of the implemented idea that will help them plan for a new solution.
5.5 Shared Assumptions About Remedial and Repair Strategies

Lastly, another important thing to take into account the consensus is what to do if there is a need
for a change in direction and how to make the change happen. For example, if it is obvious that
the community is not on track, the benefit is not as planned, if information gets to the right
location, where it is understood and acted upon, there is always the issue of finding agreement on
what type of action to take.

Effective remedial action requires consensus on how to gather external information, how to get
that information to the right parts of the organization that can act on it, and how to alter the
internal production processes to take the new information into account. After remedial or
corrective action has been taken, new information must be gathered to determine whether results
have improved or not.

Chapter 6 - Managing Internal Integration

A group can not perform tasks, survive, and grow unless its internal relationships are managed.
At the same time as the group executes its activities, learning how to handle certain internal
relationships takes place. Having said that, for leaders, staff members, and outside advisors the
analytic differentiation is very important so the energy and time of the group will focus mainly
on the groups and interpersonal aspects of both tasks.
6.1 Creating a Common Language and Conceptual Categories

It is clearly important for any form of consensus to be established and any communication to
occur, that common language and common concept categories are created. This common
understanding starts with the behavior, gesture, and expression categories that are often provided
by the individual who brought the group together or by the more involved members of the group
after they have been together. As typically all members of the same host community, have a
shared language. As the group matures, however, it puts in common words with unique
significance, and the meaning of those words gradually becomes the deepest layer of the culture
of that group.

6.2 Defining Group Boundaries and Identity

For a group to work and evolve, the perception of who is and who is not in the new group, and
the criteria by which those decisions are made is one of the most critical areas for strong
consensus. New members can not really do their primary task if they're uncertain about
membership. If the group doesn't have a way to describe itself and its boundaries, they can't
really maintain a clear sense of their own.

According to Schein, organizations can be thought of as involving three dimensions of career

movement:

(1) Lateral movement from one task or function to another,

(2) Vertical movement from one rank to another
(3) Inclusionary movement from outsider to insider.

Defining the criteria for deciding who is in and who is out of an organization or any of its
subunits is one of the best ways to begin to analyze culture. Moreover, the very process by which
a group makes those judgments and acts on them is a process of culture formation and
maintenance that forces some integration of the external survival issues and the internal
integration issues.

6.3 Distributing Power, Authority, and Status

According to Goffman, a critical issue in any new group is how influence, power, and authority
will be allocated and what the rules will be for “deference and demeanor”. How power,
authority, and status will be distributed is the most common problem in the group. It is extremely
uncertain and volatile to figure out who can and who can control it. However, most organizations
or associations typically arise from founders and leaders who know how things work and
therefore impose rules on how the entity will function. Get and how to handle violent behavior.
In order to allocate control, authority, and strength, each community, organization, occupation,
and macroculture establish standards. If those norms provide a structure that performs external
tasks and leaves members fairly free of concern for the community, these norms become
unanswered assumptions and generic critical elements of cultural DNA in a progressive manner.

6.4 Developing Rules for Relationships

Establishing a workable peer relationship at dealing with issues related to it needs to be

established by all new groups. While problems with authority are usually derived from the need
to deal with feelings of aggression, the peer relationships and intimacy problems are derived
from the need to deal with feelings of affection, love, lust, and sexuality. Therefore, all Societies
have established specific sex roles, kinship structures, and friendship/ sexual activity laws that
help to sustain an existing relationship while ensuring the procreation process.

6.5 Allocating Rewards and Punishment

Every industry seeks employees who have a good self-image and full self-motivation so they can
help make the industry grow. This could be achieved by the help of creating a system of
discipline with the rules and norms. There are two common ways industries used to improve
employee performance. Such as, providing rewards when there are certain achievements and
punishments (penalties or sanctions) if employees are deliberately negligent when working. This
System is the easiest and quickest way to change employee behavior and several elements of the
culture.

However, identifying whether an employee has been given a reward or a punishment can be a
tricky task because it is often ambiguous. Different people have different views of what reward
and punishment is. Some may think that being yelled at is a sign of reward, but others may see
that as a sign of punishment.

Reward and punishment is a concept adopted by industries to motivate employees to keep doing
their best at work. The method of reward and punishment, which has been long used in the field
of work, has also developed into the world of fashion.

6.6 Managing the Unmanageable and Explaining the Unexplainable

It is undeniable that every group faces some issues that are out of their control, incidents that are
inherently unpredictable and therefore terrifying. At the physical level, social phenomena such as
natural disasters and the weather are something out of our control, you might not know why
when it is going to happen. Whereas on a biological level, events such as birth, growth, puberty,
illness, and death involved the fear of what is going on and the reason why.

Those events that we can control nor understand, need an alternative basis for thinking about
what has happened in a meaningful context to make it seem understandable. Sometimes,
religious beliefs are able to provide such context and may offer justification for those events that
seem unfair and meaningless. In ambiguous, uncertain, and threatening situations, this
superstition explains the unexplainable. I give steps and guidelines to do so.
Both superstitions and myths tend to form around critical events in the organization's history,
mainly the ones that are difficult to explain or justify due to lack of organizational control.
Organizations have the power to develop their own ideology or something equivalent to religion.
This ideology is created for the basis of the Manor in which past critical events were managed.
Myths and stories are developed around the founding of the company, Times of transformation
and change, or surviving an unusual growth spurt.
 CASE STUDY

The General environment in Zara can be categorized into 4 Hofstede’s cultural dimensions. The
first one is power distance. Individuals holding the most powerful positions in Zara are the ones
admitted to having privileges for their position. In the organization, the superior still needs
information from his/ her subordinates while subordinates expect their boss to control them. In
the dimension of uncertainty avoidance, Zara believes that it's important to have rigid codes for
everything. Especially in Spain, people working in Zara seek stability in their life and work and
constantly avoid confrontation. The third culture dimension, individualism, and collectivism,
determining whether Zara is more collectivist or individualist depend on which country it is
located in. Compared with the rest of European countries (except Portugal) Spain is going to be
more collectivist. However, compared to the rest of the world, Spain tends to be more
individualist. In Zara, teamwork among workers is natural, and no need for strong motivation
from the superior in order for workers to comment on this act. The last cultural dimension is
masculinity/ femininity. Laura tends to be more feminine and shows more tenderness. They also
avoid a direct and confrontation style, which leads to conflicts being solved by compromise and
negotiation. Managers are not expected to be so aggressive or competitive but tend to pay
attention to the human aspect.

In a global aspect, Zara's objectives and actions are saving energy, making their stores
echo-friendly, producing less waste, recycling, and creating a team that is environmentally
aware. Zara uses ecological fabrics and organic cotton for their products and uses biodiesel fuel
for transportation. On the other hand, Zara’s strategic plan is to hold a big market share among
young fashion-conscious city dwellers in all continents by quickly responding to their demands.
The business objective is to be the number one supplier of affordable fashion in the world and
continue its expansion globally by adding another 520 new stores and increased the market share
of Zara by 5% and sales by 10%.
In terms of staffing, motivating, and compensation, Zara continues to build relationships with
their employees. Zara's Moto is “it's what you contribute that keeps us moving”. They sell their
strong brand image to attract their future employees and make employees feel needed for their
contribution. Globally, Store managers in Zara have a salary which 70% is based on their
commission. Employees also receive individual bonuses by achieving success with the whole
team. Zara also gives training programs and avenues for care development, Health insurance and
retirement plan, a 15% discount for employees, annual trip/ gathering, tuition reimbursement,
and business travel. Here in Indonesia, employees receive more benefits such as a phone, car,
and private driver for higher-level employees, and an apartment for expatriate managers.