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The Impact of Organizational Culture on Decision Making

Organizational culture is an established pattern that essentially predetermines the existing communication structure, kinds of individual actions, group perceptions, and individual/group actions. These aspects have a critical impact on the manner in which decisions are made at the organizational level. In most circumstances, when leaders of an organization are making critical decisions, they tend to ignore the fundamental role of the organization’s culture. Tierney (2008) observes that, “…administrators tend to recognize their organizational culture only when they have transgressed its bounds and severe conflicts or adverse relationships ensue” (p.25). In such cases, the decisions made end up not having the impact they were initially intended.

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Strategic decision making pre-empts both negative and positive elements that may result from conflicting elements in the organizational structure. In essence, most people do not take into consideration the importance of organizational structure when formulating solutions for problems and introducing new strategies. Tierney (2008) further notes that, “As a result, we frequently find ourselves dealing with organizational culture in an atmosphere of crisis management, instead of reasoned reflection and consensual change” (p.25). Hence, this implies that there is need to recognize the interrelationship between decisions being made and the organizational culture. The art of working within the prescribed framework of an organization’s culture, prompts administrators to learn mechanisms of changing one programmatic area such that it does not affect others areas (Tierney, 2008).

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The process of changing an organization’s strategy may have a negative or positive effect depending on how the new strategy mergers with the organizational culture. Consider a company manager deciding to change the delivery mechanism for products and services without taking into consideration the organization’s culture. In such a case, the output of employees may change due to an overarching impact on attitude change. Keyton (2005) observes that, “A positive work culture can stimulate potential in employees if the business strategy and culture embrace the same goals and values” (p.135). This shows how a change of strange of strategy may have potential impact on the desired output from workers in terms of business deliverables

The act of merging two organizations may lead to the occurrence of potential conflict on account of different organizational perspectives, approaches, and culture. For instance, one organization considering itself as being superior may limit sharing pertinent information. This is because there is a fear of exploitation and contamination, which are impediments of knowledge transfer in mergers taking place between professional firms (Alvesson, 2002). For instance, if company A refuses to share knowledge with Company B, then the potential of failure occurring cannot be underestimated. Alvesson (2002) observes, “The example thus illustrates not only problems with mergers and cross-national interaction, but also the cultural nature of decision-making” (p.6)

Decision making forms a critical role in the emancipation, formulation, delivery, and accomplishments of preset business targets. It is evident that the entire decision making process starting from preparation stage to implementation stage tends to reflect the existing cultural beliefs regarding the definition of what is natural, rational, and effective (Alvesson, 2002). Therefore, it is important to note that decision making plays a central role in the actualization of business goals and objectives of an organization.

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Biases in decision making occur in various circumstances that are sometimes difficult to identify. First, in common practice people tend to settle for the first alternative when looking for lasting solutions to business problems. Secondly, it is common practice to find individuals belonging to an organization adopting a group formula, which at times overlooks feasible individual suggestions. Third, managers tend to repeat previous solutions that worked without taking due consideration of the potential contextual differences. Lastly, there is a tendency for most managers to selectively eliminate feasible approaches on account of personal experience. These forms of biases have for a long time affected the performance seen in most organizations.

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