ORGANIZATION CULTURE

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Organization culture is a system of shared values about what is important and beliefs about how the world works. As such, it is an important part of how an MNE is organized.

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1. Culture and Values. Key features of organizational culture include values and principles of management, work climate and atmosphere, patterns of “how we do things around here,” traditions, and ethical standards. The shared values that make up organization culture influence what employees perceive, how they interpret, and what they do to respond to their world.

2. Culture’s Increasing Importance. Studies have shown that there is a significant link between organization culture and financial performance. A firm culture often shapes the strategic moves an MNE will consider or reject, and it can dramatically influence the success of corporate initiatives. It is therefore crucial for the corporate headquarters to develop a strong culture that is shared by most organizational members

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