C2 Internal environment
• Corporate culture.
• Corporate social responsibility (CSR), ethics.
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What does the word culture mean?
How can a business have a culture?
Why is the culture of a business important?
How might a business improve it's culture?
The internal business environment refers to everything that happens within a company. It's like the company's own ecosystem. Imagine your favorite UK business as a mini-world where all the action takes place. These factors influence the culture within an organisation.
1. People:
In this mini-world, the people are like the citizens. You've got the big bosses (CEOs and managers) making important decisions. Then there are the employees who do the daily tasks, like making coffee or creating cool products.
Example: In a UK business like Tesco, the big bosses decide what products to sell, while the employees stock the shelves and help customers.
2. Culture:
Just like countries have their own cultures, businesses have their own vibes. It's the way people do things, like how they dress, talk, and work together.
Example: If you walk into a funky, creative office like Google's in London, you'll see a culture of innovation and casual collaboration.
3. Structure:
This is the organization's blueprint. Who reports to whom, who's in charge, and how information flows through the company.
Example: In a place like the BBC, there's a clear structure – editors, reporters, and producers all have their roles, and the hierarchy helps the news get from the field to your TV.
4. Processes:
These are like the company's routines. How things get done, step by step. From producing a new gadget to handling customer complaints.
Example: Jaguar Land Rover has specific processes for designing and building cars. Each step is crucial to make sure the cars are safe and awesome.
5. Resources:
Imagine a business like a house. Resources are the tools, materials, and money used to build and maintain that house.
Example: For a clothing store like Topshop, resources include fabrics, sewing machines, and cash to pay for staff and rent.
6. Technology:
This is the cool stuff a business uses to make life easier. Computers, software, machines – all the techy things.
Example: In a tech-savvy business like ARM in Cambridge, they use cutting-edge technology to design computer chips that end up in devices worldwide.
So, the internal business environment is like the DNA of a company. It's what makes each UK business unique and influences how it operates and grows.
Business (corporate) culture is a hot topic. You might have heard people talk about a blame culture-how an organisation is structured can have a great impact on whether or not there is a blame culture and, more importantly, whether employees and managers share the same view of this.
Corporate cultures vary hugely from business to business. For example, large banks in the city are known for their long hours and cut throat attitudes whereas technology start-ups, such as those found in Silicon Valley and Old Street, are known for their relaxed, casual atmosphere.
What impact might the culture have on a business?
Corporate culture is like the personality of a company. It's the shared values, beliefs, behaviors, and attitudes that define how people in a company work together. So it is often tied in with the mission, aims and values.
Imagine a company as a big family. The way people treat each other, the way they dress, and how they communicate help create the company's culture.
Examples of Corporate Culture:
Innovative Culture: Imagine a tech company where employees are encouraged to come up with new ideas and experiment. This company's culture values creativity and problem-solving.
Collaborative Culture: In a company that values teamwork, employees help each other succeed. It's like teammates in a sports team working together for a win.
Customer-Centric Culture: In a retail company, if employees always put customers first and go the extra mile to make them happy, that's a customer-centric culture.
Corporate Social Responsibility can greatly influence the operations of a business. For example, in the nuclear industry many people jump to conclusions about the dangers of enriching uranium: they really conjure up stories which frighten others or embellish stories from historic events such as Chernobyl in 1986. These examples are usually driven by fear of the unknown and incorrect assumptions, but they can impact greatly on the success of a business. A more recent example in the nuclear industry was the Tsunami disaster at Fukushiuma in March 2011. This led to reductions in demand and lack of confidence in investing in planned nuclear power stations.
Corporate Social Responsibility (CSR) is like a company's promise to do good things for society, not just for profit. It's about being ethical and contributing positively to the community and environment.
Ethical behavior means doing what's right and fair, even when no one is watching. Businesses with strong ethics treat people and the planet well. Businesses are also shaped by ethical considerations. One such example is the range of services offered by the NHS. in 1978, the birth of Louise Brown, the world's first ever test tube baby, led to some disapproval and claims that such intervention was unethical.
The health service is probably the most obvious example of the importance of ethics- IVF being almost commonplace and R&D appearing to make rapid progress, committees and government are challenged constantl;y about the ethics, for example, of body transplants. Very recently the announcement of human hand transplants and proposal for 3D printing of body parts are undergoing an ethical debate.
Such matters impact on the way businesses are organised and operate, and on their funding and company values. For example, new businesses have emerged to meet the demand and supply of automated prostheses, pacemakers and computer software to stimulate brain function.
Businesses need policies and procedures in place to ensure their employees behave ethically. One example of where government stepped in to stop unethical practice was the decision to cap exorbitant interest rates charged by unscrupulous payday lenders.
CSR is an ethical consideration and many organisations have policies such as whistle-blowing and equality to ensure they operate ethically.
Examples of CSR and Ethics:
Environmental Responsibility: A company that reduces its carbon footprint and supports eco-friendly practices is showing environmental CSR. They might use sustainable materials and energy-efficient processes.
Ethical Sourcing: A clothing company that ensures its products are made in factories where workers are treated fairly and paid well is practicing ethical sourcing.
Community Engagement: If a tech company donates laptops to schools in need, they're engaging in CSR by giving back to the community.
Transparency: A business that openly shares information about its practices, good or bad, is showing ethical behavior. For instance, a food company that admits a mistake and recalls a product with a quality issue is being transparent.
Remember, a positive corporate culture and a commitment to CSR and ethics help businesses build trust, maintain a good reputation, and contribute to a better world.
The Fujitsu Royal Mail Scandal is a great example of CSR. The Fujitsu Royal Mail Scandal is a great example of this, read the following article...
https://www.bbc.co.uk/news/uk-northern-ireland-68363440
Mix Pair Share
What does the word culture mean?
How can a business have a culture?
Why is the culture of a business important?
How might a business improve it's culture?