Question 1 Example Answer

In looking at Nike, we can see that the unity of purpose allowed by the strong organizational culture the company enjoys has created both market advantage as well as a real problems. Organizational learning has been hindered due to the cult-like socialization process new employees undergo. The main form of learning in the organization is modeling, a process in which members observe and learn how to behave by imitating the actions of others. Although this type of learning is good for quick learning of even complex tasks, it quickly leads to conformity which impedes creativity and innovation. Because of the resulting strong closed culture of Nike, learning new behaviors and ways of thinking is difficult for employees and as a consequence, organizational learning is limited.

Nike's strong culture has other implications as well. Employees at Nike are caught in a trap when they learn from other members and not from the environment around them. This is reinforced by the great success of Nike in the past. Employees fall into a competency trap as a result of the firm's past success. This occurs as Nike becomes risk averse due to employee reluctance to experiment, innovate and be creative because the organizational culture encourages doing things the way they have been done in the past. It is precisely this hesitancy to experiment and adapt to the outside environment in which Nike must compete, that could cause the company problems in the rapidly changing world market for athletic footwear.

In attempting to change Nike's culture to make it more receptive to experimentation and innovation, I would suggest that the present employees be made aware of their learning trap and how it affects organizational success. A socialization training program to encourage teamwork, creativity and innovation should be started and participation rewarded. New learning requires a sensitivity to the environment, and new ideas. Research has shown that often just by telling people about the competency trap and their aversion to risk, actually can make them more open to new learning. In addition, perhaps new employees who come from diverse backgrounds could be hired as proactive change agents. The culture Nike should use the new ideas as a springboard to new success, and a way of staying in touch with the ever-changing environment.

Changing the entire learning culture of an organization is indeed a great challenge. The re-alignment of corporate culture can be a huge task, at Nike specifically because the employees are modeling each other and not the outside environment in which they must compete. Resistance to new learning, which is the problem we want to change, itself hinders addressing the problem. Also, culture is a deeply rooted system of values anchored in myths and stories, which will resist change. The firm became successful based upon the way it did things in the past, why should it change? However, the CEO and the managers can help institute change by changing the reward structure and raising the awareness of employees. Rewards for experimentation and risk-taking, rather than results, would help. Also, when top executives lead by example and show creativity and experimentation, the rest of the organization will model that behavior. In this way the managers could cash in on the strong modeling culture and use it to their advantage in creating changes within the organization. Once the employees understand the need to be responsive to the external environment, they will begin to institute changes in the culture that reflect changes in the environment that will hopefully in turn change the organizational learning process.

http://www-personal.umich.edu/~finholt/Psych360/misc/360mid1.html

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