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    Organizational Culture and Business Performance: Daniel Denison

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    123agattar
    The document discusses organizational culture and its relationship to business performance. It presents Daniel Denison's model of organizational culture, which identifies four key dimensions: external focus, internal focus, flexibility, and stability. It then provides examples of how different companies have scored on these dimensions. The document concludes that studies have found organizations with stronger, more positive cultures significantly outperform those with weaker cultures, with returns on equity averaging 21% for high-scoring cultures versus only 6% for low-scoring cultures. High-performing organizations are able to balance external adaptation with internal integration and link top-down goals with bottom-up commitment.

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    Organizational Culture and Business Performance: Daniel Denison

    Uploaded by

    123agattar
    128 views11 pages
    The document discusses organizational culture and its relationship to business performance. It presents Daniel Denison's model of organizational culture, which identifies four key dimensions: external focus, internal focus, flexibility, and stability. It then provides examples of how different companies have scored on these dimensions. The document concludes that studies have found organizations with stronger, more positive cultures significantly outperform those with weaker cultures, with returns on equity averaging 21% for high-scoring cultures versus only 6% for low-scoring cultures. High-performing organizations are able to balance external adaptation with internal integration and link top-down goals with bottom-up commitment.

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    Business Performance

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    The document discusses organizational culture and its relationship to business performance. It presents Daniel Denison's model of organizational culture, which identifies four key dimensions: external focus, internal focus, flexibility, and stability. It then provides examples of how different companies have scored on these dimensions. The document concludes that studies have found organizations with stronger, more positive cultures significantly outperform those with weaker cultures, with returns on equity averaging 21% for high-scoring cultures versus only 6% for low-scoring cultures. High-performing organizations are able to balance external adaptation with internal integration and link top-down goals with bottom-up commitment.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    128 views11 pages

    Organizational Culture and Business Performance: Daniel Denison

    Uploaded by

    123agattar
    The document discusses organizational culture and its relationship to business performance. It presents Daniel Denison's model of organizational culture, which identifies four key dimensions: external focus, internal focus, flexibility, and stability. It then provides examples of how different companies have scored on these dimensions. The document concludes that studies have found organizations with stronger, more positive cultures significantly outperform those with weaker cultures, with returns on equity averaging 21% for high-scoring cultures versus only 6% for low-scoring cultures. High-performing organizations are able to balance external adaptation with internal integration and link top-down goals with bottom-up commitment.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 11

    Organizational Culture and Business Performance

    Daniel Denison

    International Institute for Management Development

    Denison Consulting
    The Denison Organizational Culture Model

    Denison Consulting
    One Hundred Year Old Manufacturing Company

    •Still 1st in industry but


    declining
    •1st time in 20 years they
    failed to meet targets
    •Targeted by competitors
    •President focused on
    operations
    •“We’re a team going down
    together.”
    •Trying to hold on to past

    Denison Consulting
    Key Dimensions:

    External Focus
    Adaptability + Mission

    The organization’s focus


    is on adapting and changing
    in response to the external
    environment

    Denison Consulting
    Key Dimensions:

    Internal Focus
    Involvement + Consistency

    The organization’s focus is


    on the dynamics of the
    internal integration of
    systems, structures, and
    processes

    Denison Consulting
    Key Dimensions:

    Flexibility
    Adaptability + Involvement

    A flexible organization
    has the capability to
    change in response to
    the environment

    Denison Consulting
    Key Dimensions:

    Stability
    Mission + Consistency

    A stable orientation
    contributes to an
    organization’s capacity
    to remain focused and
    predictable over time

    Denison Consulting
    SS E
    RE AT
    !
    OG UL
    PR IM
    ST
    Paradox:
    Successful
    organizations learn
    how to cope with the
    dual problems of
    external adaptation
    (stimulate progress)
    and internal integration
    (preserve the core).

    It is not an either/or
    proposition - high
    performance
    organizations must be
    able to do both at the
    same time.

    CO E
    N=868

    E ERV

    !
    RE
    TH ES
    PR
    Denison Consulting
    TO
    P-
    DO
    W
    N

    Paradox:
    High performance
    organizations learn how to link
    the purpose, direction, and
    goals of the organization
    (top - down) to a shared sense
    of responsibility, ownership
    and commitment with all
    employees (bottom - up).

    Employees understand the


    relationship between their
    individual goals and the
    organization’s goals and are
    highly motivated to contribute.
    BO
    TT
    OM
    -U

    Denison Consulting
    P
    Organizational Culture and
    Business Performance:

    Let’s Look at the Facts

    Denison Consulting
    Return on Shareholder’s Equity

    • Study of 161 publicly traded companies from a broad range of industries


    • Contrasts the performance of the 10% of the organizations with the best culture scores
    with the 10% of the organization with the worst culture scores
    • Average ROE for the organizations with the lowest culture scores is 6%, Average ROE
    for organizations with high culture scores is 21%
    • Highly similiar results for return on total investment

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