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LESS HARD-CORE CULTURE
HARDCORE CULTURE
- Most important activity as stated by Gates
- Recruiting responsibility of everyone in organization
- Target type-A people (top 5%)
- N minus 1 philosophy
- By 1986; 1,200 employees into new offices, 29 acre property
- Social Interaction: Numerous cafeterias, "Anything with caffeine is free"
- Atmosphere: Familiarity giving social belonging (e.g. 9'x12' offices with personal decoration)
- Morale & Mental Health to fight long working hours
- Frugality remained UNCHANGED
- Gate's Personal Effort of maintaing and managing
- "Culture where everyone felt that their excellence was material to the bottom line"
- Hiring the brightest: Smart & Ambitious
- Steve Ballmer's primary responsibility = Recruiting co-ordinator
- "Once-in-a-lifetime" > Prior experience
- Intense interview process
- The philosophy of "n minus 1" for efficienct allocation of position
- Employee ownership raised motivation and retention
- Microsoft went public (1986)
- Semi-annual Individual Performance Review and Reward (pay rise)
- SMART - Specific, Measurable, Attainable, Result-based and Time-bound
- Learning from mistakes - "Disease Model of Management"
- Paul Maritz introduced a forced evaluation curve (1 to 5 performance scale)
- Every August, performance review forums filled out + eligibility of stock options
- "Hard-core" environment, Challenging & Engaging work assignments
- Dramatic responsibility overnight
- The "Ladder Levels" (1983 & 1984)
- Horizontal Transfers - encouraging to switch jobs every 2 - 2.5 years
- Personal Mentoring - embedded in Microsoft's values
- The infamous "Bill-Meeting": Knowledge & Commitment
- At first, 35 people managing 100 campuses
- With time: 300 experts screening whole population of computer science graduates
- Strike teams
- International search
Ballmer’s priority 1:
- create a greater sense of clarity and excitement about the company’s direction
Vision Version 2:
- “To empower people to do anything they want, any place they want, and on any device.”
Ballmer‘s Priority 2: - Provide more freedom to act without bureaucracy
- turn over the keys
- replace hands-on-control to coaching
OHI survey in 1998:
- 29 first-level VPs were ranked from highest to lowest.
- VPs had to explain the results during annual business review meetings
- Would softening of Microsoft’s hardcore culture compromise the heart of its competitive advantage?
- Could people who were hired for drive and passion be able to rebalance their lives?
Review
- The need for structured review and feedback process tied in with rewards system
- 29 competencies were developed, each described behaviorally at 4 different levels of performance
- Brought clarity and consistency to various people processes
- At least 10 000 employees hold stock options over $1 Mil
- Top 22 execs held 31% of stock (= $138 Bn)
- base pay increased from 50th to 65th percentile
- Non-executive ladder levels increased from 12 to 22 to allow more frequent promotions
General change in the '90s
Adopted to larger company
BUT
desire to keep old culture
What types of groups are there?
Schein's Org. Culture Model
Why do we need Organisational Culture?
1. ORGANISATIONAL PERSPECTIVE
- Distinguishes the organization from other organisations
- Can direct employees and managers towards same mission and value
- Less turn over rate
- Higher Profitability
- Key to solve environment adaptation & variation adaptation
2. EMPLOYEE’S PERSPECTIVE
- Employees will be strongly committed and motivated
- Higher Job satisfactions
- Big drop in stock price
- The night attack by Sun
Key factors: Transparency, Accountability and Collaboration
… to build support for cultural change
‘Hey this is what Bob and his team are trying to do.’
2 Lessons learnt:
- Helps managers to analyse systematically the nature of each situation
- Leaders can be allocated to groups most receptive to their style of command
- Substantial training and expertise are needed to implement the contingency approach effectively
Managers should be flexible but consistent culturally. Organisational culture is the latent element, which can make managers belonging organizations to be highly motivated
- Must be careful when adjusting
… to create a framework for the radically new culture
Assumptions
Organisational Values
Surface manifestations
of culture
1) Undestanding opportunity in
2) Taking advantages of growing scale
3) Some functions to be centralised
4) Emphasis for employee training
into knowledeable advisors
1. Do the right thing with the right person
Stock Option
…to integrate the new culture into the organization
- Monday morning meeting with top management
- Video cast to all employees
- Strategic Operating Resource Planning
New High Position
1. Introduction: What is Corporate Culture?
…to emphasize new cultural priorities
- 150 different documents were reduced to 3 one-page templates
- Quarterly reviews
2. Home Depot: Its' Culture Change
Leave
3. Microsoft in the 80s & 90s
4. Microsoft in the 2000s
2. Keep your people motivated
5. Conclusion
Microsoft: Organisational Culture