Question 1 (20 marks) Read the short case below and answer the questions that follow. Propelled by a culture of cost efficiency and competitiveness, Dell, Inc., was the unstoppable leader in the computer industry for more than a decade. Experts praised its low-cost, responsive manufacturing and direct-marketing sales model. Founder Michael Dell championed short-term objectives, while Kevin Rollins (until recently Dell CEO) was the architect of efficiency oriented processes and measures. Dell culture emphasised “winning,” meaning that it focused on beating the competition and staying on top through low prices. “There are some organizations where people think they’re a hero if they invent a new thing,” Rollins said a few years ago. “Being a hero at Dell means saving money.” Although still an efficient manufacturer of low-cost computers, Dell’s spectacular success has stalled while HP and other competitors are moving ahead. The reason? Dell’s strong culture blinded leaders and most staff to anything other than building low-cost computers, yet the market was shifting toward a preference for style and innovation. “Dell’s culture is not inspirational or aspirational,” suggests one industry expert. “[Its] culture only wants to talk about execution.” A few staff warned that Dell’s culture needed to change, but those who dared to criticize the company’s deeply ingrained values and assumptions were quickly silenced. “A lot of red flags got waved—but only once,” recalls a former Dell manager. Meanwhile, Dell’s fortunes—including public ratings of its culture—were falling. A few years ago, Dell ranked number one on Fortune magazine’s list of most admired companies in America; two years later, it was off the top 20 list. Similarly, Dell Canada placed fifth on the list of Canada’s most admired corporate cultures in 2006. A year later, DEGREE Assignment July - December BOB721 Organisational Behaviour ©BOU 2022 Page 9 of 9 the company was not mentioned at all; its culture was no longer admired. These and other concerns motivated founder Michael Dell to return as CEO, replacing Kevin Rollins. Other senior executives have also left the company. “The company was too focused on the short term,’’ Dell admits. He apparently also repeatedly emphasizes to staff that Dell’s past culture “is not a religion.” Dell is convinced he can turn the company around, and there is some indication his new vision is working. Still, a few critics believe that changing Dell’s culture will be a mammoth task. “It’s not an easy transition,” warns a technology analyst. “You’ve got to change your mind-set and your culture.” (Source: McShane, S L., & Von Glinow, M. A., (2009). Organizational behavior : emerging knowledge and practice for the real world. 5th ed. Pg414) a) Define Organisational culture. (1 mark) b) Using the dimensions of organisational culture profile, evaluate Dell’s culture and suggest the culture that Dell needed to have adopted to be successful in its industry? (4 marks) c) Discuss three ways in which a strong culture is important to organisations. (6 marks) d) Studies have found only a modestly positive relationship between culture strength and organisational effectiveness because three contingencies need to be considered. Evaluate Dell’s culture on the basis of these contingencies.