ORGANIZATIONAL VALUES AND THEIR IMPACT ON

STRATEGY

BY : SURBHI BHANDARI

• Values- Values are our fundamental beliefs. They are the principles we use to define that which is right, good and just. Values provide guidance as we determine the right versus the wrong, the good versus the bad. They are our standards.

• Organizational Values- Organizational values define the acceptable standards which govern the behaviour of individuals within the organization.

• Organizational Values are a set of beliefs that specify universal expectations and preferred modes of behaviour in a company. They point the way to purposeful action and approved behaviour.

There are three categories from which an organizations values base is created :

• Physical Values- Maximum utilization of resources, orderliness, cleanliness, reliability, quality, safety etc.

• Organizational Values- communication, cooperation, standardization, coordination.

• Psychological Values- Creativity, innovation, loyalty, integrity, customer’s delight, respect for individual, service to society etc.

IMPACT OF VALUES• The values are integrated into the company's way of

doing business (policies, procedures, compensation practices, performance appraisals, etc.). They affect all aspects of the company from what products get made or sold to how people are treated.

• They stand for something--that is, they have a clear and explicit philosophy about how they intend to conduct their business.

• Organization's values are always in line with its purpose or mission, and the vision that the organization is trying to achieve.

• Values form the foundation for everything that happens in your workplace. Founder’s values premate the workplace. Founder will hire people who share the same values.

• Values largely govern the actions of the workforce.

• Values hold a major role in daily decision making, norms and relationship guidelines and how people interact with each other and customers and suppliers.

IMPORTANCE OF ORGANIZATIONAL VALUES

1. Formation of mission and vision statement2. Formation of organizational objectives3. Formation of policies and procedures 4. Fulfilling customers needs5. Competitive advantage

IMPACT ON STRATEGY

CASE STUDY – NIKE, INC.NIKE, INC was incorporated in 1964 as Blue Ribbon

Sports by BILL BOWERMAN and PHILL KNIGHTS and officially became NIKE,INC in may 1971.

Mission statement-

BRING INSPIRATION AND INNOVATION TO EVERYATHLETE* IN THE WORLD* IF YOU HAVE A BODY, YOU ARE AN ATHLETE.

• Values- Innovation, creativity, maintaining brand value, simplicity, fashionable, consumers decides, dynamic, responsible(doing the right thing) , transparency, promoting young and talented people.

MATCHING THE VALUES :• In 1972, Nike footwear introduced “moon shoe”

that features a waffle sole in US Olympics.• Nike has always sponsored young, talented and

aggressive sports person. Nike pays top athletes in many sports to use their products and promote and advertise their technology and design.

• In 1973 the company sponsored Romanian tennis star Ilie Năstase and American record holder athlete Steve Profantaine . In 1978 endorsed tennis “bad boy” John McEnroe.

• In 1979, it introduced Nike Air. Gas- filled plastic membranes were inserted in the sole to provide cushioning.

• In 1984, Nike signs Michael Jordan(NBA Player)into endorsement contract with Jordan Air (originally banned by NBA).

• Nike introduces Nike Air Max shoe with a television ad featuring the “Beatles” song “revolution”.

• In 1989, Nike enters European football market.• Nike has also sponsored many other successful

track and field athletes over the years, such as Carl Lewis, Jackie Joyner-Kersee and Sebastian Coe. The signing of basketball player Michael Jordan in 1984, with his subsequent promotion of Nike over the course of his career, with Spike Lee as Mars Blackmon, proved to be one of the biggest boosts to Nike's publicity and sales.

• Nike also endorsed Tiger Woods soon after he gave up his amateur golf status in 1996.