The relationship between organizational culture, leadership and strategic planning in the public organization: a case study of the Saudi Telecom Company (STC)
1.0 Overview
The divergence in organizational cultures are brought about by bureaucracies with sense-thinking managers, matrix organizations with intuitive-thinking leaders, organic organizations with intuitive-feeling leaders and familiar cultures with sensing-feeling members. Inherent to the organizational culture are many values as task-related values and relational values that deal with people as individuals and as organization members. The culture of an organization is intertwined with the philosophy, purposes, functions and structures and wherein organizational members develop mutually-accepted ideas and beliefs regarding what is real, what is important and how to respond. Further, the importance of leaders is viewed as main transmitters of organization’s culture and values. Leaders act as builders, as maintainers and as watchdogs of organizational culture and values per se (as cited in Bass, 1990, pp. 586-588).
Bass argued that leaders could function as founders of cultures, of counter cultures and even act as agents of change in dominant cultures. Antecedent leaderships are the main source of organization’s culture and it affects the subsequent leader-subordinate relationships in several ways (1990). The founding or organizational cultures relates to a preconceived ‘cultural paradigm’ that could either strengthen or damaged the entire organization. As culture-builders, leaders understand the power of culture, values and integrating them into the organization. The need for leaders to be cultural facilitators is manifested in the daily management structures and routines in order to achieve organizational purposes or end values.
Aside from the reality that leaders create culture, countercultures and changing the dominant cultures, the leaders’ role also deals with managing the culture and maintaining them as always acceptable. Leaders must develop new values and recognize emerging values while exploiting existing values. An aggressive approach is necessary at this stage to facilitate the expansion of organization’s knowledge and value base. Organizations may further identify themselves with internal and external sources of knowledge, values and corporate culture. Internal processes involve creation, as discussed above, integration and dispersal of culture within the boundaries of the organization. External process is a two-step process wherein organization members are exposed to outside culture and then transfer them to other members inside the organization (Choo and Bontis, 2002 p. 280).
Organizational evolution in midlife is apparent in the changing dynamics of culture and leadership. As groups mature they develop subgroups. The consideration of microcosm reflects a degree of relativity. The creation and management of subcultures are other tasks for leaders. More than being integrators and facilitators, leaders are required to have keen observation and scrutinizing skills. Leaders must carefully examine the emerging trends in culture and employee behaviours. In this process, leaders could manipulate the culture for their own term and in effect, leaders could maintain equilibrium and maximize autonomy while motivating changes even in the presence of an external force (Harvey and Brown, 2006; Schein, 2004).
Strategic planning, on the other hand, is defined as the development of necessary procedures and operations to achieve organizational success (Pfeiffer, et al, p. 3). Strategic planning can be viewed as a systematic approach. Strategic planning is situational analysis of what the current performance of the organisation is and how the organisation could pursue a global strategy (Johnson and Scholes, 2002).
2.0 Background
The contemporary organizations including both public and private have witnessed changes that require the shift on organizational mindset. Organizational are being jeopardized and subjected to such changes. As public organizations became larger, more complex and more problematic, concerns about leadership competencies development and how it could likely to impact culture and direction of the organization have been in the forefronts of business dialogues. There had been much talk about leaders and their development but very little has been done on developing leadership in accordance with organizational culture and much little progress on investigating leadership, organizational culture and its relative effect on strategic planning of public organizations and particularly on Saudi public organizations. What makes Saudi public administration even more a difficult case is that organizational culture inherently embraces the philosophies and teachings of the Q’uoran. Leadership is linked to lineage and social status and strategic planning is for the achievement of publicly stated goals.
Organizational culture has been a valuable determinant to guide strategic planning towards diversity and global competence. Leadership, however, is about change and leadership competency development lies on both individual and organization-related experiences. As such, the culture of the organization and the prevalent leadership initiatives are keys for the organization to envision its future and to develop the necessary procedures and operations toward the achievement of such future hence a process called strategic planning. But, this is not without difficulties as there are elements uniquely identified on the peculiar set-ups of public organisations. For instance, Saudi Arabian public sector represents a large percentage of the economy. Saudi public organizations, in addition, are intertwined in the institutions of government and community. Several factors responsible for this state of nature should be therefore considered in order to arrive at a comprehensive picture of the interconnection between organizational culture, leadership and strategic planning in public organizations in Saudi Arabia.
Saudi Telecom Company (STC), on the other hand, is a Saudi Arabia-based telecommunication company that specialises in landline, mobile and Internet services. The government of Saudi Arabia holds 70% of the share while the remaining share allots for general organisation for social insurance, public pension fund and the public. Saudi Telecom was ranked as Saudi Arabia’s fourth largest company despite its strategy to mainly focus on affluent areas of the Kingdom including high net worth individuals’ residents, government bodies, government officials and large businesses areas.
3.0 Review of the Literature
Public organizations in Saudi Arabia
Saudi Arabian public organizations are enveloped in an over-centralized governance of government ministries hence entrepreneurial enthusiasm, ability and cosmopolitan outlook were minimal because many of Saudi Arabia's industrial and service organisations are in total or substantial government control (Drummond and Al-Anazi, 1997). Further, Attiya (1999) assert that the effectiveness of Saudi Arabian public organizations is dependent on a conflict-free and cooperative work climate.
Organizational culture of public organizations
According to Klein, Waxin and Radnell (2009), culture is a key dimension of corporate performance. When the authors examined the potential impact of Arab national culture on the style of organizational culture, the study discovered that national culture has profound effects on styles of organizational culture. Thus, to better comprehend the variability of performance in their key outcomes, at the individual, group, and organizational levels, one must understand the role that national culture play in the development of the styles of organizational culture in public organizations.
Al-Ahaya (2009), particularly, found out that organizational culture has some impact on decision-making and other work related outcomes. Based on his study on public sector organizations in Saudi Arabia, the author came to know that elements of organizational culture had significant effects on information sharing, decision quality, predictability and acceptability of authorized decisions by employees, job satisfaction, and motivation.
Leadership in public organizations
Saudi-Arabian managers are apparently averse to innovation and risk, restrained by fear of failure. Such caution is reflected in relatively high reliance upon authority and relatively low delegation compared to North American organisations. The evidence is conflicting, however, as some enquiries suggest a high preference for consultation and participation amongst Saudi-Arabian managers. As such, there are two weaknesses that Drummond and Al-Anazi (1997) identified. First is that perceptions of the leaders rather than the led is more prioritized A manager may perceive himself, (it is invariably him in Saudi-Arabia), as participative or authoritative but there is no guarantee that this perception is shared by his subordinates. Second, there could be the possibility of variation in leadership styles between different organisations. Whilst it may be true that Saudi-Arabian managers are generally risk averse when compared to their North American counterparts, this does not mean that all Saudi-Arabian managers are equally cautious and reactive.
Hunt and At-Twajiri (1996) had investigated that Saudi Arabian managers are increasingly becoming conscious of the critical role of managerial values. The importance of value congruence requires that managers should align personal values with organizational values by which the shared values will be based. As such, the organization’s productivity depends on the degree to which values is integrated on different levels and functions in the organization. The authors noted that the Muslim-based culture of Saudi organizations had a basis of shared values regardless of functions and levels but with one exception which is marital status.
Strategic planning at public organizations
Al-Ghamdi (2005) investigated the importance of strategic planning tools and techniques for Saudi Arabian organizations. The author found out that out of the 72 Saudi organizations, only 10% of the planners reported using these techniques regularly with an additional 17% saying only use them frequently. Al-Ghamdi (2005) related that the most regularly and widely used technique is analysis of critical success factors, followed by benchmarking, and then what if analysis. SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis, product life cycle, and stakeholder analysis had received moderate use, while PIMS (Profit Impact of Market Strategy), experience curve, portfolio analysis, and value chain analysis had received very limited use. Finally, Delphi, cognitive mapping, and Porter's five-force analysis were found to be the least used tools in the sector analysis.
4.0 Statement of the Problem
Little research had been done to address the conceptual linkage between organizational culture, leadership and strategic planning particularly in public organizations and in Saudi Arabia particularly for the telecommunications industry. Whether it is important for Saudi public organizations to coordinate and associate organizational culture with leadership and strategic planning is not yet explored. The participative nature of organizational culture and leadership will greatly impact strategic planning and hence the organizational effective of public firms. A challenge for Saudi public sector is the development of long-term results oriented approach that is truly strategic since the sector is faced with the peculiarities inherent in organizational culture and leadership practices. Towards making public administration and governance effective and fiscally responsive for Saudi Telecom Company, aligning culture and leadership styles with the strategic plans is then a priority. However, the relationship between these three aspects would not be an easy task for the management of STC considering the divergent setting of this public organization. Therefore, this research will focus on establishing the association among organizational culture, leadership and strategic planning in public organizations and in telecommunications industry per se in Saudi Arabia and how they likely affect the conduct and practices of each. The study will be based upon the case of STC.
5.0 Research Questions
How does organizational culture, leadership and strategic planning relate to one another within STC?
Specifically, the following questions will be addressed:
6.0 Objective of the Study
The main aim of this research is to examine the conceptual and actual interplay among Saudi public organizations’ organizational culture, leadership and strategic planning through investigating the case of STC. In lieu with this, the study will seek to address the following research objectives:
- Explore the three aspects’ contributions in achieving achievement and developments in public telecommunications companies
- Investigate various organizational, leadership and strategic elements within STC
- Analyze the importance of integrative strategic planning for STC
7.0 Methodology
The study will explore the problem in an interpretative view, using a descriptive approach which uses observation and surveys. To illustrate the descriptive type of research, Creswell (1994) will guide the researcher when he stated: Descriptive method of research is to gather information about the present existing condition. The purpose of employing this method is to describe the nature of a situation, as it exists at the time of the study and to explore the cause/s of particular phenomena. The researcher opted to use this kind of research considering the desire of the researcher to obtain first hand data from the respondents so as to formulate rational and sound conclusions and recommendations for the study.
Case study method will be also employed in the study since it focuses on Saudi Arabian public organizations alone. A case study is a “strategy for doing research which involves an empirical investigation of a particular contemporary phenomenon within its real life context using multiple sources of evidence” (Robson, 2002)
Primary and secondary research will be integrated. The reason for this is to be able to provide adequate discussion for the readers that will help them understand more about the issue and the different variables that involve with it. In the primary research, public managers will be surveyed. A structured questionnaire will be developed and it will be used as the survey tool for the study. On the other hand, sources in secondary research will include previous research reports, newspaper, magazine and journal content. Existing findings on journals and existing knowledge on books will be used as secondary research. The interpretation will be conducted which can account as qualitative in nature.
8.0 Significance
Public sector organizations are attempting to innovate and advance their organizational effectiveness through introducing changes that will motivate them to improve their level of performance. New ways and methods of organizational, operational and leadership development are continuously being pursued in pursuit of achieving effectiveness and efficiency. The importance of this research is based on the argument that Saudi Arabian public sector is determined to position itself in the broader global context hence understanding its organizational culture, leadership structure and practices and strategic planning is important. This study is expected to have profound implications for organizational and leadership development in Saudi public administration as these are considered as a bureaucracy in transition.
9.0 Research Design
Sample
Questionnaires will be sent to STC’s directors, managers and supervisors. STC is one of the 115 publicly traded companies in Saudi Arabia listed in the Tadawul All Share Index (TASI).
Questionnaire
For this purpose, a questionnaire will be designed in which all the items were scored on a five-point Likert scale with end points of strongly agree and strongly disagree. The questionnaire will be divided into four areas namely demographic profile, organizational culture, leadership and strategic planning.
Subject
Executive members of STC.
Data analysis and presentation
Responses will be quantified using weighted mean and percentage with the following formulas:
1. Weighted Mean
f1x1 + f2x2 + f3x3 + f4x4 + f5x5
x = --------------------------------------------- ;
xt
where: f – weight given to each response
x – number of responses
xt – total number of responses
2. Percentage – to determine the magnitude of the responses to the questionnaire.
n
% = -------- x 100 ; n – number of responses
N N – total number of respondents
Pearson correlation will be also used to find the relationship among the variables.
The thesis will be presented in written form with the addition of data charts which will present the project’s results. Pie charts and network charts will be needed to illustrate some of the analyzed data. This cannot be confirmed, however, until the research data have been analyzed.
10.0 References
Al-Ahaya, K O 2009, ‘Power-Influence on Decision Making, Competence Utilization, and Organizational Culture in Public Organizations: The Arab World in Comparative Perspective,’ Journal of Public Administration Research and Theory, vol. 19, no. 2, pp. 385-407.
Al-Ghamdi, S M 2005, ‘The Use of Strategic Planning Tools and Techniques in Saudi Arabia: An Empirical Study,’ International Journal of Management.
Attiya, H S 1999, ‘Public organizations effectiveness and its determinants in a developing country,’ Cross Cultural Management: An International Journal, vol. 6, no. 2, pp. 8-21.
Bass, B M 1990, Bass and Stogdill’s Handbook of Leadership: Theory, Research and Management Applications, 3rd ed., Free Press, New York.
Choo, C W and Bontis, N 2002, The Strategic Management of Intellectual Capital and Organizational Knowledge, Oxford University Press, US.
Creswell, J W 1994, Research design. Qualitative and quantitative approaches, Sage Publications, Thousand Oaks, California.
Drummond, H and Al-Anazi, F B 1997, ‘Leadership styles in Saudi Arabia: Public and private sector organisations compared,’ Cross-Cultural Management: An International Journal, vol. 4, no. 4, pp. 3-8.
Harvey, D and Brown, D 2006, An experiential approach to organization development, 7th ed., Prentice Hall, Upper Saddle River, NJ.
Hunt, D M and At-Twajiri, M I 1996, ‘Values and the Saudi managers,’ Journal of Management Development, vol. 15, no. 5, pp. 48-55.
Johnson, G and Scholes, K 2002, Exploring Corporate Strategy, Prentice Hall.
Klein, A, Waxin, M F and Radnell, E 2009, ‘The impact of the Arab national culture on the perception of ideal organizational culture in the United Arab Emirates: An empirical study of 17 firms,’ Education, Business and Society: Contemporary Middle Eastern Issues, vol. 1, no. 1, pp. 44-56.
Pfeiffer, J W, Nola, T M and Goodstein, L D 1993, Applied Strategic Planning: A Comprehensive Guide, McGraw-Hill Professional.
Robson, C 2002, Real World Research, 2nd ed., Blackwell, Oxford.
Schein, E 2004, Organizational Culture and Leadership, 3rd ed., Jossey-Bass San Francisco, CA.
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