The Internal Environment Includes:

The internal environment (IE) of an organization includes organizational culture, values and climate. An organization can directly control, manage and influence its internal environment.

1. Organizational Culture

Organizational culture is the set of shared values, beliefs, assumptions, practices, etc., that shapes organizational behavior which influences people’s behaviors working in the organization. It provides guidance to members in following mission, vision, objectives & goals of organization and adopt strategies to achieve goals based on the organization beliefs. For example, if the organization belief is to provide quality service, then based on this belief, strategies are implemented, i.e., professional and skillful workers and employees are hired to provide quality service to customers.

It also provides guidance to members during business hour on how to behave with members, customers, stakeholders, etc. For example, how to communicate with customers in order to address their problems, how to dress up during office works, etc.

Strong Organizational Culture

In a strong organization culture, there are clear mission, vision, objectives and goals, clear corporate strategies which are followed by the members of the organization and they behave strongly, to get desired results.

Advantages of Strong Organizational Culture

(i). Increase In Performance

As, the members follow clear plans to achieve organizational goals, the performance of organization increases as everyone focus on set plans and make collective efforts to achieve common goals.

(ii). Quality Service

The quality of service increases as the resources of the organization utilized efficiently and effectively. For example, professional staff work effectively to do the work in time, quick response is given to customers, etc., are possible in strong organizational culture.

Disadvantages of Strong Organizational Culture

(i). Follow Old Practices

When new methods and practices are developed to work effectively, or when new competitor appear in the market with latest strategies, then there is need to change old methods and techniques which, now, are no longer work any more and become ineffective.

How To Build A Strong Organizational Culture

Building a strong organizational culture takes time, however, following steps can be taken to implement and manage this culture in the organization:

(i). Set By Example

The top management should act by its actions and set an example for other members in the organization to follow organizational goals.

(ii). Mentioning Goals In Speech

The top manager tells about organizational objectives and goals in his speech on regularly basis, so that members memorize the main objectives and goals of the organization to behave accordingly.

(iii). Performance System

If there is a performance system in the organization, then members are encouraged to work effectively to achieve common goals as they are appreciated and rewarded on the basis of their performances.

Weak Organizational Culture

In this organizational culture, the mission, vision and goals are not clear. There are no clear cut strategies to be followed. There is no specified direction and proper guidance to get targets. So, the performance of the management will be worse at the end which resulted in the failure of the organization.

2. Organization Climate

It is the shared perception of members of an organization about organizational culture they learned from experience and show with their attitudes and behaviors. If this climate looks excellent, then it shows high performance, high morale, excellent coordination among members, etc., of the organization.