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Organizational Behavior Term Project Report

Building

OrganizationalCulture in Virtual

Organizations during

InfancySubmitted to: Mrs. Shagufta Rafif

Mohsin Ayub - 10566

Maria Iqbal - 10189

Muzammil Shahabuddin - 10969

Noman Ameen - 11122

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Building Organizational Culture in Virtual Organizations in Infancy

2

LETTER OF AUTHORIZATION

Dear Readers

As a student of MBA Executive, our course instructor of Organizational Behaviour Mrs.

Shagufta Rafif authorized us to conduct a research on the topic, Problems in setting an

organizational culture of Virtual Organization in Infancy. We were required to conduct the

research on the selected topic, in accordance with the acquired learning throughout the semester.

This report is conducted to identify the problems of setting an organizational culture for abusiness that has just begun its operation and to recommend solutions using OB techniques that

we studied throughout the semester.

The report is required to be submitted on 11th

December 2010.

Sincerely

Mohsin Ayub

Maria Iqbal

Noman

Muzammil

MBA (Executive)

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LETTER OF TRANSMITTAL

December 11, 2010

Ms. Shagufta Rafif

Institute of Business Management

Karachi

Subject: Problems in setting an organizational culture of Virtual Organization in Infancy

Dear Mrs. Shagufta Rafif

Here is the final research report on the topic, Problems in setting an organizational culture of

Virtual Organization in Infancy which you had authorized us to conduct at the beginning of

this semester. The report is now ready for your perusal.

This report is a brief portrayal of the problems being faced while setting an organizational of the

business working virtually. Furthermore this report also recommends solutions for encountering

these problems while using OB techniques. The only limitation that we faced during our research

was the deadline which we had to meet keeping in view the mass of data we gathered.

The making of this report has been a wonderful learning experience for us and we thank you for

giving us this opportunity to avail it. We have worked meticulously with our toiling endeavors to

provide you a real and complete picture of the current conditions of the problems that are being

faced while setting the culture of virtual organization. If you have any queries, please feel free to

ask. I would be glad to respond to your queries.

Sincerely,Mohsin Ayub

Maria Iqbal

Noman

Muzammil

MBA Executive

Institute of Business Management, Karachi.

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LETTER OF ACKNOWLEDGEMENT

December 11, 2010

Mrs. Shagufta Rafif

Institute of Business Management

Karachi

Dear Reader:

It has been a great honour for us to prepare a report on Problems in setting an organizational

culture of Virtual Organization in Infancy, which was assigned to us by our course facilitator

of Organizational Behaviour, Mrs. Shagufta Rafif, without her guidance and support the

compilation of the report would not have been possible.

Thanking you,

Sincerely,

Mohsin Ayub

Maria Iqbal

Noman

Muzammil

MBA Executive

Institute of Business Management, Karachi.

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Table of Contents

1. LETTER OF AUTHORIZATION .............................................................................................. 2

2. LETTER OF TRANSMITTAL .................................................................................................. 3

3. LETTER OF ACKNOWLEDGEMENT .................................................................................... 4

4. Table of Contents 5

5. Executive Summary .................................................................................................................... 6

6. Introduction ................................................................................................................................. 7

7. Rational for the Study (Why virtual organization) ..................................................................... 8

8. Problem Statement ...................................................................................................................... 8

9. Research Objectives .................................................................................................................... 8

10. Research Steps / Methodology.................................................................................................. 9

11. Research Design...................................................................................................................... 11

12. Sampling Approach ................................................................................................................ 12

13. Summary of Responses ........................................................................................................... 16

14. Analysis................................................................................................................................... 25

15. Conclusion & Recommendation. 26

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worldwide popular and bridging the gap through this virtual organization is an interesting

journey. Today over 30 million people in South Asia work online either through virtual

channels or through different channels in order to earn money. Therefore it would rather be a

substantial research to find out what factors are critical for the culture development within

virtual organizations, especially when it is in the starting phase.

INTRODUCTION

The concept of virtual organization is new to Pakistani market, so conducting a research

based on this new concept was a fun and learning experience as we learned a lot from this

research. Primarily running our own virtual organization also made the topic more interesting

for conducting the research. It then became easier for us to link the problems that we

researched to the problems that we faced practically and to draw out solutions from the

learning of organizational behavior.

The concept of virtual organization that we bear in mind explains as an organization in

cyberspace. Cyberspace specifically denotes the real and imaged space in which individuals

meet in electronically mediated and simulated space. The emphasis lies on the establishment

of an 'information space', which is created through the connection of computers and

computer networks. The creation of this space facilitates the sharing of information and

knowledge, as well as electronic communication. Virtual teams and virtual organizations

being a new concept obviously face many opportunities and challenges. However, still a

virtual organization is at greater risk of failure. The higher degree of risk in virtual

organization is a result level of independence that is given to the team of virtual organization

and the manner the management performs it duties virtually. Managing a team virtually itself

is a challenging task when you are not facing the person to whom you are assigning the jobs

practically. It then becomes difficult to analyze the person whether he would be able to the

work appropriately or if he is well committed to his work. Furthermore applying the same

techniques for managing human resource for the people working in virtual organization

would be a blunder in itself. Hence coming up with innovative and applicable ideas for

managing team in virtual organization and identifying the problems in the implementation of

those ideas is the core objective of the report. Thus the report is designed in a manner that it

is not only a learning experience for us but it will be a learning experience for all the readers

who will be reading the report.

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RATIONAL FOR THE STUDY (WHY VIRTUAL ORGANIZATION)

We have been involved in the virtual organization business for the past 5 years, and dealing

with employees who are not present in front is entirely different from what we observe in the

practical world. People have a misconception regarding the building up of culture and

maintaining the norms within a virtual organization, however the practical scenario is very

different from what people perceive about virtual organization. Although the business

processes are pretty much similar from hiring to operations, however performing of operation

is done on a different basis and employees need to be managed differently as well.

We have observed the increasing trend of virtual employees during the recent times and

being a part of the same, we feel that our research will contribute to our organization as well.

PROBLEM STATEMENTHypothesis

H1: A strong culture can be built in the initial phases of virtual organization

H2:A strong culture cannot be built in the initial phases of a virtual organization

Problem statement:

To find out the factors that impact in the culture building of virtual organization in the starting

phases.

RESEARCH OBJECTIVESThe goal of our study was to gain an improved understanding of the problems being faced by the

virtual organizations in setting of their organizational culture. The purpose of this study was to

investigate the problems thoroughly that are faced by the virtual organizations and then on the

basis of the identified problems recommend appropriate organizational behaviour techniques to

encounter these problems. The prime objective of this research was to put light on the different

aspects that might occur while setting the culture for the newly starting organization primarily a

virtual organization which a new concept for conducting business these days and gaining

popularity day by day.

The fundamentally important research question for our study is:

To identify the key drivers of setting organizati onal culture of virtual organization in

infancy

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In addition to the above two primary research objectives, another auxiliary goal of this analysis

was to gain firsthand experience of business research. The application of concepts in the courses

of Organizational Behaviour and Methods of Business Research, which form a critic al part

of the MBA program at IOBM, is critical to understanding how organizations gain marketinginformation. These market insights are essential for making right business decisions.

The project gave the team members an opportunity to get involved in a study that included the

phases of problem definition, research design and analysis.

RESEARCH STEPS / METHODOLOGY

The research method adopted was a structured process which went through the following steps,as detailed below:

Step 1: Brainstorm ideas

The research project kicked off with a brainstorming session of the topics via emails that

defined the domain of the research. Once the domain of research was defined as

Problems in defining the organizational culture of virtual organization, the team

progressed to identify the parameters of the research within this topic.

Step 2: Group Meeting

The first review meeting was then held to discuss and finalize the project proposal as the

first deliverable for this organizational behaviour project. The project proposal parts and

deliverables were then assigned amongst the team members.

Step 3: Research design and medium selection

Appropriate research medium was the necessary element of the report for reaching the

consumer and recording their responses while considering constraints of time and money.

Hence for the purpose only quantitative research was conducted and questionnaire was

design to evaluate problems in setting an organizational culture for a virtual organization

in infancy.

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Step 4: Online Survey

The survey techniques used for gathering the responses was through online survey. The

reason for using online survey as the medium of gathering the responses from the target

audience was due to the fact that it provided convenience to the respondent and through it

diversified data could be gathered. Since our topic was also such that focused mainly on

the audience that worked online, thus online survey helped us a great deal in achieving

our purpose.

The basic advantage of using online survey was to avoid cumbersome, error-prone task of

compiling results using a coding scheme, which had to be specifically designed for

manual questionnaires. Moreover there was no requirement of Survey ID to be

maintained manually.

Step 5: Online survey on Google Docs

In order to facilitate and ease the process of survey with least probability of error we

opted for designing the survey using the survey tool of Google Docs. The format of the

questionnaire was MCQ based and there was no requirement of coding scheme as the

data was analysed automatically by the Google survey tool.

Using this tool for conducting the survey not only provided ease but it also provided

applications which helped us in the data analysis. It also gathered the data on the single

spreadsheet that was quite time saving for us during the analysis phase

Step 6: Pre-test

A pre-test was then conducted to ensure that a typical subset of our sample size interprets

the questionnaire correctly and has the same understanding of questions as the research

team. The feedback from this step further improved our questionnaire phraseology and

hypotheses.

Step 7: Model Testing

The pretesting done further ensured that the questionnaire designed in this manner was

accurately obtaining responses and was saving them in appropriate manner. Moreover the

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analytics tool of Google was also tested to ensure that analysis will be error prone. After

an end-to-end execution of the process, we launched the survey. All that was left after

this stage was to get the questionnaires filled in the available template and the results

would be computed automatically.

Step 9: Launch and Data Collection

The survey was then launched and was ready for data collection. The survey was

judgemental and convenience based. Since the topic we chose for the research was such

that we knew the target audience that was appropriate for getting the responses. Thus we

used academic and social networks for circulation of the survey. We circulated the survey

link in our social network of which we thought it will be appropriate to get the response,

moreover we also circulated the survey link within our CBM network. The total sample

size, hence, was 200 responses.

Step 10: Analysis

Graphical analysis and hypothesis results were then calculated based on the responses

received. The details of analysis and tabulation of results follow in subsequent sections.

Step 11: Results and Conclusions

Conclusions were drawn from the results of the hypotheses and documented.

9. RESEARCH DESIGN

The research design utilized both quantitative and qualitative methods. Since Virtual

organizations are getting popularity in Pakistan as well so a kind of research like this was

necessary to analyse the major cultural factors that can have an effect on organizations like this.

The research was carried out using a two phased approach. In the first phase we identified the

key drivers based on the research through secondary mediums in which internet was our mainsource for data collection. From the journals available online and E-books we studied different

aspects of culture of a virtual organization. The results from those were utilized in designing the

quantitative research.

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10. SAMPLING APPROACH

The sampling of the research was tailored to primary target the segment of Karachis population.

The concept of virtual organization and to run a business virtually seems to be popular among

youth and people in the age group early 40s as these are the people who are technologically

aware and dont have any issues while operating their day to day task on computer. Hence the

sampling method used in the survey was judgemental plus convenience due to resource

constraints. Resources, both in terms of time and costs, were considered when doing the pre-

study. The project team used their personal, academic and professional networks for the survey.

The e-mail request to fill up the online questionnaire included well-thought through sentences to

create the snow-balling effect to get maximum respondents to fill up the questionnaires.

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Online questionnaire snapshot

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11. SUMMARY OF RESPONSES

100responses

Background

Engineer 50 50%

IT/ Communication 25 25%

Business 14 14%

Medical 6 6%

Law 1 1%

Other 4 4%

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Building Cultures - Although the employees are happy and contented, they give only passive cooperation.

1 Almost never 8 8%

2 Seldom 22 22%

3 Occasionally 20 20%

4 Frequently 37 37%

5 Almost always 9 9%

Building Cultures - Both managers and employees want to create better job performance.

1 Almost never 5 5%

2 Seldom 4 4%


4 Frequently 36 36%


Building Cultures - There is a partnership between managers and employees

1 Almost never 16 16%

2 Seldom 21 21%


4 Frequently 23 23%


Building Cultures - Although people obey their leader, they do not respect the leader


2 Seldom 14 14%


4 Frequently 32 32%


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Building Cultures - Management's main concern is too make money

1 Almost never 2 2%

2 Seldom 9 9%


4 Frequently 29 29%


Building Cultures - The employees feel they are part of the organization


2 Seldom 16 16%3 Occasionally 36 36%

4 Frequently 20 20%


Building Cultures - When things go wrong, the main concern is to fix it, not to lay blame.


2 Seldom 27 27%


4 Frequently 20 20%


Building Cultures - There is enthusiasm among the employees to better job performance

1 Almost never 2 2%

2 Seldom 11 11%


4 Frequently 30 30%


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Building Cultures - Although the employees have good benefits, they tend to give only minimal

performance


2 Seldom 34 34%


4 Frequently 17 17%


Building Cultures - The employees feel their jobs hold high esteem and are of great value to the

organization


2 Seldom 20 20%


4 Frequently 27 27%


Building Cultures - Most of the employees seem content to stay in their position


2 Seldom 24 24%


4 Frequently 17 17%


Building Cultures - Employees are part of the decision making process

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2 Seldom 26 26%


4 Frequently 8 8%


Our organization is good at fulfilling their mission

1 = Strongly Disagree 27 27%

2 = Somewhat Disagree 9 9%

3 = Neither Agree nor Disagree 18 18%

4 = Somewhat Agree 28 28%

5 = Strongly Agree 14 14%

- My organization's culture follows the company's mission






My organization's culture is shaped by internal factors






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Gift taking and Gift giving is acceptable norm in my organization






There are In-Groups and Out-Groups in the management






The organization is justified to everyone's performance






My Organization culture is strong






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There are high rules and regulations for every work (SOP)






My Boss is always in front of me when i work






I am intensely monitored during my working hours






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12. ANALYSIS

Through the analysis of data we managed to figure out that strong culture although has great

influence in organizations operating practically, but when it comes to virtual organization, astrong culture can be developed only through effective culture building strategies and

exceptional leadership skills. Even in the virtual organizations the leaders play the most

important role in building up organization culture and norms. The virtual organizations norms

are a little different from physical organization but the impact of culture is as important in this

regard as it can be in any other organizations. The most prominent thing that comes along in the

virtual organizations culture is the ability to work under diversified workforce. The modern

trends of organizations are changing and with the huge impact of globalisation every

organization has to learn the ability to deal with virtual organizations as well.

Our research has proven that workers expect their leaders to motivate them, help them and built a

personality regardless of the fact that the sub ordinate is present in front or not. The charisma of

leaders, the rule of organizations and the values of employees can be equally managed virtually

as well. The core thing is upon the organization and its management how it builds up the culture

from infancy and how it helps its employees to nurture even if the employee is not present in

front physically.

As far as the change of culture within organizations is concerned, for any organization

attaining the future state through its vision is done through the process of change management.The process of change management starts with the creation of the vision and with the

empowerment of the individuals who act as change agent for the accomplishment of the vision.

In order to have effective change management it is required to have a plan that is realistic and

applicable for the change agent. Change management is thus the process of applying effective

strategies and plans for enabling the change agents in the achievement of the vision.

Change management is thoughtful and creative process which involves planning,

implementation, consultations and the involvement of the individuals who are affected by the

change process. For the change to take place it is essential that it should not be enforced and the

necessity of change should be developed so that everyone understands the need of change and

are ready to adapt that change. Forceful implementation of change might result in creation ofproblems. Furthermore change must be such that it should be realistic, achievable and

measurable. Prior for going to the organizational change it is essential that one should ask

himself what are the objectives that they need to achieve from the applied change, why the

change is important, how many people will be affected by the change and how the people will

react to the change? The answers to these questions are significant in the sense that whether the

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change that is being made is necessary or not. If it is going to be profitable or not and what are

the elements that will be affected

Organizational Cultural Change management is a complete process that needs to be

understood and managed in a way that people affected by it can effectively cope with it. No

matter whether the change is of level one or of level two that is if there is one process change ormultiple processes change its a common practice that during the process of change one might

feels uneasy and frightened from the scale of challenge that may occur.

13. CONCLUSION & RECOMMENDATION

Organizations in Pakistan had been not very proactive in the past years, and due to this

reason their employees were not enjoying great benefits. The technology change that came into

the Pakistani IT industry has changed the whole scenario of organizations today. Virtual

organizations have emerged and have given a tough competition to the competitors in the

industry. Today, no organization can survive if its attitude and culture enforces them to remain

reactive rather than proactive. If the culture persist employees to have a proactive attitude, this

let them to grow further in other countries as well. Due to globalisations, virtual organizations

provide all possible facilities within their limits to their employees and if the employees are able

to understand and change their behaviour according to the organizational culture they are sure to

excel on every ground.

Documents

OB report4