Organizational Culture in Kinder Morgan

Organizational Culture in Kinder Morgan

Introduction

Organizational culture is defined as all the values and behaviors that contribute to the unique social and psychological environment of an organization. These values and behaviors can affect an organization either positively or negatively. Positive organizational culture motivates the employees who in turn increase their productivity and this translates to a profit for the organization. On the other hand, a negative organizational culture demotivates employees, reduces their productivity and this becomes a loss for the organization. An example of an organization is the Kinder Morgan company that has a large employee number. Kinder Morgan is one of the largest energy infrastructure companies in North America. It deals with natural gas as well as refined petroleum products, crude oil, carbon dioxide and other energy products. Kinder Morgan has as estimated 11,000 employees across all branches. This paper will look at how organizational culture of Kinder Morgan company and how it has affected employee performance and the organization as a whole

Based on the organization you selected, describe the organizational culture, applying concepts from the course. To what degree does the organization’s culture drive employee alignment with the stated values and beliefs.

Kinder Morgan has a large employee and the operations of the organization are dependent of the productivity of the employee. For employees to increase their productivity, they must be motivated on a regular basis failure to which their productivity reduces drastically. That is one of the reasons Kinder Morgan has an employee-based vision because they understand that human resource is an invaluable resource.

in line with kindermorgan.com (2015), the goal of the company is to cultivate an inclusive environment where employees thrive and careers flourish.  This implies that the organization values the contributions and the opinions of the employees which creates an interactive environment which is encourages innovation and formation of new ideas. According to Fred (2002), there has been an implicit truism in the organizational behavior field through the relationship between positive feelings of employees and their performance; such include positive reinforcement, positive affection and emotion even humor. Therefore, when the employees at all levels are motivated to interact, it creates a good social environment and when their opinions are recognized and considered, they feel important which affects their psychology positively.

Explain how organizational culture may result in functional or dysfunctional effects on people and the organization. Discuss issues important to creating an ethical and positive organizational culture.

Organizational culture can have adverse effects of the organization because of the effects it has on people. If a group has had a long and intense history, it will have a strong and highly differentiated culture with maximum effect (Edgar, 1984). The degree to which this culture affects the performance, attitude and productivity of the employees is determined by the functionality of the organization.  If a culture has a positive effect, the organization flourishes but if the culture has negative effect, the organization collapses. For instance, Kinder Morgan spends hundreds of millions of dollars each year on integrity management and maintenance programs to operate their assets safely and to protect the public, their employees, contractors and the environment (kindermorgan.com, 2015). This means that this organization places much importance to the psychology of the people who interact with it and especially the employees. Furthermore, the organization ties financial incentives for their employees directly to the performance of the company and their own personal performances. This culture helps to motivate the employees to increase their productivity because the success of the organization means a higher financial incentive. Apart from creating an organizational culture that supports, productivity, it is equally important to have a culture that emphasizes on ethical behavior. One such culture is transparency in organizational transaction. Kinder Morgan has such a culture where it conducts its business transparently by publishing its annual budget on its web site, which enables investors and others to follow their progress throughout the year; they also post their operational performance on their website and continues to perform better than their industry peers relative to environmental, health and safety measures (kindermorgan.com, 2015). This culture of transparency impacts positively to their employees who from the first day of work understand that transparency and integrity is a key tradition in the organization.

Based on the organization you selected for this project, describe and assess the effectiveness of the formal and informal structures in supporting employee performance.

The structures of supporting employee performance have a direct impact on their attitude and productivity. According to Arne (1977) the attitudes of workers are seen as a direct, one-to-one reflection of the structure of the work place. Therefore, it is important for an organization to adapt and implement effective structures that support employee performance. Formal structures involve written and explained managements and divisions of the company that explain to all employees how the organization runs its operations. The working schedules are laid down and as well as how each level of management is supposed to work in order to prevent misunderstanding and confusion. In a formal structure, employees are expected to implement decisions and processes made at the levels above them, and they are not usually consulted for their opinions or ideas about how the company should operate. Informal structure on the other hand, the organization does not operate under guidelines of written documents or spelt out rules. Major decisions are made by employees who have proven effective who also get opinions from other employees before reaching a final decision. The success of an informal structure is based on the personality and competence of the employees. In most instances, formal structures are effective but only because of the pressure placed upon the employees. Too much pressure eventually leads to a decrease in employee productivity. Furthermore, when the opinions of the employees are not considered, they develop a negative attitude towards the organization. Kinder Morgan company utilizes both formal and informal structures whereby there is a documented managerial structure which takes employee opinions into consideration. The organization Executive chairman is in charge of executing the vision of the company and he also allocates capital to all Kinder Morgan business units in a disciplined manner. In addition, Kinder Morgan has a diversity and inclusion policy that provides a sound basis that demonstrates their commitment to accommodating individual differences and creating a fair workplace environment for all (kindermorgan.com, 2015). This combination of structures provides an environment where authority is recognized and respected and, in the process, the opinions and ideas of the employees are heard and implemented. The combination of these two structures are effective when it comes to supporting employee performance.

Conclusion

Organizational structure plays a major role in influencing employee performance in a business institution. Employee performance translates to success or failure of an organization. A good organizational culture should aim to create a conducive working condition by involving the employees in decision making processes, recognizing and rewarding efforts as well as encouraging interaction at all levels of management in order to increase chances of innovation. A good organizational culture should not only aim at increasing productivity but also emphasize on ethical behavior. This ensures the organization has productive and ethical employees. Seeing the benefits of organizational culture, every organization should strive to achieve a strong, positive and effective culture.

 

References

Kalleberg, A. L. (1977). Work values and job rewards: A theory of job satisfaction. American sociological review, 124-143.

Kinder Morgan. Retrieved from https://www.kindermorgan.com/pages/about_us

Luthans, F. (2002). The need for and meaning of positive organizational behavior. Journal of organizational behavior, 695-706.

Schein, E. H. (1984). Coming to a new awareness of organizational culture. Sloan management review, 25(2), 3-16.