Organizational culture - a case study of Novo A/S by WeCollaborate.org

Organizational Culture and Cohesiveness

Table of Contents Management Report .................................................................................................................................4 1 Introduction ..........................................................................................................................................6 2 Literature Review and Theoretical Framework .......................................................................9 2.1 Organizational Culture: An Overview .....................................................................................................9 2.2 A Cultural Unit ................................................................................................................................................................ 9 2.3 Culture Defined ........................................................................................................................................................... 10 2.4 The Integration and Fragmentation Perspectives of Culture.................................................................. 11 2.5 Managers’ Role in Organizational Culture ....................................................................................................... 13 2.6 Code of Conduct: A Means to Managing Diversity........................................................................................ 14 2.7 A Conceptual Model of Analyzing Culture ....................................................................................................... 16

3 Methodology and Project Framework ....................................................................................... 19 3.1 Project Structure......................................................................................................................................... 19 3.2 Methodology................................................................................................................................................. 19 3.3 Project Relevance ....................................................................................................................................... 22 3.4 Limitations.................................................................................................................................................... 23 3.4.1 Critical Appraisal of Primary Data................................................................................................................... 24 3.4.2 Critical Appraisal of Secondary Data.............................................................................................................. 24

4 Novo A/S in Brief............................................................................................................................... 26 5 Analysis ................................................................................................................................................ 29 5.1 The Novo Group: One Culture?............................................................................................................... 29 5.2 Organizational Culture in Novo A/S ..................................................................................................... 30 5.2.1 Culture Conclusion ................................................................................................................................................. 35 5.3 Conflicts Between Two Diverse Groups .............................................................................................. 35 5.3.1 The Culture Group .................................................................................................................................................. 36 5.3.2 Code of Conduct....................................................................................................................................................... 37 5.3.3 Six Action Points...................................................................................................................................................... 39 5.3.4 Conclusion.................................................................................................................................................................. 40 5.4 A Cohesive Culture ..................................................................................................................................... 40

6 Discussion ........................................................................................................................................... 44 6.1 A Diverse Workforce ................................................................................................................................. 44 6.2 Multiple Cultures ........................................................................................................................................ 46 6.3 Cultural Change ........................................................................................................................................... 47

6.4 Cohesiveness ................................................................................................................................................ 48

7 Conclusion........................................................................................................................................... 50 8 Further Perspectives ....................................................................................................................... 52 Bibliography............................................................................................................................................. 53 Books and Research Papers ........................................................................................................................... 53 Websites .............................................................................................................................................................. 54 Novo’s Internal Documents ............................................................................................................................ 54

Appendix 1 ................................................................................................................................................ 56 Appendix 2 ................................................................................................................................................ 59 Appendix 3 ................................................................................................................................................ 63 Appendix 4 ................................................................................................................................................ 63

Management Report

Research Issue This project reports the complex organizational issue of culture. The aim has been to find ways of understanding culture and, thereby, investigating culture’s importance and influence on organizations. This project builds upon a former cultural analysis of Novo A/S conducted by external Facilitators and investigates the link between cohesiveness and structural fragmentation and diversity of people. As the “culture mission” of Novo A/S has been to create a cohesive culture so that conflicts within the organization could be solved, the tools used for enforcing cohesion has been analyzed and discussed. The implemented Code of Conduct has been the primary area of investigation and has formed the basis of the Research Question sought answered: Can a cohesive organizational culture be obtained through a Code of Conduct, and if so, why? The research question has leaded me to test my theory with the following hypothesis: A cohesive organizational culture is generally not feasible in an organization with structural fragmentation and diverse people.

Main Findings The research conducted has shown that Novo A/S is a structural fragmented organization which has resulted in a cultural “gab” between two groups of people: the “office‐based” and the “out‐in the‐field”. These two groups are formed with diverse people who share similar work‐structure. This has, thus, resulted in different cultures defined as “competitive” and “collaborative” respectively, which comprises contrasting values. However, the fragmented culture has proven to be a necessary implication of a fragmented organization with a diverse workforce. My findings indicate that the lack of cohesion in the organization is a result of culture being uncontrollable and in that culture is not something the organization “owns” but rather something the organization “is”. Efforts of changing culture have been unsuccessful, however, my findings show that the Code of Conduct has been successfully implemented with the result of achieving more openness and respect for diversity in the organization and the compliance level increased. Even though the Code of Conduct has successfully been implemented, there is still a lack of cohesion in the organization and efforts of changing this is not worthwhile due to (1) culture cannot be managed and (2) cohesiveness is not necessarily

desirable. Cohesiveness makes an organization vulnerable to “group think” and even though lack of cohesiveness has shown to create more conflicts between people, conflicts should not always be seen as a negative thing in organizations. Conflicts can lead to improved creative problem‐solving and decision‐making, because the diversity of perspectives generates more alternatives and greater critical evaluation.

Recommendations The recommendation for Novo A/S is then not to strive for a cohesive culture, but to accept and acknowledge that lack of cohesion is a result of a necessary fragmented work‐structure and diverse workforce. The goal should rather be to foster respectful behavior (through for example a Code of Conduct) of the organizational members and acknowledging each other’s differences and thereby create value from the diversity of the organization.

1 ‐ Introduction The impact of culture on organizations is a widely debated theme in organizational theory. Most scholars agree that “organizational culture” refers to the set of values, beliefs, and behavior patterns that form the core identity of an organization. A “strong1” culture that encourages the participation and involvement of an organization’s members appears to be seen as one of organizations’ most important assets. Due to the complex nature of the culture concept, just defining an organization’s culture can be tricky let alone trying to change it. Scholars have researched and written about organizational culture since the 1980s, however, involving the practitioners has proven more difficult. It could be because managers are unsure about what the word means in a business context and what use they could make of a better understanding of their own organization’s culture. Managing international businesses means handling both national and organizational culture differences at the same time. Organizational cultures are somewhat manageable, according to some scholars (e.g. Schein, 1985), while national cultures are given facts for management; common organizational cultures across borders are what keep multinationals together (Hofstede, 1994:1). What spurred this research project was the realization of the close relation between an organization’s culture and its people. Business scholars have, nowadays, shifted their attention towards the “softer” aspects of business administration and some have come to the conclusion that human, not financial, capital must be the starting point and ongoing foundation of a successful strategy (Bartlett & Ghoshal, 1991). I have chosen to do some research on a company whose goal is to obtain a cohesive culture. The scope of the project has been determined in cooperation with Dorte Barlebo Madsen (HR Manager of Novo A/S). Novo A/S is a perfect “case study” for my thesis, as I know the company very well. I have been so privileged to work at Novo A/S from November 2006 to August 2009. As a student assistant, I worked in different departments including bookkeeping, general administration, and primarily in human relations. Working with human relations has taught me much about the people in Novo A/S, and I have been working with the entire recruitment process as well as leading the recruitment of a bookkeeper. Furthermore, I 1 A definition of a strong culture will be presented in the literature review.

was so fortunate to go on a teambuilding trip with my fellow colleagues in Greenland in March 2009. All of this experience has leaded me to a lot of observations of ‐ and participation in ‐ the culture of Novo A/S. It has also given me a great knowledge of the people in Novo A/S, which has, in turn, benefitted me when conducting semi‐structured interviews and questionnaires because a great level of trust has already been built. Considering Novo A/S, the holding company in the Novo Group, allows for a thorough investigation of the significance of organizational culture in a specific organization. Novo A/S will be the chosen case study of this research project, where I will build research upon a previous cultural analysis, which was conducted in May of 2008 by Facilitators2. The culture analysis concluded that the culture was lacking cohesiveness due to a cultural gap between two diverse3 groups of employees. The acknowledgement of the cultural gap has resulted in efforts from both management and employees to try to achieve a more cohesive culture. The method used to enforce a cohesive culture was especially by implementing a Code of Conduct ‐ as a means of managing the diversity of employees. Now, two years later, I find it intriguing to investigate whether the Code of Conduct has enforced a cohesive culture or not. The initial conclusion of the cultural analysis in 2008 was that the organizational culture was divided into two groups of people: the “office‐based” employees and the “out‐in‐the‐field” professionals. The latter group was content with the current culture, however the former would prefer to have a more collaborative4 culture, which they believe would result in a more cohesive Novo A/S. Hence, the research question sought answered in this thesis is the following: Can a cohesive organizational culture be obtained through a Code of Conduct, and if so, why? – A case study of Novo A/S. The research issue will be investigated with two different perspectives of organizational culture. The first view is called the “Integration Perspective” of culture, which assumes that a cohesive culture is characterized by consistency, organization‐wide consensus, and clarity (Martin, 2004: 4). The second view of culture is called the “Fragmentation Perspective”, which 2 Facilitation is defined as: an investigation aiming at discovering whether the individual departments in Novo are living up to the Novo Charter. 3 A definition of ”diverse” will be presented in the literature review. 4 An explanation of ”collaborative culture” will be presented in the literature review.

assumes that claims of clarity, consistency, and consensus are idealized oversimplifications that fail to capture the confusing complexity of contemporary organizational functioning (Martin, 2004: 10). Novo A/S’s efforts of changing culture through the implementation of a Code of Conduct will form the basis of the analysis and the emphasis will be on whether a cohesive culture is, in fact, obtainable for the organization considering the fragmented organizational work‐structure and diversity of the people. The methods used for the analyses, consists of a measurement of Novo’s compliance level to the Code of Conduct, an organization‐ wide questionnaire, and semi‐structured interviews. Furthermore, a discussion of cultural cohesiveness, its definition and implication, will lead to a conclusion to the research question sought answered. I will test my theory with the following hypothesis: A cohesive organizational culture is generally not feasible in an organization with structural fragmentation and diverse people. The purpose of this project is both to produce a final product of the three‐year education in Business, Language and Culture and also to consult Novo A/S in the problematic organizational issue.

2 ‐ Literature Review and Theoretical Framework 2.1 Organizational Culture: An Overview

The purpose of this literature review is to give an overview of what is written about the concept of organizational culture. Various authors and ideas will be presented and put into context with my research question. First, I shall discuss the concept of organizational culture, its definition and why it is interesting to learn something about it. Thereafter, I will look at the conflicting perceptions of culture by which I will contrast the view of Edgar Schein with the view of Joanne Martin. Furthermore, various perceptions of Managers’ role in organizational culture will be presented, as there is disagreement in cultural studies about whether culture is something that can be managed. I will also look at the concept of a Code of Conduct as a means to managing diversity. At last, the conceptual model “Competing Values Framework”, which Novo A/S has used for the culture analysis will be described. 2.2 A Cultural Unit “There cannot be a culture unless there is a group that ”owns” it. Culture is embedded in groups hence the creating group must always be clearly identified. If we want to define a cultural unit, therefore, we must be able to locate a group that is independently defined as the creator, host, or owner of that culture” (Schein, 1987: 266). In contrast, Smircich (1983) believes that organizations or groups do not “own” a culture; they are their culture. Similarly, Meyerson & Martin (1987) state, “we take the position that organizations are cultures. That is, we will treat culture as a metaphor of organization. We view organizations as patterns of meanings, values, and behavior (Meyerson & Martin, 1987: 321). Schein (1987) defines a group as “a set of people (1) who have been together long enough to have shared significant problems, (2) who have had opportunities to solve those problems and to observe the effects of their solutions, and (3) who have taken in new members. A group’s culture cannot be determined unless there is such a definable set of people with a shared history” (Schein, 1987: 266).

2.3 Culture Defined Few concepts in organizational theory have as many different and competing definitions as “organizational culture”. Schein (1985) defines culture as social or normative glue that holds an organization together. From an anthropologist point of view, Clyde Kluckhohn has defined culture as “ the set of habitual and traditional ways of thinking, feeling and reacting that are characteristic of the ways a particular society meets its problems at a particular point in time.” A corporation’s culture, similarly, is reflected in the attitudes and values, the management style, and the problem‐solving behavior of its people (Schwartz & Davis, 1981: 32). The concept of culture has been central to anthropology and folklore for over a century. Although organizational culture studies began to appear around the early 1970s, it was not until the 1980s that management scholars widely adopted the culture concept (Hatch, 1993:1). In this regard, Schein was especially influential because he, more than anthropologists and folklorists, articulated a conceptual framework for analyzing and intervening in the culture of organizations (Hatch, 1993:1). With Schein’s definition of organizational culture, one can come to understand the dynamic evolutionary forces that govern a culture, and also explain how the culture is learned, passed on, and changed. His definition of culture is: “a pattern of basic assumptions – invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration – that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems” (Schein, 1985:9). Schein puts emphasis on the history the group or organization shares and the way they have “survived” problems such as external adaptation and internal integration. Schein believes that culture can be changed and that culture is, in fact, manageable, which will be addressed later in this literature review. In order to really understand the concept of culture, it is appropriate to establish what culture is not. According to Schein (1985) organizational culture as a concept has been misunderstood and confused with other concepts, such as climate, philosophy, ideology, style, how people are managed, and the like. Culture is often being confused with climate. Many large corporations undertake climate surveys to “take the temperature” of their organizations. However, “climate is a measure of whether people’s expectations about what it should be like to work in an organization are being met” (Schwartz & Davis, 1981: 33). While climate is often

transitory, tactical, and managerial over the relatively short term, culture is usually long‐term and strategic (Schwartz & Davis, 1981: 33). Schein (1985) recognizes that culture is complex and difficult to understand, but the effort to understanding it is worthwhile because of the mysterious and the irrational in organizations suddenly becomes clear when we do understand it (Schein, 1985:5). Culture is also very pervasive and some might interpret the pervasiveness of culture as it being irrelevant. Schein argues, that this pervasiveness is no more irrelevant as for humans to understand how gravity and the atmosphere work. “It is precisely the pervasiveness that makes it easy to ignore, however, in that it is hard to get a handle on something that is pervasive. But failing to understand how culture works is just as dangerous in the organizational world as failing to understand gravity and the atmosphere is in the physical world” (Schein, 1985:48). The “strength” of culture can be defined, according to Schein (1987), in terms of (1) the homogeneity and stability of group membership, and (2) the length and intensity of shared experiences of the group. “If a stable group has had a long, varied, intense history, it will have a strong and highly differentiated culture. By the same token, if a group has had a constantly shifting membership or has been together only for a short time and has not faced difficult issues, it will, by definition, have a weak culture” (Schein, 1987:266). 2.4 The Integration and Fragmentation Perspectives of Culture Integration studies of culture implicitly or explicitly assume that a culture is characterized by consistency, organization‐wide consensus, and clarity (Martin, 2004: 4). Because of the human nature of people, these characteristics of culture are desirable in the sense that people strive after organizational harmony, which will be formed when there is a shared set of values, which are clearly stated by leaders so that the individual knows what to do and how to do it (Schein, 1985). Consistency occurs because people at higher levels of an organization articulate a set of espoused values, sometimes in the form of a mission statement; these values are then reinforced by a variety of cultural manifestations that generate organization‐wide value consensus. Organizational members know what they are to do, and they agree why it is worthwhile to do it (Martin, 2004: 4). Because of the promise of clarity and organizational harmony, according to integration views, culture offers the key to managerial control, worker

commitment, and organizational effectiveness (e.g. Deal and Kennedy, 1982; Ouchi, 1981) (Meyerson & Martin, 1987: 323). From the Integration view, culture is often defined as that which is shared by and/or unique to a given organization or group (e.g. Schein, 1985). Culture, according to this definition, is an integrating mechanism (Schein, 1985), the social or normative glue that holds together a potentially diverse group of organizational members. Given this definition of culture, researchers use “shared” as a code‐breaker for identifying relevant manifestations of a culture, seeking, for example, a common language, shared values, or an agreed‐upon set of appropriate behaviors (Meyerson & Martin, 1987: 323). As a final defining feature, integration views of culture deny ambiguity (by ambiguity is meant that which is unclear, inexplicable, and perhaps capable of two or more meanings (Meyerson & Martin, 1987; Webster, 1985)). Such portrayals recognize only those cultural manifestations and values that are shared, culture becomes that which is clear (Meyerson & Martin, 1987: 323). The denial of ambiguity, in this view, stands in contrast to the Fragmentation perspective of culture advocated by scholar Joanne Martin. “Rather than banning ambiguity from the cultural stage, Fragmentation studies see ambiguity as the defining feature of cultures in organizations” (Martin. 2004:10). Martin sees the concept of culture highly contradicting: “Organizational cultures are resistant to change, incrementally, adaptive, and continually in flux” (Meyerson & Martin, 1987: 321). The contradictions of culture show the ambiguity of the concept. “Ambiguity is an internal state that may feel like confusion: individuals become confused when information that is expected is absent. This type of ambiguity is resolved when and if information becomes available. When individuals simultaneously embrace two or more irreconcilable meanings, they experience ambiguity” (Meyerson & Martin, 1987: 323). As stated in the introduction, in Fragmentation studies of culture, claims of clarity, consistency, and consensus are shown to be idealized oversimplifications that fail to capture the confusing complexity of contemporary organizational functioning (Martin, 2004: 10). In Fragmentation studies, power is diffused broadly at all levels of the hierarchy and throughout the organization’s environment. “Change is a constant flux, rather than an intermittent interruption in otherwise stable state” (Martin, 2004: 12), which eliminate the sense of harmony and, thus, cohesiveness (defined later in this review).

Martin (2004) argues that there are many plausible interpretations of any issue or event in organizations, making the idea of a single clear, shared cultural reality highly unlikely. From the Fragmentation perspective, culture looks less like a monolith (as is the case from the Integration perspective), and less like a collection of sub‐cultural islands (a Differentiation5 perspective), and more like a room full of spider webs, constantly being destroyed and rewoven (Martin, 2004: 11). Martin presents the three different paradigms for viewing organizational culture: “Contrasting the Paradigms” Integration Degree of Consistency consistency among cultural manifestation

Degree of consensus among members of culture Reaction to ambiguity Metaphor for paradigm

Differentiation Fragmentation Inconsistency and Lack of clarity consistency (neither clearly consistent nor clearly inconsistent), and irreconcilable inconsistencies Organization‐wide Within, not Issue‐specific between, consensus, subcultures dissensus, and confusion among individuals Denial Channeling Acceptance Monolith

Sea of islands

Spider webs

Source: (Meyerson & Martin, 1987: 331)

This table illustrates the contrast between the views discussed in this thesis. 2.5 Managers’ Role in Organizational Culture Whether managers have a major (or any) role in influencing and maintaining organizational culture is a question various scholars disagree on. According to Schwartz and Davis (1981) the best answer to the question: “How should we organize to pursue a particular strategy?” is that it depends on a complex set of trade‐offs among structure, systems, people, and culture. No 5 Differentiation studies describe organizations as composed of overlapping, nested subcultures that coexist in relationships of intergroup harmony, conflict, or indifference (Martin, 2004: 7)

organization will perform well in a competitive environment unless these four dimensions of organization are internally consistent and fit the strategy. While a great deal is known about managing the first three dimensions – structure, systems, and people – there is little more than an intuitive sense about how to manage the fourth dimension of organizations – culture (Schwartz & Davis, 1981:32). Furthermore, they argue that, “the mundane routines buried deep in companies’ cultures (and subcultures) may be the most accurate reflections of why things work the way they do, and why some firms succeed with their strategies where others fail” (Schwartz & Davis, 1981:31). “Managing culture is, for many managers, a difficult task. Nevertheless, to run a successful business, it is argued that managing culture is crucial. Structure, systems, people, and culture determine important managerial behavior. They influence the way in which major management tasks are carried out and critical management relationships formed” (Schwartz & Davis, 1981:36). According to Schein (1985), culture is managed top‐down, where employees observe the behavior of the manager (symbolic leadership). Schein (1985) focused attention on individual corporate leaders who attempt to generate company‐wide consensus regarding their personal values and corporate goals through a wide range of consistent corporate policies and practices. Using a similar functionalist approach, Collinson and Poras (2002) assume an Integration view of culture and argue that “strong” cultures are key to firm profitability (Martin, 2004:5). Martin (2004) argues that integration studies of culture offer managers and researchers a seductive promise of harmony and value homogeneity that is empirically unmerited and unlikely to be fulfilled (Martin, 2004:7). The Fragmented view of culture denies managers’ ability to control culture due to ambiguity. As stated earlier, change is a constant flux, rather than an intermittent interruption in an otherwise stable state (Martin, 2004:12). 2.6 Code of Conduct: A Means to Managing Diversity The growing diversity of the workforce in Novo A/S has resulted in a somewhat heterogeneous organization. “The term “diversity” encompasses a range of differences in ethnicity/nationality, gender, function, ability, language, religion, lifestyle or tenure. Additionally, diversity in the workplace includes more than employees diverse demographic backgrounds, and takes in difference in culture and intellectual capability” (Basset‐Jones,

2005:169). According to Basset‐Jones (2005), theorists have shown that heterogeneous groups experience more conflict, higher turnover, less social integration and more problems with communication than their homogeneous counterparts. However, diversity combined with an understanding of individual strengths and weaknesses, and working relationships that are founded upon sensitivity and trust, have been shown to enhance creativity and problem‐solving capabilities (Basset‐Jones, 2005; Hennessey & Amabile, 1998). One of the ways of creating working relationships founded upon sensitivity and trust is by an agreed‐ upon set of appropriate behaviors also known as a Code of Conduct. “Top management has the responsibility for establishing standards of behavior and for effectively communicating those standards to all managers and employees in the organization. One of the traditional ways by which companies have fulfilled this responsibility is through the use of codes of conducts” (Buchholtz & Carroll, 2009: 330). Kaptein and Schwartz (2008) has defined business codes as: “a distinct and formal document containing a set of prescriptions developed by and for a company to guide present and future behavior on multiple issues of at least its managers and employees toward one another, the company, external stakeholders and/or society in general” (Kaptein & Schwartz, 2008:3). The case for diversity in organizations is arguably; “that diversity leads to lower levels of risk aversion and better decision‐making and problem‐solving capability. This arises because diversity promotes a more robust critical evaluation of the first solution to receive substantial support” (Basset‐Jones, 2005:172). According to Basset‐Jones (2005), one of the objections to diversity is that it damages cohesiveness. Cohesiveness, however, makes groups vulnerable to “group think6”. Diversity acts as an impediment to this phenomenon. Conflict is perceived to damage cohesiveness; however, when it is effectively channeled, it can lead to improved creative problem‐solving and decision‐making, because the diversity of perspectives generates more alternatives and greater critical evaluation (Basset‐Jones, 2005:172). A definition of cohesiveness is appropriate given the scope of this project. Group cohesiveness is the force bringing group members closer together. Cohesiveness has two dimensions: emotional (or personal) and task‐related. The emotional aspect of cohesiveness is derived from the connection that members feel to other group members and to their group as a whole 6 As defined by Janis (1972) “A mode of thinking that people engage in when they are deeply involved in a cohesive in‐group, when the members' strivings for unanimity override their motivation to realistically appraise alternative courses of action”.

(Beal et al., 2003). Task‐cohesiveness refers to the degree to which group members share group goals and work together to meet these goals. That is, is there a feeling that the group works smoothly as one unit or do different people pull in different directions? (Beal et al., 2003). The more group members are similar to each other on various characteristics, the easier it would be to reach cohesiveness. “Following Social Identity Theory, we know that people feel closer to those whom they perceive as similar to themselves in terms of external characteristics (age, ethnicity) or internal ones (values, attitudes). In addition, similar background makes it more likely that members share similar views on various issues, including group objectives, how to communicate and the type of desired leadership” (Beal et al., 2003). In general, higher agreement among members on group rules and norms results in greater trust and less dysfunctional conflict. This, in turn, strengthens both emotional and task cohesiveness (Beal et al, 2003). I argue that the Integration view of culture is what constitutes a cohesive culture. People’s similarity and, thus, organizational homogeneity strengthens cohesiveness. This project’s definition of a cohesive culture is then: organizational harmony, which is based on clearly defined values, which are shared by the whole organization. 2.7 A Conceptual Model of Analyzing Culture Although arguments against conceptual models of organizational culture have been made on the grounds that they oversimplify complex phenomenon, such models serve an important role in guiding empirical research and generating theory (Schultz & Hatch, 1996: 537). The method used for the culture analysis in 2008 is a Danish version of the Competing Values Framework developed at the University of Michigan by Kim S. Cameron and Robert E. Quinn7. The method is validated and tested on more than 1,000 organizations globally. It has proven useful, first, to describe existing cultures, and to be a good foundation for change. The model is structured around two axes, the y‐axis ranges from flexibility and dynamism to stability and order, and the x‐axis ranges from external to internal focus. These two dimensions form four quadrants, each of which describes the characteristic elements of an organization's culture. It 7 The information about the ”Competing Values Framework” is provided by Novo A/S.

is interesting that the elements represent opposing, competing values. Individually, they can be extremely effective, and they are always combined in one organization.

Flexible

Creative

Collaborate

Internal

External

Control

Compete

Stabil

The method analyzes the organizational culture in six different dimensions, each dimension resulting from a balance of the four main types of culture. The six dimensions are: 1. Basic characteristics 2. Management 3. Personnel Management 4. What keeps the organization together? 5. Strategic focus for the organization 6. Critical success factors in the organization. The measurement consists of a survey where all employees are asked to allocate a total of 100 points on four statements, based on the degree to which the statement applies to the organization. From this, the “type” of the culture is found and also the preferred culture is found. Every culture has elements from these four “archetypes”. The one type, which scores highest, however, is the dominating feature of the culture.

Collaborate Focus: Values Situation: a community united by shared beliefs, competency is closely linked to unique abilities, strong identification with lifestyle Purposes: community and knowledge Practices: building teams and developing communities, training, and coaching, creating shared vision and values. Harmonious work environment People: Build trust, helpful, resolves conflict, empowering, good listener, encourages participation Environment: harmonious atmosphere, collaborative workplace, informal communication, shared values Measures: employee satisfaction, employee turnover, training per employee, competency peer review Control Focus: Process Situation: Organization has large and complex scope and scale, government regulations and standards determine business practices, failure is not an option Purpose: Efficiency and quality Practices: implementing large scale technology and systems, applying continuous improvement processes, complying with regulations, adhering to standards People: organized, methodical, technical, practical, objective, persistent Measures: Budget adherence, milestones achieved, number of failures, regulatory compliance

Creative Focus: vision Situation: differentiation creates significantly higher margins, a new Methodology changes the game, an industry is situated around blockbuster invention Purposes: Innovation and growth Practices: Encouraging radical thinking, launching new ventures, speculating emerging opportunities, launching change initiates, destroying the old way of doing things People: Visionary, optimistic, generalist, enthusiastic, quick thinker, expressive Environment: stimulating projects, flexible hours, free from everyday constraints, diverse workforce Measures: diversity of experiments, new market growth, adoption rate, revenues from new products and services Compete Focus: Goals Situation: shareholder demands are the primary driver, aggressive competition, markets change from mergers and acquisitions, investors demand quick results Purposes: profits and speed Practices: Managing performance through objectives, investing for increasing rates of return, quickly starting and killing initiatives, quickly confronting problems People: Goal oriented, assertive, driven, accountable, decisive, competitive Environment: High pressure, fast moving, quantifiable results, pay for performance Measures: Gross Profit, time to market, return on investment, operating income

Source: www.competingvalues.com

One can discuss whether these four “competing values” really says a lot about culture. However the generalization and simplification of the method has been rather helpful for organizations to get a grasp of the rather complex and pervasive concept culture really is. The results of the analysis is presented and discussed in the analysis part of this thesis.

3 ‐ Methodology and Project Framework The purpose of the following chapter is to provide a guide of how to read and understand this project.

3.1 Project Structure

Management Report

Introduction and Research Question Literature Review and Theoretical Framework Project Framework and Methodolody

Analysis

Discussion

Main Conclusion

3.2 Methodology The analysis conducted and the conclusions arrived at, all build on fundamentally interpretive and functionalist research philosophies. The interplay of paradigms both interpretivism and functionalism gives me a better understanding of the diversity of organization theory. Paradigms are sets of ontological and epistemological assumptions and I will use these two paradigms because functionalism (Schein) has been the dominant paradigm within

organization theory and interpretivism (Martin) offers the greatest contrast to functionalism’s assumptions (Schultz & Hatch, 1996: 531). The research strategy of this project is a case study defined as: “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” (Saunders et al, 2007: 139). The case study strategy will be carried out using and triangulating multiple sources of data. “Triangulation refers to the use of different data collection techniques within one study in order to ensure that the data are telling you what you think they are telling you” (Saunders et al, 2007: 139). I will collect qualitative data by two semi‐structured interviews, which will triangulate quantitative data collected by a questionnaire of employees. The project’s qualitative research is a “situated activity that locates the observer in the world. It consists of a set of interpretive, material practices that make the world visible. These practices transform the world. They turn the world into a series of representations, including field notes, interviews, conversations, photographs, recordings, and memos to the self. At this level, qualitative research involves an interpretive, naturalistic approach to the world. This means that qualitative researchers study things in their natural settings, attempting to make sense of, or interpret, phenomenon in terms of the meanings people bring to them” (Denzin & Lincoln, 2000:3). In this project the qualitative research involves the studied use and collection of a variety of empirical materials – case study; observation; personal experience; interview; cultural texts and productions; – that describe routine and problematic moments and meanings in individuals’ lives (Denzin & Lincoln, 2000:3). According to Denzin and Lincoln (2000), qualitative researchers stress the socially constructed nature of reality, the intimate relationship between the researcher and what is studied, and the situational constraints that shape inquiry. Such researchers emphasize the value‐laden nature of inquiry. They seek answers to questions that stress how social experience is created and given meaning. In contrast, quantitative studies emphasize the measurement an analysis of causal relationships between variables, not processes. Proponents of such studies claim that their work is done from within value‐free framework (Denzin & Lincoln, 2000:10). This project’s analyses will consist of (1) interpreting the former culture analysis (2008), which will lead me to an understanding of the cultural strategy and goal. (2) An analysis of the

current compliance level of the Code of Conduct, which will be done by a quantitative measurement of the organization’s members. They are asked to score each rule in the Code of Conduct according to the compliance level with a score range of 1 to 10. I will thereafter compare the average scores with the ones from 2008 when the Code of Conduct was implemented. This will be done to see if the implementation of the Code of Conduct has been successful in regards to the compliance level of the rules. (3) An Organization‐wide questionnaire will offer me answers to the questions sought answered in this thesis. I have asked the members of Novo A/s to define themselves either as an “office‐based” employee or an “out‐in‐the‐field” employee to categorize the answers and compare the result with each other. I have done this because the former culture analysis (2008) showed that there were two diverse groups in Novo A/S with different views on the organization’s culture. The questionnaire also gives the employees an opportunity to characterize the “office‐based” and the “out‐in‐the‐field” employees so a clearer picture of each group can be found. In order to answer my research question about whether Novo A/S can achieve a cohesive culture, I must analyze the culture’s cohesion. This will be done through qualitative research. I have conducted semi‐structured interviews with one “office‐based” manager and one “out‐in‐the‐ field” manager, which gave me the ability to collect answers to the same questions from each of the groups. The interviewees were asked about their perception of the harmony, organization‐wide consensus, and clarity of the culture and, furthermore, asked about whether they believe cohesiveness is desirable for Novo A/S and why. The methodology used for the facilitation in 2008 included a desk‐study based on business and organizational documents received from Novo A/S; Management provided a self‐ assessment as Novo Way of Management as input to compliance levels. Additionally, a culture survey was conducted with all employees. Furthermore, all employees who participated in the facilitation interviews provided additional input to the culture and the motivational drivers for staying in Novo A/S. All elements were then used to describe, analyze and conclude on key issues (Facilitation Report, 2008). I will, furthermore, test my theory with the hypothesis stated in the introduction, which is “A cohesive organizational culture is generally not feasible in organizations with structural fragmentation and diverse people”. I will apply theories of culture change and diversity to my empirical findings to discuss the implications a fragmented organization with diverse people

have on organizational culture. I will furthermore discuss the term cohesiveness of organizations to determine whether Novo A/S’s goal of obtaining a cohesive culture is worthwhile and thereby discuss if cohesiveness is at all desirable. The first part of this thesis takes an exploratory approach, as I will explore the issues Novo A/S has with organizational culture and the rise of their conflicts. Secondly, I am taking a descriptive approach to portray an accurate profile of the people, events, and situations in Novo A/S. Thirdly; my discussion will take an explanatory approach by which I will try to explain the implications of their fragmented organization and diverse people in relation to culture. To give a clearer picture of my role as a researcher, I have made a table to illustrate which part of the culture analysis Novo A/S has done previously and which part I have done as a follow‐up of their culture analysis. Deline current culture

May 2008

Done by Novo A/S Deline preferred culture

May 2008

Done by Novo A/S Code of Conduct implementation

May 2008

Done by Novo A/S

Analysis of Code of Conduct and cultural cohesion

May 2010

Done by Maria Carlsen

3.3 Project Relevance The research question seeks to answer a query that is central to the whole of the organization and is interdisciplinary. Besides being a form of consultancy job for Novo A/S, the project reports an international management problem within the thematic framework of “organizations, strategy and internationalization” which is consistent with the formal requirements of the project. Moreover, the project incorporates different fields of business

administration, which include organization, diversity of workforce and culture. The research question fulfills the requirements by being a concrete and practical problem that guides my empirical investigations and allows for an interdisciplinary approach. The required international angle, I argue, is implicit as I am dealing with a highly international company that employs many foreign citizens as well as they are doing business investments primarily in other countries (see chapter: Novo in Brief). In the last chapter, Further Perspectives, a look upon internationalizing people and culture will be presented. To achieve a holistic and interdisciplinary research approach, I draw on the knowledge attained from Business Strategies & Stakeholder impact (BUSI), Communication & Organization (ComOrg) as well as the courses I took on exchange at the State University of New York in the fall of 2009. These courses are: Human Resource Management and Business Ethics. By having a wide array of ballast, the end result is believed to be comprehensive, well founded, and highly relevant to the fulfillment of this project’s underlying objectives.

3.4 Limitations This project has been time‐consuming and difficult due to the amount of research needed to construct the project. This project has arguably been limited by these factors due to lack of time in the curriculum to do the project. I have chosen to do the project alone, which also have been a difficult task, however, I am confident that the final product is consistent with the project’s formal requirements as well as fulfilling the underlying objectives. There has, in addition, been the great amount of empirical material needed to get a grasp of the issues studied. However, I argue that the past experience, which I have had in Novo A/S, has benefitted me in the sense that the organization has been very helpful and interested in the project. I have, thus, been able to collect empirical data from interviews and questionnaires to a large amount considering the busy lives of the people in Novo A/S. During the last part of the project, the organization was busy moving office location to another end of Copenhagen. This has resulted in less questionnaire participants than hoped for ‐ also because of the shut‐down of the office for nearly a week. All in all 17 members, out of 30, participated in the questionnaire – which according to the Managers is quite good given the busyness of everyone involved. Fortunately, the 17 participants represent the entire organization very

well (with regards to the organization) so I strongly believe that the data presented are solid empirical findings. Another limitation is the use of only two perspectives of culture rather than Joanne Martin’s recommended three perspectives: Integration, Differentiation, and Fragmentation. The Integration view of culture is what the analysis will be based on as it matches Novo A/S’s perception of culture. The Fragmentation view will act as a critique of the Integration view and will be the base on which I will test my theory through the hypothesis stated in the introduction. I will not go into details with the Differentiation view because the two chosen views are the most contrasting views and, hence, I will limit myself to focus on them. 3.4.1 Critical Appraisal of Primary Data The primary data consists of interviews with two managers as well as a questionnaire of employees. It is important to note that the primary data will be analyzed within my interpretive framework, that is, “the qualitative researcher is bound within a net of epistemological and ontological premises which – regardless of ultimate truth or falsity – become partially self‐validating” (Denzin & Lincoln, 2000: 22; Bateson, 1972). Furthermore, the gendered, multiculturally situated researcher approaches the world with a set of ideas, a framework (theory, ontology) that specified a set of questions (epistemology) that he or she then examines in specific ways (methodology, analysis). That is, the researcher collects empirical materials bearing on the questions and then analyzes and writes about those materials. Every researcher speaks from within a distinct interpretive community that configures, in its special way, the multicultural, gendered components of the research (Denzin & Lincoln, 2000:21). Hence, the empirical findings of this thesis are analyzed and interpreted with my gendered and cultural point of view and, thus, the conclusions drawn can be argued to be self‐validated and influenced by my, as the researcher, past experiences in Novo A/S as an observer as well as a participant in the culture studied. 3.4.2 Critical Appraisal of Secondary Data The secondary data, which I have chosen to apply to my research, includes Novo A/S’s Annual Report, the Organizational Review, Charter and their Code of Conduct. As I am conducting an internal investigation of their culture, I find this data very useful as it gives me a sense of their

goals, values and missions. To really understand their culture, it is important for me to know which guidelines, values and the like, they work by. Other secondary literature is mainly research papers or books from organizational theory scholars. As stated earlier, few concepts like organizational culture has as many competing definitions, and the concept is, thus, a very issue‐specific, complex, and contradicting phenomenon. So while many papers about the subject have been read through, I have been forced to limit myself to a few of them and focus my attention of the two contradicting views of organizational culture. I have found the secondary literature primarily through the search‐site Google Scholar, which have proven very useful to gain an overview of the existing literature on the subject.

4 ‐ Novo A/S in Brief Novo A/S is a Danish private limited liability company fully owned by the Novo Nordisk Foundation, and the holding company of the Novo Group who is the majority shareholder in the publicly listed companies Novo Nordisk A/S and Novozymes A/S (Novo A/S, Annual Report 2009). Novo A/S was established in 1999 prior to the demerger of Novo Nordisk A/S, where Novozymes A/S was established as a stand‐alone publicly listed company. Novo’s purpose and objectives are to manage the Foundation’s financial assets and to ensure the Foundation sufficient dividends to cover its grant obligations for medical and scientific research in Scandinavia (Novo A/S, Annual Report 2009).

In the management report of 2009, it is stated that: “In 2009 Novo A/S accelerated its commitment in the life science area through the establishment of a Growth Equity department focusing on investments in companies that are more mature and typically larger than venture companies. Within ventures new investments were made in two companies in the US and follow‐on investments in 25 companies in the existing portfolio. Furthermore, Novo together with the Novo Nordisk Foundation has provided funding for two “pre‐sees” projects and invested in two new “seed” projects. Novo’s position as an international investor within life

science has, thus, been strengthened. The value of the life science investments at the end of 2009; totaled DKK 2.2 billion (Novo A/S, Annual Report 2009).

Novo’s organization consists of 5 departments: Management, Novo Ventures, Novo Seeds, Novo Growth Equity, and Novo Finance. In spite of the financial crisis starting in 2007, Novo has been able to expand their business in regards to the development of the new department, Novo Growth Equity, and also by employing new people in the remaining departments. As the business potential for Novo A/S is mostly located geographically in the US, Novo A/S is dealing with internationalization of systems and people. “The rationale for the main scenario is that we believe the dominating role of USA in the life science industry will not be weakened – on the contrary the present trend is that the biotech and pharma business will be strengthened in USA at the expense of EU” (Novo Organizational Review 2009). The organizational review (2009) furthermore reports on Novo A/S strengths, weaknesses. “Good international companies (and co‐investors) see Novo A/S as an attractive investor because they believe we can support them in their product and business development. Novo Ventures Team can assist the portfolio companies in the following areas of expertise: •

Drug discovery strategies and pre‐clinical development

•

Clinical development – advice regarding design of trials, finding best Contract Research organizations and collaborators

•

Manufacturing and regulatory advice especially of biologics

•

Patent, licensing and competitor analysis and strategy

•

Establish network to the pharma‐, biotech‐ and financial community

•

Defining financing strategies and approach to investors

•

Take initiatives regarding collaborations, partnerships, M&A and other exits.

•

Identify management team and other key people

•

Executive management and work in Board of directors

The competencies of the Novo Ventures team match these requirements very well qualitatively – however we have been faced with an increasing resource constraint especially in the US. Based on this we decided to establish a US Office in San Francisco” (Novo Organizational Review 2009). Because of the continued strong effort in the US, which led to the development of an office in California and employment of the global workforce, Novo A/S sees one of their strongest organizational challenges as: “Building organization in the US in a fashion that we keep our strong culture and work as one team” (Novo Organizational Review 2009). The office in California and increasing business potential there has led to expatriations of two partners in the US and one in Denmark. In addition, visits of short and medium duration (1‐3 months), common off‐site meetings and a weekly teleconference for the whole team, has resulted in a very smooth development of the organization (Novo Organizational Review 2009).

5 ‐ Analysis In this chapter my empirical findings from my analyses will be presented. The findings will be discussed in the chapter that follows this, which will lead me to my main conclusions.

5.1 The Novo Group: One Culture? From a broad perspective, do the companies in the Novo Group have a common culture? Novo A/S shares a set of values, commitments, and fundamentals with the other companies in the Novo Group described in a charter (a business code). The values are (Charter for the companies in the Novo Group): •

Accountable – each of us shall be accountable – to the company, us and society – for the quality of our efforts, for contributing to our goals and for developing our culture and shared values.

•

Ambitious – we shall set the highest standard in everything we do and reach challenging goals.

•

Responsible – we shall conduct our business in a socially and environmentally responsible way and contribute to the enrichment of the communities in which we operate.

•

Engaged with stakeholders – we shall seek an active dialogue with our stakeholders to help us develop and strengthen our business.

•

Open and honest – our business practices shall be open and honest to protect the integrity of the Novo Group companies and of each employee.

•

Ready for change – we must foresee change and use it to our advantage. Innovation is key to our business and therefore we will encourage a learning culture for the continuous development and improved employability of our people.

The values imply that the companies in the Novo Group have a shared culture. From an external perspective, the Group may be regarded as having a strong corporate culture, however, that perception is somewhat misguiding. In this case, I believe that culture is confused with “identity” as these values say more about corporate identity and the corporate brand, than it does about organizational culture. Culture is not simply a shared set of values as we have established in the literature review; shared beliefs and behaviors are also factors to

consider when defining culture. These values created from the highest rank in the Novo Group are more of a moral compass for the employees than anything else. According to Schein: “if a total corporation consists of stable functional, divisional, geographic, or rank‐based subgroups, then that corporation will have multiple cultures within it” (Schein, 1987: 267). The Novo Group has hundreds of such divisional, geographic, and rank‐based subgroups, hence, to say that there exists a shared culture is not entirely accurate. However, to say that the Group has a shared strong identity and brand is more accurate as this is created by other factors. The whole of the Novo Group has a strong identity (by reputation and the like) in Denmark and increasingly throughout the world, as Novo Nordisk is the leading pharmaceutical company regarding treatment of diabetes. However, Novo A/S is a small organization with very little in common (business and organization‐wise) with the large companies such as Novo Nordisk and Novozymes. Novo A/S has shown ambivalence as to the extent they wish to be associated in close relation to Novo Nordisk. According to Søren Carlsen (Managing Partner), “we are sharing a lot of the basic characteristics with the companies in the Novo Group, however, we wish to differentiate ourselves from Novo Nordisk, not because we disagree with their values but because we wish to be unique and anti‐bureaucratic. This attracts many young people in particular” (appendix 2, Q. 6). Hence, Novo A/S’s strategy is actually to differentiate themselves from the large companies in the Group so that they can be regarded as “individuals” with their own opinions and way of doing things rather than being “controlled” by a “parent” culture.

5.2 Organizational Culture in Novo A/S Novo A/S decided to conduct an extensive culture analysis in 2008. Leading up to the analysis, conflicts within the organization had proven difficult to resolve. Management found it difficult to locate the problems’ origin and believed that awareness of culture would be the first step to solve these problems. Also organizational change offered an opportunity to strengthen the cohesiveness in the organization, as a large part of the organization was moved to Novo Nordisk so the organization would be cut in half. According to Søren Carlsen, organizational cohesion is about building Novo A/S as one company with a culture of openness and close connection between the CEO, managers, partners and staff (appendix 2, Q. 2). This definition fits Schein’s view quite well as he sees a cohesive organization in unifying and harmonious

terms where values are espoused by management and shared by the employees (Martin, 2004: 2). So what did the culture analysis show? ‐ The results from the culture survey helped define how Novo A/S culture is and how the preferred culture looked like. Dorte Barlebo Madsen (HR manager) stated that the culture analysis tool used “illustrated the differences in the organization and measured how the culture was and also how the preferred culture was” (Appendix 1, Q. 3). All employees were asked to score the four values, according to the conceptual model “Competing Values Framework ‐ with a total of 100 points (see theoretical framework). The results were: Current Culture

Average Variation

Collaborate

5‐32

Create

3‐32

Compete

22‐63

Control

1‐51

Preferred Culture

Average Variation

Collaborate

12‐42

Create

16‐42

Compete

8‐56

Control

5‐29

The conceptual model here used can be a tool for organizations to find the most dominant feature of their culture. All organizations have all four characteristics, however, it differs in the relative occurrence of each feature. The culture survey points towards a very results orientated culture where people are very competitive and achievement orientated. Generally speaking, the employees perceive the culture in Novo A/S as a compete culture. “A compete culture is defined as a results‐orientated organization whose major concern is with getting the job done. People are competitive and goal‐orientated. The leaders are hard drivers, producers, and competitors. The glue that holds the organization together is an emphasis on

winning. Reputation and success are common concerns. The long‐term focus is on competitive actions and achievement of measurable goals and targets. Focus is on external positioning, goal achievement and competitiveness” (Facilitation Report, 2008). To understand the nature of the competitiveness in the culture, I have asked Søren Carlsen (Managing Partner) to elaborate: “The competitiveness of the culture is highly important for a large part of the organization. Due to the scope of our business, there is competition on different levels: (1) the competition as investors, when we find a good company and we want to invest, there are many other investors competing to invest in the same company. You can compare it with buying a house. When a really nice house is up for sale, then many people are fighting to get that house. (2) The other competitive aspect is when we are investors in a given company then this company is competing with other companies for being the first to develop a specific drug. We are in a very competitive environment as partners in Novo A/S” (Appendix 2, Q. 3). While competitiveness is a very important aspect of people’s jobs, the results also show that, generally, people would prefer to have a more collaborative culture. “A collaborate culture is a very friendly place to work where people share a lot of themselves. It is like an extended family. The leaders, or the heads of the organization, are considered to be mentors and perhaps even parent figures. The organization is held together by loyalty or tradition. Commitment is high. The organization emphasizes the long‐term benefit of human resources development and attaches great importance to cohesion and morale. The organization places premium on teamwork, participation, and consensus” (Facilitation Report, 2008). The preferred culture scores compared to the actual culture scores shows that the organization, in general, would like to emphasize a collaborate culture mostly, followed by the compete and creative with equal emphasis and the least dominant characteristic should be the control (for explanations of the creative and control cultures see Theoretical Framework). In the questionnaire, I have asked the employees: “to what extend do you believe that a more collaborative culture enforces a more cohesive organization”. 71 % answered that they believed it “a lot”, 6 % believed “a little”, 17 % believed it “moderately”, and 6 % believed it extremely much” (See appendix 4). The definition from the “competing values framework” of a collaborative culture indicates, that it is a cohesive culture in terms of teamwork, participation, and consensus. The answers from the survey show that most employees agree with this definition of a collaborate culture. Because the preferred culture, in general, was a more collaborative, Novo A/S has been aiming at achieving this collaborate and cohesive

culture. The “competing values framework” emphasizes the possibility to change culture and management in Novo A/S saw this as a strategic opportunity to strengthen the organization. From the culture analysis, an interesting trend was found. The scores indicate a rather large variation of scores, which indicate that the employees of Novo A/S did not agree on the matter. The “competing values framework”, can be argued, to oversimplify the values and generalizing to the extent that it can generate contradicting answers. Novo A/S discussed the culture analysis and it became apparent that the lack of consensus in the survey was based upon a fragmented work‐structure which split the team in two large groups: (1) the office‐ based and (2) out‐in‐the‐field professionals. The is due to the scope of their job as one part of the organization is concerned with general administration which is done from the office mostly and the other part of the organization is concerned with traveling and attending meetings with externals. Søren Carlsen (Managing Partner) says, “The jobs in Novo A/S are really very different. Some are out in the “field” negotiating and competing with other organizations. They are usually traveling a lot and are not present at the office as much as those more concerned with administration and bookkeeping” (Appendix 2, Q. 2). In the questionnaire, I asked the employees to describe themselves as either “office‐based” or “out‐in‐the‐field” to discover the size of each group. 59 % categorized themselves as office‐ based and 41 % as out‐in‐the‐field. Furthermore, I asked the questionnaire participants to categorize the two groups with some general characteristics to give a clearer picture of the difference of the groups. The office‐based were described as: women, lower end of hierarchy, desire for social interactions, reliable, conscientious, flexible, thorough, outgoing, friendly, driven, internally focused, organizers and that they in many ways serves as the “anchors” of Novo A/S. They are most of the time working in their office and their primary “customers” are other colleagues (see appendix 4). The out‐in‐the‐field are described as: men, entrepreneurial, competitive, externally focused, opposite of the office‐based, collaborative, political, stressed, and they spend much time away from home, which results in little desire for social interactions. They are most of the time working away from the office at meetings and their primary “customers” are externals (see appendix 4).

It has now been determined that there exist two diverse groups of people in Novo A/S whose diversity consists of differences in: gender, hierarchy, ability, and function. According to Dorte Barlebo Madsen (HR Manager): “We have an increasingly more diverse organization partly because we have hired more young people and international people. We have also expatriated people and that gives the organization diversity” (appendix 1, Q. 6). Furthermore, the Organization is fragmented because of work‐structures. The diversity of the groups along with difference in work‐structure has arguably resulted in two or more different cultures in Novo A/S, one more competitive culture and another more collaborative. The difference in the two cultures, however, is a result of a necessary structural fragmentation because of the different incentives the two diverse groups have. “The out‐in‐the‐field professionals need to be very competition minded and individualistic because of the competitive nature of their job. They have a very high degree of empowerment and they are trusted with a lot of responsibility and money. Therefore, in order for them to be the best, a competitive mind‐set is necessary” (Søren Carlsen, Managing Partner, appendix 2, Q. 3). “On the other hand, the office‐based employees have a completely different agenda. They are the ones who value collaboration cross‐departments more and have to ensure that everything is running smoothly in the organization” (Søren Carlsen, Managing Partner, appendix 2, Q. 3). Dorte Barlebo Madsen (HR Manager) states, “We concluded that we are a very result‐oriented and competitive organization, which some employees were very comfortable with. But at the same time, there were a large part of the organization that wished for a more collaborative organization cross‐departments with a more respectful tone” (appendix 1, Q. 5). Therefore, one could say that the culture was rather split between the office‐based and the out‐in‐the‐ field where the latter were mostly content with the existing competitive culture and the office‐based were discontent because “they felt the competitive culture was “forced” on the entire organization” (Dorte Barlebo Madsen, appendix 1, Q. 5). The office‐based had developed a more collaborative culture, as collaboration and teamwork were a necessity because of the scope of their job. “The office‐based employees are more or less working as the “glue” that hold together the organization and makes sure it runs smoothly” (appendix 2, Q. 3). “Collaboration is an important part of the office‐based jobs (both with the professionals and each other) and they value social interaction to a higher degree than the in‐the‐field professionals” (appendix 1, Q. 5). As these two diverse groups’ differences has not been clearly defined or accepted, conflicts between groups have believed to be the result. The results from the culture analysis show that “several employees from all parts of Novo A/S

struggle with some of the distinct competitive elements of the culture and that many wish for more collaboration and interaction” (Facilitation Report, 2008). 5.2.1 Culture Conclusion The culture in Novo A/S is predominantly highly individualistic and competitive. Internal recognition and standing is achieved through previous educational records, high performance and individual competitiveness. There is, however, a wide variation between individual scores. There is a cultural gab between the office‐based and the professionals in the field. This is to some degree also a gap between men and women. For some employees this is a too hard and competitive culture. “In general, there is a wish in the preferred culture for a more friendly, collaborative and innovative culture” (Facilitation Report, 2008). Identification and encouragement of relationships occurs for the most part within each team and to a lesser degree across the unit. Novo A/S has arguably developed two different cultures in the organization, which has created conflicts and confusion.

5.3 Conflicts Between Two Diverse Groups By acknowledging the fact that there exist two diverse groups in Novo A/S, it became clear that the conflicts that had occurred in the organization, to a large degree, were conflicts between the two groups. The facilitation discovered that the office‐based employees were, in general, rather discontent with the competitive culture existing in Novo A/S and they felt that a collaborative culture was needed to do their job. The out‐in‐the‐field professionals are generally higher in the “hierarchy”, thus having power over the office‐based. The office‐based felt that their contribution to the organization both job‐related and socially was not properly recognized. They also felt that the “tone” from the out‐in‐the‐field professionals was too hard, which indicate that there were problems with communication (Dorte Barlebo Madsen, appendix 1, Q. 5). Some of the conflicts involved the social gatherings where the in‐the‐field employees showed less enthusiasm by not attending or leaving early (Dorte Barlebo Madsen, appendix 1, Q. 5). “The in‐the‐field employees has generally a lower desire for the social activities than the office‐based, which could be because of the stress and time away from home that they spend” (appendix 4). However, the office‐based employees value the social interaction very much and find it to be an important aspect of creating a cohesive culture (Dorte Barlebo Madsen, appendix 1, Q. 5). One example that Dorte Barlebo Madsen gives of

the problems was “that after each breakfast meeting on Fridays, the office‐based employees were left to clean up. The men quickly disappeared after the meeting was done, leaving the women to clean up after them” (appendix 1, Q. 5). This was extremely annoying to the office‐ based as they felt it was a question of lack of respect. One of the communication issues was also that “the office‐based employees felt left “in the dark” when it came to business strategies and new investment projects. The out‐in‐the‐field professionals have many meetings where such things are discussed, yet the office‐based did not feel that they were up‐to‐date as to what was going on in the different departments. They felt that more transparency was needed and, thus, weekly Roll Call meetings were implemented where all employees participate and all new projects are discussed” (Søren Carlsen, appendix 2, Q. 2). “If someone feels that they are cut out of the organization and cannot perhaps see that their work is appreciated, then we have a problem with cohesiveness. This was part of the problem and reason why we decided to put emphasis on the culture in Novo A/S” (Søren Carlsen, appendix 2, Q.2). To resolve these conflicts, management and employees came up with an action plan to achieve the Novo culture vision: achieving a cohesive culture (Facilitation Report, 2008). The actions were to: •

Form a culture group with members representing each department

•

Agree, implement, and live up to the Code of Conduct

•

Implement six actions to support the important focus areas

I will now investigate the three points to find out if they have been implemented since 2008. 5.3.1 The Culture Group In relation to the culture analysis in 2008, the CEO Henrik Gürtler decided that there should be formed a “Culture Group” (Kultur Udvalget) in Novo A/S with members from each department. “The goal was to create a focus group that could discuss cultural issues and come up with suggestions on how to overcome conflicts in that regard” (Dorte Barlebo Madsen, appendix 1, Q. 7). Dorte Barlebo Madsen (HR Manager) is one of the members in the group and she explains, “One of the tasks was to create a Code of Conduct and furthermore discuss the continued effort of bringing about a cohesive organization. There were also taken other initiatives such as “Novo Academy”, which is an arrangement where both internal and external speakers make presentations on different issues such as work‐life‐balance, stress

management, health and so forth. We measured the extent to which the Code of Conduct had helped change the tone in the organization one year after. And our conclusion was that it had helped. We are also conduction “climate‐measurements” yearly, where the culture group works together on creating the questions. Overall, the culture group has helped the awareness of cultural issues and has put emphasis on its importance. It also helps understanding each other’s (view of) culture cross‐department and between the two groups” (appendix 1, Q. 7). 5.3.2 Code of Conduct The conflicts and issues that had occurred in the organization in relation to the culture gap had resulted in problems with respectful behavior. “These problems were, to a high degree, problems with communication, power status, and mutual respect” (Dorte Barlebo Madsen, appendix 1, Q. 7). To resolve these problems, a set of behavioral rules in the form of a Code of Conduct was implemented. It was determined that the culture group should create these rules based upon a discussion of it at a workshop in 2008 (Facilitation Report, 2008). They came up with 12 rules that should guide all employees in the right behavioral direction and even though the rules are “common sense” it was the perception that if clearly defined rules were made, it would somewhat resolve these issues (Dorte Barlebo Madsen, appendix 1, Q. 7). When the Code of Conduct was made, the culture group tested the compliance level with scores from all members of the organization. To see if the rules have had a positive effect on the behavior of the employees, I have tested them again through a questionnaire and compared the scores with the first original average scores from 2008. The results were:

Measuring Code of Conduct Compliance Level In Novo A/S, we are living June May according to Code of Conduct 2008 2010 to a low degree (1) or a high degree (10) We all have responsibility for 6.9 7.7 creating a good working environment We respect each other’s differences 5.0 7.6 without judging one another We all contribute meaningfully to 7.1 7.9 the organization with our different backgrounds, cultures and personalities We are open to new ideas and 7.3 7.3 opinions, new people and cultures, new tasks and new ways of working We work faithfully to execute our 6.9 8.0 decisions. While it is allowed to disagree and make suggestions, when a final decision is taken, we back up and work together to execute it We are open, direct, honest and 6.4 7.5 respectful in our communications. It is important and acceptable to state your opinions We show understanding for each 7.2 7.4 other’s faults or mistakes We keep our promises 7.7 8.3 We follow agreed upon rules and 7.3 8.0 procedures We take responsibility for our 7.4 8.5 actions We share knowledge and 6.3 7.7 information with each other We help and support our colleagues 7.1 7.8 The results from the compliance level of the Code of Conduct show a very positive change in scores from 2008 to 2010. In June 2008, 24 % of the scores were below 5, thus, 76 % above 5. In May 2010, 9 % of the scores were below 5, thus, 91 % above 5. The overall improvements are: an increase in mutual respect, improved execution of decisions, improved openness, directness, and honesty, and improved knowledge sharing.

5.3.3 Six Action Points To support the focus areas, there were furthermore six actions to be taken that employees felt would help resolve the conflicts. They were: 1. Monthly report from Finance, Venture, Seeds and non‐confidential parts of minutes from Board of Directors and Management meetings available on the intra‐web. 2. All investments decision processes made visible and available on the intra‐web. 3. “Novo Academy” with internal or external speakers on monthly/quarterly meetings. 4. Common teambuilding activity for all once yearly. 5. Charity event once yearly. 6. All job descriptions visible for all. I have asked Søren Carlsen (Managing Partner, appendix 2, Q. 9), to report whether these actions have been taken. 1. This has been fully implemented ‐ the latest monthly report is posted on the intra web for all departments. 2. The point was debated and we concluded that the results of our discussions i.e. investment decisions are communicated swiftly but internal discussions in the venture team are not posted ‐ also for practical reasons as much of the process is oral discussions held at our weekly Monday meetings. We do, however, have an overview of actual cases (i.e. companies where we are in the process of defining whether we want to invest) ‐ this is shared with Novo Growth Equity to avoid overlap in our projects ‐ similarly we get their corresponding overview on a weekly basis. 3. Yes this is implemented with speakers ranging from Frank Aaen (venstresocialisterne) to Chris MacDonald (coach). 4. We had the trip to San Francisco in 2008 (for all members of Novo A/S), later we have celebrated 10 years anniversary at Havreholm Castle and a number of smaller events, including picnics and cultural events incl. concerts with dinners.

5. We recently had a charity event with "Grevinde Danner Stiftelsen" 6. Yes. The supportive actions have, thus, been taken. The actions are taken to improve both social interactions (through teambuilding activities, charity events, and “Novo Academy”) and knowledge sharing (through monthly reports from each department and visible job descriptions of all employees). 5.3.4 Conclusion It has now been established that all three steps are taken to help overcome the conflicts between the diverse groups of people. Firstly, the Culture Group has been founded and they meet regularly to discuss the issue and find tools to help resolve the conflicts. Secondly, the implementation and measurement of the Code of Conduct has proven that the problems with communication, respect and knowledge sharing have overall been improved. Thirdly, the six actions points as described above have in essence all been implemented. To conclude, awareness of the problem and the effort from the organization as a whole has resulted in an improved mutual respect, better communication, more emphasis on the social aspect, and improved knowledge‐sharing. All of which should, according to Novo’s vision and mission with culture, lead to a more cohesive culture. Whether these actions have resulted in a cohesive culture will be investigated in the following chapter.

5.4 A Cohesive Culture From the cultural analysis, it is found that Novo A/S has experienced difficulties of achieving a cohesive culture due to the structural fragmentation of the organization and diversity of people. I shall analyze and interpret answers from a questionnaire, which I have conducted to find out whether the Code of Conduct (as a means to managing diversity) has lead to a cohesive culture by which is meant; organizational harmony, which is based on clearly defined values, and shared by the whole organization (as defined in the literature review).

To see if the culture in Novo A/S had moved towards the preferred collaborative culture, I have asked whether the employees believed that the culture had become more collaborative since the cultural analysis in 2008. 25 % said yes, 56 % said to some extend and 24 % said no (see appendix 4). This shows a rather diverse opinion of the culture. I studied the answers and found that most out‐in‐the‐field employees saw a change towards a collaborative culture, while the office‐based did only see a small change or none at all. I, furthermore, asked if they believed the current culture to be characterized by consistency, organization‐wide consensus, and clarity. 18 % said to a little extend. 35% said to some extend, and 47 % said yes mostly (see appendix 4). Again there was no organization‐wide consensus, however most people believed that the culture was consistent and clear to some extend. By these findings, I can conclude that even though an increase in respect, knowledge‐sharing and communication has been met with the implementation of the Code of Conduct, the employees do not agree on the culture and the development towards a collaborative culture. The efforts, from the out‐in‐the‐field professionals, of emphasizing collaboration have not been recognized by the other group. There is still a gap between the cultures of office‐based and the out‐in‐the‐field and efforts of closing this gap has not been entirely successful. The vision and mission of the culture strategy were to enforce a cohesive culture in the organization. It was an initiative from management as they adopted the organizational culture notion that a cohesive culture is desirable because it is seen in harmonious terms with clarity and organization‐wide consensus. I have asked the two managers to report whether they believe the culture in Novo A/S has become more cohesive. Søren Carlsen (Managing Partner) said: “Yes, first of all attention was put on the lack of cohesion which meant that we are more aware of it. There were also established concrete action points, which has helped solve some of the problems. I would say that the awareness of the need for collaboration, and more acknowledgement of the diversity of people has helped improved the cohesiveness of the culture in that I believe we have a common frame of reference now and understand each other’s differences better” (appendix, 2, Q. 4). In contrast, Dorte Barlebo Madsen (HR Manager) said: “No, I think that it is difficult to say that we have a more cohesive Novo A/S, as it is difficult to measure. I think that there is still a cultural gap between the groups and that it will always be there to some extent (appendix 1, Q. 6). While Søren Carlsen can be characterized as an out‐in‐the‐field Manager and Dorte Barlebo Madsen as an office‐based

Manager the contradicting answers are interesting. Furthermore, I find it interesting to discover what the employees think about this issue. I have asked the employees to answer the question if Novo A/S has achieved a cohesive culture and why. The answers were also very different and included (see appendix 4): (1) “Yes to some extend. There are still many silos/departments doing their own thing. Cohesiveness is not needed for success”. (2) “No, probably because the departments work very independently and with specific focus. So, there is a need for trans‐department collaboration”. (3) “To some extend because we are a small company”. (4) “Not really. The different departments have very different focus and stakeholders, so a true cohesive organization is difficult to achieve. However, I do believe that the potential for improvement is apparent”. (5) “I do not think that Novo A/S is quite cohesive. There is still a gap between those who are very competitive and those who are more social. This is not only a question for home‐based and in‐the‐field employees, but also more a question of personalities. The most cohesive factor is getting the job done”. (6) “More than previously as we today all work for the same goals”. (7) Yes, because we have activities that are not work related as well as work related activities that help make is a well integrated organization”. (8) “Yes, cohesive within the individual departments. It will always be fragmented across departments due to the nature of the work. In my opinion there are very few adverse consequences of the fact and so it doesn’t make sense to try to correct it”. (9) To some extend we have, but there’s still very much divided into departments. To get it more cohesive we should stop competing with each other departments and instead collaborate with each other on investments”. (10) “No. There is no common goal”. These 10 answers represent the organization. There seems to be, again, a difference in opinion. The trend of the answers, however, is that there still are conflicts between groups and that departments are not collaborating much with each other. However, cohesion within the departments seems to be good. Some believe that there still is no common goal while others believe that it is the common goal that is the cohesive culture. Some believe that there

is still a gap between the office‐based and the in‐the‐field employees, which is a consequence of different personalities. Some believe that this gap will always exist and that there is no reason to try to eliminate it. Answer (1) raises an interesting point: cohesion is not needed for success. Management apparently has the idea that culture is able to change and that a cohesive culture is desirable. However, this employee (1) questions the need for cohesion. Answer (8) is touching upon the same point. A discussion of this point is presented in the following chapter. Whether it is management ability and/or responsibility to create a cohesive culture will now be investigated. Could it be the failure of the management team that the vision of “achieving a cohesive culture” has not been met? According to Schein (1985) culture is managed top‐down where employees observe the behavior of the manager (symbolic leadership). Some of a more skeptical nature has questioned the extent to which the term culture refers to anything more than an ideology cultivated by management for the purpose of control and legitimating of activity. Søren Carlsen’s (Managing Partner) response to that critique is “that might be so in some organizations, however, I can say with great conviction that it is not so here in Novo A/S. Novo is characterized by being a very strong knowledge‐based company with many highly educated employees. It is also important to note that there is a reason why these people have chosen to work at Novo A/S as they could easily get jobs many other places. So it would not be possible to control these people because they would just switch jobs then. They have chosen Novo because Novo stands for values which they sympathize with” (appendix 2, Q. 6). Similarly, Dorte Barlebo Madsen (HR Manager) states: “That might be the case in some organizations, however, it is not the case in Novo A/S. We are a knowledge‐based organization with highly competent employees and it would be impossible for the managers to “impose” any culture on the employees. There might be some guidelines and some ideas, however, if they did not agree on them then they would not be interested in working here. It is the individuals who create the culture” (appendix 1, Q. 9). So the managers agree that they are not able, alone, to change culture due to the highly knowledgeable and independent employees. They believe, however, that culture is able to change ‐ otherwise the efforts of trying to achieve a cohesive culture would not be worthwhile. Novo A/S, in general, agree that to overcome cultural issue, it is both

management and all employees who should work together on resolving these issue (see appendix 4).

6 ‐ Discussion A Discussion of the empirical findings in relation to the theories described in the literature review, will lead me to draw conclusions and test my theory with the hypothesis stated in the introduction.

6.1 A Diverse Workforce As a means to achieving cohesiveness in the organization, Novo A/S focused on organizational culture. It was assumed in Novo A/S that cohesiveness was desirable because it would eliminate conflicts in their increasingly heterogeneous organization. Novo A/S can be found to have, at least, two diverse sub‐cultures created by a structural fragmentation in the organization. As found above, the two groups are defined in terms of work‐structure, gender, hierarchy, and function. A group of employees; who were primarily working at the office; who were primarily women; who were more concerned with collaboration rather than competition; and who valued social interaction, had formed a culture that stood in contrast to the culture of the other group. The other group of employees were; primarily working out of the office; primarily men; were in the higher end of the hierarchy; were more concerned with competition in stead of collaboration; and valued social interaction to a lesser degree. As stated in the literature review, a diverse workforce can lead to more conflicts, communication problems and lesser social integration. Examples of the behavior issues have been given, and it is arguably a question of courtesy. The office‐based employees felt that they were treated with little respect for what they do, lesser degree of knowledge‐sharing, and lesser acceptance of their diversity from the others. Arguably, the differences of the cultures were not the cause of the “problem”, but a matter of a diverse workforce. The structural fragmentation of the organization has lead to a fragmented culture, which, I argue, is a necessity for the organization to be able to function. The office‐based needs to be collaborative to do their job best possibly which arguably is a question of gender qualities. The reason why the office‐based are primarily women is perhaps because women are better

at multi‐tasking and collaborating than men. On the other hand, the in‐the‐field professionals need to be competitive and perhaps men are generally better at this. This is of course a severe generalization, however, to prove the point of the benefits of workforce diversity it can serve as an assumption. As mentioned in the literature review, diversity in the workforce, in addition to diverse demographic backgrounds, is about difference in culture and intellectual capability (Basset‐ Jones, 2005:169). It is emphasized in Novo A/S, however, that either work‐structure group: office‐based or out‐in‐the‐field, are equally important for the company to run smoothly. One cannot function without the other (Søren Carlsen, appendix 2). This mutual dependency is what has created the “glue” in the somewhat fragmented organization. Even though diversity generally fosters more conflicts, communication problems, and less social integration (Basset‐ Jones, 2005) if it is combined with an understanding of individual strengths and weaknesses, and working relationships that are founded upon sensitivity and trust, diversity has been shown to enhance creativity and problem‐solving capabilities (Basset‐Jones, 2005). The diversity in Novo A/S can be a huge strength for the organization as diversity leads to lower levels of risk aversion and better decision‐making and problem‐solving capability. However, it was problems with understanding each other’s differences and sensitivity (courtesy) that gave rise to cultural conflict in the organization. The conflicts mentioned in the analysis are to a large degree dysfunctional conflicts, which can be reduced by codes of conducts (Beal et al, 2003). The implementation of the Code of Conduct has been an effort of creating mutual respect and better communication so that the organization can benefit from the diverse workforce. The analysis of the compliance level of the implemented Code of Conduct showed a significant improvement of mutual respect, communication, and knowledge‐sharing. The Code of Conduct was an effort from management to impose a set of behavioral rules with the aim of improving the relationships between the diverse groups of people. The Code of Conduct implementation can be seen as a diversity management tool as it was an attempt from management to retain employees as defined by Basset‐Jones (2005). The compliance level of the Code of Conduct, with an overall score‐increase of 15 % above 5, can be seen as a successful attempt of improving behavior. However, the link (that Novo put) between the Code of Conduct and organizational culture will be questioned.

6.2 Multiple Cultures If we first look at the Novo Group, there exist many divisional, geographic, and rank‐based subgroups within the Group, thus, creating many different cultures. If organizational culture refers to a set of values, beliefs, and behavior patterns, the Novo Group is too large a unit with too complex an organization to share the same values, beliefs, and behavior patterns. Not to say, that the companies and people in the Group does not share something. The common frame of reference for the people in the Group is about contributing to a better health of the human kind and to protect the environment. Through drug discovery and development and philanthropic initiatives in the life science field, the Novo Group has reached a very strong identity in Denmark and to an increasing extend also internationally. As stated in the literature review, culture is often defined as that which is shared by and/or unique to a given organization or group (e.g. Schein, 1985). Culture, according to this definition, is an integrating mechanism (Schein, 1985), the social or normative glue that holds together a potentially diverse group of organizational members. I have established that Novo A/S has diversity in the organization, which, along with a fragmented work‐structure, has created multiple cultures. Given the integration view of culture, researchers use “shared” as a code‐breaker for identifying relevant manifestations of a culture, seeking, for example, a common language, shared values, or an agreed‐upon set of appropriate behaviors (Meyerson & Martin, 1987: 323). Because of the promise of clarity and organizational harmony, according to integration views, culture offers the key to managerial control, worker commitment, and organizational effectiveness (e.g. Deal and Kennedy, 1982; Ouchi, 1981) (Meyerson & Martin, 1987: 323). Novo A/S is seemingly following this organizational culture concept, by the fact that they (1) are aiming at clarifying the culture and (2) are striving for organizational harmony in the form of a cohesive culture, and (3) use the term “shared” with respect to their values, and behavior in the form of the Code of Conduct. In contrast to this perception of culture, a Fragmentation view of culture acknowledges the ambiguity of culture as a defining feature in organizations. As defined by Meyerson and Martin (1987) ambiguity is an internal state that may feel like confusion. In this view, there exists; a lack of clarity; inconsistencies; and confusion among individuals. “Culture is like a room full of spider webs, constantly being destroyed and rewoven” (Martin, 2004: 11). If we look at Novo A/S with this view of culture, it seems to be consistent with the findings from the

culture analysis. The fact that the organization could not agree (with the large variation of scores) on the current nor preferred culture in Novo A/S shows confusion about the culture. The culture cannot be seen as being clear and harmonious. The culture analysis showed inconsistencies, contradictions, and confusion among individuals. If we furthermore, take the position that culture is not something an organization “owns” (Schein, 1987), but rather that organizations are cultures. That is, culture is a metaphor of organization; as patterns of meanings, values, and behavior (Meyerson & Martin, 1987:321). Then, the patterns of meanings, values and behavior that the two diverse groups of people have are not something that they “own” but something they are. The fragmented work‐ structure of the organization then, per definition, has resulted in a fragmented culture. Martin (2004) argues that there are many plausible interpretations of any issue or event in organizations, making the idea of a single clear, shared cultural reality highly unlikely. Indeed, Novo A/S has experienced different interpretations of issues and events as to the conflicts that has been in the organization. The out‐in‐the‐field professionals have not seen the matter of the conflicts between groups in the same degree and/or connection as the office‐based nor have they seen the same need for changing the culture.

6.3 Cultural Change The objective of Novo’s “cohesive culture mission8” assumes the notion that culture can be changed i.e. can be managed (not by Management alone but by the entire organization). According to Schein’s perception of the culture concept, cultures are indeed able to change by efforts from management. As discussed in the literature review, the integration perspective of culture promises clarity and organizational harmony and thereby offers the key to managerial control. In contrast, the Fragmentation view of culture denies manager’s ability to control culture due to ambiguity. “The Integration studies of culture offer managers a seductive promise of harmony and value homogeneity that is empirically unmerited and unlikely to be fulfilled” (Martin, 2004:7). From the fragmented perspective of culture, change is a constant flux, rather than an intermittent interruption in an otherwise stable unit (Martin).

8 See appendix 4

If culture is a contradicting concept that is reluctant to change however continually in flux, then efforts of changing cultures can be seen as a waste of resources. Novo A/S has assumed the Integration view of culture, because they believed that their culture could become cohesive by management’s ‐ and employees’ efforts. However, these efforts have not proven to change their culture. They have only succeeded in managing diversity, by which behavioral management is meant, with the implementation of the Code of Conduct. The cultures in Novo A/S are still divided into one competitive culture and one collaborative culture, however, clarity and consistencies in these cultures has not been discovered. Only that there are multiple cultures, has been discovered, and I argue that these differences in cultures are an uncontrollable result of a necessary fragmented work‐structure and a diverse workforce. It is worthless to try and control culture as it is uncontrollable and continually in flux. Acceptance of the different cultures is needed and hereby is meant that trying to enforce one culture on the organization is useless as cultures are organizations and embracing that fact allows for a shift in attention to the real origin of the conflicts in the organization which is arguable a question of courtesy and behaving respectfully with fellow‐colleagues as well as accepting the differences of individuals.

6.4 Cohesiveness Novo A/S is interested in achieving a more cohesive culture as the culture analysis in 2008 found the culture to lack cohesion. The definition of cohesion, as stated in the literature review, was: organizational harmony, which is based on clearly defined values, which are shared by the whole organization. The lack of cohesion is argued, to be because Novo A/S is a fragmented organization in terms of work‐structure and diversity of people. A cohesive culture has not been obtained in Novo A/S since the culture analysis in 2008. I have argued that the efforts of obtaining a cohesive culture are not worthwhile because the multiple cultures in Novo A/S are complex and uncontrollable, hence, making it impossible to manage. The existence of multiple cultures in Novo A/S should not be seen as a weakness because it is a natural development of a diverse and fragmented organization. Striving after cultural cohesion is not worthwhile, I argue, because (1) it is impossible to obtain, and (2) cohesiveness is not desirable. The multiple cultures and diversity might give rise to conflicts and conflict is perceived to damage cohesiveness; however, when it is effectively channeled, it can lead to improved creative problem‐solving and decision‐making, because diversity of perspectives generates more alternatives and greater critical evaluation (Basset‐Jones, 2005).

Cohesiveness makes groups vulnerable to group think (Basset‐Jones, 2005), and Novo A/S should, thus, not desire a cohesive culture. They should embrace the diversity of cultures and accept that a fragmented organizational culture is a necessity to function properly. Conflicts should perhaps not only be seen in negative terms, because conflicts, as opposed to organizational harmony, drive the people to generate alternatives and a greater critical evaluation. A harmonious and stable organization, as Schein emphasizes, is not desirable and one should think of culture as something an organization is and not something it owns. Thus, measuring the “strength” of cultures is irrelevant as they are, according to Martin, ambiguous, resistant to change, and constantly in flux. The real problem, I argue, is managing the diversity of people and work‐structures in a manner so that dysfunctional conflicts are eliminated and the teams can collaborate most effectively and feel that their work is appreciated and valued. The issues Novo A/S have are a question of courtesy and respectful behavior, which have been proven to be enforced by the implemented Code of Conduct. Emphasizing appropriate behavior and acknowledging each other’s differences will lead to more motivated and satisfied individuals in the organization. The hypothesis used to test my theory has, thus, proven to be right as the fragmented work‐ structure and diverse workforce eliminates cohesiveness in Novo A/S. However, as discussed, cohesion should not necessarily be seen as a positive feature and something desirable just because it decreases conflicts ‐ because conflicts are not always a negative thing in organizations. Conflicts regarding diversity of people can arguably lead to improved creative problem‐solving and decision‐making. The hypothesis could then be altered to be: Group Cohesion is not desirable as it decreases creative problem‐solving and decision‐making. The recommendation for Novo A/S is then not to strive after a cohesive culture, but accept and acknowledge that lack of cohesion is a result of a necessary fragmented work‐structure and diverse workforce. The goal should rather be to foster respectful behavior and acknowledging each other’s differences so that some members of the organization do not feel treated with lack of: respect, understanding, and courtesy.

7 ‐ Conclusion This project has reported the complex organizational issue of culture. The aim has been to find ways of understanding culture and, thereby, investigating culture’s importance and influence on organizations. This project has build upon a former cultural analysis of Novo A/S, conducted by external Facilitators, and investigated the link between cohesiveness and structural fragmentation and diversity of people. As the “culture mission9” of Novo A/S has been to create a cohesive culture so that conflicts within the organization could be resolved, the tools used for enforcing cohesion has been analyzed and discussed. The implemented Code of Conduct has been the primary area of investigation and has formed the basis of the Research Question sought answered: Can a cohesive organizational culture be obtained through a Code of Conduct, and if so, why? My findings from this analysis have shown that Novo A/S has a diverse workforce, which has created a more heterogeneous organization. Furthermore, the organization is fragmented due to work‐structures, which has resulted in a culture “gap” between two groups of employees and, in that, a fragmented culture. It has no been possible to change this fragmented culture into a more cohesive culture in Novo A/S. The company has tried to obtain a cohesive culture with efforts such as implementing a Code of Conduct. The Code of Conduct has proven to reduce dysfunctional conflicts by guiding the behavior of management and employees in the right direction. The measurement of the compliance level of the Code of Conduct has shown it to be well improved. However even that the implementation of a Code of Conduct has been successful in terms of reducing dysfunctional conflicts, a cohesive culture has not been established. Novo A/S has assumed the “Integration view” of culture, because they believed that their culture could become cohesive by management’s ‐ and employees’ efforts. However, these efforts have not proven to change their culture. They have only succeeded in managing diversity, by which behavioral management is meant, with the implementation of the Code of Conduct. The cultures in Novo A/S are still divided into one primarily competitive culture and one primarily collaborative culture, however, clarity and consistencies between these cultures 9 See appendix 3

has not been discovered. My findings demonstrate that there are two different cultures, and I argue that these differences in cultures are an uncontrollable result of a necessary fragmented work‐structure and a diverse workforce. It is worthless to try to control culture as it is uncontrollable and continually in flux. Acceptance of the different cultures is needed and valuable as it enhances creativity and minimizes “group think”. It is important to realize that trying to enforce one culture on the organization is useless as cultures are organizations and embracing that fact allows for a shift in attention to the real origin of the conflicts in the organization, which is arguable a question of courtesy and behaving respectfully with fellow‐ colleagues as well as accepting the differences of individuals. I argue that striving for cultural cohesion is not worthwhile, because (1) it is often impossible to obtain, and (2) cohesiveness is not necessarily desirable. The multiple cultures and diversity of people might give rise to conflicts and conflict is perceived to damage cohesiveness; however, when it is effectively handled, it can lead to improved creative problem‐solving and decision‐making, because diversity of perspectives generates more alternatives and greater critical evaluation. Novo A/S should embrace the diversity of cultures and accept that a fragmented organizational culture is a necessity to function properly. The hypothesis of this project has, thus, proven to be right as the fragmented work‐structure and diverse workforce eliminates cohesiveness. The hypothesis could be altered to be: Group Cohesion is not desirable as it decreases creative problem‐solving and decision‐making. The recommendation for Novo A/S is then not to strive after a cohesive culture, but accept and acknowledge that lack of cohesion is a result of a necessary fragmented work‐structure and diverse workforce. The goal should rather be to foster respectful behavior and acknowledging each other’s differences thereby creating value from the diversity of the organization.

8 ‐ Further Perspectives This thesis has been focused on organizational culture and cohesiveness, which emphasized the cultural difference of two distinct groups of employees in Novo A/S. However, an additional focus, which I find interesting is the internationalization of the company’s HR practices as Novo A/S has continued to expand their business internationally which, in turn, influences all aspects of the company’s structure, processes, people, and culture. “Human Resources, like all other business resources, are now being managed on a global scale – and those companies most effectively competing for talent and unlocking their employees’ potential are clearly winning a competitive advantage” (Caligiuri et al., 2010:2). “The methods for growing globally pose a new set of challenges for HR professionals because, in addition to managing the scale and geography, there are also new HR systems to be merged, employees to be integrated, cultures to be assessed, work to be divided, and the like” (Caligiuri et al., 2010:2). Novo A/S are currently facing those challenges as the US Office in San Francisco is expanding as well as foreign citizens are being employed in Denmark. According to Caligiuri et al., The US is known as one of the most individualistic and achievement‐oriented countries (Caliguiri et al., 2010:64). Hence, the culture developed in Novo A/S for the out‐in‐the‐field employees match the US characteristics quite well. Novo A/S has become a multinational organization, which highly depend on people throughout the world to carry out their operations. One important consideration within countries’ HR systems is cross‐border differences in workforce competencies. “Workforce competencies are the knowledge, skills, abilities, and other talents that individuals in a given workforce possess” (Caligiuri et al., 2010). If I were to do further research of Novo A/S, I would focus on the implications of further developing the US office and its culture. An interesting phenomenon, which could be intriguing to focus on in this regard is “cultural agility” ‐ the ability to quickly, comfortably and effectively work in different countries and with people from diverse cultures. In short, “developing managerial and organizational cross‐cultural capabilities” (Caligiuri et al., 2010:74).

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Books and Research Papers

Bartlett, C. A. & Ghoshal, S. (1991) Managing Across Borders: the transnational solution, Harvard Business School Press, United States Bassett‐Jones, N. (2005) “The Paradox of Diversity Management, Creativity and Innovation”, Blackwell Publishing Ltd, Vol. 14, No. 2 Beal, D. J. et al. (2003) “Cohesion and Performance in Groups: A Meta‐Analytic Clarification of Construct, Journal of Applied Psychology, Vol. 88, No. 6, 989‐1004 Buchholtz, A. K. & Carroll, A. B. (2009) Business and Society (7th edn), South‐Western, Canada Caligiuri, P., Lepak, D., & Bonache, J. (2010) Managing the Global Workforce, John Wiley & Sons Ltd, United Kingdom Denzin, N. K. & Lincoln, Y. S. (2000) “The Discipline and Practice of Qualitative Research”, Handbook of qualitative Research Hatch, M. J. (1993) “The Dynamics of Organizational Culture”, Academy of Management Review, Vol. 18, No. 4, 657‐683 Hofstede, G. (1994) “The Business of International Business is Culture”, International Business Review, Vol. 3: No. 1, 1‐14 Kaptein, M. & Schwartz, M. S. (2008) “The effectiveness of Business Codes: A Critical Examination of Existing Studies and the Development of an Integrated Research Model”, Journal of Business Ethics, Vol. 77 Martin, J. (2004) “Organizational Culture”, Research Papers Series (Stanford)

Meyerson, D. & Martin, J. (1987) “Cultural Change: An integration of three different views”, Journal of Management Studies, Vol. 24, No. 6, 623‐647 Saunders, M. et al (2007) Research Methods for Business Students, 4th edn, Pearson Education Limited, England Schein, E. (1985) Organizational Culture and Leadership, Josey‐Bass Publishers, United States Schein, E. (1987) The Art of Managing Human Resources, Oxford University Press, United States Schultz, M. & Hatch, M. J. (1996) “Living with Multiple Paradigms: The Case of Paradigm Interplay in Organizational Culture Studies”, The Academy of Management Review, Vol. 21, No. 2, 529‐557 Schwartz, H. & Davis, S. M. (1981) “Matching Corporate Culture and Business Strategy”, AMACOM Smircich L. (1982) “Concepts of Culture and Organizational Analysis”, Administrative Science Quarterly, Vol. 28, No. 3

Web‐sites http://competingvalues.com/, accessed May 20th, 2010 http://www.novo.dk/, accessed May 20th, 2010

Novo’s Internal Documents Novo A/S Annual Report 2009 Novo A/S Facilitation Report 2008

Novo A/S Organizational Review 2009 Charter for companies in the Novo Group

Appendix 1

Interview with Dorte Barlebo Madsen, HR‐Manager, 7/5/2010

1. Q: Why is culture important in Novo A/S? A: It is important because it creates relations both as an organization and between people.

2. Q: What was the reason behind conducting the culture analysis in May 2008? A: The background behind conducting the culture analysis was a split in the organization; half of the organization was moved to Novo Nordisk. Therefore we wanted to explore what culture existed in Novo A/S and what culture we wanted to have and then to find out how to reach that culture. 3. Q: Did you find the Competing Values Framework useful? And how? A: It illustrated the differences in the organization and it measures how the culture was and also how the preferred culture was. We used external facilitators from Novo Nordisk to conduct the analysis. It was an initiative from management.

4. Q: The aim was to clarify the current culture and create a plan to achieve a cohesive Novo A/S – How do you define a cohesive Novo A/S? A: it is an organization with human relations and shared values. We also recognize that the employees in Novo A/S are a mixture of individuals with different cultural backgrounds, competencies, and values. However I think that it is possible to say that Novo A/S has a set of general values because the same things motivate most employees working here and therefore it is important with flexibility, high empowerment, and freedom with responsibilities. In that relation, we tested all employees with the personality test called Myers‐Briggs MBTI. All employees were type‐specified and then we compared the types with the whole of the organization. We found a close relation between the culture and the MBTI types of the employees.

5. Q: You found that the dominant feature in the current culture was competitive and overall the preferred culture was more collaborative. – How would you reach a more collaborative culture? A: We concluded that we are a very result‐oriented and competitive organization, which some employees were very comfortable with. But at the same time, there were a large part of the organization that wished for more collaborative organization cross‐ departments with a more respectful tone. Management recognized the split between the office‐based employees who were unsatisfied and the out‐in‐the‐field professionals who were satisfied and wished to achieve a more cohesive union with focus on both the collaborative and competitive aspect of culture. The office‐based employees felt that the competitive culture was “forced” on the entire organization, in stead of

embracing collaboration. Collaboration is an important part of the office‐based jobs (both with the professionals and each other) and they value social interaction to a higher degree than the in‐the‐field professionals. The office‐based employees value the social interaction very much and find it to be an important aspect of creating a cohesive culture Have there been any conflicts: Some of the conflicts involved the social gatherings where the in‐the‐field employees showed less enthusiasm by not attending or leaving early. Also after each breakfast meeting on Fridays, the office‐based employees were left to clean up. The in‐the‐field employees quickly disappeared after the meeting was done, leaving the women to clean up after them” 6. Q: Do you have a diverse workforce in Novo A/S? A: Yes I believe we do. We have an increasingly more diverse organization partly because we have hired more young people and international people. We have also expatriated people and that gives the organization diversity. Q: In you opinion, have you reached a more cohesive Novo A/S and in what way? A: No, I think that it is difficult to say that we have a more cohesive Novo A/S, as it is difficult to measure. I think that there is still a cultural gap between the groups and that it will always be there to some extent. However, we have just begun a new project regarding value‐based leadership where management is to define what value‐based leadership is and also what “trust” leadership is. From that will we be able to define the “basic assumptions” in the organization, which binds us all together. From the culture analysis, we were also able to define some key values or words that is reflected in our Code of Conduct. Some of these were tolerance, respect and collaboration. We should all respect each other’s differences, which also were emphasized by the Myers‐Briggs personality testing. 7. Q: You have formed a culture group in Novo A/S – what is the purpose, aim of it? A: In relation to the culture analysis, a culture group was formed with one member from each department. The purpose of the culture group is to support some activities, which allows us to approach the preferred culture. One of the tasks was to create a Code of Conduct and furthermore discuss the continued effort of bringing about a cohesive organization. There were also taken other initiatives such as “Novo Academy”, which is an arrangement where both internal and external speakers make presentations on different issues such as work‐life‐balance, stress management, health and so forth. We measured the extent to which the Code of Conduct had helped change the tone in the organization one year after. And our conclusion was that it had helped. We are also conduction “climate‐measurements” yearly, where the culture group works together on making the questions. Overall, the culture group has helped the awareness of

cultural issues and has put emphasis on its importance. It also helped understanding each other’s view of culture cross‐department and between the two groups. The goal was to create a focus group that could discuss cultural issues and come up with suggestions on how to overcome conflicts in that regard. The conflicts and issues that had occurred in the organization in relation to the culture gap had resulted in problems of respectful behavior. These problems were, to a high degree, problems with communication, power status, and mutual respect. To improve this, we came up with 12 rules that should guide all employees in the right behavioral direction and even though the rules are “common sense” it was our perception that if clearly defined rules were made, it would somewhat resolve these issues 8. Q: Critics have questioned the extent to which the term corporate culture refers to anything more than an ideology cultivated by management for the purpose of control and legitimating of activity. What do you say to this? A: That might be the case in some organizations, however, it is not the case in Novo A/S. We are a knowledge‐based organization with highly competent employees and it would be impossible for the managers to “impose” any culture or values on the employees. There might be some guidelines and some ideas however if they did not agree on them then they would not be interested in working here. It is the individuals who create the culture.

9. Q: Does management in Novo A/S have the responsibility and ability to change the culture? A: Yes, if problems arise, then they have a responsibility. But it is not just management who create the culture. Everyone in the organization is forming the culture.

Appendix 2

Interview with Søren Carlsen, Managing Partner, 7/5/2010

Søren Carlsen joined Novo Nordisk A/S as a research scientist in 1979. He was appointed Vice President of Biotechnology in 1986. In 1991, Søren moved to Davis, California, to establish Novozymes Biotech, Inc., which is a research based company focusing on the development of enzymes and other bio‐industrial products. In 1994, Søren was appointed head of Novo Nordisk's Enzyme business as Corporate Vice President and Chief Science Officer. In this function he was responsible for 400 scientists in Denmark, USA, Japan and China. In 2000, Søren moved to his present position in Novo A/S to establish Novo’s new venture activities. He is a member of the board of directors of 7TM Pharma A/S, PTC Therapeutics, Inc. and Santaris Pharma A/S, and was a board member of Arpida Ltd. Since 1995, Søren has been chairman of Danish Biotech (the Association of Biotechnology Industries in Denmark). He was granted the Danish Chemistry Prize in 1988 (www.novo.dk).

1. Q: Why is culture important in Novo A/S A: I think that the culture in any organization is important but perhaps especially important in an organization like Novo A/S because we do not have a clear product. Hence the way in which we feel about being part of the organization is very important. Furthermore, the way we collaborate and the reason behind even being part of Novo A/S are important. Our “product” is really about value creation for other companies in the life science industry in the form of financial investments. The other goal is that we are a part of creating new product through other companies such as medical treatments and drugs and the common denominator is that we are helping to create something useful and has value to society. And therefore, the “thing” that keeps us all together is the culture and perhaps a common feeling in the culture is associated with pride for the value we create. 2. Q: The aim of the culture analysis was to clarify the current culture and create a plan to achieve a cohesive Novo A/S – How do you define a cohesive Novo A/S? A: Cohesiveness is really about everyone being able to see how his or her work contributes to the whole of the organization and without that employee; the organization could not run as well. We have common goals and strategies and everyone must be able to place one’s role in that connection. If someone feels that they are cut out of the organization and cannot perhaps see that their work is appreciated, then we have a problem with the cohesiveness. This was part of the problem and reason why we decided to put emphasis on the culture in Novo A/S. another important aspect is that the jobs in Novo A/S is really very different. Some are out in the “field” negotiating and competing with other organizations. They are usually traveling a lot and are not present at the office as much as those more concerned with administration and bookkeeping.

Organizational cohesion is about building Novo A/S as one company with a culture of openness and close connection between the CEO, managers, partners and staff. So there was a need of a common frame of reference in order for the office‐based and the travelers to be more in connection with each other. And also that both parts acknowledge the importance of each other’s job and the acknowledgment that without either part, the company couldn’t function. One of the issues that had developed in Novo A/S was a communication issue. The office‐based employees felt left “in the dark” when it came to business strategies and new investment projects. The in‐the‐field employees have many meetings where such things are discussed, yet the office‐based did not feel that they were up‐to‐date as to what was going on in the different departments. They felt that more transparency was needed and, thus, weekly Roll Call meetings were implemented where all employees participate and all new projects are discussed

3. Q: You found that the dominant feature in the current culture was competitive and overall the preferred culture was more collaborative. – How would you reach a more collaborative culture? And why? A: This is correct. The competitiveness of the culture is highly important for the travelers. There is competition on different levels: (1) the competition as investors, when we find a good company and we want to invest, then there is many other investors competing to invest in the company. You can compare it with buying a house. When a really nice house is up for sale, then many people are on fighting to get that house. (2) The other competitive aspect is when we are investors in a given company then this company is struggling with other companies for being the first to develop a specific drug. We are in a very competitive environment as a partner in Novo A/S. On the other hand, the office‐based employees have a completely different agenda. They are the ones who values collaboration cross‐departments more and have to ensure that everything is running smoothly in the organization. Therefore, one could say that the culture was rather split between the office‐based and the travelers where the travelers were mostly content with the existing competitive culture and the office‐ based were unsatisfied with this culture and would rather have a more collaborative culture. The office‐based employees are more or less working as the “glue” that hold together the organization and makes sure it runs smoothly. The in‐the‐field professionals need to be very competition minded and individualistic because of the competitive nature of their job. They have a very high degree of empowerment and they are trusted with a lot of responsibility and money. Therefore, in order for them to be the best, a competitive mind‐set is necessary. 4. Q: In you opinion, has the culture in Novo A/S become more cohesive since the culture analysis? A: Yes, first of all attention was put on the lack of cohesion which meant that we are more aware of it. There were also established concrete action points, which has helped solve some of the problems. I would say that the awareness of the need for collaboration, and more acknowledgement of the diversity of people has helped

improve the cohesiveness of the culture in that I believe we have a common frame of reference now and understand each other’s differences better. We have introduced weekly meetings for all employees called Roll Call where everyone is briefed about what’s going on in the different departments in an informal manner. Also more spontaneous meeting in form of social gatherings has been increased. 5. Q: Has the office in the US any implications on the culture in Novo A/S? A: Yes. We have always had an international focus through our business strategy but that is not to say that we were an international organization. When the US office was established, we hired American employees who had to be integrated but not in the way that they had to adopt Danish norms completely. They have also had impact on the culture and we wanted to integrate the American way of doing things also. I was a bit concerned at first when the office opened in California because there was a risk that the Americans in California would find it difficult to feel connected to the Danes in Denmark and vice versa. The office in the US could easily have developed their own culture in the US. Therefore, I expatriated two Danish partners to the US and an American partner to Denmark. We have off‐site meetings a couple of times per year and I visit the office often.

6. Q: Critics have questioned the extent to which the term corporate culture refers to anything more than an ideology cultivated by management for the purpose of control and legitimating of activity. What do you say to this? A: That might be so in some organizations, however, I can say with great conviction that it is not so here in Novo A/S. Novo is characterized by being a very strong knowledge company with many highly educated employees. It is also important to note that there is a reason why these people have chosen to work at Novo A/S as they could easily get jobs many other places. So it would not be possible to control these people because they would just switch jobs then. They have chosen Novo because Novo stands for values, which they symphonize with. We are based in a good family; the Novo Group who have an overall very distinct culture with a good reputation. We a sharing a lot of the basic cultural characteristics with the companies in the Novo Group, however, we wish to differentiate ourselves from Novo Nordisk, not because we disagree with their values but because we wish to be unique and anti‐bureaucratic. This attracts many young people in particular. The culture is highly important when we employ new people because it is our common frame of reference.

7. Q: Does management in Novo A/S have the responsibility and ability to change the culture? A: We are not able, nor interested in, to completely change the culture but of course management has the ability to influence the culture. Management found it important to address the issues concerning culture because it is highly important that our people are able to work together but it is also important that us managers are able to collaborate. And management is also very different people and we must act as a “role‐ model” for our employees and show how important collaboration really is.

8. Q: What have you done to do this? A: If we look at my team, we are a combination of many different people being it: age, nationality or personality. However, I try to enforce a strong connection between these people by for example: a telephone‐conference every Monday for 2 or 3 hours. This is not only because of the job related issues which needs to be discussed but also very much because a close dialogue helps us related to each other cross continents; we have an off‐site meeting 4 times a year where we are together physically; and teambuilding once a year. This is all internal in my team, yet we are also striving after a close relation to the people from other departments where meetings and social gatherings help improve our collaboration.

9. Q: Have you successfully implemented the six action points? A: 1). This has been fully implemented ‐ the latest monthly report is posted on the intra web for all departments. 2) The point was debated and we concluded that the results of our discussions i.e. investment decisions are communicated swiftly but internal discussions in the venture team are not posted ‐ also for practical reasons as much of the process is oral discussions held at our weekly Monday telecoms. We do however have an overview of actual cases (i.e. companies where we are in the process of defining whether we want to invest) ‐ this is shared with Novo Growth Equity to avoid overlap in our projects ‐ similarly we get their corresponding overview on a weekly basis. 3) Yes this is implemented with speakers ranging from Frank Aaen (venstresocialisterne) to Chris MacDonald 4) We had the trip to San Francisco in 2008, later we have celebrated 10 years anniversary at Havreholm Castle and a number of smaller events, including picnics and cultural events incl. concerts with dinners. 5) We recently had a charity event with "Grevinde Danner Stiftelsen" 6) Yes

Appendix 3 Novo A/S’s Culture Mission and Vision: Mission: “Clarify the current cultures and create a plan to achieve a cohesive Novo A/S” – Facilitation Report 2008. Vision: “We collaborate in a respectful way to achieve company goals” – Facilitation Report 2008

Appendix 4

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Novo's organizational culture Edit Title View Summary Browse Responses

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Response Summary

Total Started Survey: 17 Total Completed Survey: 17 (100%)

Filter Responses Crosstab Responses Page: Default Section Download Responses Share Responses

1. Would you characterize yourself mostly as office-based or out-in-the-field?

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Response Percent

Response Count

(1) Office-based

58.8%

(2) Out-in-the-field

41.2%

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2. In your opinion, does Novo A/S have a "strong" organizational culture?

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Response Percent

Response Count

yes

47.1%

average

52.9%

0.0%

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3. Do you believe Novo A/S's culture to be

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characterized by consistency, organization-wide consensus, and clarity? Response

Response

Percent

Count

No not at all

0.0%

to a little extend

17.6%

to some extend

35.3%

yes mostly

47.1%

yes exactly

0.0%

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4. To what extend has these issues been improved since Create Chart Download the culture analysis in 2008? Rank 1 to 5. (1 being no improvement and 5 being much improved) Response

(1)

(2)

(3)

(4)

(5)

0.0% (0)

25.0% (4)

43.8% (7)

25.0% (4)

6.3% (1)

12.5% (2)

25.0% (4)

18.8% (3)

43.8% (7)

0.0% (0)

Social interactions (increase)

0.0% (0)

31.3% (5)

37.5% (6)

0.0% (0)

acknowledgment of your job

26.7% (4)

20.0% (3)

40.0% (6)

6.7% (1)

6.3%

18.8%

43.8%

25.0%

6.3%

(1)

(3)

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(1)

6.3%

37.5%

31.3%

18.8%

6.3%

(1)

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(5)

(3)

(1)

6.3%

25.0%

43.8%

12.5%

(1)

(4)

(7)

(2)

18.8% (3)

25.0% (4)

31.3% (5)

25.0% (4)

0.0% (0)

Communication with colleagues

"Tone" in organization

Updates on activities

Cross-department collaboration

Respect

Celebration of succes

5. In your opinion, has the culture become more collaborative since the culture analysis in 2008?

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Response Percent

Response Count

Yes

25.0%

To some extend

56.3%

18.8%

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6. Does Novo A/S have a cohesive organization and why?

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yes

Tue, May 18, 2010 7:12 AM

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N/A

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I am field based and mainly

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interact with my colleagues in

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interact with my colleagues in the Novo venture team which I find generally cohesive.I do interact but less frequently with other colleagues in Novo AS and have had no problems. 4.

I belive so. Small organisation, reasonable transparency

Mon, May 17, 2010 2:58 PM

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Yes to some extend do to respect for what other do. Still

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many silos/departments doing their own thing. Cohesivness is not nedeed for success. 6.

NO. Probably because the departments work very independently og with specific focus. No really need for transdepartmental collaboration.

To some extent. Because we are a small company.

Not really. The different departments have very different focus and stakeholders, so a true cohesive organization is difficult to achieve However, I do believe that the potential for improvement is apparent.

It is more cohesive within departments than across departments (which is natural). Relatie to other organizations I know of, it think Novo A/S is quite cohesive.

10.

I do not think that Novo A/S is quite cohesive. There is still a gap between those who are very competitive and those who are more social. This is not only a question of home-base and inthe-field employees, but more a question of personalities. The most cohesive factor is 'getting the job done'. Code of Conduct helps getting in the right direction.

11.

More than previously as we today all work for the same goals:a. get financial result to the company/the foundation and b. make a difference in society through our portfolio companies in Ventures, Seeds and Growth equity (a few finance people only working for a.)

12.

fairly cohesive

Thu, May 13, 2010 11:11 PM

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13.

Yes, because we have activities Wed, May 12, 2010 5:27 PM

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that are not work related as well as work related activities that help make it a well integrated organization. 14.

Yes, cohesive within the individual departments. It will

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always be fragmented across departments due to the nature

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departments due to the nature of the work. In my opinion there are very few adverse consequences of that fact and so it doesn´t make sense to try to "correct" it. 15.

Beacause of the Vision, Mission sets the overall tone and we

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have dept goals and individual goals that relate to the dept goals. 16.

To some extend we have, but there's still very much divided into departments. To get it more cohesive we should stop competing with the other departments and instead collaborate with each other on investments.

17.

No. There is no common goals.

25 responses per page

7. To what extend do you believe that a more

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collaborative culture enforces a more cohesive organization? Response Percent

Response Count

None

0.0%

Little

5.9%

Moderately

17.6%

a lot

70.6%

extremely much

5.9%

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8. Write some general characteristics of the office-based-

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employees Response Count Hide replies

n/a

Tue, May 18, 2010 7:12 AM

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N/A

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collaborative, professional, fair

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minded. 4.

internally focused,

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Organizers, focus on internal

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Mon, May 17, 2010 12:39 PM

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reliable, experienced, consistent, Wed, May 12, 2010 11:01 AM

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More interaction. More knowledge of their activities both on the job and privat.

Lower end of hierarchy Women Concerned about cohesiveness

A somewhat diverse group, that in many ways serves as the "anchors" of the Novo culture. The group is characterized by great loyalty to Novo and also of having stayed in the organisation for a long time, i.e. there is no "turn-over" of employees.

Spend most of the time helping with supportive tasks. Mostly interacting with people within Novo A/S

10.

Most employees are social, some do tasks for the good of the organisation, result oriented, most share personal information

11.

Careful, accountable, team players

12.

we are all essentially officebased so i dont understand this question

13.

Knowledgeable, outgoing, good sense of humor, intelligent, driven, friendly.

14.

Mostly female. Understandable desire for social interactions

15.

conscientious, flexible, thorough 16.

Most of their time is the work

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based in the office. The primary "customers" are other colleagues and secondary externals. 17.

Women

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9. Write some general characteristics of the in-the-field-employees

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n/a

Tue, May 18, 2010 7:12 AM

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N/A

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similar to 8.

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externally focused,

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Independent decision makers,

Mon, May 17, 2010 1:20 PM

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focus on external topics 6.

Opposite of item 8.

Mon, May 17, 2010 12:39 PM

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Opposite of 8 above

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Highly professional and dynamic Sun, May 16, 2010 2:57 PM

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group. However there is maybe not much engagement in the "culture" of the organization, which is predominantly left to the "home based" employees. 9.

Sun, May 16, 2010 5:15 AM

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Competition, result oriented, less Sat, May 15, 2010 1:56 PM

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Spend most of the time on task related to investment portfolio matter (e.g. fund managers, protfolio companies, etc.) Mostly interacting with people outside Novo A/S

10.

interested in tasks not directly linked to the job, mostly respectful. Some also social. 11.

Competent, ambitous, hard

Fri, May 14, 2010 6:52 PM

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working, competitive 12.

there are no in-the-fieldemployees; i think of that as sales people who travel +200 days a year

13.

Not sure

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Mostly male. Entrepreneurial,

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competitive, collaborative, political, stressed. Much time away from home=little energy/need/desire for social interactions 15.

flexible, quick to react to situations and find solutions

16.

Most of the time is the work based on meetings etc. with investment candidates. Primary "customers" are externals and secondary other colleagues.

17.

Men

25 responses per page

answered question

skipped question

10. When conducting the cultural analysis in Create Chart Download 2008, cultural issues were discussed and action points were made to overcome these issues. In your opinion, is it Management responsibility to resolve the cultural issues, if they are able to?

They are not able to resolve them

Response

Percent

Count

0.0%

Both management and all employees should work together

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69Â

SurveyMonkey - Survey Results

20/05/10 14.14

employees should work together

76.5%

17.6%

5.9%

answered question

skipped question

to resolve them it is mostly management's responsibility It is definetely management's responsibility

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