The Leader's Guide to Corporate Culture by Harvard Business Review (Magazine January–February 2018) explains strategy and culture are among the primary levers at top leaders' disposal in their never-ending quest to maintain organizational viability and effectiveness. "As someone once said, culture eats strategy for breakfast" was a great read from the same that enlightened many on this topic.
Culture is the tacit social order of an organization, and it shapes attitudes and behaviors in wide-ranging and durable ways. Cultural norms define what is encouraged, discouraged, accepted, or rejected within a group. When properly aligned with personal values, drives, and needs, culture can unleash tremendous energy toward a shared purpose and foster an organization's capacity to thrive.
Differentiating between Organizational and Corporate Culture:
Terms like Organizational, Corporate, and Company culture are buzz words that have been going around for a while now, exponentiated by the online workspace. These terms are often used interchangeably and are thought to be easily replaceable by one another. However, nuances within the terminology do definitely exist, and it takes some artful observation to pick on the subtleties that lie within these terms. BizFluent deems Corporate culture as for-profit corporations, whereas "organizational culture extends to all forms of organizations, including small businesses, privately held companies, and non-profit organizations."
Strengthening an Organization's Identity:
According to a 2021 McKinsey survey, "Culture change should be business-led, with clear and highly visible leadership from the top, and execution should be rigorous and consistent." "Companies are more than five times more likely to have a successful transformation when leaders have role-modeled the behavior changes they were asking their employees to make." The role of HR in strengthening the identity of an organization is vital and undeniable. It all starts with: Developing purpose and having a direct impact on strategic choice-making and determining work ethic. HR also greatly influences role creation and valuable identity building within the purview of the organization and understanding its health through systematic data analysis.
Forming the culture:
"Culture is something that is learned over time, and it starts at the top," says Dr. Harold Hardaway, thought leader on corporate communications and culture and CEO of Cardigan. "The founder of an organization or current CEO has the biggest impact on culture," Hardaway says. "What they think is important, whom they hire, and how they distribute resources all have an impact on and influence culture." Organizational culture is also passed down; Hardaway explains, "one employee trains the next, and their assumptions about the right way to do things are passed down. Managers and leaders learn what worked to get out of rough patches in the past, and they are likely to repeat them because they worked." This is something that must be ingrained into every company, whether new or old.
It is imperative that a leader or leadership team first ascertains what their own beliefs are regarding company handling or the mission.
As the leaders' philosophy is believed by team members, organizational culture forms and impacts the employer brand, he explains. "Once beliefs are reflected upon and stated, then we need to think about the behaviors we want in the organization that is influenced by our beliefs but will drive the outcomes we wish to have.
After defining productive behaviors of your company culture, there needs to be intentional, implemented, and audited processes in place to make those behaviors persistent and reward generating. Finally, come the measures and outcomes that you can track and wish to have as a result of that culture.
Characterizing organizational culture:
High-value innovation culture is characterized by encouraging employees to take risks. Companies with a low value on innovation expect employees to perform as trained without looking for ways to improve performance.
Attention to Detail
Companies that value attention to detail expect employees to perform with precision; those with a low value do not.
These companies care about outcomes, not how outcomes are achieved.
How decisions will affect employees is of high import in these organizations.
Companies with a high value on teamwork rather than the individual tend to have positive relationships between co-workers and managers.
This characteristic dictates how aggressively employees are expected to compete in the marketplace.
Rule-oriented, predictable, and bureaucratic, these companies provide consistent and predictable levels of output and operate best in non-changing market conditions.
Employee involvement is highly valued in these companies. Employees are trained to serve the customer well, and cross-training is the norm. Employees are empowered to resolve customer problems in ways they see fit.
Safety-sensitive jobs are performed in these companies. Maintaining a safe culture provides a competitive advantage. This culture revolves around reducing accidents, maintaining high levels of morale and employee retention, and increasing profitability by cutting workers' compensation costs.
Nine Types of Organizational Culture:
Culture varies depending on the organization, but numerous studies show the type of culture falls into nine categories. What they are named depends upon the study, but they basically break down to these nine described in the Management Study Guide:
Norms and procedures are predefined in this work environment. "Employees behave in an ideal way and strictly adhere to policies." No one dares to break rules and everyone sticks to published policies. For example, the military.
Emphasis is on clients and external parties. Customer satisfaction is employee motivation. Clients are treated as gods, and employees do not follow any set rules. "Every employee strives hard to satisfy clients to expect maximum business from their side." E.g., Car dealerships.
Skilled individuals are hired into these hierarchical cultures, and their roles and responsibilities are delegated according to employees' backgrounds, educational qualifications, skills, and work experience. Emphasis is on training. "Employees in an academic culture stick to the organization for a longer duration and also grow within it." E.g., Teaching hospitals.
Employees are the most treasured possession of the organization. They have a major role in its successful functioning. "Individuals always have an upper edge, and they do not bother much about their organization." E.g., Advertising agencies.
In this culture, organizations are very particular about the employees they recruit. Specialization, educational qualification, and interests are key in employee selection. Every employee does what he is best at, and high-potential employees are promoted accordingly. Appraisals are a regular feature. E.g., High-tech companies.
In this culture, employees are not certain about their career and longevity. They are terminated if the organization does not perform well. "Individuals suffer the most when the organization is at a loss." E.g., Investment firms.
Employees are constantly watched in this organizational structure. Feedback is essential. Performance is reviewed from time to time, and employee work is thoroughly monitored. "Team managers are appointed to discuss queries with the team members and guide them whenever required." E.g., Exxon Mobile. E.g., Oil and gas companies.
Bet Your Company
In this workplace culture, organizations make risk-taking decisions, and the consequences are unforeseen. "The principles and policies of such an organization are formulated to address sensitive issues, and it takes time to get the results." E.g., Space exploration companies.
Employees in this type of culture adhere to the processes and procedures of the organization. "Feedback and performance reviews do not matter much in such organizations. The employees abide by the rules and regulations and work according to the ideologies of the workplace." E.g., All government agencies.
Organizational change does not come right away, nor naturally.
"Since culture is developed over time," Hardaway explains, "it takes time to change the culture."
Once you have determined the desired values and behaviors, "you have to work to change the minds of the senior leadership team." Then you need to come up with behavioral descriptors for each value and articulate how those translate into actionable behaviors at all levels. You have to then align strategy and processes to make a culture change. The timing of the change depends on the organizational culture and leadership deciding how and when to alter the current culture.
Conclusion: Organizational culture and recruiting:
"Company culture has the potential to be your best calling card for the employees you want and the best stop sign for the employees you do not want," says Hernandez. In companies with a strong culture, culture affects recruiting and employee engagement.
An example of a great organizational culture, says communication strategist and chief creative officer for Cardigan, Shannon Hernandez, C.H. C., is H-E-B, a grocery company in Texas. "It has a great people-first culture that has earned them both a loyal employee and customer base. You also read about companies like Southwest Airlines and Zappos. What they all have in common is they put people first and they focus on hiring people who believe in their mission and will work to advance the mission."
The answer to that question may well determine how successful you are in your recruiting efforts. According to a recent Glassdoor Economic Research study, 77 percent of job seekers consider a company's culture before applying for a job and 73 percent will not apply to a company unless that company's core values align with their own.
A recent MIT Sloan Management Review study indicated that 93% of company employees of various companies considered for the survey give weightage to the culture of the company when selecting their place of employment and consider the environment their employers make in online reviews. This is the era of employers reviewing what it is that they are offering to their employees and not vice-versa.
Chris Ruben, co-founder and managing partner of The Pontem Group, explains that "organizational culture is what leads when leadership is not there." It consists of all the unspoken rules.
"I used to think company values were a bunch of [hooey] in my younger professional days, but as you study leadership and when you see leaders actually coach to values, you understand their importance." Ruben does think there are too many clichés and "no kidding" values coming out of human resources "but ones that are intentional, believable, and used in making grey decisions is what the fabric of organizational culture is."
These intangibles and shared values of an organization's culture are important because they decide the way group members interact and go a long way to promoting healthy competition within the organization. Culture gives employees a sense of direction and brings all employees on a common platform for decision-making. It also creates the brand image and gives an identity to the organization, which then unites employees from otherwise different backgrounds.
The best takeaway from this piece can be succinctly presented by reviewing Chick-fil-a's company culture: most people who have been to Chick-fil-a have experienced their customer service—there are even memes about how above and beyond they go. If you are someone who does not want to say, 'my pleasure,' you will probably not choose to work there, which is great for both the candidate and Chick-fil-a. If that is the type of culture you want, you would immediately apply. The culture attracts you." You embody the organization that you choose to be a part of. A company with a strong sense of its own culture shows how well aware you as an employee are in knowing who you are and what it is that you want, thus enabling you to be a valuable addition to the team, in a way of a mutualistic, beneficial relationship.