Organizational Culture
Organizational culture is a popular and a very complex concept, and has been identified as an influential factor affecting the success and failures of organizational change efforts.
Components of organizational culture
An organizational culture may include the following[1] (Hofstede 1997):
Values. Values are beliefs. They are things that are most important. For example, for schoolteacher educating pupil is most important thing, no matter how he/she does it.
Attitudes. It is the way the company thinks. It could also include collective behaviour such as business formalities or ceremonies.
Norms and Expectations. That is things that expected from members of company. As a example, police officer on duty expected to wear his/her uniform.
Rituals, symbols and routines. Business logos can be example of symbols, though they are directed outwards.
Most successful organizations tend to have stronger cultures that is widely shared among its employees and reflected in their everyday actions.
Different countries have different ways of doing business, different culture, different values and assumptions which influence the organization style. Therefore, Hofstede (1997) believes that national culture needs to be considered as one of the major factors which influence organization culture in various ways.
Types of Organizational Culture
Organization culture can be classified into four types (Harrison, 1972):
Power culture. This is the type of organization controlled by a key central figure, owner or founder. Power culture suits small organizations where the leader has direct communication with employees.
Role Culture. This is the organization where authority based up on function and position. These organizations have formal structure and operate by well established rules. Though this is bureaucratic style, it can be very efficient when the organization is large and work is predictable.
Task Culture. The main concern in task culture is to get the job done. In these type of organizations there is no clear leaders. Individuals who are experts at accomplishing certain aspects of task considered important and performances are judged by results
Person Culture. Unlike the three other cultures, the purpose of this type of organization is to serve the interest of individuals who works within it. Management positions in these organizations are often in lower status than professionals. However, these types of organizations are rare.
Cox and Hopkins (2006)[2] too divide organizational culture into four category: Control, Role Goal and Soul. They believe that although each culture is present to some extent in organization, usually one or two cultures predominate.
Role of Culture within the Organization
Schein (2004)[3] says that organizational culture matters because cultural elements determine strategy, goals and modes of operating. Therefore, creating good, strong culture is vital for business in long-term success. However, few organizations spend time on understanding their cultural values. Many organizations lack of understanding their core values.
Moreover, Green (2007) claims that the main problem for leaders in many businesses is not a competition, but a lack of understanding their own core corporate culture. Green (2007) further indicates that core organizational values guide an organization while an individual operates on a set of core values that dictate their actions. That’s why creating corporate culture in a business is sophisticated as different people have varying values.
Christensen (2006) analyses the strong culture within the organization as one of the most powerful tools that a skilled manager can wield. He states that as organization grows, it becomes impossible for the general manager personally to get involved in every single decision making within the organization such as who to hire, what new markets to go into, and what new products to launch. Because all the decisions are made by relevant people in a consistent manner which makes companies less bias.
And the only way to realize this is through developing clear priorities that staff and management instinctively apply as criteria in their decision making activities. This is the result of strong culture as it is essential to consistent decision making as the organization expands both in size and scope.
Furthermore, it also helps to the delegation and allocation of tasks to specific people such as new product launch and development as it becomes impossible for the general manager to oversee every project within the organization, and this can also be achieved through successful and strong organizational culture (Gray et al, 2007).[4]
And again, if the organization develops a strong culture and all the members of management and employees follow it accordingly, this leads to a successful outcome and desired corporate goals.
Robbins (1989)[5] emphasizes that organizational culture has a following functions within the organization:
1. Culture helps to distinguish one organization from another. As culture plays an important role in the operation and development of organizational core strategies and goals, if culture is well set and followed in the organization, it differentiates the organization from others making it unique which reflects its decisions both in the short and long terms.
2. Culture implements the sense of identity and unity. A strong culture is a fundamental base to unite around as it unites everyone under one goal, the organizational goal. This can be strengthened through rewards and reinforcements and celebrating corporate success which was achieved as a team.
3. Culture focuses on the interest of the majority rather than the self-interest. As strong organizational culture unites employees under one goal, it ensures that corporate goals are preferred and chosen over individual interests as this is one of the core purposes of the organizational culture.
4. Culture strengthens the social system stability as a social glue that holds the organization together. One of the core functions of the organizational culture is to enhance the team building within the organization as it leads to efficient ways of working and achieving corporate results. Moreover, it also works as a glue to hold the organization together which helps to retain key employees which are the success factors for the organization by making them loyal and striving to achieve the corporate objectives.
5. Culture serves as control mechanism and shapes the attitudes and behaviour of employees. Another function of the organizational culture is to establish a control system. Due to the cultural beliefs within the organization, employees are rewarded or punished, promoted which creates an unwritten rule which is eventually followed by all employees in the organization.
If it is too harsh as a control system, it may even adversely impact on the behaviour and motivation of employees; therefore, it has to be fair and should be more of a motivationally inclined.
In this portal you can find analysis of organizational culture of major international companies.
[2] G Cox and W Hopkins (2006) “Developing a Whole Organization Culture”, Available at: www.learningconsortium.eu
[3] E. Schein (2004) , “Organizational Culture and Leadership”, Jossey-Bass, New-York
[4] D Gray, D Hall, R Jones, C Raffo, I Chambers (2007) “Business Studies”, Person Education, UK
[5] S Robbins (1989) “Organizational Behaviour”, Prentice Hall, UK