Understanding Organizational Culture

Written by Max | Edited by Rory Hart
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    How to Change Organizational Culture

    What is Organizational Culture?

    Basically, organizational culture is the personality of the organization. Culture is comprised of the assumptions, values, norms, and tangible signs (artifacts) of organization members and their behaviors. Members of an organization soon come to sense the particular culture of an organization. Culture is one of those terms that’s difficult to express distinctly, but everyone knows it when they sense it. For example, the culture of a large, for-profit corporation is quite different than that of a hospital which is quite different than that of a university. You can tell the culture of an organization by looking at the arrangement of furniture, what they brag about, what members wear, etc. — similar to what you can use to get a feeling about someone’s personality.

    Corporate culture can be looked at as a system. Inputs include feedback from, e.g., society, professions, laws, stories, heroes, values on competition or service, etc. The process is based on our assumptions, values, and norms, e.g., our values on money, time, facilities, space, and people. Outputs or effects of our culture are, e.g., organizational behaviors, technologies, strategies, images, products, services, appearance, etc.

    The concept of culture is particularly important when attempting to manage organization-wide change. Practitioners are coming to realize that, despite the best-laid plans, organizational change must include not only changing structures and processes but also changing the corporate culture as well.

    There’s been a great deal of literature generated over the past decade about the concept of organizational culture — particularly in regard to learning how to change organizational culture. Organizational change efforts are rumored to fail the vast majority of the time. Usually, this failure is credited to a lack of understanding about the strong role of culture and the role it plays in organizations. That’s one of the reasons that many strategic planners now place as much emphasis on identifying strategic values as they do mission and vision.

    Some Types of Organizational Culture

    There are different types of culture just like there are different types of personality. Researcher Jeffrey Sonnenfeld identified the following four types of cultures.

    Academy Culture

    Employees are highly skilled and tend to stay in the organization while working their way up the ranks. The organization provides a stable environment in which employees can develop and exercise their skills. Examples are universities, hospitals, large corporations, etc.

    Baseball Team Culture

    Employees are “free agents” who have highly prized skills. They are in high demand and can rather easily get jobs elsewhere. This type of culture exists in fast-paced, high-risk organizations, such as investment banking, advertising, etc.

    Club Culture

    The most important requirement for employees in this culture is to fit into the group. Usually, employees start at the bottom and stay with the organization. The organization promotes from within and highly values seniority. Examples are the military, some law firms, etc.

    Fortress Culture

    Employees don’t know if they’ll be laid off or not. These organizations often undergo massive reorganization. There are many opportunities for those with timely, specialized skills. Examples are savings and loans, large car companies, etc.

    Understanding the Culture of Your Organization

    Quite often, a leader has a very good sense of the culture of their organization. They just haven’t made that sense conscious to the extent that they can effectively learn from, and lead within, the culture.

    Different people in the same organization can have different perceptions of the culture of the organization. This is especially true regarding the different perceptions between the top and bottom levels of the organization. For example, the Chief Executive may view the organization as being highly focused, well organized, and even rather formal. On the other hand, the receptionist might view the organization as being confused, disorganized, and, sometimes, even rude.

    Here are some basic guidelines to help a leader assess the culture of their organization.

    1. Understand some of the major types of cultures. There are a number of research efforts that have produced lists of different types of cultures. You can start by reviewing the very short list in the previous subsection, Major Types of Cultures.
    2. Describe the culture of your organization. Consider what you see and hear, not what you feel and think. Answer the following questions.
      a. Who seems to be accepted and who doesn’t? What is it about those who are accepted as compared to those who aren’t?
      b. What kinds of behaviors get rewarded? For example, getting along? Getting things done? Other behaviors?
      c. What does management pay the most attention to? For example, problems? Successes? Crises? Other behaviors?
      d. How are decisions made? For example, by one person? Discussion and consensus? Are decisions made at all?

    Note that there may not be close alignment between what the organization says it values (for example, creativity, innovation, team-building) as compared to what you’re actually seeing (for example, conformity, individualism). This disparity is rather common in organizations. You might explain this disparity to other leaders in the organization. An ideal time to address this disparity is when developing a values statement during the strategic planning process.

    Influencing the Culture of Your Organization

    There are four primary ways to influence the culture of an organization.

    1. Emphasize what’s important. This includes widely communicating the goals of the organization, posting the mission statement on the wall, talking about accomplishments, and repeating what you want to see in the workplace.
    2. Reward employees whose behaviors reflect what’s important.
    3. Discourage behaviors that don’t reflect what’s important. There is no need to punish or cause prolonged discomfort. Rather, you want to dissuade the employee from continuing unwanted behaviors by giving them constructive feedback, verbal warnings, written warnings, or firing them.
    4. Model the behaviors that you want to see in the workplace. This is perhaps the most powerful way to influence behaviors in the workplace. For example, if you want to see more teamwork among your employees, then involve yourself in teams more often.

    Cultural change is a significant form of organizational change. Therefore, be sure to review the materials in Guidelines, Methods, and Resources for Organizational Change Agents.

    Here are several articles with guidelines about changing the culture of an organization.

    For many more resources about systematically changing the culture of your organization, see the topic
    Guidelines, Methods, and Resources for Organizational Change Agents

    This Article is in a Series About Understanding Organizational Structures and Design

    This article is the fifth in the series which includes:

    1. What is an Organization?
    2. What Makes Each Organization Unique
    3. How They’re the Same: They’re Systems

    4. Basic Overview of Life Cycles in Organizations
    5. Basic Overview of Organizational Culture
    6. Legal Forms and Traditional Structures of Organizations
    7. Driving Forces and a New Organizational Paradigm
    8. Emerging Nature and New Organizational Structures and Design
    9. Basic Guidelines for Organizational Design
    10. Wrap Up: Grasping the Big Picture in Organizations (video)

    Additional Resources About Organizational Culture

    Also, consider

    Learn More in the Library’s Blogs Related to Organizational Culture

    In addition to the articles on this current page, see the following blogs which have posts related to Organizational Culture. Scan down the blog’s page to see various posts. Also, see the section “Recent Blog Posts” in the sidebar of the blog or click on “Next” near the bottom of a post in the blog.

    Learn More in the Library’s Blogs Related to Organizations

    In addition to the articles on this current page, see the following blogs which have posts related to organizations. Scan down the blog’s page to see various posts. Also, see the section “Recent Blog Posts” in the sidebar of the blog or click on “Next” near the bottom of a post in the blog.

    For the Category of Organizational Development:

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    Max