What is organizational culture? Definition and examples
Organizational Culture is a group of internal values and behaviors in an organization. It includes experiences, ways of thinking, beliefs and future expectations. It is also intuitive, with repetitive habits and emotional responses. We also call it Corporate Culture.
Organizational Culture is the result of a perception within the company that its employees all share.
Richard Perrin, Partner and Head of Advisory at KPMG in Romania, defines the term as:
“The sum of values and rituals which serve as ‘glue’ to integrate the members of the organization.”
Corporate culture comes under the umbrella theme ‘organizational economics.’ Organizational economics is the study of how humans create and develop organizations. It also looks at how organizations affect economic growth.
Organizational culture – leaders
Companies can create or shape their organizational culture through leaders. Leaders can communicate and lead according to what companies want in their corporate culture.
However, even though leaders can shape the internal culture, in some cases companies already have a strong and established culture. In such cases, this can determine what type of leader the organization requires.
Company leaders also have to be aware that corporate culture can change. We must remember that culture is linked to knowledge. In other words, whatever didn’t work in the past, would have to be done differently.
Consequently, if any belief or idea doesn’t go with the internal environment, then the organizational culture will evolve.
Adapting to change
Leaders should also be aware of how hard or easy it can be for the corporate culture to adapt to changes in the company. Adapting to the marketplace may also be hard. In this context, the word ‘marketplace’ means the same as ‘market’ in the abstract sense.
In some cases, employees can be resistant to change. They may even try to work against it. However, communication leaders can address this behavior.
Organizational culture only works effectively if all employees participate and constantly work to shape it. However, it is not something that changes overnight.
Organizational culture – types
Organizational culture is a unique phenomenon. However, there are some general corporate culture classifications.
An organization ruled by a power culture has a strong leader influencing behavior and values. The leader also influences ideas and beliefs.
This type of culture is very common in small companies, early-stage businesses, and startups.
In a role culture, formal systems determine values and beliefs. Government departments, for example, exist in a role culture.
In a company with a task culture, employees value task completion and achievements.
We often see this type of culture in project teams where time and task resolution are important.
In other words, we see this in project teams where getting things done and meeting deadlines are top priorities.
In this type of culture, personal interests, beliefs, and ideologies are important drivers.
A professional services company that incorporates a lot of the beliefs and ideas of its own employees, for example, has a personal culture.
Video – organizational culture
This Denison Consulting video talks about organizational culture and explains what it is. It begins by telling us that every organization has its own unique culture.