Organizational culture: the bedrock of the success of your company

Organizational culture: the bedrock of the success of your company

The success criteria may vary for different companies, their goals and their vision.However, there are some key factors whose absence makes success within organizations is impossible, and one of the most important of these factors is organizational culture.

We all have an idea of organizational culture since we hear terms like "corporate culture" or "work culture" a lot, and we're all aware of how this "culture" influences employees, managers, and customers, and how it either fosters growth and productivity or causes businesses to fail.

Before we begin to expand on what organizational culture is and how it is applied in companies, let us define it first:

What is organizational culture?

Organizational culture is defined as the beliefs, behaviors, philosophies, basic values, and forms of interaction that contribute to establishing a unique social, psychological, and organizational environment. Thus, organizational culture involves both permissible and banned activities, as defined by each company's regulations and laws. As a result, organizational culture is built on shared values and behaviors, as well as written and unwritten rules that have evolved over time.

What is the importance of organizational culture?

Organizational culture aids in the achievement of the organization's strategic goals and attracts the perfect candidates for each role. It is also marketed to clients and key stakeholders, making the organization more appealing and trustworthy.

In addition, creating an organizational culture for the company helps to identify some points that everyone should follow, which saves time and effort for important projects, such as:

  • Defining the behaviors that are required of each individual in the company, which must be followed by both employees and leaders, which makes everyone in the organization act according to the prevailing culture.
  • Encouraging innovation, creativity and a feeling of common purpose among all team members.
  • Recruiting capable personnel who will aid in the achievement of the organization's goals and who share the same culture and principles.
  • Enhancing the spirit of cohesion and belonging inside the organization through strengthening organizational identity and involving all employees in the same culture, such as specifying the manner of clothing that employees must adhere to, and responses in specific situations.

Employee turnover (the ratio of employees who leave the company to those who join it over a given period of time) is also influenced by organizational culture. According to a survey conducted by Washington State University's MBA program, college students are willing to accept jobs that pay 7% less than the standard salary if the company meets their visions and values.

What are the types of organizational culture?

According to research conducted by Robert Quinn and Kim Cameron, professors of business administration at the University of Michigan, there are four types of organizational culture:

  • Adhocracy culture.
  • Clan culture.
  • Market culture.
  • Hierarchy culture.

There is a purpose behind every type of organizational culture. So, let's take a look at each quality and how to develop it in more detail.

1. Adhocracy culture

Adhocracy culture emphasizes innovation and freedom in decision-making and continuous improvement, given that every company's status quo, no matter how successful it is, will encounter challenges.

Indeed, this is what distinguishes global companies such as "Google", "Microsoft" and "Facebook", because they give their staff the freedom to improve and innovate, and they make adjustments even when the company is at its best.

Yet it is preferable for startups to remain steady and advance slowly for a longer period of time because the adhocracy culture may be less feasible in these businesses because specific roles and departments require more foundation and building.

In fact, developing an adhocracy culture that includes a high-risk business approach may not be easy. Implementing new strategies and conducting brainstorming sessions in which employees share their ideas, on the other hand, can help boost performance and encourage employees to think differently.

2. Clan Culture

Clan culture refers to a group of people who have common interests and who consider themselves one family working for the public interest. This culture is common in start-ups and small businesses.

The clan culture aims for teams to work collaboratively and to ensure that all employees feel equal and feel comfortable giving honest feedback. It also focuses on guidance, vocational training, and the transmission of competencies from one generation to the next. This is reflected in the work quality and exceptional customer service. The disadvantage of this organizational culture is that it gets more difficult to maintain as the company grows.

3. Market culture

Market culture revolves around increasing profits, staying ahead of the competition, and emphasizing customer satisfaction. Amazon is an excellent example of a company that values this type of culture. Thus, market culture focuses on developing a competitive spirit in all employees and managers, believing that competition fosters creativity and drives people to grow, which will benefit the company's overall outcomes.

Market culture is the most practical type of organizational culture. It focuses on analytics and statistics. If you want to develop it; You should evaluate each position within your organization, calculate the return on investment for each of these positions, and determine reasonable standards of production. And do not forget to reward high performers in order to encourage them to continue and motivate their colleagues to do the same.

4. Hierarchy culture

Hierarchy culture represents the hierarchy of levels of authority and the orderly distribution of responsibilities across the appropriate chain of command. Employees in this culture are aware of who is responsible for them, as well as who they receive tasks from and report to. They are also aware of the rules they must follow in front of their supervisors and managers. Regardless of how effective a hierarchy culture and its system is, it can prevent employees - and sometimes even leaders - from being innovative, agile, and responsive to market and industry changes. Therefore, care must be taken when adopting this culture, and ensuring that employees are constantly trained and developed.

The first stage in establishing a hierarchy culture is to organize tasks and allocate them to the appropriate workers, fill any gaps in the chain of command, and ensure that each team and department has clear long- and short-term goals.

Determinants of organizational culture

There are some elements that help define the organizational culture of companies. Research and studies indicate some determiners that must be taken into account, namely:

1.       The size of the company

Although the difference in the size of the institution does not necessarily affect its organization. It affects how the company is run, how it deals with different situations and solve problems, and these factors in turn affect the company's culture.

2.        Environment

Because of the importance of the environment on the organization of activities and resources, the culture of a company is highly influenced by the surrounding environment, whether it is internal (such as location, employees, and leaders) or external (such as suppliers, customers, and competitors).

3.       Individuals

Individuals have a significant part in shaping the workplace's organizational culture as their belief in the importance and quality of the company's culture helps to reinforce and adhere to it. After all, no boss can force his or her personnel to follow a culture they do not believe in.

4.       Objectives

The objectives of a company often have an impact on its culture. One of the aims of the company, for example, could be to improve customer service. As a result, company culture revolves around values related to the employee-customer relationship. Similarly, if the company's objectives are to increase profits, it will concentrate on market culture.

5.       Technology

Specialized institutions usually focus heavily on technology and values connected to technical skills in their organizational culture, which aids in the formulation of all organizational procedures, whereas service institutions set a priority on customer service and personal skills in their culture.

6.       History and Ownership

Since the history of the institution expresses the nature of the development that takes place in it, it is one of the most important determinants of organizational culture. The quality of ownership, whether it is public, private, national or international, is one of the determinants of the prevailing culture in the organization.

Final thoughts

Adopting an organizational culture in your organization is a necessity in order to set agreed rules, define and distribute tasks and projects in an organized manner, improve employee experience and encourage openness and creativity, which is reflected on the customer experience and the success and prosperity of your organization.

Consequently, whether you are a beginner or an experienced entrepreneur, you must consider it and begin implementing it in order to reach the success you desire.