Understanding organizational culture is challenging due to the complexity of human behaviors, motivation, and relationships. Culture is an assembly of extensive attributes that range across vast aspects of interaction and actions. The normalized behaviors of an organization's culture can incur positive and negative consequences for job performance and work satisfaction.
Understanding the culture of an organization
Organizational culture is the accepted behavior of individuals within an institution. It is the shared common values of individuals and how they accomplish the organization’s goals.
Understanding the culture of an organization is not a short-term objective. Culture is a complex relationship between the organization and its stakeholders. To understand an organization’s culture, participants need to ascertain multiple facets of the establishment.
The direct way to discover culture is to look at the proclaimed values, goals, and processes of an organization. Formal culture can be identified in firm artifacts such as employee handbooks, mission statements, and established rituals such as all-hands meetings. Additionally, formal culture can be identified in objects such as motivational art, employee awards, and accepted work attire. Established processes such as recruitment, incentives, and hierarchy are also part of formal culture.
Lamentably, the formal concept of an organization’s culture is often a stated ideal that may not coincide with actual organizational behavior. Without a deeper understanding, organizational leaders may presume that the cultural reality aligns with espoused cultural ideology. It is a fallacy that the firm culture is what leaders believe it should be.
Organizational culture consists of behaviors that exist deeper than a management mandate. It includes deeply rooted beliefs, assumptions, and conduct of individuals. Although it is influenced by formal proclamations, informal culture can be propelled by popular social norms or influential individuals.
Truly understanding the culture of an organization may require a 3rd person perspective. Attempt an unbiased observation of individual interaction among peers, subordinates, and clients. Identify when interactions and their outcomes align to stated culture and when actions are not within expected boundaries. Anonymous surveys and formal interviews can also provide insight.
Because culture is complex, categorizing a firm’s culture by various attributes can contribute to understanding. Common attributes can include power centers, communication, creativity, transparency, integrity, adaptability, risk aversion, accountability, etc. Each facet of organizational behavior may impact culture to different degrees.
To understand the culture of a firm, study the aspect of power and decision authority. It is important to recognize distinct centers of power and perceived authority for decisions. Consider that authority within an organization can be formal, bestowed with a title or control of reward or penalty, as well as informal, due to expertise or respect. Because of their significance in organization relationships, individuals with authority influence the overall culture of an organization and may be a foci of institutional change.
Centers of power differ from individuals with authority but also influence organizational dynamics. Power centers can be teams or departments that control information and resources that others need. Ascertain if there is an informal decision process, competing priorities, preferences, or conflicts of interest. Understanding the outcome of contested resource allocation provides additional insight into organizational culture and what members prioritize.
Another important part of understanding culture is understanding how communications are emphasized as well as the methods of communication. How an organization communicates affects the dissemination of knowledge and culture. Analyze the accuracy, consistency, and honesty of leadership and peer communications. Although organizations may have established advanced communication platforms and practices, information may not consistently be broadcast or consumed via recognized channels. Although information may be available, due to the increased flow of information emails often go unread, website are not reviewed consistently, etc. Instead, the culture may support alternative channels like town hall meetings, message apps, or corporate retreats to successfully dispense knowledge.
Commonly advocated positive cultural traits, for example transparency and integrity, also have to be viewed at a deeper level. Multiple aspect of organizational behavior can depart from the expected standard. Although an organization may have established rules and legal obligations, minor infractions may be overlooked to achieve specific advancement, which over time may lead to cultural shifts to a new norm in behavior. Also, it is important to understand the impact of incentive programs and how they affect performance and drive behavior.
By comprehending the various aspects of an organization’s culture, it becomes possible to correlate the influence on the trends in behavior. The impact of each aspect may impose positive, negative, or even neutral effects on employees and firm performance.
Understanding the impact culture
Culture can have a negative sway on performance and on individuals. Consequences range from stifled creativity and lack of communication, to abuse of power.
Organizational size, power structure, or confidentiality requirements may advance a culture with centralized authority. However, organizations with centralized decision making and authority may find that leaders are overloaded by the volume of decisions required contributing to flawed judgment. If the culture limits the dissemination of information or resources, associates may not have the knowledge to make effective decisions or they may lack the resources to initiate improvements.
Even minor instances of questionable integrity have consequences for stakeholders. Convoluted pricing or billing rates, disregarding conflicts of interest, and other problematic practices eventually adversely impact clients and diminish relationships. Incentive programs without proper controls may inadvertently incentivize improper behavior. Inaccurate leadership communications erode subordinates trust. Each infraction weakens transparency and integrity. Cultures without strong transparency have contributed to systemic financial scandals; cultures without strong social integrity contribute to the prevalence of sexual harassment.
Of course, culture can also have a positive impact. Strong positive cultural attributes enhance stakeholder relationships, increase innovation, and improve responses to change or challenges.
Inspiring, honest, and consistent communication and connection increase cultures of transparency and agility. By providing access to quality information, individuals make superior decisions causing authority to extend broadly though a firm. Decentralizing power enhances responsiveness to issues which lowers risk. Firms with a strong culture of adaptability and lower risk aversion may innovate new technologies that provide significant advantages over competitors or provide new lines of business. Individuals gain new experience and knowledge, which is applied to advance the goals of the firm.
Most importantly, a positive company culture directly correlates to higher employee satisfaction. Individuals, especially millennials, expect a clear sense of purpose and a connection to organization mission. Stakeholders who feel valued connect meaning to their output, increasing the worth of the organization.
Depending on the type of vocation and individual character, different cultural attributes have diverse consequences and degrees of impact on work. An assignment consisting of repetitive tasks may not require a culture that promotes creativity, but a culture of transparent communication may be crucial to identify issues or improve processes.
Understanding culture provides an opportunity to appreciate the impact culture imposes on performance and individuals. Because of the complexity of organizational relationships, there are various characteristics of culture that should be considered. The diversity of characteristics provide frequent opportunities for cultural shifts. Depending on the tasks and individuals, strong positive cultures can enhance individual work and organization’s performance.