Organisational Culture is defined as the way in which members of an organisation relate to each other, their work and the outside world in comparison to other organisations. It is the “that’s how we do things around here” of your organisation. It refers to how your company conducts itself as a whole, including the unique ways in which it drives business activities, processes and philosophies.
The success of any business strategy also lies in Organisational Culture as it motivates employees to take necessary action. But how does it develop? More importantly, how can you nurture it to support successful outcomes?
In this article, we'll explore how Organisational Culture develops.
What is organisational culture?
As a collection of values, practices and expectations, a company’s culture clearly defines what are acceptable behaviours within your organisation. It also impacts how management and employees work – from training new employees, running meetings and facilitating employee engagement activities to providing customer service.
Organisational Culture is what differentiates your business, so it is important to know the various factors that contribute to your company’s culture. This way, you can create a culture that supports your overall business strategy and forwards long-term goals.
What contributes to the culture of an organisation?
Culture is established by the evolution of events and practices that occur within your organisation. Knowing what influences this can help you perpetuate a strong culture that will support your business strategy and enable you to achieve excellent results.
Some of the factors that contribute to Organisational Culture include:
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Leadership Style
This refers to how your company is being managed, as well as the degree of hierarchy structure, decision-making methods and the ways in which policies are enforced in an organisation.
- Mission, Vision and Values
What is the purpose of your business? What do your products and services stand for? The business’ mission, vision and values mirror your intentions, and these are important factors that inspire your employees.
- Work Environment
The kind of workplace you have defines how employees undertake their tasks and interact with their colleagues. It also has an impact on their concentration levels and mental health too.
- Communications
The way everyone communicates can influence employee-to-employee, employee-to-management and employee-to-clients relationships. It also demonstrates how people share information and show transparency.
- Orientation
Is your business people-oriented, task-oriented or function-oriented? Knowing the priorities of your business can help you either maintain or improve the existing culture in your workplace.
As you can see, a lot of factors affect your culture. Even those things you find completely ordinary can impact how your entire organisation behaves.
So, now that you know what influences Organisational Culture, let’s delve into how to approach and nurture it.
The impact of organisational culture on a business
Did you know that a large majority of leaders believe strong company culture is the key to business success?
This shouldn’t come as much of a surprise considering that Organisational Culture affects all facets of business – from the ways management implements rules and employees work, all the way to how people behave.
Organisational Culture also plays a significant role in supporting business strategy (for more, see here). Companies with a strong culture are more likely to have engaged employees who go the extra mile to execute strategies and advocate for the organisation’s objectives.
What is an organic approach to organisational culture?
An organic approach means that management takes more of an observational approach to culture development so that culture develops naturally over time, or that the culture of the organisation has not been considered at all.
While this sounds somewhat normal, there are serious limitations and risks involved with the organic growth of your culture because it’s left to take its own direction – and this may not be aligned with your organisation’s goals.
What is an active approach to organisational culture?
As the name suggests, an active approach to Organisational Culture means that management takes the lead in proactively defining and implementing the optimal culture.
This can involve leading by example, training sessions, consultant guidance and more. This is what our client Noor Bank decided to do by creating a Culture Squad under the direct supervision of the CEO
It’s important to remember that while Organisational Culture manifests over time on its own, taking a more active approach will help you strategically design it. With proper guidance on your part, you can shape it to benefit your employees, adapt to the current business landscape, provide better customer service and stand out from competitors. Keep in mind that the ideal Organisational Culture for your company is the one you actively design to support your business strategy, both in the short and long run.
What are the dangers of not taking an active approach to organisational culture?
Everyone in your company, regardless of position or role, can impact Organisational Culture. But if you are not paying enough attention to how your culture is developing and letting it evolve on its own, there’s a bigger risk that it will work against what you want to achieve as a business.
Here are some potential problems you may encounter with this approach:
- Issues that revolve around Organisational Culture will not be effectively addressed and resolved.
- There will be a gap between your optimal culture (the one you need) and the actual culture (the one you have)
- A culture without proper alignment can make your business disorganised by a lack of communication, create higher turnover and support poor customer relationships.
So, is your current Organisational Culture the perfect culture for your organisation?
Now might be the ideal time to evaluate. If you don’t measure your Organisational Culture, you can only guess what kind of a culture you actually have - and these assumptions are in our experience generally biased and inaccurate, preventing you from getting the most potential from your culture.
Remember that it’s never too late to have a more active approach and take necessary actions to improve your culture.
What role management plays in organisational culture
Top management needs to be actively involved. If top management is not involved in the project, it will generally fail to produce meaningful results.
Management’s role is to design the optimal culture according to the organisation’s core values and needs. The activities and initiatives you implement must also clearly reflect what your business represents to ensure that your Organisational Culture is on the right track to support your company’s success.
As the leader, it’s important to perform regular cultural assessments to determine inconsistencies and develop solutions that will address the needs of your organisation. It’s also critical to identify your ideal culture and share it with appropriate stakeholders so you can guide them, and they can play an active role in its development.
What role employees play in bridging the gap between actual and optimal culture?
Moving toward a culture that makes more sense for your organisation also lies in the hands of your employees. The people inside your organisation are paramount in transforming the overall company culture.
Here’s how they can make significant contributions:
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By being culture advocates – Employees must display your company’s culture in the way they relate to other workers, how they work themselves and how they represent the business to the outside world.
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By functioning as a team – Culture will only translate into success if everyone in the team is aligned with each other and united with a common purpose
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By being accountable – If employees take accountability for making the necessary changes to keep the Organisational Culture working for the benefit of the business, they will produce better and more lasting results.
Just remember that it’s essential to guide and measure the efforts to make sure that employees don’t inadvertently work against it.
Organisational Culture guides your business along the path of long-term growth and success by providing strategic competitive advantages and a productive environment.
When developed, this culture enables you to attract the right talent, boost engagement and improve retention. Most importantly, it can result in higher productivity which can generate greater returns for the business.
All you need to do is focus on effectively developing and sustaining the right culture for your company!
Let’s implement a more active approach to your organisational culture
Do you want to foster a strong Organisational Culture? At The Culture Factor Group we help you make this possible.
Our expert facilitators collaborate with you and your team to unlock meaningful insights, all backed by rigorous academic theory and data-driven analysis.
From consulting and training to certifications and tools, we enable you to achieve excellent results and realign your culture towards business success.
