Organizational culture: what it is, importance, how to implement, and examples
Organizational culture dictates the way employees perceive an organization.
Your organization has its own culture, an environment, or atmosphere that people feel in their workplace that is also related to its vision and goals.
When the culture is well defined, the company acquires several competitive advantages by starting with values rooted in each component of its teams. In this way, there is a coherent trajectory, which contributes to growth.
If you want to define, implement or improve your corporate culture, continue reading this article.
What is organizational culture?
Organizational culture is defined as a strategic resource. It is formed by a set of beliefs, values, and norms that influence the climate of a company. This corporate culture is important for organizations because it guides and aligns the behavior of employees and the way the company conducts its business. In this sense, it is important to define how your company positions itself and differentiates itself in the market.
For example, a cosmetics company that adopts a policy of not testing on animals includes this practice in its organizational culture. Even simpler norms, such as the existence or not of a dress code, are part of the set of practices that form the essence of the company.
A great challenge, in this sense, is to go from theory to practice. The desired values and behaviors are almost always described in organizational culture plans but are not always implemented on a day-to-day basis.
To use organizational culture as a competitive advantage, it is necessary to understand how it works, identify the types of culture present in the company, and promote changes to strengthen it.
The 4 types of organizational culture
There are different formats for classifying the types of corporate culture, considering the perspective of people management, hierarchy, and structure, among others.
To simplify this analysis, we have taken into consideration the view of one of the pioneers in the subject, researcher Charles Handy.
In 1976, Handy released the work “How to Understand Organizations,” defining his division of these entities into four types of culture, based on the channels of power they possess
- Power Culture
This is characterized by the centralization of power in the hands of the founder or CEO. From his insider’s view, the leader moves every department of the company.
- Culture of Roles
As the name suggests, it refers to a culture based on bureaucracy, in which rigid rules and processes that emphasize rationality prevail.
- Task Culture
It corresponds to a more flexible culture, centered on projects and results, and which allows for influence by the teams responsible for the work. It may refer to horizontal environments, where there is no hierarchy, and even to innovative structures such as the business model of startups.
- People Culture
Human capital is put first, prioritizing the well- eing and development of employees’ talents, considered essential to the company’s success. Benefits, career plans, and study incentives are some of the characteristics of companies that adopt this type of culture.
How is an organization’s culture created?
The organizational culture of a company can be analyzed from common essential points. In general, culture is born from the principles, beliefs, and values of the company’s founders and main leaders. So, the premise of leading by example is taken to the highest level when the subject is corporate culture.
Besides managers in higher positions, 5 other elements influence the formation of organizational culture:
Community: influences the company’s culture by interacting, providing, and acquiring the economic resources needed to run the company.
Customer: can modify the culture from their expectations regarding the quality of products/services and service.
Size of the organization: impacts the culture regarding delegation of power and responsibilities.
Legal nature of the owner: whether the company is public or private determines the levels of corporatism and the demand for efficiency.
Technological aspects: represent the materialization of some values regarding quality, employability, size of activities, etc.
Informal communication network: the name given to the day-to-day communication, usually done by the workers in the absence of the managers.
These characteristics are evaluated based on the reality of each company. Thus, there is no point in creating an organizational culture that has no identification with the identifiable characteristics within the company. This is an essential point: the corporate culture is the mirror of the company.
How important is organizational culture?
The organizational culture is the reflection of the values that the organization holds, guiding the paths to be followed and preparing the company for the future.
Another important point is the development of human resources. Because it is a moral and ethical alignment, culture demonstrates to employees what the company’s expectations are and how it should act.
The result is a healthier environment that promotes productivity since employees stop worrying about external issues and start dedicating their actions to the tasks to be developed.
Talent attraction and retention: A solid culture impacts the attraction of potential talent, decreasing retention efforts if professionals are hired effectively.
Self-management: Teams with a positive and strong organizational culture are more autonomous. Managers don’t need to repeat the implicit rules to exhaustion because everyone has already incorporated them and follows them.
Process simplification: When everyone incorporates the organizational culture, company processes become more streamlined, since everyone knows how to act and do their part.
Better organizational climate: A healthy and well-structured organizational culture makes the work environment better in many ways. Besides increasing the productivity of employees, it avoids coexistence and management problems, among others.
Customer satisfaction: Most customers understand when things are working well and when they are not. With organizational culture, everyone learns to manage and relate better! Naturally, when we like the relationship with a company, we want to do business with it again.
Organizational Culture: How to implement it in 5 steps
If you have reached this point, you are probably rethinking your corporate culture and the impacts it has on the company.
Note that even in organizations that have never developed this topic, there is a valid culture on a day-to-day basis, but it can be weak, uneven, and decentralized.
This means, for example, that different departments have built their customs, and possibly customers perceive there is a disruption in interactions with the company. It can also impact widespread employee dissatisfaction, as bad habits end up being tolerated due to the absence of strong leadership.
Regardless of the scenario that sparked the desire to change and implement a strong culture, know that transformation is possible as long as leaderships are willing to adapt the components of the corporate culture.
Check out these five steps to implement an organizational culture adapted to your company.
- Define your company’s values
What are the values that you want to take as a basis in your company?
If you want higher quality in relationships, products, and services, choose professionalism. If you value integrity, choose ethics as your value.
Do this exercise and point out the key elements that the company should institutionalize.
Then meet with a strategic team that will be the bearers of these values, taking responsibility for sharing them with other employees. If your company is smaller, invite everyone to this meeting.
- Share your values
Cultural values are the foundation of the relationship between your company and the world. So they deserve prominence in every meeting, event, presentation, and material used for company communication, whether internally or externally.
This is the way for employees and customers to understand, comprehend, and start relating the values to the company, acting according to these premises. This can be done with people management actions, joining communication tools, training, events, feedbacks, among other strategies.
- Invest in people
One practice to disseminate the company’s organizational culture is to invest in people. After all, they are the ones who are present in the daily routine of the business. Therefore, the culture must be accessible to everyone, regardless of position or area.
The performance of the leadership also has a strategic role. The company’s leaders have the mission to disseminate the organization’s values, motivate employees, provide feedback, among other tasks that contribute to strengthening the organizational culture among team members.
- Develop a communication culture
Communication will be essential in this process and can be applied in companies of different sizes, all that is needed is to adapt the strategy to the size and profile of the business. The use of banners or internal messages are simple strategies, but they become positive to transmit the company’s mission and values. The use of magazines, blogs, videos, internal chats, and other channels are also widely used strategies to achieve these goals.
In addition, by developing a culture of communication, the company facilitates the exchange of information and feedback between employees and managers. This contributes to the overall corporate environment and the climate of the organization.
- Improve the culture
As important as knowing your clients is knowing your employees. So don’t forget to monitor their perception of the company in the same way you monitor customer satisfaction.
Most of the time, periodic surveys, combined with lunches or coffees with employees are enough to gather feedback.
Whenever you identify negative trends, ask what can be improved and designate one or more people responsible for taking action.
Examples of a strong organizational culture
To understand, in practical terms, the importance of organizational culture, we will now address some renowned success stories.
Google is constantly used as a reference for people management in several startups and entrepreneurship events.
Google employees, who have been affectionately nicknamed Googlers, work in an informal and fun environment, which contrasts with most offices, with their impersonal architecture.
In this way, one of the most striking features of the company is to think about the workers’ well-being. In this sense, free meals, parties, trips, and prizes are offered, in addition to a series of benefits for employees. Everyone wins: the employees, by getting more advantages and quality of life, and the company, by having more productive professionals, which improves the organization’s results.
The social network is the largest on the planet. It is constantly pointed out the influence of the company’s organizational culture as one of the causes for business success.
The focus on teamwork and open communication has favored innovation and sustainable growth of the organization. As a strategy, leaders dialogue with employees more horizontally, leaving the top-down method aside, which contributes to greater understanding between both parties.
Starbucks
Starbucks is an American multinational company with the largest chain of coffee shops in the world. Its organizational culture is supported by two pillars: sustainability and community well-being.
This culture is so deeply rooted that some franchises often give discounts to customers who reuse their coffee cups. In addition, the stores are in the habit of promoting actions that alert and stimulate the environmental awareness of their employees and customers.
Apple
Apple is one of the most successful technology companies of all time. Over the years, the company has created a strong organizational culture, in which the focus is on the creativity and autonomy of employees in developing their activities. With this premise, the freedom of professionals to develop their work has been increased, which has generated more creative and innovative solutions for the company.
Netflix
In 2009, one of the founders of the organization drafted a manifesto, in which he highlights the foundations of the company’s organizational culture.
This culture was titled “Netflix Culture: Freedom and Responsibility”. As the name suggests, it is based on the principles of freedom for employees, if their responsibilities to the company are respected.
Furthermore, the document advocates the role of maintaining flexible behaviors and processes as a solution to avoid unnecessary expenses generated by a broad control system.
We hope this article has cleared up your main doubts! Follow our blog to stay up to date with all our tips and news.
Newsletter!
Subscribe to our newsletter and receive weekly updates, with the bonus of a different ebook every month!