The Future of Organizational Culture
In this guest blog, Maxine Harris, PhD takes an interesting look at organizational cultures and how they can affect both how a company appears to its customers and how well it succeeds.
by Maxine Harris, PhD
Just what is organizational culture? We know that it is made up of multiple factors as variable as company mission and core values to how people collaborate on the job and go about their daily lives. But one thing for is sure, we feel it just as soon as we walk in the front door. Take for example how people dress for work. In organization A, all employees are expected to wear a suit and tie to work. This suggests that the organization is formal and promotes conformity. Now consider organization B, people are told that they can dress however they like as long as they do not offend colleagues or customers. This organization favors individuality and originality. And finally, we have organization C where everyone wears a company polo shirt with the business logo neatly stitched on the front of the shirt. This style of dress says we are casual, but conforming. Something as simple as how you dress for work says volumes about organizational culture!
What factors define culture and why does it matter? Here are some of the elements that determine culture and some of the reasons why organizations should pay attention.
What contributes to organizational culture?
Mission speaks to the raison d’etre of an organization. In other words, why does it exist? For most non-profit agencies, the mission is often to fulfill a lofty goal: house the homeless; find shelter for abandoned animals; promote clean energy. And people who come to work for the organization share that mission and work hard, often many hours a day, to promote what they believe is a worthy cause.
The culture is far different when the mission is to make as much money as possible and to build the company so that it can be bought out by a bigger business.
2. Values Stated vs Real:
Every organization has a set of stated values, and they are often much the same: treat employees and customers with respect, act with integrity, promote teamwork, and encourage transparent communication. These stated values may mask or be coupled with another set of values however. Values such as promote creative rather than compliant employees; compete with other organizations and strive to be number one in your field; and do not share information with colleagues in order to give yourself a competitive edge.
You can see how very different these two sets of values are. You might prefer one over the other and that is fine as long as that preference is clear and employees can see it in the decisions made by the organization. A culture of confusion and discomfort is created however, when organizations espouse one set of values and live by quite a different one.
3. Organizational Structure:
In some organizations, power clearly flows from the top down. An organizational chart, often with many layers, is available for everyone to see. The boss sits in the big office in the C-suite and is generally inaccessible to line staff and lower level departmental heads. Even though chiefs gather input from their staff members, decisions, especially big, strategic decisions, are made by a small executive team and approved by the Board of Directors.
Now consider an organization with a flat structure. Although there is an executive officer, input from all staff members, new hires to program directors is welcome. Such an organization might have routine focus groups to solicit ideas and open forums where agency plans can be discussed. Generally, in organizations without a hierarchical structure, employees call one another by first names, doors are open, and “everyone drinks from the same coffee pot.”
4. A Preference for Task Completion Over Autonomy and Risk-Taking:
Some organizations promote a culture in which the completion of a task in a consistent and uniform way is critical. In a fast food restaurant, for example, each employee makes the same hamburger in exactly the same way. Customers buy uniformity and consistency, and as a result, the uniqueness of the individual employee is irrelevant to the production of the product. Like workers on an assembly line one worker can be replaced by another without a glitch.
Now imagine a start-up business. The emphasis is on creative people willing to take risks and do things differently. In fact, failure is often taken as a “lesson learned” rather than as a mistake. Each lesson gives employees ideas for how to explore another possibility. Now obviously creative environments still need to get work done, but the rewards go to those who can use their ingenuity to “make a better hamburger.”
5. Whole Person Emphasis:
Some organizations make a point of seeing employees as whole people who need more than a paycheck and a place to work. Employees have opportunities for more than supervision; they are actively mentored. Supervisors care about their career and professional goals and provide opportunities for new learning experiences. It is not uncommon for supervisors working in “whole person” cultures to ask employees what they need to take the next step in their careers. Such organizations might even provide tuition assistance for employees wanting to go back to school for more training.
When organizations pay attention to the whole person, they might also provide employees with opportunities and time for self-care. Helping employees balance time between work and family is also part of the culture in organizations that attend to the whole person.
Compare this to the office where each person is seen as an employee and nothing more. As long as the job gets done, it is up to the employee to figure out future goals, to acquire new skills, and to manage dealing with a work life and personal priorities. Management takes a very limited view of just who the employee is.
6. Location, Layout and Size of the Organization:
The physical location or the organization, how the workspace is configured, and how large the agency is all contribute to the culture. What are called “architectural” features all make a difference.
Consider an organization located in the center of the city, close to transportation lines and within easy access of restaurants and a variety of retail outlets. Now take that same organization and move it to a marginal neighborhood with few amenities and no easy access to transportation or safe parking. A once open and relaxed organization becomes isolated and insulated. This external variable, location, becomes a salient factor in determining the organizational culture.
The layout of work space can play an important role. There is a recent emphasis on open work space rather than more traditional closed and separate offices. In an open “fishbowl” arrangement, employees share a central space, and walk around freely, frequently engaging in spontaneous conversations. The belief is that such a spatial arrangement promotes collegiality and team building, and expands the possibilities for creative, cross-discipline innovation. Compare that to a layout that encourages workers to get the job done in small separate offices. In some extreme cases, workers even sit in darkened offices to minimize computer glare. And then there are those employees who work from home and may only know colleagues by their e-mail addresses. Without issuing a value judgment, one can easily see how these contrasts in work space would easily affect the culture of an organization.
And finally, the size of an organization makes a difference. Big organizations are more likely to exhibit a culture of isolation, anonymity and in some cases loneliness. By contrast very small organizations can be more family-like, but also more gossipy. As with the beds in the Goldilocks fairytale, “some beds are too small, some are too big, and some are just right.” It all depends on what effect you want to achieve.
7. The History and Identity of the Organization:
Even if it is at the beginning of its journey, every organization has an identity, and that identity resonates both inside and outside the organization. When organizations have been around for a long time, their identity often reflects their history and their story of successes and failures.
Why does organizational culture matter?
It’s one thing to understand the variables that go into the development of an organizational culture, but it’s quite another to answer the question “Just why does organizational culture matter?” And there are several answers to that question.
1. It Impacts Hiring Decisions:
When employers understand the culture of their organizations, they are better equipped to hire people who will “fit in.” Match between organizational culture and employee style is as important when making hiring decisions as is the skill set of the perspective employee. For example, take the case of the modest and somewhat shy employee and put that person in an organization that emphasizes a high level of relational contact among staff members. The shy employee might feel like an outlier and dread coming to work, not because she/he can’t do the job, but because they don’t mesh with the prevailing culture.
2. It Impacts Employee Retention:
It is not surprising that employees who don’t fit well with organizational culture will not stay long at their job. Businesses spend a lot of time trying to solve the problem of staff turnover. It costs resources, both financial and personal, when a staff member leaves after a relatively short tenure. Department heads and HR specialists try a range of techniques to limit turnover: everything from more supervision and additional training to moving the unhappy employee to a different department. But the answer to the dilemma may mean looking in another direction. People leave jobs when the organizational culture just doesn’t fit with their personal style. It often saves time and energy on all fronts when prospective hires have a chance to go through the routine of a day with an experienced employee and get a “feel” for what it would be like to work there. Simplistic as it may sound, a prospective employee may get more information from sitting in the waiting room and watching how people interact than you do during the actual job interview!
3. It Affects Productivity:
Organizational culture affects how hard people work. If the boss goes home before five and people enjoy time having a long lunch, the message within the organization is clear. Work is a place where you do a job, but you also relax and don’t push yourself too hard. When that kind of culture is established, employees may grumble when they are asked to put in extra time to finish a project, not because they are lazy or they don’t care, but because that just is not the norm within the organization.
4. It Affects Employee Morale:
Regardless of the type of business you are running, a mission-driven non-profit, or an ambitious start-up, or an established concern, all employers want their employees to be happy. Walk down the corridor in your office and count how many times you hear people laughing. Feeling that you have the freedom and the comfort and the camaraderie to laugh may be the best indicator of how happy employees are. And when employees are happy, they work harder; they cooperate more, and they feel better about their jobs.
A final word about organizational culture. Not everyone likes to work in the same kind of company. Some like a more formal style and others prefer a more casual environment. No one culture is better than another. But match between the preferences of individuals and the overall culture of the organization can make all the difference in how well the business runs.
Maxine Harris, PhD is the co-author of Lessons for Non-Profit and Start-Up Leaders: Tales from a Reluctant CEO, and CEO of Community Connections, a large social service organization in Washington, DC. For more information, please visit www.communityconnectionsdc.org.
Views expressed in the blog are those of the author and do not necessarily reflect the views of GreenSky, LLC, its management or subsidiary companies.