Category Archives: Organizational Culture

Questions to Guide You in Understanding Your Organizational Culture

When the discussion turns to “organizational culture”, or “corporate culture”, most people have some sense or recognition of what the concept means, at least to them.  A fairly simply definition, or explanation, is “the way we do things around here”.  However, not surprisingly, there is no generally accepted definition of “culture”, organizational or otherwise, and scholars and researchers from various academic disciplines have added their own nuances when suggesting a definition of culture. For example, experts in management science and organizational behavior and communication see organizational culture as an explicit product of the choices that a group of people makes with respect to accepted behavior as they interact with one another and key stakeholders outside of the organization (e.g., customers, suppliers and regulators) and attempt to develop ways to confront their broader social environment.  In the “business context”, the organizational culture is an important determinant of how members deal with customers; how members treat one another as fellow members; and how leaders and managers of the organization motivate, reward and develop members.

This article is adapted from material in Organizational Culture: A Handbook for Sustainable Entrepreneurs, which is prepared and distributed by the Sustainable Entrepreneurship Project and can be downloaded here.

A lot has been written about “why organizational culture matters” and dozens of consultants have developed sophisticated tools for measuring and profiling organizational cultures so executive and managers can launch “change initiatives”, even though there is some skepticism about just how easy it is to change an organizational culture.  If you don’t have the time for a fancy assessment, perhaps you can benefit from going through a series of questions that we’ve developed after an extensive review of the models for empirically measuring organizational culture along various bipolar scales, which are referred to as “dimensions”.  Some of these models are prescriptive and come with data claiming to indicate that certain cultures are more “effective” than others in achieving various desired indicators of performance, such as profitability, productivity and customer satisfaction. For example, it has been suggested that organizations should strive for “adaptability” and focus on “listening to the marketplace” in order to identify appropriate changes to their behaviors and processes that will make them more responsive to customer needs.  The challenge for organizational leaders, both executives and managers, is to develop a list of questions and categories that can be used to identify key issues associated with “organizational culture” so that they can be explored and actions can be taken to either strengthen and reinforce desired cultural characteristics or initiate changes that will hopefully lead to greater member satisfaction and enhanced organizational performance.  To get you started, here’s the list we put together:

  • Organizational Mission and Purpose: Do all of the organizational members have a clear understanding of the mission and purpose of the organization and their roles and responsibilities in achieving organizational goals? Is there a clear vision of where the organization is headed that is shared and understood by all members?
  • Control Systems: What “control” mechanisms are used within the organization and are they “tight” (e.g., formal rules with small tolerances) or “loose”? To what extent does the technology used by the organization influence its control systems?
  • Organizational Responsibilities to Members: What is the accepted and expected scope of the organization’s responsibilities toward its members? Are those responsibilities limited to matters directly influencing job performance or do they extend further to include responsibilities for the overall well-being of organizational members (i.e., a more “humane orientation”)? What is the perceived (and actual) role of the organizational leader in the lives of subordinates?
  • Organizational Identification and Commitment: Do organizational members have a strong level of identity with, and commitment to, the organization or is their level of commitment divided between the organization and other strong group affiliations, such as allegiances to professional cultures (e.g., science and engineering)?
  • Communication Style: What styles are used by organizational members for internal and external communications (e.g., assertive/aggressive versus cordial/tender) and how easy is it for outsiders and newcomers, such as new employees, to be admitted and integrated into the organization? Communication also includes the effectiveness of communication and the degree to which accurate information is shared throughout the organization.
  • Internal Governance Systems: Has the organization developed an internal set of governance systems that contribute to a continuous sense of integration and coordination among organizational members? These systems include core values and established norms, rituals, rules and standardized procedures to avoid uncertainty, reduce ambiguity and help everyone in making consistent decisions and behaving in a consistent manner.
  • Strategies for Coping with External Environment: Is the organization pragmatic (i.e., flexible and adaptable) in dealing with its external environment, particularly its customers (i.e., a “customer orientation”), or is the approach more rigid? To what extent do organizational members expect that it is possible to change and manage the relationship of the organization with its external environment in order to advance and achieve organizational goals and objectives (i.e., is it believed that the organization can “master” its environment through detailed planning processes or should it simply accept the environment as it comes and strive for “harmony” with it)?
  • External Adaptation: What is the level of results- and outcome-orientation (i.e., quality and efficiency) within the organization? Does the organizational culture emphasize customer satisfaction and continuous innovation to meet the changing demands of the marketplace?
  • Power, Status and Participation: What are the expectations of organizational members regarding the distribution of power and status within the organization and opportunities for all members to participate in decision making regarding organizational goals and objective? Organizations with higher “power distance” are more hierarchical, accepting more stratification among members with regard to power and wealth and more authoritarianism with respect to decision making, while organizations with lower power distance are more egalitarian and deploy flatter organizational structures.
  • Individualism/Collectivism: What is the relative importance of individual accomplishment or autonomy versus group dependent accomplishment within the organization? This can be measured by looking to see how important team and group activities are in the organizational structure and processes, how rewards are allocated to members of the organization for their actions and the extent to which people work well together and help each other with difficulties.
  • Gender Equality and Diversity: To what extent do organizational leaders and organizational practices promote gender equality and minimization of gender role differences? Do all of the various employment-related practices within the organization reflect acceptance of diversity and valuing of all people regardless of race, gender, sexual orientation, religion and age?
  • Time Orientation: What balance does the organization strike, particularly in its reward systems, between future oriented behaviors, such as planning and long-term investment, and short-term planning and projects?
  • Encouragement and Support of Individual Development: To what extent does the organization encourage and reward members for improving their skills and performance and for setting and achieving challenging goals with respect to excellence and quality? Factors to consider include the level of training offered to organizational members, acceptance and encouragement of “entrepreneurship” and “reasonable risk taking” in areas such as product and process development, respect for individual dignity and provisions of a good and safe working environment.

Admittedly, a lengthy list of questions is somewhat daunting and it is sometimes simpler and quicker to ask organizational members how they would place the organization within broad categories such as a “personal” culture (i.e., does the workplace feel and act “like a family”); an “entrepreneurial and risk-taking” culture, such as the atmosphere commonly found in new firms targeting innovations in technology; a “competitive and achievement-oriented” culture; or a “controlled and structured” culture.  An alternative list of categories that would appear to be readily identifiable and understandable to respondents would include people orientation (supportiveness), innovation, competitiveness/aggressiveness, performance (outcome) orientation, stability, team orientation, detail orientation, emphasis on rewards and social responsibility.

One encouraging note in an increasingly global economy is that new research appears to support the proposition that many of the dimensions of organizational culture underlying the list above can be effectively used and measured in a variety of national settings.  For example, organizational culture in China has been reliably measured and described using a mix of internal integration and external adaptation values that would be familiar to analysts of organizational culture in the West; however, it is still necessary to “localize” the items associated with each of these values in order to obtain results that are meaningful for organizational managers interested in changing aspects of the organizational culture to improve economic performance and/or member morale or smoothing the process of integrating members of two organizations from different countries who are brought together through merger.

This article is adapted from material in Organizational Culture: A Handbook for Sustainable Entrepreneurs, which is prepared and distributed by the Sustainable Entrepreneurship Project and can be downloaded here.

Alan Gutterman is the Founding Director of the Sustainable Entrepreneurship Project, which engages in and promotes research, education and training activities relating to entrepreneurial ventures launched with the aspiration to create sustainable enterprises that achieve significant growth in scale and value creation through the development of innovative products or services which form the basis for a successful international business.  Visit the Project’s Library of Resources for Sustainable Entrepreneurs to download handbooks, guides, articles and other materials relating to sustainable entrepreneurship and keep up with the Project’s activities by following Alan on LinkedInTwitter and Facebook.

Corporate Sustainability and Organizational Culture

“… findings suggest that the successful implementation of culture change for corporate sustainability might be largely dependent on the values and ideological underpinnings of an organization’s culture, and that these in turn affect how corporate sustainability is implemented and the types of outcomes that can be observed.”

Linnenluecke and Griffiths were interested in examining the relationship between corporate sustainability and organizational culture.  They observed that organizational culture had often been cited as the primary reason for the failure of implementing organizational change programs, and explained that regardless of the sophistication of the tools, techniques and change strategies used by an organization, change programs are most likely to succeed when they are aligned with the values and ideological underpinnings of an organization’s culture.  They believed that organizational culture impacts how corporate sustainability is implemented and predicts the types of outcomes that may be observed by introducing various change strategies into the organization.

In order to test these propositions, Linnenluecke and Griffith set out to explore and discuss the relationship between corporate sustainability and organizational culture using the “competing values” framework of organizational culture that has been used to identify and describe the following four types of organizational culture, each with its own set of valued outcomes and a coherent managerial ideology about how those outcomes could be achieved:

  • Human Relations Model: Organizations that are dominated by human relation values promote cohesion and morale through training and development, open communication and participative decision-making
  • Open Systems Model: Organizations that are dominated by open systems values promote growth and resource acquisition through adaptability and change, visionary communication and flexible decision-making
  • Internal Process Model: Organizations that are dominated by internal process values promote stability and control through information management, precise communication and data-based decision making
  • Rational Goal Model: Organizations that are dominated by rational goal values promote efficiency and productivity through goal-setting and planning, instructional communication and centralized decision-making

Linnenluecke and Griffith put forward the following theoretical propositions with respect to each of the four cultural types with respect to how the ideological underpinnings of the applicable organizational culture were likely to influence how sustainability will be implemented and the outcomes that can be achieved from the sustainability initiatives:

Human Relations Model: Organizations dominated by the Human Relations Model, with its emphasis on social interaction and interpersonal relations, rely more heavily on internal staff development, learning and capacity building in their pursuit of corporate sustainability.  Organizations with a strong focus on social or human relations values are likely to support or attract social entrepreneurship and leaders of these organizations will likely invest significant time and energy, often at the expense of neglecting business goals and objectives, in advocating corporate sustainability principles within the organization.  The challenge for pursuing sustainability within organizations with an embedded Human Relations Model will be resolving the tensions between creating a business venture and pursuing a social purpose.

Open Systems Model: Organizations dominated by the Open Systems Model place greater emphasis on innovation for achieving ecological and social sustainability as they pursued corporate sustainability.  In this instance, innovation is applied not merely to attain higher levels of eco-efficiency, but rather to develop products, systems and practices that “move beyond pollution control or prevention and allow the organization to operate within the carrying capacity of the natural environment by minimizing their resource use and ecological footprint”. As for social sustainability, the assumption is that the organization must recognize and embrace its responsibilities toward various stakeholder groups and the community in which they operate.

Internal Process Model:  Organizations dominated by the Internal Process Model have a preference for pursuing economic sustainability and thus place greater emphasis on economic performance, growth and long-term profitability in their sustainability initiatives.  The key aspects of this approach would be maximizing production and consumption of the organization’s products and services in order to increase profits and achieving economic efficiency through the simplification of products, services and processes in order to achieve costs reductions, maximize product and pursue economic outcomes; however, realization of economic sustainability (i.e., the maximization of profits, production and consumption) alone is not sufficient for the overall sustainability of corporations.

Rational Goal Model:  Organizations dominated by the Rational Goal Model emphasize resource efficiencies in their pursuit of corporate sustainability.  There is no doubt that there are operational and sustainability advantages to implementing policies and practices that reduce costs and operational efficiencies and many organizations have implemented human resources and environmental policies focused on reducing and eliminating waste; however, efficiency should not be pursued in isolation, since it is also necessary to consider the impact that the steps taken to achieve efficiency may have on the environment and society.  Moreover, efficiencies may be of limited competitive advantage to organizations if they can be easily copied and implemented by competitors.

The propositions for each of the cultural types championed by Linnenluecke and Griffith are important for sustainability leaders in the way they serve as reminders that there is no single best type of sustainability-oriented organizational culture and that organizational culture is best viewed as a fundamental influencer on how corporate sustainability is implemented and the types of outcomes that can be expected.  Can sustainability leaders make the changes in organizational culture necessary to facilitate a shift toward different sustainability-related ends?  Organizational rigidity and multiple subcultures make the task more difficult; however, Linnenluecke and Griffith suggested that certain changes can be made to the elements of an organization’s observable culture (i.e., at the surface level) to provide a conducive context for the changes in the values, beliefs and core assumptions of organizational members necessary to pursue sustainability: publication of corporate sustainability reports, the integration of sustainability measures in employee performance evaluation, and employee training.

Sources: A detailed discussion of the article appears in the chapter on “Organizational Culture and Sustainability” in “Organizational Culture: A Library of Resources for Sustainable Entrepreneurs” prepared and distributed by the Sustainable Entrepreneurship Project (www.seproject.org) and available for download here, and the article itself can be found at M. Linnenluecke and A. Griffiths, “Corporate sustainability and organizational culture”, Journal of World Business, 45 (2010), 357.  For further discussion and description of the competing values framework of organizational culture, see R. Quinn, Beyond rational management: Mastering the paradoxes and competing demands of high performance (San Francisco, CA: Jossey-Bass, 1988); R. Quinn and J. Kimberly, “Paradox, planning, and perseverance: Guidelines for managerial practice” in J. Kimberly and R. Quinn (Eds.), Managing organizational translations (Homewood, IL: Dow Jones-Irwin, 1984), 295; and R. Quinn and J. Rohrbaugh, “A spatial model of effectiveness criteria: Towards a competing values approach to organizational analysis”, Management Science, 29(3) (1983), 363.  See also the chapters on “Dimensions of Organizational Culture” and “Typologies of Organizational Culture” in Organizational Culture: A Library of Resources for Sustainable Entrepreneurs, which is prepared and distributed by the Sustainable Entrepreneurship Project (www.seproject.org).

 

 

Identifying Person-Organization Fit

The Organizational Culture Profile (“OCP”) developed by O’Reilly et al. and subsequently refined by others has become a widely recognized and used tool for assessing “person-organization” fit.  The OCP originally used a typology of dimensions of organizational culture that included innovation, stability, people-orientation, outcome-orientation, aggressiveness, detail-orientation and team-orientation.  Each of these dimensions was associated with various “characteristics” that could be used in surveys and questionnaires to develop profiles of organizational members as well as the entire organization and specific groups within the organization.  Examples of characteristics included “adaptability”, “being innovative”, “being rule oriented” “fairness”, “tolerance”, “informality”, “decisiveness”, and “achievement oriented”.

 Handler provided a clear and simple explanation of the process of using the OCP to measure person-organization fit:

  • A baseline for the organization’s culture is established by having a representative sample of the organizational members provide their opinions on which of the dimensions is most and least representative of the organization.  The baseline is established by aggregating the ratings provided by the survey participants.  At this stage participants should be reminded to focus on “how the organization is” as opposed to how they would prefer it to be or their own personal preferences as to the cultural environment in which they would like to work.
  • Organizational members create their own personal value profiles by ranking each of the characteristics referred to above from most preferred for their work environment to least preferred.  This is the stage where participants need to visualize their ideal situation and avoid speculating as to whether it would be possible for the organization to deliver all of the characteristics they would prefer.  Realizing there are a large number of characteristics, respondents should be urged to focus primarily on the three to five items that are “most characteristic” and “least characteristic” and not spend too much time sorting out the others that fall into the middle.
  • The personal value profiles of the organizational members are compared to the profile of the baseline organizational culture constructed in the first stage and the overlap between the organizational culture and a member’s personal values or preferences provides a data-based estimate of the person-organization fit for the member.

Handler conceded that the approach outlined above is relatively “soft” and somewhat subjective and thus may not pick up harder and more objective aspects of performing a particular job; however, Handler argued that the OCP and the concept of person-organization fit (“P-O Fit”) can provide value to organizations and their leaders and members.  For example, research has shown that good P-O Fit increases tenure and reduces the costs of turnover. In addition, P-O Fit has been linked to increased worker satisfaction, organizational commitment and organizational identification.  P-O Fit can also be used as a tool for selecting the best candidates for work groups and teams and determining whether a member would do well if he or she is transferred to a new area within the organization.  Handler noted that there are often a large number of groups within an organization and that groups may have values that differ from other groups that can and should be profiled to determine whether a particular member would fit well within that group.  Finally, the output from the OCP survey can be used to develop an “employment brand” for the organization that can serve as a recruiting tool and the basis for messaging to job candidates regarding the values and practices of the organization with respect to its members.

Sources for this post included C. O’Reilly, J. Chatman and D. Caldwell, “People and organizational culture: A profile comparison approach to person-organization fit”, Academy of Management Journal, 34 (1991), 487; D. Cable and T. Judge, “Interviewers’ perceptions of person-organization fit and organizational selection decisions”, Journal of Applied Psychology, 82 (1997), 546 (see here for an illustration of a worksheet to be completed by an organizational member to determine his or her personal values profile); and C. Handler, The Value of Person-Organization Fit, Building an Interview (Website).  To learn more see the materials on Organizational Culture at the website of the Growth-Oriented Entrepreneurship Project.

A Configuration Model of Organizational Culture

With so many definitions it often seems difficult to get a good handle on organizational culture so that it can identified, measured and compared, all things that are of great interest to organizational leaders searching for positive links between organizational culture and performance.  Perhaps the most well-known model of organizational culture, although not necessarily the most complete, is the three level framework developed by Schein.  He began with a definition of “culture” as “a pattern of basic assumptions – invented, discovered or developed by a given group as it learns to cope with problems of external adaptation and internal integration – that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems”.  He then fleshed out this definition by suggesting that culture could be understood by dividing it into three domains or levels, as follows: 

  • Artifacts and Creations:  This level, sometimes referred to as “cultural forms”, includes the tangible behavior patterns that are repeatedly seen within an organization and the visible artifacts that serve as widely-recognized manifestations of the cultural values and norms of the organization: structure, facilities, the physical layout of work spaces (e.g., segregation of offices of senior executives so that they are not easily accessible by rank-and-file employees), furnishings, dress codes, rights and rituals, myths and stories, symbols, language, gestures, visible rewards (i.e., perquisites provided to senior executives and/or other identifiable groups of employees), the level of technology used within the organization and where the technology is deployed, and how members of the organization appear to interact with one another and with outsiders who come in contact with the organization. 
  • Espoused Values: This level includes things such as organizational slogans and other visible expressions of organizational mission, vision and internal and personal values (e.g., identifiable norms and formal guidelines).  Espoused values describe the desired state or outcome that the leaders of the organization wish to achieve through the activities of the members of the organization and are thought to have an important influence on how decisions are made within the organization and the level of risk that the organization is willing to undertake. 
  • Basic Assumptions: This level includes the organization’s tacit core beliefs and assumptions that each member relies on when interpreting and acting upon the organization's values and selecting the behavior that they believe would be appropriate from the organization's cultural perspective.  This level is definitely the most difficult to assess since the elements of culture at this level are invisible and generally exist without the awareness of members.  These unconscious rules form the basis for norms of behavior and standards of conduct that become deeply embedded through day-to-day interactions of members that serve as a reinforcement mechanism.

Schein’s three domains made for a nice visual; however, the model left many questions unanswered.  For example, while one can easily see artifacts and creations that does not necessarily mean that one can understand why they exist and what their purpose and importance within the organization might be.  As for the espoused values, the challenge is learning more about why values such as “risk taking” are acceptable in one organization but not in another.  Finally, understanding the basic assumptions is necessarily very difficult given that they lack tangibility and even organizational members have problems explaining what they are and how they came about.  This is a fundamental challenge for those attempting to understand, manage and change organizational culture since Schein himself concluded that: “What really drives the culture – its essence – are the learned, shared, tacit assumptions on which people base their daily behaviors”.  While it is generally assumed that Schein’s model represents a pattern of relationships in which unobservable assumptions influence visible behaviors through rules, prohibitions and standards, the reality is that the model is quite abstract and substitutes complexity reduction for substantive explanatory value.

Dauber et al. reviewed the models of organizational culture offered by Schein and others and concluded they provided little more than “a simplified but limited perspective on culture in organizations . . . due to the high level of abstraction, which confines the explanatory power regarding interdependencies between organizational culture and other domains of an organization (e.g., strategy, structure, operations, etc.)”.  Dauber et al. aspired to create a comprehensive “configuration model of organizational culture” that provided a better understanding of the development of the “internal environment” of an organization, which was the focus of the Schein model, but also took into account pressures and influences on organizational culture from the external environment and the consequences of organizational activities for that environment.  In their view, such a model should incorporate the following domains:

  • A “value and belief system” that included all of the underlying assumptions among organizational members relating to organizational behavior;
  • The “strategy” of the organization that represented the overall orientation of the organization toward task achievement and which impacted the structures and activities of the organization;
  • The “structural system” that reflected the manifestation of the elements of the organization’s value and belief system as norms, rules, and regulations and which served as a frame of reference for organizational processes and patterns of behavior which stood in line with a predefined organizational strategy;
  • The “organizational activities, operations and actions” that were the patterns of behavior within the organization that can served as an observable manifestation of the value and belief system, strategy and structural system; and
  • The “external environment” which served as an influential factor through evaluation processes on the organizational culture and on the larger internal environment of the organization.

The configuration model of organizational culture proposed by Dauber et al. included both an internal and external environment, a formulation that followed from the fact that organizations are embedded in various contexts outside of organization itself such as societies and markets.  They explained the four domains in the internal environment of their model as follows:

  • Organizational culture, which borrowed from the model developed by Schein and included the underlying and unobservable assumptions which serve as the basis for every organization.
  • Organizational strategy, which was defined as the overall orientation of an organization for seeking and achieving preset goals and objectives (i.e., a long-term plan for maximizing profits or, in the case of non-profit organizations, covering costs).
  • Organizational structure, which was the manifestation of the organizational strategy and the processes (i.e., rules, procedures and appraisal/reward systems) used to regulate information flows, decision making and overall patterns of behavior within the organization.
  • Operations, which included the behaviors which occurred within the organization during the process of operationalizing the organizational strategy.  Operations could either be “inward-oriented”, meaning they were oriented toward the internal environment, or “outward-oriented”, meaning they were oriented toward the external environment.

The external environment included in the Dauber et al. model was intended to incorporate “all elements outside the boundary of the organization to which an organization needs to adapt” and assumed a dynamic relationship in which organizations were continuously confronted with needs and opportunities for change in order to respond to rapid changes in their external environment.  Dauber et al. identified two different and distinguishable external environments to which organizations were “fundamentally linked”.  They called the first one the “legitimization environment” and explained that it included all of the stakeholders who legitimized the organization and to which the organization needed to justify the operations conducted in its internal environment: customers, shareholders, employees, suppliers, regulators and society as a whole.  With regard to “societal culture”, Dauber et al. argued that it influenced organizational culture in two important ways: through societal pressure from the external environment and through the personal perceptions of societal values employees brought to their roles within the organization.  The second external environment was identified as the “task environment”, which included the environmental context (e.g., markets) for the activities and tasks associated with the pursuit of the organizational strategy.

In their model Dauber et al. emphasized several linkages between the two types of external environments and the “operations” domain of the internal environment.  Dauber et al. identified two processes that linked the legitimization environment to the organization: “pressure of legitimization” and “legitimization management”.  Pressure of legitimization refers to pressure originating from societal culture for the organization “to operate in line with societal values to be accepted as a member of society”.  Legitimization management includes lobbying activities (i.e., attempts to influence regulating institutions) and activities intended to positively influence public opinion regarding the organization.  The two links between the task environment and operations were the actions taken during the course of operationalization through the organizational structures and “market feedback” generated by operationalization that could be used to identify and make changes in the various domains of the internal environment.

The sources for this post included E. Schein, The Corporate Culture Survival Guide (San Francisco, CA: Jossey-Bass, 1999); and D. Dauber, G. Fink and M. Yolles, “A Configuration Model of Organizational Culture”, SAGE Open 2012, Originally Published on 22 March 2012, http://sgo.sagepub.com/content/2/1/2158244012441482, 4.

Managing Organizational Culture

Organizational culture includes a large and complex set of elements, many that are difficult to identify, such as values, norms and cultural forms, and these elements can be found embedded across all organizational activities and practices (e.g., direction and control processes, reward systems, communication patterns etc.).  The organizational founders and other original members of the organization play an important role in establishing the foundations of an enduring organizational culture; however, organizational culture is also influenced by continuously changing external factors outside of the control of the founding group and by new members who join the organization as time goes by.   While the complex nature of organizational culture makes it difficult to “manage”, the importance of culture to the performance and success of the organization means that attention should and must be paid to how culture is passed on and reinforced within the organization and when and how changes in the culture must be introduced in order to cope with changes in the external environment, new types of work activities and different expectations and needs of organizational members. 

The International Center for Growth-Oriented Entrepreneurship has just released a chapter on "Managing Organizational Culture" from its Library of Resources for Growth-Oriented Entrepreneurs on Organizational Culture which is available for free downloading and sharing by clicking here.  Also, take a look at the Center's article on LinkedIn Pulse discussing important ideas for managing your organizational culture.

Introduction to Organizational Culture

A number of definitions of organizational culture have been offered; however, if managers and employees are consulted they may simply respond that culture is “how we do things around here”.  There is obviously truth to such a statement but it would be a mistake to ignore the breadth and scope of the issues that are influenced by an organization’s cultural norms and values—how activities within the organization are carried out, how members communicate with one another, who is accepted into the organization and who is ostracized, and what is the organization’s overall morale.  The culture of a particular organization is created and maintained by its members, particularly the founders and senior managers, based on a variety of influencing factors—both external and internal—and they are also the ones who can change and transform the culture when they are convinced that such actions are necessary in light of the then-current environment that the organization is facing.  Organizational culture should not be underestimated and research has indicated that the culture of an organization has a strong influence on how the organization tackles problems and questions, sets strategy and creates the structures that determine the work activities and relationships of organizational members and also on how members behave when carrying out their organizational activities.  There is no single culture that is universally appropriate for all organizations and there is clearly substantial diversity with respect to the dominant cultural attributes among successful and effective organizations.  The challenge is to construct a culture that fits well with the overall strategic goals and objectives of the organization and hopefully becomes a core competency for the organization and can be used to distinguish it from competitors in the minds of customers and prospective members. 

The International Center for Growth-Oriented Entrepreneurship has just released a chapter on "Introduction to Organizational Culture" from its Library of Resources for Growth-Oriented Entrepreneurs on Organizational Culture which is available for free downloading and sharing by clicking here.   Also, take a look at the Center's article on LinkedIn Pulse discussing important things you need to know about organizational culture.

Work-Life Balance Programs: Challenges and Opportunities

In an op-ed article appearing in The New York Times in August 2015 Weisberg discussed a “new raft of ‘perks’” announced with great fanfare by private equity firms and well-known businesses such as IBM, Facebook and Apple that have been framed as an effort to accommodate the needs of working mothers and women who want to be mothers and maintain their fast-paced career paths.  Working women with newborns now have opportunities to have their companies pay for both their baby and a nanny to tag along on business trips during the first year after the baby is born and companies are also willing to ship home breast milk pumped on a work-related junket.  Companies have also implemented programs for reimbursement of costs incurred by employees who want to freeze their eggs so that they concentrate on their jobs but keep open the option of getting pregnant in the future.

While Weisberg conceded that progress has been made on providing support for working mothers, she pointed out that while most married workers are dual-income couples, a majority of business leaders, about 80% of whom are men, are not significantly involved in providing care for their children and are able to rely on spouses who do not work full-time outside of the house.  Weisberg argued that this situation makes it difficult for male business leaders to understand the multiple roles that most of their employees, particularly women, have to fill it they want to have and support a family and advance and thrive in their careers.  Research showing that giving power to people reduces their ability to appreciate the perspective of others only exacerbates the problem.

Weisberg described several surveys that illustrate the challenges associated with effectively implementing work-life balance policies.  For example, a survey of over 1,000 men and women in various stages of their careers conducted by Bain & Company uncovered “a deeply ingrained ‘ideal worker’ model” in which the most important characteristics for promotion were “maintaining a high profile in the organization, and an unwavering commitment to long hours and constant work.”  As for stubborn adherence to traditional gender roles, while 51% of the respondents in a Pew research survey believed that children were better off if their mother stayed home to care for them, just 8% of the respondents said that children would be better off if their fathers stayed home.  Another study of close to 1,000 male managers found that “men in traditional marriages are more likely to have negative attitudes toward women in the workplace” than men in dual-income marriages and rely on their own personal beliefs and marriage structures when they evaluate work-life policies in the workplace.

The bottom line for Weisberg, a senior vice president of the Families and Work Institute at the time the article was written, was that the perks described above were not enough to achieve the work-life balance eluding many women and men in the workplace and that leaders needed to embrace and publicly practice a new set of behaviors that break down the long-standing ideal worker paradigm and empowers people at all levels of the organizational hierarchy to get their work done effectively, remain on their chosen career paths, and confidently step away from their jobs at a reasonable time without guilt or angst to be meaningfully and fully present for their families.

Many companies have adopted work-life policies that are less dramatic than paying for traveling nannies and storing eggs: flextime, telecommuting and other types of working remotely flexibility, paid leaves for parents of newborns, job switching flexibility and childcare subsidies.  These are certainly positive steps and a global study of management practices and work-life balance practices involving 732 medium-sized manufacturing firms in the US, France, Germany and the UK found that the best managed firms tended to also have the most progressive work-life policies.  While the same study failed to uncover a positive correlation between implementation of such policies and high productivity after adjusting for quality of management, other surveys have provided support for the proposition that businesses that are able to effectively address and management work-life balance issues will see significant increases in productivity among their workers. 

Weisberg is one of many who continue to push for changes in organizational culture so that work-life balance coupled with unfettered access to advancement opportunities is embedded among the values and norms of the organization and its members.  In many cases, adoption of work-life policies is a response to employee requests or an attempt to remediate problems that have already arisen due to challenges that employees have encountered juggling their personal and professional lives.  Rather than being reactive, companies should proactively implement reasonable work-life policies that are responsive to the specific needs of their target human resources pool.  The best way to approach this is for the founders of the company to explicitly focus on the type of experience they want workers with families, both women and men, to have if they choose to come to work for the company.  This means going beyond the usual elements of the employment relationship—salaries, bonuses, insurance benefits, stock options—to consider the full palette of professional and personal needs of the employee. 

Founders should consider that surveys have consistently shown that employees attach great importance to work-life balance, second only to compensation, and that one in five workers would be willing to give up 5% of their salary in exchange for the flexibility to work offsite one or two days a week.  Another important factor to consider is that companies that have embraced work-life balance policies have enjoyed higher levels of employee satisfaction and retention, bringing stability to the workplace and allowing firms to retain valuable employees who have built up firm-specific knowledge and experience that would be difficult and expensive to replace.  Work-life policies are a natural extension of very real values with an organizational culture—a sense of familial connection in the workplace, loyalty and mutual respect and understanding—and thus must and should be nurtured from the day that the company is launched.

Sources and other resources for this article included A. Weisberg, “What Flying Nannies Won’t Fix”, The New York Times (August 24, 2015); N. Bloom, T. Kretschmer and J. Van Reenen, “Work-Life Balance, Management Practices and Productivity” (April 2006); Work-Life Balance Programs Benefit Employers and Employees; and The Society of Human Resource Management, Workplace Flexibility in the 21st Century (2008).  Further information on human resources management is available from the Growth-Oriented Entrepreneurship Project and those interested in receiving regular updates on topics of interest to growth-oriented entrepreneurs are welcome to send a connection request to the author.