Stop me if you’ve heard this one before: On a random weekday, seemingly out of the blue, your boss summons you to a must-attend meeting. When this happens, it’s the first step to asking, “Just what is organizational culture?”
As you enter the conference room the sense of urgency is palpable, and you exchange worried glances with your coworkers. This is a big deal. You take your seat, on edge.
“I have some big news,” your manager tells you and the others assembled. “We’re going to change our culture. It all starts with our new values statement—which will be developed within the next eighteen months by a secretive high-level team appointed by me. Get your whiteboards ready!”
Wait. What? This is another step to asking, “What is corporate culture?”
What Is Organizational Culture?
This scenario, even if a bit over the top, perfectly encapsulates how too many executives treat company values, and, by extension, organizational culture. The big, rushed, pomp-filled meeting is meant to signal that the executive cares. But the execution is transparently hollow—another trendy initiative to pretend to care about. Another box ticked.
Take your first step toward effective leadership. Work with Navalent’s leadership coaches.
Yes, the difficult work of any culture transformation should start with defining core values. But for some companies, the creation process itself is the entire change journey.
Perhaps you can relate to this superficial approach to developing a strong organizational culture. On one hand, there’s what’s said (often, gushed about). On the other hand, there’s what actually happens.
A bluster of brainstorming meetings, new free snacks in the Cafeteria, and then voix la, new screen savers and mouse pads with the colorful new values beautifully branded appear everywhere. And in private, eyes rolling and back-to-business as usual.
The bottom line is that leaders need to embody the workplace culture they wish to see. Everything else—epic whiteboard sessions included—is noise. You can say you value teamwork, but if you set budgets individually and you reward individual performance, you don’t.
You can say you value diversity, but bringing in a DEI officer and hiring old white guys from the same schools doesn’t make it so. Employees understand that if people are habitually violating them, they aren’t values—they’re suggestions. You either live them or you don’t.
Culture matters. A lot. Which is why Ron Carucci spent so much time investigating it in his most recent book, To Be Honest: Lead with the Power of Truth, Justice and Purpose. The book draws from a 15-year longitudinal study of over 3,2000 executives and employees Navalent and I conducted, much of it concerned with what makes an optimal work environment.
Among other praise, Jonathan Haidt, the author and prominent NYU social psychologist, called it “the best book on culture I’ve ever read.”
It’s important to note here, though, that organizational culture isn’t necessarily “good” or “bad.” Obviously some ideas, like “don’t lie to your customers” or “don’t mistreat employees” are unequivocally right. But so many aspects of a given work environment exist on a continuum.
These continuums aren’t meant to describe two opposite states, rather “degrees” or “levels” of behavior; think about setting your stereo equalizer to achieve the right level of bass and treble, or using both hot and cold faucets to create the right temperature.
In the same way, organizations seek a unique “mix” that’s optimal for their present and future needs, adjusting it as necessary.
That being the case, in order for you to understand how organizational culture change really happens (spoiler alert: not by writing perfectly crafted values statements), you need to understand what drives it. That’s the focus of this article.
With that in mind, here are the seven main drivers of organizational culture—those elements of your organization that shape people’s behavior—and what they look like in practice.
Each list entry includes a driver, two crucial elements of the driver, and examples of what each element looks like at different ends of the workplace culture continuum. What organizational culture is—and where your own company falls on the spectrum.
The 7 Drivers of Organizational Culture
1. How the organization sets direction. Do you look forward or back—or somewhere in the messy middle?
Clarity of goals (specified vs. evolving)
When goals are specific, performance levels, targets, and timeframes are predetermined. The organization moves only in a defined direction, with clear goals, before it takes any action.
Learn your workplace benefits from organizational culture with these blogs:
When goals are allowed to evolve, performance levels, targets, and timeframes emerge organically. Performance requirements may be ambiguous to some degree, and just-in-time goal setting is used as circumstances dictate.
Perception of the future (opportunity vs. threat)
Having a vision of future success can provide inspiration and energy. When this is established, team members are more likely to rally around a common cause. The employees and leadership think of themselves as working toward a shared opportunity; a general feeling of positivity is the natural result.
On the other hand, when an organization views the future as a threat, employees can be negatively motivated: driven to avoid a downturn in business, an upstart competitor, or the challenge of overcoming tough circumstances.
2. How results are achieved and rewarded. How do you ensure success: acting spontaneously by the seat of your pants, or by having a plan?
Nature of work (precise vs. fast)
If the company’s offerings must be precise, and you’re looking at what organizational culture is, the organization will have a strong preference for exactness and discipline.
Procedures and adherence to policies will be more rigorous, and, when a challenge arrives, employees may rely on predetermined methods and styles. Success is judged by degrees of excellence and error-free outcomes.
Other organizations aren’t as wedded to precision when it comes to their offerings, but they are expected to be fast. They need to produce outcomes quickly, even if they’re less than perfect. Reducing the product cycle is a main focus of improvement.
Motivating employee engagement and performance (inspiring vs. enticing)
Leaders who “inspire” their employees place high degrees of faith in their people. They model courageous and decisive actions, letting their actions speak for themselves. They are accessible and not uncomfortable giving others autonomy to perform their jobs.
Leaders who prefer to entice their employees appeal to people’s desire for tangible rewards. They expect the performance standards they set will be recognized and met. They energize their people by emphasizing the links between outcomes, rewards, and consequences.
3. How the organization leads. What’s the hierarchy culture like at your company—rigid or fluid?
How decisions are made (constituents are involved vs. constituents are directed)
Some leaders invite employees to participate in organizational decision-making and problem-solving, encouraging the exchange of candid feedback across the organization.
Others insist on providing precise direction to employees dealing with routine problems and decisions. In their view, the degree to which someone is welcome to participate depends on their level. These managers make decisions at the top, and then they are communicated down the chain.
How differences are handled (downplayed vs. leveraged)
Some leaders seek unity above all else and shy away from highlighting differences among people. In this sort of “clan culture,” leaders model predictable, consistent (and detached) behavior and expect employees to do the same.
Other leaders attempt to capitalize on the differences among employees. They are open to varying perspectives, personalities, and approaches. Exceptions to policies and procedures are tailor-made to fit the circumstances.
4. How relationships and networks are formed. How do employees build connections and establish rapport?
Nature of connection (independent vs. interdependent)
As you think about what workplace culture is, you should consider that independent-minded leaders believe someone’s success isn’t closely linked to the success of others. Rather, any outcome—positive or negative—is primarily the responsibility of individuals, not groups.
Other managers believe success is closely linked with the success of others. By its nature, work at any organization prompts people to collaborate with others, all of whom share responsibility for outcomes. This fosters a more interdependent employee experience.
Quote
The culture of a company is the sum of the behaviors of all its people.
– Michael Kouly
Feeling of interactions (cooperative vs. competitive)
Cooperative-minded leaders encourage mutual support and helpfulness. People at these organizations are likely to describe the work environment as “friendly.”
Conflicts are openly discussed so that the merits of all viewpoints are understood and integrated. People are readily able to coordinate multiple efforts across units. Loyalty to the larger organization is a common outcome.
In competitive workplaces, continuously improving on individual performance is paramount; comparisons between individuals may even be explicit. In this type of culture, employees are likely to describe their workplace as aggressive. Loyalty to one’s work unit, as opposed to the organization itself, is common.
5. How the organization communicates. How do people in your organization interact and get along?
Treatment of information (selective disclosure vs. broad disclosure)
Managers who disclose information selectively keep their cards close to their chest; they rely on stringent criteria to determine who should be informed of what. In this work environment, confidentiality is highly valued. Employees may feel “left in the dark.”
Leaders with a broad disclosure style routinely offer important information across levels and boundaries. They make deliberate efforts to keep employees informed, and workers have access to important information as needed.
Relationship between actions and words (authentic vs. guarded)
Companies that value “authentic” interactions model and encourage candid communication. From top to bottom, people are comfortable speaking their minds. As part of the process to gain trust, employees will exhibit humility and acknowledge personal shortcomings.
In more guarded work environments, the emphasis is on promoting the positive aspects (or opportunities) of any situation. Communication is expected to foster unity, and employees espouse the organization’s “way” to gain trust.
6. How the organization competes. How does your company set itself apart—inside and out?
Where energy and resources are directed (internally vs. externally)
Companies with an internally focused organizational culture devote the bulk of their energy to continuously improving internal processes, procedures, and structures. Product differentiation is based on the outcome of self-assessments. They tend to have a moderate degree of competitor awareness.
Companies with a more externally focused organizational culture devote their energy to pursuing and applying new market and customer insights. Accordingly, they differentiate their products largely based on competitors’ offerings and other external data. They have a high degree of competitor awareness.
Source of competitive differentiation (service vs. cost)
Service-oriented workplace cultures strongly emphasize understanding and exceeding customer needs. They have superior customer support, which they leverage to create customer loyalty.
Tip
As you can probably imagine, a strong company culture isn’t made overnight. So start with a small step to lower the pressure on yourself and your employees or/coworkers—and then revel in victory when it arrives.
To begin:
- Identify a driver whose impact you’d like to investigate.
- Identify where you fit on the continuum of organizational culture when it comes to that driver.
- Make one small change in the direction you’d like to head.
- Investigate the results. Did anything change?
Cost-first cultures instead devote their efforts to maximizing efficiency and keeping costs low for customers. The relationships they leverage are with suppliers, whom they lean on to help keep costs controlled. Their competitive advantage comes from close attention to product and service pricing.
7. How the organization changes. What is your organizational culture when it comes to dealing with change?
Impetus for change (reactive vs. proactive)
In reactive organizational cultures, change tends to happen only when events make it necessary (for example, when poor company performance levels can no longer be ignored). Dissatisfaction with the present state emerges slowly.
Proactive organizational cultures embrace change, especially when a shifting work environment is anticipated. Change to improve effectiveness may be initiated even when there are no immediate pressures to do so. Dissatisfaction with the present state emerges quickly.
Scope of change (singular vs. integrated)
Singular organizations focus on specific component(s) of the organization when it’s time to make changes. This type of organizational culture aims to avoid system-wide stress by controlling the scope of change. It prefers incremental change giving local ownership to initiatives.
Integrated organizations focus on the entire organization when it’s time to make changes. The organizational culture seeks to build a critical mass of supporters across multiple levels and functions.
Managers encourage widespread participation and ownership through organization-wide communication and linking together multiple simultaneous initiatives. In this sort of company, senior executive leaders own the change process.
What Workplace Culture Is and Isn’t
Historically, the notion of what “corporate culture” is has been shrouded in mystery and ambiguity. It’s easily confused with things like engagement, or as was historically referred to, climate—in essence, the “mood” of the organization. While important, that’s not culture.
Because it’s been hard to describe and harder to quantify, discussions of culture have taken on an almost mystical quality. Corporate campaigns aimed specifically and exclusively at culture change have often taken on an almost Orwellian tone, urging employees to adopt new values and behave in different ways.
Internal communications campaigns have preached the message of culture change before any substantive changes actually occur. In those situations, the messages have rung hollow, planting the seeds of cynicism and disillusion that have so frequently surrounded corporate culture initiatives.
The underlying belief has been that if you distributed enough posters, placards, and wallet cards, people would fundamentally change the way they performed their jobs. They didn’t.
By contrast, the actions that lead to real culture change are tangible, pervasive, directly connected to the organization’s strategy, and fully integrated into the overall fabric of organizational life.
Slogans, posters, and pep rallies in the absence of real change are not only pointless, they’re actually counterproductive. They have a high risk of exhausting resources and diluting the credibility of leaders to ask for “real change” when it’s required.
As the world settles into whatever future of work brings, employees are letting us know loud and clear they won’t tolerate toxic cultures, or bosses, any longer. They’ll quit and leave, or they’ll quit and stay. Shaping a culture in which people can thrive and contribute takes courageous and sustained effort.
So if you’re a manager, it’s worth keeping this in mind whenever you get an itch to change things up. There’s no shortcut to creating a strong company culture, no matter how many whiteboards you throw at the problem.
What Is Organizational Culture? A Way to Get Results
Build a strong workplace culture from the ground up with the help of Navalent’s leadership coaches. With executive and CEO coaching services, you’ll develop long-term solutions to drive business success.
Start laying the foundation for a better business tomorrow, today. Contact us.