8 minute read
Remember our article on organizational culture?
In it, we defined what culture is, and how you can define different types of cultures for the success of your business. This is important because having a positive organizational culture means:
- Your employees focus on priorities
- People produce efficiently and effectively
- Creativity is welcomed
- Shared accountability is the norm
- Opportunities exist for people to learn and hone skills
On the other hand, a negative culture could lead to a lack of cohesion, gossip, and cultural roadblocks. And, whether you realize it or not, these will no doubt affect your metrics and KPIs.
At Krauthammer, we’re committed to making your business a success. We do this through training your mindset and creating cultures of positive cohesion across your organization.
In short, we want to help you foster a positive organizational culture.
Which is why, today, we’re going to go into more depth about the types of organizational cultures that exist.
Defining these 3 attributes and types will be the toolbox you can refer to when optimizing your processes. But more than that, this article aims to help you understand the personalities that drive your business plans and how you can work together to uphold your company values.
What is organizational culture?
First things first: What is organizational culture?
Organizational culture refers to the collection of values, mindsets, expectations, and practices that guide the decisions and actions your team takes.
In short, it’s about the behavior of your employees and, especially, what kinds of positive behaviors you can begin to cultivate as a team leader.
Let us give you an example.
In The Netherlands, expats read a famous book called Why The Dutch Are Different. This gem pieces together different ‘stereotypes’ that help understand Dutch culture – but this is executed in a way that’s funny and self-aware.
For example, without understanding the colonial history of the Netherlands, many would be surprised to see Indonesian food served on many corners.
Not to mention the legality of marijuana culture, sex work, or the priority bikers get – yes, even over pedestrians!
Getting to know how people think could save lives (especially if you’re biking in Amsterdam for the first time).
Similar to a country’s culture, organizational culture is the type of shared values your employees benefit from. But you shouldn’t mistake this for your company values or mission statement.
Instead, it’s really about the people behind the work.
This human-centric approach to running a company is something we stand by and trained for here at Krauthammer. Because without a human-centric mindset, how do you expect to run a company of humans?
How to start defining your organizational culture
According to Achievers, companies with healthy cultures are 1.5 times more likely to experience revenue growth of 15% or more over three years.
Our in-house behavior trainer, Syzmon Rompczyk says,
“To facilitate organization success, this sometimes means you have to put a mirror in front of your employees and look deeply at the behaviors they show.”
Defining organizational culture means:
- Pinpointing individuals’ behaviors,
- Creating a cohesive map of common behaviors you can leverage to describe your company culture.
Plus, when recruiting new people, culture is key. 88% of job seekers say that a healthy culture at work is vital for success.
So let’s define the types of organizational culture, first by looking at common attributes and then defining the types.
3 types of organizational culture attributes
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Shared
A shared culture is a group phenomenon. Meaning, that everyone is motivated by a set of shared behaviors and values.
Yet, these shared attributes aren’t exactly written on paper.
Instead, they are unconscious, unspoken, and are usually inherent in the individual.
Think of UNHCR workers. This is the branch of the UN responsible for advancing the rights of refugees and asylum seekers.
When it comes to a collective mindset on immigration or reintegration, where do you think UN employees stand?
By adhering to a communal set of shared cultures, UN employees can effectively work toward their mission.
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Pervasive
Pervasive culture means values and organizational attributes are shared everywhere and explicitly.
These are usually defined by an organization's identity and come from two places:
- The physical environment people (employees, customers, audience) see every day
- The stories and legends people tell each other.
Think about Google.
Every Google employee works towards creating a strong, well-identified brand. Every visible characteristic attached to Google is easy to spot – from the campus where employees work to the brand’s logo.
Individuals become remarkable for being part of the pervasive Google culture, and their motivations or mindsets are as easy to collectivize.
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Enduring
Coco Chanel – the founder and face of the Chanel brand.
This organizational culture attribute is one that is both shared and inherent. With these two attributes in tow, it defines a culture that will last for a long time.
Employees understand the legacy of the brand or business, and are usually hired because they ‘fit in’.
Take a brand like Chanel.
From their social enterprise to their retail – they have a strong and enduring culture that seeks to sell products while their mission statement fights for women’s equality.
Individuals who ‘fit into” the Chanel brand get hired– and these are usually individuals that are also intelligent, driven, and stylish. People will be drawn to this culture if they know of it, and it becomes self-reinforcing and, therefore, enduring.
3 types of organizational culture to create corporate cohesion
As we’ve seen in our previous article on organizational culture, we can classify the different types based on the Competing Values Framework.
And although this framework is something we teach in-depth in our programmes. And although this framework is widely recognized, keep in mind it’s not your silver bullet.
Just like you can’t say all Dutch people are angry bikers, your organizational culture will end up being a mix of these different types. But one or two may just dominate, which means it’s still important to unpack them.
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Adhocracy culture
Coined by American futurist Alvin Toffler, adhocracy culture comes from the term ‘ad-hoc’. Meaning, that this type of organizational culture is dynamic, spontaneous, and responds to changes in the market such as:- trends,
- innovation,
- competition.
This culture comes largely in response to old and sterile ways of working. Startup culture is a great example of adhocracy in action.
Big tech also relies on an adhocracy culture. Do you think Google and Apple could stay on-trend and relevant without their fast-paced workforce?
Benefits of adhocracy culture:
- Flexibility
- Results-focus
- Employee empowerment and emphasis on individual initiative
Disadvantages of adhocracy culture:- There is often a lack of clearly defined leadership (especially in startup environments)
- High-risk business strategy
- Chaotic working environment
How do you adapt your mindset for this organizational type?
It’s clear that orchestrating this type of organizational culture is risky, but nimble. In order to adapt for it, here are some tips:
- Favor the adrenaline junkie, both in your own output and in who you are hiring
- Have an adaptive mindset that caters to change. And don’t be too rigid in your decision-making! You want room for experimentation, and for this, you need to take risks.
- Create a flexible working culture, where employees can choose where and how they work (provided it aligns with your HR core values and company direction)
- Be confident in your team members. Don’t allow for micromanaging and empower individuals to be proactive and run themselves.
- Adopt a flexible mindset, and place emphasis on innovation and improvements.
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Clan Culture
Bill and Melinda gates foundation.Clan culture is a type of organizational culture that is tribe-like. In short, it’s when a company has an emphasis on consensus and commonality.
Smaller NGOs usually favor clan culture, because employees are not only working towards shared values but doing so through a small organizational structure.
This usually creates a kind of family feeling.
Which is also why family-owned businesses have clan cultures in place. In this organizational type, individuals:
- collaborate,
- participate,
- mentor.
Benefits of clan culture:
- Strong teamwork
- Shared values
- Lots of information sharing and open communication
- Strong social bonds
Disadvantages of clan culture:
- Emphasis on discretion could lead to exclusion
- Managers need to engage employees socially as well as professionally
- A lack of authority could ensue
- A tightly-knit culture may be more difficult to innovate
How do you adapt your mindset for this organizational type?Clan culture has its ups and downs. But as a manager, it’s clear you need to have a handle on both your company’s core values and the personalities within your team.
But adopting a human-centric attitude will only get easier through training and putting what you’ve learned into practice.
Here are some tips to get you started:
- Build trust between your employees. Always openly discuss any company failures or shortcomings, and make sure all KPIs, metrics, and goals are available.
- Promote a culture of feedback, where people’s opinions are valued and taken into consideration.
- Integrate social outings as a must-do for employees so they can get to know each other and bond as teams (you could even promote team awards!).
- Reward loyal employees.
- Be a mentor and a coach. There’s a difference between being a manager, and being a leader. Take this one step further by listening to your employees and mentor them throughout their career journeys.
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Hierarchy Culture
Example of an organization structure with hierarchy culture.
Hierarchy culture favors stability. It’s the more regimented type of organization we’re used to. Which basically looks like people on top making decisions that influence the company's direction.
Most corporate cultures have a hierarchy. Without it, there wouldn’t be much structure. But, like our other types of organizational cultures, this comes with both benefits and disadvantages.
Benefits of hierarchy culture:- Opportunity for individuals to grow (i.e., ‘climb the ladder)
- Structure and resilience over time
- Consistency
- Slow moving
- Hard to change core mission
- Strict procedures
How do you adapt your mindset for this organizational type?
[https://www.youtube.com/watch?v=cS9qCre_sv8]
Michael Scott’s rap video in The Office is a great example of a boss bringing some positive, fun to a hierarchy workplace.
You know when people say something is too ‘bureaucratic’?
In order to influence a positive hierarchy culture, you need to have a mindset that sticks to the rules but is also open to innovation.
After all, while this type of organizational culture has proven to work, there are ways you can adopt your mindset to make it work in the 21st century.
Here’s how:
- Enforce a clear chain of command. But make sure you don’t fall into a leadership style that leaves no room for creativity or feedback-sharing.
- Make big decisions, but make sure they don’t take too long to be implemented. The fallback of hierarchy culture is slow decision-making. It’s up to you (as a manager) to make these important decisions in an efficient and responsible way.
- Empower your employees to grow. There are a lot of opportunities to climb the ladder. But this means you should enforce loyalty and incentives to make your employees stay working for the company.
- Set expectations for your team, with clear goals and a core code of conduct to work by. Be a leader who accounts for the members of your team, and adheres to these values every step of the way.
- Routine and stability are necessary for your team. But don’t let that top-to-bottom leadership prevent you from forming 1:1 connections with the individuals. You can still create a clan-like environment that favors structure and is results-driven.
What about market culture?
One organizational culture type you may have noticed we left out is market culture.
That’s because while healthy competition between the team is favorable, it could also lead to bad workplace culture. Market culture doesn’t necessarily look at people but at results.
This is something that needs to change. Especially as the future of work is becoming less driven by numbers, and more driven by human-centric ideals.
Getting the job done can sometimes have an impact on employee wellbeing:
- As of 2022, 52% of all workers are feeling burned out
- In a study by McKinsey, 49% of respondents said they were burned out
- 70% of employees who experience burnout don’t feel supported by their managers
We shouldn’t ignore these high numbers. And market culture can often create these toxic work environments.
For example, imagine you’re running a sales team. You want to promote a commission-based salary, so hire competitive employees.
However, you’re also running a company based on Clan Culture. You realize too quickly that your competitive sales team is not a culture fit. They are too aggressive and don’t put the team before their commission targets.
This creates a discrepancy between your teams and ultimately leads to a toxic environment.
So while promoting competition can be healthy at times, it’s important this aggression is neutralized just as quickly based on your organizational culture goals.
Create a positive organizational culture today!
So there you have it, your three main attributes and types of organizational culture.
By now, we hope you understand that it’s by combining the best possible resources from these cultures that will help your business thrive.
To end on another quote by another one of our great consultants,
“In order to trust your team to be successful, you need to have a mindset that you are also successful. This means cultivating a positive mindset, and soon you’ll see a positive culture as well. In short, it’s about having the attitude and mindset to be able to manage your team successfully.” - Fotigui Camara
If you are ready to start cultivating a positive mindset, download our Manage your mindset e-book to take your first step!
