3 Things Leaders Should Know about Corporate Culture
Aligning corporate culture with business goals drives success
An organization’s culture is the very essence of its business. A healthy culture is a catalyst for employee engagement, collaboration, and innovation—all of which help your business yield higher returns. When culture and business goals align, employees feel more in sync with your organization.
Corporate culture, also known as organizational company culture, affects how an organization functions and expresses itself. Culture is the personality of an organization and encompasses three fundamental components:
2. Assumptions: The attitudes, often unconscious, formed through company processes and actions that inform what employees and clients think.
3. Artifacts: What a company creates, including products, technologies, and publications, as well as internal processes, locations, and architecture.
All companies want a strong culture that works alongside their business priorities—but how do they do it? It’s not magic. It takes hard work and thoughtful analysis, and it’s worth the effort. University of Michigan professor Jeff DeGraff says that leaders should understand 3 things about culture:
1. Your Company Culture Situation
There is no one-size-fits-all approach to creating a healthy corporate culture, as no two businesses are exactly alike. What might work for a larger company may not work for a smaller one, and each company has its own unique dynamics. It’s important to consider and assess your company’s particular situation. What is the primary focus of your business? Which areas do you know you need to work on?
The Competing Values Framework™ posits that each organization has 4 competing values: Collaborate, Create, Compete, and Control. By understanding those values, a business can learn more about its culture and priorities. The Competing Values Framework helps decision-makers assess organizational and individual needs and plan accordingly.
- Collaborate: Doing things together with internal partnerships and team building in a flexible environment.
- Create: Doing things individually while differentiating with a high degree of experimentation.
- Control: Doing things right, through internal procedures, with a need for stability and consistency.
- Compete: Doing things quickly through external competition with a drive for results.
These dynamics live in tension with each other, and businesses may find that they lean toward a particular quadrant: some companies may be flexible and inventive, while others may be more deliberate and task-focused. Understanding your position within the Competing Values Framework can help you gain new insights into organizational culture and business practices.
2. Your Organizational Subcultures
Even if your organization has a dominant culture, it might show up differently in certain parts of your company. Most companies have many subcultures, which helps departments perform more efficiently based on their specific functions and goals. Fostering those subcultures can also help employees feel more engaged.
Here’s a specific example:
Let’s say your company manufactures a new technological marvel—say, a supersonic delivery drone. You recognize that your business has a dominant Create culture. The people who invented the miraculous drone work in that Create culture, creating and developing new products and features. However, other employees and departments within your company have different functional subcultures.
Your drone manufacturing department builds everything exactly to specs and quality standards, which is a Control culture. Your drone marketing department may work in a Collaborate culture to plan strategies that target customers, build awareness, and help drive the efforts of the sales team. And your sales team would probably work best in a Compete culture as it finds customers and closes deals.
Successful cultures are more than posting a mantra on a banner in your office. Corporate cultures are dynamic. By analyzing your situation, understanding your timelines, and differentiating your subcultures, you can align your organizational culture with business strategies and goals. A healthy culture will help keep employees engaged, promote innovation, and drive business success.
3. Timelines for Your Work
The pace of work is an important driver of corporate culture. What’s your typical timeline for work? Do you have a lot of time for experimentation and planning? Or do you need to quickly turn around projects and get them done as soon as possible?
Neither is necessarily right or wrong, but timeframes affect your culture. For example, if your timelines are extremely short and you need to produce results quickly, you may find that you have more of a Compete culture. But, if you spend a lot of time planning, researching, or experimenting for each project, you could have more of a Create culture.
Depending on the size of your organization, you probably have different departments that run on various timelines—not everybody has the same goals and priorities. Sometimes those timelines don’t necessarily align; for example, a sales unit might have a much more time-focused approach than a research and development unit. Those departments would have different subcultures.