An Introduction to Corporate Culture

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An Introduction to Corporate Culture

From my days as a Change Manager I remember the words “Ignore the power of your corporate culture at your peril”.  Making decisions without sufficient regard to the culture in which they’ll be implemented in can lead to unnecessary headaches, setbacks and in some cases spell the end for either the leader or the business.  Here’s a very brief overview of culture.

What is culture?

Put very simply it’s the common ground or medium on which staff and therefore the business grows or dies.

How do I observe my culture?

  •  Artefacts – Pay attention to what you see, hear, and feel around the organization. You’ll notice how people interact, however you won’t make sense of this until you discuss your observations.  Otherwise you’re mindreading.
  • Espoused Values – Written material, brochures, websites etc will say what the company stands for; it’s principles and values, its strategies, goals and philosophies. If you observe an inconsistency between what the company says it’s about and how people actually behave then you’re witnessing the real culture in action.
  • Shared Tacit Assumptions – Here you look at the organization’s history. What values, beliefs, past successes have got it to where it is today?  Whatever got a company to where it is today becomes a powerful legacy.  An unconscious ‘this is how we do things around here’, ‘ this is what we won’t rethink or violate because if we do we may not be successful anymore’.

The culture becomes all those invisibles that have lead to the recipe for business success.  If you want to survive, let alone thrive, then this is what you need to do, otherwise you won’t fit in.  Of course sometimes a culture has served its purpose and needs to change in order to be a medium that supports the next level of success and growth.  Culture in this sense controls you rather than you controlling culture.  However it’s now possible to measure your culture, to assess how much fear is driving business decisions and employee behaviour.  It helps you expose assumptions and outmoded belief systems, it gives you a framework in which to orchestrate and successfully manage your culture.  If you don’t understand your culture and you attempt to change it, or implement decisions that are unsupported by the current culture then pain awaits you.  If you measure your culture you can now control it, rather than the other way around.

Depending on the life cycle of your business there are various cultures:

Start-Up Culture

Here it’s the founder’s behaviour and values that set the culture.  What does the leader focus on, where do they allocate resources, how to they select staff, the reward system, the working environment, the office systems & processes, how do they select and support customers, how do they handle a crisis – all these determine the culture of the organisation.  Everyone who joins this organisation takes on the founder’s values, beliefs and ways of working – it becomes how we do things around here.  This is quite scary for founders as they probably don’t realise they’re becoming the rate limiting factor or the success factor as to what’s possible for the organisation long in to the future.

Midlife Culture

As companies grow, subcultures emerge.  Various departments, geographic locations, functions face different challenges and so they have their own way of being successful.  This can be a source of conflict as the departments / locations / functions attempt to work together.

Of course the other significant challenge is the migration from the founder to the next CEO.  Here it’s important to have an explicit understanding of what works for the company now and future and what worked in its infancy (or was idiosyncratic of the founder) and now needs to be left behind.

Mature Culture

Here the culture is deeply embedded and unconscious.  The founder and first few CEO’s have gone and many aspects of their successes (or failures) have passed in to ‘lore’.  Unlike a start up culture where any change is either quickly accepted or rejected, a mature organisation is rather like a super tanker, if the culture no longer supports the organisation’s success it can take awhile for this to show through.  In some cases when it’s so obvious that a ‘crash’ is about to happen the only way to save the organisation is to bring in a turnaround manager.

Culture Change

This phase is about letting go of what no longer serves and actively embracing and re-enforcing what does.  Not just talk about it, but in every facet of the business process.  Of course this change can cause anxiety.  Even if we know we need to change it can bring up our feelings of insecurity, loss of identity or group membership, or appearing stupid.  Then we see an increase in scapegoating, bargaining, or denial.

Generally speaking for culture change to be successful the anxiety people have about the survival of the organisation has to be stronger than their anxiety about learning how to do something different.

What happens when Cultures Merge

When companies join, two cultures meet, or rather collide.  The reason many joint ventures, mergers and acquisitions never release the financial benefit is usually because no cultural audit or cultural due diligence was done.  What you have then are two cultures becoming sub cultures.  They can coexist, one can dominate or a blend of both will emerge.  Very often each culture thinks it’s the best and becomes more attached to its past and intrinsic ways of doing things.

Leading your Culture

Culture is deeper, broader, and more powerful than many leaders realize.  Before you begin to change the culture you first have to know what it is.  In fact if you’re clear on the issues, challenges and opportunities facing the organisation then you can assess how much the current culture will support or prevent them from happening.  Your corporate culture is a source of strength and profitability which should be built upon.  When you understand your culture you have the capacity to understand any conflicts better, you notice ways forward and routes to guide and support your staff.  Understanding your culture allows you to know just where to tap to release human potential and create significant business performance.

 

If you’d like to know about measuring your culture, or measuring your personal fit with your company’s culture contact us.

If you’d like to see whether culture is the silent assassin in your business, get your copy of our corporate culture report.

2017-04-24T15:23:06+00:00By |Business, Growth, Leadership|