Organisational Culture – What is It and Why It’s Important (2024)
Introduction
Organisational culture can define the success or failure of organisations at the root level, but let us start with what organisational culture is – there are many quotes or phrases that attempt to capture its essence succinctly. Simply put, it is often quoted as “the way we do things around here.” Of course, there is the well-known quote by Peter Drucker – “culture eats strategy for breakfast” which alludes to the importance of human factors in organisations.
It is summarised beautifully as – “community-held and relatively stable beliefs and attitudes that exist within an organisation.” – Organisational Development A Practitioners Guide for OD and HR Professionals, Mee Yan Cheung-Judge and Linda Holbeche.
It goes on to say that this view is based on the concept that culture stems from belief systems and basic assumptions that are formulated at formal inductions and informal observation of what constitutes successful behaviour. These are then translated into reportable attitudes and values which manifest into observable behaviours.
Organisational culture is important:
“A positive organisational culture allows employees to understand their organisation and feel that their voice matters in driving the business towards a common purpose. Continually evaluating culture is important because having shared, clearly defined values will influence the standard of an organisation’s customer service, as well as the satisfaction and retention of its people.” - Organisational culture | CIPD
Culture Change is Difficult
Changing an organisation's culture is challenging as so many factors have to come together which is why is changing culture so elusive. It could be argued that this is because an organisation's culture could be different for different people depending on their position in an organisation; the reason for this is that culture is a subjective experience of your work environment. It is also important to note that there may be an organisational culture or one that an organisation aspires to but also in existence will be subcultures within departments, teams, and other working groups.
What is clear is that what an organisation does to enable, support, and sustain desired cultural behaviour is pivotal to its success.
People and Culture
People will always think someone else is responsible for the culture, similar to the way we complain about the traffic – forgetting we are part of the traffic. So if ‘normal’ acceptable behaviours are what define an organisational culture – what happens if ‘normal’ behaviours are not aligned with the organisational vision, values and behaviours? This becomes evident in feedback from client bases, system-level conversations and collaboration both internal and external to organisations and from employee feedback.
Employee feedback can be determined and identified in many ways in organisations, for example, employee feedback, retention, absenteeism levels and causes, complaints based on equality, inclusion, and diversity, and incidents to name but a few, but the triangulation of this data is pivotal to ensuring ongoing commitment to improvement.
This commitment starts top down and bottom up, however, it is said that middle managers and team leaders are or can be the most influential in creating the culture an organisation aspires to.
Culture is more than just defining a set of vision and values, however, these are essential no matter the size of the organisation. Vision, values and strategy set the foundations for success but these need to be continuously worked upon at all levels of an organisation, to ensure they become the norm.
Those vision and values have to become the golden thread that brings people, strategies, processes, and systems together. Doing this takes time and buy-in from everyone, from executives who must consistently examine their own decisions and actions that impact an organisation, as well as each employee who aspires to work in an organisation where people thrive not just survive.
So if the starting point is the hook of vision and values aligned to strategic direction, then the first place to look is here. If your organisation does not have these fundamentals in place, work should be undertaken to define and embed these. Design should be a collaboration of as many inputs from all levels of an organisation – remember the story of John F Kennedy visiting NASA in 1962? John F Kennedy was doing a tour of the facility and along the way stopped to speak to a janitor and when asking what his role was, the janitor replied, “I’m helping put a man on the moon.”
This is the foundation of a successful culture, where every employee believes the role they play contributes to the overall vision or mission of the organisation. Imagine a workforce that embodied this – how much happier and more productive would they be?
If these fundamentals already exist but your organisational culture does not meet the vision and values aspirations, then work should be done to align these.
Changing culture or shifting behaviour patterns requires a focus on every transaction and interaction, ensuring each transaction and interaction is an opportunity to improve the quality of the interface between individuals, groups, and systems.
If your organisational culture patterns are established and identified, it is useful to consider if they are conducive to the organisation's success. Change, if required, is about defining and being open to communicating why change is required and then working towards generating motivation to change by ensuring the workforce has access to what change is needed, the motivation to change and what small observable steps they will take as individuals to illicit a greater shift in patterns of behaviour.
People are pivotal to changing cultural norms as articulated by Matt Tenney in this Ted Talk - Matt Tenney: Why The Best Leaders Make Love The Top Priority | TED Talk
With over 1 million views Matt speaks about organisational priorities being in the wrong order; (1) goals and/or profit (2) clients and/or customers, and (3) employees. He argues that the order should be; (1) employees, (2) Clients and/or customers, and (3) goals and/or profit. Essentially an organisation that fails to put its employees first can experience; disengagement, poor profits, or achievement of goals and a lack of innovation and improvement.
Building Strong Cultures
Build a vision and a core set of values framework that aligns with strategy and puts employees at the core. The vision or mission should be what all employees aspire to and what your clients or customer base can expect from you.
Shared values and behaviours that have been co-designed are the foundational success of organisations, teams and individuals. They should describe how people behave; how they treat one another, and how they can expect to be treated - demonstrable through not only human interactions but policies, procedures, processes, and decisions made at every level of an organisation.
Investing in equality, diversity and inclusion programmes are key elements of organisational culture and actualising defined behavioural parameters in which staff have a sense of belonging. This starts with recruitment, and onboarding – with those responsible for this being fully trained and equipped to understand their own biases. Formation of staff groups to ensure the organisation values and listens to the voices of employees and continuous work to diminish exclusion.
Leadership
Leaders at all levels have a profound effect on the culture of an organisation and have been described as two sides of the same coin – “I believe that cultures begin with leaders who impose their own values and assumptions on a group. If that group is successful and the assumptions come to be taken for granted, we then have a culture that will define for later generations of members what kinds of leadership are acceptable. The culture now defines leadership.” – Schein, (2004).
Principles of Culture Change – taken from Organisational Development A Practitioners Guide for OD and HR Professionals, Mee Yan Cheung-Judge and Linda Holbeche
Root culture in performance and the job to be done, thereby ensuring relevance. Otherwise, people (including leaders) are likely to revert to operating in their old ways, thus limiting the organisation’s ability to implement strategy and design effectively.
Leaders must demonstrate obvious commitment to change, set and model the climate for individuals, teams and business units to change.
It’s about practising new behaviours, not changing attitudes.
Cultural change takes time, and is not linear or programmable; uncertainty, ambiguity, risk and setbacks are inherent.
Involves recognising and working with intellect and emotions.
It creates experiences and opportunities for people to behave in new ways.
It is implemented in a way which reinforces the desired new ways of working.
Wherever you are as an organisation, nothing changes without commitment – culture change takes time and dedication but if continually worked upon its rewards are measurable in every area of an organisation.