What is Organisational Culture?

What is Organisational Culture?

Culture is defined as ’the ideas, customs and social behaviour of a particular people or a society’.

Put simply, it’s how people behave when they don’t think that they’re being watched.

There are a number of models that can be used to help understand organisational culture. There are three that are prominent and that I have found helpful to articulate what a culture is and how it can be developed.

The Culture Web

The Culture Web is explained in the ‘Fundamentals of Strategy’ by Johnson, Whittington and Scholes. They talk about six different dimensions or lenses that you can use to understand an organisation’s culture.

Stories – The past events and people talked about inside and outside the company. Who and what the company chooses to immortalise says a great deal about what it values, and perceives as great behaviour.

Rituals and Routines – The daily behaviours and actions of people that signal acceptable behaviour. This determines what is expected to happen in given situations, and what is valued by management.

Symbols – The visual representations of the company including logos, how plush the offices are, and the formal or informal dress codes.

Organisational Structure – This includes both the structure defined by the organisation chart, and the unwritten lines of power and influence that indicate whose contributions are most valued.

Control Systems – The ways that the organisation is controlled. These include financial systems, quality systems, and rewards (including the way they are measured and distributed within the organisation).

Power Structures – The pockets of real power in the company. This may involve one or two key senior executives, a whole group of executives, or even a department. The key is that these people have the greatest amount of influence on decisions, operations, and strategic direction.

The Schein Model

The Schein Model is taken from the book, ‘Organisational Culture and Leadership’. It looks at the culture from the perspective of an observer and describes three lenses.

Artefacts – What are the physical artefacts that can be seen, felt or heard by the uninitiated observer. These could include, how people dress, the office environment, the facilities etc. It could also include how people visibly interact with those outside the organisation.

Espoused Values – What are the values of the Organisation? Company mission statements, logos and slogans are useful examples.

Basic underlying Assumptions – What are some of the basic undying assumptions for how people operate within the organisation. For example, in most organisations, it is culturally acceptable to turn up late to meetings. Everyone is forgiving and then people move on. In the military, it is completely unacceptable to be late to an event. These are two extreme examples but they make the point that both organisations have underlying assumptions that people adhere to… or don’t

Charles Handy Theory

Charles Handy Theory links the organisational structure to the culture. Handy talks about four different cultural structures.

Power Culture – control radiates from a few individuals and their influence. ’The powerful few’ make the majority of the decisions. There are few rules and little bureaucracy. Decision-making tends to be swift because only a few people hold real power and authority. Execution of tasks can be quite quick but it can feel directive when you work in an organisation like this. These organisations can quickly turn toxic if there isn’t a strong moral compass at the top of the organisation.

Role Culture – role cultures are hierarchical bureaucracies. They tend to be large organisations, examples might include the NHS or the big UK retail banks. Power derives from a person’s positional authority, what they’re responsible for and who reports to them. They tend to be risk adverse organisations and slow to react to changes in the external environment.

Task Culture – Teams are formed to work on specific areas or solve specific problems. Power derives from the individual’s expertise as long as the wider group values it. The task, and completion of the task, is the most important thing! Power shifts depending on who is in the team, the nature of the problem or the stage in the task’s completion. If you get the right mix of people, leadership and governance structures, it can be very powerful. This is what a good matrix organisation looks like.

Person Culture – Power is held at an individual level. The organisation will consist of people with similar training and a a similar background. The organisation is a collective of individuals who are loosely aligned such as a group of barristers or heard-hunters.

There are overlapping themes between these models, which you might expect to see. I think they give subtly different perspectives on how to view organisational culture.  I am more interested in the ’so what’ – what do you actually do with your organisational culture? How do you nurture it that so that it can improve performance?

Culture and High Performance

Most organisations look at culture for one of two reasons.

1. They want to proactively manage it and build a high performing organisation.
2. They’ve got a problem – or they keep coming up against the same problems – with the way people are behaving in the organisation. Organisations that don’t proactively manage their culture tend to end up in this bracket. They run the risk of descending into toxic cultures if left unmanaged.

High performing organisations proactively manage their culture. They ensure that people are promoted into leadership positions for what they achieve (results) as much as how they achieve them. Most organisations tend to manage culture on an ad-hoc and reactive basis. Leaders are selected for the results that they achieve and there is less concern about how they achieve them. These organisations carry risk that they’re often not managing. They tend to be one scandal away from significant reputational damage.

Case Study – The Royal Marines and Netflix

One is a 350 year old war-fighting organisation, the other is a young tech company. Both are considered high performing organisations in their respective fields. What do they have in common? A carefully articulated culture and set of values.  People are selected and promoted for their adherence to these cultural principles, ensuring that the organisation is built on strong behavioural foundations.

What I find interesting is how many shared values they have.

• Integrity
• Courage
• Unselfishness/Selflessness

These are the hallmarks of a high performing culture. But they’re not accidental. These have been deliberately crafted and nurtured over time. People that adhere to these values get promoted to positions of leadership which reinforces the ‘right behaviours’ and the culture the organisation is seeking to create.

Culture is relatively simple in theory but it’s hard to get right in practice. It requires clarifying what good looks like, reinforcing the behaviours that contribute towards the culture you’re trying to create and challenging the ones that undermine it.

Values and behavioural standards are important but they’re only part of the cultural puzzle.

The Culture Code by Daniel Coyle highlights three areas that organisations need to work on in order to develop their culture. These principles work at a team level as well as an organisational level.

1. Psychological Safety – People have to feel safe within the organisation. They have to feel like they are part of the tribe and that others will look out for them. Psychological safety is created in subtle ways. Coyle talks about Google, the Christmas Truce and a group called the Missileers before going on to talk about the behaviours and practices that lead to the creation of a sense of belonging.
2. Vulnerability – People have to be able to demonstrate vulnerability, that they don’t have all the answers – and that that’s okay. Without this, they won’t feel that they can ask for help from their colleagues. if they can’t ask for help from their colleagues, they’ll merely form a working group rather than a real team.
3. Purpose – A strong sense of purpose is a key driver for people. Daniel Pink talked about the three motivators being Mastery, Autonomy and a Sense of Purpose. Organisations that are built for the relentless pursuit for profit often lack a sense of purpose meaning that they can’t harness the true potential and discretionary effort of their employees. A sense of purpose is developed by asking the question, ‘how does this organisation make the world a better place?’ Simon Sinek takes much of the credit for ‘discovering purpose’ but the reality is that it comes from Victor Frankl’s book, ‘Man’s Search for Meaning’ which is about his experience in the Holocaust.

Culture is intangible. It’s often difficult to see and put your finger on but it has enormous impact on how people feel about the organisation. It requires constant attention and careful nurturing. Hopefully these ideas give you some food for thought on how you can articulate and create a culture that supports the performance of your organisation.