Suppose that you’re planning to go to a stadium to watch a soccer match. On game day, you probably wear your favorite team colors to cheer your team. But in a skateboarding competition, you wear any color you want. In both cases, you go to a sports event but certain circumstances and dress codes make you dress properly for any occasion. Organizational culture follows the same rule. In this article, you’ll read more about the definition of organizational culture.
What is Organizational Culture?
Each organization has its own personality, just as we all have different personality traits. This unique personality is what we call organizational culture. It’s an influential force that establishes certain guidelines, values, and expectations within an organization. It consists of shared values, assumptions, beliefs and also the vision of a company. If you ask employees in a company to describe their organizational culture, all of them will say the same thing. In fact, company culture has a direct impact on employees’ behavior towards one another. Each company develops a unique culture so as to determine certain boundaries for employee behavior in the workplace.
Why Does Organizational Culture Matter?
Revenue growth is important for every company. Believe it or not, the culture of a company plays a significant role in its success. According to research, positive organizational culture leads to an average revenue growth of more than %15 in three years. Company culture outlines objectives, values and the vision that every employee should follow. Also, it motivates people to become the best version of themselves. Here are some of the reasons why organizational culture is important:
1. Improve Employee Engagement
When working in a healthy workplace, there’s almost nothing to be upset about. As employees know what they’re doing, they’re happy and highly motivated. Companies with strong organizational culture allow employees to follow clear objectives and stay focused on business expectations. As long as employees are familiar with the company vision, they try their best to reach that goal. This results in a highly engaged workforce with increased productivity.
2. Build a Strong Brand Personality
If you develop positive company culture, you’re more likely to attract new customers to your business. Your organizational culture has a direct impact on the way you communicate your brand personality. In other words, good company culture helps an organization build a strong brand image. On the other hand, weak organizational culture makes people get a bad idea of your business. Therefore, developing healthy company culture can increase sales.
3. Retain Great Employees
Sometimes, employees feel ignored at work. Such a workplace environment can gradually undermine employees’ self-confidence. As a result, they’ll immediately leave your company. As you know, people like to work in companies where they feel appreciated. To ensure all your employees feel valued, you should develop positive organizational culture. Building strong company culture helps retain hardworking employees.
4. Turn You into a Team
Although groups and teams are sometimes used interchangeably, there’s a world of difference between them. In a group, people work independently and they do as they’re told. Plus, each individual should take responsibility for his own job duties. But in a team, people work together to achieve a common goal. They’re committed to one another, whereas there’s barely a sense of community and social cohesion among the members of a group. Positive organizational culture can bring people together and turn you into a team.
Types of Organizational Culture
Since there are various types of personalities, organizational culture can be grouped into several categories. Here, we explain a few types of company culture.
1. Clan Culture
At the core of this organizational culture lies the idea that “we’re all in this together”. Clan culture, as the name suggests, focuses on collaboration and integration. Moreover, it offers a flexible workplace environment which is pretty receptive to new ideas. Therefore, you often see this type of culture in small organizations and startups. To develop this culture in your company, you should communicate with your employees and open yourself up to feedback.
2. Adhocracy Culture
This type of organizational culture focuses on innovation. In other words, most companies with adhocracy culture use the latest methods and equipment. These companies hire creative employees and are always looking for ways to become the cutting edge of their industry. To achieve this objective, they should be willing to take risks. So, in some cases, they may fail to execute their strategies.
3. Market Culture
Companies with this type of culture want to become the best in their industry. So, their goal is to beat the competition and become the market leader. That’s why, they don’t really care about internal satisfaction. Instead, external success is what really matters to them. Employees working in such a workplace environment may end up feeling fed up and overworked.
4. Hierarchy Culture
Hierarchy culture refers to a rigid structure within an organization. In other words, it focuses on control and stability. In contrast to clan culture, companies developing hierarchy culture are hardly flexible. They don’t practice creative thinking and usually avoid taking risks. Also, employees must follow a dress code in the workplace.
Final Thoughts on Organizational Culture
Since organizational culture demonstrates the shared values of a company, developing positive company culture is of great importance. Good company culture can help boost your sales. Also, it gives you the opportunity to reach out to talented job seekers. Keep in mind that maintaining your company culture is everyone’s responsibility.