POWERING WORKPLACE PERFORMANCE

3 MARCH, 2016

GUIDE TO ORGANISATIONAL CULTURE

Organisational culture refers to the shared values and expectations within a company that determine how employees interact with each other, their work and the outside world. Depending on its nature, your culture can either enable or hinder your organisation’s strategy. As culture is the operating system of a workplace, a strong organisational culture is critical to business success.

Here, we’ll take a look at the dimensions of organisational culture, including the advantages of organisational culture, how it impacts employee motivation and how you can optimise the culture of your organisation for financial and operational success.

What is organisational culture?

Organisational culture describes the values, expectations and patterns of behaviour that exist within an organisation. The importance of organisational culture lies in the fact that it directly contributes to business performance. A great organisational culture will boost engagement and productivity, providing leadership with a strong foundation to create an ethical workplace. Meanwhile, a dysfunctional culture can result in high rates of turnover, poor communication, absenteeism and unclear ethical standards.

Benefits of a well-defined organisational culture

Why is organisational culture so important?

Despite the fact that establishing a well-defined organisational culture is a time-consuming investment, its benefits can manifest throughout all areas of business.

More efficient recruitment and onboarding

One of the main advantages of an organisational culture is that it can streamline onboarding processes, including training, orientation and ongoing performance management. By showcasing a clear culture during recruitment, organisations are more likely to attract candidates who genuinely share the same values as the company and are committed to its vision. This honesty actively promotes employee loyalty, ensuring a positive employee experience from day one.

Greater team cohesion and less conflict

When employees are united by a collective identity and shared goals, they are more likely to feel valued for the unique skills they bring to the team.The benefits of greater team cohesion are diverse, ranging from improved workflow and communication to increased motivation and productivity. All of these factors build a strong foundation for honest communication that promotes dialogue and adaptive thinking rather than unproductive conflict. Considering this, it comes as no surprise that team members are 80% more likely to report better emotional wellbeing when compared to solo-workers.

Increased job satisfaction, engagement and productivity

A core component of establishing a strong organisational culture is empowering employees by setting clear and consistent expectations. Employees that are supported by their organisation’s culture are aware of how their individual role contributes to the greater company purpose. They are motivated to engage with their work and collaborate with team members. Enhanced job satisfaction and engagement inevitably leads to increased productivity, as employees are provided with the necessary tools and support to succeed.

Develops positive brand identity

A company’s organisational culture directly feeds into its public image. An organisational culture that conflicts with the company’s brand can undermine customer and stakeholder trust. Technology and social media have made it considerably more difficult for organisations to maintain an inauthentic brand identity. In order to promote a consistent image, organisations must align their brand image with their culture. A positive brand image that is upheld by a cohesive organisational culture will inevitably attract business opportunities from potential partners and stakeholders with similar values.

6 dimensions of organisational culture

According to Geert Hofstede’s Multi-Focus Model on Organisational Culture, there are six autonomous dimensions of organisational culture.

Means vs goal oriented

In a means-oriented culture, people identify with ‘how’ work gets done. They avoid risks and make only a limited effort in their jobs. In a goal-oriented culture, people identify with ‘what’ work gets done. The focus is on achieving specific internal goals or results, even though these involve considerable risks.

Internally vs externally driven

In an internally driven culture, people feel that they know what is best for the clients and customers and act accordingly, and business ethics and honesty matter most. In an externally driven culture, the emphasis is on meeting the needs and wants of customers, results matter most, and a pragmatic attitude prevails.

Easygoing vs strict work ethic

In an easygoing culture, the internal structure is loose. There’s a lack of predictability and there’s also little control and discipline. On the other hand, a strict culture is the exact opposite, with people being punctual, serious and conscious of costs.

Local vs professional identity

In a local culture, people identify with their boss and/or teammates. They’re focused internally and on the short term, prioritising the need to be like everyone else. In a professional culture, people identify with their profession and/or the content of the work. They’re focused externally and on the long term, and do not feel pressure to conform.

Open vs closed system

In an open culture, new employees are welcomed easily as people are inclusive, believing that anyone will fit in well with the organisation. This is reversed in a closed culture, with people being exclusive and newcomers having to prove themselves.

People-oriented vs task-oriented

In an employee-oriented culture, the organisation takes into account its employees’ personal problems and takes responsibility for their welfare, even if it’s at the expense of productivity. In a work-oriented culture, the focus is on high task performance, which can come at the expense of employees.

The importance of company culture in enhancing employee motivation

An organisation’s culture, including its motivational practices and processes, directly affects the motivation of its people.

People work for six main reasons: play, purpose, potential, emotional pressure, economic pressure and inertia. While the first three motives help increase performance, the last three don’t. A high-performing culture maximises the “positive” motives and minimises the “negative” ones, ultimately creating total motivation.

“Positive” motives

The positive motives – play, purpose and potential – are connected to the work itself and will improve performance.

  • Play – You’re motivated by the job itself, and you work because you enjoy it.
  • Purpose – The work outcome fits your identity, and you work because you value the job’s impact.
  • otential – The work outcome benefits your identity or the job enhances your potential.

“Negative” motives

The bad motives – emotional pressure, economic pressure and inertia – are indirectly connected to the work itself and will reduce performance.

  • Emotional pressure – You work because an external force (fear, peer pressure or shame) threatens your identity, and you want to avoid disappointing yourself or others.
  • Economic pressure – An external force makes you work in order to gain rewards or avoid punishment.
  • Inertia – You can’t identify the reason why you’re working.

How to change your organisation’s culture

If you wish to change the culture of your organisation – like modifying the way people behave and work – to gain competitive advantage and achieve long-term financial and operational success, follow these steps:

Firstly, understand your organisation’s culture

Work with and within your current culture by taking the time to understand it. Identify which traits are preeminent and consistent, and determine the types of conditions in which these traits will most likely be a help or a hindrance.

Raise awareness of your new culture

Promote awareness of the new culture by advertising it around your company, including descriptions of the new behaviours, processes, policies and practices to be implemented.

Start changing key behaviours

Change key behaviours relating to:

  • Empowerment: reduce the number of approvals required for decisions
  • Collaboration: set up easy ways to assemble joint projects
  • Interpersonal relations: devise mutually respectful practices for raising controversial issues or grievances

This will ultimately encourage people to start to think and behave in ways that align with the desired organisational culture.

Reach out to informal leaders within your organisation

Utilise your authentic informal leaders who can influence behaviour through ‘showing by doing’ and spread behaviours from the bottom up. But what are informal leaders?

Informal leaders will fall into one of the following categories:

  • Pride builders: master motivators of other people and catalysts for improvement around them
  • Exemplars: role models
  • Networkers: personal communication hubs within the organisation
  • Early adopters: take up and experiment with new technologies, processes and ways of working

Start discussing with formal leaders

Rely on your formal leaders (e.g. managers) to safeguard and champion desired behaviours, energise personal feelings and reinforce cultural alignment.

If people at the top demonstrate the change they want to see, others will be sure to follow. But first, give them time to learn and practice the new behaviours (showing more respect, listening better to others, etc.), assess each person to see where they can improve, and hold them accountable for their actions.

Visibly demonstrate the impact of your cultural changes

Demonstrate the impact of cultural changes on business results quickly so people will continue to implement and believe in them. You can stage a performance pilot, or a high-profile demonstration project, which introduces specific behaviours that you can evaluate and assess. Use a dashboard defining desired impacts, tactics used, and specific metrics to be employed.

Monitor and update your organisation’s culture

Actively manage your organisational culture over time, including monitoring and updating it. This will ensure that your culture is still good enough for tomorrow and beyond. Aligning your culture with current and future strategic and operating priorities can quickly accelerate changes and make them last.

Great company culture starts with great employees

Every single person within a company plays a crucial role in creating its culture. Before an organisation can implement a cultural shift, it must first ensure that its employees have the necessary knowledge, skills and training to contribute to a collaborative culture.