What Is Organizational Culture, and How Do I Elevate It?

As a leader, understanding and developing organizational culture is an important part of your business’ success.

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When corporate leaders debate the issue of what is organizational culture, it’s easy to venture down the wrong path. There are many misconceptions about what creates and sustains a successful workplace culture.

To be clear, the components of an organization’s culture are not the visible aspects of the company.The open-office space, mini bar, massage chairs, nap rooms, or fully functional, military tank sitting in the parking lot (yes, this is a real thing at Oakley) are merely visual artifacts of culture. And while they can reinforce your company’s culture, they can just as easily give a false impression the work environment.

What is culture and how is it formed?

Fostering a corporate culture that aligns with your company’s needs is an important undertaking. A business leader must start with an understanding of the term’s meaning. Culture is a system of shared values and assumptions that guide and influence the way organizational members think and behave.

Values refer to the principles and standards of behavior the organization and its members hold (or at least claim to hold).

Assumptions reflect members’ underlying beliefs about the nature of reality. Some examples of assumptions would be the need for transparency, or the importance of collaboration for success. These shared assumptions are key components in determining an organization’s culture.

Many factors shape the pattern of values and assumptions that will emerge among your workforce. Strategically aligning the purpose of your company with your culture is critical. Here are four of the most important elements that cultivate a successful, authentic company culture.

Culture is the culmination of your structure

As your company grows, one of the first questions you will need to answer is how to organize and coordinate work in your growing workforce.

These decisions invariably shape your company’s culture.

For example, deciding to establish formal channels of communication, multiple levels of managerial roles, and a top-down decision-making hierarchy begins forming your company culture. Such decisions will influence existing and future organizational members’ shared understanding of the work environment. Those structures will attract individuals who prefer a traditional, bureaucratic organization with a hierarchy culture. However, it might deter those looking for a less formal organization that allows them more autonomy and encourages them to help make decisions. 

Policies and practices drive culture

The policies and practices the leadership team establishes either reinforces or detracts from the type of culture you’re hoping to develop. One clear example is your company’s hiring practices.

Establishing clear criteria for what you’re looking for in an employee is essential for building the company culture you desire. Some companies market culture from the job description throughout the interviewing process, and that’s a smart move because it attracts people who will likely be a good fit.

You can also shape your culture by reinforcing your company’s mission and core values. Measure those qualities in every applicant and choose the person who fits the role and the culture. Your hiring practices are a key to effectively cultivating your desired culture.

Leaders should make it a top priority to align the policies and practices they set with the desired culture.

You can also shape your culture by reinforcing your company’s mission and core values. Measure those qualities in every applicant and choose the person who fits the role and the culture.

Culture is a function of leadership

Your leadership team and other employees who wield power and influence also shape your company’s organizational culture. As research suggests, employees often look to the majority for cues to acceptable cultural traits. They tend to defer to those around them, such as their direct supervisors, for information regarding appropriate and inappropriate behavior.

Use this “monkey-see, monkey-do” reality of organizational life to your company’s advantage. To shape the business culture you desire, you need to promote people to leadership roles who hold cultural values that are consistent with the culture you want to cultivate. After all, these individuals will set the tone for how the rest of your workforce thinks and behaves.

The founder’s values and beliefs

Finally, one of the most important determinants of your company’s culture is, well, you. As the founder, you likely started your company with a particular philosophy in mind about human nature and the role of business in society.

You also probably identify with a certain culture more than others and naturally lean toward adaptive cultures, hierarchy cultures, adhocracy cultures, or other organizational cultures.

For example, perhaps you held the belief that the key to a successful organization is the need for all members to be involved in decisions and contribute to the success of the organization. This philosophical view is likely to influence many of your decisions. These might include who and how you hire, the policies you institute, how you coordinate work among your workforce, and how open you are to risk. It becomes particularly important for you to carefully reflect on your values and deeply held beliefs, as they will serve as the foundation for your organization’s culture. Make sure you implement specific actions that help build a great organizational culture.

Rather than focusing on the physical manifestations of culture, such as having a foosball table or gaming room in the office space, focus on factors that actually create and enhance the company culture you’re striving to develop.

Encourage employee motivation and employee engagement, and reward employee improvement. If this hasn’t been the company norm, it may be time for a culture change. A happy, fulfilling place to work and a close-knit clan culture take effort to build. It’s important to start at the top and take stock of your organization’s culture. 

Culture change is possible

What is organizational culture? It starts with the company founder’s beliefs, is molded by the organization’s leadership, and further fleshed out by the company’s policies and practices. A healthy culture fosters happy, motivated employees, decreases turnover, and improves productivity. A toxic culture zaps employee morale, increases workplace conflict, and creates a negative psychological environment. Organizational cultural effects are far-reaching, which is why identifying and fostering your company culture should be a top priority.

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