What is Corporate Culture?

Corporate culture is the collection of values, beliefs, ethics and attitudes that characterize an organization and guide its practices. To some extent, an organization’s culture can be articulated in its mission statement or vision statement…
History of corporate culture
It’s difficult, if not impossible, to establish specifically how the notion of corporate culture first took hold. Some credit Elliott Jaques, a corporate psychologist, researcher and consultant, for identifying the phenomenon and labeling it in his 1951 book, The Changing Culture of a Factory.
The concept of corporate culture, and the study of it, evolved throughout the second half of the 20th century. It was influenced by related academic disciplines, such as business psychology, and societal trends, such as globalism.
During the past several decades, researchers began to study how certain traits influence an organization’s overall approach to work, the employees it attracts and public perception of the organization.
Researchers also explored why organizations with certain beliefs and practices tend to fare better on key metrics such as innovation, recruitment, employee retention, public opinion and financial success.
Today, executive advisors, management consultants, business schools and researchers all engage in research to better understand corporate culture. These efforts include what defines and influences an organization’s culture and which traits profoundly affect success.
All organizations, whether long-established enterprises, startups, for-profit companies, nonprofit entities or government agencies, have a corporate culture and an opportunity to shape it.
Elements of corporate culture include the organization’s physical environment, human resource management practices and staff work habits. Corporate culture is also reflected in the degree of emphasis placed on defining elements, such as hierarchy,
process, innovation, collaboration, competition, community involvement and social engagement.
A corporate culture that reflects the broader culture is usually more successful than one at odds with it. For example, in the current global culture that values transparency, equality and communication, a secretive company with a strictly hierarchical structure is likely to have trouble recruiting and retaining workers and also appealing to customers and stakeholders.
However, some organizations create unique cultures that break from certain norms and expected best practices. These types of enterprises are often seen as trailblazers and reap a market advantage.
Corporate culture is sometimes referred to as organizational culture, company culture and workplace culture. However, some experts classify workplace culture as a separate idea that narrowly describes the conditions under which employees conduct their work — what has come to be referred to, in part, as the employee experience. According to this view, workplace conditions are shaped by and, ultimately, reinforce the overall work culture.
Many organizations determine and then develop the type of corporate culture they want. They formalize it through statements of shared values and policies designed to put those company values in action.
Other organizations see their culture evolve organically and by chance and circumstance. Such organizations may end up with a poor or even toxic culture because they weren’t thoughtful or attentive about fostering a more nurturing environment.
An organization’s culture determines the way workers behave and what they consider acceptable ways of interacting with each other, business partners and customers. It also determines how the organization reacts to change, evolution and crises and affects the organization’s ability to innovate and succeed.
Types of corporate culture
Experts have identified different types of corporate culture and established criteria for classifying them. For example, the authors of a 2018 Harvard Business Review article, “The Leader’s Guide to Corporate Culture,” built a framework based on a horizontal axis for how people interact that runs from independence to interdependence and a vertical axis for how people respond to change, going from flexibility at the top to stability at the bottom.
The article listed two types of cultures in each of the quadrants.
Starting in the upper-right quadrant and moving clockwise, they are the following:
* Purpose and caring in the quadrant for flexibility and interdependence.
* Order and safety in the quadrant for interdependence and stability.
* Authority and results in the quadrant for stability and independence.
* Enjoyment and learning in the quadrant for independence and flexibility.
The authors described each of the eight classifications in depth. For example, they said a caring culture focuses on relationships and mutual trust, while a culture of authority is defined by strength, decisiveness and boldness.
The authors cited online retailer Zappos as exemplifying a culture of enjoyment, the grocery chain Whole Foods as a culture of purpose and Disney as one of caring. Meanwhile, financial firm Lloyd’s of London maintains a culture of safety, and pharmaceutical company GSK has a results-oriented culture.
In contrast, University of Michigan professors Robert Quinn and Kim Cameron identified the following four types of corporate cultures:
Clan culture. The organization has a familylike atmosphere with a focus on mentoring, nurturing, teamwork and togetherness. The organization and its employees concur on core values and goals.
Adhocracy culture. This is a dynamic and entrepreneurial approach that values risk-taking and an innovation culture. An emphasis on flexibility means employees can create their own initiatives and adapt quickly to changing conditions.
Market culture. This results-oriented approach values competition and achievement. Employees are expected to adopt a competitive mindset and focus on achieving strong individual performance that maximizes profitability for their organization.
Hierarchy culture. This approach uses structures and controls to ensure efficiency and stability. Employees must adhere to established best practices, and processes are controlled in a top-down fashion.
Other classifications of corporate cultures include one described as elite for its focus on high-achieving talent and trailblazing achievements. Another is called horizontal, with its collaborative, nonhierarchical structure. And a third alternative is labeled conventional, with traditional hierarchies and dress codes that reinforce a risk-averse approach… Source:techtarget.com