Organization Culture - I

How often have you been asked “What is your organisation culture like?” Maybe in an interview or during any informal discussion with one of your friends. 

What are the answers that we generally come up with when encountered with such questions?

“The culture is good, people are friendly, a very open culture in fact.” This comes out when positive and when it has to be negative, it’s like “It’s the worst culture that I have ever seen in my professional career. Incompetent people are sitting at the top. Nobody is aware of his or her work properly. HR and Finance never listen to you and above all my manager doesn’t know anything and he is sitting at that position. Only I know how am I surviving out there?” As if this question has triggered your emotional trauma and you have found a place to throw out all that is lying within.

This is a general reaction that I have quoted when we are encountered with this question. But have we actually given a thought or has somebody taken out time to explain the culture of our organization that we may have been working for quite a long time when it is quite evident from the above statements what impact it makes on the people. 

How many of us actually understand the real meaning of Organisation Culture and further its implications?

May be out of curiosity, some of us will google out for the meanings or definitions of the Organisation Culture after blurting out one of the above stated reaction on this question. 

Let me help you out with this. I will quote a few general definitions that have emerged from the study of some renowned theorists. 

What is organization Culture?

There has been no single definition of Organization Culture and it is difficult to get a consensus on the same but more or less they have settled to similar kinds of definitions as stated below:-

Organizational culture is an idea in the field of organizational studies and management which describes the psychology, attitudes, experiences, beliefs and values (personal and cultural values) of an organization. It has been defined as "the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization. Ravasi and Schultz (2006) stated that organizational culture is a set of shared mental assumptions that guide interpretation and action in organizations by defining appropriate behaviour for various situations. 

Now what do we understand from the above statements? How can we describe our organisation culture on the basis of the above statements/ definitions?

Let’s elaborate on it a bit more than perhaps we will be able to answer these questions. There are commonly two types of cultures stated and understood to exist. They are:-

Strong and Weak Organisation Culture

Strong Cultured organisations are like well greased machines which work very smoothly without any major hitch. They carry a strong belief and employees well align with the organizational values and everybody is well aware of his/ her responsibilities duties and they almost respond to the stimuli of the Cultural values. The employees of Strong Organisation Culture possess a strong belief that the processes they follow or the way they execute their duties is right.  

Whereas in case of Organizations of Weak Culture have employees who don’t find much alignment with the organizational values and generally they are controlled by some strong measures and bureaucracy. 

There are more classifications of the Organization Culture like Soft & Hard Culture, Formal & Informal Culture but more or less they describe the same contradicting aspects of an Organization Culture. I think when there are so many different aspects of looking at Organization Culture that it is very difficult to assimilate all here. So we will not get into definitions and classifications etc. but really would like to understand the difference between a Good Culture and a Bad Culture and the factors that actually influence these.

First we will start with the ingredients that make up the Culture of an Organization.

1. I would like to start with this statement that the “Culture percolates from above and does not move up from below.” So the blame can always be put on the higher management for a Bad Culture? No, because the culture as a whole is built up by all the employees but surely the foundation is the higher management.
2. The Mission/Vision of the Organization that gives a direction, a belief to the organization and its people and in turn the culture. It has been seen that organizations with vague and unrealistic Mission/Vision are uncertain about their way ahead and generally succumb midway.
3.  Policies of an organization are the behavioural guidelines for the employees of the organization which gives a colour to the Culture. It helps any new player on the block to get into the groove immediately.
4. Process/ Procedures provide guidelines for the functioning of the organization. This gives an identity to the organization.
5.  Rules and Regulations may seem to be like restrictions but they are important to rectify the hitched, the spills midway.
6.  State of Organizational Development is the most important and includes all the above stated points. Organization at young, growing, maturing or mature state of development. It directly impacts the Organization Culture.

The above stated points can be concluded as the formal components of the Organization Culture but there are components that can fall under the category of informal components of Organization Culture and have an equally important effect on the same. They are:-

1.  External Environment – It influences as this is where the organization interacts for business.
2.  Industry – Industry as obvious influencer as it determines all the other factors.
3. Size and nature of the Organization’s Workforce is also a great influencer to the Culture of an Organization as it affects the control of the Organization.
4. Technology used as it directly effects the functioning of the Organization.
5.  Leaders of the organization as they are the people who recruit new employees and judge their cultural fitment, the way they react to critical incidents, what they pay attention to, control, the behaviours they model for others, the way the allocate rewards and resources.
6. The Organization History and ownership as it creates a legacy and continues to reflect in the culture of the Organization through cultural transmissions(e.g. rites, stories.)

The above stated factors influence or in other words build up the Culture of any Organization in question. Now the most difficult task ahead of describing a Culture to be the best or better than any other culture as every culture has its unique identity, colour, history and as stated the influencing factors. So vividly it can be said that the Culture is best that suits and works for an Organization. I don’t find much of a difference between the social culture and organization culture. Our social culture has also a great influence on our Organization Culture. 

Now, what we to find is that what is a healthy Organization Culture and how important is it for the success or failure of an Organization?

But, first we have to understand and contemplate that a Culture is build for, by and with the people and not the machines though technology is one of the influencing factors but it also exists for people. 

I will discuss the above question in the next post as I have been pointed out by my readers that my posts tend to get too long at times but before ending I would like to cite a very important case study of Organization Culture for you all to chew over.

One of the great all time example of this is actually between two of the best known companies in the world: IBM and Microsoft. In this example, IBM didn't even necessarily have a terrible organizational culture, but they did fall into several of the traps that caused them to become stagnant.

This example is from the late 1980s. Microsoft was a fairly good company, with revenues in the tens of millions--but a long way from what they are now. At the time, IBM had the largest market share by far with over 80% of the mainframe market. Although long forgotten history by most people, at that time IBM spent a large amount of time and money investing in a software system that was supposed to "take over everything." 

It was called OS/2, and at the time many people complained that there would be no more experimentation because obviously OS/2 would be with every IBM which would put a strangle hold on the industry. Obviously that didn't happen . . . but why? With 80% of the market cornered, an international market, and their own new software, how did IBM not take over?

One of the obvious reasons is Microsoft. Microsoft has done what everyone thought IBM was going to do in the late 1980s. What ended up happening was the OS/2 was really memory heavy and not nearly as functional as it could have been. Bill Gates and Microsoft took advantage of IBM's blunders to take over the market. IBM stopped analyzing its own corporate culture because they were so dominate the thought became "everything we're doing is right," and in retrospect, the higher ups at IBM were completely concerned with internal measures, internal goals, and proving production. 

They were so obsessed with keeping track of how many lines of programming were getting done that many programmers did not write the best of most efficient programming--because it wasn't enough lines!

Meanwhile, Microsoft's entire organizational culture was not focused on bureaucracy, but on getting things done. The bottom line was a better product, followed by an even better product, and so on. While IBM became so entangled with bulkier and bulkier programming and bureaucracy (they even had a class on how to order document manuals from the main company--just to get help). 

Microsoft took advantage by making a product aimed at the customers, not at internal specs. Because of this they absolutely dominated the computer market. IBM had a series of setbacks that resulted in the stock tumbling and the need to hire a complete outsider to re-invent the company.

This is an example where becoming overconfident, falling into dangers of bureaucracy, and internal numbers and goals caused a company that never should have lost its near monopoly on the market to almost bust, while an upstart company who "had no business competing with IBM" according to most sources, had an outstanding organizational culture based on customers needs and getting things done (as opposed to how they were done and measured--IBM's downfall). 

Microsoft is a sample organizational culture that showed how a company could work, and how important that culture was. While IBM has recovered into a great company, the late eighties to early nineties shows the cost of falling into the trap of weak organizational culture.

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