Concept. What is a Corporate Culture?

Transcription

1 Concept Introduction How does an organisation respond when it s faced with change? When confronted by an immediate crisis? When it s under protracted pressure? The answers given to these questions are often leadership centric. Leadership is a critical factor but the sleeping giant is often the nature of the corporate culture that the organisation has. The culture will determine the reflex action that the organisation has to events and it will trigger the emotional response that outsiders have. What is a Corporate Culture? Culture can be defined as: the ideas, customs, and social behaviour of a particular people or society 1 and this definition can be applied to organisations as well. Although the leadership and management of an organisation may influence culture it is the result of the collective behaviour of all of the people interacting within it. A corporate culture will typically have: some sort of public face a veneer typically composed of value statements, mission statements, slogans and marketing. Unfortunately in many cases the veneer can be very different from the cultural substrate. This may not necessarily be through poor management a culture can embody many things not covered in these statements and it s not always easy to encapsulate a culture in words or diagrams particularly for documents such as marketing materials where the message may shift with each next new trend. In many cases however there is a genuine misalignment between the espoused and actual cultures; a visitor s experience when outsiders visit or interact with an organisation they experience an environment and behaviours that indicate the nature of the corporate culture. This may be a direct reflection of the true corporate culture or be somewhat different through sanitisation ; and 1 Oxford Dictionary of English Prominence Pty Ltd ABN PO Box 66 Taigum QLD 4018 T (07) enquiries@prominenceconsulting.com.au Commercial- in- Confidence 2013 Prominence Pty Ltd All rights reserved

2 a core culture people who work in the organisation for any length of time experience the raw culture influenced by the day- to- day environment and behaviours driven by what people really think (but might not be saying). No matter the details of a desired corporate culture the preferred situation is to have the three aspects above as closely aligned as possible with core culture the bulk of the internal and external face of the organisation. Why is Culture Important? A corporate culture will strongly influence how an organisation delivers its services/products and how its people treat each other. Critically, it also influences how an organisation responds to crises, failure, success, leadership direction and change. Corporate culture is therefore arguably the most critical element of an organisation to get right, and yet its intangible nature makes it hard to design and build. How does a Culture Develop? A corporate culture always evolves as a product of its environment. Whilst a desirable culture can be envisaged and strived for and may develop quickly, it will not directly respond to policies and directives. Both the physical and emotional environments in an organisation can influence culture. Obviously people can both influence and develop an organisation s culture, however, whilst the individual character types have an impact it is the way the people interact that usually has the greatest impact. The aspects of a working environment that can affect organisational culture are numerous and may be specific to an organisation, but they often include: corporate materials that seek to establish the culture directly or indirectly in theory mission, vision, values, objectives and plans (or the lack of these things); leadership and management style; the people in the organisation; physical environment conditions under which people work; the organisation s history and inherited legacy both good and bad; the nature of the customer base the organisation has to deal with; the engagement model both within the organisation and with its external stakeholders; and internal or external challenges and threats. Can a Culture be Designed? Culture is the hardest element to change in most organisations typically the larger the organisation is, the harder it is to change. This is because it s about the people and the way they think and feel. An emotional inertia will always exist that makes this sort of change slow. The only 2 of 7

3 exception perhaps being deep rapid change or shared crisis which can galvanise effort and thinking, however, the results may be unpredictable and sometimes for the worse. The characteristics of a desirable culture can be identified and key company documents can reflect these characteristics, but the challenge remains to make people believe it, think it, own it and act it. Considerations for defining a desirable corporate culture are: has a desirable culture been identified? have the characteristics and behaviours that will drive the culture (and result from it) been defined? do the organisation s key documents accurately reflect the desired culture? have the development processes in the points above been undertaken with broad engagement within the organisation? does the organisation actively consider corporate culture in its strategy and planning processes? does appropriate leadership exist? is the leadership undertaking actions to encourage the desired culture? is management skilled enough to support leadership messages, engage staff and executives, and maintain a working environment conducive to the desired culture? are the physical working environment and equipment right for example, if a collaborative culture is desired are there sufficient venues and tools to support it? do the organisational structure, roles, responsibilities, reporting and communication channels enable the type of engagement and information flow for the desired culture? are roles and responsibilities clear and are they realistic and able to be fulfilled with the resources and available? In general organisations are more accepting of approaches and ideas (and change in general) when all parts of the organisation are engaged and trust exists. Talented and charismatic leaders engender trust naturally and can directly influence a desirable corporate culture often subconsciously. However, the larger and more complex the organisation, the more difficult this is without appropriately skilled and experienced managers throughout the organisation. Whilst natural talent and charisma are useful they can quickly come unstuck if they are teamed with poor management and unethical behaviour. It is important to note however that leadership and management skills can be learned and good engagement practices and openness can engender trust. Openness and empathy in managers requires confidence and courage and is an aspect of corporate culture in itself. The structure of the organisation, how it measures itself and the clarity of roles and responsibilities all influence culture. However the careful design of these elements is critical, for example, are the measures, roles and responsibilities achievable and sustainable? Are they the basis for clarity and performance or a control, blame and shame culture? 3 of 7

4 What About the Existing Culture? Astute leaders will have a feeling for the current culture although the accuracy of this assessment may depend on the size of the organisation, the skills of management and the degree of employee engagement that leadership undertakes. Even when a problem with corporate culture is evident it is difficult to accurately assess specific poor elements and the degree of misalignments. It is important to assess: what are the characteristics of the current culture? does the existing culture reflect what is said and implied in corporate materials? is the culture (documented and in practice) appropriate for what the organisation is trying to achieve? When there are issues with an existing culture it is important to understand its true current state and its alignment with corporate direction. How to Get There Corporate cultural development is both a science and an art. Scientific elements exist in being able to understand the factors that influence culture and then being able to develop planned approaches to culture development. However, the complexity and entropy that exist in this people driven aspect of the organisation mean that the ultimate outcomes of any planned actions are far from certain. Sound groundwork will however increase the chances of a positive outcome. This should include: for established organisations, understanding the existing culture. This will usually require objective and confidential engagement with personnel; ensuring that the fundamentals such as mission, organisational objectives and other baseline materials are relevant, realistic, usable and owned ; collaboration with key stakeholders to define a desired corporate culture. A corporate culture can often be more clearly defined by specifying behaviours and outcomes these may be developed through broad engagement within the organisation. Check that the defined culture aligns with the organisational mission, objectives and other materials. As with the development of organisational objectives, strong facilitation capabilities are required to achieve the best outcomes; ensuring that the leadership and management skills exist to drive and support the engagement required to influence culture. This may require training or coaching; ensuring roles and responsibilities are clear with respect to creating a work environment and behaviours conducive to the desired culture. More broadly, ensure management and operational roles and responsibilities are clear and achievable; building organisational capabilities to support the desired culture. This may include HR and communication capabilities; providing the facilities and tools conducive to the workplace feel and capability required by the culture; 4 of 7

5 ensuring that from its conception the desired culture and its behaviours are communicated and understood by all personnel; making sure that all personnel, but particularly management, are mindful that their behaviour and decisions must support the ethos of the corporate culture scepticism will exist while efforts are being made to change culture and sceptics will be looking for evidence of hypocrisy; understanding that persistence is critical; and establishing desirable behaviours and decisions as business as usual once a corporate culture has developed. Critical Issues Changing a corporate culture is often the hardest change of all. The change process is both an art and a science. Highly talented and charismatic leaders can instinctively lead a culture change, although the larger and more complex the organisation the more they would have to be supported by skilled managers and sound organisational design. Where this messianic approach is not feasible a considered approach of science and art can be applied to drive cultural change. The human factors mean that the art of people management becomes paramount, however, as with many artistic endeavours the cultural masterpiece may not develop exactly as planned and yet with good management will still reveal a creative and pleasing result. Critical issues are: understand that a corporate culture is critical to employee s satisfaction with their work, service/product delivery, and how the organisation responds to change, challenges and crises; a culture is most effective when the core culture is close to the visitor experience and the public face presented to the outside world. Significant misalignment between these three aspects will become apparent to any level of scrutiny resulting in confusion, possible damage to reputation and other negative operational effects; cultures evolve through people interacting with each other and their environments. This organic process makes engineering a desirable culture difficult; the process used for defining a desirable culture is in itself important. If an engaged workforce is a part of a desired culture then undertaking this process without engagement is a bad start; physical environment factors will affect culture and these include such things as location, nature of facilities, tools and technology systems consider what physical environment will best foster the desired culture; organisational design will affect culture through: high level corporate instruments such as objectives, mission statements, values statements, strategies and plans are they relevant, usable, aligned and able to influence thinking; 5 of 7

6 organisational structures, decision- making structures, roles and responsibilities and reporting their logic, clarity and ability to support employee engagement; and policies, processes and procedures their integration, management, usability, and ability to support or demonstrate elements of a desired culture (for example, quality, continuous improvement, innovation, equality, etc); it is imperative that leadership and management own and demonstrate the desired culture; leadership and management skills must exist to build trust and create the organisational environment conducive to the desired culture and manage the human issues that come with change; people come with many different life situations and character traits and the desired culture must be one that a diversity of stakeholders can critically examine, accept, own and support; the entropic nature of corporate culture development means that unexpected aspects will develop. These should be examined carefully before any action is taken as a properly cultivated environment means that they will often be beneficial and augment the developing culture; an existing culture must be understood and organisational misalignments identified before an effective pathway to cultural change can be identified; and cultural change requires an holistic approach introduce all the environmental and organisational factors that will support desired behaviours and continually eliminate factors that promote undesirable behaviours. Much like gardening prepare the soil, plant the seeds, tend the seedlings, control the weeds, and more often than not a bumper crop results. Prominence has delivered consultancy services to the public and private sectors since 2003 and has a diverse and highly experienced team of consultants. Key consultancy services include developing strategy, governance and business planning, assessing and building corporate capability and managing people, culture and change. Advisory services, coaching and skilled contracting resources can also be provided. The Prominence website ( provides more detailed information about the complete range of consulting services. Prominence s methodology has elements that are carefully designed to provide numerous engagement points with the organisation during a project. This allows for productive participation by the organisation s personnel to build project ownership, allow stakeholders to understand the process and create the optimal state for acceptance of project outcomes. 6 of 7

7 Other Prominence Documents Further information regarding Prominence can be obtained using the contact details below. The following Profiles are available upon request. Prominence consulting services profile. Prominence document production investigation profile. Panel Arrangement Profiles for Federal, State and Local Government and Government Owned Corporations. The following Concept documents are also available: Change management Targeted surveys and information gathering Document production environment design The paperless office? Business processes: reengineer or improve? Knowledge management Managing processes Client focus Processes, standards, benchmarks and best practices Organisational measurement Flexible processes Usability Determining the scope of a review Knowledge, performance, innovation and risk Simplicity Challenging times Business process management Considering change Organisational health checks The role of the project sponsor Organisational structure design Building project ownership Building capability through skills transfer Usable business plans The benefits of austerity Communication Leadership, management and culture Employee engagement Middle management challenges The useable organisation Issue and crisis management How to choose a consultant Contact Us p a PO Box 66 Taigum Q 4018 w e enquiries@prominenceconsulting.com.au 7 of 7