Organizational culture is 'the way we do things around here'

Dr B K Mukhopadhyay

(The author is a Professor of Management and Economics, formerly at IIBM (RBI) Guwahati. He can be contacted at m.bibhas@gmail.com)

Dr. Boidurjo Rick Mukhopadhyay

(The author, international award-winning development and management economist, formerly a Gold Medalist in Economics at Gauhati University)

The multi-dimensional concept of organizational culture is not a 'one size fits all' concept, and therefore no 'correct', 'proper', or 'standard' organizational culture exists; a successful organization can build a culture with strongly held core beliefs, norms and values that are practised and sustained over time - and these must allow the organization to achieve its larger mission and goals.

Understanding organizational culture

Culture could be also built or/ and influenced by the beliefs and vision of the founder of an organization e.g., how they set the organization's rules, the structure, and the choice of people they recruit. One good case in this context would be Ben & Jerry's Ice Cream that we all love. The company was founded by Ben Cohen and Jerry Greenfield. Initially, they set up their ice cream store in a renovated gas station in Burlington, Vermont. Due to their innate social convictions, they decided only to buy from the local farmers and also share a part of their profits to charities. These values can still be observed in the company's devotion to social activism and sustainability today. When Unilever acquired Ben and Jerry's in 2000, both components of social activism and the use of environmentally-friendly remains unchanged. Similarly, for TOMS, whose slogan is 'One for One', since they give away one shoe to a poor child for free, for every shoe they sell.

Besides effective Leadership, Strategy, HR planning, actionable business ethics – it is an organizational culture that tends to typically differentiate the extraordinarily successful and long-running companies from others. Organizational culture can be a competitive advantage and often sold as a company's USP to attract the best talents in the industry. Sir Richard Branson of Virgin once said, "Train people well enough so they can leave, treat them well enough so they don't want to". Organizational culture affects the way people and groups interact with each other, with clients and all stakeholders on a regular basis. Culture also tacitly influences how much employees identify themselves with their organization. Simply put, organizational culture is "the way things are done around here" in organizations.

Culture is how organizations do things. Bruce Perron opined, "Organizational culture defines a jointly shared description of an organization from within."An organization's culture can be designed and leveraged that needs to be sustained. Culture is a complex variable and is not simply the result of the organization's people, processes or structures, it also affects employee engagement, motivation and retention. Consequently, it also, directly and indirectly, determines the company's larger goals of strategic expansion, performance, HR planning and even market reputation.

Organizational culture can be perceived as the personality of the organization. "Organizational culture is the sum of values and rituals which serve as 'glue' to integrate the members of the organization", a rather simple yet comprehensive way to define culture, as put by Richard Perrin. Culture is generally comprised of the assumptions, values, norms and tangible signs (aka, Artefacts) of organization members and their behaviours. Artefacts are the core business activities, processes, philosophies and rituals that characterise how an organization does things daily.

"What is the culture of your company?" There is no quick response. Culture is one of those terms that's difficult to express distinctly, but everyone knows it when they sense it. It is interesting to note how each and every single organization or broadly speaking, institution, have their own culture. Universities, IT companies, manufacturing units, airliners, sharing economy platforms, etc. Some aspects of culture can be felt through 'artefacts', i.e., the more visible aspects of culture, e.g., how members dress, what the adverts brag about, the arrangement of workplace (gym, swimming pool, free cafeteria in Google's offices).

Types of culture

Sustaining a well-formed culture concurrently remains equally important. Managing a company's organizational culture traits involves identifying 'artefacts'. Aligning the artefacts in line with current business goals is one way to manage culture. Typically, three concepts of culture can be noted during the process. First, social culture – this studies class distinction and the distribution of power that exists in any group and its members and active participants. Second, material culture - this reviews achievements and participatory culture within a workplace. A closer lens should show how people in a group setting achieve, work together and create a peer-support environment. Finally, ideological culture – this looks at the very core by revisiting a group's values, beliefs and ideals. It can include emotional, intellectual and also ethical guidelines that determine people's behaviour in a setting on a daily basis.

In an organizational context, organizational culture can determine and govern how employees serve customers, how they behave with customers and co-workers, how they peer-to-peer support each other, how they monitor their motivation levels, and if they fit and align with the company's goals. Equally importantly, to determine how employees feel about the rewards structure, and also how constructive feedback and some level of criticism can help develop a mindset of growth. "Organizational culture is civilization in the workplace," well put by Alan Adler.

Further examples

Some examples would galavanize further on the concept. Zappos is a popular choice of company for new recruits, the company claims that "Zappos is a customer service company that just happens to sell shoes". Zappos hires for culture first, treats employees to a three-day culture camp training event, and regularly features employee contributors in a culture series for its blog. Managers also guide career paths within their departments for all employees and reward those who perform extraordinarily. Zappos offers new hires $2,000 to quit if they feel the job isn't right for them.

Google would be the next name since any discussion on culture would be incomplete without it. A company that has been synonymous with culture for years, and sets the tone for many of the perks and benefits start-ups are now known for. In the movie 'The Internship' where some of its cultural aspects are shared well. Free meals, employee trips and parties, financial bonuses, open presentations by high-level executives, gyms, a dog-friendly environment and so on. Googlers are known to be driven, talented and among the best of the best. With the increasing tide of Gig Economy, Google also welcome contingent workers called sub-Googlers.

Finally, Adobe is known to challenge employees with innovative and demanding projects, and rewards those who meet the high standards and successfully complete high targets early. Micromanaging is something that Adobe avoid at all costs, thereby trusting employees to do their best with a bit of autonomy. Building trust in employees goes a long way towards positive company culture because trust leads to independent employees who help a company to grow and develop an identity.

The role of leadership in shaping culture

Leadership and culture are strongly correlated. For leaders to influence and maintain a particular culture, they should firstly - identify and emphasize the core beliefs of an organization. This would mean strategically communicating the mission and goals of the company, building trust-building exercises for both middle and junior-level subordinates, talking and reminding of achievements along with actively considering feedback from all relevant levels to gauge and share best practices. Secondly, time and again leaders must realize to reward employees whose behaviours reflect what's important. A recent example, Starbucks rewards (or carrots) an employee refusing to serve a beverage to a customer who was making a racist rant to another customer in one of their US stores, reassures of some core beliefs of the company. Thirdly, align employees with the company's goals and beliefs. It would also include using punitive (sticks) actions on employees who would continue unwanted behaviours. This may range from verbal warnings, written warnings, or even terminating their contracts. Fourthly, the importance of benchmarking by developing a model that lists the behaviours one wants to see at the workplace.

Finally, there is a need for wider considerations addressing equality, diversity, and inclusivity as well. Hiring only those employees who are a good 'culture fit' could stop organizational learning and knowledge building in the wrong run, it is also important therefore to bring in new people who may not be a perfect fit but can clearly be an asset and great counterbalance at your company.