What is Organizational Culture?
A term that is used frequently among corporate psychologists and managers is Organizational Culture. The definition of the term is widely accepted, but there is some disagreement in how effective the concept is in achieving its goals. What is organizational, or corporate, culture and how does it impact corporate identity?
Defining the Term
Organizational Culture “includes an organization’s expectations, experiences, philosophy, and values that hold it together, and is expressed in its self-image, inner workings, interactions with the outside world, and future expectations.” In order for these concepts to bring about unity in a corporation, they must be shared. In doing so, they create a “psychological environment” that is unique and forms the personality of the organization. Culture is how corporations get things done.
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How Corporate Culture is Reflected in the Organization
All organizations have policies or rules about how things are done. Policies may involve how employers relate to the employees, how information is disseminated and even how the company interacts within the community. Sometimes these policies are formal and sometimes they are shown in traditions. The organization runs more smoothly when everyone involved agrees with the policies. Corporate culture is expressed in company values as well. When corporations embrace these shared views, they develop a personality. It is this personality that they reflect in the marketing tool known as branding.
How Culture Affects Productivity
A popular comedy skit portrayed two piano movers hopelessly stuck on a staircase. The problem was that one mover was trying to push the piano up, and the other was attempting to move it down. That is why shared culture is important. Without agreement on company policies, on treatment of employees and other issues, the company works against itself. When corporate culture works, everyone is “on the same page.” Employees understand what company expectations are for them, and they know how much freedom they have in decision-making.
What is the Dissension?
Corporate culture is intended to be a unifying force. One problem that may arise, though, is that the values and policies are only shared if they are interpreted in the same way. If, for instance, a mid-level manager interprets a value differently than the company president, he may make changes in an assembly line or in other procedures. That change will ultimately cause conflict within management and possibly in the workforce. The way in which the organization maintains the integrity of the values and policies is through hiring people that are a good “fit,” and through incentives like salaries and benefits. That is where the dissension between economists begins. Ultimately, corporate culture is enforced through a network of relationships where power is leveraged both to meet goals and to restrict them. Top managers promote their interpretations of these corporate values by using hiring, firing, promotion and incentives. That restricts the interpretation, and also makes it possible for an employee to adhere to the culture because of fear and not because of shared values.
When corporate culture works to create an organizational personality that reflects in productivity and in interpersonal relationships, a bond is formed within the company. Everyone heads “in the same direction.” Company wellness programs, community volunteerism and other activities reinforce the unity. That is the theory behind the concept of Organizational Culture.
