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What Is Corporate Culture, Exactly?

19 Jul 2021

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An organization's culture or the workplace culture is the mode of operation and the soul of this collective of humans. Every business has a culture, and every culture is different. It is the unique way of behaving and acting within every organization. Corporate Culture is a set of characteristics that makes the company unique, and above all, it is the repository of decisions and behaviors.

Pragmatically, it is the framework allowing all employees to be aligned and autonomous. It is, therefore, both the playing field and the rules of the game for the company. Finally, this is what makes the company unique in the eyes of customers and stakeholders. Corporate culture is the source of a company's differentiation. It can make or break a company, and therefore it must be dealt with sensitivity across all areas.

So how exactly do we define corporate culture? In the business world, it is defined as a set of values and a sum of experiences. It is a living heritage made up of codes, elements of languages, references, and anecdotes. It is vital to allow workers to understand each other fully, cooperate effectively, and participate in creating a feeling of belonging between the members of their team. This company culture exists within all industries, and often a culture change is vital for growth. The desired culture can do wonders for a business.

"A strong culture allows all employees to think like a founder and make the right decision on a day-to-day basis" Kevin Duchier (HRD of Germinal)

A unique culture is not limited to the values or the raison d'être of the company. Still, it incorporates all the fundamentals creating the framework that allows any employee to be aligned and autonomous. The components of the corporate culture are multiple: history, the context of emergence, internal rites of passage, values, codes of conduct, and communication style.

The components of a corporate culture include values, purpose, vision, ambition, value proposition, organizational behavior, corporate personality, and so on. Some critical factors to consider are:

  1. What is the vision of the company?
  2. What are the company’s ambitions and its strategic objectives and metrics?
  3. What are their values?
  4. What are their organizational methods, goals, and mission statement?

Analyzing a corporate culture means identifying each of its components and seeing how they are communicated, embodied, and used. A corporate culture, if it is transparent, authentic, and deployed internally and externally, generates the confidence of employees and customers and their loyalty. Inspiring is a source of attractiveness and commitment. It constitutes a standard frame of reference that facilitates decisions, enables alignment, and is essential to be able to change things for the better.

One thing that successful companies have in common is impeccable company culture. They stand out not only by the innovation of their offer or their production efficiency but also by an identity as coherent as it is endearing. Concretely, the role of corporate culture is to:

  • recruit or retain more efficiently
  • increase engagement
  • develop collaboration between teams
  • increase autonomy and accountability
  • succeed in working remotely - have an impactful and authentic communication
  • make a success of a transformation

Who is responsible for corporate culture?

Well, initially, you may believe it is down to the team in HR. However, while they do dictate certain elements, the company leaders, including the CEO, have a responsibility to provide an impeccable company culture throughout every aspect of the business. After all, it is the CEO and business leaders that must take into consideration the company's values and the work environment, including any issues and problems. To create the desired culture, the bosses, stakeholders and human resource teams must come together to establish a healthy corporate culture or culture change.

However, managers cannot just talk about a culture of innovation. They have to shape it. Creating a culture of innovation requires a change in the system because individuals' beliefs about innovation are linked to beliefs in other aspects of the system (involvement and motivation, learning, initiative, etc.). In other words, the strong involvement of key functions of the company in the innovation process is no longer in doubt.

What Role Does HR Play In Corporate Culture?

HR plays a large part in corporate culture as they are often the first port of call for staff and team members who have problems. Whether it is issued with other staff members, wage issues, time management, and more. Intranet, charters, seminars, many are the steps that HR should undertake to shape it well. Their job is to please the staff, keep things calm and offer a pleasant working atmosphere. But the corporate culture, also called organizational culture, is constantly in flux.

This is the whole issue for HR, the corporate culture is not just words and events, it is much more than that. Corporate culture arises as a management tool. For HR, the strategy consists of being attentive to the aspirations of employees, promoting the environment, and collaborative work. They must develop a “family” spirit around the company. A strong corporate culture is all the more necessary in terms of competitiveness and performance.

Difference between organizational culture & corporate culture

The development of organizational culture must become a priority for any organization. Corporate culture is sometimes referred to as organizational culture and the line can be slightly blurred. Organizational culture often refers to issues such as the position of the office desks, as well as work activities, dress code, working hours, and any company events and parties. It also governs aspects such as workspace design and employee benefits.

Organizational culture is generally described as the set of beliefs, values, and attitudes of a company, and how these influence employee behavior. Therefore, they differ slightly. Organizational culture affects the experience of those who interact with the organization such as the shopping experience of the customer or the collaboration of a supplier. Companies rarely define their culture explicitly. Rather, culture tends to emerge from the beliefs, ways of thinking, words, and actions of people.

Corporate culture differs in this way. This is about the systems used, the processes in place, protocols, and more that drive companies forward. It may focus on areas such as workflow, infrastructure, communication, and training. It is more of the logistics behind the company’s working ethos and finding a shared value.

What is the difference between a good company culture and a bad company culture?

To answer this question, we must first define what bad company culture is. They can, thankfully, be easily defined. An unhappy working environment with poor employee engagement and poor teamwork. This may include no motivation within the company, no incentives for staff, zero perks, and a poor business strategy. Some poor company cultures include:

High employee turnover

The best talent doesn't want to work for a company with a bad corporate culture. To combat turnover and toxic work culture, companies must ensure that team members receive high-quality training, tools, and development opportunities. From managing the administration of career advice to career paths written by HR professionals, there are many ways to reduce employee turnover and tackle toxic workplaces.

Improper communication

Good communication is necessary for collaboration and business success. A clear warning sign of bad corporate culture is the lack of communication. While employee engagement can suffer in the short term, in the long term, team members can choose to quit.

Incompatible values

The core values of a company must be reflected in its strong corporate culture. For example, a company might say that its company focuses on fairness, but then chooses not to give its workers a living wage.

Poor work/life balance

Examples of unhealthy work-life balance include team members who work regularly without pay or are given increasingly unrealistic deadlines. While executives may think that pushing employees to their limits is the best way to achieve a return on investment, it often isn’t. These consequences can result in staff leaving and unhappiness.

Negative working environment

The physical work environment greatly influences the overall culture of the company. A cramped, dirty, or unwelcoming office space can quickly deter employees from wanting to work there. HR can work with bosses to eliminate this by utilizing business capital to help the staff. It can also be adapted for startups - businesses must start as they mean to go on.

What are the 4 types of corporate culture?

The 4 types of corporate culture each define how the company operates and bears the name of a Greek god according to his history and personality.

  1. The clan: the “Dionysos” corporate culture

The objective is to promote long-term cohesion and to let everyone express themselves freely to achieve their goal. This means that we do not impose a specific organization. Everyone is free to manage their work and their schedule in the best way according to their character and their way of working.

  1. Adhocracy: the “Athena” corporate culture

Here, managers have a long-term vision. They declare war on the competition by ensuring that their teams are constantly motivated to go into battle. This corporate culture emphasizes innovation, creativity, but also flexibility for all staff members, including cultural fit.

  1. The market: the “Apollon” corporate culture

This time, it is the organization that takes precedence, an organization that puts itself at the service of performance and the service offered to the customer. This corporate culture adapts to specific sectors of activity, in particular very competitive sectors. The objective here is to do everything possible to beat the competition and establish itself as a leader in its sector.

  1. The hierarchy: the “Zeus” corporate culture

This Zeus-like corporate culture has one major advantage: it is reassuring. Everyone is in their place and must achieve their mission. However, it is the commitment of the teams that promote the success of a discount. It is this commitment that makes you want to get involved in projects and achieve goals to develop the company's turnover.

5 advantages of a solid corporate culture?

Your company culture is essential because talents and customers today favor the best companies with authentic and meaningful values and are not loyal to organizations with a front culture. Corporate culture has many advantages including:

  1. The productivity of the teams, by clarifying the framework and the mode of operation, by reducing tensions and promoting autonomy
  2. Recruitment costs are given increased attractiveness, more successful recruitments, and greater loyalty meaning higher employee retention
  3. Absenteeism due to greater motivation and greater pleasure at work
  4. The cost of customer acquisition due to a greater capacity to attract
  5. Customer loyalty due to greater trust and resonance

Corporate Culture Models

There are some models of corporate culture which include:

  • The Cultural Iceberg Model: This is inspired by the icebergs found in polar seas. An iceberg has visible parts on the surface of the water and invisible parts that are underwater. Often, up to 90% of an iceberg’s actual area remains hidden underwater. Culture and behaviors also have both visible and invisible components.
  • Hofstede’s Model: This model focuses on five main dimensions: Identity, power, gender, uncertainty, and time. You can think about cultural value dimensions on a scale or a continuum, where one aspect of the value lies on one side of the scale and the other extreme lies at the other end of the scale.
  • The McKinsey 7S Framework: This model seeks to use seven key elements – Structure, Strategy, Skill, System, Shared Values, Style, and Staff. The organization’s values are at its core.

What are corporate culture challenges?

The first challenge is for company managers to become aware of the importance of company culture and adopt a good management style. When the business grows, there is a frequent risk of losing what made it successful. This results, for example, in tensions between old and new hires. The main source for improving your corporate culture is to ensure that it is not limited to a restricted circle around the manager but that it is adopted and used in practice daily by all the teams.

The challenge is won when referring to culture as a real reflex for everyone and when it is integrated into all processes. Finally, it is difficult to preserve the soul of the company over time, which is its essence. Culture is fragile and can be lost. The most frequent causes of endangerment are the completion of numerous recruitments without cultural compatibility, the appointment of a new manager, the merger with a company, excessive financialization.

Here are some mistakes to avoid when it comes to corporate culture:

  1. Believe that it is only an HR or communication subject (and not a general management subject concerning the whole company)
  2. Quickly put some aspirations on paper and do not do in-depth work of authenticity
  3. Believe that it is something that simply needs to be explained and that then it is over
  4. Do not be exemplary or take decisions contrary to the culture of the company
  5. Recruit without taking into account cultural compatibility
  6. Thinking that it is only useful internally so it is just as important for the external (communication, customers, suppliers, relationship with shareholders, partners)
  7. Carry out a financial transaction or a transformation without taking into account the cultural aspects

Steps to starting to change your corporate culture

Do we create or do we decide on corporate national culture? When starting a business, it is quite possible because the corporate culture is then very close to that of the leaders. Very quickly, every organization inherently has a corporate culture. It is about risk-taking for the greater good. It is, therefore, less a question of creating a corporate culture than of clarifying it and using it in practice.

Here are 5 steps we recommend to create and implement a corporate culture :

  1. The first step is to clearly define each of the components of the corporate culture and to verify its adequacy with that of the corporate director for better teamwork.
  2. The second is to explain it for example in the form of a culture code/culture book
  3. The third is to communicate it and fully assume it
  4. The fourth, to deeply implement the corporate culture, is to apply it internally in the organization as well as externally to all stakeholders.
  5. The fifth is to constantly maintain the flame for example through the exemplary nature of leaders and managers and to ensure that it evolves as soon as it is necessary, for example during a strategic pivot.

The bottom line is that if you can become focused on setting up a corporate culture, you can bring it to life!

Well, initially, you may believe it is down to the team in HR. However, while they do dictate certain elements, the company leaders, including the CEO, have a responsibility to provide an impeccable company culture throughout every aspect of the business. After all, it is the CEO and business leaders that must take into consideration the company's values and the work environment, including any issues and problems. To create the desired culture, the bosses, stakeholders and human resource teams must come together to establish a healthy corporate culture or culture change.

However, managers cannot just talk about a culture of innovation. They have to shape it. Creating a culture of innovation requires a change in the system because individuals' beliefs about innovation are linked to beliefs in other aspects of the system (involvement and motivation, learning, initiative, etc.). In other words, the strong involvement of key functions of the company in the innovation process is no longer in doubt.

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