What Are The Different Types Of Corporate Culture?

What Are The Different Types Of Corporate Culture?

What Are The Different Types Of Corporate Culture?
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Corporate culture is often difficult to define. Find out what corporate culture truly means in the business world and how you can establish your own.

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 type of company culture, and everyone 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.

Corporate cultures range from collaborative cultures to those that emphasize the place of a hierarchy.

Pragmatically, these corporate structures allow all employees to be aligned and autonomous. To put it in sports terms, the type of culture experienced in a business is its playing field and the game's rules. Finally, this chain of command 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 and management levels.

So how exactly do we define an entire organization's corporate culture? In the business world, a culture type 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 create a feeling of belonging between their team members. This company culture exists within all industries, and often a culture change is vital for growth.

The desirable types of company 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," according to 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.

There are multiple components to corporate culture, including 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.

If it is transparent, authentic, and deployed internally and externally, a corporate culture generates employee confidence and customer loyalty. An inspiring status quo is a source of attractiveness and commitment.

Any type of company culture constitutes a standard frame of reference that facilitates decisions, enables alignment, and is essential to change things for the better.

One thing that successful companies have in common is impeccable company culture. These types of cultures 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?

At a surface level, you may believe it is down to the team in HR to create happy employees. However, while HR professionals do dictate certain elements, the company leaders, including the CEO, are responsible for providing an impeccable current culture throughout every aspect of the business.

After all, the CEO and business leaders must consider the company's values and the work environment, including any issues and problems. To create the desired culture fit, the bosses, business goals, stakeholders, and human resource teams must come together to establish a healthy corporate culture or culture change.

However, the layers of management cannot just talk about a culture of innovation. They have to shape it. Creating a culture of innovation requires a change in the system, as 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 upper management and the company's key functions 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 when there is competition between employees and for staff and team members who have problems. HR interventions are issued to other staff members, wage issues, and time management within a competitive environment.

Corporate culture stages

There are many steps that HR should undertake to forge an innovative culture, including intranet, charters, and seminars. Their job is to please the staff, keep things calm, and offer a pleasant working atmosphere in the broader culture, among other common types of HR roles.

But the corporate culture, also called organizational culture, is constantly in flux.

Pleasing words and impressive documents alone don't create strong cultural drives. Corporate culture arises as a fundamental management tool. For HR, the internal focus strategy consists of being attentive to the aspirations of engaged employees, promoting the environment, and collaborative work.

They must develop a "family" spirit around the company. Strong orgonizational culture is all the more necessary in terms of competitiveness and performance.

The 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.

An organizational culture type is generally described as the set of beliefs, values, and attitudes of a company and how these influence employee behavior. Therefore, they differ slightly in their business objectives.

Organizational culture affects the experience of those who interact with the organization, such as the customer's shopping experience or the collaboration of a supplier. Companies rarely define their culture explicitly. Rather, culture tends to emerge from people's beliefs, ways of thinking, words, and actions.

Corporate culture differs in this way, as it relates to 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 to do with the logistics behind the company's working ethos and finding a shared value.

What Is The Difference Between A Good Company Culture And A One?

To answer this question, we must first define bad company culture. Both types can, thankfully, be easily defined.

A bad company culture has an unhappy working environment with poor employee engagement and flawed teamwork. This negative workspace may include a lack of 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. Companies must ensure that team members receive high-quality training, tools, and development opportunities to combat turnover and toxic work culture.

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 a lack of communication. While employee engagement can suffer in the short term, team members could choose to quit in the long term.

Incompatible Values

A company's core values must be reflected in its strong corporate culture. For example, a company might claim that it focuses on fairness but then chooses not to give its workers a living wage.

A good way to mitigate this professional hypocrisy is to pore through your company values and establish whether they have been properly implemented in your company or not.

You can find the answers through employee questionnaires, interviews, and surveys.

Poor Work/Life Balance

Examples of unhealthy work-life balance include team members who regularly work 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.

However, beyond a negative human experience of your company, these direct violations can lead to severe legal repercussions when dissatisfied former employees take you and your business to court.

Negative Working Environment

The physical work environment dramatically influences the company's overall culture. A cramped, dirty, or unwelcoming office space can quickly deter employees from wanting to work there.

HR can work with managers to eliminate this by utilizing business capital to help staff. This helpful system can also be adapted for startups, and businesses must begin in a sustainable manner.

There might be negative elements in your business that are harder to spot than messy offices. Some employees may be bullying each other, the food quality at the company cafeteria could be poor, or the office climate could be too cold or hot.

What Are The Four Types Of Corporate Culture?

The four types of company culture each define how the company operates and bear the name of a Greek god according to their history and personality.

Corporate culture values
  1. The Clan Culture: the "Dionysos" corporate culture

This familial type of culture aims to promote long-term cohesion and let everyone express themselves freely to achieve their goal. The Clan Culture does not impose a specific organizational culture, either.

Everyone is free to manage their work and schedule in the best way according to their character and way of working.

  1. Adhocracy Cultures: the "Athena" corporate culture

Managers have a long-term vision in adhocracy cultures. Companies that maintain adhocracy cultures declare war on the competition by ensuring that their teams are constantly motivated to go into battle.

This corporate culture emphasizes innovation, creativity, and flexibility for all staff members, including cultural fit.

  1. The Market Culture: the "Apollon" corporate culture

A market culture ensures that the organization takes precedence, putting itself at the forefront of performance service and the service offered to the customer.

Market culture adapts to specific sectors of activity, in particular very competitive sectors. The objective of market culture is to do everything possible to beat the competition and establish itself as a leader in its sector.

  1. The Hierarchy Culture: the "Zeus" corporate culture

This Zeus-like hierarchy culture has one major advantage: it is reassuring. Everyone in a hierarchical culture is put in their place and must achieve their mission.

However, the teams' commitment to hierarchy culture promotes the success of a common shared goal. This commitment makes you want to get involved in projects and achieve goals to develop the company's turnover.

Five Advantages Of A Solid Corporate Culture

Your company culture is essential as talent and customers alike today favor the best companies with authentic and meaningful values. People will not be loyal to organizations with a front culture.

Corporate culture has many advantages including:

  1. It increases the productivity of teams by clarifying the framework and the mode of operation and reducing tensions while promoting autonomy.
  2. Recruitment costs become justified by more successful recruitments and greater loyalty, meaning higher employee retention.
  3. Lower absenteeism due to greater motivation and greater pleasure at work.
  4. A lower customer acquisition cost due to a greater capacity to attract candidates.
  5. Stronger customer loyalty forged by a greater company trust and resonance.

Corporate Culture Models

There are a few models of corporate culture, which include:

The Cultural Iceberg Model

This model 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.

Up to 90% of an iceberg's actual area often remains hidden underwater. Culture and behaviors also have both visible and invisible components.

Hofstede's Model

This model focuses on five key 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 a business grows, there is a high risk of losing what made it successful in the first place. This results, for example, in tensions between old and new hires.

The best way to improve 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 teams.

The challenge is won when everyone refers to culture as a real reflex 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 cultural endangerment are the completion of numerous recruitments without cultural compatibility, the appointment of a new manager, a merger with an incompatible company, and excessive financialization.

Mistakes To Avoid Regarding Corporate Culture

Corporate culture mistake to make
  1. Believe that it is only an HR or communication subject and not a general management subject concerning the whole company.
  2. Quickly jot down a few aspirations on paper without conducting in-depth authenticity work.
  3. Assume that it simply needs to be explained to employees to be installed.
  4. Refuse to be exemplary or take decisions contrary to the company's culture.
  5. Recruit without taking cultural compatibility into account.
  6. Assume that company culture is only applicable internally, ignoring external factors like communication, customers, suppliers, relationships with shareholders, and partners.
  7. Carry out a financial transaction or a transformation without considering the company’s cultural aspects.

The Seven Values Of A Good Corporate Culture

Let’s now go through Richard Barrett’s model for the seven values of a winning corporate culture. Barrett was inspired by the famous Hierarchy of Needs created by the legendary American psychologist Abraham Maslow.

1. Viability

Sadly, corporate culture cannot thrive unless a company has a stable financial system in place. Managers must pay employees fairly, and the client base must continue to grow.

In order to make it through each quarter with a positive climate, a company must remain as competitive as possible.

2. Relationships

No manager wants their employees to be unhappy with one another. Corporate culture should inspire open communication and support, along with satisfied customers.

Sadly, many companies fail to establish healthy and approachable communication lines, exposing significant flaws in their company culture.

3. Performance

Employees will rarely feel a sense of comradery if their company is performing poorly. Professional pride is the root of any soon-to-be thriving corporate culture.

Managers need to ensure that their employees sincerely wish to be a part of their company and individual teams by keeping everyone’s performance up to standard.

4. Evolution

We all know that technology is advancing at an alarming rate. As the workplace continues to revolutionize with artificial intelligence, automation, and machine learning, so will company culture.

Managers and HR must monitor this progressive organizational relationship in real-time to ensure that everyone understands their place in the business.

5. Alignment

Although businesses consist of various departments and teams, all employees must be aligned on the primary business objectives. All workstreams should have some binding elements or values.

6. Collaboration

Corporate culture needs to instill a sense of common purpose in employees. They must feel like they are part of a greater mission rather than working away in their separate cubicles without solidarity.

Managers need to present their quarterly objectives inclusively, with a clear outline of how all the company’s moving parts work together.

7. Contribution

Never underestimate the importance of Corporate Social Responsibility (CSR) in fostering corporate culture. People are more likely to forge collective bonds when working toward something greater than company objectives.

Steps To Starting To Change Your Corporate Culture

Is corporate culture created or chosen? When starting a business, you can create your own brand of corporate culture, preferably one that is close to your heart as a leader.

Very quickly, every organization inherently grows 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 five steps we recommend for developing and implementing a corporate culture:

The levels of corporate culture
  1. The first step is to define each corporate culture component clearly and verify its adequacy with the corporate director's values for better teamwork.
  2. The second is to explain it, for example, in a culture code/culture book.
  3. The third is to communicate your corporate culture and fully assume it.
  4. The fourth step involves deeply implementing the corporate culture. You should apply it internally in the organization as well as externally to all stakeholders.
  5. The fifth is to constantly maintain the momentum through the moral nature of leaders and managers and to ensure that it evolves as soon as 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!

Conclusion

Corporate culture might seem like a nebulous concept, but it is made up of relatable and foundational aspects of your company and the people that work for it.

Businesspeople must become responsible for forging their own corporate culture, rather than just leaving this monumental task to HR. Although HR professionals are integral to this creative process, management must have a hands-on role too.

Your corporate culture should be noticeable and appreciated throughout every aspect of your business. After all, a business’s CEO (and its other leaders) must consider the company's values and the work environment while dealing with any professional issues and problems.

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