Is Organizational Culture in a Period of Crisis?


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Perhaps as a sign of the times, the word ‘culture’ has been driven into the ground – especially in the corporate world. It seems that every organization, group, and team is being judged and appraised on their given culture, down to the smallest details.

When it comes to an organization, workplace culture is the sum of the values, beliefs, character, and personality of the people of the organization. It is not a characteristic of the organization itself, rather a more complex result of the interactions of all the people of the company. Culture is largely set from the top of the company, and defined by how interactions and values are embedded within the company on a constant basis.

Culture has a huge impact on an organization’s success, it can both strengthen and or weaken how the organization functions. From an HR perspective, it has a significant impact on; talent attraction, retention, performance, engagement, satisfaction, opportunity, and a whole lot more. While everyone can be conscious of how culture works around them on a personal scale, it is a nebulous and complex ecosystem that often evades a clear definition when spread across a larger group (just imagine the cultural scope of a company with 300,000 employees in different continents).

Culture is everything that makes a company unique. It is the result of the interactions, the environment, and the beliefs that operate both on the surface of the organization, and beneath it.

Does Organizational Culture Need to Change?

At first glance, this question has no direct answer. For each individual company, there will always be some element of organizational culture that could or should change. As such, it’s a bit of a redundant question. However, there does seem to be a growing consensus among many companies that work culture does need to change in order to grow, attract the right people, and remain competitive in a market buffeted by AI, robotics, societal pressures, and economic realities.

The pressure to change and adapt to succeed in the modern marketplace has created a clear need for some changes. Whether this is in order to be more competitive, transparent, environmentally friendly or any other factor, is something unique to every organization. Beneath this trend is likely the fact that technologies and social media have totally up-ended the way in which people view the value of an organizational culture. The ‘Glassdoor effect’ is very real, and probably amplified within the narrow causeways of social media algorithms. The companies of today are not only more open to the public than ever before, their cultures are being freely debated in the marketplace.


Source: www.strategyand.pwc.com

What do people mean when they say they want a culture to evolve?

I think this is potentially one of the most important questions all business professionals will need to ask themselves in the upcoming years. If the pressure to change is continuing to rise due to digitization, robotics, and other social factors, then it is natural that certain parts of organizational culture will be pressured to change and adapt.

If there is something within the culture that causes unwanted friction and conflict (I’m not saying all conflict is bad, it is arguably quite necessary for a healthy organization), it’s natural to feel as if things should change. This can manifest itself with a relatively objective question such as: “why do we tolerate managers who contribute to poor performance?” to much more complex questions like: “why do we have a poorly articulated sense of organizational self?”

“Organizations don’t change; it’s the people who choose to change”

Siobhan McHale

These types questions will naturally force an evolution into focus. But in order to more accurately decide what should change and how, each company must define in a measured, and reasonable manner what it is that their ‘culture’ should be. In reality, it is probably not the company that people want to change, it’s certain things about human interactions and processes that people want to change. They want change because they’re unsatisfied with some previous value, and therefore want to present a viable alternative.

Fundamentally, the desires for change reflects more on us a people than anything else. Individuals must first take the responsibility to look within themselves and ask some basic questions of how they wish to interact with their organization and its people. Questions of definition and process will then follow. Nobody’s values remain totally constant (or free of some bias) forever – it is natural to change and adapt over time. People need to have that space to reflect and develop themselves so that they can live the values that will contribute to a healthier organizational environment.

Why is it important to define an organizational culture?

A culture will form in any group whether it is consciously constructed or not. If you wish to change a culture however, the changes must be defined clearly, and evaluated as objectively as possible. If you change any cultural input, you will get a different output. Organizations and HR leaders in particular need to be cognizant of how their company culture is constructed at present, and what steps they need to take to get the desired end state.

The actual changes that take place will result from a detailed definition and review process. For example, if you wish to change your onboarding practices to make them more personalized, it’s essential you map the changes desired, and then plan to implement them to ensure you attain the desired results.

The definition process is also very important because it forces a certain element of critical self reflection and honesty. An organization must be open and objective enough to reveal harsh truths. Observations, meetings, conferences or any structured review process will be an invaluable tool to understanding the environment of change.

Who is responsible for changing a culture?

In sum – everyone, but especially leaders.

If you are looking to make changes to a culture, it is imperative the first initial steps come from the very top of the organization. If senior leaders in the company are not fully invested in whatever changes need to take place, then it is very unlikely that they will be successful. Leaders are the visible purveyors of culture – through their communications, interactions, and relationships with employees and external actors. Leaders are not only a visible guide to the entire organization, but also inform how the company operates. Leaders also contribute to how the general management model shapes the systems, hierarchies, attitudes, philosophies, and goals of the entire organization.

However, it is also important to ensure that you canvas the opinions of those at the bottom of the organization. A bottom-up review of the core values of the organization, led by employees, can be an informative tool to learn more about how the employees understand the purpose and meaning of the company. This can also illuminate how the leadership group’s actions align with the cultural vision of the whole organization. Merging both approaches will likely therefore contribute to a more complete image of the company, and will give employees an added sense of responsibility.

“When you decide to transform a company, you need to take a step back and say – are we ready for this?”

Ingrid Eras-Magdalena

While all employees should have a say in a organizational culture – senior leaders simply must be on board. This is also particularly true for HR leaders. HR professionals have a great position with the organization and the executive to drive cultural transformations. HR can act as a change enabler, providing objective oversight for the business. Leaders can turn values and concepts into actions, and living these actions will bring behaviors to life.

Is there an Organizational Culture Crisis?

On a general basis, no, probably not. The world ‘crisis’ is likely a bit extreme for the majority of cases (though I am sure we all know a company in such a crisis – but they are on the end of the spectrum). It is probably much more apt to consider that organizations are dynamically responding to a market and technological landscape that has exacerbated the pace of change. There are a huge number of ethical questions and business questions emerging at the moment – and people may be externalizing some of that pressure. People however are adaptable and need to be given an environment that allows them to reflect and grow to cope with the market.

Instead of a knee-jerk reaction to ‘change everything’ when the slightest problems or criticisms emerge, HR and business leaders need to clearly and thoughtfully analyse what they wish their culture to be. This step itself is potentially very important, as it leads to a clear and thorough implementation. There are so many tools, resources, great minds, and interesting concepts out there to help your company succeed. It’s about setting the cultural groundwork first – before anything else.

Creating a culture of opportunity, success, performance, and human growth is simply too important to leave to chance.

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The 4th HR Congress Nice, November 19-20 will feature a selection of sessions that will explore this topic and much more! Follow the HR Congress Blog for more interesting ideas and content from around the world of work!

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