# Role of Culture in an Organisation

## Overview

Culture can play important roles in organisations. It can provide a sense of identity for members. People feel part of an organisation when they share strong organisational values. For example, members of Greenpeace seem to identify strongly with their organisation.

Culture can also generate commitment to an organisation's mission. People sometimes have difficulty thinking beyond their own interests. Their immediate response may be, 'How does this affect me?' When there is a strong culture, people often recognise that they are part of something bigger. They can see how their contribution fits in. Members of Team New Zealand would have had no doubts about the mission of their organisation.

A third function of culture is to clarify and reinforce standards of behaviour. Culture clarifies what is acceptable and expected. It provides guidance on what to do. The way an individual behaves at work may be different from the way they behave at the rugby club.

Gangs have very strong cultures and this affects the way their members behave.

Some of the characteristics of organisational culture can be understood in the following ways.

#### The way people work

Do they follow fixed procedures or is it 'organised chaos'? Are there lots of rules and manuals? Is there bureaucracy and red tape?

#### The way people relate to each other

Are they informal and friendly, or formal and distant? Do they socialise after hours?

#### The quality of people's work

Do people strive to produce high-quality outputs, or is it 'get it out the door'?

#### Physical layout and facilities

Does this reflect hierarchy? Does it emphasise status?

#### The general atmosphere

Is it serious and formal, or relaxed and fun loving? Do people feel it is all right to joke and laugh? Do they feel fearful or threatened in any way?

#### Leadership style

Are managers authoritarian and autocratic? Or is there a more democratic approach?

#### Communication

Are there open communication channels or do people communicate on a 'need to know' basis?

#### Cooperation and collaboration

Do people work well together, or are there warring factions? Is there 'turf protection'? Is there a lot of politics?

### Impact of the environment on an organisation's culture

Organisational culture often develops from an organisation's interaction with the external environment. This consists of sub-environments that include:

- economic environment
- political environment
- legislative environment
- sociological environment
- technological environment
- competitive environment.

As an organisation interacts with its environments, it may find that some values and practices work better than others. For example, Kirkcaldie and Staines (a Wellington department store) may have found a niche for high quality products and excellent customer service. As a result, the firm seems to have developed a deep, shared commitment to customer service. In contrast, The Warehouse may have found that selling moderate quality products at attractive prices works best. Their dominant values may be centred on price leadership.

Another organisation may have a guaranteed customer base. It may not need to compete. In these circumstances, staff can become preoccupied with meeting their own needs and a self-serving culture can develop. This is not to say that it will develop, just that it may be the logical outcome of the organisation's interaction with its environment.

The various environments can be stable or turbulent. These days, they are usually turbulent! Often, managers try to cope with changing environments by making structural adjustments (restructuring, or changing reporting relationships) because they believe it allows them to deliver a new or better service. Managers may also attempt to cope with change by developing new work processes and procedures.

For example, a manager might give their reps laptops and get them to send their work in electronically instead of filling out forms, because they believe it will be faster. All this change provokes a reaction. People are seldom neutral. They are either 'for it' or 'against it.' They adopt a position (an attitude) and act accordingly. And so it goes.

Consider the environments that affect an organisation you are familiar with. Make some notes about the way environmental conditions have affected people's attitudes and the way these attitudes have been reflected in peoples' behaviour.

### Culture and performance

A strong organisational culture can affect performance. For example, culture can determine whether an organisation makes effective use of people, time, and other resources. Culture can help make things happen or it can get in the way. The following situations, for example, may have cultural origins:

- meetings don't start on time
- participants forget to attend meetings
- the organisation tolerates waste and extravagance
- managers micro-manage their staff
- people don't take risks
- people complain about poor communication
- the capabilities of people are under-utilised
- there are high levels of creativity and innovation
- there is very little shrinkage
- the quality of products is high.

Research suggests that to influence performance, culture must be strong. Weak cultures do not seem to have much impact on performance.

Consider also the likelihood that if a person is a cultural misfit, they are unlikely to perform well. They might perform well in another organisation, but not the one they are in.

Of course, culture is not the only determining factor in organisational performance. Culture can be stiff and formal, or relaxed and open. In both cultures, you need good managers. You need managers who can make the best use of people, dollars, time, and other resources. You need skilled people who have access to needed resources. You need committed, motivated people.

[back to top]