Organization culture is the sum total of what an organization represents and demonstrates in all its actions either verbal or non verbal to all its stakeholders. Organization culture is the behaviour of individuals who are part of an organization and the meanings that people attach to their actions. Culture includes the organizational values, vision, norms, working language, systems, symbols, beliefs and habits. It is also the pattern of such collective behaviours and assumptions that are taught to new organizational members as a way of perceiving and even thinking and feeling. Organizational culture affects the way people and groups interact with each other, with clients and other stakeholders. For multinationals that have global presence, culture provides the uniform thread that creates a unifying bond and a sense of shared purpose.
Edgar Schein (1992) defines culture as a pattern of shared basic assumptions that a group learns over a period of time as it solves its problems of external adaptation and internal integration that has worked well enough to be considered valid and therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems. It includes the organizations behaviours and artefacts, espoused values and assumptions and beliefs.
Every organization has to invest time, effort and energy in building a culture that reflects its business strategy and what it stands for. Organization culture is consciously built. Senior management of the company spend a lot of time in defining what the organization stands for. Business goals which are the reason the etré are defined and the way they are to be achieved are also laid out. An organization's vision, mission, values lays out a basic framework that defines the culture of the company and the way the organization has to function. It defines the way the employees that work for it behave. For example, how much time does the CEO spend with internal and external customers? How many innovations have taken place and patented in the company's name? What kind of rewards and recognition and celebration that is attached to it. These fundamentals then over a period of time define the organizsation culture.
The leader's role
Leaders play a crucial role in developing and maintaining culture, and are the living examples of what the organization stands for. They need to adapt, adopt, actively manage and reinforce regularly. The personality of senior leaders and they way they function has a big impact on the way business is conducted. It is extremely important for CEOs to walk the talk and demonstrate live examples. Senior management has a major role to play in influencing employees and the way employees experience the company. This is how great places to work and great institutions are built. The organization culture determines the quality of employees who will work in the organization as well as who can join the company as well as the tenure of employees in the organization The culture, defines whether to provide growth job rotation, enlargement, secondment innovation to its employees, for example, Proctor and Gamble, Google, American Express to name a few. The laid out norms that sanction/ discourage member behaviour in the context of decision making and patterns of behaviour/ interaction amongst members is well defined. They also play a key role in shaping the culture and in harnessing the same for the company's strategy (Meehan et al, 2006). Leadership styles are strong predictors of both competitive and innovative cultures (which in turn are strong predictors of performance) (Ogbonna & Harris, 2000).
Measuring the impact
Organization culture is built in a way that it provides competitive advantage and is futuristic. It must be supportive of the current and future goals of the company. The kind of business the organization is in, should be imbibed and become the DNA of all the employees (and sometimes other stakeholders such as suppliers, shareholders, etc.,) and imperfectly imitable and imitated. For example, an organization in the technology space typically needs to have a culture that supports innovation and agility to define new technologies and quickly bring them to the market. Similarly, an organization in the foods or pharmaceutical industry needs to have a culture that promotes strong quality consciousness and quality processes. In the same breath in the hotel industry needs to have staff who are highly customer service oriented, who put duty before self, for example the staff at the Taj in Mumbai who sacrificed their lives delivering that service during the terrorist attack. A high-performance culture, which enables high performance, is as unique as a fingerprint-it's the one thing about a business that rivals can't copy (Meehan et al, 2006).
Setting clear communication processes
Communication channels play a crucial role in defining the organization culture of a company so that it is cascaded down with the same intent and drive across levels, locations, businesses to mean the same thing. Also for initiating any kind of cultural change, communication processes need to be well established across the organization. For example, during a down turns or when the company is facing competition the way forward, and the game changing plans that will help the organization to surge forward is often the outcome of the organisation culture. Many organizations have not been able to cope with changing times because of the culture that they have promoted and have therefore succumbed to Darwin's survival of the fittest theory.
Every organization has a certain distinct quality to its culture, be it innate, acquired or ascribed for instance. For example, the organization culture of Shoppers Stop is to promote customer service. The visiting cards of all employees have the mandatory designation of "Customer Care Associate followed by the actual designation. This is because good customer service is their core value. Similarly, Holcim across the world follows the same values in every country which are Strength. Performance. Passion.
Organization culture versus organization climate
Organization culture as one understands is the relationship between an organization and the culture it wants to promote. It also means the alignment of the culture with the business goals and the overall strategy that the organization wants to undertake to deliver on its targets to the customers It is also the role of leaders in developing that culture which is unique To align to and shape the strategy of the organization, culture comprises of various characteristics or values some of these values are core and some others are contextual and situational
Organization climate is more the perception of employees towards the practices, policies that the organisation promotes. The organization climate also determines how happy employees are working for that particular company. It also reflects the fairness and the transparency of practices that the organization undertakes. There are thus engaged employees who contribute and make the organization culture what it is, while there are employees who are disengaged and will try to make noises to ensure fairness or they will take action by voting with their feet, and there will be passive employees who are waiting to change sides depending on the organizational environment.
Culture is what creates the glue that binds the organization together by defining what it stands for to its employees, customers and other stakeholders and how the organization interacts with each of these stakeholders. Culture has to be the way of life for employees in that particular organisation. It has to be flexible to welcome change and adapt to the changing dynamics in the market place and the environment. Organization culture also defines the business strategy and competitive advantage that an organization will undertake to distinguish itself in the marketplace. This is why leaders have a key role to play in developing, maintaining, enforcing and modifying an organization's culture. Also, while shaping a firm's culture the core cultural values and contextual cultural values must be defined and ingrained in the behaviours of employees. Different core cultural values like innovation and risk-taking, flexibility, ethics, trust and simplicity act as a competitive advantage for the organization by empowering and engaging employees and impacting the organization's growth and performance in several ways.