Organizational Culture 101

Every organization has one. Without conscious thought, organizations informally build up over time a pattern defining its typical or preferred operating state. No two organizations are the same – even divisions within a larger organization have distinct cultural elements. Like the grain within a piece of wood – culture gives beauty, texture, strength, and uniqueness to every organization.

Even though it is not expressly described, employees, especially new ones, easily sense the organization’s culture and feel its conditioning impact. Positively – as it communicates the importance of foundational activities and relationships key to the organization’s success. Negatively – as it extinguishes or hinders creative ideas due to pressure to conform to “the way we do things here”.

Culture: A Definition

An organization’s culture is the unique and prevailing pattern of behaviors, priorities, perspectives, values, and interrelationships that have been nurtured over time. Each leadership team leaves its mark on the emerging culture (like the growth rings within a tree). This includes not only its treatment of people and strategic decisions, but also the measurements, policies, and structures it leaves behind to shape ongoing employee activities. This prevailing pattern’s current form has been and is strongly influenced by three key components: Current Leadership, Past Dealings, and Organizational Structures.

1 — Current Leadership

Current leadership strongly affects culture by its ongoing actions, for example:

  • Accessibility – Is decision-making distributed or hoarded?
  • Trust – Are people treated with equity or are political concerns given more weight?
  • Vision – Is there conviction/clarity on the organization’s direction?
  • Feedback – Is communication with employees and staff only as needed or is it constant and broad-based?

Employees and staff react to Current Leadership’s actions (please note that I didn’t say speeches) and fold new information into their assessment. Their assessment is influenced by present management actions but is more strongly affected by past management actions.

2 — Past Dealings

Anyone who desires to make rapid organizational changes quickly discovers the weighting that individuals give to their past treatment. This is seen in one business owner’s perception after five years with his firm. A charismatic and ethical leader who cares deeply for the people who work with him, his outstanding behavior was immediately noticed by employees who welcomed his arrival after years of unethical and authoritarian management. He observed, however, that although he had behaved the same way from his first day on the job, employees didn’t start to believe and trust him until four years had past. They saw his good deeds and recognized his fairness, but they also remembered their poor treatment by previous management. They supposed that he, like the rest, would sooner or later reveal his true spots and treat them the same way. Only after several years of consistent behavior passed before their eyes were they finally able to trust him and wholeheartedly participate in the success of the company.

While not all employees are so jaded, many employees are cynical and wary of new efforts with familiar promises.

People’s reaction to leadership is then a moving average, giving some weight to existing management behavior while they strongly rely on their previous experience. This gradual building of respect and trust is critically important. Management should act at a speed that corresponds to the seriousness and urgency of the situation. Individuals must clearly be helped to understand the reasons behind swift changes or else management puts their relationship with employees into jeopardy. Changes made too rapidly can be perceived as coercion instead of common sense.

While many understand the impact of current and past leadership upon culture, fewer realize that the greatest contributor to the way we do things here is the effect of Organizational Structures that have been put in place over time.

3 — Organizational Structures

The values, goals and perceptions of those in management continue to influence employees even after individual managers may have moved on. How? The policies, performance measures, work practices, and assumptions about employee behavior currently in operation within your business are the cumulative result of all previous management’s values, goals and perceptions about how an organization should be managed. Each senior manager’s legacy becomes part of the intangible way we do things here and shapes employee activities.

A number of years ago, the city of Sunnyvale, CA was voted the best place to start a business in the US. David Vossbrink, Community Relations Manager, described their 10 year ‘customer’ process that continued to improve resident services while reducing the city’s operating costs. Sunnyvale’s program carefully selected performance measures, evaluated specific employee activities, and used both negative and positive incentives to encourage behavior. I asked if the city had a senior administrator champion during their 10 year evolution. His reply revealed the power of Organizational Structures upon employee behavior. He said, “Yes. What is more important, however, is that if the champion were replaced today by someone with the opposite point of view, it would take that person 10 years to undo the customer perspective that we have built into every performance measure, every policy, every thing we do.”

The impact of Organizational Structures is difficult to see. Once familiar, managers fail to explore and challenge the perspectives underlying existing policies and procedures and just accept their validity. The preceding viewpoint may have been contrary to management’s current vision for the company, or business situation changes have rendered the previous perspective no longer valid. A periodic, externally facilitated evaluation is often necessary due to familiarity and the powerful effect of these structures upon employee behavior.


Culture is a combination of Current Leadership, Past Dealings, and Organizational Structures.

  • Current Leadership is very important but as employees consider current leadership, they give stronger weight to their experience with previous management teams.
  • Past Dealings explains why rapidly shaping activities and attitudes is difficult for those without specific experience.
  • Organizational Structures are capable of withstanding significant pressure – negating the impact of speeches, banners, programs, and measures. In one organization, they repelled a three-year improvement effort leaving quality unchanged, and frustrating education programs designed to encourage individual leadership. Structures, because of their stealth, can make integrating newly acquired companies a significant challenge.

Over time, current leadership can overshadow the effect of previous management and make substantial changes if they recognize that employee behavior arises primarily from the structures that are in place. Managers, by ignoring remaining structures, can expend significant effort without any perceptible return. By changing the structures, however, senior managers can drive appropriate behavior and keep an organization aligned with a rapidly changing business climate – SMG’s unique approach drives full advantage from this principle.

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  1. Pingback: Can You Engineer Work Culture? – SMG Knowledge

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