What are the four types of organizational culture?
What distinguishes your business from others If you’re thinking, “Definitely our organizational corporate culture! But what does that mean? Despite its recent surge in popularity, the idea of organizational corporate culture is still mostly ill-defined and amorphous. Consider your company’s culture to be its personality. It reflects the common values and actions that guide how your team members communicate and make choices. An organizational corporate culture is very significant. A survey by Deloitte revealed that 94 per cent of top managers and 88 per cent of workers think a unique organizational corporate culture is crucial for business success. The Society for Human Resource Management (SHRM) also points out that the culture a company fosters is more important than where the workplace is located. They also note that remote work has presented several challenges in keeping the organizational corporate culture strong. To create a supportive environment for your team and achieve your business objectives, you need to know your starting point. Identifying your current organizational corporate culture can be challenging. To assist you in understanding where you are and where you want to go, let’s examine four organizational corporate culture categories.
Recognizing your position: The four categories of organizational culture
Before you evaluate the positive, negative, and problematic aspects of organizational corporate cultures, consider the research by business professors Robert E. Quinn and Kim Cameron. Almost 40 years ago, they conducted significant research on organizational corporate culture and found that no culture is purely “good” or “bad”, but rather unique. They identified four types of organizational corporate culture. The outcome is that nearly 90 per cent of companies worldwide fall into one or more of these culture categories. While each category is unique, none is better than the others by nature. Each has its advantages and disadvantages. Moreover, a company might combine elements of these different culture types. The culture within a company can change based on the particular team or project. It’s all about understanding where your organizational corporate culture aligns.
Type 1: Clan culture
Have you noticed people calling their colleagues their family? This suggests they’re in a clan culture (also known as a “collaborative culture”), which prioritizes teamwork and unity.
Clan cultures create a supportive work environment where factors like relationships, morale, involvement, and agreement are central. When it comes to leading a team, managers are seen more as guides who help and support their team members, rather than just bosses who give orders and scold.
Advantages of this kind of team environment:
- A team that is truly happy and enjoys working with each other.
- Better communication among team members.
Disadvantages of this kind of team environment:
- Too much teamwork or idle talk, which can greatly reduce productivity.
- Difficulty in making hard decisions because the feelings of others are given a lot of importance.
Example of this kind of organizational corporate culture:
Online store Zappos, which sells shoes and clothes, is often complimented for its positive work atmosphere. The company’s CEO even wrote a book about their culture of happiness. With “create a positive team and family spirit” as one of their main principles, they perfectly represent the clan culture style.
Type 2: Adhocracy Culture
This organizational corporate culture is based on the idea of doing things on the spot, similar to the saying “move quickly and be willing to make mistakes,” which is common in many new businesses. It’s sometimes called the “creative culture.” Quinn and Cameron describe this organizational corporate culture as promoting a very entrepreneurial work atmosphere, where workers are encouraged to take chances and pursue unusual ideas. This leads to a lot of new ideas, learning, and development, both for the employees and the company overall.
Advantages of this culture:
– A lot of innovation and growth.
– Greater psychological safety, meaning employees feel comfortable trying out new ideas.
Disadvantages of this culture:
– It might seem unstable because the company puts a lot of effort into new projects.
– Newcomers may feel overwhelmed if they lack the skills to work fast and aggressively.
Example of this organizational corporate culture type:
Being complacent did not help Google become one of the most well-known tech corporations in the world. The company focuses on innovation to enhance search and introduce new products, which describes their culture as an adhocracy culture. Facebook is another example of an adhocracy culture, albeit its “move fast and break things” mentality has recently had to adjust in response to increased customer awareness.
Type 3: Market culture
A market culture, also known as a “compete culture,” focuses on achieving results. To put it plainly, people want to succeed and realize their objectives. Employees are very focused on reaching their goals, and managers are strict and expect a lot to meet the company’s success targets. This can create a stressful workplace, but it also feels good when the hard work leads to clear, positive outcomes.
Advantages of this work style:
- Workers are very determined and eager to reach their objectives.
- The company performs better because everyone is dedicated to achieving success.
Disadvantages of this work style:
- Always promoting competition can make the workplace unhealthy.
- Staff might feel too much stress and could even become exhausted due to the ongoing pressure.
Example of this organizational corporate culture:
Amazon has frequently been in the news for its intense organizational corporate culture. Employees have openly discussed how they are expected to produce results and advance in their careers, regardless of the personal toll it takes. Amazon might deny these accusations, but it’s clear that the company strongly focuses on achieving success, which aligns with the typical market-driven organizational corporate culture. One of Amazon’s guiding principles for leaders is to “achieve results.” The company describes this as leaders concentrating on the essential aspects of their business and ensuring these are done correctly and on time. They are expected to overcome obstacles and always strive for improvement.
Type 4: Hierarchy culture
Establishments that have a hierarchy culture also referred to as a “control culture,” are extremely structured and follow rigid protocols. Here, activities and decisions are mostly guided by existing rules rather than by creative thinking and innovation. Leaders in this type of organizational corporate culture aim to keep their teams operating smoothly, with a strong emphasis on maintaining stability, achieving results, and ensuring consistent performance.
Advantages of this culture type:
- Communication and expectations are very clear since almost everything is set in advance.
- Workers feel more secure and know what to expect.
Disadvantages of this culture type:
- Focusing on rules instead of people can make the workplace seem rigid and not very supportive.
- Too much strictness can hinder creativity and progress because people are scared to try new ideas.
Example of this organizational corporate culture type:
Many government agencies follow a hierarchical culture. They deal with many rules and often face a lot of checks, so they focus on following policies and procedures strictly. They must follow the rules exactly, and there are clear paths for employees to move up in the organization. There’s no uncertainty about what needs to be done.
Additional categories of organizational corporate culture
Besides the four primary types of organizational corporate culture, there are a few others that are also important to mention.
Mission-Driven Culture
A mission-driven culture emphasizes a company’s purpose and fundamental values. These elements are what shape the organizational corporate culture. Many companies with this type of organizational corporate culture aim to improve an industry or community.
Mentorship Culture
In a mentorship culture, top management is in charge of guiding their employees and making sure they progress in their jobs. This culture is usually supported by various mentoring methods, such as evaluations of particular projects or private meetings where work expectations and personal objectives are reviewed.
Responsibility Culture
A responsibility culture means that everyone in the company, from the top boss to the leaders, must take charge and be answerable for what they do and how well they do it. This includes workers owning up to their errors, discussing how they can improve from them, and praising coworkers when they do a great job.
Learning-focused culture
Companies that focus on learning prioritize opportunities for growth and development. They often hold workshops for everyone and support employees in acquiring skills beyond their job requirements, offering funds for different educational programs.
How to identify your organizational corporate culture?
Cameron and Quinn created a tool that helps businesses figure out their organizational corporate culture. After you understand your current culture, think about what is important to your company: What areas are you doing well in? What areas need improvement? If you believe a different organizational corporate culture would be better for your company and its employees, start making changes. This process varies from company to company, but generally, you should begin by understanding your current organizational corporate culture, financial goals, company structure, mission, and core values. Then, keep checking how your organizational corporate culture is doing and the progress you’re making toward your goals.
To get more detailed advice and help with understanding and improving your company’s culture, check out the resources and articles on the UNLEASH website.