Week 2. Organizational Culture

Organizational Culture Definition

(Explanation)
You can have all the right strategies in the world; if you don't have the right
culture, you're dead - Patrick Whitesell

If you are a basketball fan, you must have read about the Chicago Bulls'
struggles before Michael Jordan's arrival. The franchise could not win a single
title in the history of the NBA. With Michael Jordan's arrival, it won multiple
consecutive NBA titles. One of the biggest reasons for its success was the
culture Jordan helped to establish at the franchise. This goes to show how
much impact culture can have on the success of an organization. In this
explanation, we discuss organizational culture definition and its impact on the
fate of an organization
Page 99 – business voc.

Organizational Culture Definition Business
Human species have had culture from the start of civilization. It drives our
social behaviors and helps us differentiate between good and bad. It also acts
as a tool to distinguish us from others. There are many cultures in the world.
These cultures help in forming distinct societies. For instance, using the left
hand while eating is considered bad in some cultures; in others, there could
be something else regarded as taboo. Undoubtedly, culture provides a set
of values or patterns through which people conduct themselves.
When we talk about business organizations, it is crucial to address the

organizational culture definition and the ways to establish a strong culture
within an organization. The question is, what does it mean?
Organizational culture is the values and beliefs that the members of an

organization share. It guides them in their actions and decisions and
distinguishes them from others.
Organizational culture creates a distinct identity for an organization. It

provides a framework for the actions and decisions of the employees. An
organization with healthy culture tends to perform better than others. The
reason is simple, it provides clarity to the employees in terms of expectations
and ensures their actions conform to the organizational culture.
Netflix is one of the leading digital streaming platforms. It has a solid and
healthy organizational culture. It focuses on people over process, i.e., support
the employees, and the process will take care of itself. Netflix strongly
believes in giving freedom to employees to innovate and create.
Fig. 1 - Netflix believes in people over process
Organizational Culture Definition and

Characteristics
Organizational culture is a shared value and belief system that employees

follow in an organization. There are six main characteristics of organizational
culture that help define it.
1. Adaptability – It encourages innovation and flexibility within the

organization. Employees should have leeway to bring new ideas to the table
and work on projects that could contribute to the organization's success. The
employees should be given the chance to experiment and add value to the
organization.
2. People – It is about factoring in the effect of management's decisions on

the employees and the customers. This is a vital characteristic to consider
while developing the organizational culture. Employees and customers
contribute directly to the success of an organization, and protecting their
interests must be a priority.
3. Detail – It is about focusing on attention to detail in the organization. The

organization must develop a culture in which employees take attention to
detail seriously. It helps employees develop key skills such as analytical
thinking and active listening.
4. Results – This characteristic concerns the management's focus on the

results rather than the process. It is a culture where employees can use any
method or technique they want as long as they complete the projects and
tasks within the expected timeline.
5. Collaboration – It talks about the priority of management to create a

collaborative work environment. An organization performs better when its
teams can work well together. Employees should put the interests of the
organization before their social interests.
6. Integrity – Concerns instilling ethical practices in the work environment.

Every organization wants to perform optimally and achieve more, but it
should not jeopardize its integrity.
Organizational Culture Definition

Importance and Development
Organizational culture directly impacts all aspects of an organization. From
employee performance to achieving the set objectives, it contributes to
almost all aspects of an organization. An organization with healthy work
culture could increase employee engagement. When there is clarity in
terms of expectations and purpose, it means employees know their roles. This
could motivate them to match those expectations resulting
in increased productivity.
A healthy organizational culture fosters employee loyalty toward the

organization. They understand that the organization appreciates their efforts
and will support them whenever required. It means the employees feel valued
and less likely to leave the organization.
Organizational culture could also promote harmony among team

members. It is important to have teams working collaboratively on projects.
It ensures that employees complete tasks on time and that no
petty organizational politics are involved.
Now that we have discussed the importance of organizational culture let's

shift our focus to how we can develop a culture within an organization.
In an organization, the top management is tasked with developing the

culture. They identify the elements essential to the organization and
incorporate them into the culture. However, an organization cannot create a
culture in one day. It requires time and persistent efforts by management. To
develop the culture, the founders/top managers set the tone, and then the
behavioral norms that are consistent with the organizational culture develop
over time. It is essential to recognize the importance of communication in the
organization. It helps management improve the culture and sustain it in the
workplace.
Parts of Organizational Culture
Developing an organizational culture requires time and planning. The

management needs to identify the parts of organizational culture that are
essential to them. These parts help them develop the culture and provide
clarity to the employees in terms of expectations.
Leadership – Creating a healthy organizational culture starts with

leadership. Leaders are the ones who set the tone for others to follow. It is the
responsibility of leadership to identify the aspects of organizational culture
that need to be improved. When there is good communication and respect
between employees and the leadership, the organization prospers.
Community – Creating a community is an integral part of organizational

culture. Employees must have a sense of belonging in the organization. They
feel valued and take ownership of their actions when they feel part of a
community.
Employee empowerment – It creates an environment where employees
exercise their freedom to innovate. It gives them a feeling that the
organization trusts their abilities and they can contribute to the success.
Empowered employees take ownership of their decisions.
Values – Management needs to communicate the organizational values to

the employees transparently. Employees must understand and identify with
the values of the organization. It can help them live these values on a day-to-
day basis.
Communication – Effective communication is key to developing a strong

culture in an organization. It helps the leadership communicate the
expectations of the employees. It also helps employees connect with
leadership and suggest ways to improve the culture.
Fig. 3 - Employee empowerment is a key aspect of organizational culture
Types of Organizational Culture
There are four main types of organizational culture. The management weighs
the pros and cons of each before selecting them. The selection depends on
the organization's objectives and the kind of culture it wants to develop.
Clan culture – The basis of this type of culture is human affiliation. It is a

culture where employees work collaboratively to achieve objectives. The
focus is on establishing a culture where clear communication and teamwork
are a priority. Employees tend to feel more valued and satisfied in such an
environment. This culture is often seen in startups where employees can
freely express themselves.
Adhocracy culture – The basis of this type of culture is innovation. The idea
is to develop a culture where employees are encouraged to take risks,
experiment, and innovate. The management instills traits such as attention to
detail and autonomy in the employees. In an adhocracy culture, the objective
is to innovate to achieve high-profit margins.
Market culture – The basis of this type of culture is an achievement.

Employees are expected to shine in their respective roles to help the
organization grow. The organization focuses on maximizing profits and
evaluating employees on their productivity. In such a culture, the
management focuses on results rather than processes.
Hierarchy culture – The basis of hierarchy culture is stability. The

management focuses on developing a structure where each employee knows
their role. In this type of culture, there is top, middle, and bottom-tier
management. The communication flow is vertical, and employees are
expected to follow the rules.
Ethical & Adaptive Organizational Culture
In ethical organizational culture, the management and employees are

expected to uphold honesty and integrity in the workplace. It focuses on how
things are done and the purpose of business decisions. Management
considers the impact of business decisions and practices on employees,
customers, and the external environment. Top management needs to lead by
example because it will urge employees to follow suit.
In adaptive organizational culture, employees are allowed to innovate and

experiment. It allows them to bring new ideas/approaches to the table. It
enables the workforce to adapt according to different circumstances. In such
a culture, the employees can deal with internal and external pressures
effectively.
Organizational Culture Definition - Key

takeaways
 Organizational culture provides clarity to the employees regarding
expectations and ensures their actions conform to the organizational
culture.
 Organizational culture is a shared value and belief system that
employees follow in an organization.
 An organization with healthy work culture could increase employee
engagement.
 A healthy organizational culture fosters employee loyalty toward
the organization.
 In ethical organizational culture, the management and employees
are expected to uphold honesty and integrity in the workplace.
 In adaptive organizational culture, the employees are given the
opportunity to innovate and experiment.
CASE STUDY
Group 2. Corporate culture
Content (4pts) Delivery (3 pts) Visual aids (1.5 Teamwork (1.5

pts) pts)
-Y Quynh: 1.8
-Ngọc Hân: (2)
+Importance of
corporate culture
Employee
engagement
Job satisfaction
and motivation
Reduce stress and

prevent burnout
Enhance
performance and
productivities
-affect to
customers:
+experience
+brand identity
+strengthen
partnerships
Brand loyalty
-Long-term success
-How can the

corporate culture
affect the
customers’ loyalty?
_Bích Nương (1.9)
How to assess the

culture:
-HR
Tools:
-Clan culture
Survey
Focus group
Performance
metric
_Vân Anh: (2
Ethics in cultures
“Soul”
-Social
responsibilities
Như QUỳnh:: 2.5
Case study:
-Honest-loyal-
đeicated-
intelligent-friendly
-Can you make the

explanation for the
four cultures?
Strong brand
reputation and
word of mouth
marketing
Thảo AN: 2.8
-Ethical business
practice
-ethical decision
mking
Transparency in
operation

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Organizational Culture Definition

Organizational Culture Definition Business

When we talk about business organizations, it is crucial to address the

Organizational culture is the values and beliefs that the members of an

Organizational culture creates a distinct identity for an organization. It

Organizational Culture Definition and

Organizational culture is a shared value and belief system that employees

1. Adaptability – It encourages innovation and flexibility within the

2. People – It is about factoring in the effect of management's decisions on

3. Detail – It is about focusing on attention to detail in the organization. The

4. Results – This characteristic concerns the management's focus on the

5. Collaboration – It talks about the priority of management to create a

6. Integrity – Concerns instilling ethical practices in the work environment.

Organizational Culture Definition

A healthy organizational culture fosters employee loyalty toward the

Organizational culture could also promote harmony among team

Now that we have discussed the importance of organizational culture let's

In an organization, the top management is tasked with developing the

Parts of Organizational Culture

Developing an organizational culture requires time and planning. The

Leadership – Creating a healthy organizational culture starts with

Community – Creating a community is an integral part of organizational

Values – Management needs to communicate the organizational values to

Communication – Effective communication is key to developing a strong

Fig. 3 - Employee empowerment is a key aspect of organizational culture

Types of Organizational Culture

Clan culture – The basis of this type of culture is human affiliation. It is a

Market culture – The basis of this type of culture is an achievement.

Hierarchy culture – The basis of hierarchy culture is stability. The

In ethical organizational culture, the management and employees are

In adaptive organizational culture, employees are allowed to innovate and

Organizational Culture Definition - Key

Content (4pts) Delivery (3 pts) Visual aids (1.5 Teamwork (1.5

-Ngọc Hân: (2)

Reduce stress and

-How can the

_Bích Nương (1.9)

How to assess the

Như QUỳnh:: 2.5

-Can you make the

Thảo AN: 2.8

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