Corporate culture

Corporate culture is defined as social standards and system of values, which stimulate employees, favourable climate in organisation, proper ways of managing, shared meanings and symbols, requirements of people's behaviour. Corporate culture is based on unwritten rules, which are located between statute and real situations.

Levels of corporate culture

E. Schein distinguished three levels of corporate culture:

• visible and conscious - artefacts, cultural creations, noticeable patterns of behaviour,
• partly visible and conscious - norms and values, bans, ideologies,
• invisible and usually unconscious - relation to the environment, human nature, relationships.

Basic features of corporate culture

• actions of people is subconscious and automatic,
• multilevel and multidimensional,
• feedback between corporate culture and it's determinants.

Factors influencing corporate culture

Corporate culture isn't constant. It depends on many external and internal factors, which impact on the company. The most important are:

• type of environment,
• type of organisation,
• characteristics of the organization,
• characteristics of participants.

Corporate culture has great impact on managing. In may be useful in stimulating behaviour which promote the objectives of the company. Corporate culture affects the shape of the company and behaviour of the staff, affects also the value of the company. That's why it has to be taken into account in the analysis of value of the company.

Types of corporate culture

There are four types of corporate culture:

• The culture of power - it's based on the individual leader (or a group of leaders), who has an impact on whole organization. Decisions are made according to the priorities of the leader. The entire control and information are located in the center. This kind works in turbulent environment, when they need to respond quickly, generally in small companies. Quality of taken actions depands on qualifications of leaders. The loss of the leader is critical situation, that may even lead to the collapse of the company.
• The culture of role - it's strength is high degree of specialization. Usually there is high bureaucracy in such company. Cooperation between organizational units is based on the following procedures and ranges. Efficiency depends on reasonable goal setting and division of founds and resources for organizational units. The role is more important, than who performs it. This kind works in stable environment, where goals don't change often and specialized cells can be created. Tribulations of the environment are critical situations. It can lead to the collapse of the company, if the Board will not work well enough.
• The culture of targets / The culture of task - in which the main emphasis is laid on completing the task (job, project, program). Authority stems from knowledge and experience. It's focused on teamwork. The main advantage of this corporate culture is flexibility and ability to adapt to changing environment.
• The culture of units - in which unit is the centre of organization, the role of the company is to organize the workplace. This culture is designed to meet the needs of the employee. They are usually a group of lawyers, accountants, architects - skliied professions.

See also:

• Organizational culture
• Uncertainty avoidance
• Power distance
• Individualism
• Determinants of culture

Corporate culture — recommended articles

Principles and features of organizational structure — Characteristics of bureaucracy — Bureaucratic organization — Bureaucratization — Hierarchical dependence — Organic organization — Adhocracy — Bureaucratic leadership — Leadership models

References

• Hofstede, G., Hofstede, G. J., & Minkov, M. (1991). Cultures and organizations: Software of the mind (Vol. 2). London: McGraw-Hill.
• Hofstede, G. H., & Hofstede, G. (2001). Culture's consequences: Comparing values, behaviors, institutions and organizations across nations. Sage.
• Hofstede, G., Neuijen, B., Ohayv, D. D., & Sanders, G. (1990). Measuring organizational cultures: A qualitative and quantitative study across twenty cases. Administrative science quarterly, 286-316.
• Hofstede, G. (1993). Cultural constraints in management theories. The Academy of Management Executive, 7(1), 81-94.
• Schein, E. H. (1988). Organizational culture.
• Schein, E. H. (1996). Culture: The missing concept in organization studies. Administrative science quarterly, 229-240.
• Schein, E. H. (1999). The corporate culture survival guide.
• Schein, E. H. (2006). Organizational culture and leadership (Vol. 356). John Wiley & Sons.
• The Hofstede Centre website