What is corporate culture?

What is corporate culture?

By Rahayu Ratnaningsih

This is the first of two articles on corporate culture.

JAKARTA (JP): Few terms have been so frequently defined, yet
so widely misunderstood, as corporate culture. According to
Jerome Want in his book Managing Radical Change, corporate
culture consists of the collective beliefs that people within the
organization have about their ability to compete in the
marketplace -- and how they act on those belief systems.

A company's culture is revealed through the attitudes, dreams,
values, and behavior of employees and management. For that
reason, corporate culture is not easily manipulated or quickly
redirected by memos or mission statements, but, over time, it can
be developed and guided in the directions required to ensure a
company's success.

This begs a string of questions: is corporate culture created?
Who can create corporate culture? How to develop corporate
culture? And what are the important elements in the development
or change of corporate culture? What kind of corporate culture
does a successful company have that sets it apart from other less
successful companies?

The crucial starting point in answering these questions should
be in the ability of each company to identify its own corporate
culture. Often we hear employees retort that their company does
not have a culture. Or many cannot even explain what the culture
of their company is. The fact is every company has a culture; the
difference is whether it is great, mediocre or lousy.

One thing is clear when an excellent corporate culture, i.e. a
performance-driven one, exists, everybody who comes into contact
with that organization can instantly see and feel it. There is a
strong "palpable but invisible" force there somewhere that
motivates and drives employees to be the best in whatever they
are doing. Ideally in a performance-driven corporate culture,
office politics can hardly take place.

Jerome Want has divided corporate cultures into a hierarchy
consisting of seven major categories: predatory (punitive/
alienating), frozen (gridlock/denial), chaotic (fragmented/
unfocused), political (retaliatory/balkanized), bureaucratic
(procedural/rigid/regimented/authoritarian), service (customer
focus/individualizing/quality), and new age
(innovative/egalitarian/consensual/changing).

Back to the question, is or can corporate culture be created
and who can create it? Is corporate culture equivalent to the
corporate mission statement that is pasted all over the office
walls? A mission statement can easily be created, but to make it
manifest in a strong culture that is deeply embedded in every
employee's mind and heart is a completely different issue.

Any human resources practitioner cannot deny the "intimate
relationship" between corporate culture and leadership.
Employees who cannot perceive or define their corporate culture
usually have a problem in one way or another with their corporate
leadership. Leadership is doing the right things, as opposed to
doing things right which is the definition of management.

Strong and effective leadership paves the pathway toward a
performance-driven corporate culture. It represents fertile land
for the growth of excellence. The downfall of this premise is
leadership is not that easy to redirect or change. A change in
leadership is basically a total change in the body and soul of a
company. It is equivalent to a reform movement or even revolution
in a country.

A change in leadership more often than not means a replacement
of the old leader of a company with a new one. It is, obviously,
easier for a leader to reshape his subordinate than for a
subordinate to reshape a leader.

Other crucial elements, after leadership, in culture
development are the system and structure of the organization.
Leadership translates corporate vision through a supportive
system and structure. Hence, correct leadership should be
manifested in effective systems and structures. If we imagine
this concept as a chart, we may visualize a pyramid with
leadership on the peak while system and structure are the two
legs.

Needless to say, corporate culture is a top-down process for
most companies. The tail will only be willing to head for some
place, if the head is facing in that direction and making a
decision to move accordingly. A failed corporate culture very
often becomes the source of employees' dissatisfaction and
subsequently their departure.

In other words, corporate culture is very much created by
effective, principle-centered leadership. The word "principles"
is used here instead of "values"; principles are lighthouses;
they are a point of reference and they don't budge or waver, but
give a sense of direction to others who may choose to adjust
their position using them as a compass. While values are
relative and subject to frequent and immediate change, correct
principles do not change.

The writer is a human resources and personal development
consultant based in Jakarta.