Organisational Culture, Its Types and Success Factors

Introduction

An organisation’s culture plays an integral role in influencing its success. Particularly, the corporate culture entails the values and behaviours that account for the uniqueness of the organisation’s psychological and social environment. The culture is founded on an array of shared features, including the rules, beliefs, customs, and attitudes (Alvesson 2012). The construction of the business culture occurs over time to reinforce its validity in streamlining the social and psychological aspects of interactions. As such, an organisation may adopt one of the various types of organisational cultures to shape up the values and behaviours that promote the attainment of shared goals and objectives (Singh et al. 2017). Nonetheless, several critical factors influence the importance of the adopted organisational culture. Therefore, it is crucial for an organisation to consider the factors that would make the adopted organisational culture realise its importance in the workplace environment. Therefore, this paper analyses the different types of organisational cultures before identifying the critical factors that influence the success of an organisational culture. Finally, the paper will discuss the importance of a corporate culture in an organisation.

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Main Types of Organisational Cultures

Each organisation adopts a culture that is unique since it needs to align it (culture) with the vision developed by the leaders, as well as the different experiences of the employees in an organisation (Singh et al. 2017). For this reason, Ahmady, Nikooravesh, and Mehrpour (2016) assert that an organisation may adopt a type of corporate culture that is compatible with its vision, as well as the unique attributes of the stakeholders. In this respect, the Competing Values Framework led to the establishment of four types of organisational cultures that include clan culture, adhocracy culture, market culture, and hierarchy culture.

The Clan Culture

The clan organisational culture takes a family-like approach that underlines the essence of friendliness and collaboration (Kim 2014). The clan culture works best in an environment where individuals possess similar attributes. As such, leaders in organisations that adopt the clan culture play the role of a team builder, facilitator, and mentor (Kim 2014). Such leaders need to nurture the members of the organisation through collaborative involvement. The clan type of business culture is advantageous since it binds together the members through loyalty and traditions upheld by the organisation. The bonds created by the set moral standards in the organisation foster the commitment of the members, thereby developing the human resource in the workplace environment. Importantly, the ability to care for the employees while addressing the needs of the client determines the success of the clan organisational culture (Chuang, Morgan & Robson 2012). The approach supports participation, teamwork, open communication, and consensus (Barbars 2016).

The Adhocracy Culture

The adhocracy culture works best in environments characterised by entrepreneurial and dynamic individuals. Particularly, the adhocracy culture encourages members to take risks and/or approach new endeavours with creativity and innovation, thereby creating bonds in the organisation (Ergün &Tasgıt 2013). Further, the adhocracy culture underlines the essence of prominence in the organisation. In this light, leaders persuade their followers to take risks and introduce new products and services that can make the organisation a prominent one, thereby denoting its success (Ergün &Tasgıt 2013). For this reason, an organisation embracing the adhocracy culture encourages the members of an organisation to be free and initiative. As such, this type of corporate culture identifies agility and change as its core values (Iivari & Iivari 2011).

The Market Culture

The need for an organisation to stay competitive and/or realise impressive results led to the development of the market organisational culture. Leaders in such culture influence their followers to be competitive and goal-oriented (Reitzig & Maciejovsky 2015). Therefore, the shared goal of the organisation creates an important bond among members who put their efforts towards beating their rivals. In this light, ‘getting the job done’ is the main drive of the market culture adopted by a given organisation.

The Hierarchy Culture

Structure and control characterise the hierarchy organisational culture (Reitzig & Maciejovsky 2015). The culture is usually integrated into a formal workplace environment that follows strict rules and institutional procedures (Büschgens, Bausch & Balkin 2013). Leaders underscore the significance of predictability and efficiency to bolster organisational success. The process of coordinating and monitoring of leaders is facilitated by the integration of core values, including consistency and uniformity. Efficient delivery, streamlined planning, and low-cost operations denote the success of a hierarchy culture (Bareli 2017).

The Critical Success Factors of the Organisational Cultures

The different types of business cultures require the influence of certain factors to realise the envisioned success. As such, discussing the various factors that influence the success of an adopted corporate culture is consistent with the aim of this paper.

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Success Factors for the Clan Culture

The ability to cater for the needs of the entire members in an organisation is what defines the success of a clan culture. The critical success factors of the clan business culture include commitment, communication, and development (Barbars 2016). Commitment influences the success of the clan culture by encouraging members to work as a team towards securing the shared goals. In this case, the synergy created by all members reinforces the collaborative approach embraced by a particular organisation. Members’ commitment also denotes their contribution towards creating an enthusiastic approach to improving their well-being. Furthermore, communication is an integral aspect of the clan culture. In this case, the members of an organisation need to communicate openly and efficiently (Barbars 2016). Efficient communication allows parties to address issues that require solutions to realise the shared interests. As such, poor communication undermines the involvement of the entire family, thereby undermining its success (Alvesson & Sveningsson 2015).

The essence of developing the human resource in an organisation is connected directly to its success. As such, the clan culture requires leaders to develop their employees constantly (Nguyen & Mohamed 2011). The regular development of workers demonstrates an organisation’s interest in improving their well-being, thus encouraging their commitment to realising organisational goals and objectives.

Success Factors for the Adhocracy Culture

Factors that account for the success of the adhocracy culture include creativity and innovation, agility, and transformation. The need for creativity and innovation is crucial to the success of an organisation that embraces the adhocracy culture since it encourages the staff to take calculated risks. Therefore, engagement in creative and innovative undertakings is vital in facilitating the success of the adhocracy culture.

The agility or swiftness of the members of an organisation that adopts an adhocracy culture is a crucial contributor to its success. Importantly, members need to be timely in developing creative and innovative responses to the changes in the industry. For this reason, the agility factor needs to be reinforced by a visionary leader (Nguyen & Mohamed 2011). The agility is also a major contributor of the transformation supported by creativity and innovation.

Success Factors for the Market Culture

Success factors in the market culture include customer preferences, the efficiency of external partnerships, the level of competition, and the involvement of customers and suppliers (Büschgens, Bausch & Balkin 2013). The chinning preferences of customers require the consideration of the leaders of an organisation. In this concern, it is important to meet the dynamic needs and expectations of clients to gain a considerable market share. External partnerships also contribute to the success of the market organisational structure (Prajogo & McDermott 2011). Partnerships with crucial players in the industry, including suppliers, are central when it comes to improving their relationships and/or aligning resources towards the envisioned goals. Therefore, reinforcing the internal need to realise the goals is also influenced by the degree to which the company collaborates with key industry stakeholders. Competitiveness also determines the success of an organisation that adopts the market culture (Büschgens, Bausch & Balkin 2013). In this respect, all members of the organisation should direct their efforts towards fostering the competitiveness of the organisation. For instance, the development of successful expansion strategies may be integral in bolstering the competitive edge of the company. Undoubtedly, successful companies usually have a considerable market leadership.

Moreover, the ability of leaders to foster the involvement of customers and suppliers is essential for facilitating the success of the organisation (Alvesson 2012). As such, it is important for leaders who support the market culture to encourage employees to create a meaningful relationship with customers. Essentially, effective customer affairs are necessary for improving the brand image of a company. Further, effective relationships with suppliers streamline the supply chains and logistics aspects of operations.

Success Factors for the Hierarchy Culture

The critical influences for the success of the hierarchy culture include efficiency, uniformity, consistency, and timeliness. Efficiency ensures that the organisation escapes from making errors that would undermine the satisfaction of stakeholders. In this respect, strict rules and institutional procedures that characterise the formal organisational structure require keen observation to guarantee its success (Büschgens, Bausch & Balkin 2013).

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Uniformity is also a factor that needs a full implementation to realise the success of the hierarchy culture (Prajogo & McDermott 2011). In this respect, members of the organisation need to uphold shared values and behaviours necessary for fostering the success of the organisation. The need for uniformity also calls for consistency in the entire departments of the hierarchical organisation.

Undoubtedly, the absence of timely delivery of services or products to consumers undermines the success of the hierarchy corporate culture (Bareli 2017). Thus, the essence of timeliness holds relevance to a considerable extent in a hierarchy business environment. Notably, the factor that has led to the criticism of the hierarchical organisation is that the bureaucracy involved undermines timeliness. In this concern, the culture needs to observe the timely delivery of offerings to consumers to bolster the organisational success.

Importance of an Organisational Culture

The corporate culture adopted by an organisation offers various benefits to its employees. Notably, the culture shapes interactions among employees in the workplace (Alvesson 2012). Healthy interactions allow the members of the organisation to gain motivation and hence loyalty to the employer. Importantly, the relationships created by the organisational culture are crucial in facilitating job satisfaction.

Corporate culture is also important since it sets rules and institutional policies for observation by all members of the organisation. The guidelines ensure that employees perform their roles and responsibilities accordingly. Further, the code of conduct underlined by the organisation culture ensures that the entire workforce engages in morally upright actions.

Business culture also facilitates the reinforcement of an organisation’s brand image (Bareli 2017). Notably, the organisational culture adopted by a competitor in an industry makes it distinct from its rivals. For this reason, the culture embraced accounts for the creation of a unique brand that is essential in improving the competitive edge of the organisation.

Additionally, the organisational culture binds together all the members of an organisation by creating a common platform (Singh et al. 2017). As such, the culture provides an environment where every member is treated equally. Since employees from diverse backgrounds characterise the contemporary business setting, it is important to ensure that all workers receive equal treatment. By so doing, the culture streamlines the relationships in the organisation, thereby promoting a collaborative approach to goal attainment.

Moreover, the business culture facilitates the need to bring out the best out of every member of the team (Prajogo & McDermott 2011). The culture contributes to the development of the individual employee, thereby enhancing his or her productivity. As such, no one is forced to work since everyone is committed to offering his or her efforts towards meeting the shared goals and objectives.

Conclusion

An organisational culture plays an important role in shaping the values and behaviours adopted by members in an organisation. The major types of corporate cultures include the clan, adhocracy, market, and the hierarchy ways of life. The common success factors regarding the different types of organisational culture include commitment, communication, development, involvement, innovation, and competitiveness. Moreover, the adoption of a suitable business culture is important for fostering the approach to interactions, the building of meaningful relationships, bolstering productivity, and embracing diversity among other benefits.

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Reference List

Ahmady, G, Nikooravesh, A & Mehrpour, M 2016, ‘Effect of organisational culture on knowledge management based on Denison model’, Procedia – Social and Behavioural Sciences, vol. 230, no. 1, pp. 387-395.

Alvesson, M & Sveningsson, S 2015, Changing organisational culture: cultural change work in progress, Routledge, Abingdon.

Alvesson, M 2012, Understanding organisational culture, Sage, Thousand Oaks.

Barbars, A 2016, ‘Engagement in the information and communication technology sector in Latvia’, Journal of Business Management, vol. 1, no. 12, pp. 84-100.

Bareli, A 2017, ‘Hierarchy, representation, and inclusion in a reflective democratic culture: conflicting perspectives in Israel’s nascent years’, Israel Studies, vol. 22, no. 1, pp. 139-140.

Büschgens, T, Bausch, A & Balkin, D 2013, ‘Organisational culture and innovation: a meta‐analytic review’, Journal of Product Innovation Management, vol. 30, no. 4, pp.763-781.

Chuang, F, Morgan, R & Robson, M 2012, ‘Clan culture, strategic orientation and new product performance in Chinese marketing ventures: an exploration of main and moderating effects’, Journal of Strategic Marketing, vol. 20, no. 3, pp. 267-286.

Ergün, E & Tasgıt, Y 2013, ‘Cultures of adhocracy, clan, hierarchy and market and innovation performance: a case of hotels in Turkey’, Journal of Travel & Tourism Research, vol. 13, no. 2, pp. 132-142.

Iivari, J & Iivari, N 2011, ‘The relationship between organisational culture and the deployment of agile methods’, Information and Software Technology, vol. 53, no. 5, pp. 509-520.

Kim, H 2014, ‘Transformational leadership, organisational clan culture, organisational affective commitment, and organisational citizenship behaviour: a case of South Korea’s public sector’, Public Organisation Review, vol. 14, no. 3, pp. 397-417.

Nguyen, H & Mohamed, S 2011, ‘Leadership behaviours, organisational culture and knowledge management practices: an empirical investigation’, The Journal of Management Development, vol. 30, no. 2, pp. 206-221.

Prajogo, D & McDermott, C 2011, ‘The relationship between multidimensional organisational culture and performance’, International Journal of Operations & Production Management, vol. 31, no. 7, pp.712-735.

Reitzig, M & Maciejovsky, B 2015, ‘Corporate hierarchy and vertical information flow inside the firm-a behavioural view’, Strategic Management Journal, vol. 36, no. 13, pp.1979-1999.

Singh, A, Gupta, V, Dubey, A & Singh, A 2017, ‘The role of work-family culture and personality traits in organisational citizenship behaviour (OCB) of first-level managerial personnel’, IUP Journal of Organisational Behaviour, vol. 16, no. 1, pp. 58-71.

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