Organisational culture is a system of shared traditions, shared values, and beliefs which have a strong effect on how people behave in organisations. Dell Computers suddenly struck out of nowhere and outsmarted Compaq and other leaders of the personal computer industry; Nike, which was initially a start-up with no reputation behind it, raced ahead of Adidas, a long-time solid performer in the sports-shoes market. These companies created magic by redefining value their own values. They built powerful, interconnected business systems that could deliver more value than their competitors. These industry leaders changed the customer’s outlook by delivering value-laid products. So, how do customers define value? In the past, customers judged the value of a product or service on the basis of some combination of quality and price. Today’s customers, by contrast, have an extended notion of value that includes the company’s culture in delivering convenience of purchase, after-sale service and dependability. Customer values are met by organisational values which are lasting beliefs that have a strong influence on the people in the organisation. It dictates how the organization appears in public eyes.
Edgar Henry Schein, a former Professor at the MIT Sloan School of Management, is known for his work in the field of organisational development, specially in areas such as career counseling, talent management, group dynamics and cultural developments. His model of organisational culture originated in the 1980s, identifies three distinct levels in organisation. They are artefacts, espoused values and assumptions.
Artefacts include any tangible, evident or verbally identifiable elements in an organisation. These include the architecture, beautification of workplace, architectural design, layout, fitting and maintenance, built-in space for movement (space, sound, and acoustics), functionality, attractive visuals, elegance, furniture etc. Artefacts include dress codes. Elegant dress codes speak a lot about workplace culture. They differ as per the nature of the workplace. Wearing ID-cards and clean dress, well-groomed employees convey lot about organisational culture.
The employees are organisation’s first brand ambassadors. Law firms are different from IT firms, hospitals are different from hospitality, manufacturing is different from retail and back office work is different from client-facing work. Formal dressing, communication, manners, etiquette, all exemplifies organisational artefacts. Artefacts are the visible elements in a culture and they make the first impression on outsiders. Lazy, shabbily dressed, sloppy employees mar the image of the organisation. When we bump into gossiping, self-engrossed employees, we lose interest in transacting with the organisation, don’t we?
Espoused values are the organisation’s stated values and rules of behaviour. It is how the members represent the organisation both in terms of their behaviour and performance. Their interpersonal behaviour and their behaviour with outsiders speak volumes. Espoused values are expressed in mission, vision, philosophies and values of the organisation. The mission, vision, goals, values are also called strategic intent. These need to be displayed nicely in framed posters in strategic locations in organisations. The mission and vision serve as a guide for all of business processes and decision-making. All stakeholders, including shareholders, employees, suppliers, bankers, and customers, associate with a firm’s values. Mission and vision statements project what the organisations hope to become.
The third level is assumptions. This is deeply rooted, taken-for-granted behaviour that constitute the deep essence of the work culture. These reflect in actions of the employees and management. A good fit happens when organisation hires employee who values the same things as the organisation does; a good fit makes the individual and organisation both happy. Employee behaviour can make or break an organisation. Being honest to work, being a well-wisher of the organisation, putting in the extra mile matters a lot. At times, when employees get involved in scams and deceitful acts, or when female employees complain about sexual harassment from bosses, it portrays a poor culture. The organisations follow a lot of silent practices, which are not discussed; actions speak louder than words.
Aligning all three layers is the critical job because inside an organisation, many groups exist—each with a different subculture. Many hurdles such as bureaucracy, personality conflicts among top managers, lack of transparency result into lack of alignment between the three layers. Strategic intents work fabulously when employees and management accept them totally. Organisations need to imbibe its culture internally first, so that it reflects well externally. For example, if an organisation gives importance to educational qualifications of employees, the values should be explained in detail to the members as they pass through the organisation’s education system.
Highly successful organisations do not simply proclaim set of values; rather they are immersed in their managers as well as their employee’s ideology to an obsessive degree. The adherence of organizational values is the core of discipline. When organisation put values in front and in centre, they automatically guide all aspects of business. Building a workforce that lives and works by the company moral code starts with a hiring process based upon values.
Good organisations promote organisational values by rewarding behaviours that demonstrate them. Not only does this make the individual feel good, it also pushes the rest of the employees to follow suit. Creating and breathing life into the organisational values and culture starts at the top with leaders who should, and must show an undying commitment to the values and culture and cultivate it in all processes of the business. There is an old maxim: employees do not turn to the decoratively-framed strategic intent in corridors or on the company website, they simply look at each other!
Director and professor of strategic management, Maratha Mandir’s Babasaheb Gawde Institute of Management Studies