Organizational Culture Matters

Organizational cultures range from unrelenting paces and frugality to those who celebrate productivity and creativity. When a positive culture exists, it can have the benefits of greater productivity and happier employees, which usually translates into a better customer experience, higher retention, greater engagement and more innovation.

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    Organizational Culture Matters

    Organizational Culture Matters

    The cultures at Apple and Amazon are what have driven these companies to their great successes—yet they couldn’t be more different.

    Amazon’s culture is characterized by an unrelenting pace and frugality. Its high stress workplace, which was the subject of a scathing expose in The New York Times eight years ago, has frequently led to employee burnout.

    Apple, meanwhile, focuses on the design and functionality of its products and services, and under Tim Cook has worked to soften the strict and demanding environment that existed under Steve Jobs through greater attention to employee satisfaction.

    Types of Cultures

    There are several broad types of culture found in most businesses:

    • Adhocracy culture, which is dynamic and entrepreneurial. It’s a creative culture that is flexible and uninhibited by bureaucratic procedures or policies. Its emphasis on innovation and improvement means the pace is fast and the status quo is always open to question.
    • Clan culture—a people-oriented, close-knit group, often of interrelated families—is common to a small or family-owned business. It’s marked by a collaborative environment and designed to make all employees feel equal. Clan culture is characterized by teamwork, mentorship and high employee engagement.
    • Hierarchy culture is a process-oriented, control culture defined by structure, procedures and levels of authority. Employees know where they fit in the organization and what they are responsible for. The hierarchy culture is ideal for larger organizations where managing risk, stability and operational efficiency is prized. They may be less innovative or flexible.
    • Market culture is results-oriented and competitive. Its highest priorities are profit and staying ahead of the competition. This translates into an intense need to create and improve products before competitors do. There is less emphasis on employee experience or satisfaction.

    There are a number of other, less widespread types of organizational cultures, such as a Purpose culture, which operates on shared altruistic values of changing the world, or a Learning culture, which focuses on research, innovation, creativity, learning and development.

    Building a Positive Organizational Culture

    Not all successful organizations have a positive culture, though all may claim their highest reverence for customers, quality and employees. Developing a positive culture requires, first and foremost, leadership. It’s hard to cultivate a positive culture when the leadership team doesn’t practice what it preaches.

    All positive cultures are characterized by employee connection to the company’s mission, satisfaction with the workplace environment and a sense of teamwork throughout the organization.

    When a positive culture exists, it can have the benefits of greater productivity and happier employees, which usually translates into a better customer experience, higher retention, greater engagement and more innovation.

    Please reference disclosures at: https://blog.americanportfolios.com/disclosures/

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