by Jo Geraghty and Derek Bishop

What is organisational culture?

Organisational culture is the essence of how an organisation and the people who work there behave. Sometimes visible, sometimes invisible, it can be described as ‘the way things are done’, or the DNA of the business. whether you pull rank or pull together, put customers before profits or vice versa, it is the culture which governs your behaviour.

Organisational culture is essentially the collective beliefs, values, attitudes and behaviours of the people who work within an organisation. Unless deliberately set, or re-set, by the current or previous leaders of the organisation, the culture will have been built up and modified over time from every internal and external interaction.

When an entrepreneur starts up a new business, they will bring their own beliefs and behaviours into that business formation. But the business will also be affected by the attitudes of suppliers and customers, of legal or other advisers and of the wider industry. Over time, as employees join and leave, as the business has further interactions with the wider world, the culture will change, flexing and developing to meet constantly changing parameters.

At this early stage in our cultural journey, let us take the time to dispel the first culture myth. Myth one – businesses only have a culture if the leaders take time to do something active about setting it. Wrong. In the very fact of their existence, all organisations have a culture. It may be highly effective; it may be toxic; it may be completely chaotic, with every department displaying different characteristics, but whatever it is, it is there.

This leads us on to myth two ? organisational culture is a purely internal being. Wrong. Organisational culture is largely internal, but it is also influenced by the wider world. For example, look at any two hotels. How they greet their guests, what level of attention they pay to customer service, what added extras they offer to make stays more pleasant is down to the internal culture. But that internal culture is modified by external pressures which are common to both, such as health and safety, the general ethos and culture of the local area and the expectations of tourists.

While we are on the cultural myth roll, let’s bust myth three: organisational culture is the same throughout the entire organisation. This is a slightly tricky one. In effect, when we look at how culture is seen across an organisation, we have to split it into a core culture and a subculture. The core culture will contain elements which should be common across the organisation, such as care for fellow employees, a desire for customer excellence or ensuring that the business operates in a legal and ethical manner. The subculture may vary across departments or divisions. For example, an accounts department may have a subculture which values timeliness and accuracy, while a biological research division values security and cleanliness. This theme is revisited in more detail when we look at managing and leading culture change and at identifying and managing subcultures.

The way in which the culture/subculture split pans out within an organisation is one of the first indications of the measure of control which the leadership have over the culture. The weaker the control, the more likely we are to see wide variations between divisions, with each merrily going their own way under an ‘anything goes’ leadership. On the other side of the pendulum, a leader who seeks to have absolute control and dominance over a culture is also in for a fall, as this can lead to a lack of initiative and empowerment. We’ll look at this in more detail under the section on managing and leading culture change.

Certain aspects of an organisation’s culture may be encapsulated in print, perhaps in a staff manual or contract, in a service level agreement or in health and safety documentation, but there are other aspects of the culture which are unwritten, though no less valid. The way in which we approach problems, teamwork and interactions all come under this heading, but whether written or unwritten, the way in which the culture pans out can have profound implications for the organisation and we will review these in the section on the importance of organisational culture.

In the meantime, in summary, organisational culture

  • Is the essence of how the organisation and its people operate and behave
  • Is built up over time from internal and external interactions
  • Is there regardless of whether action is taken to manage it or not
  • May be encapsulated in documentation or simply seen by the way in which people act
  • Generally permeates the whole organisation, although subcultures may run in some sectors.