Corporate Culture The Key to Understanding Work Organisatio

Corporate Culture : The Key to Understanding Work Organisations

Organisational or corporate culture is widely held to refer to a system of shared meanings held by members that distinguishes the organisation from other organisations, that is a set of shared key characteristics or values.

The culture that an organisation has will play an important part in its success in its market sector. Likewise an organisation's continued success will depend to a large extent on the ability of the leadership of the organisation to perpetuate that culture.

A large, established organisation in a mature market is likely to have objectives of moderate growth and the maintenance of its position within the market. McDonald's is an example of such an organisation. You could walk in to a McDonald's restaurant in London, Tokyo or Moscow and expect to see staff dressed in the same uniform serving the same food from within restaurants that look remarkably similar. There are no risks to be taken here and rarely a snap decision to be made and certainly not by the staff.

Contrast this with a small organisation, thirsty for success in an emergent market such as Steve Job's Apple Computers in the early eighties. Here was a company led by a very strong character who was highly motivated, possessed a highly practical imagination and was fanatical about detail. He built up a multinational company on the strength of his ability to promote free thinking coupled with the attention to detail that is required to produce a world class computer within the organisation that he ran.

It is quite clear that if the cultures of these two organisations were transposed there would be internal chaos and the company's would lose their positions within their markets. A McDonald's restaurant that started to add flair to its menu would soon cut in to the company's tightly controlled profit margins whereas a company with tightly enforced rules and regulations could never lead the market in innovative technologies.

It is not by chance that these two organisations have such different cultures. They are each the product of a clearly constructed and executed leadership policies reinforced by the organisation's founders and subsequently their top management. The processes of selection and socialisation are key tools in the maintenance of an organisation's culture.

The selection process is typically employed within organisations not only to select individuals who have the technical skills and knowledge to perform their roles within the organisation but also to select people who will fit in with, and not undermine, the organisation's culture.

The process of socialisation has as its key objective the moulding of the individual, who has already been selected partly for their apparent conformity with the organisation's core values, in to a true member of the organisation where their values and norms are synchronised with those of their work group

A work organisation cannot be understood, however, by studying it's culture in isolation to the areas of group dynamics, leadership, power and influence. It is indeed not possible to understand organisational culture without putting it within the context of organisational behaviour as a whole.

Leadership plays a key role in the establishment of organisational culture. As culture is principally the subjective perception of the organisation's and how it achieves those aims then leadership must play a central role in setting the values that underlie this perception.

The founders of an organisation hold the responsibility for the establishment of an organisation's culture. In an embryonic company this does not necessarily have to be done with much thought. In this environment the organisation's founders generally have a lot to do with the day to day running of the organisation. The founders or their close associates will interview prospective employees and the successful candidates will be those who not only have the appropriate skills but those who also possess values and behaviours that are similar to those of the interviewer.

As the organisation develops and grows a number of sub-cultures will develop and it is now more important that the organisation's values are communicated in an effective way. Now the interviewers are further removed from the founders and direct exposure to their values and behaviours. Now it is important that the founders develop an effective way of communicating their values and behaviours so that they are seen as the basis of the dominant culture within the organisation.

Likewise the group dynamics within the organisation will have a direct relationship to the organisation's culture. In fact the norms that are established within the various groups that make up an organisation form a substantial part of the organisation's culture and it is in the establishment of these norms that leadership is so important for if dysfunctional norms are established within a group, for example a department of an organisation, then the effect on the organisation's culture would be potentially very damaging. We would see the norms within the department come in to conflict with the organisation's culture and if decisive leadership were not taking in tackling the dysfunctional norms then the possibility of these norms spreading throughout the organisation and overthrowing the organisation's existing culture is posed.

An organisation's culture may be seen as the commonality between the various group norms within the organisation. With effective leadership these norms can be centred around those of the organisation's official leadership through the effective communication and reinforcement of the leadership's values.

It can , therefore, be seen that the statement 'organisational culture is the key to understanding work organisations' cannot be substantiated as an organisation cannot be understood by simply looking at one aspect of its behaviour in isolation to the broad body of study collectively known as 'organisational behaviour'.


Organisational Culture within London Underground

London Underground was formed out of the railway lines that were built, owned and operated by a number of private railway companies that served the centre of London. These companies were formed around the turn of the century and were finally brought under the unifying umbrella of London Regional Transport in the 1940's. The private rail companies had developed the most modern technology to generate profits and had, on the whole, done this successfully

London Underground was formed out of the need to have a co-ordinated transport plan for the growing capital city in order to move people around without choking the streets with traffic.

It was only with the arrival of a new government in the late 70's that was intent on dismantling the nationalised industries that the leadership within London Underground was forced to rethink the direction it had been taking over the previous decades. London Underground had become a club. An organisation where high value was placed on fitting in, on loyalty, and on commitment. This club culture placed along side the lack of direction that the organisation was plagued with started to foster dysfunctional norms within groups that were furthest away from the leadership. As these individuals were promoted due to their seniority the organisation started to take on these dysfunctional norms as its dominant culture.

The government had been using its influence throughout the 80's to appoint a new leadership to London Underground and in the early 90's this leadership announced the 'company plan'. In order to obtain the finance from government that the organisation required to replace or repair the now crumbling infrastructure the organisation was to undergo a full review of its activities that would slash staffing levels by almost 25% through a complete review of the company's activities. The end result would be an "underground fit for the next century".

The culture within London Underground had become very strong and a whole range of tactics were employed to overturn the old culture. The organisation's leadership was replaced not only on the board of directors but wherever necessary throughout the organisation with 'outsiders' brought in from what has now become known as 'the real world'; where this was not possible or where there were suitable candidates within the company then employees who espoused the company's new values were promoted. The unwritten norms that had become the basis for the old culture were replaced, after months of long, heated discussions with the unions, with formal rules and regulations that were, and still are to a great extent, tightly enforced.

The net result today is an organisation that is at least pulling in the same direction as its leadership and where the values and behaviours have now been published and are being used to point the way forward.


· Openness, Honesty, Trust, Respect
· More for Less
· Empowerment Within a Framework
· Continuous Improvement, Steady State, Innovation Management
· Constructive Descent